CrownCastle 10Q 093013
 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________
 
FORM 10-Q
____________________________________
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2013
OR
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period              to             

Commission File Number 001-16441
____________________________________
CROWN CASTLE INTERNATIONAL
CORP.
(Exact name of registrant as specified in its charter)
 
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)
____________________________________
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  o
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

 
Large accelerated filer
x
 
Accelerated filer
o
 
 
Non-accelerated filer
o
 
Smaller reporting company
o
 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  o    No  x

Number of shares of common stock outstanding at November 1, 2013: 334,070,455
 


CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

INDEX

 
 
 
Page
 
ITEM 1.
 
 
 
 
 
 
 
 
 
 
 
ITEM 2.
 
ITEM 3.
 
ITEM 4.
 
 
ITEM 1.
LEGAL PROCEEDINGS
 
ITEM 1A.
 
ITEM 2.
UNREGISTERED SALES OF EQUITY SECURITIES
 
ITEM 6.
 
 
EXHIBIT INDEX
 

Cautionary Language Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q ("Form 10-Q") contains forward-looking statements that are based on our management's expectations as of the filing date of this report with the SEC. Statements that are not historical facts are hereby identified as forward-looking statements. In addition, words such as "estimate," "anticipate," "project," "plan," "intend," "believe," "expect," "likely," "predicted," forms of these words and similar expressions are intended to identify forward-looking statements. Such statements include plans, projections and estimates contained in "Part I—Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Part I—Item 3. Quantitative and Qualitative Disclosures About Market Risk" herein. Such forward-looking statements include (1) expectations regarding anticipated growth in the wireless communication industry, carriers' investments in their networks, new tenant additions, cancellations of customer contracts, including the impact of the iDEN network decommissioning, customer consolidation or ownership changes, and demand for our towers and small cell networks, (2) availability of cash flows and liquidity for, and plans regarding, future discretionary investments including capital expenditures, (3) anticipated growth in our future revenues, margins, Adjusted EBITDA and operating cash flows, (4) expectations regarding the credit markets, our availability and cost of capital, and our ability to service our debt and comply with debt covenants, (5) our intention to convert to a real estate investment trust ("REIT"), and the timing and impact thereof on our financial statements and our expected dividend policy, (6) the potential advantages, benefits and impact of, and opportunities created by, converting to a REIT, (7) our intention to pursue certain steps and corporate actions in connection with our potential REIT conversion, including our future inclusion of REIT-related ownership limitations and transfer restrictions related to our capital stock, (8) our expected dividend policy and the timing and the amount and growth of any dividends, (9) timing of the Proposed AT&T Transaction (as defined below) and (10) financing and funding of the Proposed AT&T Transaction.
Such forward-looking statements are subject to certain risks, uncertainties and assumptions, including prevailing market conditions, risk factors described under "Part II—Item 1A. Risk Factors" herein and in "Item 1A. Risk Factors" of our Annual Report on Form 10-K for the fiscal year ended December 31, 2012 ("2012 Form 10-K") and other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected. As used herein, the term "including," and any variation of thereof, means "including without limitation." The use of the word "or" herein is not exclusive.

1

PART I—FINANCIAL INFORMATION
ITEM 1.
FINANCIAL STATEMENTS

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands of dollars, except share amounts)
 
September 30,
2013
 
December 31,
2012
 
(Unaudited)
 
 
ASSETS
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
218,649

 
$
441,364

Restricted cash
157,699

 
575,938

Receivables, net
236,211

 
192,833

Prepaid expenses
117,866

 
103,808

Deferred income tax assets
189,878

 
193,420

Other current assets
79,500

 
73,961

Total current assets
999,803

 
1,581,324

Deferred site rental receivables, net
1,031,966

 
864,819

Property and equipment, net of accumulated depreciation of $4,611,200 and $4,249,183, respectively
6,904,346

 
6,917,531

Goodwill
3,140,308

 
3,119,957

Other intangible assets, net
2,821,812

 
2,941,696

Deferred income tax assets
21,311

 
33,914

Long-term prepaid rent, deferred financing costs and other assets, net
648,026

 
629,468

Total assets
$
15,567,572

 
$
16,088,709

 
 
 
 
LIABILITIES AND EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable
$
119,689

 
$
115,999

Accrued interest
64,571

 
52,592

Deferred revenues
248,807

 
241,127

Other accrued liabilities
131,273

 
140,084

Current maturities of debt and other obligations
115,378

 
688,056

Total current liabilities
679,718

 
1,237,858

Debt and other long-term obligations
10,660,076

 
10,923,186

Deferred income tax liabilities
153,967

 
65,830

Below-market tenant leases, deferred ground lease payable and other liabilities
1,076,521

 
910,571

Total liabilities
12,570,282

 
13,137,445

Commitments and contingencies (note 8)

 

CCIC stockholders' equity:
 
 
 
Common stock, $.01 par value; 600,000,000 shares authorized; shares issued and outstanding: September 30, 2013—292,675,430 and December 31, 2012—293,164,786
2,927

 
2,932

Additional paid-in capital
5,553,717

 
5,623,595

Accumulated other comprehensive income (loss)
(61,339
)
 
(61,791
)
Accumulated deficit
(2,512,333
)
 
(2,625,990
)
Total CCIC stockholders' equity
2,982,972

 
2,938,746

Noncontrolling interest
14,318

 
12,518

Total equity
2,997,290

 
2,951,264

Total liabilities and equity
$
15,567,572

 
$
16,088,709

 
See notes to condensed consolidated financial statements.

