cci-20220331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________

FORM 10-Q

___________________________________


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period to

Commission File Number 001-16441

____________________________________

CROWN CASTLE INTERNATIONAL CORP.

(Exact name of registrant as specified in its charter)


Delaware						76-0470458
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

8020 Katy Freeway, Houston, Texas 77024

(Address of principal executives office) (Zip Code)

(713) 570-3000

(Registrant's telephone number, including area code)

____________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	CCI	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of common stock outstanding at April 26, 2022: 433,031,679

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

INDEX


		Page
PART I—FINANCIAL INFORMATION		3
ITEM 1.	FINANCIAL STATEMENTS	3
	CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)	3
	CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited)	4
	CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)	5
	CONDENSED CONSOLIDATED STATEMENT OF EQUITY (Unaudited)	6
	NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)	7
ITEM 2.	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	17
ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	29
ITEM 4.	CONTROLS AND PROCEDURES	30
PART II—OTHER INFORMATION		30
ITEM 1.	LEGAL PROCEEDINGS	30
ITEM 1A.	RISK FACTORS	30
ITEM 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	30
ITEM 6.	EXHIBITS	31
EXHIBIT INDEX		31
SIGNATURES		32

Cautionary Language Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q ("Form 10-Q") contains forward-looking statements that are based on our management's expectations as of the filing date of this report with the Securities and Exchange Commission ("SEC"). Statements that are not historical facts are hereby identified as forward-looking statements. In addition, words such as "estimate," "anticipate," "project," "plan," "intend," "believe," "expect," "likely," "predicted," "positioned," "continue," "target," "seek," "focus" and any variations of these words and similar expressions are intended to identify forward-looking statements. Such statements include plans, projections and estimates contained in "Part I—Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations" ("MD&A"), "Part I—Item 3. Quantitative and Qualitative Disclosures About Market Risk" and "Part II—Item 1A. Risk Factors" herein. Such forward-looking statements include (1) benefits and opportunities stemming from our strategy, strategic position, business model and capabilities, (2) the strength and growth potential of the U.S. market for shared communications infrastructure investment, (3) expectations regarding anticipated growth in the wireless industry, and consumption of and demand for data, including growth in, and factors driving, consumption and demand, (4) potential benefits of our communications infrastructure (on an individual and collective basis) and expectations regarding demand therefore, including potential benefits and continuity of and factors driving such demand, (5) expectations regarding construction, including duration of our construction projects, and acquisition of communications infrastructure, (6) the utilization of our net operating loss carryforwards ("NOLs"), (7) expectations regarding wireless carriers' focus on improving network quality and expanding capacity, (8) expectations regarding continued increase in usage of high-bandwidth applications by organizations, (9) expected use of net proceeds from issuances under the commercial paper program ("CP Program"), (10) our full year 2022 outlook and the anticipated growth in our financial results, including future revenues and operating cash flows, and the expectations regarding our capital expenditures, as well as the factors impacting expected growth in financial results and the levels of capital expenditures, (11) expectations regarding our capital structure and the credit markets, our availability and cost of capital, capital allocation, our leverage ratio target, our ability to service our debt and comply with debt covenants and the plans for and the benefits of any future refinancings, (12) the utility of certain financial measures, including non-GAAP financial measures, (13) expectations related to our ability to remain qualified as a real estate investment trust ("REIT") and the advantages, benefits or impact of, or opportunities created by, our REIT status, (14) adequacy, projected sources and uses of liquidity, (15) our dividend policy and the timing, amount, growth or tax characterization of our dividends, (16) the potential impact of the coronavirus (COVID-19) pandemic and any measures taken with respect thereto, (17) availability of spectrum, (18) the T-Mobile Agreement (as defined below), including expectations related thereto and the benefits that may be derived therefrom, and the the impact from the T-Mobile and Sprint network

consolidation contemplated therein, (19) discretionary investments and the benefits that may be derived therefrom, (20) potential adjustments in the interest rate spread and unused commitment fee percentage on our 2016 Credit Facility and (21) the outcome of outstanding litigation. All future dividends are subject to declaration by our board of directors.

