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Robin Hood Investors Conference October 21, 2014 CORVEX MANAGEMENT LP | 712 Fifth Avenue, 23rd

Robin Hood Investors Conference October 21, 2014

CORVEX MANAGEMENT LP | 712 Fifth Avenue, 23rd Floor | New York, New York 10019

Disclaimer

Corvex Management LP (“Corvex”) is an investment adviser to funds that buy, hold and sell securities and other financial instruments. This presentation does not constitute either an offer to sell or a solicitation o f an offer to buy any interest in any fund or entity associated with or advise d by Corvex.

Funds or entities advised by Corvex have as of the date of this presentation beneficial or economic interests in shares or share equivalents of Crown Castle International Corp. (“CCI”) and may have long or short interests or in vestments in the other companies referenced in this presentation. Corve x and its advised funds may buy, sell, increase or decrease their beneficial o r economic exposure to, hedge or otherwise change the form, net position, or substance of, any of its investments related to CCI or such other companies at any time and Corvex may change its views about CCI or the other companies or industries referenced in this presentation at a ny time and without notice to the market or any other person.

The information contained in this presentation is based on publicly available information about CCI and other companies. This presentation include s forwardlooking statements (including statements as to potential future perfo rmance or prices), estimates, projections and opinions prepared with respect to, among other things, CCI and other companies. Such statements, estimates, projections and opinions may prove to be inaccurate and are subject to economic, competitive, financial and other risks and uncertain ties. No representation or warranty, express or implied, is made as to the accuracy or completeness (currently or historically) of those statements, estimates, projections or opinions or any other written or oral communic ation made by or on behalf of Corvex in the presentation or otherwise with respect to CCI, the information contained in the presentation or otherwise. The information contained in this presentation is provided “as is” and, except where otherwise indicated, statements speak as of the date made, and Corvex undertakes no obligation to correct, update or revise those statements or to otherwise provide any additional materials. The statements Corvex makes in this presentation or otherwise are not investment advice o r a recommendation or solicitation to buy or sell any securities.

Corvex Background

Concentrated, value based investing strategy across the capital structure

Focus on investing in high quality, North American businesses undergoing change in industries with positive secular tailwinds

Engage regularly with management teams with goal of developing close long term relationships underpinned by constructive two way dialogue

Long term investment horizon and concentrated portfolio enable us to conduct heavy diligence and focus our full energy on each investment

Knowledge based and experienced approach to partnering with management and other constituents to create shareholder value

Approximately $7 billion of assets under management

Investment Themes

Secular growth in a no growth / low growth world

- Shale gas revolution, mobile data growth, enterprise data growth, proliferation of “screens”

“Infrastructure assets” of the 21 st century

- Recurring revenue businesses critical to modern economies, with high barriers to entry and attractive returns on invested capital

Capitalizing on the disconnect between cost of debt and cost of equity

- M&A

- “Equity shrink” and dividends

Consolidating industries

- Extraordinary growth through synergies and pricing power

Company Overview

Company Overview • Crown Castle International Corp. (“CCI” or the “Company”) is the largest U.S. operator

Crown Castle International Corp. (“CCI” or the “Company”) is the largest U.S. operator of shared wireless infrastructure, including towers, rooftops, small cells, and associated network services

CCI owns or operates nearly 40,000 towers in the U.S., with 56% and 71% of these sites located in the top 50 and top 100 BTAs, respectively

Company’s key customers are Verizon, AT&T, Sprint, and T Mobile

~83% of total revenue and ~90% of gross profit derived from recurring rental payments with longterm leases

CCI owns land underneath sites representing 34% of its gross profit, and leases remaining 66% with weightedaverage maturity of 30 years

Customer contracts (before renewals) represent $22 billion of expected future revenue with weightedaverage life of 7 years as of June 2014

CCI began operating as a REIT for U.S. federal income tax purposes effective January 1, 2014

Tower Industry Overview

A tower is a vertical structure built on a parcel of land to hold communications network equipment such as antennas and base stations

Tower operator leases space to tenant with rental payments structured under long term non cancellable leases (~10 year initial term with multiple ~510 year renewal options), with fixed contractual escalators (~3 4% annually) and low churn (only ~1 2% annually)

A tower is typically built to accommodate multiple tenants (“co location”) - An additional tenant can be added to a tower with minimal capital investment or increase in operating costs - Building a new tower is more expensive and time consuming than leasing from an existing tower, driving shared network infrastructure - Co location drives attractive returns on invested capital and high incremental margins for towers, while strengthening barriers to entry

