10-Q 1 sbac-20220630x10q.htm 10-Q sbac-20220630x10q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2022

OR

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

For the transition period from __________ to __________

Commission file number: 001-16853

SBA COMMUNICATIONS CORPORATION

(Exact name of Registrant as specified in its charter)

Florida

65-0716501

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

8051 Congress Avenue

Boca Raton, Florida

33487

(Address of principal executive offices)

(Zip Code)

Registrant’s telephone number, including area code (561995-7670

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

Title of Each Class

Trading Symbol

Name of Each Exchange on Which Registered

Class A Common Stock, $0.01 par value per share

SBAC

The NASDAQ Stock Market LLC

(NASDAQ Global Select Market)

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  x    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 (Section 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  x   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

x

Accelerated Filer

¨

Non-Accelerated Filer

¨

Smaller Reporting Company

¨

Emerging Growth Company

¨

If an emerging growth company, indicate by checkmark 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  x

Indicate the number of shares outstanding of each issuer’s classes of common stock, as of the latest practicable date: 107,878,343 shares of Class A common stock as of July 27, 2022.

Table of Contents

 

 

Page

PART I – FINANCIAL INFORMATION 

Item 1.

Financial Statements

 

Consolidated Balance Sheets as of June 30, 2022 (unaudited) and December 31, 2021

1 

Consolidated Statements of Operations (unaudited) for the three and six months ended June 30, 2022 and 2021

2 

Consolidated Statements of Comprehensive Income (unaudited) for the three and six months ended June 30, 2022 and 2021

3 

Consolidated Statement of Shareholders’ Deficit (unaudited) for the three and six months ended June 30, 2022 and 2021

4 

Consolidated Statements of Cash Flows (unaudited) for the six months ended June 30, 2022 and 2021

6 

Condensed Notes to Consolidated Financial Statements (unaudited)

8 

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

21

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

38

Item 4.

Controls and Procedures

41

PART II – OTHER INFORMATION 

Item 6.

Exhibits

41

SIGNATURES

42

PART I – FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (in thousands, except par values)

June 30,

December 31,

2022

2021

ASSETS

(unaudited)

Current assets:

Cash and cash equivalents

$

183,067

$

367,278

Restricted cash

64,495

65,561

Accounts receivable, net

115,137

101,950

Costs and estimated earnings in excess of billings on uncompleted contracts

54,781

48,844

Prepaid expenses and other current assets

77,419

30,813

Total current assets

494,899

614,446

Property and equipment, net

2,677,983

2,575,487

Intangible assets, net

2,800,562

2,803,247

Operating lease right-of-use assets, net

2,355,881

2,268,470

Acquired and other right-of-use assets, net

1,002,785

964,405

Other assets

679,827

575,644

Total assets

$

10,011,937

$

9,801,699

LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS,

AND SHAREHOLDERS' DEFICIT

Current Liabilities:

Accounts payable

$

41,455

$

34,066

Accrued expenses

85,697

68,070

Current maturities of long-term debt

662,720

24,000

Deferred revenue

199,829

184,380

Accrued interest

50,841

49,096

Current lease liabilities

256,572

238,497

Other current liabilities

21,086

18,222

Total current liabilities

1,318,200

616,331

Long-term liabilities:

Long-term debt, net

11,817,504

12,278,694

Long-term lease liabilities

2,047,385

1,981,353

Other long-term liabilities

227,578

191,475

Total long-term liabilities

14,092,467

14,451,522

Redeemable noncontrolling interests

39,881

17,250

Shareholders' deficit:

Preferred stock - par value $0.01, 30,000 shares authorized, no shares issued or outstanding

Common stock - Class A, par value $0.01, 400,000 shares authorized, 107,872 shares and

108,956 shares issued and outstanding at June 30, 2022 and December 31, 2021,

respectively

1,079

1,089

Additional paid-in capital

2,717,963

2,681,347

Accumulated deficit

(7,531,180)

(7,203,531)

Accumulated other comprehensive loss, net

(626,473)

(762,309)

Total shareholders' deficit

(5,438,611)

(5,283,404)

Total liabilities, redeemable noncontrolling interests, and shareholders' deficit

$

10,011,937

$

9,801,699

The accompanying condensed notes are an integral part of these consolidated financial statements.

