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Crown Castle International (CCI) Beats on Earnings in Q4
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Crown Castle International Corp. (CCI - Free Report) , a leading wireless communication tower operator in the U.S. reported impressive financial results for the fourth quarter of 2016 (ended Dec 31, 2016) wherein both the top line and the bottom line surpassed the Zacks Consensus Estimate.
The spectacular performance can be attributed to the company’s extensive tower portfolio, increased demand for infrastructure, strong business outlook, healthy leasing activity, continued acquisition of towers and growing demand for mobile broadband. Wireless services are rapidly gaining ground courtesy of additional features and capabilities. Buyout of wireless towers also bodes well. Much of the infrastructure and upgrades require effective site management of cell towers and equipment. Crown Castle effectively addresses this opportunity as over 90% of its quarterly revenues come from wireless service providers like Verizon Communications Inc. (VZ - Free Report) , AT&T Inc. (T - Free Report) and T-Mobile US Inc. (TMUS - Free Report) .
The company reported quarterly earnings per share of $1.15, beating the Zacks Consensus Estimate of $1.11. However, GAAP net income fell 11.6% year over year to $124.7 million.
Revenue
Net revenue in the quarter increased 9.15% year over year to $1,032 million, beating the Zacks Consensus Estimate of $988 million. Site Rental Segment quarterly revenues were $817.3 million, up 4.1% year over year. Network Services Segment quarterly revenues were $215 million, up 33.9% year over year.
Operating Metrics
Quarterly operating income came in at $262 million compared with $230 in the year-ago quarter. Total operating expenses rose to $770.4 million from $716.1 million at the end of 2015. Operating margin in the reported quarter was 25.4% compared with 24.3% in the year-ago quarter. Quarterly adjusted EBITDA was approximately $574.6 million, representing a year-over-year increase of 6.5%
Cash Flow
During the fourth quarter of 2016, funds flow from operations (FFO) totaled $386.9 million compared with $410.3 million in the prior-year quarter. Quarterly adjusted funds flow from operations (AFFO) was $406.4 million compared with $372.2 million in the year-ago quarter.
Balance Sheet
At the end of Dec 2016, Crown Castle had cash and cash equivalents of approximately $567.6 million on its balance sheet compared with $178.8 million at the end of 2015. At fourth-quarter end, debt and other long-term obligations totaled approximately $12,069.4 million, up from $12,043.7 million at the end of 2015.
Cash Dividend Payment
During the reported quarter, Crown Castle’s efforts to reward its shareholders with quarterly cash dividends were impressive. Crown Castle paid a quarterly cash dividend of 95 cents per common share on Dec 30, 2016 to common stockholders of records at the closure of business on Dec 16, 2016.
Crown Castle International Corporation Price, Consensus and EPS Surprise
For the first quarter of 2017, Crown Castle expects Site Rental revenues in the range of $851 million to $856 million. Site Rental cost of operation is projected in the band of $263 million to $268 million. Adjusted EBITDA is anticipated between $575 million and $580 million. Site Rental gross margin is expected in the band of $586–$591 million. Interest expense (inclusive of amortization) is estimated at $132–$137 million. Meanwhile, FFO is anticipated in the $395–$400 million band. AFFO is projected in the $440–$445 million range and net income is projected at $88–$108 million.
Full-Year 2017 Outlook
Crown Castle has raised its outlook for 2017. The company now expects Site Rental revenues in the range of $3,468–$3,498 million. Site Rental cost of operation is projected in the $1,063–$1,093 million band. Site Rental gross margin is expected between $2,391 million and $2,421 million. Adjusted EBITDA is anticipated between $2,358 million and $2,388 million. Interest expense (inclusive of amortization) is estimated in the $540–$570 million range. FFO is projected at $1,616–$1,646 million. AFFO is expected between $1,801 million and $1,831 million. Net income is anticipated between $360 million and $410 million.
