Crown Castle Inc. (NYSE: CCI) ("Crown Castle") today reported
results for the third quarter ended September 30, 2023 and
issued its full year 2024 outlook, as reflected in the table below.
|
Full Year 2024 |
|
Full Year 2023 |
(dollars in millions, except per share amounts) |
Current OutlookMidpoint(a) |
Midpoint GrowthRate Comparedto Previous YearOutlook |
|
Current OutlookMidpoint(a) |
|
Midpoint GrowthRate Comparedto Previous YearActual |
Site rental revenues |
$6,370 |
(2)% |
|
$6,511 |
4% |
Net income (loss) |
$1,253 |
(15)% |
|
$1,469 |
(12)% |
Net income (loss) per
share—diluted |
$2.88 |
(15)% |
|
$3.38 |
(12)% |
Adjusted EBITDA(b) |
$4,163 |
(6)% |
|
$4,422 |
2% |
AFFO(b) |
$3,005 |
(8)% |
|
$3,279 |
2% |
AFFO per share(b) |
$6.91 |
(8)% |
|
$7.54 |
2% |
(a) As issued on October 18,
2023.(b) See "Non-GAAP Measures and Other
Information" for further information and reconciliation of non-GAAP
financial measures to net income (loss), including on a per share
basis.
"Our third quarter results continue to
demonstrate the resiliency of our business, allowing us to keep our
full year 2023 outlook consistent with expectations of 5% tower
organic revenue growth and delivering on 10,000 small cell nodes,"
stated Jay Brown, Crown Castle's Chief Executive Officer. "Based on
our customers' continued investments to meet increasing data
demand, we expect full year 2024 organic growth excluding the
impact of Sprint Cancellations of 4.5% from towers, 13% from small
cells, based on plans to deliver approximately 14,000 small cell
nodes, and 3% from fiber solutions to generate consolidated organic
revenue growth of 5%. To achieve this growth, we plan to deploy
discretionary capital, net of prepaid rent additions of $430
million, totaling approximately $1.2 billion which we expect to
fund without issuing equity in 2024. As we work through discrete
headwinds in 2024 and 2025, the strong underlying growth across our
business gives us confidence in our ability to grow our dividend
beyond 2025 and maintain our current annualized dividend of $6.26
per share. We expect the low-point of AFFO to occur during the
first half of 2024, with growth expected in the second half of the
year and beyond."
"We continue to focus on our strategy to deliver
the highest risk-adjusted returns for our shareholders and have
established a comprehensive portfolio of towers, small cells and
fiber, providing unique exposure to growth throughout the entire
wireless upgrade cycle. We believe our ability to capture the
rising growth in small cell demand while continuing to generate
solid tower growth results from the portfolio of assets and core
capabilities we have established as the largest operator of shared
communications infrastructure in the United States."
RESULTS FOR THE QUARTERThe
table below sets forth select financial results for the quarters
ended September 30, 2023 and September 30, 2022.
|
|
(dollars in millions, except per share amounts) |
Q3 2023 |
Q3 2022 |
Change |
% Change |
Site rental revenues |
$1,577 |
$1,568 |
$9 |
1% |
Net income (loss) |
$265 |
$419 |
$(154) |
(37)% |
Net income (loss) per
share—diluted |
$0.61 |
$0.97 |
$(0.36) |
(37)% |
Adjusted EBITDA(a) |
$1,047 |
$1,077 |
$(30) |
(3)% |
AFFO(a) |
$767 |
$804 |
$(37) |
(5)% |
AFFO per share(a) |
$1.77 |
$1.85 |
$(0.08) |
(4)% |
(a) See "Non-GAAP Measures and
Other Information" for further information and reconciliation of
non-GAAP financial measures to net income (loss), including on a
per share basis.
HIGHLIGHTS FROM THE QUARTER
- Site rental
revenues. Site rental revenues grew 1%, or $9 million,
from third quarter 2022 to third quarter 2023, inclusive of
approximately $53 million in Organic Contribution to Site Rental
Billings, a $31 million decrease in straight-lined revenues,
and a $14 million decrease in amortization of prepaid rent.
The $53 million in Organic Contribution to Site Rental Billings
represents 3.9% growth and was not materially impacted by the
Sprint Cancellations.
- Net income. Net
income for the third quarter 2023 was $265 million compared to $419
million for the third quarter 2022, and included $72 million of
charges incurred in the quarter related to our restructuring plan
announced in July 2023.
- Adjusted EBITDA.
Third quarter 2023 Adjusted EBITDA was $1.05 billion compared to
$1.08 billion for the third quarter 2022. The decrease in the
quarter was primarily a result of $35 million of lower services
contribution, partially offset by lower expenses.
- AFFO and AFFO per
share. Third quarter 2023 AFFO was $767 million, or $1.77
per share, representing a decrease from the third quarter 2022 of
5% and 4%, respectively. The decrease in the quarter was primarily
a result of the lower contribution from Adjusted EBITDA and higher
interest expense compared to third quarter 2022.
- Capital
expenditures. Capital expenditures during the quarter were
$347 million, comprised of $22 million of sustaining capital
expenditures and $325 million of discretionary capital
expenditures. Discretionary capital expenditures during the quarter
included approximately $273 million attributable to Fiber and
approximately $47 million attributable to Towers.
- Common stock
dividend. During the quarter, Crown Castle paid common
stock dividends of approximately $680 million in the aggregate, or
$1.565 per common share, an increase of 6.5% on a per share basis
compared to the same period a year ago.
- Financing
activity. In July, Crown Castle repaid in full the
previously outstanding 3.150% senior unsecured notes upon scheduled
maturity. The aggregate principal repayment of $750 million was
funded with its revolving credit facility.
"With third quarter results in line with
expectations, we remain on track with our full year 2023 outlook
and are seeing the benefits of our comprehensive offering of
domestic shared infrastructure assets in our full year 2024
outlook, highlighted by projected consolidated organic revenue
growth of 5%, excluding the impact of payments for Sprint
Cancellations," stated Dan Schlanger, Crown Castle's Chief
Financial Officer. "The strong organic growth across each of our
businesses is expected to contribute approximately $220 million to
2024 Adjusted EBITDA compared to 2023. However, this growth is
expected to be more than offset by a combined $240 million
reduction to our straight-lined revenues and amortization of
prepaid rent and an additional $165 million reduction related to
2023 payments from Sprint Cancellations not recurring in 2024."
"Since achieving an investment grade credit
rating in 2015, we have intentionally strengthened our balance
sheet to mitigate risk by extending our weighted average debt
maturity from 5 years to 8 years, decreasing the percentage of
secured debt from 47% to 7% and increasing the percentage of fixed
rate debt from 68% to 86%. Further, we ended the third quarter with
approximately $5 billion of available liquidity under our revolving
credit facility and only $750 million of debt maturities occurring
through 2024."
MANAGEMENT CHANGESAdditionally,
Crown Castle announced today that Mr. Schlanger, Executive Vice
President and Chief Financial Officer, will depart the company
effective March 31, 2024. "Dan has been a valuable member of our
executive leadership team and has made significant contributions
over his seven years with the company," said Mr. Brown. "Dan has
been integral to our strategy and the growth of our business, built
a strong finance organization, and improved our balance sheet with
long-dated maturities. I wish him well in his next endeavors."
Crown Castle will begin a search for Mr. Schlanger's replacement.
The search will include both internal and external candidates.
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.
Restructuring Plan Update
- Crown Castle has undertaken a
significant effort to simplify, streamline and centralize our
business processes and operations to reduce our long-term costs and
improve our customers’ experience, the beginning of which was the
restructuring plan we announced in July 2023. Annual run rate
savings from that restructuring plan are expected to be $105
million, comprised of $30 million of anticipated savings in 2023,
$35 million of expected savings in 2024, and $40 million of
expected savings included in the 2024 Outlook for services
margin.
- In addition to the previously
announced restructuring plan, Crown Castle plans to relocate
approximately 1,000 employee positions from several locations
nationwide to a centralized location by the end of the third
quarter 2024. Crown Castle intends to continue to maintain local
offices across the United States to support its customers'
deployment activities. Additional long-term cost savings and
related restructuring charges, which may be significant, are
expected from the expanded consolidation but not included in the
full year 2024 Outlook. The additional anticipated cost savings and
related restructuring charges will be provided as they become
available.
The following table sets forth Crown Castle's
current full year 2023 and 2024 Outlook. Changes to the full year
2023 Outlook from the previous full year 2023 Outlook are limited
to net income, which has been updated to reflect expected charges
related to the restructuring plan announced in July 2023, and a
$100 million reduction to expected discretionary capital
expenditures in Towers.