2

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS) (Unaudited)
(In thousands of dollars, except per share amounts)
 
Three Months Ended September 30, 2013
 
Nine Months Ended September 30, 2013
 
2013
 
2012
 
2013
 
2012
Net revenues:
 
 
 
 
 
 
 
Site rental
$
620,766

 
$
538,761

 
$
1,853,030

 
$
1,553,878

Network services and other
128,211

 
82,576

 
370,935

 
204,715

Net revenues
748,977

 
621,337

 
2,223,965

 
1,758,593

Operating expenses:
 
 
 
 
 
 
 
Costs of operations(a):
 
 
 
 
 
 
 
Site rental
181,966

 
135,314

 
538,587

 
389,756

Network services and other
81,998

 
50,029

 
229,574

 
121,812

General and administrative
58,504

 
55,862

 
171,539

 
153,941

Asset write-down charges
3,893

 
1,560

 
10,705

 
8,250

Acquisition and integration costs
4,369

 
2,937

 
13,186

 
12,112

Depreciation, amortization and accretion
195,408

 
154,867

 
572,518

 
446,749

Total operating expenses
526,138

 
400,569

 
1,536,109

 
1,132,620

Operating income (loss)
222,839

 
220,768

 
687,856

 
625,973

Interest expense and amortization of deferred financing costs
(142,016
)
 
(144,949
)
 
(446,641
)
 
(427,361
)
Gains (losses) on retirement of long-term obligations
(1
)
 
—

 
(36,487
)
 
(14,586
)
Interest income
236

 
291

 
861

 
1,027

Other income (expense)
(631
)
 
(632
)
 
(753
)
 
(3,958
)
Income (loss) before income taxes
80,427

 
75,478

 
204,836

 
181,095

Benefit (provision) for income taxes
(33,959
)
 
(32,300
)
 
(88,254
)
 
29,437

Net income (loss)
46,468

 
43,178

 
116,582

 
210,532

Less: Net income (loss) attributable to the noncontrolling interest
632

 
1,133

 
2,925

 
2,443

Net income (loss) attributable to CCIC stockholders
45,836

 
42,045

 
113,657

 
208,089

Dividends on preferred stock
—

 
—

 
—

 
(2,629
)
Net income (loss) attributable to CCIC stockholders after deduction of dividends on preferred stock
$
45,836

 
$
42,045

 
$
113,657

 
$
205,460

Net income (loss)
$
46,468

 
$
43,178

 
$
116,582

 
$
210,532

Other comprehensive income (loss):
 
 
 
 
 
 
 
Interest rate swaps, net of taxes of $5,678, $5,705, $17,054, and $11,415, respectively:
 
 
 
 
 
 
 
Amounts reclassified into "interest expense and amortization deferred financing costs", net of taxes (see note 4)
10,544

 
10,594

 
31,671

 
37,541

Foreign currency translation adjustments
5,874

 
6,876

 
(32,344
)
 
7,120

Total other comprehensive income (loss)
16,418

 
17,470

 
(673
)
 
44,661

Comprehensive income (loss)
62,886

 
60,648

 
115,909

 
255,193

Less: Comprehensive income (loss) attributable to the noncontrolling interest
898

 
1,171

 
1,800

 
1,741

Comprehensive income (loss) attributable to CCIC stockholders
$
61,988

 
$
59,477

 
$
114,109

 
$
253,452

Net income (loss) attributable to CCIC common stockholders, after deduction of dividends on preferred stock, per common share:
 
 
 
 
 
 
 
Basic
$
0.16

 
$
0.14

 
$
0.39

 
$
0.71

Diluted
$
0.16

 
$
0.14

 
$
0.39

 
$
0.71

Weighted-average common shares outstanding (in thousands):
 
 
 
 
 
 
 
Basic
290,372
 
290,762

 
290,900
 
288,775
Diluted
291,378
 
292,098

 
292,043
 
290,527
________________
(a)
Exclusive of depreciation, amortization and accretion shown separately.

See notes to condensed consolidated financial statements.

3

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
(In thousands of dollars)
 
Nine Months Ended
September 30,
 
2013
 
2012
Cash flows from operating activities:
 
 
 
Net income (loss)
$
116,582

 
$
210,532

Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:
 
 
 
Depreciation, amortization and accretion
572,518

 
446,749

Gains (losses) on retirement of long-term obligations
36,487

 
14,586

Amortization of deferred financing costs and other non-cash interest
78,241

 
74,269

Stock-based compensation expense
29,334

 
33,573

Asset write-down charges
10,705

 
8,250

Deferred income tax benefit (provision)
80,999

 
(35,140
)
Other adjustments
2,167

 
13

Changes in assets and liabilities, excluding the effects of acquisitions:
 
 
 
Increase (decrease) in accrued interest
11,979

 
(11,525
)
Increase (decrease) in accounts payable
8,279

 
(494
)
Increase (decrease) in deferred revenues, deferred ground lease payables, other accrued liabilities and
     other liabilities
127,463

 
31,230

Decrease (increase) in receivables
(45,689
)
 
(44,213
)
Decrease (increase) in prepaid expenses, deferred site rental receivables, long-term prepaid rent,
     restricted cash and other assets
(190,199
)
 
(203,372
)
Net cash provided by (used for) operating activities
838,866

 
524,458

Cash flows from investing activities:
 
 
 
Payments for acquisitions of businesses, net of cash acquired
(55,131
)
 
(1,236,238
)
Capital expenditures
(385,482
)
 
(283,386
)
Other investing activities, net
7,601

 
1,244

Net cash provided by (used for) investing activities
(433,012
)
 
(1,518,380
)
Cash flows from financing activities:
 
 
 
Proceeds from issuance of long-term debt
830,941

 
2,100,000

Proceeds from issuance of capital stock
—

 
239

Principal payments on debt and other long-term obligations
(77,986
)
 
(59,579
)
Purchases and redemptions of long-term debt
(675,481
)
 
(699,486
)
Purchases of capital stock
(99,217
)
 
(35,984
)
Borrowings under revolving credit facility
94,000

 
—

Payments under revolving credit facility
(1,092,000
)
 
(251,000
)
Payments for financing costs
(20,753
)
 
(40,255
)
Net (increase) decrease in restricted cash
415,498

 
19,533

Dividends on preferred stock
—

 
(2,481
)
Net cash provided by (used for) financing activities
(624,998
)
 
1,030,987

Effect of exchange rate changes on cash
(3,571
)
 
1,718

Net increase (decrease) in cash and cash equivalents
(222,715
)
 
38,783

Cash and cash equivalents at beginning of period
441,364

 
80,120

Cash and cash equivalents at end of period
$
218,649

 
$
118,903


See notes to condensed consolidated financial statements.