Industry growth is driven by mobile data growth, network improvements, and new spectrum deployments

Tower Unit Economics

CCI has 41,361 towers with an average of 2.3 tenants per tower today

- 0.1 – 0.2 tenants per tower are added to the tower portfolio each year, driving steady long term growth

 

One

Two

Three

Four

Tenant

Tenants

Tenants

Tenants

Annual Site Rental Revenue Per Tenant per Month

$28,800

$57,600

$86,400

$115,200

$2,400

$2,400

$2,400

$2,400

Annual Operating Expenses Per Site per Month

$18,000

$19,800

$21,600

$23,400

$1,500

$1,650

$1,800

$1,950

Tower Cash Flow % Margin Incremental Margin % Per Site per Month

$10,800

$37,800

$64,800

$91,800

37.5%

65.6%

75.0%

79.7%

--

93.8%

93.8%

93.8%

$900

$3,150

$5,400

$7,650

Unlevered Return on Invested Capital

4.3%

12.6%

18.5%

23.0%

Invested Capital per Tower

$250,000

$300,000

$350,000

$400,000

Source: Company presentations, Corvex estimates. Figures in table above are illustrative. CORVEX MANAGEMENT LP

7

Financial Summary

Financial Summary Tower Count Total Revenue $4,000 40,000 $3,500 14.5% CAGR 8.2% CAGR $3,000 30,000 $2,500
Tower Count Total Revenue $4,000 40,000 $3,500 14.5% CAGR 8.2% CAGR $3,000 30,000 $2,500 $2,000
Tower Count
Total Revenue
$4,000
40,000
$3,500
14.5% CAGR
8.2% CAGR
$3,000
30,000
$2,500
$2,000
20,000
$1,500
$1,000
10,000
$500
$0
2007 2008
2009 2010
2011
2012 2013 2014E
2007 2008
2009 2010
2011
2012 2013 2014E
Adjusted EBITDA
AFFO per Share
$2,500
$4.50
$4.00
$2,000
$3.50
15.6% CAGR
16.9% CAGR
$3.00
$1,500
$2.50
$2.00
$1,000
$1.50
$1.00
$500
$0.50
$0
$0.00
2007 2008
2009 2010
2011
2012 2013 2014E
2007
2008 2009
2010
2011
2012
2013 2014E

Investment Thesis

Investment Thesis • Strong secular growth driven by continued mobile data proliferation • Exceptional business with

Strong secular growth driven by continued mobile data proliferation

Exceptional business with recurring revenues, defensible barriers to entry, attractive returns on invested capital, and a strong customer base

Attractive valuation relative to growth prospects, business quality, tower peers, REITs, potential dividend capacity, and our view of intrinsic value

Earnings power in excess of Street Consensus estimates in our view

Relative laggard over the last year, and still the most contrarian / least wellliked among public peers in our estimation

Essentially all domestic tower portfolio should provide predictability, simplicity, and lower risk

More mature business profile should result in higher capital returns

• CCI offers shareholders attractive risk‐adjusted returns, with steady and predictable secular growth, an
• CCI offers shareholders attractive risk‐adjusted returns, with steady and
predictable secular growth, an inexpensive valuation, and increasing
capital returns

How Could Crown Castle Be Mispriced?

Sprint / TMobile: as largest domestic tower operator and owner of legacy T Mobile tower portfolio, CCI has greatest exposure to consolidation

Interest rates: investor fear that interest rates were about to rise and view that interest rates impact tower valuation multiples or trading momentum

AT&T transaction: in October 2013, CCI acquired a portfolio of towers from AT&T at a relatively high price with generous leasing terms, 83% funded through new common and preferred equity issuance

Investor base: large market capitalization (AMT and CCI are #2 and #3 in IYR, respectively) with niche business model and “GARP” financial profile

Capital allocation: significant component of shareholders’ future returns will be driven by how management allocates capital

- Uncertainty preventing CCI from receiving market valuation reflective of the quality and growth of its cash flows

- Potential Verizon tower sale exacerbating capital allocation overhang

Capital Allocation Overhang

We believe CCI is “betwixt and between” on capital structure and capital allocation strategy today

- De levering the balance sheet while maintaining an artificially low payout ratio doesn’t make sense and is hurting valuation in our view

- Management has committed to ~7080% dividend payout ratio in 3 5 years (20182020), but is leaving behind an optimal leverage ratio today

Discounted valuation and focus on reducing leverage could impair the Company’s ability to grow both near term and long term

