|
x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
76-0470458
|
(State or other jurisdiction
of incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
|
|
1220 Augusta Drive, Suite 600, Houston, Texas 77057-2261
(Address of principal executives office) (Zip Code)
|
|
(713) 570-3000
(Registrant's telephone number, including area code)
|
|
Large accelerated filer
|
x
|
|
Accelerated filer
|
o
|
|
|
Non-accelerated filer
|
o
|
|
Smaller reporting company
|
o
|
|
|
|
|
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Page
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|
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ITEM 1.
|
|
||
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|
||
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|
||
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|
||
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||
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|
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ITEM 2.
|
|
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ITEM 3.
|
|
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ITEM 4.
|
|
||
|
|||
ITEM 1.
|
LEGAL PROCEEDINGS
|
|
|
ITEM 1A.
|
|
||
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
|
|
ITEM 6.
|
|
||
|
|||
EXHIBIT INDEX
|
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
(Unaudited)
|
|
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
202,338
|
|
|
$
|
178,810
|
|
Restricted cash
|
132,119
|
|
|
130,731
|
|
||
Receivables, net
|
229,015
|
|
|
313,296
|
|
||
Prepaid expenses
|
138,029
|
|
|
133,194
|
|
||
Other current assets
|
116,114
|
|
|
225,214
|
|
||
Total current assets
|
817,615
|
|
|
981,245
|
|
||
Deferred site rental receivables
|
1,333,790
|
|
|
1,306,408
|
|
||
Property and equipment, net of accumulated depreciation of $6,202,803 and $5,798,875, respectively
|
9,670,358
|
|
|
9,580,057
|
|
||
Goodwill
|
5,744,681
|
|
|
5,513,551
|
|
||
Other intangible assets, net
|
3,779,957
|
|
|
3,779,915
|
|
||
Long-term prepaid rent and other assets, net
|
806,673
|
|
|
775,790
|
|
||
Total assets
|
$
|
22,153,074
|
|
|
$
|
21,936,966
|
|
|
|
|
|
||||
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
143,082
|
|
|
$
|
159,629
|
|
Accrued interest
|
96,939
|
|
|
66,975
|
|
||
Deferred revenues
|
364,010
|
|
|
322,623
|
|
||
Other accrued liabilities
|
171,588
|
|
|
199,923
|
|
||
Current maturities of debt and other obligations
|
100,345
|
|
|
106,219
|
|
||
Total current liabilities
|
875,964
|
|
|
855,369
|
|
||
Debt and other long-term obligations
|
12,325,859
|
|
|
12,043,740
|
|
||
Other long-term liabilities
|
2,002,944
|
|
|
1,948,636
|
|
||
Total liabilities
|
15,204,767
|
|
|
14,847,745
|
|
||
Commitments and contingencies (note 9)
|
|
|
|
||||
CCIC stockholders' equity:
|
|
|
|
||||
Common stock, $.01 par value; 600,000,000 shares authorized; shares issued and outstanding: June 30, 2016—337,562,378 and December 31, 2015—333,771,660
|
3,375
|
|
|
3,338
|
|
||
4.50% Mandatory Convertible Preferred Stock, Series A, $.01 par value; 20,000,000 shares authorized; shares issued and outstanding: June 30, 2016 and December 31, 2015—9,775,000; aggregate liquidation value: June 30, 2016 and December 31, 2015—$977,500
|
98
|
|
|
98
|
|
||
Additional paid-in capital
|
9,894,921
|
|
|
9,548,580
|
|
||
Accumulated other comprehensive income (loss)
|
(4,006
|
)
|
|
(4,398
|
)
|
||
Dividends/distributions in excess of earnings
|
(2,946,081
|
)
|
|
(2,458,397
|
)
|
||
Total equity
|
6,948,307
|
|
|
7,089,221
|
|
||
Total liabilities and equity
|
$
|
22,153,074
|
|
|
$
|
21,936,966
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net revenues:
|
|
|
|
|
|
|
|
||||||||
Site rental
|
$
|
804,600
|
|
|
$
|
737,091
|
|
|
$
|
1,603,893
|
|
|
$
|
1,468,471
|
|
Network services and other
|
157,809
|
|
|
162,346
|
|
|
292,899
|
|
|
331,437
|
|
||||
Net revenues
|
962,409
|
|
|
899,437
|
|
|
1,896,792
|
|
|
1,799,908
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Costs of operations
(a)
:
|
|
|
|
|
|
|
|
||||||||
Site rental
|
252,852
|
|
|
237,031
|
|
|
505,472
|
|
|
469,244
|
|
||||
Network services and other
|
95,867
|
|
|
89,400
|
|
|
176,838
|
|
|
176,318
|
|
||||
General and administrative
|
91,386
|
|
|
73,125
|
|
|
188,967
|
|
|
147,181
|
|
||||
Asset write-down charges
|
11,952
|
|
|
3,620
|
|
|
19,912
|
|
|
12,175
|
|
||||
Acquisition and integration costs
|
3,141
|
|
|
2,377
|
|
|
8,779
|
|
|
4,393
|
|
||||
Depreciation, amortization and accretion
|
276,026
|
|
|
253,153
|
|
|
553,901
|
|
|
504,959
|
|
||||
Total operating expenses
|
731,224
|
|
|
658,706
|
|
|
1,453,869
|
|
|
1,314,270
|
|
||||
Operating income (loss)
|
231,185
|
|
|
240,731
|
|
|
442,923
|
|
|
485,638
|
|
||||
Interest expense and amortization of deferred financing costs
|
(129,362
|
)
|
|
(134,466
|
)
|
|
(255,740
|
)
|
|
(268,905
|
)
|
||||
Gains (losses) on retirement of long-term obligations
|
(11,468
|
)
|
|
(4,181
|
)
|
|
(42,017
|
)
|
|
(4,157
|
)
|
||||
Interest income
|
105
|
|
|
325
|
|
|
279
|
|
|
381
|
|
||||
Other income (expense)
|
(518
|
)
|
|
59,973
|
|
|
(3,791
|
)
|
|
59,724
|
|
||||
Income (loss) from continuing operations before income taxes
|
89,942
|
|
|
162,382
|
|
|
141,654
|
|
|
272,681
|
|
||||
Benefit (provision) for income taxes
|
(3,884
|
)
|
|
4,144
|
|
|
(7,756
|
)
|
|
5,579
|
|
||||
Income (loss) from continuing operations
|
86,058
|
|
|
166,526
|
|
|
133,898
|
|
|
278,260
|
|
||||
Discontinued operations (see note 3):
|
|
|
|
|
|
|
|
||||||||
Income (loss) from discontinued operations, net of tax
|
—
|
|
|
6,312
|
|
|
—
|
|
|
19,690
|
|
||||
Net gain (loss) from disposal of discontinued operations, net of tax
|
—
|
|
|
981,540
|
|
|
—
|
|
|
981,540
|
|
||||
Income (loss) from discontinued operations, net of tax
|
—
|
|
|
987,852
|
|
|
—
|
|
|
1,001,230
|
|
||||
Net income (loss)
|
86,058
|
|
|
1,154,378
|
|
|
133,898
|
|
|
1,279,490
|
|
||||
Less: Net income (loss) attributable to the noncontrolling interest
|
—
|
|
|
1,018
|
|
|
—
|
|
|
3,343
|
|
||||
Net income (loss) attributable to CCIC stockholders
|
86,058
|
|
|
1,153,360
|
|
|
133,898
|
|
|
1,276,147
|
|
||||
Dividends on preferred stock
|
(10,997
|
)
|
|
(10,997
|
)
|
|
(21,994
|
)
|
|
(21,994
|
)
|
||||
Net income (loss) attributable to CCIC common stockholders
|
$
|
75,061
|
|
|
$
|
1,142,363
|
|
|
$
|
111,904
|
|
|
$
|
1,254,153
|
|
Net income (loss)
|
$
|
86,058
|
|
|
$
|
1,154,378
|
|
|
$
|
133,898
|
|
|
$
|
1,279,490
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps reclassified into "interest expense and amortization of deferred financing costs", net of taxes
|
—
|
|
|
7,490
|
|
|
—
|
|
|
14,981
|
|
||||
Foreign currency translation adjustments
|
971
|
|
|
3,401
|
|
|
392
|
|
|
(12,861
|
)
|
||||
Amounts reclassified into discontinued operations for foreign currency translation adjustments (see note 3)
|
—
|
|
|
(25,678
|
)
|
|
—
|
|
|
(25,678
|
)
|
||||
Total other comprehensive income (loss)
|
971
|
|
|
(14,787
|
)
|
|
392
|
|
|
(23,558
|
)
|
||||
Comprehensive income (loss)
|
87,029
|
|
|
1,139,591
|
|
|
134,290
|
|
|
1,255,932
|
|
||||
Less: Comprehensive income (loss) attributable to the noncontrolling interest
|
—
|
|
|
1,401
|
|
|
—
|
|
|
2,471
|
|
||||
Comprehensive income (loss) attributable to CCIC stockholders
|
$
|
87,029
|
|
|
$
|
1,138,190
|
|
|
$
|
134,290
|
|
|
$
|
1,253,461
|
|
Net income (loss) attributable to CCIC common stockholders, per common share:
|
|
|
|
|
|
|
|
||||||||
Income (loss) from continuing operations, basic
|
$
|
0.22
|
|
|
$
|
0.47
|
|
|
$
|
0.33
|
|
|
$
|
0.77
|
|
Income (loss) from discontinued operations, basic
|
$
|
—
|
|
|
$
|
2.96
|
|
|
$
|
—
|
|
|
$
|
3.00
|
|
Net income (loss) attributable to CCIC common stockholders, basic
|
$
|
0.22
|
|
|
$
|
3.43
|
|
|
$
|
0.33
|
|
|
$
|
3.77
|
|
Income (loss) from continuing operations, diluted
|
$
|
0.22
|
|
|
$
|
0.47
|
|
|
$
|
0.33
|
|
|
$
|
0.77
|
|
Income (loss) from discontinued operations, diluted
|
$
|
—
|
|
|
$
|
2.95
|
|
|
$
|
—
|
|
|
$
|
2.99
|
|
Net income (loss) attributable to CCIC common stockholders, diluted
|
$
|
0.22
|
|
|
$
|
3.42
|
|
|
$
|
0.33
|
|
|
$
|
3.76
|
|
Weighted-average common shares outstanding (in thousands):
|
|
|
|
|
|
|
|
||||||||
Basic
|
337,560
|
|
333,091
|
|
|
335,857
|
|
332,902
|
|||||||
Diluted
|
338,609
|
|
333,733
|
|
|
336,658
|
|
333,665
|
(a)
|
Exclusive of depreciation, amortization and accretion shown separately.