(in millions, except per share amounts) |
Current Full Year 2023(a) |
Current Full Year 2023 Outlook Midpoint(a) |
Full Year 2024 Outlook(a) |
Full Year 2024 Outlook Midpoint(a) |
Site rental billings(b) |
$5,631 to $5,671 |
$5,651 |
$5,740 to $5,780 |
$5,760 |
Amortization of prepaid
rent |
$570 to $580 |
$575 |
$410 to $435 |
$423 |
Straight-lined revenues |
$264 to $284 |
$274 |
$175 to $200 |
$187 |
Site rental revenues |
$6,488 to $6,533 |
$6,511 |
$6,347 to $6,392 |
$6,370 |
Site rental costs of
operations(c) |
$1,633 to $1,678 |
$1,656 |
$1,686 to $1,731 |
$1,709 |
Services and other gross
margin |
$120 to $150 |
$135 |
$65 to $95 |
$80 |
Net income (loss) |
$1,429 to $1,509 |
$1,469 |
$1,213 to $1,293 |
$1,253 |
Net income (loss) per
share—diluted |
$3.29 to $3.47 |
$3.38 |
$2.79 to $2.97 |
$2.88 |
Adjusted EBITDA(d) |
$4,399 to $4,444 |
$4,422 |
$4,138 to $4,188 |
$4,163 |
Depreciation, amortization and
accretion |
$1,712 to $1,807 |
$1,760 |
$1,680 to $1,775 |
$1,728 |
Interest expense and
amortization of deferred financing costs, net(e) |
$834 to $869 |
$852 |
$933 to $978 |
$956 |
FFO(d) |
$3,183 to $3,218 |
$3,201 |
$2,951 to $2,996 |
$2,974 |
AFFO(d) |
$3,261 to $3,296 |
$3,279 |
$2,980 to $3,030 |
$3,005 |
AFFO per share(d) |
$7.50 to $7.58 |
$7.54 |
$6.85 to $6.97 |
$6.91 |
(a) As issued on October 18,
2023.(b) See "Non-GAAP Measures and Other
Information" for our definition of site rental
billings.(c) Exclusive of depreciation,
amortization and accretion.(d) See "Non-GAAP
Measures and Other Information" for further information and
reconciliation of non-GAAP financial measures to net income (loss),
including on a per share basis.(e) See "Non-GAAP
Measures and Other Information" for the reconciliation of "Outlook
for Components of Interest Expense."
- Expected net income for full year
2023 is $1.4 billion to $1.5 billion, as compared to our prior full
year outlook of $1.5 billion to $1.6 billion. The reduction in 2023
net income is due to an expected $102 million to $122 million of
charges related to the restructuring plan announced in July
2023.
- The chart below reconciles the components contributing to the
change in site rental revenues from 2023 to 2024 of ($170) million
to ($130) million, inclusive of expected Organic Contributions to
Site Rental Billings of $70 million to $110 million, or $245
million to $285 million excluding the impact of Sprint
Cancellations. Expected full year consolidated site rental billings
growth is 2%, inclusive of 4.5% growth from towers, 9% decline from
small cells, and 3% decline from fiber solutions. Excluding the
expected impact of Sprint Cancellations, full year 2024 growth is
expected to be 5%, inclusive of 4.5% from towers, 13% from small
cells, and 3% from fiber solutions.
- Core leasing activity for full year
2024 is expected to contribute $305 million to $335 million,
consisting of $105 million to $115 million from towers (compared to
$125 million to $135 million in full year 2023), $55 million to $65
million from small cells (compared to $30 million to $40 million in
full year 2023), and $145 to $155 million from fiber solutions
(compared to $120 million to $130 million in full year 2023).
- Payments from Sprint Cancellations
are expected to be $160 million to $170 million in full year 2023
and are non-recurring, reducing full year Organic Contribution to
Site Rental Billings growth by the same amount in 2024.
- Full year 2024 straight-line site
rental revenues is expected to be approximately $75 million to $100
million lower than expected full year 2023, reflecting the
significant portion of our tower growth that is already
contracted.
- Prepaid rent amortization is
expected to decrease by approximately $140 million to $165 million,
with approximately a $95 million reduction in Towers and $55
million in Fiber, which includes a reduction of approximately $50
million associated with the Sprint Cancellations.
- The chart below reconciles the
components contributing to the expected decrease of $240 million to
$290 million to 2024 AFFO.
- The expected increase in full year
2024 expenses reflects cost increases of approximately 3%,
partially offset by approximately $35 million of lower expense
growth compared to full year 2023 related to the restructuring plan
announced in July 2023.
- The services contribution in full
year 2024 is expected to decrease by approximately $40 million to
$70 million due to lower Towers activity levels. The exit from the
installation services is expected to have a neutral impact on the
services contribution for full year 2024 as the decrease in
installation services margin is expected to be offset by a $40
million reduction in installation-related indirect costs.
- Interest expense for full year 2024
is expected to be $85 million to $130 million higher than projected
in full year 2023 Outlook, primarily related to incremental debt
financing to fund discretionary capital expenditures in 2024.
Outlook for Discretionary Capital
Expenditures and Prepaid Rent Additions
- Full year 2023 discretionary
capital expenditures are expected to be $1.3 billion to $1.4
billion, including $1.1 billion to $1.2 billion in the fiber
segment and $200 million in the tower segment. Full year 2023
prepaid rent additions are expected to be $400 million, including
$300 million from fiber and $100 million from towers.
- Full year 2024 discretionary
capital expenditures are expected to be $1.5 billion to $1.6
billion in 2024, including approximately $1.4 billion in the Fiber
segment and $180 million in the Towers segment. Full year 2024
prepaid rent additions are expected to be approximately $430
million in 2024, including $350 million from Fiber and $80 million
from Towers.
- The increase in discretionary
capital expenditures for full year 2024 primarily reflects the
expected increase in small cell deployments to approximately 14,000
in 2024 compared to approximately 10,000 expected in 2023,
demonstrating further capital efficiency gains as we expect to
increase node construction by approximately 40% while increasing
capital requirements by only approximately 20%.
Additional information is available in Crown
Castle's quarterly Supplemental Information Package posted in the
Investors section of our website.
CONFERENCE CALL DETAILS Crown
Castle has scheduled a conference call for Thursday, October 19,
2023, at 10:30 a.m. Eastern time to discuss its third quarter 2023
results. A listen only live audio webcast of the conference call,
along with supplemental materials for the call, can be accessed on
the Crown Castle website at https://investor.crowncastle.com.
Participants may join the conference call by dialing 833-816-1115
(Toll Free) or 412-317-0694 (International) at least 30 minutes
prior to the start time. All dial-in participants should ask to
join the Crown Castle call.
A replay of the webcast will be available on the
Investor page of Crown Castle's website until end of day, Saturday,
October 19, 2024.
ABOUT CROWN CASTLECrown Castle
owns, operates and leases more than 40,000 cell towers and
approximately 85,000 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.
Non-GAAP Measures and Other
Information
This press release includes presentations of
Adjusted EBITDA, Adjusted Funds from Operations ("AFFO"), including
per share amounts, Funds from Operations ("FFO"), including per
share amounts, Organic Contribution to Site Rental Billings,
including as Adjusted for Impact of Sprint Cancellations, and Net
Debt, 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 site
rental revenues and 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:
- 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. Adjusted EBITDA should be considered only as a
supplement to net income (loss) 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 (1) asset base (primarily depreciation,
amortization and accretion) and (2) 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 revenues or
expenses are 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. AFFO should be
considered only as a supplement to net income (loss) computed in
accordance with GAAP as a measure of our performance and should not
be considered as an alternative to cash flow 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 real estate 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 (loss)
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 Billings 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 Organic Contribution to Site
Rental Billings to assess year-over-year growth rates for our
rental activities, to evaluate current performance, to capture
trends in rental rates, core leasing activities and tenant
non-renewals in our core business, as well as to forecast future
results. Separately, we are also disclosing Organic Contribution to
Site Rental Billings as Adjusted for Impact of Sprint
Cancellations, which is outside of ordinary course, to provide
further insight into our results of operations and underlying
trends. Management believes that identifying the impact for Sprint
Cancellations provides increased transparency and comparability
across periods. Organic Contribution to Site Rental Billings
(including as Adjusted for Impact of Sprint Cancellations) 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.
- Net Debt is useful
to investors or other interested parties in evaluating our overall
debt position and future debt capacity. Management uses Net Debt in
assessing our leverage. Net Debt is not meant as an alternative
measure of debt and should be considered only as a supplement in
understanding and assessing our leverage.
Non-GAAP Financial Measures
Adjusted EBITDA. We define Adjusted EBITDA as
net income (loss) 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, net, (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, net (income) loss
from discontinued operations, (gain) loss on sale of discontinued
operations, cumulative effect of a change in accounting principle
and stock-based compensation expense, net.
AFFO. We define AFFO as FFO before
straight-lined revenues, straight-lined expenses, stock-based
compensation expense, net, 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), net (income)
loss from discontinued operations, (gain) loss on sale of
discontinued operations, cumulative effect of a change in
accounting principle and adjustments for noncontrolling interests,
less sustaining capital expenditures.
AFFO per share. We define AFFO per share as AFFO
divided by diluted weighted-average common shares outstanding.
FFO. We define FFO as net income (loss) 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 common
stockholders.
FFO per share. We define FFO per share as FFO
divided by diluted weighted-average common shares outstanding.
Organic Contribution to Site Rental Billings. We
define Organic Contribution to Site Rental Billings as the sum of
the change in site rental revenues related to core leasing
activity, escalators and payments for Sprint Cancellations, less
non-renewals of tenant contracts and non-renewals associated with
Sprint Cancellations. Additionally, Organic Contribution to Site
Rental Billings as Adjusted for Impact of Sprint Cancellations
reflects Organic Contribution to Site Rental Billings less payments
for Sprint Cancellations, plus non-renewals associated with Sprint
Cancellations.
Net Debt. We define Net Debt as (1) debt and
other long-term obligations and (2) current maturities of debt and
other obligations, excluding unamortized adjustments, net; less
cash, cash equivalents and restricted cash.
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, net and amortization of prepaid lease
purchase price adjustments recorded in consolidated site rental
costs of operations.
Segment services and other gross margin. We
define segment services and other gross margin as segment services
and other revenues less segment services and other costs of
operations, excluding stock-based compensation expense, net
recorded in consolidated services and other costs of
operations.
Segment operating profit. We define segment
operating profit as segment site rental gross margin plus segment
services and other gross margin, less segment selling, general and
administrative expenses.