- Potential Verizon tower sale makes issue especially critical right now

Underperformance has created frustration and put CCI on the defensive

- Status quo is not working for shareholders

Fortunately, we believe the Company’s issues can be easily fixed

Two Options

CCI faces two clear options in our view: (i) increase its payout ratio, or (ii) increase leverage - While we believe both paths have strong merit, we believe the first option is the best fit for the Company’s current business plans and DNA

Either way, we firmly believe the status quo is inferior to both options and unacceptable

#1: Increase Payout Ratio Quarterly Dividends $4.00+ Dividend / Share 80%+ Payout Ratio 10%+ LT

#1: Increase Payout Ratio

Quarterly Dividends $4.00+ Dividend / Share 80%+ Payout Ratio 10%+ LT Dividend Growth Maintain ~4.5x Leverage Flex to ~6.0x for M&A Target Investment Grade Organic Growth and M&A Valued on Dividend Yield

#2: Increase Leverage

Ongoing Buybacks $1.60+ Dividend / Share 30% Payout Ratio 15%+ LT Dividend Growth Maintain ~7.0x Leverage Flex to ~7.5x for M&A Non Investment Grade Organic Growth and M&A Valued on AFFO / Share

Flex to ~7.5x for M&A Non ‐ Investment Grade Organic Growth and M&A Valued on AFFO
Flex to ~7.5x for M&A Non ‐ Investment Grade Organic Growth and M&A Valued on AFFO
Flex to ~7.5x for M&A Non ‐ Investment Grade Organic Growth and M&A Valued on AFFO
Flex to ~7.5x for M&A Non ‐ Investment Grade Organic Growth and M&A Valued on AFFO
Flex to ~7.5x for M&A Non ‐ Investment Grade Organic Growth and M&A Valued on AFFO

What Have We Done So Far?

Corvex funds currently have beneficial or economic ownership of approximately 12.6 million shares and share equivalents of Crown Castle

- Represents approximately $1 billion of economic exposure at current market prices

We recently met with management, continuing the productive dialogue we have had with the Company for several years

- As background, we have invested in and followed CCI and its tower peers since the inception of Corvex in 2011

On October 14, 2014, we released a letter and presentation to fellow CCI shareholders outlining a proposal to improve the Company’s capital allocation strategy and strengthen its valuation

- Given recent press suggesting Verizon towers sale could be imminent, we felt compelled to reach out to fellow shareholders publicly

- These materials available publicly at www.CorvexCCIpresentation.com

What Have We Done So Far? (cont’d)

Company has stated it plans to address its capital allocation policy, including dividends, on its 3 rd quarter earnings call (October 31, 2014)

- Management regularly solicits input from us and other shareholders

- We believe the management team is thoughtful and wants to get to the right answer

We plan to continue to engage with the Company and our fellow shareholders

- We believe our proposal creates significant long term value for owners, and we will continue to try to persuade key stakeholders of this view

- Responsibility of the Company to embrace change or provide shareholders with a clear path to a superior alternative

While we have a high degree of conviction in our plan, we remain open to any ideas which can be shown to further enhance this proposal or credibly demonstrate superior returns over a similar period of time

New Dividend Policy is the Missing Link

We believe CCI should “close the circle” for shareholders by increasing its dividend payout ratio

We model approximately 25% upside to CCI’s recent share price through a change in capital allocation, and potential for over 60% upside in 15 months including dividends

for over 60% upside in 15 months including dividends Steady Dividends w/ High Payout Ratio Recommendations:
Steady Dividends w/ High Payout Ratio
Steady
Dividends w/
High Payout
Ratio
Recommendations: 1. Pay a dividend of at least $4.00 per share in 2015 2. Guide
Recommendations:
1. Pay a dividend of at least $4.00
per share in 2015
2. Guide to 10%+ dividend per
share growth over next 3+ years
3. Plan to maintain leverage of 4.5x
and target an investment grade
rating over time
4. Flex leverage up to 6.0x for
accretive M&A
5. De‐ lever back to 4.5x following
M&A thru EBITDA growth

Risk

Adjusted

Returns

M&A thru EBITDA growth Risk ‐ Adjusted Returns Target Investment Grade Rating U.S. Only Towers REIT
M&A thru EBITDA growth Risk ‐ Adjusted Returns Target Investment Grade Rating U.S. Only Towers REIT

