Nov. 3, 2009 (GlobeNewswire) --
HOUSTON, Nov. 3, 2009 (GLOBE NEWSWIRE) -- Crown Castle International Corp. (NYSE:CCI) today reported results for the quarter ended September 30, 2009.
"We had another excellent quarter of record results, exceeding the high-end of our third quarter Outlook for site rental revenue, site rental gross margin, Adjusted EBITDA, and recurring cash flow," stated Ben Moreland, President and Chief Executive Officer of Crown Castle. "We are experiencing solid growth in our business and remain excited about the strong fundamentals underlying our industry, driven by the increasing demand for wireless communication services, including fourth generation wireless data services. Along with the third quarter results, we are announcing our full year 2010 Outlook, which suggests recurring cash flow growth of approximately 16%."
CONSOLIDATED FINANCIAL RESULTS
Total revenue for the third quarter of 2009 increased 12% to $429.1 million from $384.3 million in the same period in 2008. Site rental revenue for the third quarter of 2009 increased $42.5 million, or 12%, to $396.5 million from $354.0 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 $43.3 million, or 18%, to $281.6 million in the third quarter of 2009 from $238.2 million in the same period in 2008. Adjusted EBITDA for the third quarter of 2009 increased $42.8 million, or 20%, to $260.5 million from $217.7 million in the same period in 2008.
Recurring cash flow, defined as Adjusted EBITDA less interest expense and sustaining capital expenditures, increased 16% from $123.5 million in the third quarter of 2008 to $143.8 million for the third quarter of 2009. Weighted average common shares outstanding was 286.7 million for the third quarter of 2009, as compared to 283.6 million for the same period in the prior year. Recurring cash flow per share, defined as recurring cash flow divided by weighted average common shares outstanding, was $0.50 in the third quarter of 2009, up 15% compared to $0.44 in the third quarter of 2008.
Net loss attributable to CCIC stockholders was $31.6 million for the third quarter of 2009, inclusive of $58.3 million of losses on interest rate swaps, compared to a net loss attributable to CCIC stockholders of $32.2 million for the same period in 2008. Net loss attributable to CCIC stockholders after deduction of dividends on preferred stock was $36.8 million in the third quarter of 2009, compared to a net loss attributable to CCIC stockholders after deduction of dividends on preferred stock of $37.4 million for the same period in 2008. Net loss attributable to CCIC common stockholders per common share was $0.13 for each of the third quarter of 2009 and the third quarter 2008.
FINANCING AND INVESTING ACTIVITIES
"I am very pleased with our third quarter results, our ability to increase our Outlook for the balance of 2009 and our continued successful financing activities," stated Jay Brown, Chief Financial Officer of Crown Castle. "Our recently completed $500 million of 7.125% senior notes, together with the $2.35 billion we refinanced earlier this year, have allowed us to extend our debt maturities over multiple years and eliminated any requirement to access the credit markets for almost five years. Furthermore, based on the improved credit markets, we believe our current refinancing options for the remaining portion of our debt have been greatly enhanced. As we look forward to 2010, I anticipate we will be in a position to resume investing the majority of our cash flow in activities, such as share purchases, tower acquisitions and land purchases that we believe will increase long-term recurring cash flow per share."
During the third quarter of 2009, Crown Castle issued $250 million of senior secured notes in two classes, A-1 and A-2. The Class A-1 Notes consist of $175 million of 6.25% Notes that fully amortize during the period beginning in January 2010 and ending on the final maturity date in August 2019. The Class A-2 Notes consist of $75 million of 9.0% Notes that fully amortize during the period beginning in September 2019 and ending on the final maturity date in August 2029. In July 2009, the proceeds of these notes were used to repay, in full, $221.5 million of previously outstanding Commercial Mortgage Pass-Through Certificates, Series 2004-2, issued in 2004 by Global Signal Trust II and due in December 2009.