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 Definitions
Site rental billings. We define site rental
billings as site rental revenues exclusive of the impacts from (1)
straight-lined revenues, (2) amortization of prepaid rent in
accordance with GAAP and (3) contribution from recent acquisitions
until the one-year anniversary of such acquisitions.
Core leasing activity. We define core leasing
activity as site rental revenues growth from tenant additions
across our entire portfolio and renewals or extensions of tenant
contracts, exclusive of (1) the impacts from both straight-lined
revenues and amortization of prepaid rent in accordance with GAAP
and (2) payments for Sprint Cancellations, where applicable.
Non-renewals. We define non-renewals of tenant
contracts as the reduction in site rental revenues as a result of
tenant churn, terminations and, in limited circumstances,
reductions of existing lease rates, exclusive of non-renewals
associated with Sprint Cancellations, where applicable.
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 discretionary 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.
Sprint Cancellations. We define Sprint
Cancellations as lease cancellations related to the previously
disclosed T-Mobile US, Inc. and Sprint network consolidation as
described in our press release dated April 19, 2023.
Reconciliation of Historical Adjusted
EBITDA:
|
For the Three Months Ended |
|
For the Nine Months Ended |
|
For the Twelve Months Ended |
(in millions; totals may not
sum due to rounding) |
September 30, 2023 |
|
September 30, 2022 |
|
September 30, 2023 |
|
September 30, 2022 |
|
December 31, 2022 |
Net income (loss) |
$ |
265 |
|
|
$ |
419 |
|
|
$ |
1,139 |
|
|
$ |
1,261 |
|
(a) |
$ |
1,675 |
|
Adjustments to increase
(decrease) net income (loss): |
|
|
|
|
|
|
|
|
|
Asset write-down charges |
|
8 |
|
|
|
3 |
|
|
|
30 |
|
|
|
26 |
|
|
|
34 |
|
Acquisition and integration costs |
|
— |
|
|
|
— |
|
|
|
1 |
|
|
|
1 |
|
|
|
2 |
|
Depreciation, amortization and accretion |
|
439 |
|
|
|
430 |
|
|
|
1,315 |
|
|
|
1,276 |
|
|
|
1,707 |
|
Restructuring charges |
|
72 |
|
|
|
— |
|
|
|
72 |
|
|
|
— |
|
|
|
— |
|
Amortization of prepaid lease purchase price adjustments |
|
4 |
|
|
|
4 |
|
|
|
12 |
|
|
|
12 |
|
|
|
16 |
|
Interest expense and amortization of deferred financing costs,
net(a) |
|
217 |
|
|
|
177 |
|
|
|
627 |
|
|
|
506 |
|
|
|
699 |
|
(Gains) losses on retirement of long-term obligations |
|
— |
|
|
|
2 |
|
|
|
— |
|
|
|
28 |
|
|
|
28 |
|
Interest income |
|
(3 |
) |
|
|
(1 |
) |
|
|
(10 |
) |
|
|
(1 |
) |
|
|
(3 |
) |
Other (income) expense |
|
— |
|
|
|
2 |
|
|
|
4 |
|
|
|
5 |
|
|
|
10 |
|
(Benefit) provision for income taxes |
|
7 |
|
|
|
3 |
|
|
|
21 |
|
|
|
14 |
|
|
|
16 |
|
Stock-based compensation expense, net |
|
36 |
|
|
|
38 |
|
|
|
126 |
|
|
|
121 |
|
|
|
156 |
|
Adjusted EBITDA(b)(c) |
$ |
1,047 |
|
|
$ |
1,077 |
|
|
$ |
3,339 |
|
|
$ |
3,249 |
|
|
$ |
4,340 |
|
Reconciliation of Current Outlook for Adjusted
EBITDA:
|
Full Year 2023 |
|
Full Year 2024 |
(in millions; totals may not
sum due to rounding) |
Outlook(e) |
|
Outlook(e) |
Net income (loss) |
$1,429 |
|
to |
$1,509 |
|
|
$1,213 |
|
to |
$1,293 |
|
Adjustments to increase
(decrease) net income (loss): |
|
|
|
|
|
|
|
Asset write-down charges |
$26 |
|
to |
$36 |
|
|
$42 |
|
to |
$52 |
|
Acquisition and integration costs |
$0 |
|
to |
$8 |
|
|
$0 |
|
to |
$6 |
|
Depreciation, amortization and accretion |
$1,712 |
|
to |
$1,807 |
|
|
$1,680 |
|
to |
$1,775 |
|
Restructuring charges |
$102 |
|
to |
$122 |
|
|
$0 |
|
to |
$0 |
|
Amortization of prepaid lease purchase price adjustments |
$15 |
|
to |
$17 |
|
|
$15 |
|
to |
$17 |
|
Interest expense and amortization of deferred financing costs,
net(d) |
$834 |
|
to |
$869 |
|
|
$933 |
|
to |
$978 |
|
(Gains) losses on retirement of long-term obligations |
$0 |
|
to |
$0 |
|
|
$0 |
|
to |
$0 |
|
Interest income |
$(14) |
|
to |
$(13) |
|
|
$(12) |
|
to |
$(11) |
|
Other (income) expense |
$2 |
|
to |
$7 |
|
|
$0 |
|
to |
$9 |
|
(Benefit) provision for income taxes |
$16 |
|
to |
$24 |
|
|
$20 |
|
to |
$28 |
|
Stock-based compensation expense, net |
$165 |
|
to |
$169 |
|
|
$142 |
|
to |
$146 |
|
Adjusted EBITDA(b)(c) |
$4,399 |
|
to |
$4,444 |
|
|
$4,138 |
|
to |
$4,188 |
|
(a) See the reconciliation of
"Components of Interest Expense" for a discussion of non-cash
interest expense.(b) See discussion and our
definition of Adjusted EBITDA in this "Non-GAAP Measures and Other
Information." (c) The above reconciliation
excludes line items included in our definition which are not
applicable for the periods shown.(d) See the
reconciliation of "Outlook for Components of Interest Expense" for
a discussion of non-cash interest expense. (e) As
issued on October 18, 2023.
Reconciliation of Historical FFO and
AFFO:
|
For the Three Months Ended |
|
For the Nine Months Ended |
|
For the Twelve Months Ended |
(in millions; totals may not
sum due to rounding) |
September 30, 2023 |
|
September 30, 2022 |
|
September 30, 2023 |
|
September 30, 2022 |
|
December 31, 2022 |
Net income (loss) |
$ |
265 |
|
|
$ |
419 |
|
|
$ |
1,139 |
|
|
$ |
1,261 |
|
|
$ |
1,675 |
|
Real estate related depreciation, amortization and accretion |
|
425 |
|
|
|
416 |
|
|
|
1,266 |
|
|
|
1,236 |
|
|
|
1,653 |
|
Asset write-down charges |
|
8 |
|
|
|
3 |
|
|
|
30 |
|
|
|
26 |
|
|
|
34 |
|
FFO(a)(b) |
$ |
698 |
|
|
$ |
838 |
|
|
$ |
2,435 |
|
|
$ |
2,523 |
|
|
$ |
3,362 |
|
Weighted-average common shares outstanding—diluted |
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
|
|
|
|
|
|
|
|
FFO (from above) |
$ |
698 |
|
|
$ |
838 |
|
|
$ |
2,435 |
|
|
$ |
2,523 |
|
|
$ |
3,362 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
|
|
Straight-lined revenues |
|
(59 |
) |
|
|
(90 |
) |
|
|
(222 |
) |
|
|
(325 |
) |
|
|
(410 |
) |
Straight-lined expenses |
|
18 |
|
|
|
18 |
|
|
|
56 |
|
|
|
56 |
|
|
|
73 |
|
Stock-based compensation expense, net |
|
36 |
|
|
|
38 |
|
|
|
126 |
|
|
|
121 |
|
|
|
156 |
|
Non-cash portion of tax provision |
|
4 |
|
|
|
2 |
|
|
|
8 |
|
|
|
4 |
|
|
|
6 |
|
Non-real estate related depreciation, amortization and
accretion |
|
14 |
|
|
|
14 |
|
|
|
49 |
|
|
|
40 |
|
|
|
54 |
|
Amortization of non-cash interest expense |
|
3 |
|
|
|
3 |
|
|
|
11 |
|
|
|
10 |
|
|
|
14 |
|
Other (income) expense |
|
— |
|
|
|
2 |
|
|
|
4 |
|
|
|
5 |
|
|
|
10 |
|
(Gains) losses on retirement of long-term obligations |
|
— |
|
|
|
2 |
|
|
|
— |
|
|
|
28 |
|
|
|
28 |
|
Acquisition and integration costs |
|
— |
|
|
|
— |
|
|
|
1 |
|
|
|
1 |
|
|
|
2 |
|
Restructuring charges |
|
72 |
|
|
|
— |
|
|
|
72 |
|
|
|
— |
|
|
|
— |
|
Sustaining capital expenditures |
|
(21 |
) |
|
|
(23 |
) |
|
|
(54 |
) |
|
|
(65 |
) |
|
|
(95 |
) |
AFFO(a)(b) |
$ |
767 |
|
|
$ |
804 |
|
|
$ |
2,487 |
|
|
$ |
2,398 |
|
|
$ |
3,200 |
|
Weighted-average common shares outstanding—diluted |
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
434 |
|
(a) See discussion and our
definitions of FFO and AFFO in this "Non-GAAP Measures and Other
Information."(b) The above reconciliation excludes
line items included in our definition which are not applicable for
the periods shown.
