SBA Communications Corp. (SBAC, Financial) filed Quarterly Report for the period ended 2009-03-31.
SBA Communications Corp. is a leading independent owner and operator of wireless communications infrastructure in the United States. The company generates revenue from two primary businesses -- site leasing and site development services. The primary focus of the company is the leasing of antenna space on its multi- tenant towers to a variety of wireless service providers under long-term lease contracts. (PRESS RELEASE) SBA Communications Corp. has a market cap of $2.89 billion; its shares were traded at around $24.44 with and P/S ratio of 6.1. SBA Communications Corp. had an annual average earning growth of 4.8% over the past 5 years.
include replacing lighting systems, painting a tower or upgrading or repairing an access road or fencing. Lastly, land leases generally have an initial term of five years with five or more additional automatic renewal periods of five years at our option and provide for rent escalators which typically average 3% - 4% annually or provide for term escalators of approximately 15%. Of the 7,884 towers in our portfolio, as of March 31, 2009, approximately 26.2% are located on parcels of land that we own, land subject to perpetual easements, or parcels of land that have a leasehold interest that extends beyond 50 years.
Our site leasing business generates substantially all of our total segment operating profit. As indicated in the table below, our site leasing business generated 85.5% and 81.3% of our total revenue during the three months ended March 31, 2009 and March 31, 2008, respectively. For information regarding our operating segments, please see Note 14 of our Condensed Notes to Consolidated Financial Statements included in this quarterly report.
Effective January 1, 2009, we adopted FASB Staff Position (FSP) Accounting Principles Board (APB) 14-1, Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement) (FSP APB 14-1). FSP APB 14-1 requires the issuer of certain convertible debt instruments that may be settled in cash (including partial cash settlement) on conversion to separately account for the liability (debt) and equity (conversion option) components of the instrument in a manner that reflects the issuers non-convertible debt borrowing rate. Our 0.375% Convertible Senior Notes due 2010 and 1.875% Convertible Senior Notes due 2013 are subject to FSP APB 14-1. FSP APB 14-1 requires companies to retroactively apply the requirements of the pronouncement to all periods presented. In accordance with FSP APB 14-1, we recorded a debt discount and corresponding increase to additional paid in capital of approximately $74.4 million for the 0.375% Notes and approximately $163.0 million for the 1.875% Notes as of their date of issuance (March 26, 2007 for the 0.375% Notes and May 16, 2008 for the 1.875% Notes). Our consolidated balance sheet as of December 31, 2008 has been retroactively adjusted to reduce the carrying value of the 0.375% Notes and 1.875% Notes and reflect the conversion option in equity. In addition, we have reclassified, as a reduction to equity, deferred financing fees of $1.8 million and $3.8 million for the 0.375% Notes and 1.875% Notes, respectively, related to debt issuance costs of the equity component of the convertible debt. Our consolidated statement of operations and consolidated statement of cash flows for the three months ended March 31, 2008 have been retroactively adjusted to reflect the non-cash interest expense related to the accretion of the reduced carrying value of the convertible notes back to its full principal balance over the term of the convertible notes. In addition, the amortization of deferred financing fees has been restated to reflect the amortization of the deferred financing fees related only to the liability component of the convertible debt. See Note 9 to the consolidated financial statements for a summary of the effects on our consolidated statement of operations for the three months ended March 31, 2008 and consolidated balance sheet as of December 31, 2008. The accompanying Managements Discussion and Analysis reflects the changes due to the implementation of FSP APB 14-1.
Read the The complete ReportSBAC is in the portfolios of Ron Baron of Baron Funds.
SBA Communications Corp. is a leading independent owner and operator of wireless communications infrastructure in the United States. The company generates revenue from two primary businesses -- site leasing and site development services. The primary focus of the company is the leasing of antenna space on its multi- tenant towers to a variety of wireless service providers under long-term lease contracts. (PRESS RELEASE) SBA Communications Corp. has a market cap of $2.89 billion; its shares were traded at around $24.44 with and P/S ratio of 6.1. SBA Communications Corp. had an annual average earning growth of 4.8% over the past 5 years.