Target

Investment

Grade

Rating

U.S. Only

Towers

Returns Target Investment Grade Rating U.S. Only Towers REIT Election Note: Returns based on share prices
Returns Target Investment Grade Rating U.S. Only Towers REIT Election Note: Returns based on share prices

REIT

Election

Note: Returns based on share prices as of October 17, 2014 unless otherwise noted. CORVEX MANAGEMENT LP

15

Dividend Policy Recommendations

Pay a dividend of at least $4.00 per share in 2015

- Equates to a payout ratio of ~80% of AFFO (over 1.20x Coverage), or ~70% of free cash flow after maintenance capex given cash flow benefit of prepaid rents which are straightlined in reported AFFO

Guide to 10% or higher dividend per share growth over the next 3+ years

Plan to maintain leverage of approximately 4.5x net debt / EBITDA on an ongoing basis and target an investment grade credit rating over time

Flex leverage up to 6.0x net debt / EBITDA for M&A (including potential Verizon transaction), if deal is accretive to the standalone dividend plan

- De lever back to 4.5x following M&A through EBITDA growth (maintain 80% 90% payout ratio over time including periods following M&A)

We do not believe this capital allocation scenario would materially reduce operating flexibility or increase CCI’s risk profile – minimal execution risk in our view

80% AFFO Payout Scenario (1.20x Coverage)

We believe CCI could conservatively trade at a 4.0% dividend yield in this scenario, reducing cost of capital and driving approx. 25% upside to recent CCI share price

Over time, we believe the Company should trade below a 4.0% yield as new investors become familiar with the CCI story, driving additional upside for long term owners

80% AFFO Payout AFFO AFFO / Share % Growth Net Debt / LTM EBITDA

2015E

2016E

2017E

2018E

$1,630

$1,823

$1,963

$2,090

$4.99

$5.58

$6.09

$6.63

17.4%

11.9%

9.0%

9.0%

4.9x

4.5x

4.5x

4.5x

Dividend / Share % Growth Dividend Yield on Recent Coverage Ratio (AFFO) Payout Ratio (AFFO)

$4.00

$4.50

$5.20

$5.75

185.7%

12.5%

15.6%

10.6%

4.9%

5.6%

6.4%

7.1%

1.2x

1.2x

1.2x

1.2x

80%

81%

85%

87%

CCI Price @ Yield:

2015E

2016E

2017E

2018E

 

3.00%

$133.33

$150.00

$173.33

$191.67

3.50%

$114.29

$128.57

$148.57

$164.29

4.00%

$100.00

$112.50

$130.00

$143.75

4.50%

$88.89

$100.00

$115.56

$127.78

5.00%

$80.00

$90.00

$104.00

$115.00

Price % Change:

 
 

3.00%

64.9%

85.6%

114.4%

137.1%

3.50%

41.4%

59.0%

83.8%

103.2%

4.00%

23.7%

39.2%

60.8%

77.8%

4.50%

10.0%

23.7%

42.9%

58.1%

5.00%

(1.0%)

11.3%

28.6%

42.3%

Note: We believe CCI will earn approximately $5.00 per share of AFFO in 2015, although we expect the Company to guide more conservatively than this figure on its 3Q14 earnings call based on past practice. Stock prices and price percentage change in tables above do not include dividends received. We believe operating results can likely exceed the long term projections above through new spectrum deployments not explicitly modeled here. CORVEX MANAGEMENT LP

17

90% AFFO Payout Scenario (1.10x Coverage)

While CCI may begin at a lower payout ratio as shown on previous page, we believe the optimal long term policy is 1.10x Coverage of AFFO

Equates to payout ratio of ~90% of AFFO, or ~80% of FCF after maint. capex given cash flow benefit of prepaid rents

1.10x Coverage scenario drives nearly 40% upside at a 4.0% dividend yield

1.10x Coverage AFFO AFFO / Share

2015E

2016E

2017E

2018E

$1,626

$1,812

$1,955

$2,089

$4.98

$5.55

$6.02

$6.53

%

Growth

17.1%

11.4%

8.5%

8.5%

Net Debt / LTM EBITDA

5.0x

4.6x

4.5x

4.5x

Dividend / Share

$4.50

$5.00

$5.50

$6.00

%

Growth

221.4%

11.1%

10.0%

9.1%

Dividend Yield on Recent Coverage Ratio (AFFO) Payout Ratio (AFFO)

5.6%

6.2%

6.8%

7.4%

1.1x

1.1x

1.1x

1.1x

90%

90%

91%

92%

CCI Price @ Yield:

2015E

2016E

2017E

2018E

 