Also, during the third quarter of 2009, Crown Castle purchased, at par, $186.5 million of the Senior Secured Tower Revenue Notes, Series 2005-1 due in June 2035 ("June 2035 Notes"). Since October 1, 2009, Crown Castle has purchased, at par, $6.3 million of the June 2035 Notes. Pro forma for these purchases, Crown Castle has $1,691.4 million of June 2035 Notes outstanding.
On October 20, 2009, Crown Castle issued $500 million of 7.125% senior notes due in 2019. The proceeds of these notes will be used for general corporate purposes, which may include the repayment or repurchase of certain outstanding indebtedness of its subsidiaries.
As of September 30, 2009, pro forma for the completion of the $500 million of 7.125% senior notes offering, and after taking into account the aforementioned purchases in October by Crown Castle of the June 2035 Notes, Crown Castle has approximately $750 million in cash and cash equivalents (excluding restricted cash) and $188 million of availability under its $188 million revolving credit facility.
During the third quarter of 2009, Crown Castle invested approximately $32.4 million in capital expenditures. Capital expenditures were comprised of $5.5 million of sustaining capital expenditures and $26.9 million of revenue generating capital expenditures, of which $1.0 million was spent on land purchases, $21.2 million on existing sites and $4.7 million on the construction and acquisition of new sites.
In addition to the tables and information contained in this press release, Crown Castle will post supplemental information on its website at http://investor.crowncastle.com that will be discussed during its conference call tomorrow morning, Wednesday November 4, 2009.
OUTLOOK
This Outlook section contains forward-looking statements, and actual results may differ materially. Information regarding potential risks which could cause actual results to differ from the forward-looking statements herein is set forth below and in Crown Castle's filings with the Securities and Exchange Commission ("SEC").
The following Outlook table is based on current expectations and assumptions. The Outlook table includes the interest expense associated with the $500 million of 7.125% senior notes issued in October 2009, and assumes a US dollar to Australian dollar exchange rate of 0.88 US dollars to 1.00 Australian dollar for fourth quarter 2009 and full year 2010 Outlook.
For the purposes of this Outlook, interest expense is based on interest charges on debt outstanding as of November 3, 2009 and does not assume additional debt repayments beyond the aforementioned purchases disclosed in this release.
As reflected in the following table, Crown Castle has increased the midpoint of its full year 2009 Outlook, previously issued on July 29, 2009, for site rental revenue by $14.5 million, site rental gross margin by $17.5 million, Adjusted EBITDA by $20.5 million and recurring cash flow by $20.5 million.
The following table sets forth Crown Castle's current Outlook for the fourth quarter of 2009, full year 2009 and full year 2010:
(in millions,
except per Fourth Quarter
share amounts) 2009 Full Year 2009 Full Year 2010
---------------- ------------------ ----------------
Site rental
revenue $397 to $402 $1,537 to $1,542 $1,645 to $1,665
Site rental
cost of
operations $115 to $120 $453 to $458 $460 to $480
Site rental
gross margin $280 to $285 $1,083 to $1,088 $1,175 to $1,195
Adjusted EBITDA $259 to $264 $1,008 to $1,013 $1,095 to $1,115
Interest expense
and
amortization
of deferred
financing
costs(a) $117 to $121 $444 to $448 $448 to $458
Sustaining
capital
expenditures $10 to $12 $26 to $28 $27 to $32
Recurring cash
flow $129 to $134 $536 to $541 $612 to $632
Net income
(loss) after
deduction of
dividends on
preferred
stock $(15) to $7 $(165) to $(142) $(16) to $68
Net income
(loss) per
share(b) $(0.05) to $0.02 $(0.58) to $(0.49) $(0.06) to $0.24
(a) Inclusive of approximately $18 million, $62 million, and
$52 million, respectively, of non-cash expense.
(b) Represents net income (loss) per common share, based on 286.9
million shares outstanding as of September 30, 2009.