|
|
Six Months Ended June 30,
|
|
||||||
|
2016
|
|
2015
|
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net income (loss) from continuing operations
|
$
|
133,898
|
|
|
$
|
278,260
|
|
|
Adjustments to reconcile net income (loss) from continuing operations to net cash provided by (used for) operating activities:
|
|
|
|
|
||||
Depreciation, amortization and accretion
|
553,901
|
|
|
504,959
|
|
|
||
Gains (losses) on retirement of long-term obligations
|
42,017
|
|
|
4,157
|
|
|
||
Gains (losses) on settled swaps
|
2,608
|
|
|
(54,475
|
)
|
|
||
Amortization of deferred financing costs and other non-cash interest
|
7,993
|
|
|
23,804
|
|
|
||
Stock-based compensation expense
|
40,135
|
|
|
30,131
|
|
|
||
Asset write-down charges
|
19,912
|
|
|
12,175
|
|
|
||
Deferred income tax benefit (provision)
|
3,947
|
|
|
(10,170
|
)
|
|
||
Other adjustments, net
|
(936
|
)
|
|
(6,328
|
)
|
|
||
Changes in assets and liabilities, excluding the effects of acquisitions:
|
|
|
|
|
||||
Increase (decrease) in accrued interest
|
29,964
|
|
|
124
|
|
|
||
Increase (decrease) in accounts payable
|
(6,715
|
)
|
|
1,493
|
|
|
||
Increase (decrease) in deferred revenues, deferred ground lease payables, other accrued liabilities and other liabilities
|
60,896
|
|
|
130,044
|
|
|
||
Decrease (increase) in receivables
|
84,776
|
|
|
60,231
|
|
|
||
Decrease (increase) in prepaid expenses, deferred site rental receivables, long-term prepaid rent, restricted cash and other assets
|
(54,215
|
)
|
|
(55,527
|
)
|
|
||
Net cash provided by (used for) operating activities
|
918,181
|
|
|
918,878
|
|
|
||
Cash flows from investing activities:
|
|
|
|
|
||||
Payments for acquisitions of businesses, net of cash acquired
|
(493,932
|
)
|
|
(64,725
|
)
|
|
||
Capital expenditures
|
(392,997
|
)
|
|
(420,883
|
)
|
|
||
Net receipts from settled swaps
|
8,141
|
|
|
54,475
|
|
|
||
Other investing activities, net
|
1,854
|
|
|
(8,080
|
)
|
|
||
Net cash provided by (used for) investing activities
|
(876,934
|
)
|
|
(439,213
|
)
|
|
||
Cash flows from financing activities:
|
|
|
|
|
||||
Proceeds from issuance of long-term debt
|
4,501,206
|
|
|
1,000,000
|
|
|
||
Principal payments on debt and other long-term obligations
|
(43,838
|
)
|
|
(53,718
|
)
|
|
||
Purchases and redemptions of long-term debt
|
(3,536,362
|
)
|
|
(1,069,337
|
)
|
|
||
Borrowings under revolving credit facility
|
3,030,000
|
|
|
450,000
|
|
|
||
Payments under revolving credit facility
|
(3,720,000
|
)
|
|
(1,145,000
|
)
|
|
||
Payments for financing costs
|
(35,604
|
)
|
|
(16,348
|
)
|
|
||
Net proceeds from issuance of capital stock
|
323,798
|
|
|
—
|
|
|
||
Purchases of capital stock
|
(24,460
|
)
|
|
(29,490
|
)
|
|
||
Dividends/distributions paid on common stock
|
(597,846
|
)
|
|
(547,371
|
)
|
|
||
Dividends paid on preferred stock
|
(21,994
|
)
|
|
(21,994
|
)
|
|
||
Net (increase) decrease in restricted cash
|
(6,089
|
)
|
|
9,093
|
|
|
||
Net cash provided by (used for) financing activities
|
(131,189
|
)
|
|
(1,424,165
|
)
|
|
||
Net increase (decrease) in cash and cash equivalents - continuing operations
|
(89,942
|
)
|
|
(944,500
|
)
|
|
||
Discontinued operations (see note 3):
|
|
|
|
|
||||
Net cash provided by (used for) operating activities
|
—
|
|
|
4,881
|
|
|
||
Net cash provided by (used for) investing activities
|
113,150
|
|
|
1,103,577
|
|
|
||
Net increase (decrease) in cash and cash equivalents - discontinued operations
|
113,150
|
|
|
1,108,458
|
|
|
||
Effect of exchange rate changes
|
320
|
|
|
(969
|
)
|
|
||
Cash and cash equivalents at beginning of period
|
178,810
|
|
|
175,620
|
|
(a)
|
||
Cash and cash equivalents at end of period
|
$
|
202,338
|
|
|
$
|
338,609
|
|
|
(a)
|
Inclusive of cash and cash equivalents included in discontinued operations.
|
|
CCIC Stockholders
|
|
|
|
|
||||||||||||||||||||||||||||||||
|
Common Stock
|
|
4.50% Mandatory Convertible Preferred Stock
|
|
|
|
AOCI
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
Shares
|
|
($.01 Par)
|
|
Shares
|
|
($.01 Par)
|
|
Additional
paid-in
capital
|
|
Foreign Currency Translation Adjustments
|
|
Derivative Instruments, net of tax
|
|
Dividends/Distributions in Excess of Earnings
|
|
Noncontrolling
Interest from discontinued operations
|
|
Total
|
||||||||||||||||||
Balance, April 1, 2016
|
337,559,718
|
|
|
$
|
3,375
|
|
|
9,775,000
|
|
|
$
|
98
|
|
|
$
|
9,874,862
|
|
|
$
|
(4,977
|
)
|
|
$
|
—
|
|
|
$
|
(2,720,364
|
)
|
|
$
|
—
|
|
|
$
|
7,152,994
|
|
Stock-based compensation related activity, net of forfeitures
|
3,826
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,165
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,165
|
|
||||||||
Purchases and retirement of capital stock
|
(1,166
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(106
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(106
|
)
|
||||||||
Other comprehensive income (loss)
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
971
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
971
|
|
||||||||
Common stock dividends/distributions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(300,778
|
)
|
|
—
|
|
|
(300,778
|
)
|
||||||||
Preferred stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,997
|
)
|
|
—
|
|
|
(10,997
|
)
|
||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
86,058
|
|
|
—
|
|
|
86,058
|
|
||||||||
Balance, June 30, 2016
|
337,562,378
|
|
|
$
|
3,375
|
|
|
9,775,000
|
|
|
$
|
98
|
|
|
$
|
9,894,921
|
|
|
$
|
(4,006
|
)
|
|
$
|
—
|
|
|
$
|
(2,946,081
|
)
|
|
$
|
—
|
|
|
$
|
6,948,307
|
|
(a)
|
See the condensed statement of operations and other comprehensive income (loss) for the components of "other comprehensive income (loss)."
|
|
CCIC Stockholders
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Common Stock
|
|
4.50% Mandatory Convertible Preferred Stock
|
|
|
|
AOCI
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
Shares
|
|
($.01 Par)
|
|
Shares
|
|
($.01 Par)
|
|
Additional
paid-in capital |
|
Foreign Currency Translation Adjustments
|
|
Derivative Instruments, net of tax
|
|
Dividends/Distributions in Excess of Earnings
|
|
Noncontrolling
Interest from discontinued operations
|
|
Total
|
||||||||||||||||||
Balance, April 1, 2015
|
333,761,959
|
|
|
$
|
3,339
|
|
|
9,775,000
|
|
|
$
|
98
|
|
|
$
|
9,503,335
|
|
|
$
|
19,538
|
|
|
$
|
(11,234
|
)
|
|
$
|
(2,978,356
|
)
|
|
$
|
22,073
|
|
|
$
|
6,558,793
|
|
Stock-based compensation related activity, net of forfeitures
|
1,829
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,887
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,887
|
|
||||||||
Purchases and retirement of capital stock
|
(1,444
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(119
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(119
|
)
|
||||||||
Other comprehensive income (loss)
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(22,660
|
)
|
|
7,490
|
|
|
—
|
|
|
383
|
|
|
(14,787
|
)
|
||||||||
Disposition of CCAL
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,474
|
)
|
|
(23,474
|
)
|
||||||||
Common stock dividends/distributions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(274,445
|
)
|
|
—
|
|
|
(274,445
|
)
|
||||||||
Preferred stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,997
|
)
|
|
—
|
|
|
(10,997
|
)
|
||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,153,360
|
|
|
1,018
|
|
|
1,154,378
|
|
||||||||
Balance, June 30, 2015
|
333,762,344
|
|
|
$
|
3,339
|
|
|
9,775,000
|
|
|
$
|
98
|
|
|
$
|
9,518,103
|
|
|
$
|
(3,122
|
)
|
|
$
|
(3,744
|
)
|
|
$
|
(2,110,438
|
)
|
|
$
|
—
|
|
|
$
|
7,404,236
|
|
(a)
|
See the condensed statement of operations and other comprehensive income (loss) for the components of "other comprehensive income (loss)" and note
5
with respect to the reclassification adjustments.