3.00%

$150.00

$166.67

$183.33

$200.00

3.50%

$128.57

$142.86

$157.14

$171.43

4.00%

$112.50

$125.00

$137.50

$150.00

4.50%

$100.00

$111.11

$122.22

$133.33

5.00%

$90.00

$100.00

$110.00

$120.00

Price % Change:

 
 

3.00%

85.6%

106.2%

126.8%

147.4%

3.50%

59.0%

76.7%

94.4%

112.1%

4.00%

39.2%

54.6%

70.1%

85.6%

4.50%

23.7%

37.4%

51.2%

64.9%

5.00%

11.3%

23.7%

36.1%

48.4%

Note: We believe CCI will earn approximately $5.00 per share of AFFO in 2015, although we expect the Company to guide more conservatively than this figure on its 3Q14 earnings call based on past practice. Stock prices and price percentage change in tables above do not include dividends received. We believe operating results can likely exceed the long term projections above through new spectrum deployments not explicitly modeled here. CORVEX MANAGEMENT LP

18

Comparable Companies

Dividend paying companies across a range of industries suggest CCI should trade below a 4.0% yield, implying at least 24% 39% upside

7.0%

6.0%

5.0%

4.0%

3.0%

2.0%

1.0%

7.1% 2015E Dividend Yield 5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1%
7.1%
2015E Dividend Yield
5.6%
5.5%
5.0%
5.0%
4.9%
4.1%
4.0%
3.8%
2.3%
2.1%
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex
5.6% 5.5% 5.0% 5.0% 4.9% 4.1% 4.0% 3.8% 2.3% 2.1% Source: Bloomberg, Wall Street research, Corvex

Source: Bloomberg, Wall Street research, Corvex estimates. CCI based on Corvex estimates. CORVEX MANAGEMENT LP

19

Comparable Companies (cont’d)

Clear disconnect in our view between the growth, valuation, and stability of pro forma CCI relative to other dividend paying companies

2014E2016E Earnings / AFFO CAGR (X) vs. 2015E Dividend Yield (Y)

Wireline 7.00% 6.50% R² = 0.58 PF CCI 6.00% (current) 5.50% Outdoor REITs 5.00% Wireless
Wireline
7.00%
6.50%
R² = 0.58
PF CCI
6.00%
(current)
5.50%
Outdoor REITs
5.00%
Wireless
Data Center REITs
4.50%
PF CCI
@ 4.0%
REITs (IYR)
4.00%
Utilities
Energy GPs
3.50%
3.00%

(7.0%)

(2.0%)

3.0%

8.0%

13.0%

18.0%

Source: Bloomberg, Wall Street research, Corvex estimates. CCI based on Corvex estimates. PF CCI dividend yields shown assumes 2015E dividend of $4.50 per share.

Comparable Companies (cont’d)

Comparable dividend paying companies suggest CCI’s dividend yield should compress below 4.0% over time

2014E2016E Earnings / AFFO CAGR (X) vs. 2015E Dividend Yield (Y)

9.00% WIN 8.00% 7.00% R² = 0.85 FTR PF CCI 6.00% LAMR (current) DFT CTL
9.00%
WIN
8.00%
7.00%
R² = 0.85
FTR
PF CCI
6.00%
LAMR
(current)
DFT
CTL
T
DLR
CBSO
5.00%
VZ
PF CCI
4.00%
CONE
@ 4.0%
3.00%
(18.0%)
(13.0%)
(8.0%)
(3.0%)
2.0%
7.0%
12.0%
17.0%

Source: Bloomberg, Wall Street research, Corvex estimates. CCI based on Corvex estimates. PF CCI dividend yields shown assumes 2015E dividend of $4.50 per share.

Comparable Companies (cont’d)

1.10x Coverage scenario would place CCI #9 in the S&P 500 in terms of dividend yield (or #14 in 80% AFFO Payout scenario) – a severe valuation disconnect which simply could not persist in our view

10.0%

8.0%

6.0%

4.0%

2.0%

0.0%

Highest NTM Dividend Yield (S&P 500)