4

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF REDEEMABLE CONVERTIBLE PREFERRED STOCK AND EQUITY
(In thousands of dollars, except share amounts) (Unaudited)

 
 
 
 
 
CCIC Stockholders
 
 
 
 
 
Redeemable Convertible Preferred Stock
 
Common Stock
 
 
 
AOCI
 
 
 
 
 
 
 
Shares
 
Amount
 
Shares
 
($.01 Par)
 
Additional
Paid-In
Capital
 
Foreign Currency Translation Adjustments
 
Derivative Instruments, net of tax
 
Accumulated
Deficit
 
Noncontrolling
Interest
 
Total
Balance, July 1, 2013
—

 
$
—

 
292,685,462

 
$
2,927

 
$
5,544,205

 
$
65,298

 
$
(142,789
)
 
$
(2,558,169
)
 
$
13,420

 
$
2,924,892

Stock-based compensation related activity, net of forfeitures
—

 
—

 
(5,001
)
 
—

 
9,862

 
—

 
—

 
—

 
—

 
9,862

Purchases and retirement of capital stock
—

 
—

 
(5,031
)
 
—

 
(350
)
 
—

 
—

 
—

 
—

 
(350
)
Other comprehensive income (loss)(a)
—

 
—

 
—

 
—

 
—

 
5,608

 
10,544

 
—

 
266

 
16,418

Net income (loss)
—

 
—

 
—

 
—

 
—

 
—

 
—

 
45,836

 
632

 
46,468

Balance, September 30, 2013
—

 
$
—

 
292,675,430

 
$
2,927

 
$
5,553,717

 
$
70,906

 
$
(132,245
)
 
$
(2,512,333
)
 
$
14,318

 
$
2,997,290


 
 
 
 
 
CCIC Stockholders
 
 
 
 
 
 
 
Redeemable Convertible Preferred Stock
 
Common Stock
 
 
 
AOCI
 
 
 
 
 
 
 
Shares
 
Amount
 
Shares
 
($.01 Par)
 
Additional
Paid-In
Capital
 
Foreign Currency Translation Adjustments
 
Derivative Instruments, net of tax
 
Accumulated
Deficit
 
Noncontrolling
Interest
 
Total
Balance, July 1, 2012
—

 
$
—

 
293,038,013

 
$
2,930

 
$
5,599,106

 
$
96,028

 
$
(185,093
)
 
$
(2,648,530
)
 
$
1,557

 
$
2,865,998

Stock-based compensation related activity, net of forfeitures
—

 
—

 
127,860

 
2

 
16,468

 
—

 
—

 
—

 
—

 
16,470

Purchases and retirement of capital stock
—

 
—

 
(4,804
)
 
—

 
(311
)
 
—

 
—

 
—

 
—

 
(311
)
Other comprehensive income (loss)(a)
—

 
—

 
—

 
—

 
—

 
6,838

 
10,594

 
—

 
38

 
17,470

Disposition of noncontrolling interest
—

 
—

 
—

 
—

 
—

 
—

 
 
 
—

 
—

 
—

Net income (loss)
—

 
—

 
—

 
—

 
—

 
—

 
—

 
42,045

 
1,133

 
43,178

Balance, September 30, 2012
—

 
$
—

 
293,161,069

 
$
2,932

 
$
5,615,263

 
$
102,866

 
$
(174,499
)
 
$
(2,606,485
)
 
$
2,728

 
$
2,942,805

___________________________
(a)
See the statement of operations and other comprehensive income (loss) for the components of "other comprehensive income (loss)" and note 4 with respect to the reclassification adjustment.

See notes to condensed consolidated financial statements.

5

 
 
 
 
 
CCIC Stockholders
 
 
 
 
 
Redeemable Convertible Preferred Stock
 
Common Stock
 
 
 
AOCI
 
 
 
 
 
 
 
Shares
 
Amount
 
Shares
 
($.01 Par)
 
Additional
Paid-In
Capital
 
Foreign Currency Translation Adjustments
 
Derivative Instruments, net of tax
 
Accumulated
Deficit
 
Noncontrolling
Interest
 
Total
Balance, January 1, 2013
—

 
$
—

 
293,164,786


$
2,932


$
5,623,595


$
102,125


$
(163,916
)

$
(2,625,990
)

$
12,518

 
$
2,951,264

Stock-based compensation related activity, net of forfeitures
—

 
—

 
936,946

 
9

 
29,325


—


—


—


—

 
29,334

Purchases and retirement of capital stock
—

 
—

 
(1,426,302
)
 
(14
)
 
(99,203
)

—


—


—


—

 
(99,217
)
Other comprehensive income (loss)(a)
—

 
—

 
—

 
—

 
—


(31,219
)

31,671


—


(1,125
)
 
(673
)
Net income (loss)
—

 
—

 
—

 
—

 
—


—


—


113,657


2,925

 
116,582

Balance, September 30, 2013
—

 
$
—

 
292,675,430

 
$
2,927

 
$
5,553,717

 
$
70,906

 
$
(132,245
)
 
$
(2,512,333
)
 
$
14,318

 
$
2,997,290


 
 
 
 
 
CCIC Stockholders
 
 
 
 
 
 
 
Redeemable Convertible Preferred Stock
 
Common Stock
 
 
 
AOCI
 
 
 
 
 
 
 
Shares
 
Amount
 
Shares
 
($.01 Par)
 
Additional
Paid-In
Capital
 
Foreign Currency Translation Adjustments
 
Derivative Instruments, net of tax
 
Accumulated
Deficit
 
Noncontrolling
Interest
 
Total
Balance, January 1, 2012
6,111,000

 
$
305,032

 
284,449,372

 
$
2,844

 
$
5,312,342

 
$
95,044

 
$
(212,040
)
 
