Crown Castle International Corp. (NYSE: CCI) ("Crown Castle") today
reported results for the third quarter ended September 30,
2021, maintained its full year 2021 outlook, and issued 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) |
Midpoint Growth Rate Compared to Previous Year Outlook |
|
Current Outlook Midpoint(a) |
Midpoint Growth Rate Compared to Previous Year Actual(b) |
|
As Reported |
As Adjusted(c) |
Site rental revenues |
$5,975 |
5% |
|
$5,700 |
7% |
|
7% |
Income (loss) from continuing
operations(e) |
$1,424 |
28% |
|
$1,114(d) |
5% |
|
34% |
Income (loss) from continuing
operations per share —diluted(e)(f) |
$3.28 |
28% |
|
$2.57(d) |
9% |
|
40% |
Adjusted EBITDA(e) |
$4,022 |
6% |
|
$3,787 |
2% |
|
11% |
AFFO(e)(f) |
$3,201 |
8% |
|
$2,966 |
3% |
|
14% |
AFFO per share(e)(f) |
$7.36 |
8% |
|
$6.83 |
1% |
|
12% |
(a) As issued on October
20, 2021, and, with respect to the Current Full Year 2021 Outlook,
unchanged from the prior full year 2021 Outlook issued on July 21,
2021.(b) See "Full Year 2021 and 2022
Outlook" below for our full year 2020 actual
results.(c) 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.(d) 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.(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) Attributable to CCIC common
stockholders.
"We delivered strong results in the third
quarter and increased our annualized common stock dividend by
approximately 11% to $5.88 per share," stated Jay Brown, Crown
Castle’s Chief Executive Officer. "The dividend increase is
supported by the expected combined growth in 2021 and 2022, and
represents the second-consecutive year of dividend growth that
meaningfully exceeds our long-term growth target of 7% to 8% per
year. We are generating this level of growth as a result of a
robust tower leasing environment, which we expect will continue in
2022, consistent small cell install volumes in 2021 and 2022 and
stable fiber solutions growth, which combine to produce expected
AFFO per share growth at the high end of our long-term target. We
are focused on supporting our customers as they upgrade their
existing cell sites as part of the first phase of the 5G build out
in the U.S., which is resulting in record tower application volumes
this year and an expected 20% increase in core leasing activity for
our Towers segment for full year 2022 when compared to projected
2021 levels. This expected level of core leasing activity is
approximately 50% higher than the trailing 5-year average for our
Towers business.
"Looking forward, we continue to believe the
deployment of 5G will extend our opportunity to create value for
our shareholders, as we expect our ability to offer towers, small
cells and fiber solutions, which are all integral components of
communications networks, will be critical for our customers as they
increase the density of their networks during the next deployment
phase of 5G. Our diverse portfolio of assets and customer solutions
has enabled us to outperform our long-term target growth rate of 7%
to 8% since we established the target in 2017, demonstrating how
well positioned Crown Castle is to capitalize on the robust demand
for connectivity in the U.S. During that period, we have grown
dividends per share at a compound annual growth rate of 9%, and,
going forward, we believe our strategy will allow us to deliver on
our long-term dividend per share growth target."
RESULTS FOR THE QUARTERThe
table below sets forth select financial results for the quarter
ended September 30, 2021 and September 30, 2020.
(dollars in millions, except per share amounts) |
Q3 2021 |
Q3 2020 |
Change |
% Change |
Site rental revenues |
$1,451 |
$1,339 |
+$112 |
+8% |
Income (loss) from continuing
operations |
$351 |
$163 |
+$188 |
+115% |
Income (loss) from continuing
operations per share—diluted(a) |
$0.81 |
$0.38 |
+$0.43 |
+113% |
Adjusted EBITDA(b) |
$976 |
$883 |
+$93 |
+11% |
AFFO(a)(b) |
$767 |
$668 |
+$99 |
+15% |
AFFO per share(a)(b) |
$1.77 |
$1.56 |
+$0.21 |
+13% |
(a) Attributable to CCIC
common stockholders.(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.
HIGHLIGHTS FROM THE QUARTER
- Site rental
revenues. Site rental revenues grew 8%, or $112 million,
from third quarter 2020 to third quarter 2021, inclusive of
approximately $77 million in Organic Contribution to Site Rental
Revenues and a $34 million increase in straight-lined revenues. The
aforementioned $77 million in Organic Contribution to Site Rental
Revenues represents approximately 5.8% growth, comprised of
approximately 9.1% growth from new leasing activity and contracted
tenant escalations, net of approximately 3.3% from tenant
non-renewals.
- Income from continuing
operations. Income from continuing operations for third
quarter 2021 was $351 million compared to $163 million for third
quarter 2020 and was predominantly impacted by the increase in site
rental revenues and services contribution as well as the absence of
a loss of $95 million on retirement of long-term obligations.
- AFFO per share.
AFFO per share for third quarter 2021 was $1.77, representing 13%
growth when compared to $1.56 for third quarter 2020.
- Capital
expenditures. Capital expenditures during the quarter were
$283 million, comprised of $21 million of sustaining capital
expenditures and $262 million of discretionary capital
expenditures. Discretionary capital expenditures during the quarter
primarily included approximately $217 million attributable to Fiber
and approximately $42 million attributable to Towers.
- Common stock
dividend. During the quarter, Crown Castle paid common
stock dividends of approximately $575 million in the aggregate, or
$1.33 per common share, an increase of approximately 11% on a per
share basis compared to the same period a year ago.
"We are excited about the substantial growth we
are seeing in our business as our customers are deploying 5G at
scale, supporting our expectation that AFFO per share growth for
full year 2022 will be at the high end of our long-term growth
target after what we expect will be 12% AFFO per share growth this
year," stated Dan Schlanger, Crown Castle's Chief Financial
Officer. "From 2020 through 2022, we expect to grow AFFO per share
at a compound annual growth rate of 10%, demonstrating the
continued strength in activity levels across our business. Looking
forward, we believe we are in a great position to deliver on our
long-term dividend per share growth target while at the same time
making investments in our business that we believe will generate
attractive long-term returns and support future growth. We believe
our business and balance sheet are positioned well to support
consistent AFFO growth through various economic cycles, including
during periods of higher inflation and interest rates. Our cost
structure is largely fixed in nature, and we have taken deliberate
steps to further strengthen our balance sheet position to where we
sit today with more than 90% fixed-rate debt, a weighted average
maturity across our debt of more than nine years and a weighted
average interest rate of 3.1%. In addition, based on the expected
growth in cash flows for full year 2022, we expect to maintain a
consistent dividend payout ratio and once again fund our
discretionary capital budget next year with free cash flow and
incremental debt capacity, consistent with our investment grade
credit profile."
OUTLOOKThis 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.