|
|
CCIC Stockholders
|
|
|
|
|
||||||||||||||||||||||||||||||||
|
Common Stock
|
|
4.50% Mandatory Convertible Preferred Stock
|
|
|
|
AOCI
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
Shares
|
|
($.01 Par)
|
|
Shares
|
|
($.01 Par)
|
|
Additional
paid-in capital |
|
Foreign Currency Translation Adjustments
|
|
Derivative Instruments, net of tax
|
|
Dividends/Distributions in Excess of Earnings
|
|
Noncontrolling
Interest from discontinued operations
|
|
Total
|
||||||||||||||||||
Balance, January 1, 2016
|
333,771,660
|
|
|
$
|
3,338
|
|
|
9,775,000
|
|
|
$
|
98
|
|
|
$
|
9,548,580
|
|
|
$
|
(4,398
|
)
|
|
$
|
—
|
|
|
$
|
(2,458,397
|
)
|
|
$
|
—
|
|
|
$
|
7,089,221
|
|
Stock-based compensation related activity, net of forfeitures
|
246,936
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
47,038
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
47,040
|
|
||||||||
Purchases and retirement of capital stock
|
(284,282
|
)
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(24,457
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24,460
|
)
|
||||||||
Net proceeds from issuance of Common Stock
|
3,828,064
|
|
|
38
|
|
|
—
|
|
|
—
|
|
|
323,760
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
323,798
|
|
||||||||
Other comprehensive income (loss)
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
392
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
392
|
|
||||||||
Common stock dividends/distributions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(599,588
|
)
|
|
—
|
|
|
(599,588
|
)
|
||||||||
Preferred stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,994
|
)
|
|
—
|
|
|
(21,994
|
)
|
||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
133,898
|
|
|
—
|
|
|
133,898
|
|
||||||||
Balance, June 30, 2016
|
337,562,378
|
|
|
$
|
3,375
|
|
|
9,775,000
|
|
|
$
|
98
|
|
|
$
|
9,894,921
|
|
|
$
|
(4,006
|
)
|
|
$
|
—
|
|
|
$
|
(2,946,081
|
)
|
|
$
|
—
|
|
|
$
|
6,948,307
|
|
(a)
|
See the condensed statement of operations and other comprehensive income (loss) for the components of "other comprehensive income (loss)."
|
|
CCIC Stockholders
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Common Stock
|
|
4.50% Mandatory Convertible Preferred Stock
|
|
|
|
AOCI
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
Shares
|
|
($.01 Par)
|
|
Shares
|
|
($.01 Par)
|
|
Additional
paid-in capital |
|
Foreign Currency Translation Adjustments
|
|
Derivative Instruments, net of tax
|
|
Dividends/Distributions in Excess of Earnings
|
|
Noncontrolling
Interest from discontinued operations
|
|
Total
|
||||||||||||||||||
Balance, January 1, 2015
|
333,856,632
|
|
|
$
|
3,339
|
|
|
9,775,000
|
|
|
$
|
98
|
|
|
$
|
9,512,396
|
|
|
$
|
34,545
|
|
|
$
|
(18,725
|
)
|
|
$
|
(2,815,428
|
)
|
|
$
|
21,003
|
|
|
$
|
6,737,228
|
|
Stock-based compensation related activity, net of forfeitures
|
240,245
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
35,195
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35,197
|
|
||||||||
Purchases and retirement of capital stock
|
(334,533
|
)
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(29,488
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(29,490
|
)
|
||||||||
Other comprehensive income (loss)
(a)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(37,667
|
)
|
|
14,981
|
|
|
—
|
|
|
(872
|
)
|
|
(23,558
|
)
|
||||||||
Disposition of CCAL
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,474
|
)
|
|
(23,474
|
)
|
||||||||
Common stock dividends/distributions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(549,163
|
)
|
|
—
|
|
|
(549,163
|
)
|
||||||||
Preferred stock dividends
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,994
|
)
|
|
—
|
|
|
(21,994
|
)
|
||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,276,147
|
|
|
3,343
|
|
|
1,279,490
|
|
||||||||
Balance, June 30, 2015
|
333,762,344
|
|
|
$
|
3,339
|
|
|
9,775,000
|
|
|
$
|
98
|
|
|
$
|
9,518,103
|
|
|
$
|
(3,122
|
)
|
|
$
|
(3,744
|
)
|
|
$
|
(2,110,438
|
)
|
|
$
|
—
|
|
|
$
|
7,404,236
|
|
(a)
|
See the condensed statement of operations and other comprehensive income (loss) for the components of "other comprehensive income (loss)" and note
5
with respect to the reclassification adjustments.
|
1.
|
General
|
2.
|
Summary of Significant Accounting Policies
|
3.
|
Discontinued Operations
|
|
Three Months Ended June 30, 2015
(b)(c)
|
|
Six Months Ended June 30, 2015
(b)(c)
|
||||
Total revenues
|
$
|
24,763
|
|
|
$
|
65,293
|
|
Total cost of operations
(a)
|
6,771
|
|
|
17,498
|
|
||
Depreciation, amortization, and accretion
|
3,914
|
|
|
10,168
|
|
||
Total other expenses
|
5,026
|
|
|
10,481
|
|
||
Pre-tax income from discontinued operations
|
9,052
|
|
|
27,146
|
|
||
Income (loss) from discontinued operations, net of tax
(d)
|
$
|
6,312
|
|
|
$
|
19,690
|
|
(a)
|
Exclusive of depreciation, amortization, and accretion shown separately.
|
(b)
|
No interest expense has been allocated to discontinued operations.
|
(c)
|
CCAL results are through May 28, 2015, which was the closing date of the Company's sale of CCAL.
|
(d)
|
Exclusive of the gain (loss) from disposal of discontinued operations, net of tax, as presented on the condensed consolidated financial statement of operations.
|
4.
|
Acquisitions
|
5.
|
Debt and Other Obligations
|
|
Original
Issue Date
|
|
Contractual
Maturity
Date (a)
|
|
Balance as of
June 30, 2016
(f)
|
|
Balance as of
December 31, 2015
(f)
|
|
Stated Interest
Rate as of
June 30, 2016
(a)
|
|||||
Bank debt - variable rate:
|
|
|
|
|
|
|
|
|
|
|||||
2016 Revolver
|
Jan. 2016
|
|
Jan. 2021
|
|
$
|
435,000
|
|
(b)
|
$
|
—
|
|
|
1.8
|
%
|
2016 Term Loan A
|
Jan. 2016
|
|
Jan. 2021
|
|
1,978,041
|
|
(b)
|
—
|
|
|
1.9
|
%
|
||
2012 Revolver
|
Jan. 2012
|
|
Jan. 2019
|
|
—
|
|
(b)
|
1,125,000
|
|
|
N/A
|
|
||
Tranche A Term Loans
|
Jan. 2012
|
|
Jan. 2019
|
|
—
|
|
(b)
|
627,846
|
|
|
N/A
|
|
||
Tranche B Term Loans
|
Jan. 2012
|
|
Jan. 2021
|
|
—
|
|
(b)
|
2,219,602
|
|
|
N/A
|
|
||
Total bank debt
|
|
|
|
|
2,413,041
|
|
|
3,972,448
|
|
|
|
|||
Securitized debt - fixed rate:
|
|
|
|
|
|
|
|
|
|
|||||
Secured Notes, Series 2009-1
|
July 2009
|
|
Aug. 2019
|
|
60,824
|
|
|
70,219
|
|
|
6.3
|
%
|
||
Secured Notes, Series 2009-2
|
July 2009
|
|
Aug. 2029
|
|
68,698
|
|
|
68,658
|
|
|
9.0
|
%
|
||
Tower Revenue Notes, Series 2010-2
|
Jan. 2010
|
|
Jan. 2037
|
(e)
|
—
|
|
|
349,171
|
|
|
N/A
|
|
||
Tower Revenue Notes, Series 2010-3
|
Jan. 2010
|
|
Jan. 2040
|
(c)
|
1,243,302
|
|
|
1,242,368
|
|
|
6.1
|
%
|
||
Tower Revenue Notes, Series 2010-5
|
Aug. 2010
|
|
Aug. 2037
|
(e)
|
—
|
|
|
298,774
|
|
|
N/A
|
|
||
Tower Revenue Notes, Series 2010-6
|
Aug. 2010
|
|
Aug. 2040
|
(c)
|
992,648
|
|
|
991,749
|
|
|
4.9
|
%
|
||
Tower Revenue Notes, Series 2015-1
|
May 2015
|
|
May 2042
|
(c)
|
296,254
|
|
|
295,937
|
|
|
3.2
|
%
|
||
Tower Revenue Notes, Series 2015-2
|
May 2015
|
|
May 2045
|
(c)
|
690,764
|
|
|
690,247
|
|
|
3.7
|
%
|
||
Total securitized debt
|
|
|
|
|
3,352,490
|
|
|
4,007,123
|
|
|
|
|||
Bonds - fixed rate:
|
|
|
|
|
|
|
|
|
|
|||||
5.250% Senior Notes
|
Oct. 2012
|
|
Jan. 2023
|
|
1,636,044
|
|
|
1,634,989
|
|
|
5.3
|
%
|
||
2.381% Secured Notes
|
Dec. 2012
|
|
Dec. 2017
|
|
497,882
|
|
|
497,160
|
|
|
2.4
|
%
|
||
3.849% Secured Notes
|
Dec. 2012
|
|
Apr. 2023
|
|
990,587
|
|
|
989,895
|
|
|
3.9
|
%
|
||
4.875% Senior Notes
|
Apr. 2014
|
|
Apr. 2022
|
|
839,448
|
|
|
838,579
|
|
|
4.9
|
%
|
||
3.400% Senior Notes
|
Feb./May 2016
|
|
Feb. 2021
|
|
849,574
|
|
(d)(e)
|
—
|
|
|
3.4
|
%
|
||
4.450% Senior Notes
|
Feb. 2016
|
|
Feb. 2026
|
|
889,631
|
|
(d)
|
—
|
|
|
4.5
|
%
|
||
3.700% Senior Notes
|
May 2016
|
|
June 2026
|
|
741,314
|
|
(e)
|
—
|
|
|
3.7
|
%
|
||
Total bonds
|
|
|
|
|
6,444,480
|
|
|
3,960,623
|
|
|
|
|||
Other:
|
|
|
|
|
|
|
|
|
|
|||||
Capital leases and other obligations
|
Various
|
|
Various
|
|
216,193
|
|
|
209,765
|
|
|
Various
|
|
||
Total debt and other obligations
|
|
|
|
|
12,426,204
|
|
|
12,149,959
|
|
|
|
|||
Less: current maturities and short-term debt and other current obligations
|
|
|
|
|
100,345
|
|
|
106,219
|
|
|
|
|||
Non-current portion of long-term debt and other long-term obligations
|
|
|
|
|
$
|
12,325,859
|
|
|
$
|
12,043,740
|
|
|
|
(a)
|
See the
2015
Form 10-K, including note 8, for additional information regarding the maturity and principal amortization provisions and interest rates relating to the Company's indebtedness.
