SARASOTA, Fla.—For the fourth quarter in a row, Global Signal Inc. blamed its net losses on the company’s $1.2 billion cash purchase of 6,600 Sprint Nextel Corp. towers, which the company announced in May 2005.
Posting first-quarter losses of $35.1 million from revenue of $120.9 million, Global Signal pointed directly to $21.1 million in expenses related to the Sprint Nextel tower deal as the reason for its financial woes.
Last year, prior to the Sprint Nextel deal, Global Signal posted first-quarter net income of $3.9 million based on $53.8 million in revenue.
“We had a solid first quarter and a strong start to the year,” stated Wesley Edens, chairman of Global Signal. “The tower industry fundamentals remain terrific as our wireless customers continue to add new sites to their networks to support their subscriber growth and new technologies.”
During the quarter, Global Signal said it spent $18.9 million to acquire 10 additional towers along with fee interests and both permanent and long-term easements for land under 109 of its towers.
Looking forward, the company outlined three areas of focus: adding tenants to its existing towers, acquiring towers with existing tenants in areas it considers important, and financing newly acquired sites on a long-term basis.
As of the end of the quarter, Global Signal reported ownership of about 11,000 towers, placing its portfolio in third place among the nation’s tower companies. Crown Castle International Corp. is the second largest tower company, with more than 13,000 sites, and American Tower Corp. sits securely in the top spot with more than 22,000 sites.
Wall Street seemed a bit disappointed with the earnings report, as Global Signal’s stock traded down $1.11 at $50.50 per share during morning trading.