The following table sets forth Crown Castle's
current Outlook for full year 2021, which is unchanged from the
prior full year 2021 Outlook, and full year 2022:
(in
millions, except per share amounts) |
Full Year 2021 |
Full Year 2022 |
Site rental revenues |
$5,677 |
to |
$5,722 |
$5,952 |
to |
$5,997 |
Site rental cost of operations(a) |
$1,538 |
to |
$1,583 |
$1,548 |
to |
$1,593 |
Income (loss) from continuing operations |
$1,074 |
to |
$1,154(b) |
$1,384 |
to |
$1,464 |
Adjusted EBITDA(c) |
$3,764 |
to |
$3,809 |
$3,999 |
to |
$4,044 |
Interest expense and
amortization of deferred financing costs(d) |
$633 |
to |
$678 |
$615 |
to |
$660 |
FFO(c)(e) |
$2,720 |
to |
$2,765 |
$3,068 |
to |
$3,113 |
AFFO(c)(e) |
$2,943 |
to |
$2,988 |
$3,178 |
to |
$3,223 |
AFFO per share(c)(e) |
$6.78 |
to |
$6.89 |
$7.31 |
to |
$7.41 |
(a) Exclusive of
depreciation, amortization and accretion.
(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 further information
and reconciliation of non-GAAP financial measures to Income (loss)
from continuing operations, as computed in accordance with
GAAP.(d) See reconciliation of
"Components of Current Outlook for Interest Expense and
Amortization of Deferred Financing Costs" for a discussion of
non-cash interest expense.
(e) Attributable to CCIC common
stockholders.Full Year 2021 and 2022 OutlookThe table below
compares the results for full year 2020, the midpoint of the
current full year 2021 Outlook that remains unchanged from the
previous full year 2021 Outlook, and the midpoint of the current
full year 2022 Outlook for select metrics.
|
Midpoint of Full Year 2022 Outlook |
|
Midpoint of Full Year 2021 Outlook |
|
2020 |
(in millions, except per share amounts) |
Current(a) |
|
Current(a) |
|
Full Year Actual |
Impact from Nontypical Items |
Site rental revenues |
$5,975 |
|
$5,700 |
|
$5,320 |
$— |
Income (loss) from continuing
operations |
$1,424 |
|
$1,114(b) |
|
$1,056 |
$223 |
Income (loss) from continuing
operations per share—diluted(c) |
$3.28 |
|
$2.57(b) |
|
$2.35 |
$0.52 |
Adjusted EBITDA(d) |
$4,022 |
|
$3,787 |
|
$3,706 |
$286 |
AFFO(c)(d) |
$3,201 |
|
$2,966 |
|
$2,878 |
$286 |
AFFO per share(c)(d) |
$7.36 |
|
$6.83 |
|
$6.78 |
$0.68 |
(a) As issued
on October 20, 2021, and, with respect to the Current Full Year
2021 Outlook, unchanged from the prior full year 2021 Outlook
issued on July 21, 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) Attributable to CCIC
common stockholders.(d) 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.
- The chart below reconciles the
components of expected growth in site rental revenues from 2021 to
2022 of $255 million to $300 million, inclusive of expected Organic
Contribution to Site Rental Revenues during 2022 of $245 million to
$285 million, or approximately 5%. The expected consolidated growth
includes approximately 5.5% from towers, approximately 5% from
small cells, and approximately 3% from fiber solutions. Chart
1: https://www.globenewswire.com/NewsRoom/AttachmentNg/ae59262c-3c11-43d2-a1d9-1f15b1fb70d9
- As shown in the
table below, new leasing activity for full year 2022 is expected to
contribute $335 million to $365 million, or $325 million to $355
million excluding the expected $10 million contribution from the
year-over-year increase in prepaid rent amortization. The expected
contribution from core leasing activity of $325 million to $355
million includes $155 million to $165 million of growth from towers
(compared to $130 million to $140 million expected in full year
2021), $25 million to $35 million of growth from small cells
(compared to $40 million to $50 million expected in full year
2021), and $145 million to $155 million of growth from fiber
solutions (compared to $160 million to $170 million expected in
full year 2021).
NEW LEASING ACTIVITY BY SEGMENT |
|
Full Year 2021 Outlook |
|
Full Year 2022 Outlook |
|
Towers |
|
Fiber |
|
Total |
|
Towers |
|
Fiber |
|
Total |
(in millions) |
|
|
Small Cells |
|
Fiber Solutions |
|
|
|
|
|
Small Cells |
|
Fiber Solutions |
|
|
New leasing activity(a) |
$150-$160 |
|
$50-$60 |
|
$160-$170 |
|
$360-$390 |
|
$160-$170 |
|
$25-$35 |
|
$150-$160 |
|
$335-$365 |
Less: Year-over-year increase in prepaid rent amortization |
(20) |
|
(10) |
|
— |
|
(30) |
|
(5) |
|
— |
|
(5) |
|
(10) |
Core leasing activity(a) |
$130-$140 |
|
$40-$50 |
|
$160-$170 |
|
$330-$360 |
|
$155-$165 |
|
$25-$35 |
|
$145-$155 |
|
$325-$355 |
(a) See
"Non-GAAP Financial Measures, Segment Measures and Other
Calculations" for a discussion of our definitions of new leasing
activity and core leasing activity.
- When comparing the midpoints of the
full year 2021 and full year 2022 Outlooks, the impact from
non-renewals is expected to increase by approximately $15 million.
The expected increase includes a $20 million increase in tower
non-renewals to approximately $60 million in 2022 from
approximately $40 million in 2021 that primarily relates to the
T-Mobile and Sprint network consolidation, offset by an expected $5
million reduction in fiber solutions non-renewals.
- The chart below reconciles the
components of expected growth in AFFO from 2021 to 2022 of $215
million to $260 million.Chart
2: https://www.globenewswire.com/NewsRoom/AttachmentNg/3a250640-bc45-4349-a6c4-1d2b30ef85d3
- In addition, discretionary capital
expenditures are expected to be $1.1 billion to $1.2 billion in
2022, which compares to an expected $1.1 billion in 2021 and $1.5
billion for full year 2020 actual. The lower levels of expected
discretionary capital expenditures in 2021 and 2022 as compared to
2020 primarily reflect the expected annual deployment of 5,000
small cells in each of 2021 and 2022 relative to approximately
10,000 small cells deployed in 2020. Prepaid rent additions are
expected to be approximately $400 million in 2022, consistent with
the expected prepaid rent additions in 2021.
- Additional information is available
in Crown Castle's quarterly Supplemental Information Package posted
in the Investors section of our website.
