10-QPeriod: Q3 FY2015

CROWN CASTLE INC. Quarterly Report for Q3 Ended Sep 30, 2015

Filed November 6, 2015For Securities:CCI

Summary

Crown Castle International Corp. (CCI) reported its third quarter 2015 financial results, showing solid performance driven by its U.S. wireless infrastructure business. The company's strategic focus on U.S. operations, following the divestiture of its Australian subsidiary (CCAL), positions it for continued growth. Key financial highlights include increased site rental revenues, reflecting strong demand from major wireless carriers for network upgrades and expansion. CCI continues to emphasize returning capital to shareholders through dividends, having increased its quarterly dividend. The company also made significant strategic moves, including the acquisition of Sunesys, a fiber services provider, to enhance its small cell network capabilities. This acquisition, along with continued investments in wireless infrastructure, underscores CCI's commitment to long-term stockholder value creation and dividend growth.

Financial Highlights

49 data points
Beta

Revenue

$918.11M

Net Income

$103.78M

11.3% Net Margin

EPS (Diluted)

$0.28

Total Assets

$22.00B

Cash & Equivalents

$184.12M

Free Cash Flow

$372.00M

Financial Statements
Beta
Revenue$918.11M
SG&A Expenses$76.70M
Operating Expenses$687.30M
Operating Income$230.80M
Interest Expense$121.29M
Net Income$103.78M
EPS (Basic)$0.28
EPS (Diluted)$0.28
Shares Outstanding (Basic)333.05M
Shares Outstanding (Diluted)333.71M

Key Highlights

  • 1Site rental revenues increased by 7% year-over-year for the third quarter, reaching $764.6 million, driven by new tenant additions and escalations.
  • 2The company completed the sale of its Australian subsidiary (CCAL) for approximately $1.1 billion in net proceeds, allowing for a strategic focus on U.S. operations.
  • 3Crown Castle acquired Sunesys for approximately $1.0 billion to expand its fiber network and small cell infrastructure.
  • 4Net income attributable to common stockholders was $92.8 million for the third quarter of 2015, a slight decrease from $95.9 million in the prior year.
  • 5The company increased its quarterly common stock dividend to $0.885 per share, representing an 8% increase.
  • 6Net cash provided by operating activities from continuing operations increased by 12% to $1.3 billion for the first nine months of 2015.
  • 7Total assets grew to $21.99 billion as of September 30, 2015, compared to $21.14 billion at December 31, 2014, largely due to acquisitions and property additions.

Frequently Asked Questions

The sale of CCAL, the Australian subsidiary, was completed in May 2015, generating approximately $1.1 billion in net proceeds. This transaction is treated as discontinued operations for all periods presented and resulted in a significant gain on disposal of $981.0 million recorded in the first nine months of 2015. The proceeds were used to repay debt and the divestiture allowed the company to focus exclusively on its U.S. operations.

Crown Castle acquired Sunesys for approximately $1.0 billion in August 2015. Sunesys is a fiber services provider with a significant fiber network in major U.S. metropolitan markets. This acquisition is expected to enhance Crown Castle's capabilities in small cell networks, complementing its existing tower infrastructure and supporting the increasing demand for wireless data services.

Crown Castle's strategy includes returning a meaningful portion of its cash provided by operating activities to shareholders in the form of dividends. In October 2015, the company announced an increase in its quarterly common stock dividend to $0.885 per share, an 8% increase, and expects to pay approximately $1.2 billion in dividends over the next 12 months. The company aims to grow its dividend per share generally commensurate with its realized growth in organic cash flows.

As of September 30, 2015, Crown Castle had approximately $12.1 billion in total debt. The company actively manages its exposure to interest rate risk by maintaining a mix of fixed and floating-rate debt. Approximately 68% of its debt was fixed-rate at the time of this filing. The company has no scheduled debt maturities in the next 12 months other than principal payments on amortizing debt.