American Tower Corp. and Crown Castle International Corp. released solid fourth-quarter 2003 financial results, as expected.
American Tower’s revenues totaled $191.5 million, up from $177.4 million for the fourth quarter of 2002. Net loss decreased to $51.2 million, or 23 cents per share, compared with $52.4 million, or 27 cents per share, in the year-ago quarter. For the full year, revenues stood at $715.1 million, up from $675.1 million for the full-year 2002. Net loss for 2003 was $303.4 million, improved from $1.14 billion, or $5.84 per share, for 2002.
Adjusted EBITDA increased 17 percent from fourth-quarter ’02 to $104.9 million, and increased 25 percent for the full year to $390.8 million. The company said free cash flow, which it defines as “adjusted EBITDA less interest expense and capital expenditures incurred, excluding acquisitions and divestitures,” was $20.5 million for the fourth quarter and $61.5 million for the year.
The company owned approximately 13,300 towers at the end of 2003. During the final quarter, the company sold non-core assets valued at $33.7 million, including 206 non-strategic towers, as part of its continued strategy of divesting non-core assets. The company said it may see $10.5 million in proceeds from additional asset sales during this quarter.
American Tower forecasts total revenue will increase throughout 2004, while net losses will decrease steadily.
Shares of American Tower were trading at $11.81 at the close of the week.
Crown Castle’s results exceeded analyst expectations, which RBC Capital Markets noted was due to “a combination of strong site leasing demand and foreign currency gains.” Strong growth in the company’s substantial U.K. operations, likely due to accelerated lease-up on 3G sites, specifically contributed to the strong results, analysts from Bear Stearns & Co. Inc. noted.
Crown reported revenue for the fourth quarter of $214 million, up from $179.3 million during the same quarter in 2002. Revenue for the year totaled $786.8 million, also improved from 2002’s $677.8 million.
Net loss, however, was well up, partially due to losses from the retirement of debt and preferred securities. Including $122.8 million put toward paying off those debts, net loss for the fourth quarter was $171.4 million, compared with net loss of $34.9 million for the previous year’s fourth quarter, which Crown said included $49.1 million of gains from the retirement of debt. Per-share net loss for the fourth quarter was 83 cents, compared with 2 cents last year. Net loss for the full year was $420.9 million, compared with $272.5 million for 2002.
Free cash flow, which Crown defines as “net cash from operating activities less capital expenditures,” was $92.3 million for the fourth quarter. For the full-year 2003, free cash flow was $141.1 million, improved vastly from negative free cash flow (or use of cash) of $68.3 million for 2002.
Crown had approximately 15,577 towers in its portfolio at the end of 2003.
Crown raised its financial guidance for 2004 and now expects to report between $860 million and $870 million in revenues and free cash flow between $145 million and $160 million.
“Based on current run-rate tower revenue and the positive impact of currency movements in the U.K. and Australia, we have raised our 2004 outlook,” explained John Kelly, the company’s president and chief executive officer. “While our 2004 outlook is currently based on the 2003 level of new leasing activity, we continue to see positive signs from the increase in site applications from our customers in the U.S., which may result in additional revenue. Likewise, in the U.K., we continue to see significant activity as customers deploy their 3G networks.”
The company was trading up at $12.58 per share toward the end of the week.