|
(b)
|
In January 2016, the Company completed a Senior Unsecured Credit Facility ("2016 Credit Facility"), comprised of (1) a
$2.5 billion
Senior Unsecured Revolving Credit Facility ("2016 Revolver") maturing in January 2021, (2) a
$2.0 billion
Senior Unsecured Term Loan A Facility ("2016 Term Loan A") maturing in January 2021 and (3) a previously outstanding
$1.0 billion
Senior Unsecured 364-Day Revolving Credit Facility ("364-Day Facility") maturing in January 2017. The 2016 Credit Facility bears interest at a per annum rate equal to LIBOR plus
1.125%
to
2.000%
, based on the Company's senior unsecured debt rating. The Company used the net proceeds from the 2016 Credit Facility (1) to repay the previously outstanding 2012 Credit Facility and (2) for general corporate purposes. In February 2016, the Company used a portion of the net proceeds from the 2016 Senior Notes offering to repay in full all outstanding borrowings under the previously outstanding 364-Day Facility. As of
June 30, 2016
, the undrawn availability under the 2016 Revolver was $
2.1 billion
.
|
(c)
|
If the respective series of such debt is not paid in full on or prior to an applicable date then 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. See the
2015
Form 10-K for additional information regarding these provisions.
|
(d)
|
In February 2016, the Company issued
$1.5 billion
aggregate principal amount of senior unsecured notes ("2016 Senior Notes"), which consist of (1)
$600.0 million
aggregated principal amount of
3.40%
senior notes with a final maturity date of February 2021 and (2)
$900.0 million
aggregate principal amount of
4.45%
senior notes with a final maturity date of February 2026. The Company used net proceeds from the 2016 Senior Notes offering, together with cash on hand, to (1) repay in full all outstanding borrowings under the previously outstanding 364-Day Facility and (2) repay
$500.0 million
of outstanding borrowings under the 2016 Revolver.
|
(e)
|
In May 2016, the Company issued
$1.0 billion
aggregate principal amount of senior unsecured notes ("May 2016 Senior Notes"), which consist of (1)
$250.0 million
aggregate principal amount of
3.40%
senior notes that were issued pursuant to the same indenture as the 3.40% senior notes of the 2016 Senior Notes with a final maturity date of February 2021 and (2)
$750.0 million
aggregate principal amount of
3.70%
senior notes with a final maturity date of June 2026. The Company used net proceeds from the May 2016 Senior Notes offering to repay in full the Tower Revenue Notes, Series 2010-2 and Series 2010-5, each issued by certain of its subsidiaries, and to repay a portion of the outstanding borrowings under the 2016 Revolver.
|
(f)
|
Balances reflect debt issuance costs as a direct reduction from the respective carrying amounts of debt, with the exception of debt issuance costs associated with the Company's revolving credit facilities. See note 2.
|
|
Six Months Ending
December 31,
|
|
Years Ending December 31,
|
|
|
|
|
|
Unamortized Adjustments, Net
|
|
Total Debt and Other Obligations Outstanding
|
||||||||||||||||||||||||
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
|
Total Cash Obligations
|
|
|
||||||||||||||||||||
Scheduled contractual maturities
|
$
|
49,938
|
|
|
$
|
599,019
|
|
|
$
|
133,080
|
|
|
$
|
137,058
|
|
|
$
|
200,788
|
|
|
$
|
11,400,756
|
|
|
$
|
12,520,639
|
|
|
$
|
(94,435
|
)
|
|
$
|
12,426,204
|
|
|
Six Months Ended June 30, 2016
|
||||||||||
|
Principal Amount
|
|
Cash Paid
(a)
|
|
Gains (Losses)
(b)
|
||||||
2012 Revolver
(c)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(1,930
|
)
|
Tranche A Term Loans
|
629,375
|
|
|
629,375
|
|
|
(1,498
|
)
|
|||
Tranche B Term Loans
|
2,247,015
|
|
|
2,247,015
|
|
|
(27,122
|
)
|
|||
Tower Revenue Notes, Series 2010-2
|
350,000
|
|
|
352,796
|
|
|
(3,338
|
)
|
|||
Tower Revenue Notes, Series 2010-5
|
300,000
|
|
|
307,176
|
|
|
(8,129
|
)
|
|||
Total
|
$
|
3,526,390
|
|
|
$
|
3,536,362
|
|
|
$
|
(42,017
|
)
|
(a)
|
Exclusive of accrued interest.
|
(b)
|
Inclusive of $
32.0 million
related to the write off of deferred financing costs.
|
(c)
|
See discussion of the repayment of the Company's 2012 Credit Facility above.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Interest expense on debt obligations
|
$
|
125,580
|
|
|
$
|
122,398
|
|
|
$
|
247,747
|
|
|
$
|
245,101
|
|
Amortization of deferred financing costs and adjustments on long-term debt
|
4,815
|
|
|
5,173
|
|
|
9,921
|
|
|
9,911
|
|
||||
Amortization of interest rate swaps
(a)
|
—
|
|
|
7,490
|
|
|
—
|
|
|
14,981
|
|
||||
Other, net of capitalized interest
|
(1,033
|
)
|
|
(595
|
)
|
|
(1,928
|
)
|
|
(1,088
|
)
|
||||
Total
|
$
|
129,362
|
|
|
$
|
134,466
|
|
|
$
|
255,740
|
|
|
$
|
268,905
|
|
(a)
|
Amounts reclassified from "accumulated other comprehensive income (loss)."
|
6.
|
Fair Value Disclosures
|
|
Level in Fair Value Hierarchy
|
|
June 30, 2016
|
|
December 31, 2015
|
||||||||||||
|
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
|||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
1
|
|
$
|
202,338
|
|
|
$
|
202,338
|
|
|
$
|
178,810
|
|
|
$
|
178,810
|
|
Restricted cash, current and non-current
|
1
|
|
137,119
|
|
|
137,119
|
|
|
135,731
|
|
|
135,731
|
|
||||
Foreign currency swaps
|
2
|
|
—
|
|
|
—
|
|
|
10,749
|
|
|
10,749
|
|
||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||
Long-term debt and other obligations
|
2
|
|
12,426,204
|
|
|
13,261,419
|
|
|
12,149,959
|
|
|
12,555,143
|
|
7.
|
Income Taxes
|
8.
|
Per Share Information
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net income (loss) from continuing operations
|
$
|
86,058
|
|
|
$
|
166,526
|
|
|
$
|
133,898
|
|
|
$
|
278,260
|
|
Dividends on preferred stock
|
(10,997
|
)
|
|
(10,997
|
)
|
|
(21,994
|
)
|
|
(21,994
|
)
|
||||
Net income (loss) from continuing operations attributable to CCIC common stockholders for basic and diluted computations
|
$
|
75,061
|
|
|
$
|
155,529
|
|
|
$
|
111,904
|
|
|
$
|
256,266
|
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from discontinued operations, net of tax
|
—
|
|
|
987,852
|
|
|
—
|
|
|
1,001,230
|
|
||||
Less: Net income (loss) attributable to the noncontrolling interest
|
—
|
|
|
1,018
|
|
|
—
|
|
|
3,343
|
|
||||
Net income (loss) from discontinued operations attributable to CCIC common stockholders for basic and diluted computations
|
$
|
—
|
|
|
$
|
986,834
|
|
|
$
|
—
|
|
|
$
|
997,887
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted-average number of common shares outstanding (in thousands):
|
|
|
|
|
|
|
|
||||||||
Basic weighted-average number of common stock outstanding
|
337,560
|
|
|
333,091
|
|
|
335,857
|
|
|
332,902
|
|
||||
Effect of assumed dilution from potential common shares relating to restricted stock units and restricted stock awards
|
1,049
|
|
|
642
|
|
|
801
|
|
|
763
|
|
||||
Diluted weighted-average number of common shares outstanding
|
338,609
|
|
|
333,733
|
|
|
336,658
|
|
|
333,665
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss) attributable to CCIC common stockholders, per common share:
|
|
|
|
|
|
|
|
||||||||
Income (loss) from continuing operations, basic
|
0.22
|
|
|
0.47
|
|
|
0.33
|
|
|
0.77
|
|
||||
Income (loss) from discontinued operations, basic
|
—
|
|
|
2.96
|
|
|
—
|
|
|
3.00
|
|
||||
Net income (loss) attributable to CCIC common stockholders, basic
|
0.22
|
|
|
3.43
|
|
|
0.33
|
|
|
3.77
|
|
||||
Income (loss) from continuing operations, diluted
|
0.22
|
|
|
0.47
|
|
|
0.33
|
|
|
0.77
|
|
||||
Income (loss) from discontinued operations, diluted
|
—
|
|
|
2.95
|
|
|
—
|
|
|
2.99
|
|
||||
Net income (loss) attributable to CCIC common stockholders, diluted
|
0.22
|
|
|
3.42
|
|
|
0.33
|
|
|
3.76
|
|
9.