10.1% 8.8% 8.7% 7.4% 7.4% 7.0% 6.1% 5.7% 5.6% 5.3% 5.3%
10.1%
8.8%
8.7%
7.4%
7.4%
7.0%
6.1%
5.7%
5.6%
5.3%
5.3%
8.8% 8.7% 7.4% 7.4% 7.0% 6.1% 5.7% 5.6% 5.3% 5.3% Source: Bloomberg as of September 30,
8.8% 8.7% 7.4% 7.4% 7.0% 6.1% 5.7% 5.6% 5.3% 5.3% Source: Bloomberg as of September 30,
8.8% 8.7% 7.4% 7.4% 7.0% 6.1% 5.7% 5.6% 5.3% 5.3% Source: Bloomberg as of September 30,
8.8% 8.7% 7.4% 7.4% 7.0% 6.1% 5.7% 5.6% 5.3% 5.3% Source: Bloomberg as of September 30,
8.8% 8.7% 7.4% 7.4% 7.0% 6.1% 5.7% 5.6% 5.3% 5.3% Source: Bloomberg as of September 30,

Source: Bloomberg as of September 30, 2014. CORVEX MANAGEMENT LP

22

Attractive Absolute Valuation

To be clear, we believe CCI is significantly undervalued on an absolute basis, and not simply relative to dividend paying companies across a range of industries

- We view a change in the Company’s dividend payout ratio as a catalyst for narrowing its discount to intrinsic value and peer trading multiples

- While some “yield stocks” may be overvalued today due to the current low interest rate environment (i.e., stocks with high yields but limited growth or even declining businesses), we believe investor demand for high cash returns and double digit dividend growth will remain strong for the foreseeable future

- High dividend payout ratio simply forces the market to value CCI’s strong cash flows and growth, while also reducing the overhang of capital allocation uncertainty

Attractive RiskAdjusted Returns

A dividend discount model shows how simple and compelling an investment in CCI is with a high payout ratio Strong downside protection:

exit at market multiple P/E of CCI’s dividend (which therefore gives zero credit for cash flow in excess of dividend or future returns from growth capex) still results in a 5% IRR over 3 years In model to lose money over 3 years, need to exit below a 12.8x multiple of dividend per share (i.e., 7.8% dividend yield)

80% AFFO Dividend / Share % Growth

2014E

2015E

2016E

2017E

$1.40

$4.00

$4.50

$5.20

--

185.7%

12.5%

15.6%

 

3

Year

Stock

Price +

 

IRR

Price

Dividends

 

3.00%

31.2%

$173.33

$187.73

3.50%

25.5%

$148.57

$162.97

2017E

4.00%

20.8%

$130.00

$144.40

Exit

4.50%

16.8%

$115.56

$129.96

Yield

5.00%

13.3%

$104.00

$118.40

15.0x

4.5%

$78.00

$92.40

12.8x

 

0.0%

$66.44

$80.84

1.10x & VZ Deal:

2014E

2015E

2016E

2017E

Dividend / Share % Growth

$1.40

$4.60

$5.20

$5.75

--

228.6%

13.0%

10.6%

 

3

Year

Stock

Price +

 

IRR

Price

Dividends

 

3.00%

35.7%

$191.67

$207.92

3.50%

29.8%

$164.29

$180.54

2017E

4.00%

24.9%

$143.75

$160.00

Exit

4.50%

20.8%

$127.78

$144.03

Yield

5.00%

17.3%

$115.00

$131.25

15.0x

 

8.2%

$86.25

$102.50

11.2x

0.0%

$64.59

$80.84

Interest Rate Sensitivity

• Minimal correlation between multiples and interest rates over last 10 years; towers traded at
• Minimal correlation between multiples and interest rates over last 10
years; towers traded at 20‐24x EBITDA with rates over 200bps higher
Towers Avg. EV / NTM EBITDA (LHS) vs. U.S. 10 Year Yield (RHS)
24.0x
5.50
5.00
22.0x
4.50
20.0x
4.00
R² = 0.15
18.0x
3.50
3.00
16.0x
2.50
14.0x
2.00
12.0x
1.50
10.0x
1.00
Apr ‐05
Apr ‐06
Apr ‐07
Apr ‐08
Apr ‐09
Apr ‐10
Apr ‐11
Apr ‐12
Apr ‐13
Apr ‐14
Towers EV/EBITDA
U.S. 10 ‐ Yr. Yield

Source: Bloomberg. CORVEX MANAGEMENT LP

25

Investor Base Discussion

We believe CCI can be more successful attracting yieldoriented investors to its shareholder base than it has been at attracting “traditional” REIT investors

There are several obstacles to traditional REIT investors investing in tower REITs, including: (i) key benchmark REIT indices, (ii) perceived technology risk, (iii) limited alternative use for land and equipment, and (iv) no net asset value (“NAV”) reference metric

In contrast to REIT investors, we believe the key requirements for yieldoriented investors are relatively straightforward: stability and growth of dividends