DIVIDEND INCREASE
ANNOUNCEMENTCrown Castle's Board of Directors has declared
a quarterly cash dividend of $1.47 per common share, representing
an increase of approximately 11% over the previous quarterly
dividend of $1.33 per share. The quarterly dividend will be payable
on December 31, 2021 to common stockholders of record at the close
of business on December 15, 2021. Future dividends are subject to
the approval of Crown Castle's Board of Directors.
CARBON NEUTRAL GOALIn a
separate press release today, Crown Castle announced it has set a
goal to be carbon neutral by 2025 in Scope 1 and 2 emissions
through a combination of continued investment in energy reduction
initiatives, sourcing renewable energy, and, to a lesser extent,
utilizing carbon credits or offsets.
CONFERENCE CALL DETAILSCrown
Castle has scheduled a conference call for Thursday, October 21,
2021, at 10:30 a.m. Eastern time to discuss its third quarter 2021
results. The conference call may be accessed by dialing
800-263-0877 and asking for the Crown Castle call (access code
7393600) 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, October 21,
2021, through 1:30 p.m. Eastern time on Wednesday, January 19,
2022, and may be accessed by dialing 888-203-1112 and using access
code 7393600. 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 CASTLECrown Castle
owns, operates and leases more than 40,000 cell towers and
approximately 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.
Contacts: |
Dan Schlanger, CFO |
|
Ben Lowe, SVP &
Treasurer |
|
Crown Castle International
Corp. |
|
713-570-3050 |
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. 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 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 cost 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 cost 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 the impact to site rental revenue growth, exclusive of
the impact of 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 the impact to site rental revenue growth from tenant
additions across our entire portfolio and renewals or extensions of
tenant contracts, exclusive of the impacts of both straight-line
accounting and prepaid rent amortization.
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.
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 Nine Months Ended |
|
For the Twelve Months Ended |
(in millions) |
September 30, 2021 |
|
September 30, 2020 |
|
September 30, 2021 |
|
September 30, 2020 |
|
December 31, 2020 |
Income (loss) from continuing operations |
$ |
351 |
|
|
$ |
163 |
|
|
$ |
805 |
|
|
(a) |
$ |
548 |
|
|
|
$ |
1,056 |
|
|
Adjustments to increase
(decrease) Income (loss) from continuing operations: |
|
|
|
|
|
|
|
|
|
Asset write-down charges |
— |
|
|
3 |
|
|
9 |
|
|
|
10 |
|
|
|
74 |
|
|
Acquisition and integration costs |
— |
|
|
2 |
|
|
1 |
|
|
|
9 |
|
|
|
10 |
|
|
Depreciation, amortization and accretion |
413 |
|
|
406 |
|
|
1,229 |
|
|
|
1,207 |
|
|
|
1,608 |
|
|
Amortization of prepaid lease purchase price adjustments |
4 |
|
|
5 |
|
|
14 |
|
|
|
14 |
|
|
|
18 |
|
|
Interest expense and amortization of deferred financing
costs(b) |
163 |
|
|
168 |
|
|
493 |
|
|
|
521 |
|
|
|
689 |
|
|
(Gains) losses on retirement of long-term obligations |
1 |
|
|
95 |
|
|
145 |
|
|
|
95 |
|
|
|
95 |
|
|
Interest income |
— |
|
|
— |
|
|
(1 |
) |
|
|
(2 |
) |
|
|
(2 |
) |
|
Other (income) expense |
4 |
|
|
3 |
|
|
16 |
|
|
|
3 |
|
|
|
5 |
|
|
(Benefit) provision for income taxes |
7 |
|
|
5 |
|
|
20 |
|
|
|
16 |
|
|
|
20 |
|
|
Stock-based compensation expense |
33 |
|
|
33 |
|
|
100 |
|
|
|
106 |
|
|
|
133 |
|
|
Adjusted EBITDA(c)(d) |
$ |
976 |
|
|
$ |
883 |
|
|
$ |
2,831 |
|
|
|
$ |
2,527 |
|
|
|
$ |
3,706 |
|
|
Reconciliation of Current Outlook for Adjusted
EBITDA:
|
Full Year 2021 |
|
Full Year 2022 |
(in millions) |
Outlook(f) |
|
Outlook(f) |
Income (loss) from continuing operations |
$1,074 |
|
to |
|
$1,154(a) |
|
$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(e) |
$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) 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 October 20, 2021, and, with respect to the Current Full
Year 2021 Outlook, unchanged from the prior full year 2021 Outlook
issued on July 21, 2021.
Reconciliation of Historical FFO and
AFFO:
|
For the Three Months Ended |
|
For the Nine Months Ended |
|
For the Twelve Months Ended |
(in millions, except per share
amounts) |
September 30, 2021 |
|
September 30, 2020 |
|
September 30, 2021 |
|
September 30, 2020 |
|
December 31, 2020 |
Income (loss) from continuing operations |
$ |
351 |
|
|
|
$ |
163 |
|
|
|
$ |
805 |
|
|
(a) |
$ |
548 |
|
|
|
$ |
1,056 |
|
|
Real estate related depreciation, amortization and accretion |
400 |
|
|
|
393 |
|
|
|
1,190 |
|
|
|
1,167 |
|
|
|
1,555 |
|
|
Asset write-down charges |
— |
|
|
|
3 |
|
|
|
9 |
|
|
|
10 |
|
|
|
74 |
|
|
Dividends/distributions on preferred stock |
— |
|
|
|
(28 |
) |
|
|
— |
|
|
|
(85 |
) |
|
|
(85 |
) |
|
FFO(b)(c)(d)(e) |
$ |
751 |
|
|
|
$ |
531 |
|
|
|
$ |
2,004 |
|
|
|
$ |
1,640 |
|
|
|
$ |
2,600 |
|
|
Weighted-average common shares outstanding—diluted |
434 |
|
|
|
429 |
|
|
|
434 |
|
|
|
422 |
|
|
|
425 |
|
|
FFO per share(b)(c)(d)(e) |
$ |
1.73 |
|
|
|
$ |
1.24 |
|
|
|
$ |
4.62 |
|
|
|
$ |
3.89 |
|
|
|
$ |
6.12 |
|
|
|
|
|
|
|
|
|
|
|
|
FFO (from above) |
$ |
751 |
|
|
|
$ |
531 |
|
|
|
$ |
2,004 |
|
|
|
$ |
1,640 |
|
|
|
$ |
2,600 |
|
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
|
|
Straight-lined revenue |
(38 |
) |
|
|
(4 |
) |
|
|
(73 |
) |
|
|
(27 |
) |
|
|
(22 |
) |
|
Straight-lined expense |
18 |
|
|
|
21 |
|
|
|
58 |
|
|
|
61 |
|
|
|
83 |
|
|
Stock-based compensation expense |
33 |
|
|
|
33 |
|
|
|
100 |
|
|
|
106 |
|
|
|
133 |
|
|
Non-cash portion of tax provision |
3 |
|
|
|
(7 |
) |
|
|
3 |
|
|
|
3 |
|
|
|
1 |
|
|
Non-real estate related depreciation, amortization and
accretion |
13 |
|
|
|
13 |
|
|
|
39 |
|
|
|
40 |
|
|
|
53 |
|
|
Amortization of non-cash interest expense |
3 |
|
|
|
1 |
|
|
|
9 |
|
|
|
4 |
|
|
|
6 |
|
|
Other (income) expense |
4 |
|
|
|
3 |
|
|
|
16 |
|
|
|
3 |
|
|
|
5 |
|
|
(Gains) losses on retirement of long-term obligations |
1 |
|
|
|
95 |
|
|
|
145 |
|
|
|
95 |
|
|
|
95 |
|
|
Acquisition and integration costs |
— |
|
|
|
2 |
|
|
|
1 |
|
|
|
9 |
|
|
|
10 |
|
|
Sustaining capital expenditures |
(21 |
) |
|
|
(20 |
) |
|
|
(56 |
) |
|
|
(64 |
) |
|
|
(86 |
) |
|
AFFO(b)(c)(d)(e) |
$ |
767 |
|
|
|
$ |
668 |
|
|
|
$ |
2,246 |
|
|
|
$ |
1,870 |
|
|
|
$ |
2,878 |
|
|
Weighted-average common shares outstanding—diluted |
434 |
|
|
|
429 |
|
|
|
434 |
|
|
|
422 |
|
|
|
425 |
|
|
AFFO per share(b)(c)(d)(e) |
$ |
1.77 |
|
|
|
$ |
1.56 |
|
|
|
$ |
5.18 |
|
|
|
$ |
4.43 |
|
|
|
$ |
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.
