Crown Castle Inc. · NYSE:CCI
Crown Castle — 2009 DB Leveraged Finance Conference
30 slides from Crown Castle's conference presentation, 2009
Slide 1: NYSE: CCI - Jay Brown, CFO & Treasurer
NYSE: CCI Jay Brown, CFO & Treasurer
Slide 2: Cautionary Information
Cautionary Information This presentation contains forward-looking statements and information that are based on management’s current expectations. Such statements include, but are not limited to plans, projections, Outlook and estimates regarding (i) the payment, repurchase or refinancing of our debt
Slide 3: Real Estate Provider to the Wireless Industry
Real Estate Provider to the Wireless Industry 3
Slide 4: Attractive Business Fundamentals
Attractive Business Fundamentals ¾ Growing long-term contracted revenues (1) o Forecasted site rental revenue growth of 9% ¾ High incremental margins on new revenue o 93% from Q2 ‘06 to Q2 ‘09 ¾ Well-positioned portfolio o 71% of towers located in the top 100 BTAs ¾ Long-term control of assets o Own
Slide 5: Section 1: Business Overview
Wiest Section 1 Business Overview
Slide 6: US Tower Footprint
US Tower Footprint Over 22,000 US Towers (1) Significant Presence in 91 of the Top 100 BTAs (1) Basic Trading Areas as defined by Rand McNally & Co and as used by the FCC to determine service areas for PCS wireless licenses 6
Slide 7: Best Positioned Towers
Best Positioned Towers TOP 100 BTAs TOP 50 BTAs ¾ 71% of towers in the top 100 BTAs and Number of Towers 15,000 CCI 54% of towers in the top 50 BTAs o Top 100 BTAs represent 74% of US AMT CCI POPs 10,000 ¾ 3,300+ more towers in the top 100 BTAs than nearest competitor AMT 5,000 SBAC SBAC 0 Note: AMT
Slide 8: Consistent Results
Consistent Results(1,2) ($ in millions) Incremental margin on new revenue since Q2 ‘06 is 93% $400 $376 CAGR $368 $345 $349 $354 $355 9% $338 $322 $327 $311 $316 $307 $300 $292 13% $200 $100 $0 Q2:06 Q3:06 Q4:06 Q1:07 Q2:07 Q3:07 Q4:07 Q1:08 Q2:08 Q3:08 Q4:08 Q1:09 Q2:09 Site Rental Revenue Site Ren
Slide 9: Q2 Operating Highlights
Q2 Operating Highlights $ in millions Site Rental Revenue Site Rental Gross Margin Adjusted EBITDA ($4) FX Impact ($3) ($2) As Reported $349 $376 $235 $263 $213 $247 Q2 ‘08 Q2 ‘09 Q2 ‘08 Q2 ‘09 Q2 ‘08 Q2 ‘09 FX-Adjusted Growth 9% 13% 17% FX-Adjusted $380 $266 $249 FX Impact 9
Slide 10: Q2 Operating Highlights (cont'd)
Q2 Operating Highlights (cont’d) $ in millions except per share amounts Recurring Cash Flow Recurring Cash Flow / Share ($2) ($0.01) FX Impact As Reported $119 $132 $0.43 $0.46 Q2 ‘08 Q2 ‘09 Q2 ‘08 Q2 ‘09 FX-Adjusted Growth 12% 9% FX-Adjusted $134 $0.47 FX Impact 10
Slide 11: Long-Term Contracted Revenues
Long-Term Contracted Revenues Q2 ‘09 Total Revenue Q2 ‘09 Site Rental Revenue Australia US Site Rental Site Rental Revenue Telephony 91% Revenue 4% 88% Data/Other 6% Service Revenue Broadcast 2% 8% Paging 1% Annualized = $1.6 billion Annualized = $1.5 billion ¾ Primary business is leasing tower spac
Slide 12: High-Quality Revenues
High-Quality Revenues (1) Q2 ‘09 US Site Rental Revenue Highest Exposure to Leading (2) US Wireless Carriers Big 4 Site Rental Revenues Per Tower(3) ($ in thousands) Big 4 Wireless Carriers 79% Other $50.6 $43.8 21% $36.3 (4) CCI AMT SBAC Big 4 as a % of Site 79% 64% 62% Rental Revenue (1) Run-rate
Slide 13: Section 2: Industry Outlook
Wiest Section 2 Industry Outlook
Slide 14: Opportunity For Growth
Opportunity For Growth Drivers of Future Site Demand Crown Castle is Best Positioned ¾ Carrier focus on improving network quality ¾ Most towers in the top 50 and top 100 BTAs ¾ Increasing voice MOU usage ¾ Portfolio comprised primarily of acquired ¾ Increasing data usage towers from Verizon, AT&T, S
Slide 15: Key Demand Drivers
Key Demand Drivers Estimated Annual Wireless Network MOUs (Voice and Data Equivalent) (in billions) 6,677 5,418 ¾ Growth in MOUs and data is a key driver 4,202 3,215 of the need for additional sites ¾ Network quality remains key factor in 2008 2010E 2012E 2014E the retention of subscribers Estimated