|
Commitments and Contingencies
|
10.
|
Equity
|
Equity Type
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Dividends Per Share
|
|
Aggregate
Payment
Amount
(In millions)
|
|
||||
Common Stock
|
|
February 18, 2016
|
|
March 18, 2016
|
|
March 31, 2016
|
|
$
|
0.885
|
|
|
$
|
300.0
|
|
(a)
|
Common Stock
|
|
May 20, 2016
|
|
June 17, 2016
|
|
June 30, 2016
|
|
$
|
0.885
|
|
|
$
|
300.8
|
|
(a)
|
Convertible Preferred Stock
|
|
December 16, 2015
|
|
January 16, 2016
|
|
February 1, 2016
|
|
$
|
1.1250
|
|
|
$
|
11.0
|
|
|
Convertible Preferred Stock
|
|
March 22, 2016
|
|
April 15, 2016
|
|
May 2, 2016
|
|
$
|
1.1250
|
|
|
$
|
11.0
|
|
|
Convertible Preferred Stock
|
|
June 28, 2016
|
|
July 15, 2016
|
|
August 1, 2016
|
|
$
|
1.1250
|
|
|
$
|
11.0
|
|
(b)
|
(a)
|
Inclusive of dividends accrued for holders of unvested restricted stock units and payments of previously accrued dividends for holders of restricted stock units that have vested during the six months ended June 30, 2016.
|
(b)
|
Represents amount paid on August 1, 2016 based on holders of record on July 15, 2016.
|
11.
|
Operating Segments
|
|
Three Months Ended June 30, 2016
|
|
Three Months Ended June 30, 2015
|
||||||||||||||||||||||||||||
|
Towers
|
|
Small Cells
|
|
Other
|
|
Consolidated
Total
|
|
Towers
|
|
Small Cells
|
|
Other
|
|
Consolidated
Total
|
||||||||||||||||
Segment site rental revenues
|
$
|
705,716
|
|
|
$
|
98,884
|
|
|
|
|
$
|
804,600
|
|
|
$
|
678,306
|
|
|
$
|
58,785
|
|
|
|
|
$
|
737,091
|
|
||||
Segment network services and other revenues
|
142,053
|
|
|
15,756
|
|
|
|
|
157,809
|
|
|
150,732
|
|
|
11,614
|
|
|
|
|
162,346
|
|
||||||||||
Segment revenues
|
847,769
|
|
|
114,640
|
|
|
|
|
962,409
|
|
|
829,038
|
|
|
70,399
|
|
|
|
|
899,437
|
|
||||||||||
Segment site rental cost of operations
|
210,444
|
|
|
34,165
|
|
|
|
|
244,609
|
|
|
207,037
|
|
|
22,856
|
|
|
|
|
229,893
|
|
||||||||||
Segment network services and other cost of operations
|
81,922
|
|
|
12,423
|
|
|
|
|
94,345
|
|
|
77,671
|
|
|
10,367
|
|
|
|
|
88,038
|
|
||||||||||
Segment cost of operations
(a)
|
292,366
|
|
|
46,588
|
|
|
|
|
338,954
|
|
|
284,708
|
|
|
33,223
|
|
|
|
|
317,931
|
|
||||||||||
Segment site rental gross margin
|
495,272
|
|
|
64,719
|
|
|
|
|
559,991
|
|
|
471,269
|
|
|
35,929
|
|
|
|
|
507,198
|
|
||||||||||
Segment network services and other gross margin
|
60,131
|
|
|
3,333
|
|
|
|
|
63,464
|
|
|
73,061
|
|
|
1,247
|
|
|
|
|
74,308
|
|
||||||||||
Segment general and administrative expenses
(a)
|
22,505
|
|
|
15,718
|
|
|
35,563
|
|
|
73,786
|
|
|
22,529
|
|
|
7,910
|
|
|
30,141
|
|
|
60,580
|
|
||||||||
Segment operating profit
|
532,898
|
|
|
52,334
|
|
|
(35,563
|
)
|
|
549,669
|
|
|
521,801
|
|
|
29,266
|
|
|
(30,141
|
)
|
|
520,926
|
|
||||||||
Stock-based compensation expense
|
|
|
|
|
$
|
21,998
|
|
|
21,998
|
|
|
|
|
|
|
$
|
15,975
|
|
|
15,975
|
|
||||||||||
Depreciation, amortization and accretion
|
|
|
|
|
276,026
|
|
|
276,026
|
|
|
|
|
|
|
253,153
|
|
|
253,153
|
|
||||||||||||
Interest expense and amortization of deferred financing costs
|
|
|
|
|
129,362
|
|
|
129,362
|
|
|
|
|
|
|
134,466
|
|
|
134,466
|
|
||||||||||||
Other income (expenses) to reconcile to income (loss) from continuing operations before income taxes
|
|
|
|
|
32,341
|
|
|
32,341
|
|
|
|
|
|
|
(45,050
|
)
|
|
(45,050
|
)
|
||||||||||||
Income (loss) from continuing operations before income taxes
|
|
|
|
|
|
|
$
|
89,942
|
|
|
|
|
|
|
|
|
$
|
162,382
|
|
||||||||||||
Capital expenditures
|
$
|
104,180
|
|
|
$
|
87,450
|
|
|
$
|
7,878
|
|
|
$
|
199,508
|
|
|
$
|
157,938
|
|
|
$
|
55,289
|
|
|
$
|
6,003
|
|
|
$
|
219,230
|
|
Total assets (at period end)
|
$
|
18,479,117
|
|
|
$
|
3,199,577
|
|
|
$
|
474,380
|
|
|
$
|
22,153,074
|
|
|
$
|
17,982,322
|
|
|
$
|
2,302,664
|
|
|
$
|
618,586
|
|
|
$
|
20,903,572
|
|
(a)
|
Segment cost of operations exclude (1) stock-based compensation expense of
$4.4 million
and
$3.4 million
for the
three
months ended
June 30, 2016 and 2015
, respectively, and (2) prepaid lease purchase price adjustments of
$5.4 million
and
$5.1 million
for the
three
months ended March 31, 2016 and 2015, respectively. Segment general and administrative expenses exclude stock-based compensation expense of
$17.6 million
and
$12.5 million
for the
three
months ended
June 30, 2016 and 2015
, respectively.
|
|
Six Months Ended June 30, 2016
|
|
Six Months Ended June 30, 2015
|
||||||||||||||||||||||||||||
|
Towers
|
|
Small Cells
|
|
Other
|
|
Consolidated
Total
|
|
Towers
|
|
Small Cells
|
|
Other
|
|
Consolidated
Total
|
||||||||||||||||
Segment site rental revenues
|
$
|
1,408,555
|
|
|
$
|
195,338
|
|
|
|
|
$
|
1,603,893
|
|
|
$
|
1,353,213
|
|
|
$
|
115,258
|
|
|
|
|
$
|
1,468,471
|
|
||||
Segment network services and other revenues
|
267,063
|
|
|
25,836
|
|
|
|
|
292,899
|
|
|
307,117
|
|
|
24,320
|
|
|
|
|
331,437
|
|
||||||||||
Segment revenues
|
1,675,618
|
|
|
221,174
|
|
|
|
|
1,896,792
|
|
|
1,660,330
|
|
|
139,578
|
|
|
|
|
1,799,908
|
|
||||||||||
Segment site rental cost of operations
|
415,009
|
|
|
71,648
|
|
|
|
|
486,657
|
|
|
411,670
|
|
|
43,369
|
|
|
|
|
455,039
|
|
||||||||||
Segment network services and other cost of operations
|
151,911
|
|
|
20,458
|
|
|
|
|
172,369
|
|
|
153,862
|
|
|
19,821
|
|
|
|
|
173,683
|
|
||||||||||
Segment cost of operations
(a)
|
566,920
|
|
|
92,106
|
|
|
|
|
659,026
|
|
|
565,532
|
|
|
63,190
|
|
|
|
|
628,722
|
|
||||||||||
Segment site rental gross margin
|
993,546
|
|
|
123,690
|
|
|
|
|
1,117,236
|
|
|
941,543
|
|
|
71,889
|
|
|
|
|
1,013,432
|
|
||||||||||
Segment network services and other gross margin
|
115,152
|
|
|
5,378
|
|
|
|
|
120,530
|
|
|
153,255
|
|
|
4,499
|
|
|
|
|
157,754
|
|
||||||||||
Segment general and administrative expenses
(a)
|
46,104
|
|
|
31,240
|
|
|
71,635
|
|
|
148,979
|
|
|
45,251
|
|
|
15,470
|
|
|
60,240
|
|
|
120,961
|
|
||||||||
Segment operating profit
|
1,062,594
|
|
|
97,828
|
|
|
(71,635
|
)
|
|
1,088,787
|
|
|
1,049,547
|
|
|
60,918
|
|
|
(60,240
|
)
|
|
1,050,225
|
|
||||||||
Stock-based compensation expense
|
|
|
|
|
$
|
52,703
|
|
|
52,703
|
|
|
|
|
|
|
$
|
32,816
|
|
|
32,816
|
|
||||||||||
Depreciation, amortization and accretion
|
|
|
|
|
553,901
|
|
|
553,901
|
|
|
|
|
|
|
504,959
|
|
|
504,959
|
|
||||||||||||
Interest expense and amortization of deferred financing costs
|
|
|
|
|
255,740
|
|
|
255,740
|
|
|
|
|
|
|
268,905
|
|
|
268,905
|
|
||||||||||||
Other income (expenses) to reconcile to income (loss) from continuing operations before income taxes
|
|
|
|
|
84,789
|
|
|
84,789
|
|
|
|
|
|
|
(29,136
|
)
|
|
(29,136
|
)
|
||||||||||||
Income (loss) from continuing operations before income taxes
|
|
|
|
|
|
|
$
|
141,654
|
|
|
|
|
|
|
|
|
$
|
272,681
|
|
||||||||||||
Capital expenditures
|
$
|
215,221
|
|
|
$
|
167,603
|
|
|
$
|
10,173
|
|
|
$
|
392,997
|
|
|
$
|
291,071
|
|
|
$
|
118,192
|
|
|
$
|
11,620
|
|
|
$
|
420,883
|
|
(a)
|
Segment cost of operations exclude (1) stock-based compensation expense of
$12.7 million
and
$6.6 million
for the
six
months ended
June 30, 2016 and 2015
, respectively, and (2) prepaid lease purchase price adjustments of
$10.6 million
and
$10.2 million
for the
six
months ended
June 30, 2016 and 2015
, respectively. Segment general and administrative expenses exclude stock-based compensation expense of
$40.0 million
and
$26.2 million
for the
six
months ended
June 30, 2016 and 2015
, respectively.