Reconciliation of Current Outlook for
FFO and AFFO:
|
Full Year 2021 |
|
Full Year 2022 |
(in millions, except per share
amounts) |
Outlook(f) |
|
Outlook(f) |
Income (loss) from continuing
operations |
$1,074 |
|
to |
|
$1,154(a) |
|
$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(b)(c)(d) |
$2,720 |
|
to |
|
$2,765 |
|
|
$3,068 |
|
to |
|
$3,113 |
|
Weighted-average common shares outstanding—diluted(e) |
|
|
434 |
|
|
|
|
|
|
435 |
|
|
|
FFO per share(b)(c)(d)(e) |
$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(b)(c)(d) |
$2,943 |
|
to |
|
$2,988 |
|
|
$3,178 |
|
to |
|
$3,223 |
|
Weighted-average common shares outstanding—diluted(e) |
|
|
|
434 |
|
|
|
|
|
|
|
|
435 |
|
|
|
|
AFFO per share(b)(c)(d)(e) |
$6.78 |
|
to |
|
$6.89 |
|
|
$7.31 |
|
to |
|
$7.41 |
|
(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) 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) The assumption for diluted
weighted-average common shares outstanding for both full year 2021
and full year 2022 Outlook is based on the diluted common shares
outstanding as of September 30,
2021.(f) As issued on October 20,
2021, and, with respect to the Current Full Year 2021 Outlook,
unchanged from the prior full year 2021 Outlook issued on July 21,
2021.
Reconciliation of Results Adjusted for
Nontypical Items to As Reported Results:
|
Midpoint of Current Full Year2021(a) |
|
Full Year 2020 |
|
Full Year 2021 Growth Rates (Outlook at the Midpoint) |
(dollars in millions, except
per share amounts) |
Outlook |
|
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 |
$ |
5,700 |
|
|
|
$ |
5,320 |
|
|
$ |
— |
|
|
|
|
$ |
5,320 |
|
|
7 |
% |
|
— |
% |
|
|
7 |
% |
Income (loss) from continuing
operations(b) |
1,114 |
|
(d) |
|
1,056 |
|
|
(223 |
) |
|
(e) |
|
833 |
|
|
5 |
% |
|
29 |
% |
(e) |
|
34 |
% |
Income (loss) from continuing
operations per share—diluted(b)(c) |
2.57 |
|
(d) |
|
2.35 |
|
|
(0.52 |
) |
|
(e) |
|
1.83 |
|
|
9 |
% |
|
31 |
% |
(e) |
|
40 |
% |
Adjusted EBITDA(b) |
3,787 |
|
|
|
3,706 |
|
|
(286 |
) |
|
(f) |
|
3,420 |
|
|
2 |
% |
|
9 |
% |
(f) |
|
11 |
% |
AFFO(b)(c) |
2,966 |
|
|
|
2,878 |
|
|
(286 |
) |
|
(f) |
|
2,592 |
|
|
3 |
% |
|
11 |
% |
(f) |
|
14 |
% |
AFFO per share(b)(c) |
$ |
6.83 |
|
|
|
$ |
6.78 |
|
|
$ |
(0.68 |
) |
|
(f) |
|
$ |
6.10 |
|
|
1 |
% |
|
11 |
% |
(f) |
|
12 |
% |
(a) The
Nontypical Items do not have a material impact on the full year
2021 Outlook, which previously contemplated the deployment of
approximately 1,000 Sprint Corporation small cells, which were
among the small cells that were cancelled by T-Mobile US, Inc. in
the fourth quarter 2020, as described further in our press release
dated January 27, 2021.(b) 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.(c) Attributable to CCIC
common stockholders.(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) 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.(f) 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.Components of changes in site
rental revenues for the quarters ended September 30, 2021 and
2020:
|
Three Months Ended September 30, |
(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) |
$ |
1,335 |
|
|
|
$ |
1,265 |
|
|
|
|
|
|
New leasing activity(b)(c) |
98 |
|
|
|
93 |
|
|
Escalators |
23 |
|
|
|
23 |
|
|
Non-renewals |
(44 |
) |
|
|
(46 |
) |
|
Organic Contribution to Site Rental Revenues(d) |
77 |
|
|
|
70 |
|
|
Impact from straight-lined revenues associated with fixed
escalators |
38 |
|
|
|
4 |
|
|
Acquisitions(e) |
1 |
|
|
|
— |
|
|
Other |
— |
|
|
|
— |
|
|
Total GAAP site rental
revenues |
$ |
1,451 |
|
|
|
$ |
1,339 |
|
|
|
|
|
|
Year-over-year changes
in revenue: |
|
|
|
Reported GAAP site rental
revenues |
8.4 |
% |
|
|
|
Organic Contribution to Site
Rental Revenues(d)(f) |
5.8 |
% |
|
|
|
Components of the changes in site rental revenues for
full year 2021 and 2022 Outlooks:
(dollars in millions) |
Current Full Year 2021 Outlook(a) |
|
Current Full Year 2022 Outlook(a) |
Components of changes in site
rental revenues:(b) |
|
|
|
Prior year site rental revenues exclusive of straight-lined
revenues associated with fixed escalators(c)(d) |
$5,298 |
|
|
$5,593(h) |
|
|
|
|
New leasing activity(c)(d) |
$360 |
|
to |
|
$390 |
|
|
$335 |
|
to |
|
$365 |
|
Escalators |
$90 |
|
to |
|
$100 |
|
|
$95 |
|
to |
|
$105 |
|
Non-renewals |
$(180 |
) |
to |
|
$(160) |
|
|
$(195 |
) |
to |
|
$(175) |
|
Organic Contribution to Site Rental Revenues(e) |
$280 |
|
to |
|
$320 |
|
|
$245 |
|
to |
|
$285 |
|
Impact from full year straight-lined revenues associated with fixed
escalators |
$97 |
|
to |
|
$117 |
|
|
$109 |
|
to |
|
$129 |
|
Acquisitions(f) |
<$5 |
|
— |
|
Other |
— |
|
|
— |
|
Total GAAP site rental revenues |
$ |
5,677 |
|
to |
|
$ |
5,722 |
|
|
$5,952 |
|
to |
|
$5,997 |
|
|
|
|
|
Year-over-year changes
in revenue: |
|
|
|
Reported GAAP site rental
revenues(h) |
7.1% |
|
|
4.8% |
|
Organic Contribution to Site
Rental Revenues(e)(g)(h) |
5.7% |
|
|
4.7% |
|
(a) As issued
on October 20, 2021, and, with respect to the Current Full Year
2021 Outlook, unchanged from the prior full year 2021 Outlook
issued on July 21, 2021.(b) 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. (c) Includes
revenues from amortization of prepaid rent in accordance with
GAAP.(d) Includes revenues from
the construction of new small cell nodes, exclusive of
straight-lined revenues related to fixed escalators.
