Global Signal Inc., the nation’s third-largest tower company with around 11,000 towers, reported a third-quarter net loss of $15.4 million, or 23 cents per share. The numbers are a steep decline from the company’s year-ago net income of $5.3 million, or 10 cents per share.
Global Signal attributed the loss to the costs of integrating Sprint Nextel Corp.’s tower sites into its operations. The company has the exclusive right to lease or operate 6,600 of Sprint Nextel’s towers for 32 years. Global Signal acquired the towers in late May for about $1.2 billion in cash.
The company said its adjusted earnings before interest, taxes, depreciation and amortization rose to $55.5 million, or 79 cents per share, a 65-percent increase from the year-ago figure of 48 cents per share. Adjusted funds from operations increased to $30.3 million, or $43 cents per share, a 26-percent increase from 34 cents a year-ago.
Global Signal said its dividend payment will be 50 cents per share, up 33 percent from last year’s third-quarter dividend payment of 37 cents per share.
“This was our first full quarter of operations since completing the Sprint transaction,” said David Grain, president of Global Signal. “During the third quarter, our sites enjoyed strong leasing activity from both the big four wireless telephony service providers as well as from other national and regional carriers. We continue to have a robust pipeline of applications and I expect it to have a positive impact on our leasing activity next quarter.”
Wall Street didn’t seem to mind news of the company’s losses. Global Signal’s stock was trading up $1.89 per share early Tuesday at $43.03.
The previous week American Tower Corp., the nation’s largest tower company, posted an operating profit of $176.7 million in its rental and management segment, up 49 percent from a year ago. The company reported revenues of $264.7 million for the third quarter, up 46 percent from the year-ago results.
ATC’s results comprise the company’s financial performance as a stand-alone entity through Aug. 3, and the combined results of ATC and SpectraSite Inc. after Aug. 3 following the merger of the two tower companies. The company said $40.6 million of its operating profit came from SpectraSite.
Cash from operations increased to $95.2 million, of which $12.3 million came from SpectraSite, and the company said it has credit facilities valued at $2.45 billion.
The company said it completed construction of 66 towers and installed three in-building systems during the quarter.
“2005 has been a transformational year for American Tower. In addition to our merger with SpectraSite, we have significantly strengthened our financial position,” said Jim Taiclet, chairman and chief executive of ATC. “Looking forward to 2006, the fundamentals of the wireless sector, our customers and the tower industry remain strong.”
For the fourth quarter, the company said it expects revenues of between $295 million and $299 million, and between $200 million and $203 million in operating profits.
In addition, ATC said it expects its $750 million stock repurchase program to be completed by the end of 2006. Under the plan, the company expects to utilize cash from operations, borrowings from its credit facilities and cash on hand to fund the program, with management authorized to purchase shares in open market purchases or in privately negotiated transactions at prevailing market prices.