|
12.
|
Supplemental Cash Flow Information
|
|
Six Months Ended June 30,
|
||||||
|
2016
|
|
2015
|
||||
Supplemental disclosure of cash flow information:
|
|
|
|
||||
Interest paid
|
$
|
217,783
|
|
|
$
|
244,977
|
|
Income taxes paid
|
10,186
|
|
|
8,489
|
|
||
Supplemental disclosure of non-cash investing and financing activities:
|
|
|
|
||||
Increase (decrease) in accounts payable for purchases of property and equipment
|
(10,197
|
)
|
|
(10,102
|
)
|
||
Purchase of property and equipment under capital leases and installment purchases
|
25,444
|
|
|
25,769
|
|
||
Installment payment receivable for sale of CCAL (see note 3)
|
—
|
|
|
117,384
|
|
13.
|
Subsequent Events
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
Grow cash flows from our wireless infrastructure.
We seek to maximize the site rental cash flows derived from our wireless infrastructure by adding tenants on our wireless infrastructure through long-term leases. We believe that the rapid growth in wireless connectivity will result in considerable future demand for our existing wireless infrastructure. We seek to maximize additional tenancy on our wireless infrastructure by working with wireless customers to quickly provide them access to our wireless infrastructure via tenant additions or modifications of existing tenant equipment installations to enable them to expand coverage and capacity in order to meet increasing demand for wireless connectivity. We expect increases in our site rental cash flows from tenant additions and the related subsequent impact from contracted escalations to result in growth in our operating cash flows as our wireless infrastructure has relatively fixed operating costs (which tend to increase at the rate of inflation). We believe there is considerable additional future demand for our existing wireless infrastructure based on their location and the anticipated growth in the wireless communication services industry. Substantially all of our wireless infrastructure can accommodate additional tenancy, either as currently constructed or with appropriate modifications to the structure (which may include extensions or structural reinforcement), from which we expect to generate high incremental returns.
|
•
|
Return cash provided by operating activities to stockholders in the form of dividends
. We believe that distributing a meaningful portion of our cash provided by operating activities appropriately provides stockholders with increased certainty for a portion of expected long-term stockholder value while still retaining sufficient flexibility to invest in our business and deliver growth. We believe this decision reflects the translation of the high-quality, long-term contractual cash flows of our business into stable capital returns to stockholders.
|
•
|
Invest capital efficiently to grow cash flows and long-term dividends per share.
We seek to invest our available capital, including the net cash provided by our operating activities and external financing sources, in a manner that will increase long-term stockholder value on a risk-adjusted basis. Our historical investments have included the following (in no particular order):
|
◦
|
purchases of shares of our common stock from time to time;
|
◦
|
acquisitions or construction of wireless infrastructure;
|
◦
|
acquisitions of land interests under towers;
|
◦
|
improvements and structural enhancements to our existing wireless infrastructure; or
|
◦
|
purchases, repayments or redemptions of our debt.
|
•
|
We operate as a REIT for U.S. federal income tax purposes.
|
◦
|
As a REIT, we are generally entitled to a deduction for dividends that we pay and therefore are not subject to U.S. federal corporate income tax on our taxable income that is distributed to our stockholders.
|
◦
|
To qualify and be taxed as a REIT, we will generally be required to distribute at least 90% of our REIT taxable income, after the utilization of our NOLs (determined without regard to the dividends paid deduction and excluding net capital gain), each year to our stockholders.
|
◦
|
See note
7
to our condensed consolidated financial statements for further discussion of our REIT status.
|
•
|
Potential growth resulting from wireless network expansion and new entrants
|
◦
|
We expect wireless carriers will continue their focus on improving network quality and expanding capacity by utilizing a combination of towers and small cells solutions. We believe our product offerings of towers and small cells provide a comprehensive wireless solution to our customers' growing wireless infrastructure needs.
|
◦
|
We expect existing and potential new customer demand for our wireless infrastructure will result from (1) new technologies, (2) increased usage of wireless applications (including mobile entertainment, mobile internet usage, and machine-to-machine applications), (3) adoption of other emerging and embedded wireless devices (including smartphones, laptops, tablets, and other devices), (4) increasing smartphone penetration, (5) wireless carrier focus on expanding both network quality and capacity, including through the use of both towers and small cells, or (6) the availability of additional spectrum.
|
◦
|
Substantially all of our wireless infrastructure can accommodate additional tenancy, either as currently constructed or with appropriate modifications to the structure.
|
◦
|
U.S. wireless carriers continue to invest in their networks.
|
•
|
Site rental revenues under long-term tenant leases with contractual escalations
|
◦
|
Initial terms of five to 15 years with multiple renewal periods at the option of the tenant of five to ten years each.
|
◦
|
Weighted-average remaining term of approximately six years, exclusive of renewals at the tenant's option, currently representing approximately $20 billion of expected future cash inflows.
|
•
|
Revenues predominately from large wireless carriers
|
◦
|
Approximately
90%
of our site rental revenues were derived from AT&T, Sprint, T-Mobile, and Verizon Wireless. See also
"Item 2. MD&A—General Overview—Outlook Highlights"
presented below.
|
•
|
Majority of land interests under our towers under long-term control
|
◦
|
Nearly 90% of our tower site rental gross margin and more than 75% of our tower site rental gross margin is derived from towers that reside on land that we own or control for greater than ten and 20 years, respectively. The aforementioned amounts include towers that reside on land interests that are owned, including fee interests and perpetual easements, which represent over one-third of our tower site rental gross margin.
|
•
|
Relatively fixed wireless infrastructure operating costs
|
◦
|
Our wireless infrastructure operating costs tend to increase at approximately the rate of inflation and are not typically influenced by tenant additions.
|
•
|
Minimal sustaining capital expenditure requirements
|
◦
|
Sustaining capital expenditures represented approximately
2%
of net revenues.
|
•
|
Debt portfolio with long-dated maturities extended over multiple years, with the majority of such debt having a fixed rate (see
"Item 3. Quantitative and Qualitative Disclosures About Market Risk"
for a further discussion of our debt)
|
◦
|
81%
of our debt is fixed rate.
|
◦
|
Our debt service coverage and leverage ratios were comfortably within their respective financial maintenance covenants.
|
◦
|
In January 2016, we completed a new senior unsecured credit facility and utilized the proceeds to repay the previously outstanding 2012 Credit Facility. In February 2016, we issued $1.5 billion aggregate principal amount of senior unsecured notes. In May 2016, we issued 3.4% senior notes due February 2021 and 3.7%
|
•
|
Significant cash flows from operations
|
◦
|
Net cash provided by operating activities was
$918.2 million
.
|
◦
|
We expect to grow our core business of providing access to our wireless infrastructure as a result of contractual escalators and future anticipated additional demand for our wireless infrastructure.
|
•
|
Returning cash flows provided by operations to stockholders in the form of dividends
|
◦
|
During each of March and June 2016, we paid a common stock cash dividend of $0.885 per share, totaling approximately
$597.8 million
. We currently expect our anticipated quarterly dividends to result in aggregate annual cash payments of at least
$1.2 billion
during 2016, or an annual amount of $3.54 per share. Over time, we expect to increase our dividend per share generally commensurate with our realized growth in cash flows. Future dividends are subject to the approval of our board of directors.
|
•
|
Investing capital efficiently to grow long-term dividends per share
|
◦
|
Discretionary capital expenditures were
$363.8 million
, including wireless infrastructure improvements in order to support additional site rentals, construction of wireless infrastructure and land purchases.
|
•
|
We expect that our full year 2016 site rental revenue growth will benefit from similar levels of tenant additions as in 2015, as large wireless carriers upgrade and enhance their networks, partially offset by anticipated non-renewals of tenant leases primarily resulting from our customers' decommissioning of the Acquired Networks.
|
•
|
We expect capital expenditures for 2016 to equal or exceed 2015 levels. We also expect sustaining capital expenditures to be approximately 2% of net revenues for full year 2016.
|
($ in thousands)
|
|
Three Months Ended June 30,
|
|
|
|
|
||
|
2016
|
|
2015
|
|
$ Change
|
|
% Change
|
|
Site rental revenues
|
|
$804,600
|
|
$737,091
|
|
+$67,509
|
|
9%
|
Site rental gross margin
|
|
$551,748
|
|
$500,060
|
|
+$51,688
|
|
10%
|
Network services and other gross margin
|
|
$61,942
|
|
$72,946
|
|
$(11,004)
|
|
(15)%
|
Adjusted EBITDA
(a)
|
|
$549,669
|
|
$520,926
|
|
+$28,743
|
|
6%
|
Net income attributable to CCIC common stockholders
|
|
$75,061
|
|
$1,142,363
|
|
$(1,067,302)
|
|
(93)%
|
(a)
|
See reconciliation of Adjusted EBITDA in
"Item 2. MD&A—Accounting and Reporting Matters—Non-GAAP Financial Measures."