(e) See "Non-GAAP Financial
Measures, Segment Measures and Other Calculations" herein.
(f) 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.
(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) Calculated based on
midpoint of respective full year outlook.
Components of Historical Interest
Expense and Amortization of Deferred Financing Costs:
|
For the Three Months Ended |
(in millions) |
September 30, 2021 |
|
September 30, 2020 |
Interest expense on debt obligations |
$ |
160 |
|
|
|
$ |
167 |
|
|
Amortization of deferred
financing costs and adjustments on long-term debt, net |
6 |
|
|
|
6 |
|
|
Capitalized interest |
(3 |
) |
|
|
(5 |
) |
|
Interest expense and
amortization of deferred financing costs |
$ |
163 |
|
|
|
$ |
168 |
|
|
Components of Current Outlook for
Interest Expense and Amortization of Deferred Financing
Costs:
|
Full Year 2021 |
|
Full Year 2022 |
(in millions) |
Outlook |
|
Outlook |
Interest expense on debt obligations |
$638 |
|
to |
|
$658 |
|
|
$617 |
|
to |
|
$637 |
|
Amortization of deferred
financing costs and adjustments on long-term debt, net |
$21 |
|
to |
|
$26 |
|
|
$25 |
|
to |
|
$30 |
|
Capitalized interest |
$(17 |
) |
to |
|
$(12) |
|
|
$(20 |
) |
to |
|
$(15) |
|
Interest expense and
amortization of deferred financing costs |
$633 |
|
to |
|
$678 |
|
|
$615 |
|
to |
|
$660 |
|
Debt balances and maturity dates as of
September 30, 2021 are as follows:
(in millions) |
Face Value |
|
Final Maturity |
Cash, cash equivalents and restricted cash |
$ |
542 |
|
|
|
|
|
|
|
3.849% Secured Notes |
1,000 |
|
|
Apr. 2023 |
Secured Notes, Series 2009-1,
Class A-2(a) |
55 |
|
|
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 |
240 |
|
|
Various |
Total secured debt |
$ |
2,995 |
|
|
|
2016 Revolver(c) |
— |
|
|
June 2026 |
2016 Term Loan A |
1,231 |
|
|
June 2026 |
Commercial Paper Notes(d) |
665 |
|
|
Oct. 2021 |
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 |
$ |
17,546 |
|
|
|
Total net debt |
$ |
19,999 |
|
|
|
(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
September 30, 2021, the undrawn availability under the $5.0
billion 2016 Revolver was $5.0
billion.(d) As of September 30,
2021, the Company had $335 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.
Net Debt to Last Quarter Annualized Adjusted EBITDA is
computed as follows:
(dollars in millions) |
For the Three Months Ended September 30, 2021 |
Total face value of debt |
$ |
20,541 |
|
Less: Ending cash, cash
equivalents and restricted cash |
542 |
|
Total Net Debt |
$ |
19,999 |
|
|
|
Adjusted EBITDA for the three
months ended September 30, 2021 |
$ |
976 |
|
Last quarter annualized
Adjusted EBITDA |
3,904 |
|
Net Debt to Last
Quarter Annualized Adjusted EBITDA |
5.1 |
x |
Components of Capital
Expenditures:(a)
|
For the Three Months Ended |
(in millions) |
September 30, 2021 |
|
September 30, 2020 |
|
Towers |
Fiber |
Other |
Total |
|
Towers |
Fiber |
Other |
Total |
Discretionary: |
|
|
|
|
|
|
|
|
|
Purchases of land interests |
$ |
11 |
|
$ |
— |
|
$ |
— |
|
$ |
11 |
|
|
$ |
12 |
|
$ |
— |
|
$ |
— |
|
$ |
12 |
|
Communications infrastructure improvements and other capital
projects |
31 |
|
217 |
|
3 |
|
251 |
|
|
61 |
|
274 |
|
10 |
|
345 |
|
Sustaining |
4 |
|
12 |
|
5 |
|
21 |
|
|
3 |
|
13 |
|
4 |
|
20 |
|
Total |
$ |
46 |
|
$ |
229 |
|
$ |
8 |
|
$ |
283 |
|
|
$ |
76 |
|
$ |
287 |
|
$ |
14 |
|
$ |
377 |
|
|
For the Nine Months Ended |
(in millions) |
September 30, 2021 |
|
September 30, 2020 |
|
Towers |
Fiber |
Other |
Total |
|
Towers |
Fiber |
Other |
Total |
Discretionary: |
|
|
|
|
|
|
|
|
|
Purchases of land interests |
$ |
46 |
|
$ |
— |
|
$ |
— |
|
$ |
46 |
|
|
$ |
41 |
|
$ |
— |
|
$ |
— |
|
$ |
41 |
|
Communications infrastructure improvements and other capital
projects |
104 |
|
666 |
|
20 |
|
790 |
|
|
220 |
|
888 |
|
25 |
|
1,133 |
|
Sustaining |
10 |
|
35 |
|
11 |
|
56 |
|
|
11 |
|
38 |
|
15 |
|
64 |
|
Total |
$ |
160 |
|
$ |
701 |
|
$ |
31 |
|
$ |
892 |
|
|
$ |
272 |
|
$ |
926 |
|
$ |
40 |
|
$ |
1,238 |
|
(a) See
"Non-GAAP Financial Measures, Segment Measures and Other
Calculations" for further discussion of our components of capital
expenditures.