Reconciliation of Historical FFO and
AFFO per share:
|
For the Three Months Ended |
|
For the Nine Months Ended |
|
For the Twelve Months Ended |
(in millions, except per share
amounts; totals may not sum due to rounding) |
September 30, 2023 |
|
September 30, 2022 |
|
September 30, 2023 |
|
September 30, 2022 |
|
December 31, 2022 |
Net income (loss) |
$ |
0.61 |
|
|
$ |
0.97 |
|
|
$ |
2.62 |
|
|
$ |
2.91 |
|
|
$ |
3.86 |
|
Real estate related depreciation, amortization and accretion |
|
0.98 |
|
|
|
0.96 |
|
|
|
2.92 |
|
|
|
2.85 |
|
|
|
3.81 |
|
Asset write-down charges |
|
0.02 |
|
|
|
0.01 |
|
|
|
0.07 |
|
|
|
0.06 |
|
|
|
0.08 |
|
FFO(a)(b) |
$ |
1.61 |
|
|
$ |
1.93 |
|
|
$ |
5.61 |
|
|
$ |
5.81 |
|
|
$ |
7.75 |
|
Weighted-average common shares outstanding—diluted |
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
|
|
|
|
|
|
|
|
FFO (from above) |
$ |
1.61 |
|
|
$ |
1.93 |
|
|
$ |
5.61 |
|
|
$ |
5.81 |
|
|
$ |
7.75 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
|
|
Straight-lined revenues |
|
(0.14 |
) |
|
|
(0.21 |
) |
|
|
(0.51 |
) |
|
|
(0.75 |
) |
|
|
(0.94 |
) |
Straight-lined expenses |
|
0.04 |
|
|
|
0.04 |
|
|
|
0.13 |
|
|
|
0.13 |
|
|
|
0.17 |
|
Stock-based compensation expense, net |
|
0.08 |
|
|
|
0.09 |
|
|
|
0.29 |
|
|
|
0.28 |
|
|
|
0.36 |
|
Non-cash portion of tax provision |
|
0.01 |
|
|
|
— |
|
|
|
0.02 |
|
|
|
0.01 |
|
|
|
0.01 |
|
Non-real estate related depreciation, amortization and
accretion |
|
0.03 |
|
|
|
0.03 |
|
|
|
0.11 |
|
|
|
0.09 |
|
|
|
0.13 |
|
Amortization of non-cash interest expense |
|
0.01 |
|
|
|
0.01 |
|
|
|
0.03 |
|
|
|
0.02 |
|
|
|
0.03 |
|
Other (income) expense |
|
— |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
|
0.01 |
|
|
|
0.02 |
|
(Gains) losses on retirement of long-term obligations |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.06 |
|
|
|
0.06 |
|
Acquisition and integration costs |
|
— |
|
|
|
0.01 |
|
|
|
— |
|
|
|
— |
|
|
|
0.01 |
|
Restructuring charges |
|
0.17 |
|
|
|
— |
|
|
|
0.17 |
|
|
|
— |
|
|
|
— |
|
Sustaining capital expenditures |
|
(0.05 |
) |
|
|
(0.05 |
) |
|
|
(0.12 |
) |
|
|
(0.15 |
) |
|
|
(0.22 |
) |
AFFO(a)(b) |
$ |
1.77 |
|
|
$ |
1.85 |
|
|
$ |
5.73 |
|
|
$ |
5.52 |
|
|
$ |
7.38 |
|
Weighted-average common shares outstanding—diluted |
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
434 |
|
(a) See discussion and our
definitions of FFO and AFFO, including per share amounts in this
"Non-GAAP Measures and Other Information." (b) 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 2023 |
|
Full Year 2024 |
(in millions; totals may not
sum due to rounding) |
Outlook(a) |
|
Outlook(a) |
Net income (loss) |
$1,429 |
|
to |
$1,509 |
|
|
$1,213 |
|
to |
$1,293 |
|
Real estate related depreciation, amortization and accretion |
$1,666 |
|
to |
$1,746 |
|
|
$1,634 |
|
to |
$1,714 |
|
Asset write-down charges |
$26 |
|
to |
$36 |
|
|
$42 |
|
to |
$52 |
|
FFO(b)(c) |
$3,183 |
|
to |
$3,218 |
|
|
$2,951 |
|
to |
$2,996 |
|
Weighted-average common shares outstanding—diluted |
|
435 |
|
|
|
435 |
|
|
|
|
|
|
|
|
|
FFO (from above) |
$3,183 |
|
to |
$3,218 |
|
|
$2,951 |
|
to |
$2,996 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
Straight-lined revenues |
$(284) |
|
to |
$(264) |
|
|
$(197) |
|
to |
$(177) |
|
Straight-lined expenses |
$61 |
|
to |
$81 |
|
|
$55 |
|
to |
$75 |
|
Stock-based compensation expense, net |
$165 |
|
to |
$169 |
|
|
$142 |
|
to |
$146 |
|
Non-cash portion of tax provision |
$0 |
|
to |
$8 |
|
|
$2 |
|
to |
$17 |
|
Non-real estate related depreciation, amortization and
accretion |
$47 |
|
to |
$62 |
|
|
$46 |
|
to |
$61 |
|
Amortization of non-cash interest expense |
$7 |
|
to |
$17 |
|
|
$9 |
|
to |
$19 |
|
Other (income) expense |
$2 |
|
to |
$7 |
|
|
$0 |
|
to |
$9 |
|
(Gains) losses on retirement of long-term obligations |
$0 |
|
to |
$0 |
|
|
$0 |
|
to |
$0 |
|
Acquisition and integration costs |
$0 |
|
to |
$8 |
|
|
$0 |
|
to |
$6 |
|
Restructuring charges |
$102 |
|
to |
$122 |
|
|
$0 |
|
to |
$0 |
|
Sustaining capital expenditures |
$(88) |
|
to |
$(68) |
|
|
$(85) |
|
to |
$(65) |
|
AFFO(b)(c) |
$3,261 |
|
to |
$3,296 |
|
|
$2,980 |
|
to |
$3,030 |
|
Weighted-average common shares outstanding—diluted |
|
435 |
|
|
|
435 |
|
Reconciliation of Current Outlook for
FFO and AFFO per share:
|
Full Year 2023 |
|
Full Year 2024 |
(in millions, except per share
amounts; totals may not sum due to rounding) |
Outlook per share(a) |
|
Outlook per share(a) |
Net income (loss) |
$3.29 |
|
to |
$3.47 |
|
|
$2.79 |
|
to |
$2.97 |
|
Real estate related depreciation, amortization and accretion |
$3.83 |
|
to |
$4.01 |
|
|
$3.76 |
|
to |
$3.94 |
|
Asset write-down charges |
$0.06 |
|
to |
$0.08 |
|
|
$0.10 |
|
to |
$0.12 |
|
FFO(b)(c) |
$7.32 |
|
to |
$7.40 |
|
|
$6.78 |
|
to |
$6.89 |
|
Weighted-average common shares outstanding—diluted |
|
435 |
|
|
|
435 |
|
|
|
|
|
|
|
|
|
FFO (from above) |
$7.32 |
|
to |
$7.40 |
|
|
$6.78 |
|
to |
$6.89 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
Straight-lined revenues |
$(0.65) |
|
to |
$(0.61) |
|
|
$(0.45) |
|
to |
$(0.41) |
|
Straight-lined expenses |
$0.14 |
|
to |
$0.19 |
|
|
$0.13 |
|
to |
$0.17 |
|
Stock-based compensation expense, net |
$0.38 |
|
to |
$0.39 |
|
|
$0.33 |
|
to |
$0.34 |
|
Non-cash portion of tax provision |
$0.00 |
|
to |
$0.02 |
|
|
$0.00 |
|
to |
$0.04 |
|
Non-real estate related depreciation, amortization and
accretion |
$0.11 |
|
to |
$0.14 |
|
|
$0.11 |
|
to |
$0.14 |
|
Amortization of non-cash interest expense |
$0.02 |
|
to |
$0.04 |
|
|
$0.02 |
|
to |
$0.04 |
|
Other (income) expense |
$0.00 |
|
to |
$0.02 |
|
|
$0.00 |
|
to |
$0.02 |
|
(Gains) losses on retirement of long-term obligations |
$0.00 |
|
to |
$0.00 |
|
|
$0.00 |
|
to |
$0.00 |
|
Acquisition and integration costs |
$0.00 |
|
to |
$0.02 |
|
|
$0.00 |
|
to |
$0.01 |
|
Restructuring charges |
$0.23 |
|
to |
$0.28 |
|
|
$0.00 |
|
to |
$0.00 |
|
Sustaining capital expenditures |
$(0.20) |
|
to |
$(0.16) |
|
|
$(0.20) |
|
to |
$(0.15) |
|
AFFO(b)(c) |
$7.50 |
|
to |
$7.58 |
|
|
$6.85 |
|
to |
$6.97 |
|
Weighted-average common shares outstanding—diluted |
|
435 |
|
|
|
435 |
|
(a) As issued on October 18,
2023.(b) See discussion and our definitions of FFO
and AFFO, including per share amounts in this "Non-GAAP Measures
and Other Information."(c) The above
reconciliation excludes line items included in our definition which
are not applicable for the periods shown.
