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Crown Castle Beats Q3 Earnings & Revenues, Ups Dividend

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Crown Castle International Corp.CCI reported impressive financial numbers in the third quarter of 2015, wherein both earrings and revenues surpassed the Zacks Consensus Estimate.

The company reported earnings per share of $1.07, beating the Zacks Consensus Estimate of $1.04. However, GAAP net income decreased roughly 3% year over year to $103.8 million. Net revenue in the quarter increased 2.8% year over year to $918.1 million, outpacing the Zacks Consensus Estimate of $904 million.

Crown Castle International Corporation - Earnings Surprise | FindTheBest

Gross margin in the reported quarter was 63.6% compared with 62.8% in the year-ago quarter. Operating income stood at $230.8 million compared with $239.1 million in the prior-year quarter. Quarterly adjusted EBITDA was approximately $529.2 million, representing a year-over-year increase of 3%.

Cash Flow

During the third quarter of 2015, funds flow from operations (FFO) totaled $357.8 million versus $336.7 million in the prior-year quarter. FFO per share in the quarter stood at $1.07, up 5.9% year over year. Quarterly adjusted funds flow from operations (AFFO) was $356.4 million compared with $332.2 million in the third quarter of 2014. AFFO per share in the third quarter was $1.07 versus $1.00 in the year-ago quarter.

Balance Sheet

At the end of the quarter under review, Crown Castle had cash and cash equivalents of approximately $184.1 million on its balance sheet compared with $151.3 million at the end of 2014. At the end of the quarter, debt and other long-term obligations totaled approximately $12,039.2 million versus $11,807.5 million at the end of 2014. The debt-to-capitalization ratio stood at 0.62 in comparison with 0.63 at the end of 2014.

Segment Discussion

Site Rental Segment

Quarterly revenues were $764.6 million, up 6.5% year over year. Gross margin for the segment was 67.7% compared with 67.9% in the prior-year quarter.

Network Services Segment

Quarterly revenues were $153.5 million, down 12.4% year over year. Gross margin was 43.4% versus 41.9% in the prior-year quarter.

Dividend Hike

Crown Castle declared a 7.9% increase in its quarterly cash dividend on common stock to 88.5 cents per share from 82 cents paid earlier. The dividend will be paid on Dec 31, 2015, to shareholders of record as on Dec 18, 2015.

Outlook for Fourth-Quarter 2015

For the fourth quarter, Crown Castle expects Site Rental revenues in the range of $778 million to $783 million. Site Rental cost of operation is projected in the band of $241 million to $246 million. Adjusted EBITDA is anticipated between $536 million and $541 million. Site Rental gross margin is expected in the band of $534--$539 million. Interest expense (inclusive of amortization) is estimated in the $126-$131 million band. Meanwhile, FFO is anticipated in the $368-$373 million range. AFFO is projected in the $368-$373 million range and AFFO per share is estimated in the range of $1.10--$1.12 per share. Net income is forecasted at $99-$132 million.

Outlook for Full-Year 2015

For 2015, Crown Castle expects Site Rental revenues in the range of $3,011-$3,016 million (earlier guidance was $2,949-$2,959 million). Site Rental cost of operation is projected in the $957-$962 million band (earlier $942-$952 million). Site Rental gross margin is expected between $2,050 million and $2,055 million (earlier $2,000-$2,010 million). Adjusted EBITDA is anticipated between $2,115 million and $2,120 million (earlier $2,073-$2,088 million). Interest expense (inclusive of amortization) is estimated in the $525-$530 million range (earlier $513-$528 million). FFO is projected at the $1,491-$1,496 million band (earlier $1,463-$1,478 million). AFFO is expected between $1,433 million and $1,438 million (earlier $1,405-$1,420 million) and AFFO per share is estimated in the range of $4.29--$4.31 per share (earlier $4.21 to $4.25). Net income is anticipated between $1,481 million and $1,514 million (earlier $1,463-$1,542 million).

Outlook for Full-Year 2016

For 2016, Crown Castle expects Site Rental revenues in the range of $3,152-$3,177 million. Site Rental cost of operation is projected in the $989-$1,014 million band. Site Rental gross margin is expected between $2,153 million and 2,178 million. Adjusted EBITDA is anticipated between $2,156 million and $2,181 million. Interest expense (inclusive of amortization) is estimated in the $517-$537 million range. FFO is projected at the $1,467-$1,492 million band. AFFO is expected between $1,550 million and $1,575 million and AFFO per share is estimated in the range of $4.62--$4.69 per share. Net income is anticipated between $409 million and $508 million.

Stocks to Consider

Crown Castle carries a Zacks Rank #3 (Hold). Better-ranked stocks in this sector include CoreSite Realty Corporation COR , CubeSmart CUBE and Ashford Hospitality Trust, Inc. AHT . While CoreSite Realty and CubeSmart sport a Zacks Rank #1 (Strong Buy), Ashford Hospitality Trust holds a Zacks Rank #2 (Buy).

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CROWN CASTLE (CCI): Free Stock Analysis Report

ASHFORD HOSPTLY (AHT): Free Stock Analysis Report

CUBESMART (CUBE): Free Stock Analysis Report

CORESITE REALTY (COR): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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