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Crown Castle International (CCI) Beats on Earnings in Q4
Crown Castle International Corp. (CCI - Free Report) , a leading wireless communication tower operator in the U.S. reported impressive financial results for the fourth quarter of 2016 (ended Dec 31, 2016) wherein both the top line and the bottom line surpassed the Zacks Consensus Estimate.
The spectacular performance can be attributed to the company’s extensive tower portfolio, increased demand for infrastructure, strong business outlook, healthy leasing activity, continued acquisition of towers and growing demand for mobile broadband. Wireless services are rapidly gaining ground courtesy of additional features and capabilities. Buyout of wireless towers also bodes well. Much of the infrastructure and upgrades require effective site management of cell towers and equipment. Crown Castle effectively addresses this opportunity as over 90% of its quarterly revenues come from wireless service providers like Verizon Communications Inc. (VZ - Free Report) , AT&T Inc. (T - Free Report) and T-Mobile US Inc. (TMUS - Free Report) .
Hence the company currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Net Income
The company reported quarterly earnings per share of $1.15, beating the Zacks Consensus Estimate of $1.11. However, GAAP net income fell 11.6% year over year to $124.7 million.
Revenue
Net revenue in the quarter increased 9.15% year over year to $1,032 million, beating the Zacks Consensus Estimate of $988 million. Site Rental Segment quarterly revenues were $817.3 million, up 4.1% year over year. Network Services Segment quarterly revenues were $215 million, up 33.9% year over year.
Operating Metrics
Quarterly operating income came in at $262 million compared with $230 in the year-ago quarter. Total operating expenses rose to $770.4 million from $716.1 million at the end of 2015. Operating margin in the reported quarter was 25.4% compared with 24.3% in the year-ago quarter. Quarterly adjusted EBITDA was approximately $574.6 million, representing a year-over-year increase of 6.5%
Cash Flow
During the fourth quarter of 2016, funds flow from operations (FFO) totaled $386.9 million compared with $410.3 million in the prior-year quarter. Quarterly adjusted funds flow from operations (AFFO) was $406.4 million compared with $372.2 million in the year-ago quarter.
Balance Sheet
At the end of Dec 2016, Crown Castle had cash and cash equivalents of approximately $567.6 million on its balance sheet compared with $178.8 million at the end of 2015. At fourth-quarter end, debt and other long-term obligations totaled approximately $12,069.4 million, up from $12,043.7 million at the end of 2015.
Cash Dividend Payment
During the reported quarter, Crown Castle’s efforts to reward its shareholders with quarterly cash dividends were impressive. Crown Castle paid a quarterly cash dividend of 95 cents per common share on Dec 30, 2016 to common stockholders of records at the closure of business on Dec 16, 2016.
Crown Castle International Corporation Price, Consensus and EPS Surprise
Crown Castle International Corporation Price, Consensus and EPS Surprise | Crown Castle International Corporation Quote
First-Quarter 2017 Outlook
For the first quarter of 2017, Crown Castle expects Site Rental revenues in the range of $851 million to $856 million. Site Rental cost of operation is projected in the band of $263 million to $268 million. Adjusted EBITDA is anticipated between $575 million and $580 million. Site Rental gross margin is expected in the band of $586–$591 million. Interest expense (inclusive of amortization) is estimated at $132–$137 million. Meanwhile, FFO is anticipated in the $395–$400 million band. AFFO is projected in the $440–$445 million range and net income is projected at $88–$108 million.
Full-Year 2017 Outlook
Crown Castle has raised its outlook for 2017. The company now expects Site Rental revenues in the range of $3,468–$3,498 million. Site Rental cost of operation is projected in the $1,063–$1,093 million band. Site Rental gross margin is expected between $2,391 million and $2,421 million. Adjusted EBITDA is anticipated between $2,358 million and $2,388 million. Interest expense (inclusive of amortization) is estimated in the $540–$570 million range. FFO is projected at $1,616–$1,646 million. AFFO is expected between $1,801 million and $1,831 million. Net income is anticipated between $360 million and $410 million.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>