Tower owner and operator SpectraSite Inc. this week released fairly solid third-quarter 2003 financial results.
SpectraSite reported total revenues of $83.9 million, up from $79.3 million for the third quarter of 2002. Revenues from site operations were $79.5 million, up from $72 million in the year-ago quarter, while revenues from broadcast services were $4.3 million, down from $7.3 million last year. Adjusted EBITDA (defined as net income before depreciation; amortization; and accretion, interest and income tax expense) was $41.9 million for the quarter, up 21.5 percent from $34.5 million in the third quarter of 2002. Free cash flow was $30.4 million.
At the end of the quarter, SpectraSite owned or operated 7,509 towers and in-building sites, which represent an increasing area of focus for the tower company. Same tower revenue growth was up 14.1 percent from the third quarter of 2002.
Despite the positive results, Raymond James & Associates Inc. lowered its rating on the company from strong buy to outperform based on its valuation, although “operationally, we believe the company continues to execute at a high level,” the analyst firm said in its research note.
Looking ahead to next year, SpectraSite expects full-year 2004 site leasing and licensing revenues to be between $336 million and $341 million and broadcast services revenues to be between $10 million and $12 million. The company’s 2004 financial guidance assumes no acquisitions, although the company will likely acquire towers in accordance with its agreement signed earlier this year to buy 600 towers from SBC. In fact, SpectraSite said it plans to acquire 100 towers from SBC per quarter next year to fulfill that agreement. The company so far has acquired 59 of those towers and plans to acquire 55 more in the fourth quarter of this year.
SpectraSite’s stock, which began trading this quarter on the New York Stock Exchange under the symbol SSI, was trading down about 5 percent at $36.86. Since it emerged from bankruptcy early this year, the company’s shares have traded highest among the publicly traded tower companies.