$
(2,811,945
)
 
$
619

 
$
2,386,864

Stock-based compensation related activity, net of forfeitures
—

 
—

 
1,124,969

 
12

 
33,801

 
—


—


—


—

 
33,813

Purchases and retirement of capital stock
—

 
—


(699,177
)

(7
)

(35,977
)

—


—


—


—

 
(35,984
)
Conversion of redeemable preferred stock into common stock
(6,111,000
)
 
(305,180
)

8,285,905


83


305,097


—


—


—


—

 
305,180

Other comprehensive income (loss)(a)
—

 
—


—


—


—


7,822


37,541


—


(702
)
 
44,661

Dividends on preferred stock and amortization of issue costs
—

 
148


—


—


—


—


—


(2,629
)

—

 
(2,629
)
Disposition of noncontrolling interest
—

 
—


—


—


—


—


—


—


368

 
368

Net income (loss)
—

 
—


—


—


—


—


—


208,089


2,443

 
210,532

Balance, September 30, 2012
—

 
$
—

 
293,161,069

 
$
2,932

 
$
5,615,263

 
$
102,866

 
$
(174,499
)
 
$
(2,606,485
)
 
$
2,728

 
$
2,942,805

___________________________
(a)
See the statement of operations and other comprehensive income (loss) for the components of "other comprehensive income (loss)" and note 4 with respect to the reclassification adjustment.

See notes to condensed consolidated financial statements.


6

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited
(Tabular dollars in thousands, except per share amounts)

1.
General
The information contained in the following notes to the consolidated financial statements is condensed from that which would appear in the annual consolidated financial statements; accordingly, the consolidated financial statements included herein should be reviewed in conjunction with the consolidated financial statements for the fiscal year ended December 31, 2012, and related notes thereto, included in the 2012 Form 10-K filed by Crown Castle International Corp. ("CCIC") with the SEC. All references to the "Company" include CCIC and its subsidiary companies unless otherwise indicated or the context indicates otherwise.
The Company owns, operates and leases shared wireless infrastructure, including: (1) towers, (2) DAS, a type of small cell network, and (3) third party land interests. The Company conducts operations through subsidiaries of CCOC, including (1) certain subsidiaries which operate wireless infrastructure portfolios in the United States, including Puerto Rico ("U.S." or "CCUSA") and (2) a 77.6% owned subsidiary that operates towers in Australia (referred to as "CCAL"). The Company's core business is providing access, including space or capacity, to (1) its approximately 31,600 towers (of which approximately 29,900 towers are in CCUSA and approximately 1,700 towers are in CCAL) and, to a lesser extent, to (2) its small cell networks, and (3) third party land interests, to wireless communication companies via long-term contracts in various forms. As further discussed in the 2012 Form 10-K, approximately 12,700 of the Company's towers are leased or operated under master leases and subleases. See also note 13 for a description of the Proposed AT&T Transaction (as defined below).
As part of CCUSA's efforts to provide comprehensive wireless infrastructure solutions, it offers certain network services relating to its wireless infrastructure, consisting of (1) customer equipment installation and subsequent augmentation (collectively, "installation services") and (2) the following additional site development services relating to existing and new antenna installations on its wireless infrastructure: site acquisition, architectural and engineering, zoning and permitting, other construction and network development related services.
Basis of Presentation
The condensed consolidated financial statements included herein are unaudited; however, they include all adjustments (consisting only of normal recurring adjustments) which, in the opinion of management, are necessary to fairly state the consolidated financial position of the Company at September 30, 2013, and the consolidated results of operations and the consolidated cash flows for the nine months ended September 30, 2013 and 2012. The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by GAAP. Accounting measurements at interim dates inherently involve greater reliance on estimates than at year end. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for the entire year.
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

2.
Summary of Significant Accounting Policies
The significant accounting policies used in the preparation of the Company's consolidated financial statements are disclosed in the Company's 2012 Form 10-K.
New Accounting Pronouncements
No accounting pronouncements adopted during the nine months ended September 30, 2013 had a material impact on the Company's consolidated financial statements. No new accounting pronouncements issued during the nine months ended September 30, 2013 but not yet adopted are expected to have a material impact on the Company's consolidated financial statements.


7
CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in thousands, except per share amounts)


3.
Acquisitions
NextG Networks Acquisition
During the second quarter of 2013, the Company finalized the purchase price allocation for the NextG Acquisition. The final purchase price allocation is approximately the same as the preliminary purchase price allocation disclosed in the Company's 2012 Form 10-K.
T-Mobile Acquisition
In September 2012, the Company entered into a definitive agreement with T-Mobile to acquire the exclusive rights to lease, operate or otherwise acquire approximately 7,100 T-Mobile towers for approximately $2.5 billion. On November 30, 2012, the Company closed on the T-Mobile Acquisition. Upon closing, the Company obtained the exclusive right to lease and operate the T-Mobile towers (that are otherwise not owned by the Company). See the 2012 Form 10-K for further discussion of the terms of the T-Mobile lease including the purchase option. The Company utilized cash on hand, inclusive of the proceeds from the 5.25% Senior Notes, and borrowings from the 2012 Revolver to fund the T-Mobile Acquisition.
The purchase price and the purchase price allocation for the T-Mobile Acquisition is not finalized as of September 30, 2013. As such, the preliminary purchase price allocation presented below is based upon a preliminary valuation which is subject to change as the Company obtains additional information, including with respect to fixed assets, intangible assets, deferred taxes and certain liabilities. The principal changes in the preliminary purchase price allocation between December 31, 2012 and September 30, 2013 relate to (1) a $37.8 million increase in property and equipment, (2) a $45.0 million increase to the above-market lease deferred credit and (3) a corresponding increase in goodwill. The effect of the change in the preliminary purchase price allocation on the Company's Statement of Operations and Comprehensive Income (Loss) is immaterial to the periods presented. The preliminary purchase price allocation for the T-Mobile Acquisition, as of September 30, 2013, is shown below.
 