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," "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 2021 and 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 (including compound annual 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 thereof and any
benefits that may result therefrom, (12) revenues and growth
thereof and benefits derived therefrom, (13) the recurrence
and impact of 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 (including with respect to compound annual
growth rate) 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, (23) fiber
solutions growth, (24) prepaid rent, including the additions and
the amortization and growth thereof, (25) our carbon neutral goal
and plans related thereto, (26) demand for data and connectivity,
(27) impact from T-Mobile and Sprint network consolidation, (28)
strength of our balance sheet and (29) 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.
- 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.
- The restatement of our previously
issued financial statements, the errors that resulted in such
restatement, the material weakness that was previously identified
in our internal control over financial reporting and the
determination that our internal control over financial reporting
and disclosure controls and procedures were not effective, could
result in loss of investor confidence, shareholder litigation or
governmental proceedings or investigations, any of which could
cause the market value of our common stock or debt securities to
decline or impact our ability to access the capital markets.
- 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."
CROWN CASTLE INTERNATIONAL CORP.CONDENSED
CONSOLIDATED BALANCE SHEET (UNAUDITED)(Amounts in
millions, except par values) |
|
September 30,2021 |
|
December 31,2020 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
357 |
|
|
|
$ |
232 |
|
|
Restricted cash |
180 |
|
|
|
144 |
|
|
Receivables, net |
493 |
|
|
|
431 |
|
|
Prepaid expenses |
120 |
|
|
|
95 |
|
|
Other current assets |
182 |
|
|
|
202 |
|
|
Total current assets |
1,332 |
|
|
|
1,104 |
|
|
Deferred site rental
receivables |
1,516 |
|
|
|
1,408 |
|
|
Property and equipment,
net |
15,174 |
|
|
|
15,162 |
|
|
Operating lease right-of-use
assets |
6,659 |
|
|
|
6,464 |
|
|
Goodwill |
10,078 |
|
|
|
10,078 |
|
|
Other intangible assets,
net |
4,115 |
|
|
|
4,433 |
|
|
Other assets, net |
130 |
|
|
|
119 |
|
|
Total assets |
$ |
39,004 |
|
|
|
$ |
38,768 |
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
231 |
|
|
|
$ |
230 |
|
|
Accrued interest |
141 |
|
|
|
199 |
|
|
Deferred revenues |
822 |
|
|
|
704 |
|
|
Other accrued liabilities |
376 |
|
|
|
378 |
|
|
Current maturities of debt and other obligations |
72 |
|
|
|
129 |
|
|
Current portion of operating lease liabilities |
345 |
|
|
|
329 |
|
|
Total current liabilities |
1,987 |
|
|
|
1,969 |
|
|
Debt and other long-term
obligations |
20,293 |
|
|
|
19,151 |
|
|
Operating lease
liabilities |
6,000 |
|
|
|
5,808 |
|
|
Other long-term
liabilities |
2,208 |
|
|
|
2,379 |
|
|
Total liabilities |
30,488 |
|
|
|
29,307 |
|
|
Commitments and
contingencies |
|
|
|
CCIC stockholders'
equity: |
|
|
|
Common stock, $0.01 par value; 600 shares authorized; shares issued
and outstanding: September 30, 2021—432 and December 31,
2020—431 |
4 |
|
|
|
4 |
|
|
Additional paid-in capital |
17,982 |
|
|
|
17,933 |
|
|
Accumulated other comprehensive income (loss) |
(3 |
) |
|
|
(4 |
) |
|
Dividends/distributions in excess of earnings |
(9,467 |
) |
|
|
(8,472 |
) |
|
Total equity |
8,516 |
|
|
|
9,461 |
|
|
Total liabilities and equity |
$ |
39,004 |
|
|
|
$ |
38,768 |
|
|
CROWN CASTLE INTERNATIONAL CORP.CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)(Amounts
in millions, except per share amounts) |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
Net revenues: |
|
|
|
|
|
|
|
Site rental |
$ |
1,451 |
|
|
|
$ |
1,339 |
|
|
|
$ |
4,245 |
|
|
|
$ |
3,968 |
|
|
Services and other |
167 |
|
|
|
147 |
|
|
|
441 |
|
|
|
379 |
|
|
Net revenues |
1,618 |
|
|
|
1,486 |
|
|
|
4,686 |
|
|
|
4,347 |
|
|
Operating expenses: |
|
|
|
|
|
|
|
Costs of operations:(a) |
|
|
|
|
|
|
|
Site rental |
397 |
|
|
|
370 |
|
|
|
1,168 |
|
|
|
1,123 |
|
|
Services and other |
115 |
|
|
|
117 |
|
|
|
301 |
|
|
|
324 |
|
|
Selling, general and administrative |
167 |
|
|
|
154 |
|
|
|
500 |
|
|
|
493 |
|
|
Asset write-down charges |
— |
|
|
|
3 |
|
|
|
9 |
|
|
|
10 |
|
|
Acquisition and integration costs |
— |
|
|
|
2 |
|
|
|
1 |
|
|
|
9 |
|
|
Depreciation, amortization and accretion |
413 |
|
|
|
406 |
|
|
|
1,229 |
|
|
|
1,207 |
|
|
Total operating expenses |
1,092 |
|
|
|
1,052 |
|
|
|
3,208 |
|
|
|
3,166 |
|
|
Operating income (loss) |
526 |
|
|
|
434 |
|
|
|
1,478 |
|
|
|
1,181 |
|
|
Interest expense and
amortization of deferred financing costs |
(163 |
) |
|
|
(168 |
) |
|
|
(493 |
) |
|
|
(521 |
) |
|
Gains (losses) on retirement
of long-term obligations |
(1 |
) |
|
|
(95 |
) |
|
|
(145 |
) |
|
|
(95 |
) |
|
Interest income |
— |
|
|
|