For Comparative Purposes - Reconciliation of Previous
Outlook for Adjusted EBITDA:
|
Previously Issued |
(in millions; totals may not sum due to rounding) |
Full Year 2023 Outlook(a) |
Net income (loss) |
$1,541 |
|
to |
$1,621 |
|
Adjustments to increase
(decrease) income (loss) from continuing operations: |
|
|
|
Asset write-down charges |
$26 |
|
to |
$36 |
|
Acquisition and integration costs |
$0 |
|
to |
$8 |
|
Depreciation, amortization and accretion |
$1,712 |
|
to |
$1,807 |
|
Amortization of prepaid lease purchase price adjustments |
$15 |
|
to |
$17 |
|
Interest expense and amortization of deferred financing costs,
net(b) |
$834 |
|
to |
$869 |
|
(Gains) losses on retirement of long-term obligations |
$0 |
|
to |
$0 |
|
Interest income |
$(14) |
|
to |
$(13) |
|
Other (income) expense |
$2 |
|
to |
$7 |
|
(Benefit) provision for income taxes |
$16 |
|
to |
$24 |
|
Stock-based compensation expense, net |
$165 |
|
to |
$169 |
|
Adjusted EBITDA(c)(d) |
$4,399 |
|
to |
$4,444 |
|
For Comparative Purposes - Reconciliation of Previous
Outlook for FFO and AFFO:
|
Previously Issued |
|
Previously Issued |
(in millions, except per share
amounts; totals may not sum due to rounding) |
Full Year 2023 Outlook(a) |
|
Full Year 2023 Outlook per share(a) |
Net income (loss) |
$1,541 |
|
to |
$1,621 |
|
|
$3.54 |
|
to |
$3.73 |
|
Real estate related depreciation, amortization and accretion |
$1,666 |
|
to |
$1,746 |
|
|
$3.83 |
|
to |
$4.01 |
|
Asset write-down charges |
$26 |
|
to |
$36 |
|
|
$0.06 |
|
to |
$0.08 |
|
FFO(c)(d) |
$3,295 |
|
to |
$3,330 |
|
|
$7.57 |
|
to |
$7.66 |
|
Weighted-average common shares outstanding—diluted |
|
435 |
|
|
|
435 |
|
|
|
|
|
|
|
|
|
FFO (from above) |
$3,295 |
|
to |
$3,330 |
|
|
$7.57 |
|
to |
$7.66 |
|
Adjustments to increase
(decrease) FFO: |
|
|
|
|
|
|
|
Straight-lined revenues |
$(284) |
|
to |
$(264) |
|
|
$(0.65) |
|
to |
$(0.61) |
|
Straight-lined expenses |
$61 |
|
to |
$81 |
|
|
$0.14 |
|
to |
$0.19 |
|
Stock-based compensation expense, net |
$165 |
|
to |
$169 |
|
|
$0.38 |
|
to |
$0.39 |
|
Non-cash portion of tax provision |
$0 |
|
to |
$8 |
|
|
$0.00 |
|
to |
$0.02 |
|
Non-real estate related depreciation, amortization and
accretion |
$47 |
|
to |
$62 |
|
|
$0.11 |
|
to |
$0.14 |
|
Amortization of non-cash interest expense |
$7 |
|
to |
$17 |
|
|
$0.02 |
|
to |
$0.04 |
|
Other (income) expense |
$2 |
|
to |
$7 |
|
|
$0.00 |
|
to |
$0.02 |
|
(Gains) losses on retirement of long-term obligations |
$0 |
|
to |
$0 |
|
|
$0.00 |
|
to |
$0.00 |
|
Acquisition and integration costs |
$0 |
|
to |
$8 |
|
|
$0.00 |
|
to |
$0.02 |
|
Sustaining capital expenditures |
$(88) |
|
to |
$(68) |
|
|
$(0.20) |
|
to |
$(0.16) |
|
AFFO(c)(d) |
$3,261 |
|
to |
$3,296 |
|
|
$7.50 |
|
to |
$7.58 |
|
Weighted-average common shares outstanding—diluted |
|
435 |
|
|
|
435 |
|
(a) As issued on July 19,
2023.(b) See the reconciliation of "Outlook for
Components of Interest Expense" for a discussion of non-cash
interest expense.(c) See discussion of and our
definition of Adjusted EBITDA, FFO and AFFO, including per share
amounts in this "Non-GAAP Measures and Other
Information."(d) The above reconciliation excludes
line items included in our definition which are not applicable for
the periods shown.
Components of Changes in Site Rental Revenues for the
Quarters Ended September 30, 2023 and 2022:
|
Three Months Ended September 30, |
(dollars in millions; totals
may not sum due to rounding) |
|
2023 |
|
|
|
2022 |
|
Components of changes in site
rental revenues: |
|
|
|
Prior year site rental billings(a) |
$ |
1,339 |
|
|
$ |
1,270 |
|
|
|
|
|
Core leasing activity(a) |
|
66 |
|
|
|
79 |
|
Escalators |
|
24 |
|
|
|
30 |
|
Non-renewals(a) |
|
(37 |
) |
|
|
(42 |
) |
Organic Contribution to Site Rental Billings as Adjusted for Impact
of Sprint Cancellations(a) |
|
53 |
|
|
|
67 |
|
Payments for Sprint Cancellations(a)(b) |
|
6 |
|
|
|
— |
|
Non-renewals associated with Sprint Cancellations(a)(b) |
|
(6 |
) |
|
|
— |
|
Organic Contribution to Site Rental Billings(a) |
|
53 |
|
|
|
67 |
|
Straight-lined revenues |
|
58 |
|
|
|
90 |
|
Amortization of prepaid rent |
|
126 |
|
|
|
140 |
|
Acquisitions(c) |
|
1 |
|
|
|
1 |
|
Other |
|
— |
|
|
|
— |
|
Total site rental
revenues |
$ |
1,577 |
|
|
$ |
1,568 |
|
|
|
|
|
Year-over-year changes in
revenues: |
|
|
|
Site rental revenues as a percentage of prior year site rental
revenues |
|
0.6 |
% |
|
|
8.1 |
% |
Changes in revenues as a percentage of prior year site rental
billings: |
|
|
|
Organic Contribution to Site Rental Billings as Adjusted for Impact
of Sprint Cancellations(a) |
|
4.0 |
% |
|
|
5.3 |
% |
Organic Contribution to Site Rental Billings(a) |
|
3.9 |
% |
|
|
5.3 |
% |
(a) See our definitions of site
rental billings, core leasing activity, non-renewals, Sprint
Cancellations, Organic Contribution to Site Rental Billings and
Organic Contribution to Site Rental Billings as Adjusted for Impact
of Sprint Cancellations in this "Non-GAAP Measures and Other
Information."(b) In the third quarter 2023, we
received $6 million of payments for Sprint Cancellations that
relate to fiber solutions, and $5 million and $2 million of
non-renewals associated with Sprint Cancellations that relate to
small cells and fiber solutions,
respectively.(c) Represents the contribution from
recent acquisitions. The financial impact of recent acquisitions is
excluded from Organic Contribution to Site Rental Billings,
including as Adjusted for Impact of Sprint Cancellations, until the
one-year anniversary of such acquisitions.
Components of Changes in Site Rental
Revenues for Full Year 2023 and 2024 Outlook:
(dollars in millions; totals
may not sum due to rounding) |
Full Year 2023 Outlook(a) |
|
Full Year 2024 Outlook(a) |
Components of changes in site
rental revenues: |
|
|
|
Prior year site rental billings excluding payments for Sprint
Cancellations(b) |
$5,310 |
|
|
$5,486 |
|
Prior year payments for Sprint Cancellations |
|
$ — |
|
|
$165 |
|
Prior year site rental billings(b) |
$5,310 |
|
|
$5,651 |
|
|
|
|
|
Core leasing activity(b) |
$275 |
|
to |
$305 |
|
|
$305 |
|
to |
$335 |
|
Escalators |
$90 |
|
to |
$100 |
|
|
$95 |
|
to |
$105 |
|
Non-renewals(b) |
$(175) |
|
to |
$(155) |
|
|
$(165) |
|
to |
$(145) |
|
Organic Contribution to Site Rental Billings as Adjusted for Impact
of Sprint Cancellations(b) |
$205 |
|
to |
$235 |
|
|
$245 |
|
to |
$285 |
|
Payments for Sprint Cancellations(b)(c) |
$160 |
|
to |
$170 |
|
|
$(170) |
|
to |
$(160) |
|
Non-renewals associated with Sprint Cancellations(b)(c) |
$(25) |
|
to |
$(25) |
|
|
$(10) |
|
to |
$(10) |
|
Organic Contribution to Site Rental Billings(b) |
$340 |
|
to |
$380 |
|
|
$70 |
|
to |
$110 |
|
Straight-lined revenues |
$264 |
|
to |
$284 |
|
|
$175 |
|
to |
$200 |
|
Amortization of prepaid rent |
$570 |
|
to |
$580 |
|
|
$410 |
|
to |
$435 |
|
Acquisitions(d) |
|
— |
|
|
|
— |
|
Other |
|
— |
|
|
|
— |
|
Total site rental
revenues |
$6,488 |
|
to |
$6,533 |
|
|
$6,347 |
|
to |
$6,392 |
|
|
|
|
|
Year-over-year changes in
revenues:(e) |
|
|
|
Site rental revenues as a percentage of prior year site rental
revenues |
|
3.5% |
|
|
|
(2.2)% |
|
Organic Contribution to Site Rental Billings as Adjusted for Impact
of Sprint Cancellations as a percentage of prior year site rental
billings excluding payments for Sprint Cancellations(b) |
|
4.1% |
|
|
|
4.8% |
|
Organic Contribution to Site Rental Billings as a percentage of
prior year site rental billings(b) |
|
6.8% |
|
|
|
1.6% |
|
(a) As issued on October 18,
2023.(b) See our definitions of site rental
billings, core leasing activity, non-renewals, Sprint
Cancellations, Organic Contribution to Site Rental Billings, and
Organic Contribution to Site Rental Billings as Adjusted for Impact
of Sprint Cancellations in this "Non-GAAP Measures and Other
Information."(c) Full year 2023 Outlook reflects
approximately $70 million and $100 million of payments for Sprint
Cancellations that related to fiber solutions and small cells,
respectively, and $10 million and $15 million of non-renewals
associated with Sprint Cancellations that related to fiber
solutions and small cells, respectively. These payments are
non-recurring and therefore reduce full year 2024 Organic
Contribution to Site Rental Billings by the same amount.