Preliminary Purchase Price Allocation
 
Presented September 30, 2013
Current assets
$
17,854

Property and equipment
1,497,204

Goodwill(a)
432,148

Other intangible assets, net
407,000

Deferred income tax assets
207,929

Below-market tenant leases and other non-current liabilities(b)
(76,349
)
Net assets acquired
$
2,485,786

    
(a)
The preliminary purchase price allocation for the T-Mobile Acquisition resulted in the recognition of goodwill at CCUSA primarily because of the anticipated growth opportunities in the tower portfolio. $371.3 million of the goodwill balance recorded is not expected to be deductible for tax purposes.
(b)
Inclusive of above-market leases for land interests under the Company's towers.
Unaudited Pro Forma Operating Results
The unaudited pro forma condensed consolidated results of operations combine the historical results of the Company, along with the historical results of the WCP Acquisition, NextG Acquisition and T-Mobile Acquisition (collectively, "2012 Acquisitions") for the period presented below. The following table presents the unaudited pro forma condensed consolidated results of operations of the Company for the period presented as if each acquisition was completed as of January 1, 2011. The unaudited pro forma amounts are presented for illustrative purposes only and are not necessarily indicative of future consolidated results of operations.
 
Nine Months Ended September 30, 2012
 
Net revenues
$
1,997,824

(a) 
Net income (loss)
$
197,262

(b)(c) 
Basic net income (loss) attributable to CCIC common stockholders, after deduction of dividends on preferred stock, per common share
$
0.67

 
Diluted net income (loss) attributable to CCIC common stockholders, after deduction of dividends on preferred stock, per common share
$
0.66

 
    
(a)
Amounts are inclusive of pro forma adjustments to increase net revenues of $197.2 million that we expect to recognize related to the T-Mobile towers, inclusive of T-Mobile's contracted lease of space on the towers acquired in the T-Mobile Acquisition.

8
CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in thousands, except per share amounts)


(b)
Amounts are inclusive of pro forma adjustments to increase depreciation and amortization of $107.5 million related to property and equipment and intangibles recorded as a result of the combined effect of the 2012 Acquisitions.
(c)
The pro forma adjustments are tax effected using the federal statutory rate and no adjustment was made with respect to the Company's reversal of valuation allowance.
See also note 13 for a description of the Proposed AT&T Transaction.

4.
Debt and Other Obligations
 
Original
Issue Date
 
Contractual
Maturity Date
 
Outstanding
Balance as of
 September 30, 2013
 
Outstanding
Balance as of
December 31, 2012
 
Stated Interest
Rate as of
September 30, 2013(a)
 
Bank debt - variable rate:
 
 
 
 
 
 
 
 
 
 
2012 Revolver
Jan. 2012
 
Jan. 2017
(b) 
255,000

(b) 
1,253,000

 
2.7
%
(c) 
Tranche A Term Loans
Jan. 2012
 
Jan. 2017
 
462,500

 
481,250

 
2.7
%
(c) 
Tranche B Term Loans(d)
Jan. 2012
 
Jan. 2019
 
2,370,100

 
1,584,000

 
3.3
%
(d) 
Total bank debt
 
 
 
 
3,087,600

 
3,318,250

 
 
 
Securitized debt - fixed rate:
 
 
 
 
 
 
 
 
 
 
January 2010 Tower Revenue Notes
Jan. 2010
 
2035 - 2040
(e) 
1,900,000

 
1,900,000

 
5.8
%
(e) 
August 2010 Tower Revenue Notes
Aug. 2010
 
2035 - 2040
(e) 
1,550,000

 
1,550,000

 
4.5
%
(e) 
2009 Securitized Notes
July 2009
 
2019/2029
(f) 
184,474

 
198,463

 
7.3
%
 
WCP Securitized Notes
Jan. 2010
 
Nov. 2040
(g) 
291,514

(g) 
307,739

 
5.6
%
 
Total securitized debt
 
 
 
 
3,925,988

 
3,956,202

 
 
 
Bonds - fixed rate:
 
 
 
 
 
 
 
 
 
 
9% Senior Notes
Jan. 2009
 
Jan. 2015
 
—

 
304,718

 
N/A

 
7.75% Secured Notes
Apr. 2009
 
May 2017
 
—

 
291,394

 
N/A

 
7.125% Senior Notes
Oct. 2009
 
Nov. 2019
 
498,275

 
498,110

 
7.1
%
 
5.25% Senior Notes
Oct. 2012
 
Jan. 2023
 
1,649,970

 
1,650,000

 
5.3
%
 
2012 Senior Notes
Dec. 2012
 
2017/2023
(h) 
1,500,000

 
1,500,000

 
3.4
%
 
Total bonds
 
 
 
 
3,648,245

 
4,244,222

 
 
 
Other:
 
 
 
 
 
 
 
 
 
 
Capital leases and other obligations
Various
 
Various
 
113,621

 
92,568

 
Various

 
Total debt and other obligations
 
 
 
 
10,775,454

 
11,611,242

 
 
 
Less: current maturities and short-term debt and other current obligations
 
 
 
 
115,378

 
688,056

 
 
 
Non-current portion of long-term debt and other long-term obligations
 
 
 
 
$
10,660,076

 
$
10,923,186

 
 