— |
|
|
|
1 |
|
|
|
2 |
|
|
Other income (expense) |
(4 |
) |
|
|
(3 |
) |
|
|
(16 |
) |
|
|
(3 |
) |
|
Income (loss) before income
taxes |
358 |
|
|
|
168 |
|
|
|
825 |
|
|
|
564 |
|
|
Benefit (provision) for income
taxes |
(7 |
) |
|
|
(5 |
) |
|
|
(20 |
) |
|
|
(16 |
) |
|
Income (loss) from continuing
operations |
351 |
|
|
|
163 |
|
|
|
805 |
|
|
|
548 |
|
|
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) |
351 |
|
|
|
163 |
|
|
|
743 |
|
|
|
548 |
|
|
Dividends/distributions on
preferred stock |
— |
|
|
|
— |
|
|
|
— |
|
|
|
(57 |
) |
|
Net income (loss) attributable
to CCIC common stockholders |
$ |
351 |
|
|
|
$ |
163 |
|
|
|
$ |
743 |
|
|
|
$ |
491 |
|
|
|
|
|
|
|
|
|
|
Net income (loss) attributable
to CCIC common stockholders, per common share: |
|
|
|
|
|
|
|
Income (loss) from continuing operations, basic |
$ |
0.81 |
|
|
|
$ |
0.38 |
|
|
|
$ |
1.86 |
|
|
|
$ |
1.17 |
|
|
Income (loss) from discontinued operations, basic |
— |
|
|
|
— |
|
|
|
(0.14 |
) |
|
|
— |
|
|
Net income (loss) attributable to CCIC common stockholders,
basic |
$ |
0.81 |
|
|
|
$ |
0.38 |
|
|
|
$ |
1.72 |
|
|
|
$ |
1.17 |
|
|
Income (loss) from continuing operations, diluted |
$ |
0.81 |
|
|
|
$ |
0.38 |
|
|
|
$ |
1.85 |
|
|
|
$ |
1.17 |
|
|
Income (loss) from discontinued operations, diluted |
— |
|
|
|
— |
|
|
|
(0.14 |
) |
|
|
— |
|
|
Net income (loss) attributable to CCIC common stockholders,
diluted |
$ |
0.81 |
|
|
|
$ |
0.38 |
|
|
|
$ |
1.71 |
|
|
|
$ |
1.17 |
|
|
|
|
|
|
|
|
|
|
Weighted-average common shares
outstanding: |
|
|
|
|
|
|
|
Basic |
432 |
|
|
|
427 |
|
|
|
432 |
|
|
|
420 |
|
|
Diluted |
434 |
|
|
|
429 |
|
|
|
434 |
|
|
|
422 |
|
|
(a) Exclusive of depreciation, amortization and
accretion shown separately.
CROWN CASTLE INTERNATIONAL CORP.CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)(In
millions of dollars) |
|
Nine Months Ended September 30, |
|
2021 |
|
2020 |
Cash flows from
operating activities: |
|
|
|
Income (loss) from continuing operations |
$ |
805 |
|
|
|
$ |
548 |
|
|
Adjustments to reconcile
Income (loss) from continuing operations to net cash provided by
(used for) operating activities: |
|
|
|
Depreciation, amortization and accretion |
1,229 |
|
|
|
1,207 |
|
|
(Gains) losses on retirement of long-term obligations |
145 |
|
|
|
95 |
|
|
Amortization of deferred financing costs and other non-cash
interest, net |
9 |
|
|
|
4 |
|
|
Stock-based compensation expense |
100 |
|
|
|
108 |
|
|
Asset write-down charges |
9 |
|
|
|
10 |
|
|
Deferred income tax (benefit) provision |
4 |
|
|
|
2 |
|
|
Other non-cash adjustments, net |
18 |
|
|
|
4 |
|
|
Changes in assets and liabilities, excluding the effects of
acquisitions: |
|
|
|
Increase (decrease) in liabilities |
(100 |
) |
|
|
(29 |
) |
|
Decrease (increase) in assets |
(164 |
) |
|
|
121 |
|
|
Net cash provided by (used for) operating activities |
2,055 |
|
|
|
2,070 |
|
|
Cash flows from
investing activities: |
|
|
|
Capital expenditures |
(892 |
) |
|
|
(1,238 |
) |
|
Payments for acquisitions, net of cash acquired |
(27 |
) |
|
|
(86 |
) |
|
Other investing activities, net |
8 |
|
|
|
(12 |
) |
|
Net cash provided by (used for) investing activities |
(911 |
) |
|
|
(1,336 |
) |
|
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 |
(1,057 |
) |
|
|
(80 |
) |
|
Purchases and redemptions of long-term debt |
(2,089 |
) |
|
|
(2,490 |
) |
|
Borrowings under revolving credit facility |
580 |
|
|
|
2,140 |
|
|
Payments under revolving credit facility |
(870 |
) |
|
|
(2,145 |
) |
|
Net borrowings (repayments) under commercial paper program |
380 |
|
|
|
(80 |
) |
|
Payments for financing costs |
(43 |
) |
|
|
(38 |
) |
|
Purchases of common stock |
(69 |
) |
|
|
(75 |
) |
|
Dividends/distributions paid on common stock |
(1,738 |
) |
|
|
(1,531 |
) |
|
Dividends/distributions paid on preferred stock |
— |
|
|
|
(85 |
) |
|
Net cash provided by (used for) financing activities |
(921 |
) |
|
|
(651 |
) |
|
Net increase
(decrease) in cash, cash equivalents, and restricted cash -
continuing operations |
223 |
|
|
|
83 |
|
|
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 |
$ |
542 |
|
|
|
$ |
421 |
|
|
Supplemental
disclosure of cash flow information: |
|
|
|
Interest paid |
542 |
|
|
|
564 |
|
|
Income taxes paid |
17 |
|
|
|
13 |
|
|
CROWN CASTLE INTERNATIONAL CORP.SEGMENT
OPERATING RESULTS (UNAUDITED)(In millions of dollars) |
SEGMENT OPERATING RESULTS |
|
Three Months Ended September 30, 2021 |
|
Three Months Ended September 30, 2020 |
|
Towers |
|
Fiber |
|
Other |
|
Consolidated Total |
|
Towers |
|
Fiber |
|
Other |
|
Consolidated Total |
Segment site rental revenues |
$ |
972 |
|
|
$ |
479 |
|
|
|
|
$ |
1,451 |
|
|
$ |
877 |
|
|
$ |
462 |
|
|
|
|
$ |
1,339 |
|
Segment services and other
revenues |
162 |
|
|
5 |
|
|
|
|
167 |
|
|
142 |
|
|
5 |
|
|
|
|
147 |
|
Segment revenues |
1,134 |
|
|
484 |
|
|
|
|
1,618 |
|
|
1,019 |
|
|
467 |
|
|
|
|
1,486 |
|
Segment site rental costs of
operations |
227 |
|
|
163 |
|
|
|
|
390 |
|
|
216 |
|
|
145 |
|
|
|
|
361 |
|