Such forward-looking statements should, therefore, be considered in light of various risks, uncertainties and assumptions, including prevailing market conditions, risk factors described in "Item 1A. Risk Factors" of the Annual Report on Form 10-K for the fiscal year ended December 31, 2021 ("2021 Form 10-K") and other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those expected.

Our filings with the SEC are available through the SEC website at www.sec.gov or through our investor relations website at investor.crowncastle.com. We use our investor relations website to disclose information about us that may be deemed to be material. We encourage investors, the media and others interested in us to visit our investor relations website from time to time to review up-to-date information or to sign up for e-mail alerts to be notified when new or updated information is posted on the site.

Interpretation

As used herein, the term "including," and any variation thereof, means "including without limitation." The use of the word "or" herein is not exclusive. Unless this Form 10-Q indicates otherwise or the context otherwise requires, the terms "we," "our," "our company," "the company" or "us" as used in this Form 10-Q refer to Crown Castle International Corp. ("CCIC") and its predecessor (organized in 1995), as applicable, each a Delaware corporation, and their subsidiaries. Additionally, unless the context suggests otherwise, references to "U.S." are to the United States of America and Puerto Rico, collectively. Capitalized terms used but not defined in this Form 10-Q have the same meaning given to them in the 2021 Form 10-K.

PART I—FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)

(Amounts in millions, except par values)


	March 31, 2022		December 31, 2021
ASSETS
Current assets:
Cash and cash equivalents	$	312	$	292
Restricted cash	165		169
Receivables, net	503		543
Prepaid expenses	119		105
Other current assets	162		145
Total current assets	1,261		1,254
Deferred site rental receivables	1,682		1,588
Property and equipment, net of accumulated depreciation of $12,220 and $11,937, respectively	15,226		15,269
Operating lease right-of-use assets	6,739		6,682
Goodwill	10,078		10,078
Other intangible assets, net	3,935		4,046
Other assets, net	130		123
Total assets	$	39,051	$	39,040

LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	224	$	246
Accrued interest	117		182
Deferred revenues	721		776
Other accrued liabilities	288		401
Current maturities of debt and other obligations	71		72
Current portion of operating lease liabilities	355		349
Total current liabilities	1,776		2,026
Debt and other long-term obligations	21,055		20,557
Operating lease liabilities	6,078		6,031
Other long-term liabilities	2,106		2,168
Total liabilities	31,015		30,782
Commitments and contingencies (note 8)
Stockholders' equity:
Common stock, $0.01 par value; 600 shares authorized; shares issued and outstanding: March 31, 2022—433 and December 31, 2021—432	4		4
Additional paid-in capital	18,006		18,011
Accumulated other comprehensive income (loss)	(3)		(4)
Dividends/distributions in excess of earnings	(9,971)		(9,753)
Total equity	8,036		8,258
Total liabilities and equity	$	39,051	$	39,040

See notes to condensed consolidated financial statements.

CROWN CASTLE INTERNATIONAL CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS AND

COMPREHENSIVE INCOME (LOSS) (Unaudited)

(Amounts in millions, except per share amounts)


	Three Months Ended March 31,
	2022		2021
Net revenues:
Site rental	$	1,576	$	1,369
Services and other	166		116
Net revenues	1,742		1,485
Operating expenses:
Costs of operations:(a)
Site rental	396		381
Services and other	113		81
Selling, general and administrative	181		164
Asset write-down charges	14		3

Depreciation, amortization and accretion	420		408
Total operating expenses	1,124		1,037
Operating income (loss)	618		448
Interest expense and amortization of deferred financing costs	(164)		(170)
Gains (losses) on retirement of long-term obligations	(26)		(143)
Interest income	—		1
Other income (expense)	(1)		(8)
Income (loss) before income taxes	427		128
Benefit (provision) for income taxes	(6)		(7)

SEC Form 10-Q filed by Crown Castle International Corp. (REIT)