Citing a net income increase of 23 percent year over year, Crown Castle International said it delivered another “solid year of growth” in 2020, a year where it weathered both the pandemic and threats from activist investor Elliott Management.
Jay Brown, Crown Castle’s CEO, said, “Despite the challenges 2020 presented, we generated industry leading tower revenue growth in the U.S., resulting in AFFO per share growth that was in line with our long-term target range.”
Crown Castle expects the growth to continue in 2021 with 6 percent growth in organic contribution to site rental revenue for the towers segment. The company now has 50,000 small cells on air with 30,000 more in the pipeline, thanks in part to 5G small cell agreement with Verizon (see related story). Brown predicted 5G growth will stretch out to 10 years.
“We believe our ability to offer towers, small cells and fiber solutions, which are all integral components of communications networks and are shared among multiple tenants, provides us the best opportunity to generate significant growth while delivering high returns for our shareholders,” he said. “This differentiated strategy is delivering compelling results, as evidenced by our superior tower revenue growth rate in the U.S., and the strategic long-term agreements we recently announced with Verizon and DISH to support their nationwide 5G buildouts.”
In December 2020, T-Mobile notified Crown Castle it was cancelling approximately 5,700 small cells contracted with Sprint prior to its merger with T-Mobile. The majority of the cancelled small cells were not yet constructed and, upon completion, would have been located at the same locations as other T-Mobile small cells. The Sprint cancellation resulted in T-Mobile accelerating payment of all contractual rental obligations associated with the approximately 5,700 small cells as well as the payment of capital costs incurred to date.
The fourth quarter and full year 2020 results were impacted by the Sprint cancellation and a reduction in staffing completed during the fourth quarter 2020.