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited) (in thousands, except per share amounts)

For the three months

For the six months

ended June 30,

ended June 30,

2022

2021

2022

2021

Revenues:

Site leasing

$

580,233

$

524,095

$

1,139,665

$

1,029,197

Site development

71,773

51,433

132,111

95,069

Total revenues

652,006

575,528

1,271,776

1,124,266

Operating expenses:

Cost of revenues (exclusive of depreciation, accretion,

and amortization shown below):

Cost of site leasing

111,515

95,350

218,670

190,718

Cost of site development

54,497

40,409

100,269

74,815

Selling, general, and administrative expenses (1)

63,274

53,945

125,398

105,546

Acquisition and new business initiatives related

adjustments and expenses

6,829

6,794

11,933

11,795

Asset impairment and decommission costs

8,521

3,797

17,033

8,700

Depreciation, accretion, and amortization

176,392

175,469

350,716

359,350

Total operating expenses

421,028

375,764

824,019

750,924

Operating income

230,978

199,764

447,757

373,342

Other income (expense):

Interest income

1,517

547

4,020

1,179

Interest expense

(84,315)

(90,544)

(166,566)

(180,639)

Non-cash interest expense

(11,529)

(11,812)

(23,054)

(23,615)

Amortization of deferred financing fees

(4,922)

(4,865)

(9,804)

(9,755)

Loss from extinguishment of debt, net

(2,020)

(13,672)

Other (expense) income, net

(66,141)

108,849

42,019

20,410

Total other (expense) income, net

(165,390)

155

(153,385)

(206,092)

Income before income taxes

65,588

199,919

294,372

167,250

Benefit (provision) for income taxes

3,563

(47,250)

(36,914)

(26,328)

Net income

69,151

152,669

257,458

140,922

Net loss attributable to noncontrolling interests

365

682

Net income attributable to SBA Communications

Corporation

$

69,516

$

152,669

$

258,140

$

140,922

Net income per common share attributable to SBA

Communications Corporation:

Basic

$

0.64

$

1.40

$

2.39

$

1.29

Diluted

$

0.64

$

1.37

$

2.36

$

1.27

Weighted average number of common shares

Basic

107,850

109,412

107,966

109,441

Diluted

109,347

111,301

109,443

111,210

(1)Includes non-cash compensation of $23,248 and $21,077 for the three months ended June 30, 2022 and 2021, respectively, and $47,364 and $40,661 for the six months ended June 30, 2022 and 2021, respectively.

The accompanying condensed notes are an integral part of these consolidated financial statements.

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited) (in thousands)

For the three months

For the six months

ended June 30,

ended June 30,

2022

2021

2022

2021

Net income

$

69,151

$

152,669

$

257,458

$

140,922

Adjustments related to interest rate swaps

23,833

5,565

109,155

48,352

Foreign currency translation adjustments

(59,021)

63,869

26,485

20,235

Comprehensive income

33,963

222,103

393,098

209,509

Comprehensive loss attributable to noncontrolling interests

444

878

Comprehensive income attributable to SBA

Communications Corporation

$

34,407

$

222,103

$

393,976

$

209,509

The accompanying condensed notes are an integral part of these consolidated financial statements.


SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ DEFICIT

(unaudited) (in thousands)

Accumulated

Class A

Additional

Other

Total

Common Stock

Paid-In

Accumulated

Comprehensive

Shareholders'

Shares

Amount

Capital

Deficit

Loss, Net

Deficit

BALANCE, March 31, 2022

107,806 

$

1,078 

$

2,688,835 

$

(7,523,696)

$

(591,364)

$

(5,425,147)

Net income attributable to SBA

Communications Corporation

69,516 

69,516 

Common stock issued in connection with equity

awards and stock purchase plans, offset

by the impact of net share settlements

66 

1 

9,010 

9,011 

Non-cash stock compensation

24,406 

24,406