(d) Represents the contribution from recent
acquisitions. The financial impact of recent acquisitions is
excluded from Organic Contribution to Site Rental Billings,
including as Adjusted for Impact of Sprint Cancellations, until the
one-year anniversary of such
acquisitions.(e) Calculated based on midpoint of
respective full year Outlook, where applicable.
Components of Capital
Expenditures:(a)
|
For the Three Months Ended |
|
September 30, 2023 |
|
September 30, 2022 |
(in millions) |
Towers |
Fiber |
Other |
Total |
|
Towers |
Fiber |
Other |
Total |
Discretionary capital
expenditures: |
|
|
|
|
|
|
|
|
|
Communications infrastructure improvements and other capital
projects |
$ |
34 |
$ |
273 |
$ |
5 |
$ |
312 |
|
$ |
30 |
$ |
267 |
$ |
5 |
$ |
302 |
Purchases of land interests |
|
13 |
|
— |
|
— |
|
13 |
|
|
12 |
|
— |
|
— |
|
12 |
Sustaining capital
expenditures |
|
2 |
|
14 |
|
6 |
|
22 |
|
|
3 |
|
10 |
|
10 |
|
23 |
Total capital
expenditures |
$ |
49 |
$ |
287 |
$ |
11 |
$ |
347 |
|
$ |
45 |
$ |
277 |
$ |
15 |
$ |
337 |
|
|
|
|
|
|
|
|
|
|
|
For the Nine Months Ended |
|
September 30, 2023 |
|
September 30, 2022 |
(in millions) |
Towers |
Fiber |
Other |
Total |
|
Towers |
Fiber |
Other |
Total |
Discretionary capital
expenditures: |
|
|
|
|
|
|
|
|
|
Communications infrastructure improvements and other capital
projects |
$ |
101 |
$ |
843 |
$ |
17 |
$ |
961 |
|
$ |
92 |
$ |
711 |
$ |
16 |
$ |
819 |
Purchases of land interests |
|
51 |
|
— |
|
— |
|
51 |
|
|
37 |
|
— |
|
— |
|
37 |
Sustaining capital
expenditures |
|
8 |
|
29 |
|
18 |
|
55 |
|
|
8 |
|
35 |
|
22 |
|
65 |
Total capital
expenditures |
$ |
160 |
$ |
872 |
$ |
35 |
$ |
1,067 |
|
$ |
137 |
$ |
746 |
$ |
38 |
$ |
921 |
Outlook for Discretionary Capital
Expenditures Less Prepaid Rent
Additions(a)(d):
(in millions) |
Full Year 2023 Outlook(b) |
|
Full Year 2024 Outlook(b) |
Discretionary capital
expenditures |
$1,300 |
to |
$1,400 |
|
$1,530 |
to |
$1,630 |
Less: Prepaid rent
additions(c) |
~$400 |
|
~$430 |
Discretionary capital
expenditures less prepaid rent additions |
$900 |
to |
$1,000 |
|
$1,100 |
to |
$1,200 |
Components of Interest
Expense:
|
For the Three Months Ended |
(in millions) |
September 30, 2023 |
|
September 30, 2022 |
Interest expense on debt
obligations |
$ |
213 |
|
|
$ |
174 |
|
Amortization of deferred
financing costs and adjustments on long-term debt |
|
8 |
|
|
|
6 |
|
Capitalized interest |
|
(4 |
) |
|
|
(3 |
) |
Interest expense and
amortization of deferred financing costs, net |
$ |
217 |
|
|
$ |
177 |
|
Outlook for Components of Interest
Expense:
(in millions) |
Full Year 2023 Outlook(b) |
|
Full Year 2024 Outlook(b) |
Interest expense on debt
obligations |
$824 |
|
to |
$854 |
|
|
$922 |
|
to |
$962 |
|
Amortization of deferred
financing costs and adjustments on long-term debt |
$20 |
|
to |
$30 |
|
|
$20 |
|
to |
$30 |
|
Capitalized interest |
$(18) |
|
to |
$(8) |
|
|
$(17) |
|
to |
$(7) |
|
Interest expense and
amortization of deferred financing costs, net |
$834 |
|
to |
$869 |
|
|
$933 |
|
to |
$978 |
|
(a) See our definitions of discretionary
capital expenditures and sustaining capital expenditures in this
"Non-GAAP Measures and Other Information."(b) As
issued on October 18, 2023.(c) Reflects up-front
consideration from long-term tenant contracts (commonly referred to
as prepaid rent) that are amortized and recognized as revenue over
the associated estimated lease term in accordance with
GAAP.(d) Outlook reflects discretionary capital
expenditures, exclusive of sustaining capital expenditures. See
"Non-GAAP Measures and Other Information" for our definitions of
discretionary capital expenditures and sustaining capital
expenditures.
Debt Balances and Maturity Dates as of
September 30, 2023:
(in millions) |
Face Value(a) |
|
Final Maturity |
Cash, cash equivalents
and restricted cash |
$ |
289 |
|
|
|
|
|
|
Senior Secured Notes, Series
2009-1, Class A-2(b) |
|
41 |
|
Aug. 2029 |
Senior Secured Tower Revenue
Notes, Series 2015-2(c) |
|
700 |
|
May 2045 |
Senior Secured Tower Revenue
Notes, Series 2018-2(c) |
|
750 |
|
July 2048 |
Finance leases and other
obligations |
|
264 |
|
Various |
Total secured debt |
$ |
1,755 |
|
|
2016 Revolver(d) |
|
160 |
|
July 2027 |
2016 Term Loan A(e) |
|
1,169 |
|
July 2027 |
Commercial Paper Notes(f) |
|
1,803 |
|
Various |
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 |
2.900% Senior Notes |
|
750 |
|
Mar. 2027 |
4.000% Senior Notes |
|
500 |
|
Mar. 2027 |
3.650% Senior Notes |
|
1,000 |
|
Sept. 2027 |
5.000% Senior Notes |
|
1,000 |
|
Jan. 2028 |
3.800% Senior Notes |
|
1,000 |
|
Feb. 2028 |
4.800% Senior Notes |
|
600 |
|
Sept. 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 |
5.100% Senior Notes |
|
750 |
|
May. 2033 |
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 |
$ |
21,132 |
|
|
Net Debt(g) |
$ |
22,598 |
|
|
(a) Net of required principal
amortizations.(b) The Senior Secured Notes,
2009-1, Class A-2 principal amortizes over a period ending in
August 2029.(c) If the respective series of Tower
Revenue Notes are 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
and 2018-2 have anticipated repayment dates in 2025 and 2028,
respectively. Notes are prepayable at par if voluntarily repaid
within eighteen months of maturity; earlier prepayment may require
additional consideration.(d) As of
September 30, 2023, the undrawn availability under the $7.0
billion 2016 Revolver was $6.8 billion. The Company pays a
commitment fee on the undrawn available amount, which as of June
30, 2023 ranged from 0.080% to 0.300%, based on the Company's
senior unsecured debt rating, per annum.(e) The
2016 Term Loan A principal amortizes over a period ending in July
2027.(f) As of September 30, 2023, the
Company had $0.2 billion available for issuance under its $2.0
billion unsecured commercial paper program. The maturities of the
Commercial Paper Notes, when outstanding, may vary but may not
exceed 397 days from the date of issue.(g) See
further information on, and our definition and calculation of, Net
Debt in this "Non-GAAP Measures and Other Information."
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 2023 and 2024 Outlook and
plans, projections, expectations and estimates regarding (1) the
value of our business model and strategy, (2) our dividends,
including the timing, growth, and targets relating thereto, and its
driving factors, (3) cash flow growth and the factors driving such
growth, (4) revenue growth and its driving factors, (5) net income
(loss) (including on a per share basis), (6) AFFO (including on a
per share basis) and its components and growth, (7) Adjusted EBITDA
and its components and growth, (8) Organic Contribution to Site
Rental Billings (including as Adjusted for Impact of Sprint
Cancellations) and its components and growth, (9) site rental
revenues and its components and growth, (10) interest expense, (11)
our balance sheet, (12) the impact of Sprint Cancellations on our
operating and financial results, (13) our restructuring plan and
the cost reductions, charges, scope and savings associated
therewith, including timing, amounts, impact and recurrence, (14)
services contribution, (15) the growth in our business and its
driving factors, (16) our customers’ investments and plans and
demand for our assets and solutions created thereby, and its
driving factors, (17) small cell deployment, including growth in
small cell node construction, and the impacts therefrom, (18)
discretionary capital expenditures, including the sources of
funding related thereto, (19) debt leverage ratio, (20) the impact
of the exit from installation services, (21) operating trends
across our business and the impacts therefrom and (22) prepaid rent
additions and amortization. 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
(including towers, small cells and fiber), 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, reduce demand for our communications
infrastructure and services and impact our dividend per share
growth.
- 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.
- 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.
- 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.
- Cybersecurity breaches or other
information technology disruptions could adversely affect our
operations, business and reputation.