|
(a)
|
Includes amortization of prepaid rent and the construction of small cells.
|
(b)
|
Represents initial contribution of acquisitions and tower builds until the one-year anniversary of the acquisition or build.
|
($ in thousands)
|
|
Six Months Ended June 30,
|
|
|
|
|
||
|
2016
|
|
2015
|
|
$ Change
|
|
% Change
|
|
Site rental revenues
|
|
$1,603,893
|
|
$1,468,471
|
|
+$135,422
|
|
9%
|
Site rental gross margin
|
|
$1,098,421
|
|
$999,227
|
|
+$99,194
|
|
10%
|
Network services and other gross margin
|
|
$116,061
|
|
$155,119
|
|
$(39,058)
|
|
(25)%
|
Adjusted EBITDA
(a)
|
|
$1,088,787
|
|
$1,050,225
|
|
+$38,562
|
|
4%
|
Net income attributable to CCIC common stockholders
|
|
$111,904
|
|
$1,254,153
|
|
$(1,142,249)
|
|
(91)%
|
(a)
|
See reconciliation of Adjusted EBITDA in
"Item 2. MD&A—Accounting and Reporting Matters—Non-GAAP Financial Measures."
|
(a)
|
Includes amortization of prepaid rent and the construction of small cells.
|
(b)
|
Represents initial contribution of acquisitions and tower builds until the one-year anniversary of the acquisition or build.
|
($ in thousands)
|
|
Three Months Ended June 30,
|
|
|
|
|
||
|
2016
|
|
2015
|
|
$ Change
|
|
% Change
|
|
Segment site rental revenues
|
|
$705,716
|
|
$678,306
|
|
+$27,410
|
|
4%
|
Segment site rental gross margin
|
|
$495,272
|
|
$471,269
|
|
+$24,003
|
|
5%
|
Segment network services and other gross margin
|
|
$60,131
|
|
$73,061
|
|
$(12,930)
|
|
(18)%
|
Segment operating profit
|
|
$532,898
|
|
$521,801
|
|
+$11,097
|
|
2%
|
($ in thousands)
|
|
Three Months Ended June 30,
|
|
|
|
|
||
|
2016
|
|
2015
|
|
$ Change
|
|
% Change
|
|
Segment site rental revenues
|
|
$98,884
|
|
$58,785
|
|
+$40,099
|
|
68%
|
Segment site rental gross margin
|
|
$64,719
|
|
$35,929
|
|
+$28,790
|
|
80%
|
Segment network services and other gross margin
|
|
$3,333
|
|
$1,247
|
|
+$2,086
|
|
167%
|
Segment operating profit
|
|
$52,334
|
|
$29,266
|
|
+$23,068
|
|
79%
|
($ in thousands)
|
|
Six Months Ended June 30,
|
|
|
|
|
||
|
2016
|
|
2015
|
|
$ Change
|
|
% Change
|
|
Segment site rental revenues
|
|
$1,408,555
|
|
$1,353,213
|
|
+$55,342
|
|
4%
|
Segment site rental gross margin
|
|
$993,546
|
|
$941,543
|
|
+$52,003
|
|
6%
|
Segment network services and other gross margin
|
|
$115,152
|
|
$153,255
|
|
$(38,103)
|
|
(25)%
|
Segment operating profit
|
|
$1,062,594
|
|
$1,049,547
|
|
+$13,047
|
|
1%
|
($ in thousands)
|
|
Six Months Ended June 30,
|
|
|
|
|
||
|
2016
|
|
2015
|
|
$ Change
|
|
% Change
|
|
Segment site rental revenues
|
|
$195,338
|
|
$115,258
|
|
+$80,080
|
|
69%
|
Segment site rental gross margin
|
|
$123,690
|
|
$71,889
|
|
+$51,801
|
|
72%
|
Segment network services and other gross margin
|
|
$5,378
|
|
$4,499
|
|
+$879
|
|
20%
|
Segment operating profit
|
|
$97,828
|
|
$60,918
|
|
+$36,910
|
|
61%
|
|
June 30, 2016
|
||
|
(In thousands of dollars)
|
||
Cash and cash equivalents
(a)
|
$
|
202,338
|
|
Undrawn 2016 Revolver availability
(b)
|
2,065,000
|
|
|
Total debt and other long-term obligations
|
12,426,204
|
|
|
Total equity
|
6,948,307
|
|
(a)
|
Exclusive of restricted cash.
|
(b)
|
Availability at any point in time is subject to certain restrictions based on the maintenance of financial covenants contained in the 2016 Credit Facility. See our
2015
Form 10-K.
|
•
|
Our liquidity sources may include (1) cash on hand, (2) net cash provided by operating activities (net of cash interest payments), (3) undrawn availability from our 2016 Revolver, and (4) issuances of equity pursuant to our ATM Program. Our liquidity uses over the next 12 months are expected to include (1) debt service obligations of
$100.3 million
(principal payments), (2) common stock dividend payments expected to be at least $3.54 per share, or an aggregate of at least
$1.2 billion
, subject to future approval by our board of directors (see
"Item 2. MD&A—Business Fundamentals and Results"
), (3) sustaining and discretionary capital expenditures (expected to be equal to or greater than current levels), and (4) Convertible Preferred Stock dividend payments prior to anticipated conversion in November 2016 of approximately $22 million. During the next 12 months, we expect that our liquidity sources should be sufficient to cover our expected uses. As CCIC is a holding company, our cash flow from operations is generated by our operating subsidiaries.
|
•
|
Our 9.8 million shares of Convertible Preferred Stock will automatically convert to shares of common stock on November 1, 2016, unless converted earlier, at a conversion rate dependent on the applicable market value of the common stock and subject to certain anti-dilution adjustments. See
"Item 2. MD&A—Convertible Preferred Stock Activity
.
"
|
•
|
We have no scheduled contractual debt maturities other than principal payments on amortizing debt. See
"Item 3. Quantitative and Qualitative Disclosures About Market Risk"
for a tabular presentation as of
June 30, 2016
of our scheduled contractual debt maturities and a discussion of anticipated repayment dates.
|
|
Six Months Ended June 30,
|
||||||||||
|
2016
|
|
2015
|
|
Change
|
||||||
|
(In thousands of dollars)
|
||||||||||
Net increase (decrease) in cash and cash equivalents provided by (used for) continuing operations:
|
|
|
|
|
|
||||||
Operating activities
|
$
|
918,181
|
|
|
$
|
918,878
|
|
|
$
|
(697
|
)
|
Investing activities
|
(876,934
|
)
|
|
(439,213
|
)
|
|
(437,721
|
)
|
|||
Financing activities
|
(131,189
|
)
|
|
(1,424,165
|
)
|
|
1,292,976
|
|
|||
Net increase (decrease) in cash and cash equivalents from continuing operations
|
(89,942
|
)
|
|
(944,500
|
)
|
|
854,558
|
|
|||
Net increase (decrease) in cash and cash equivalents from discontinued operations
|
113,150
|
|
|
1,108,458
|
|
|
(995,308
|
)
|
|||
Effect of exchange rate changes on cash
|
320
|
|
|
(969
|
)
|
|
1,289
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
$
|
23,528
|
|
|
$
|
162,989
|
|
|
$
|
(139,461
|
)
|
•
|
Discretionary capital expenditures are made with respect to activities which we believe exhibit sufficient potential to enhance long-term stockholder value. They consist of improvements to existing wireless infrastructure, construction of new wireless infrastructure, and, to a lesser extent, purchases of land assets under towers as we seek to manage our interests in the land beneath our towers. Improvements to existing wireless infrastructure to accommodate new leasing typically vary based on, among other factors: (1) the type of wireless infrastructure, (2) the scope, volume, and mix of work performed on the wireless infrastructure, (3) existing capacity prior to installation, or (4) changes in structural engineering regulations and standards. Our decisions regarding capital expenditures are influenced by the availability and cost of capital and expected returns on alternative uses of cash, such as payments of dividends and investments.
|
•
|
Sustaining capital expenditures consist of (1) corporate-related capital improvements and (2) maintenance on our wireless infrastructure assets that enable our customers' ongoing quiet enjoyment of the wireless infrastructure.