 
________________
(a)
Represents the weighted-average stated interest rate.
(b)
As of September 30, 2013, the undrawn availability under the $1.5 billion 2012 Revolver is $1.2 billion.
(c)
The 2012 Revolver and the Tranche A Term Loans bear interest at a per annum rate equal to LIBOR plus 2.0% to 2.75%, based on CCOC's total net leverage ratio.
(d)
The Tranche B Term Loans, including the Incremental Loans (defined below), bear interest at a per annum rate equal to LIBOR plus 2.25% to 2.5% (with LIBOR subject to a floor of 0.75% per annum), based on CCOC's total net leverage ratio. In April 2013, the Company refinanced the then outstanding Tranche B Term Loans with new loans pursuant to our existing credit agreement in an aggregate principal amount of $1.6 billion. In August 2013, the Company borrowed $800.0 million of incremental tranche B loans ("Incremental Loans"). The proceeds of the Incremental Loans were used to repay a portion of the 2012 Revolver.
(e)
If the respective series of the January 2010 Tower Revenue Notes and August 2010 Tower Revenue Notes are not paid in full on or prior to 2015, 2017 and 2020, as applicable, 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 class of the 2010 Tower Revenue Notes, and additional interest (of approximately 5% per annum) will accrue on the respective 2010 Tower Revenue Notes. The January 2010 Tower Revenue Notes consist of three series of notes with principal amounts of $300.0 million, $350.0 million and $1.3 billion, having anticipated repayment dates in 2015, 2017 and 2020, respectively. The August 2010 Tower Revenue Notes consist of three series of notes with principal amounts of $250.0 million, $300.0 million and $1.0 billion, having anticipated repayment dates in 2015, 2017 and 2020, respectively.
(f)
The 2009 Securitized Notes consist of $114.5 million of principal as of September 30, 2013 that amortizes through 2019, and $70.0 million of principal as of September 30, 2013 that amortizes during the period beginning in 2019 and ending in 2029.
(g)
The anticipated repayment date is 2015 for each class of the WCP Securitized Notes. If the WCP Securitized Notes are not repaid in full by their anticipated repayment dates, the applicable interest rate increases by an additional approximately 5% per annum. If the WCP Securitized Notes are not repaid in full by their rapid amortization date of 2017, monthly principal payments commence using the excess cash flows of the issuers of the WCP Securitized Notes.

9
CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in thousands, except per share amounts)


(h)
The 2012 Secured Notes consist of $500 million aggregate principal amount of 2.381% secured notes due 2017 and $1.0 billion aggregate principal amount of 3.849% secured notes due 2023.
Contractual Maturities
The following are the scheduled contractual maturities of the total debt and other long-term obligations outstanding at September 30, 2013. These maturities reflect contractual maturity dates and do not consider the principal payments that will commence following the anticipated repayment dates on the Tower Revenue Notes and the rapid amortization date on the WCP Securitized Notes.
 
Three Months Ended December 31,
 
Years Ending December 31,
 
 
 
 
 
Unamortized Adjustments, Net
 
Total Debt and Other Obligations Outstanding
 
2013
 
2014
 
2015
 
2016
 
2017
 
Thereafter
 
Total Cash Obligations
 
 
Scheduled contractual maturities
$
26,632

 
$
113,545

 
$
125,405

 
$
123,897

 
$
1,146,074

 
$
9,232,987

 
$
10,768,540

 
$
6,914

 
$
10,775,454

Purchases and Redemptions of Long-Term Debt
The following is a summary of purchases and redemptions of long-term debt during the nine months ended September 30, 2013.
 
Nine Months Ended September 30, 2013
 
Principal Amount
 
Cash Paid(a)
 
Gains (Losses)(c)
9% Senior Notes
314,170

 
332,045

 
(17,894
)
7.75% Secured Notes(b)
294,362

 
312,465

 
(18,103
)
5.25% Senior Notes
30

 
30

 
—

Tranche B Term Loans
30,941

 
30,941

 
(490
)
Total
$
639,503

 
$
675,481

 
$
(36,487
)
________________
(a)
Exclusive of accrued interest.
(b)
The redemption of the 7.75% Secured Notes was funded by the release of restricted cash.
(c)
The losses predominantly relate to cash losses, including with respect to make whole payments.
Interest Expense and Amortization of Deferred Financing Costs
The components of "interest expense and amortization of deferred financing costs" are as follows:
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2013
 
2012
 
2013
 
2012
Interest expense on debt obligations
$
121,246

 
$
119,460

 
$
368,400

 
$
353,702

Amortization of deferred financing costs
5,366

 
5,293

 
19,426

 
15,383

Amortization of adjustments on long-term debt
(971
)
 
3,235

 
9,500

 
9,959

Amortization of interest rate swaps(a)
16,222

 
16,300

 
48,726

 
48,957

Other, net of capitalized interest
153

 
661

 
589

 
(640
)
Total
$
142,016

 
$
144,949

 
$
446,641

 
$
427,361

    
(a)
Amounts reclassified from accumulated other comprehensive income (loss).


10
CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in thousands, except per share amounts)


5.
Income Taxes
For the nine months ended September 30, 2013, the Company's effective rate differed from the federal statutory rate predominately due to state taxes of $21.7 million, including the impact of certain subsidiaries without state income tax filing requirements incurring taxable losses for which no state benefit could be recorded.  As further discussed in our 2012 Form 10-K, for the nine months ended September 30, 2012, the Company's effective tax rate differed from the federal statutory rate predominately due to its reversal of a total of $70.1 million of federal and $20.0 million of state valuation allowances to the benefit (provision) for income taxes.
In September 2013, the Company announced that it was commencing the steps necessary to reorganize to qualify as a REIT for U.S. federal income tax purposes. The Company expects to elect to be taxed as a REIT beginning with the taxable year commencing January 1, 2014.
After conversion into a REIT, the Company generally will not be subject to U.S. federal corporate income tax to the extent it distributes its net taxable income to its stockholders. As a REIT, the Company will also subject to a number of other organizational and operational requirements. In connection with the Company's anticipated conversion from a taxable C corporation into a REIT, the Company would expect to de-recognize its previously recorded U.S. federal and state deferred tax assets and liabilities related to the entities included in the REIT, because the expected recovery or settlement of the related assets and liabilities would not result in a taxable or deductible amount in the future. In such cases, the Company would continue to record deferred taxes for certain of its subsidiaries ("TRSs"), including its foreign subsidiaries and other taxable REIT subsidiaries. As a result of the expected de-recognition of the aforementioned deferred tax assets and liabilities related to the entities included in the REIT, the Company would also then expect to record a corresponding net non-cash income tax charge of approximately $130 million to $160 million in a future period in conjunction with the anticipated REIT conversion. The de-recognition of the deferred tax assets and liabilities would be recorded if and when the Company has completed all necessary actions to qualify as a REIT and has obtained final approval from the Company's board of directors.