- Our business may be adversely
impacted by climate-related events, natural disasters, including
wildfires, and other unforeseen events.
- 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 wireless technologies may not
deploy or be adopted by tenants as rapidly or in the manner
projected.
- Our focus on and disclosure of our
Environmental, Social and Governance position, metrics, strategy,
goals and initiatives expose us to potential litigation and other
adverse effects to our business.
- We operate in a challenging labor
market and failure to attract, recruit and retain qualified and
experienced employees could adversely affect our business,
operations and costs.
- 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, possibly on
unfavorable terms, 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.
- Certain provisions of our restated
certificate of incorporation, as amended, 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.
- 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.
- 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 Real Estate Investment Trust ("REIT") involves highly technical
and complex provisions of the Code. Failure to remain qualified as
a REIT would result in our inability to deduct dividends to
stockholders when computing our taxable income, thereby increasing
our tax obligations and reducing 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.
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 INC.CONDENSED CONSOLIDATED
BALANCE SHEET (UNAUDITED)(Amounts in millions, except par
values) |
|
September 30,2023 |
|
December 31, 2022 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
117 |
|
|
$ |
156 |
|
Restricted cash |
|
167 |
|
|
|
166 |
|
Receivables, net |
|
512 |
|
|
|
593 |
|
Prepaid expenses |
|
143 |
|
|
|
102 |
|
Deferred site rental receivables |
|
115 |
|
|
|
127 |
|
Other current assets |
|
72 |
|
|
|
73 |
|
Total current assets |
|
1,126 |
|
|
|
1,217 |
|
Deferred site rental
receivables |
|
2,189 |
|
|
|
1,954 |
|
Property and equipment,
net |
|
15,573 |
|
|
|
15,407 |
|
Operating lease right-of-use
assets |
|
6,309 |
|
|
|
6,526 |
|
Goodwill |
|
10,085 |
|
|
|
10,085 |
|
Other intangible assets,
net |
|
3,276 |
|
|
|
3,596 |
|
Other assets, net |
|
141 |
|
|
|
136 |
|
Total assets |
$ |
38,699 |
|
|
$ |
38,921 |
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
215 |
|
|
$ |
236 |
|
Accrued interest |
|
145 |
|
|
|
183 |
|
Deferred revenues |
|
650 |
|
|
|
736 |
|
Other accrued liabilities |
|
373 |
|
|
|
407 |
|
Current maturities of debt and other obligations |
|
827 |
|
|
|
819 |
|
Current portion of operating lease liabilities |
|
339 |
|
|
|
350 |
|
Total current liabilities |
|
2,549 |
|
|
|
2,731 |
|
Debt and other long-term
obligations |
|
21,903 |
|
|
|
20,910 |
|
Operating lease
liabilities |
|
5,660 |
|
|
|
5,881 |
|
Other long-term
liabilities |
|
1,918 |
|
|
|
1,950 |
|
Total liabilities |
|
32,030 |
|
|
|
31,472 |
|
Commitments and
contingencies |
|
|
|
Stockholders' equity: |
|
|
|
Common stock, 0.01 par value; 1,200 shares authorized; shares
issued and outstanding: September 30, 2023—434 and December
31, 2022—433 |
|
4 |
|
|
|
4 |
|
Additional paid-in capital |
|
18,241 |
|
|
|
18,116 |
|
Accumulated other comprehensive income (loss) |
|
(5 |
) |
|
|
(5 |
) |
Dividends/distributions in excess of earnings |
|
(11,571 |
) |
|
|
(10,666 |
) |
Total equity |
|
6,669 |
|
|
|
7,449 |
|
Total liabilities and equity |
$ |
38,699 |
|
|
$ |
38,921 |
|
|
CROWN CASTLE INC.CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS (UNAUDITED)(Amounts in millions,
except per share amounts) |
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Net revenues: |
|
|
|
|
|
|
|
Site rental |
$ |
1,577 |
|
|
$ |
1,568 |
|
|
$ |
4,929 |
|
|
$ |
4,711 |
|
Services and other |
|
90 |
|
|
|
178 |
|
|
|
378 |
|
|
|
511 |
|
Net revenues |
|
1,667 |
|
|
|
1,746 |
|
|
|
5,307 |
|
|
|
5,222 |
|
Operating expenses: |
|
|
|
|
|
|
|
Costs of operations:(a) |
|
|
|
|
|
|
|
Site rental |
|
420 |
|
|
|
405 |
|
|
|
1,259 |
|
|
|
1,204 |
|
Services and other |
|
66 |
|
|
|
119 |
|
|
|
268 |
|
|
|
344 |
|
Selling, general and administrative |
|
176 |
|
|
|
187 |
|
|
|
581 |
|
|
|
558 |
|
Asset write-down charges |
|
8 |
|
|
|
3 |
|
|
|
30 |
|
|
|
26 |
|
Acquisition and integration costs |
|
— |
|
|
|
— |
|
|
|
1 |
|
|
|
1 |
|
Depreciation, amortization and accretion |
|
439 |
|
|
|
430 |
|
|
|
1,315 |
|
|
|
1,276 |
|
Restructuring charges |
|
72 |
|
|
|
— |
|
|
|
72 |
|
|
|
— |
|
Total operating expenses |
|
1,181 |
|
|
|
1,144 |
|
|
|
3,526 |
|
|
|
3,409 |
|
Operating income (loss) |
|
486 |
|
|
|
602 |
|
|
|
1,781 |
|
|
|
1,813 |
|
Interest expense and
amortization of deferred financing costs, net |
|
(217 |
) |
|
|
(177 |
) |
|
|
(627 |
) |
|
|
(506 |
) |
Gains (losses) on retirement
of long-term obligations |
|
— |
|
|
|
(2 |
) |
|
|
— |
|
|
|
(28 |
) |
Interest income |
|
3 |
|
|
|
1 |
|
|
|
10 |
|
|
|
1 |
|
Other income (expense) |
|
— |
|
|
|
(2 |
) |
|
|
(4 |
) |
|
|
(5 |
) |
Income (loss) before income
taxes |
|
272 |
|
|
|
422 |
|
|
|
1,160 |
|
|
|
1,275 |
|
Benefit (provision) for income
taxes |
|
(7 |
) |
|
|
(3 |
) |
|
|
(21 |
) |
|
|
(14 |
) |
Net income (loss) |
$ |
265 |
|
|
$ |
419 |
|
|
$ |
1,139 |
|
|
$ |
1,261 |
|
|
|
|
|
|
|
|
|
Net income (loss), per common
share: |
|
|
|
|
|
|
|
Basic |
$ |
0.61 |
|
|
$ |
0.97 |
|
|
$ |
2.63 |
|
|
$ |
2.91 |
|
Diluted |
$ |
0.61 |
|
|
$ |
0.97 |
|
|
$ |
2.63 |
|
|
$ |
2.91 |
|
Weighted-average common shares
outstanding: |
|
|
|
|
|
|
|
Basic |
|
434 |
|
|
|
433 |
|
|
|
434 |
|
|
|
433 |
|
Diluted |
|
434 |
|
|
|
434 |
|
|
|
434 |
|
|
|
434 |
|
(a) Exclusive of depreciation, amortization and
accretion shown separately.