|
|
Three Months Ended June 30,
|
||||||
|
2016
|
|
2015
|
||||
Net income (loss)
|
$
|
86,058
|
|
|
$
|
1,154,378
|
|
Adjustments to increase (decrease) net income (loss):
|
|
|
|
||||
Income (loss) from discontinued operations
|
—
|
|
|
(987,852
|
)
|
||
Asset write-down charges
|
11,952
|
|
|
3,620
|
|
||
Acquisition and integration costs
|
3,141
|
|
|
2,377
|
|
||
Depreciation, amortization and accretion
|
276,026
|
|
|
253,153
|
|
||
Amortization of prepaid lease purchase price adjustments
|
5,367
|
|
|
5,070
|
|
||
Interest expense and amortization of deferred financing costs
|
129,362
|
|
|
134,466
|
|
||
Gains (losses) on retirement of long-term obligations
|
11,468
|
|
|
4,181
|
|
||
Interest income
|
(105
|
)
|
|
(325
|
)
|
||
Other income (expense)
|
518
|
|
|
(59,973
|
)
|
||
Benefit (provision) for income taxes
|
3,884
|
|
|
(4,144
|
)
|
||
Stock-based compensation expense
|
21,998
|
|
|
15,975
|
|
||
Adjusted EBITDA
|
$
|
549,669
|
|
|
$
|
520,926
|
|
|
Six Months Ended June 30,
|
||||||
|
2016
|
|
2015
|
||||
Net income (loss)
|
$
|
133,898
|
|
|
$
|
1,279,490
|
|
Adjustments to increase (decrease) net income (loss):
|
|
|
|
||||
Income (loss) from discontinued operations
|
—
|
|
|
(1,001,230
|
)
|
||
Asset write-down charges
|
19,912
|
|
|
12,175
|
|
||
Acquisition and integration costs
|
8,779
|
|
|
4,393
|
|
||
Depreciation, amortization and accretion
|
553,901
|
|
|
504,959
|
|
||
Amortization of prepaid lease purchase price adjustments
|
10,569
|
|
|
10,244
|
|
||
Interest expense and amortization of deferred financing costs
|
255,740
|
|
|
268,905
|
|
||
Gains (losses) on retirement of long-term obligations
|
42,017
|
|
|
4,157
|
|
||
Interest income
|
(279
|
)
|
|
(381
|
)
|
||
Other income (expense)
|
3,791
|
|
|
(59,724
|
)
|
||
Benefit (provision) for income taxes
|
7,756
|
|
|
(5,579
|
)
|
||
Stock-based compensation expense
|
52,703
|
|
|
32,816
|
|
||
Adjusted EBITDA
|
$
|
1,088,787
|
|
|
$
|
1,050,225
|
|
•
|
it is the primary measure used by our management to evaluate the (1) economic productivity of our operations and (2) for purposes of making decisions about allocating resources to, and assessing the performance of our operations;
|
•
|
it is similar to the measure of current financial performance generally used in our debt covenant calculations;
|
•
|
although specific definitions may vary, it is widely used by investors or other interested parties in evaluation of the wireless 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; and
|
•
|
we believe it helps investors and other interested parties meaningfully evaluate and compare the results of our operations (1) from period to period and (2) to our competitors by excluding 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.
|
•
|
with respect to compliance with our debt covenants, which require us to maintain certain financial ratios including, or similar to, Adjusted EBITDA;
|
•
|
as a performance goal in employee annual incentive compensation;
|
•
|
as a measurement of financial performance because it assists us in comparing our financial performance on a consistent basis as it removes the impact of our capital structure (primarily interest charges from our outstanding debt) and asset base (primarily depreciation, amortization and accretion) from our operating results;
|
•
|
in presentations to our board of directors to enable it to have the same measurement of financial performance used by management;
|
•
|
for planning purposes, including preparation of our annual operating budget;
|
•
|
as a valuation measure in strategic analyses in connection with the purchase and sale of assets; and
|
•
|
in determining self-imposed limits on our debt levels, including the evaluation of our leverage ratio and interest coverage ratio.
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
•
|
the potential refinancing of our existing debt (
$12.4 billion
outstanding at
June 30, 2016
and
$12.1 billion
at
December 31, 2015
);
|
•
|
our
$2.4 billion
and
$4.0 billion
of floating rate debt at
June 30, 2016
and
December 31, 2015
, respectively, which represented approximately
19%
and
33%
of our total debt, as of
June 30, 2016
and as of
December 31, 2015
, respectively; and
|
•
|
potential future borrowings of incremental debt, including borrowings on our 2016 Credit Facility.
|
|
Future Principal Payments and Interest Rates by the Debt Instruments' Contractual Year of Maturity
|
||||||||||||||||||||||||||||||
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
Thereafter
|
|
Total
|
|
Fair Value
(a)
|
||||||||||||||||
|
(Dollars in thousands)
|
||||||||||||||||||||||||||||||
Debt:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fixed rate
(c)
|
$
|
24,938
|
|
|
$
|
549,019
|
|
(f)
|
$
|
45,580
|
|
|
$
|
37,058
|
|
|
$
|
25,788
|
|
|
$
|
9,415,756
|
|
|
$
|
10,098,139
|
|
|
$
|
10,858,794
|
|
Average interest rate
(b)(c)(d)
|
4.5
|
%
|
|
2.6
|
%
|
|
4.7
|
%
|
|
4.9
|
%
|
|
5.0
|
%
|
|
6.3
|
%
|
|
6.1
|
%
|
|
|
|||||||||
Variable rate
(e)
|
$
|
25,000
|
|
|
$
|
50,000
|
|
|
$
|
87,500
|
|
|
$
|
100,000
|
|
|
$
|
175,000
|
|
|
$
|
1,985,000
|
|
|
$
|
2,422,500
|
|
|
$
|
2,402,625
|
|
Average interest rate
(e)
|
2.0
|
%
|
|
2.4
|
%
|
|
2.6
|
%
|
|
2.8
|
%
|
|
2.9
|
%
|
|
3.0
|
%
|
|
3.0
|
%
|
|
|
(a)
|
The fair value of our debt is based on indicative quotes (that is, non-binding quotes) from brokers that require judgment to interpret market information, including implied credit spreads for similar borrowings on recent trades or bid/ask offers. These fair values are not necessarily indicative of the amount which could be realized in a current market exchange.
|
(b)
|
The average interest rate represents the weighted-average stated coupon rate (see footnotes (c) and (d)).
|
(c)
|
The impact of principal payments that will
commence following
the anticipated repayment dates is not considered.
The January 2010 Tower Revenue Notes have a principal amount of $1.3 billion, having an anticipated repayment date in January 2020. The August 2010 Tower Revenue Notes have a principal amount of $1.0 billion, having an anticipated repayment date in August 2020.
The May 2015 Tower Revenue Notes consist of two series of notes with principal amounts of $300.0 million and $700.0 million, having anticipated repayment dates of May 2022 and May 2025, respectively.
|
(d)
|
If the Tower Revenue Notes are not repaid in full by the applicable anticipated repayment dates, the applicable interest rate increases by approximately 5% per annum and monthly principal payments commence using the Excess Cash Flow of the issuers of the Tower Revenue Notes. The Tower Revenue Notes are presented based on their contractual maturity dates ranging from 2040 to 2045 and include the impact of an assumed 5% increase in interest rate that would occur following the anticipated repayment dates but exclude the impact of monthly principal payments that would commence using Excess Cash Flow of the issuers of the Tower Revenue Notes. The full year
2015
Excess Cash Flow of the issuers of the Tower Revenue Notes was approximately $
495.4 million
.
We currently expect to refinance these notes on or prior to the respective anticipated repayment dates.
|
(e)
|
Predominantly consists of $2.0 billion 2016 Term Loan A maturing in 2021. See note
5
to our condensed consolidated financial statements.
|
(f)
|
Predominantly consists of $500.0 million in aggregate principal of 2.381% secured notes due December 2017.
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs
|
|||||
|
|
(In thousands)
|
|
|
|
|
|
|
|||||
April 1 - April 30, 2016
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
May 1 - May 31, 2016
|
|
1
|
|
|
90.81
|
|
|
—
|
|
|
—
|
|
|
June 1 - June 30, 2016
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
1
|
|
|
$
|
90.81
|
|
|
—
|
|
|
—
|
|
ITEM 6.
|
EXHIBITS
|
|
|
CROWN CASTLE INTERNATIONAL CORP.
|
||
|
|
|
|
|
Date:
|
August 4, 2016
|
|
By:
|
/s/ Daniel K. Schlanger
|
|
|
|
|
Daniel K. Schlanger
|
|
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
|
|
|
|
|
|
Date:
|
August 4, 2016
|
|
By:
|
/s/ Rob A. Fisher
|
|
|
|
|
Rob A. Fisher
|
|
|
|
|
Vice President and Controller
|
|
|
|
|
(Principal Accounting Officer)
|
Exhibit No.
|
|
Description
|
|
|
|
|
|
(a)
|
3.1
|
|
Restated Certificate of Incorporation of Crown Castle International Corp. (including the Certificate of Designations of 4.50% Mandatory Convertible Preferred Stock, Series A, incorporated therein as Exhibit I)
|
|
|
|
|
(b)
|
3.2
|
|
Amended and Restated By-Laws of Crown Castle International Corp., dated July 30, 2015
|
|
|
|
|
(c)
|
4.2
|
|
Fifth Supplemental Indenture dated May 6, 2016, between Crown Castle International Corp. and The Bank of New York Mellon Trust Company, N.A., as trustee, to the Indenture dated April 15, 2014, between Crown Castle International Corp. and The Bank of New York Mellon Trust Company, N.A., as trustee
|
|
|
|
|
*
|
10.1
|
|
Amendment to 2013 Long Term Incentive Plan, as amended
|
|
|
|
|
*
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002
|
|
|
|
|
*
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Section 302 of Sarbanes-Oxley Act of 2002
|
|
|
|
|
*
|
32.1
|
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of Sarbanes-Oxley Act of 2002
|
|
|
|
|
*
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
|
*
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
*
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
*
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
*
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
|
|
|
|
*
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Filed herewith.
|
(a)
|
Incorporated by reference to the exhibit previously filed by the Registrant on Form 8-K (File No. 001-16441) on December 16, 2014.
|
(b)
|
Incorporated by reference to the exhibit previously filed by the Registrant on Form 8-K (File No. 001-16441) on August 4, 2015.
|
(c)
|
Incorporated by reference to the exhibit previously filed by the Registrant on Form 8-K (File No. 001-16441) on May 6, 2016.
|
|
|
|
1.
|
I have reviewed this report on Form 10-Q of Crown Castle International Corp. (“registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Jay A. Brown
|
|
|
Jay A. Brown
President and Chief Executive Officer
|
|
1.
|
I have reviewed this report on Form 10-Q of Crown Castle International Corp. (“registrant”);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ Daniel K. Schlanger
|
|
|
Daniel K. Schlanger
Senior Vice President and Chief Financial Officer
|
|
1)
|
the Report complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of
June 30, 2016
(the last date of the period covered by the Report).
|
|
/s/ Jay A. Brown
|
|
|
Jay A. Brown
President and Chief Executive Officer
|
|
|
August 4, 2016
|
|
|
|
|
|
/s/ Daniel K. Schlanger
|
|
|
Daniel K. Schlanger
Senior Vice President and Chief Financial Officer
|
|
|
August 4, 2016
|
|