Crown Castle International reported their earnings results for the first quarter last week. In the company’s conference call, Jay Brown, Chief Financial Officer, Senior Vice President and Treasurer, said that, “during the quarter, we made significant progress integrating the AT&T towers, the integration of which we expect to be substantially complete by the fall of this year.” In December 2013, CCI acquired exclusive rights to approximately 9,700 AT&T towers. Also during the first quarter, CCI made progress with their small cell technology. “As a part of the new leasing activity, we are continuing to see very strong demand for our small cell networks. At the end of the first quarter, we had nearly 12,000 small cell nodes and over 6,000 miles of fiber. The contribution to site rental revenue from our small cell networks is up approximately 20% year-over-year,” Brown said. Brown also discussed the company’s proactive approach to achieving long-term control of the ground beneath their sites. This is core to their business as they work to protect their assets and control their largest operating expense.
Brown explained, “Additionally, we purchased land beneath approximately 130 of our towers during the quarter. As of today, we own or control, for more than 20 years, land under towers representing 72% of our site rental gross margin. In fact, today, approximately 1/3 of our site rental gross margin is generated from towers on land that we own. Where we have ground leases, the average term remaining on our ground leases is approximately 30 years.” Benjamin Moreland, Chief Executive Officer, President and Director, explained that they are excited about this upcoming year. “As all 4 major wireless carriers continue to invest in their networks for LTE and capacity enhancement, I’m excited about the prospects of sustainable long-term growth over the next several years. This is particularly true given our position as the leading shared wireless infrastructure provider in the U.S., nearly 40,000 towers and 12,000 small cell nodes in operation,” he said. The number of devices that rely on the cellular network, has grown tremendously, which provides an optimistic outlook for executives at Crown Castle as they see the need to capacity increasing steadily.
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