Segment services and other
costs of operations |
108 |
|
|
4 |
|
|
|
|
112 |
|
|
111 |
|
|
4 |
|
|
|
|
115 |
|
Segment costs of
operations(a)(b) |
335 |
|
|
167 |
|
|
|
|
502 |
|
|
327 |
|
|
149 |
|
|
|
|
476 |
|
Segment site rental gross
margin(c) |
745 |
|
|
316 |
|
|
|
|
1,061 |
|
|
661 |
|
|
317 |
|
|
|
|
978 |
|
Segment services and other
gross margin(c) |
54 |
|
|
1 |
|
|
|
|
55 |
|
|
31 |
|
|
1 |
|
|
|
|
32 |
|
Segment selling, general and
administrative expenses(b) |
27 |
|
|
44 |
|
|
|
|
71 |
|
|
22 |
|
|
42 |
|
|
|
|
64 |
|
Segment operating
profit(c) |
772 |
|
|
273 |
|
|
|
|
1,045 |
|
|
670 |
|
|
276 |
|
|
|
|
946 |
|
Other selling, general and
administrative expenses(b) |
|
|
|
|
$ |
69 |
|
|
69 |
|
|
|
|
|
|
$ |
63 |
|
|
63 |
|
Stock-based compensation
expense |
|
|
|
|
33 |
|
|
33 |
|
|
|
|
|
|
33 |
|
|
33 |
|
Depreciation, amortization and
accretion |
|
|
|
|
413 |
|
|
413 |
|
|
|
|
|
|
406 |
|
|
406 |
|
Interest expense and
amortization of deferred financing costs |
|
|
|
|
163 |
|
|
163 |
|
|
|
|
|
|
168 |
|
|
168 |
|
Other (income) expenses to
reconcile to income (loss) before income taxes(d) |
|
|
|
|
9 |
|
|
9 |
|
|
|
|
|
|
108 |
|
|
108 |
|
Income (loss) before income
taxes |
|
|
|
|
|
|
$ |
358 |
|
|
|
|
|
|
|
|
$ |
168 |
|
FIBER SEGMENT SITE RENTAL REVENUES SUMMARY |
|
Three Months Ended September 30, |
|
2021 |
|
2020 |
|
Fiber Solutions |
|
Small Cells |
|
Total |
|
Fiber Solutions |
|
Small Cells |
|
Total |
Site rental revenues |
$ |
327 |
|
|
$ |
152 |
|
|
$ |
479 |
|
|
$ |
323 |
|
|
$ |
139 |
|
|
$ |
462 |
|
(a) Exclusive of depreciation,
amortization and accretion shown separately.(b) Segment
cost of operations excludes (1) stock-based compensation expense of
$6 million in each of the three months ended September 30,
2021 and 2020 (2) prepaid lease purchase price adjustments of $4
million and $5 million for the three months ended
September 30, 2021 and 2020, respectively. Selling, general
and administrative expenses exclude stock-based compensation
expense of $27 million in each of the three months ended
September 30, 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.
SEGMENT OPERATING RESULTS |
|
Nine Months Ended September 30, 2021 |
|
Nine Months Ended September 30, 2020 |
|
Towers |
|
Fiber |
|
Other |
|
Consolidated Total |
|
Towers |
|
Fiber |
|
Other |
|
Consolidated Total |
Segment site rental revenues |
$ |
2,819 |
|
|
$ |
1,426 |
|
|
|
|
$ |
4,245 |
|
|
$ |
2,612 |
|
|
$ |
1,356 |
|
|
|
|
$ |
3,968 |
|
Segment services and other
revenues |
427 |
|
|
14 |
|
|
|
|
441 |
|
|
367 |
|
|
12 |
|
|
|
|
379 |
|
Segment revenues |
3,246 |
|
|
1,440 |
|
|
|
|
4,686 |
|
|
2,979 |
|
|
1,368 |
|
|
|
|
4,347 |
|
Segment site rental costs of
operations |
659 |
|
|
485 |
|
|
|
|
1,144 |
|
|
648 |
|
|
447 |
|
|
|
|
1,095 |
|
Segment services and other
costs of operations |
285 |
|
|
10 |
|
|
|
|
295 |
|
|
311 |
|
|
8 |
|
|
|
|
319 |
|
Segment costs of
operations(a)(b) |
944 |
|
|
495 |
|
|
|
|
1,439 |
|
|
959 |
|
|
455 |
|
|
|
|
1,414 |
|
Segment site rental gross
margin(c) |
2,160 |
|
|
941 |
|
|
|
|
3,101 |
|
|
1,964 |
|
|
909 |
|
|
|
|
2,873 |
|
Segment services and other
gross margin(c) |
142 |
|
|
4 |
|
|
|
|
146 |
|
|
56 |
|
|
4 |
|
|
|
|
60 |
|
Segment selling, general and
administrative expenses(b) |
78 |
|
|
133 |
|
|
|
|
211 |
|
|
71 |
|
|
137 |
|
|
|
|
208 |
|
Segment operating
profit(c) |
2,224 |
|
|
812 |
|
|
|
|
3,036 |
|
|
1,949 |
|
|
776 |
|
|
|
|
2,725 |
|
Other selling, general and
administrative expenses(b) |
|
|
|
|
$ |
205 |
|
|
205 |
|
|
|
|
|
|
$ |
198 |
|
|
198 |
|
Stock-based compensation
expense |
|
|
|
|
100 |
|
|
100 |
|
|
|
|
|
|
106 |
|
|
106 |
|
Depreciation, amortization and
accretion |
|
|
|
|
1,229 |
|
|
1,229 |
|
|
|
|
|
|
1,207 |
|
|
1,207 |
|
Interest expense and
amortization of deferred financing costs |
|
|
|
|
493 |
|
|
493 |
|
|
|
|
|
|
521 |
|
|
521 |
|
Other (income) expenses to
reconcile to income (loss) before income taxes(d) |
|
|
|
|
184 |
|
|
184 |
|
|
|
|
|
|
129 |
|
|
129 |
|
Income (loss) before income
taxes |
|
|
|
|
|
|
$ |
825 |
|
|
|
|
|
|
|
|
$ |
564 |
|
FIBER SEGMENT SITE RENTAL REVENUES SUMMARY |
|
Nine Months Ended September 30, |
|
2021 |
|
2020 |
|
Fiber Solutions |
|
Small Cells |
|
Total |
|
Fiber Solutions |
|
Small Cells |
|
Total |
Site rental revenues |
$ |
987 |
|
|
$ |
439 |
|
|
$ |
1,426 |
|
|
$ |
950 |
|
|
$ |
406 |
|
|
$ |
1,356 |
|
(a) Exclusive of depreciation,
amortization and accretion shown separately.(b) Segment
cost of operations excludes (1) stock-based compensation expense of
$16 million and $19 million for the nine months ended
September 30, 2021 and 2020, respectively and (2) prepaid lease
purchase price adjustments of $14 million in each of the nine
months ended September 30, 2021 and 2020. Selling, general and
administrative expenses exclude stock-based compensation expense of
$84 million and $87 million for the nine months ended
September 30, 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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