CONFERENCE CALL DETAILS
Crown Castle has scheduled a conference call for Wednesday, November 4, 2009, at 10:30 a.m. eastern time. The conference call may be accessed by dialing 480-629-9031 and asking for the Crown Castle call at least 30 minutes prior to the start time. The conference call may also be accessed live over the Internet by logging onto the web at http://investor.crowncastle.com. Any supplemental materials for the call will be posted at the Crown Castle website at http://investor.crowncastle.com.
A telephonic replay of the conference call will be available from 12:30 p.m. eastern time on Wednesday, November 4, 2009, through 11:59 p.m. eastern time on Thursday, November 12, 2009, and may be accessed by dialing 303-590-3030 using access code 4173226. An audio archive will also be available on the company's website at http://investor.crowncastle.com shortly after the call and will be accessible for approximately 90 days.
Crown Castle owns, operates, and leases towers and other communication structures for wireless communications. Crown Castle offers significant wireless communications coverage to 91 of the top 100 US markets and to substantially all of the Australian population. Crown Castle owns, operates and manages over 22,000 and approximately 1,600 wireless communication sites in the US and Australia, respectively. For more information on Crown Castle, please visit http://www.crowncastle.com.
The Crown Castle International Corp. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=3063
The components of interest expense and amortization of deferred financing costs are as follows:
For the Three
Months Ended
-------------------
Sept. 30, Sept. 30,
2009 2008
-------- --------
(in millions)
Interest expense on debt obligations $ 94.2 $ 81.9
Amortization of deferred financing costs 6.8 3.8
Amortization of discounts on long-term debt 3.5 --
Amortization of interest rate swaps 6.1 0.8
Amortization of purchase price adjustments on
long-term debt 0.1 0.9
Other 0.5 0.7
-------- --------
$ 111.2 $ 88.1
======== ========
The components of interest expense and amortization of deferred financing costs are forecasted as follows:
Q4 2009 Full Year Full Year
Outlook 2009 Outlook 2010 Outlook
------------ ------------ ------------
(in millions)
Interest expense on debt
obligations $100 to $102 $382 to $387 $392 to $412
Amortization of deferred
financing costs $6 to $8 $26 to $28 $17 to $22
Amortization of discounts
on long-term debt $3 to $4 $11 to $13 $14 to $16
Amortization of interest
rate swaps $5 to $7 $18 to $20 $5 to $25
Amortization of purchase
price adjustments on long-
term debt -- $1 to $2 --
Other $0 to $1 $1 to $3 $1 to $3
------------ ------------ ------------
$117 to $121 $444 to $448 $448 to $458
============ ============ ============
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 restructuring charges (credits), asset write-down charges, acquisition and integration costs, depreciation, amortization and accretion, interest expense and amortization of deferred financing costs, gains (losses) on purchases and redemptions of debt, net gain (loss) on interest rate swaps, impairment of available-for-sale securities, interest and other income (expense), benefit (provision) for income taxes, cumulative effect of change in accounting principle, income (loss) from discontinued operations and stock-based compensation expense. Adjusted EBITDA is not intended as an alternative measure of operating results or cash flow from operations (as determined in accordance with Generally Accepted Accounting Principles ("GAAP")).
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. We define sustaining capital expenditures as capital expenditures (determined in accordance with GAAP) which do not increase the capacity or life of our revenue generating assets and include capitalized costs related to (i) maintenance activities on our towers, (ii) vehicles, (iii) information technology equipment, and (iv) office equipment. Recurring cash flow is not intended as an alternative measure of cash flow from operations or operating results (as determined in accordance with GAAP).
Adjusted EBITDA and recurring cash flow are presented as additional information because management believes these measures are useful indicators of the financial performance of our core businesses. In addition, Adjusted EBITDA is a measure of current financial performance used in our debt covenant calculations. Our measures of Adjusted EBITDA and recurring cash flow may not be comparable to similarly titled measures of other companies, including other companies in the tower sector.