• We believe a sizable dividend backed by the credit quality of America’s largest wireless
• We believe a sizable dividend backed by the credit quality of America’s
largest wireless operators in a business with one of the brightest areas of
growth within the telecom sector will be incredibly well received by
yield‐oriented investors

Highly Unique Equity Security

Simply put, we are not aware of any other security in the public markets with pro forma CCI’s unique combination of growth, value, stability and yield

unique combination of growth, value, stability and yield Investment Attributes Growth Value Stability Capital

Investment

Attributes

growth, value, stability and yield Investment Attributes Growth Value Stability Capital Returns CORVEX MANAGEMENT LP
Growth

Growth

Growth
Growth
Value

Value

Value
Value
Stability
Stability
Capital Returns
Capital
Returns
value, stability and yield Investment Attributes Growth Value Stability Capital Returns CORVEX MANAGEMENT LP 27

RePackaged U.S. Wireless Credit Risk

With a high payout ratio, CCI becomes a growing, pure play passthrough of re packaged U.S. wireless credit risk , structured in a tax advantaged REIT

6.00%

5.00%

4.00%

3.00%

2.00%

1.00%

0.00%

Cost of Debt (after‐ tax, except HY) 5.11% 3.91% 3.84% 2.62% 2.60% Verizon AT&T Sprint
Cost of Debt
(after‐ tax, except HY)
5.11%
3.91%
3.84%
2.62%
2.60%
Verizon
AT&T
Sprint
T ‐Mobile High Yield Index

Source: Bloomberg, company filings. Aftertax cost of debt assumes 38.0% normalized tax rate. High yield index shown pretax. CORVEX MANAGEMENT LP

28

Payout Ratio Discussion

High payout ratio maximizes share price, lowers cost of capital, and allows for higher long term growth in our view

High payout ratio will not impact ongoing growth investments or rely on the capital markets in our view

~70% ~90% $3.50 Dividend Payout Spectrum $4.50 (+) (–) (+) (–) Greater capital allocation flexibility;
~70%
~90%
$3.50
Dividend Payout Spectrum
$4.50
(+)
(–)
(+)
(–)
Greater capital
allocation
flexibility;
potential to
drive higher
dividend growth
through
increases in
payout ratio
Unlikely to
maximize cost of
capital; yield
investors may not
give credit for
dividend growth in
above ~10%;
capital markets
still required for
large M&A
Maximizes metric likely
to drive valuation and
cost of capital; creates
higher predictability of
returns; increases
appeal to yield and
REIT investors; should
not limit growth capex;
maximizes value of IG
credit rating
Limits
management’s
flexibility among
capital allocation
options; may
require capital
markets if capex
growth
accelerates (e.g.,
small cells)

Payout Ratio Discussion (cont’d)

Discretionary investment capacity includes (i) AFFO (i.e., cash flow after maintenance capex), (ii) prepaid rent, and (iii) the leverage capacity created by EBITDA growth at a constant leverage ratio

Even in a downside case of only 6.0% EBITDA growth, CCI would have $767$930mm to invest in Growth CapEx at a 80%90% AFFO payout ratio, compared to 2014 spending of $650mm

 

Downside

Corvex

Upside

2014E Adjusted EBITDA 2015E Adjusted EBITDA % Growth y-o-y

$2,115

$2,115

$2,115

$2,242

$2,297

$2,327

6.0%

8.6%

10.0%

$ EBITDA Growth y-o-y Target IG Leverage Ratio

$127

$182

$212

4.50x

4.50x

4.50x

2015E Leverage

Capacity Created

$571

$820

$952

2015E Leverage

Capacity Created

$571

$820

$952

2015E AFFO 2015E Prepaid Rents

$1,500

$1,626

$1,675

$165

$200

$235

Total 2015E Investment Capacity

$2,236

$2,646

$2,862

Total 2015E Investment Capacity 2015E Dividend @ 90% AFFO

$2,236

$2,646

$2,862

$1,469

$1,469

$1,469

Available for Growth CapEx

$767

$1,177

$1,392

%

of 2014E Growth CapEx

118%

181%

214%

Memo: 2014E Growth CapEx

$650

$650

$650

Total 2015E Investment Capacity 2015E Dividend @ 80% AFFO

$2,236

$2,646

$2,862

$1,306

$1,306

$1,306

Available for Growth CapEx

$930

$1,340

$1,556

%

of 2014E Growth CapEx

143%

206%

239%

Memo: 2014E Growth CapEx

$650

$650

$650

Note: 2014E EBITDA and 2014E Growth CapEx shown here are at the high end of the Company's Guidance range as of 2Q14 earnings call.