|
CROWN CASTLE INC.CONDENSED CONSOLIDATED
STATEMENT OF CASH FLOWS (UNAUDITED)(In millions of
dollars) |
|
Nine Months Ended September 30, |
|
|
2023 |
|
|
|
2022 |
|
Cash flows from operating
activities: |
|
|
|
Net income (loss) |
$ |
1,139 |
|
|
$ |
1,261 |
|
Adjustments to reconcile net
income (loss) to net cash provided by (used for) operating
activities: |
|
|
|
Depreciation, amortization and accretion |
|
1,315 |
|
|
|
1,276 |
|
(Gains) losses on retirement of long-term obligations |
|
— |
|
|
|
28 |
|
Amortization of deferred financing costs and other non-cash
interest |
|
22 |
|
|
|
10 |
|
Stock-based compensation expense, net |
|
126 |
|
|
|
120 |
|
Asset write-down charges |
|
30 |
|
|
|
26 |
|
Deferred income tax (benefit) provision |
|
1 |
|
|
|
2 |
|
Other non-cash adjustments, net |
|
10 |
|
|
|
6 |
|
Changes in assets and liabilities, excluding the effects of
acquisitions: |
|
|
|
Increase (decrease) in liabilities |
|
(220 |
) |
|
|
(329 |
) |
Decrease (increase) in assets |
|
(165 |
) |
|
|
(362 |
) |
Net cash provided by (used for) operating activities |
|
2,258 |
|
|
|
2,038 |
|
Cash flows from investing
activities: |
|
|
|
Capital expenditures |
|
(1,067 |
) |
|
|
(921 |
) |
Payments for acquisitions, net of cash acquired |
|
(93 |
) |
|
|
(15 |
) |
Other investing activities, net |
|
5 |
|
|
|
(10 |
) |
Net cash provided by (used for) investing activities |
|
(1,155 |
) |
|
|
(946 |
) |
Cash flows from financing
activities: |
|
|
|
Proceeds from issuance of long-term debt |
|
2,347 |
|
|
|
748 |
|
Principal payments on debt and other long-term obligations |
|
(58 |
) |
|
|
(55 |
) |
Purchases and redemptions of long-term debt |
|
(750 |
) |
|
|
(1,274 |
) |
Borrowings under revolving credit facility |
|
2,943 |
|
|
|
2,625 |
|
Payments under revolving credit facility |
|
(4,088 |
) |
|
|
(2,580 |
) |
Net borrowings (repayments) under commercial paper program |
|
561 |
|
|
|
1,329 |
|
Payments for financing costs |
|
(23 |
) |
|
|
(14 |
) |
Purchases of common stock |
|
(29 |
) |
|
|
(64 |
) |
Dividends/distributions paid on common stock |
|
(2,044 |
) |
|
|
(1,924 |
) |
Net cash provided by (used for) financing activities |
|
(1,141 |
) |
|
|
(1,209 |
) |
Net increase (decrease) in
cash, cash equivalents and restricted cash |
|
(38 |
) |
|
|
(117 |
) |
Effect of exchange rate
changes on cash |
|
— |
|
|
|
(2 |
) |
Cash, cash equivalents and restricted cash at beginning of
period |
|
327 |
|
|
|
466 |
|
Cash, cash equivalents and
restricted cash at end of period |
$ |
289 |
|
|
$ |
347 |
|
Supplemental disclosure of
cash flow information: |
|
|
|
Interest paid |
|
654 |
|
|
|
559 |
|
Income taxes paid (refunded) |
|
13 |
|
|
|
10 |
|
|
CROWN CASTLE INC.SEGMENT OPERATING RESULTS
(UNAUDITED)(In millions of dollars) |
SEGMENT OPERATING RESULTS |
|
Three Months Ended
September 30, 2023 |
|
Three Months Ended
September 30, 2022 |
|
Towers |
|
Fiber |
|
Other |
|
Consolidated Total |
|
Towers |
|
Fiber |
|
Other |
|
Consolidated Total |
Segment site rental revenues |
$ |
1,074 |
|
$ |
503 |
|
|
|
$ |
1,577 |
|
$ |
1,084 |
|
$ |
484 |
|
|
|
$ |
1,568 |
Segment services and other
revenues |
|
86 |
|
|
4 |
|
|
|
|
90 |
|
|
175 |
|
|
3 |
|
|
|
|
178 |
Segment revenues |
|
1,160 |
|
|
507 |
|
|
|
|
1,667 |
|
|
1,259 |
|
|
487 |
|
|
|
|
1,746 |
Segment site rental costs of
operations |
|
236 |
|
|
175 |
|
|
|
|
411 |
|
|
230 |
|
|
166 |
|
|
|
|
396 |
Segment services and other
costs of operations |
|
61 |
|
|
3 |
|
|
|
|
64 |
|
|
114 |
|
|
3 |
|
|
|
|
117 |
Segment costs of
operations(a)(b) |
|
297 |
|
|
178 |
|
|
|
|
475 |
|
|
344 |
|
|
169 |
|
|
|
|
513 |
Segment site rental gross
margin(c) |
|
838 |
|
|
328 |
|
|
|
|
1,166 |
|
|
854 |
|
|
318 |
|
|
|
|
1,172 |
Segment services and other
gross margin(c) |
|
25 |
|
|
1 |
|
|
|
|
26 |
|
|
61 |
|
|
— |
|
|
|
|
61 |
Segment selling, general and
administrative expenses(b) |
|
24 |
|
|
48 |
|
|
|
|
72 |
|
|
28 |
|
|
47 |
|
|
|
|
75 |
Segment operating
profit(c) |
|
839 |
|
|
281 |
|
|
|
|
1,120 |
|
|
887 |
|
|
271 |
|
|
|
|
1,158 |
Other selling, general and
administrative expenses(b) |
|
|
|
|
$ |
75 |
|
|
75 |
|
|
|
|
|
$ |
81 |
|
|
81 |
Stock-based compensation
expense, net |
|
|
|
|
|
36 |
|
|
36 |
|
|
|
|
|
|
38 |
|
|
38 |
Depreciation, amortization and
accretion |
|
|
|
|
|
439 |
|
|
439 |
|
|
|
|
|
|
430 |
|
|
430 |
Restructuring charges |
|
|
|
|
|
72 |
|
|
72 |
|
|
|
|
|
|
— |
|
|
— |
Interest expense and
amortization of deferred financing costs, net |
|
|
|
|
|
217 |
|
|
217 |
|
|
|
|
|
|
177 |
|
|
177 |
Other (income) expenses to
reconcile to income (loss) before income taxes(d) |
|
|
|
|
|
9 |
|
|
9 |
|
|
|
|
|
|
10 |
|
|
10 |
Income (loss) before income
taxes |
|
|
|
|
|
|
$ |
272 |
|
|
|
|
|
|
|
$ |
422 |
(a) Exclusive of depreciation,
amortization and accretion shown
separately.(b) Segment costs of operations exclude
(1) stock-based compensation expense, net of $7 million for each of
the three months ended September 30, 2023 and 2022 and (2)
prepaid lease purchase price adjustments of $4 million for each of
the three months ended September 30, 2023 and 2022. Segment
selling, general and administrative expenses and other selling,
general and administrative expenses exclude stock-based
compensation expense, net of $29 million and $31 million for
the three months ended September 30, 2023 and 2022,
respectively.(c) See "Non-GAAP Measures and Other
Information" for a discussion and 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, 2023 |
|
Nine Months Ended
September 30, 2022 |
|
Towers |
|
Fiber |
|
Other |
|
Consolidated Total |
|
Towers |
|
Fiber |
|
Other |
|
Consolidated Total |
Segment site rental revenues |
$ |
3,234 |
|
$ |
1,695 |
|
|
|
$ |
4,929 |
|
$ |
3,237 |
|
$ |
1,474 |
|
|
|
$ |
4,711 |
Segment services and other
revenues |
|
356 |
|
|
22 |
|
|
|
|
378 |
|
|
502 |
|
|
9 |
|
|
|
|
511 |
Segment revenues |
|
3,590 |
|
|
1,717 |
|
|
|
|
5,307 |
|
|
3,739 |
|
|
1,483 |
|
|
|
|
5,222 |
Segment site rental costs of
operations |
|
714 |
|
|
518 |
|
|
|
|
1,232 |
|
|
689 |
|
|
490 |
|
|
|
|
1,179 |
Segment services and other
costs of operations |
|
252 |
|
|
8 |
|
|
|
|
260 |
|
|
329 |
|
|
7 |
|
|
|
|
336 |
Segment costs of
operations(a)(b) |
|
966 |
|
|
526 |
|
|
|
|
1,492 |
|
|
1,018 |
|
|
497 |
|
|
|
|
1,515 |
Segment site rental gross
margin(c) |
|
2,520 |
|
|
1,177 |
|
|
|
|
3,697 |
|
|
2,548 |
|
|
984 |
|
|
|
|
3,532 |
Segment services and other
gross margin(c) |
|
104 |
|
|
14 |
|
|
|
|
118 |
|
|
173 |
|
|
2 |
|
|
|
|
175 |
Segment selling, general and
administrative expenses(b) |
|
84 |
|
|
148 |
|
|
|
|
232 |
|
|
84 |
|
|
140 |
|
|
|
|
224 |
Segment operating
profit(c) |
|
2,540 |
|
|
1,043 |
|
|
|
|
3,583 |
|
|
2,637 |
|
|
846 |
|
|
|
|
3,483 |
Other selling, general and
administrative expenses(b) |
|
|
|
|
$ |
246 |
|
|
246 |
|
|
|
|
|
$ |
234 |
|
|
234 |
Stock-based compensation
expense, net |
|
|
|
|
|
126 |
|
|
126 |
|
|
|
|
|
|
121 |
|
|
121 |
Depreciation, amortization and
accretion |
|
|
|
|
|
1,315 |
|
|
1,315 |
|
|
|
|
|
|
1,276 |
|
|
1,276 |
Restructuring charges |
|
|
|
|
|
72 |
|
|
72 |
|
|
|
|
|
|
— |
|
|
— |
Interest expense and
amortization of deferred financing costs, net |
|
|
|
|
|
627 |
|
|
627 |
|
|
|
|
|
|
506 |
|
|
506 |
Other (income) expenses to
reconcile to income (loss) before income taxes(d) |
|
|
|
|
|
37 |
|
|
37 |
|
|
|
|
|
|
71 |
|
|
71 |
Income (loss) before income
taxes |
|
|
|
|
|
|
$ |
1,160 |
|
|
|
|
|
|
|
$ |
1,275 |
(a) Exclusive of depreciation,
amortization and accretion shown
separately.(b) Segment costs of operations exclude
(1) stock-based compensation expense, net of $23 million and
$21 million for the nine months ended September 30, 2023
and 2022, respectively, and (2) prepaid lease purchase price
adjustments of $12 million for each of the nine months ended
September 30, 2023 and 2022, respectively. Segment selling,
general and administrative expenses and other selling, general and
administrative expenses exclude stock-based compensation expense,
net of $103 million and $100 million for the nine months
ended September 30, 2023 and 2022,
respectively.(c) See "Non-GAAP Measures and Other
Information" for a discussion and 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.
Contacts: |
Dan Schlanger, CFO |
|
Kris Hinson, VP Corp Finance
& Treasurer |
|
Crown Castle Inc. |
|
713-570-3050 |
Charts accompanying this announcement are available
at
https://www.globenewswire.com/NewsRoom/AttachmentNg/d9e50ea1-2832-4876-a892-ba73f95be3ef
https://www.globenewswire.com/NewsRoom/AttachmentNg/6e1d68e9-c14e-4710-90db-614dc513ddd1
Crown Castle (NYSE:CCI)
Gráfico Histórico do Ativo
De Abr 2024 até Mai 2024
Crown Castle (NYSE:CCI)
Gráfico Histórico do Ativo
De Mai 2023 até Mai 2024