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Crown Castle (CCI) Tops on Q4 FFO, Maintains '21 Guidance
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Crown Castle International Corp.’s (CCI - Free Report) fourth-quarter 2020 adjusted funds from operations (AFFO) per share of $2.33 surpassed the Zacks Consensus Estimate of $1.65. Moreover, the figure was 68.8% higher than the prior-year quarter figure of $1.38.
Net revenues of $1.49 billion improved 4.7% year over year in the reported quarter. However, the revenue figure missed the Zacks Consensus Estimate of 1.52 billion.
Growth in site-rental revenues aided the top-line performance. The company also maintained its outlook for 2021.
For 2020, it reported AFFO per share of $6.78, up 19% from $5.68 in the prior year. The company also beat the Zacks Consensus Estimate of $6.08. Total revenues of $5.8 billion grew 1.3% year over year.
Per management, “We expect our growth trend to continue with approximately 6% growth in Organic Contribution to Site Rental Revenue for our Towers segment in 2021, supporting the previously announced 11% increase in our dividend per share.”
Notably, in December 2020, T-Mobile US, Inc. canceled approximately 5,700 small cells contracted between Sprint Corporation and Crown Castle prior to the merger of the carriers. While the majority of the canceled small cells were not yet constructed, upon completion, it would result in site overlap as other T-Mobile small cells locations. The cancellation resulted in T-Mobile accelerating payment of all contractual rental obligations associated with 5,700 small cells and the payment of capital costs incurred to date. This, in turn, impacted Crown Castle’s fourth-quarter and 2020 results.
Nonetheless, along with the earnings release, the company announced signing a long-term lease with Verizon to rent out 15,000 new small cells over the coming four years. After installation, the small cell leases will have an initial term of 10 years.
Quarter in Detail
Site-rental revenues were $1.3 billion, up 4% year over year. $74 million in organic contribution to site rental revenues reflects 4.2% growth. Further, services and other revenues rose 12% year over year to $141 million.
Quarterly operating expenses flared up 12.2% year over year to $1.17 billion. Nonetheless, operating income surged 79.4% year over year to $680 million. Quarterly adjusted EBITDA of $1.18 billion marked a 44.3% year-over-year rise.
The company reported capital expenditure of $386 million for the fourth quarter. This included $365 million of discretionary capital expenditure and $21 million of sustaining capital expenditure.
Balance Sheet
Crown Castle exited fourth-quarter 2020 with cash and cash equivalents of $232 million, up from $196 million reported at the end of 2019.
Furthermore, for the three months ended Dec 31, 2020, the company generated $985 million of net cash from operating activities compared with $808 million reported in the year-ago period.
Also, debt and other long-term obligations aggregated $19.3 billion, up from $18.1 billion witnessed at the end of 2019.
Guidance
The company expects site-rental revenues of 5,532-$5,577 million. Adjusted EBITDA is projected at $3,584-$3,629 million. AFFO per share is anticipated to be $6.64-$6.74. The Zacks Consensus Estimate for the same is pegged at $6.70.
We now look forward to the earnings releases of other REITs like Welltower Inc. (WELL - Free Report) , Highwoods Properties (HIW - Free Report) and Healthpeak Properties . All three companies are slated to report fourth-quarter earnings on Feb 9.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Crown Castle (CCI) Tops on Q4 FFO, Maintains '21 Guidance
Crown Castle International Corp.’s (CCI - Free Report) fourth-quarter 2020 adjusted funds from operations (AFFO) per share of $2.33 surpassed the Zacks Consensus Estimate of $1.65. Moreover, the figure was 68.8% higher than the prior-year quarter figure of $1.38.
Net revenues of $1.49 billion improved 4.7% year over year in the reported quarter. However, the revenue figure missed the Zacks Consensus Estimate of 1.52 billion.
Growth in site-rental revenues aided the top-line performance. The company also maintained its outlook for 2021.
For 2020, it reported AFFO per share of $6.78, up 19% from $5.68 in the prior year. The company also beat the Zacks Consensus Estimate of $6.08. Total revenues of $5.8 billion grew 1.3% year over year.
Per management, “We expect our growth trend to continue with approximately 6% growth in Organic Contribution to Site Rental Revenue for our Towers segment in 2021, supporting the previously announced 11% increase in our dividend per share.”
Notably, in December 2020, T-Mobile US, Inc. canceled approximately 5,700 small cells contracted between Sprint Corporation and Crown Castle prior to the merger of the carriers. While the majority of the canceled small cells were not yet constructed, upon completion, it would result in site overlap as other T-Mobile small cells locations. The cancellation resulted in T-Mobile accelerating payment of all contractual rental obligations associated with 5,700 small cells and the payment of capital costs incurred to date. This, in turn, impacted Crown Castle’s fourth-quarter and 2020 results.
Nonetheless, along with the earnings release, the company announced signing a long-term lease with Verizon to rent out 15,000 new small cells over the coming four years. After installation, the small cell leases will have an initial term of 10 years.
Quarter in Detail
Site-rental revenues were $1.3 billion, up 4% year over year. $74 million in organic contribution to site rental revenues reflects 4.2% growth. Further, services and other revenues rose 12% year over year to $141 million.
Quarterly operating expenses flared up 12.2% year over year to $1.17 billion. Nonetheless, operating income surged 79.4% year over year to $680 million. Quarterly adjusted EBITDA of $1.18 billion marked a 44.3% year-over-year rise.
The company reported capital expenditure of $386 million for the fourth quarter. This included $365 million of discretionary capital expenditure and $21 million of sustaining capital expenditure.
Balance Sheet
Crown Castle exited fourth-quarter 2020 with cash and cash equivalents of $232 million, up from $196 million reported at the end of 2019.
Furthermore, for the three months ended Dec 31, 2020, the company generated $985 million of net cash from operating activities compared with $808 million reported in the year-ago period.
Also, debt and other long-term obligations aggregated $19.3 billion, up from $18.1 billion witnessed at the end of 2019.
Guidance
The company expects site-rental revenues of 5,532-$5,577 million. Adjusted EBITDA is projected at $3,584-$3,629 million. AFFO per share is anticipated to be $6.64-$6.74. The Zacks Consensus Estimate for the same is pegged at $6.70.
Crown Castle currently carries a Zacks Rank of 3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Crown Castle International Corporation Price, Consensus and EPS Surprise
Crown Castle International Corporation price-consensus-eps-surprise-chart | Crown Castle International Corporation Quote
We now look forward to the earnings releases of other REITs like Welltower Inc. (WELL - Free Report) , Highwoods Properties (HIW - Free Report) and Healthpeak Properties . All three companies are slated to report fourth-quarter earnings on Feb 9.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
Looking for Stocks with Skyrocketing Upside?
Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.
Ignited by referendums and legislation, this industry is expected to blast from an already robust $17.7 billion in 2019 to a staggering $73.6 billion by 2027. Early investors stand to make a killing, but you have to be ready to act and know just where to look.
See the pot stocks we're targeting >>