6.
Fair Value Disclosures
 
Level in Fair Value Hierarchy
 
September 30, 2013
 
December 31, 2012
 
 
Carrying
 Amount
 
Fair
Value
 
Carrying
 Amount
 
Fair
Value
Assets:
 
 
 
 
 
 
 
 
 
Cash and cash equivalents
1
 
$
218,649

 
$
218,649

 
$
441,364

 
$
441,364

Restricted cash, current and non-current
1
 
162,699

 
162,699

 
580,938

 
580,938

Liabilities:
 
 
 
 
 
 
 
 
 
Long-term debt and other obligations
2
 
10,775,454

 
10,881,293

 
11,611,242

 
12,438,032

The fair value of cash and cash equivalents and restricted cash approximate the carrying value. The Company determines fair value of its debt securities based on indicative, non-binding quotes from brokers. Quotes from brokers require judgment and are based on the brokers' interpretation of market information including implied credit spreads for similar borrowings on recent trades or bid/ask prices or quotes from active markets if available. There were no changes since December 31, 2012 in the Company's valuation techniques used to measure fair values.


11
CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in thousands, except per share amounts)


7.
Per Share Information
Basic net income (loss) attributable to CCIC common stockholders, after deduction of dividends on preferred stock, per common share excludes dilution and is computed by dividing net income (loss) attributable to CCIC stockholders after deduction of dividends on preferred stock, by the weighted-average number of common shares outstanding during the period. Diluted net income (loss) attributable to CCIC common stockholders, after deduction of dividends on preferred stock, per common share is computed by dividing net income (loss) attributable to CCIC stockholders, after deduction of dividends on preferred stock, by the weighted-average number of common shares outstanding during the period plus any potential dilutive common share equivalents as determined under the if-converted method. The Company's restricted stock awards are considered participating securities and may be included in the computation pursuant to the two-class method. However, the Company does not present the two-class method when there is no difference between the per share amount under the two-class method and the treasury stock method.
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
2013
 
2012
 
2013
 
2012
Net income (loss) attributable to CCIC stockholders
$
45,836

 
$
42,045

 
$
113,657

 
$
208,089

Dividends on preferred stock
—

 
—

 
—

 
(2,629
)
Net income (loss) attributable to CCIC common stockholders after deduction of dividends on preferred stock for basic and diluted computations
$
45,836

 
$
42,045

 
$
113,657

 
$
205,460

Weighted-average number of common shares outstanding (in thousands):
 
 
 
 
 
 
 
Basic weighted-average number of common stock outstanding
290,372

 
290,762

 
290,900

 
288,775

Effect of assumed dilution from potential common shares relating to stock options and restricted stock awards
1,006

 
1,336

 
1,143

 
1,752

Diluted weighted-average number of common shares outstanding
291,378

 
292,098

 
292,043

 
290,527

Net income (loss) attributable to CCIC common stockholders after deduction of dividends on preferred stock, per common share:
 
 
 
 
 
 
 
Basic
$
0.16

 
$
0.14

 
$
0.39

 
$
0.71

Diluted
$
0.16

 
$
0.14

 
$
0.39

 
$
0.71

For the three and nine months ended September 30, 2013, 0.6 million restricted stock awards were excluded from the dilutive common shares because certain stock price hurdles would not have been achieved assuming that September 30, 2013 was the end of the contingency period.
See also note 13 for a description of our October Equity Financings (as defined below) as well as the announcement of our expectation to initiate a dividend on shares of our Common Stock (as defined below), subject to the successful completion and financing of the Proposed AT&T Transaction.

8.
Commitments and Contingencies
The Company is involved in various claims, lawsuits and proceedings arising in the ordinary course of business. While there are uncertainties inherent in the ultimate outcome of such matters and it is impossible to presently determine the ultimate costs or losses that may be incurred, if any, management believes the resolution of such uncertainties and the incurrence of such costs should not have a material adverse effect on the Company's consolidated financial position or results of operations. Additionally, the Company and certain of its subsidiaries are contingently liable for commitments and performance guarantees arising in the ordinary course of business.
See also note 13 for a description of the Proposed AT&T Transaction.

9.
Equity
Purchases of the Company's Common Stock
For the nine months ended September 30, 2013, the Company purchased 1.4 million shares of Common Stock utilizing $99.2 million in cash.
See also note 13 for a description of our October Equity Financings, as well as our announcement of an expected dividend on shares of our Common Stock.


12
CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in thousands, except per share amounts)


10.
Operating Segments
The Company's reportable operating segments are (1) CCUSA, primarily consisting of the Company's U.S. operations and (2) CCAL, the Company's Australian operations. Financial results for the Company are reported to management and the board of directors in this manner.
The measurement of profit or loss currently used by management to evaluate the results of operations for the Company and its operating segments is earnings before interest, taxes, depreciation, amortization and accretion, as adjusted ("Adjusted EBITDA"). The Company defines 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, gains (losses) on retirement of long-term obligations, net gain (loss) on interest rate swaps, impairment of available-for-sale securities, interest income, other income (expense), benefit (provision) for income taxes, cumulative effect of change in accounting principle, income (loss) from discontinued operations and stock-based compensation expense. Adjusted EBITDA is not intended as an alternative measure of operating results or cash flow from operations (as determined in accordance with GAAP), and the Company's measure of Adjusted EBITDA may not be comparable to similarly titled measures of other companies. There are no significant revenues resulting from transactions between the Company's operating segments. Inter-company borrowings and related interest between segments are eliminated to reconcile segment results and assets to the consolidated basis.