Slide 16: Landline Disconnections
Landline Disconnections Landlines % Decrease (2005 – 2007) US Households Telephony Demographics 60% Netherlands 40% US OECD (1) 20% Great Britain 0% -25% -20% -15% -10% -5% 0% 1H:05 2H:05 1H:06 2H:06 1H:07 2H:07 1H:08 2H:08 Mobile Only Landline Only, Wireless Status Unknown, or Phoneless Landline &
Slide 17: Consumer Data Penetration
Consumer Data Penetration (units in millions) Smartphone Market Penetration 29% 500 30% 24% ¾ Smartphones are the fastest growing 400 24% 20% segment of handset sales globally 300 16% 18% ¾ Smartphone market expected to grow 444 by 147%, compared to 36% for the 200 12% 339 handset market overall, fr
Slide 18: Accelerated Growth of Data ARPU
Accelerated Growth of Data ARPU (1) (2) Data ARPU as a % of Total ARPU ($ in billions) Wireless Data Revenue 100% 80% 60% $82 40% $17.7 $66 $15.4 $12.4 $48 $54 $9.4 $42 20% $6.4 $34 $2.5 $4.1 24.3% 30.2% 35.0% 18.7% 0% 4.9% 8.2% 13.0% 2004 2005 2006 2007 2008 2009E 2010E 2008 2009E 2010E 2011E 2012E
Slide 19: Section 3: Capital Structure
Wiest Section 3 Capital Structure
Slide 20: Pro Forma Debt Maturity Schedule
Pro Forma Debt Maturity Schedule (1) $ in millions (2) $1,704 (3) $1,550 $1,219 $919 $625 $3 $19 $24 $25 $26 $19 2009 2010 2011 2012 2013 2014 2015 2016 2017 2035 2036 (1) Pro forma for issuance of CC Series 2009-1 (2) Anticipated refinance date is in June 2010; amount reflects buybacks (3) Anticipa
Slide 21: Pro Forma Debt Schedule and Ratios
Pro Forma Debt Schedule and Ratios $ in millions ISSUE Face Amount Final 2007 Crown Castle Operating Company Term Loan $635.4 March 5, 2014 9% Senior Notes $900.0 January 15, 2015 7.75% Senior Secured Notes Due 2017 $1,200.0 May 1, 2017 6.25% Senior Secured Notes, Series 2009-1, Class A-1 $175.0 Aug
Slide 22: Best Positioned to Capture Future Value from Leasing Growth
Best Positioned to Capture Future Value from Leasing Growth (1) Common Shares per Tower Equity Capital per Tower (1) (in thousands) ($ in thousands) Crown Castle has fewer shares per tower, so as revenue is added, it is divided among fewer shares 15.7 14.6 $509 11.9 $360 $336 Impact of CCI AMT SBAC
Slide 23: Financial Measures Appendix
Financial Measures Appendix
Slide 24: Non-GAAP Financial Measures
Non-GAAP Financial Measures 24
Slide 25: Non-GAAP Financial Measures
Non-GAAP Financial Measures 25
Slide 26: Non-GAAP Financial Measures
Non-GAAP Financial Measures 26
Slide 27: Other Calculations
Other Calculations CASTLE (Other Calculations ‘Site rental pross margin for Crowm Castle far the quarters ended March 31, 2006, .hme 30, 2006, September 30, 2006, Deceraber 31, 2006, March 31, 2007, .kune 30, 2007, Septeraber 30, 2007, December 31, 2007, March 31, 2008, kane 30, 2008, Septeraber 30,
Slide 28: Other Calculations
Other Calculations Equity Capital Per Tower, Incremental Cash Flow per Share and Incremental Return an Equity Capital for Crown Castle, AMT and SBAC for the three manths ended June 30, 2009 are computed as follows: (6S in millions, except per share and per tower amounts) june 30, 2009 Crown Castle A
Slide 29: Other Calculations
Other Calculations \\ Site rental revenue, site rental gross margin (tower gross margin), Adjusted EBITDA, recurring cash flow and recurring cash flow per share change far Crown Castle far the quarters ended ume 30, 2009 and -ume 30, 2008 is computed as fallows: For the Three Months Ended (in thousa
Slide 30: Other Calculations
Other Calculations "A WN ¢ ail E Foreign exchange impact on site rental revenue, site rental gross margin {tower gross margin), Adjusted EBITDA, recurring cach flow and recurring cash flow per share for Crown Castle far the quarter ended June 30, 2009 are computed as follows: Assumed Q? 2008 AUD/USD