Highlight of Business Operations:
Our primary focus is the leasing of antenna space on our multi-tenant towers to a variety of wireless service providers under long-term lease contracts. Site leasing revenues are received primarily from wireless service provider tenants, including AT&T, Sprint, T-Mobile and Verizon Wireless. Wireless service providers enter into numerous different tenant leases with us, each of which relates to the lease or use of space at an individual tower site. Tenant leases are generally for an initial term of five years renewable for five five-year renewal periods at the option of the tenant. These tenant leases typically contain specific rent escalators, which average 3% - 4% per year, including the renewal option periods. Tenant leases are generally paid on a monthly basis and revenue from site leasing is recorded monthly on a straight-line basis over the current term of the related lease agreements. Rental amounts received in advance are recorded as deferred revenue.include replacing lighting systems, painting a tower or upgrading or repairing an access road or fencing. Lastly, land leases generally have an initial term of five years with five or more additional automatic renewal periods of five years at our option and provide for rent escalators which typically average 3% - 4% annually or provide for term escalators of approximately 15%. Of the 7,884 towers in our portfolio, as of March 31, 2009, approximately 26.2% are located on parcels of land that we own, land subject to perpetual easements, or parcels of land that have a leasehold interest that extends beyond 50 years.
Our site leasing business generates substantially all of our total segment operating profit. As indicated in the table below, our site leasing business generated 85.5% and 81.3% of our total revenue during the three months ended March 31, 2009 and March 31, 2008, respectively. For information regarding our operating segments, please see Note 14 of our Condensed Notes to Consolidated Financial Statements included in this quarterly report.
Effective January 1, 2009, we adopted FASB Staff Position (FSP) Accounting Principles Board (APB) 14-1, Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement) (FSP APB 14-1). FSP APB 14-1 requires the issuer of certain convertible debt instruments that may be settled in cash (including partial cash settlement) on conversion to separately account for the liability (debt) and equity (conversion option) components of the instrument in a manner that reflects the issuers non-convertible debt borrowing rate. Our 0.375% Convertible Senior Notes due 2010 and 1.875% Convertible Senior Notes due 2013 are subject to FSP APB 14-1. FSP APB 14-1 requires companies to retroactively apply the requirements of the pronouncement to all periods presented. In accordance with FSP APB 14-1, we recorded a debt discount and corresponding increase to additional paid in capital of approximately $74.4 million for the 0.375% Notes and approximately $163.0 million for the 1.875% Notes as of their date of issuance (March 26, 2007 for the 0.375% Notes and May 16, 2008 for the 1.875% Notes). Our consolidated balance sheet as of December 31, 2008 has been retroactively adjusted to reduce the carrying value of the 0.375% Notes and 1.875% Notes and reflect the conversion option in equity. In addition, we have reclassified, as a reduction to equity, deferred financing fees of $1.8 million and $3.8 million for the 0.375% Notes and 1.875% Notes, respectively, related to debt issuance costs of the equity component of the convertible debt. Our consolidated statement of operations and consolidated statement of cash flows for the three months ended March 31, 2008 have been retroactively adjusted to reflect the non-cash interest expense related to the accretion of the reduced carrying value of the convertible notes back to its full principal balance over the term of the convertible notes. In addition, the amortization of deferred financing fees has been restated to reflect the amortization of the deferred financing fees related only to the liability component of the convertible debt. See Note 9 to the consolidated financial statements for a summary of the effects on our consolidated statement of operations for the three months ended March 31, 2008 and consolidated balance sheet as of December 31, 2008. The accompanying Managements Discussion and Analysis reflects the changes due to the implementation of FSP APB 14-1.
Read the The complete ReportSBAC is in the portfolios of Ron Baron of Baron Funds.