 
Three Months Ended September 30, 2013
 
Three Months Ended September 30, 2012
 
CCUSA
 
CCAL
 
Eliminations
 
Consolidated
Total
 
CCUSA
 
CCAL
 
Eliminations
 
Consolidated
Total
Net revenues:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Site rental
$
589,415

 
$
31,351

 
$
—

 
$
620,766

 
$
507,247

 
$
31,514

 
$
—

 
$
538,761

Network services and other
122,063

 
6,148

 
—

 
128,211

 
78,287

 
4,289

 
—

 
82,576

Net revenues
711,478

 
37,499

 
—

 
748,977

 
585,534

 
35,803

 
—

 
621,337

Operating expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs of operations:(a)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Site rental
172,791

 
9,175

 
—

 
181,966

 
126,059

 
9,255

 
—

 
135,314

Network services and other
77,929

 
4,069

 
—

 
81,998

 
46,592

 
3,437

 
—

 
50,029

General and administrative
52,312

 
6,192

 
—

 
58,504

 
50,461

 
5,401

 
—

 
55,862

Asset write-down charges
3,022

 
871

 
—

 
3,893

 
1,518

 
42

 
—

 
1,560

Acquisition and integration costs
4,243

 
126

 
—

 
4,369

 
2,937

 
—

 
—

 
2,937

Depreciation, amortization and accretion
186,521

 
8,887

 
—

 
195,408

 
147,186

 
7,681

 
—

 
154,867

Total operating expenses
496,818

 
29,320

 
—

 
526,138

 
374,753

 
25,816

 
—

 
400,569

Operating income (loss)
214,660

 
8,179

 
—

 
222,839

 
210,781

 
9,987

 
—

 
220,768

Interest expense and amortization of deferred financing costs
(142,016
)
 
(3,949
)
 
3,949

 
(142,016
)
 
(144,949
)
 
(4,478
)
 
4,478

 
(144,949
)
Gains (losses) on retirement of long-term obligations
(1
)
 
—

 
—

 
(1
)
 
—

 
—

 
—

 
—

Interest income
144

 
92

 
—

 
236

 
210

 
81

 
—

 
291

Other income (expense)
3,295

 
23

 
(3,949
)
 
(631
)
 
3,825

 
21

 
(4,478
)
 
(632
)
Benefit (provision) for income taxes
(32,538
)
 
(1,421
)
 
—

 
(33,959
)
 
(31,864
)
 
(436
)
 
—

 
(32,300
)
Net income (loss)
43,544

 
2,924

 
—

 
46,468

 
38,003

 
5,175

 
—

 
43,178

Less: Net income (loss) attributable to the noncontrolling interest
—

 
632

 
—

 
632

 
—

 
1,133

 
—

 
1,133

Net income (loss) attributable to CCIC stockholders
$
43,544

 
$
2,292

 
$
—

 
$
45,836

 
$
38,003

 
$
4,042

 
$
—

 
$
42,045

Capital expenditures
$
125,941

 
$
4,722

 
$
—

 
$
130,663

 
$
117,830

 
$
5,860

 
$
—

 
$
123,690

________________
(a)
Exclusive of depreciation, amortization and accretion shown separately.

13
CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS-Unaudited (Continued)
(Tabular dollars in thousands, except per share amounts)


 
Nine Months Ended September 30, 2013
 
Nine Months Ended September 30, 2012
 
CCUSA
 
CCAL
 
Eliminations
 
Consolidated
Total
 
CCUSA
 
CCAL
 
Eliminations
 
Consolidated
Total
Net revenues:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Site rental
$
1,754,266

 
$
98,764

 
$
—

 
$
1,853,030

 
$
1,463,126

 
$
90,752

 
$
—

 
$
1,553,878

Network services and other
352,982

 
17,953

 
—

 
370,935

 
187,304

 
17,411

 
—

 
204,715

Net revenues
2,107,248

 
116,717

 
—

 
2,223,965

 
1,650,430

 
108,163

 
—

 
1,758,593

Operating expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Costs of operations:(a)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Site rental
509,617

 
28,970

 
—

 
538,587

 
363,066

 
26,690

 
—

 
389,756

Network services and other
215,812

 
13,762

 
—

 
229,574

 
110,240

 
11,572

 
—

 
121,812

General and administrative
154,098

 
17,441

 
—

 
171,539

 
135,655

 
18,286

 
—

 
153,941

Asset write-down charges
9,633

 
1,072

 
—

 
10,705

 
8,197

 
53

 
—

 
8,250

Acquisition and integration costs
12,875

 
311

 
—

 
13,186

 
12,058

 
54

 
—

 
12,112

Depreciation, amortization and accretion
548,951

 
23,567

 
—

 
572,518

 
423,620

 
23,129

 
—

 
446,749

Total operating expenses
1,450,986

 
85,123

 
—

 
1,536,109

 
1,052,836

 
79,784

 
—

 
1,132,620

Operating income (loss)
656,262

 
31,594

 
—

 
687,856

 
597,594

 
28,379

 
—

 
625,973

Interest expense and amortization of deferred financing costs
(446,641
)
 
(12,710
)
 
12,710

 
(446,641
)
 
(427,349
)
 
(14,815
)
 
14,803

 
(427,361
)
Gains (losses) on retirement of long-term obligations
(36,487
)
 
—

 
—

 
(36,487
)
 
(14,586
)
 
—

 
—

 
(14,586
)
Interest income
592

 
269

 
—

 
861

 
665

 
362

 
—

 
1,027

Other income (expense)
11,922

 
35

 
(12,710
)
 
(753
)
 
10,869

 
(24
)
 
(14,803
)
 
(3,958
)
Benefit (provision) for income taxes
(82,455
)
 
(5,799
)
 
—

 
(88,254
)
 
30,883

 
(1,446
)
 
—

 
29,437

Net income (loss)
103,193

 
13,389

 
—

 
116,582

 
198,076

 
12,456

 
—

 
210,532

Less: Net income (loss) attributable to the noncontrolling interest
—

 
2,925

 
—

 
2,925

 
(268
)
 
2,711

 
—

 
2,443

Net income (loss) attributable to CCIC stockholders
$
103,193

 
$
10,464

 
$
—

 
$
113,657

 
$
198,344

 
$
9,745

 
$
—