Payout Ratio Discussion (cont’d)

While we understand practice of “under promising and over delivering,” setting dividend policy based on overly conservative projections could result in CCI capturing a limited portion of the available upside - In theory, conservative projections imply excess coverage and therefore stock should trade at a lower dividend yield all else equal – in practice the market may or may not give such valuation credit

We would suggest a fixed payout ratio on realized AFFO per share with a 4 th quarter true up in order to maximize shareholder value

2015E AFFO / Share AFFO Payout Ratio 2015E Dividend / Share Payout Ratio incl. Prepaid Rents

$4.50

$4.60

$4.70

$4.80

$4.90

$5.00

$5.10

$5.20

$5.30

80%

80%

80%

80%

80%

80%

80%

80%

80%

$3.60

$3.68

$3.76

$3.84

$3.92

$4.00

$4.08

$4.16

$4.24

70%

71%

71%

71%

71%

71%

71%

72%

72%

CCI Price @ 4.0% Dividend Yield CCI Price @ 3.5% Dividend Yield CCI Price @ 3.0% Dividend Yield

$90.00

$92.00

$94.00

$96.00

$98.00

$100.00

$102.00

$104.00

$106.00

$102.86

$105.14

$107.43

$109.71

$112.00

$114.29

$116.57

$118.86

$121.14

$120.00

$122.67

$125.33

$128.00

$130.67

$133.33

$136.00

$138.67

$141.33

% Change @ 4.0% Dividend Yield % Change @ 3.5% Dividend Yield % Change @ 3.0% Dividend Yield

11.3%

13.8%

16.3%

18.8%

21.2%

23.7%

26.2%

28.6%

31.1%

27.2%

30.1%

32.9%

35.7%

38.5%

41.4%

44.2%

47.0%

49.9%

48.4%

51.7%

55.0%

58.3%

61.6%

64.9%

68.2%

71.5%

74.8%

Conclusion

We believe CCI offers shareholders strong secular growth, an exceptional business model, an attractive valuation, and earnings power in excess of Consensus estimates

However, CCI is “betwixt and between” on capital structure and capital allocation today, and we believe this overhang has largely led to CCI’s discount and its underperformance - We believe CCI faces two clear solutions: (i) increase its payout ratio, or (ii) increase leverage

We recommend in part that CCI: (i) pay a dividend of at least $4.00 per share in 2015, (ii) guide to 10% or higher dividend per share growth over the next 3+ years, and (iii) plan to maintain leverage of approximately 4.5x net debt / EBITDA to target an investment grade credit rating over time

• Our analysis suggests approximately 25% near ‐ term upside, and the potential for over
• Our analysis suggests approximately 25% near ‐ term upside, and the
potential for over 60% upside in 15 months including dividends received
• We believe it is the responsibility of the Company to embrace change
now or provide shareholders with a clear path to a superior alternative

APPENDIX

Mobile Data Growth

Wireless carriers must continue to invest in their networks and/or deploy additional spectrum in order to satisfy rapid mobile data growth

3,500,000 North America Mobile Data Traffic Forecast (TB per Month) 3,000,000 2,500,000 2,000,000 50% CAGR
3,500,000
North America Mobile Data Traffic Forecast
(TB per Month)
3,000,000
2,500,000
2,000,000
50% CAGR
1,500,000
1,000,000
500,000
0
2013
2014
2015
2016
2017
2018

Source: Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, 2013 2018. CORVEX MANAGEMENT LP

34

Mobile Data Growth (cont’d)

Smartphones are the primary driver of mobile data growth in the U.S. and globally, although newer connected devices are growing even faster

12,000,000

10,000,000

8,000,000

6,000,000

4,000,000

2,000,000

0

Global Mobile Data Traffic by Device Type (TB per Month) '13-'18E '13 % '18E %
Global Mobile Data Traffic by Device Type
(TB per Month)
'13-'18E
'13 %
'18E %
CAGR
of Total
of Total
Smartphones
63%
62%
66%
Tablets
87%
9%
18%
Laptops
30%
25%
9%
M2M
113%
1%
6%
All Other
27%
3%
1%
2013
2014
2015
2016
2017
2018
Smartphones
Tablets
Laptops
M2M

Source: Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, 2013 2018. CORVEX MANAGEMENT LP

35

Mobile Data Growth (cont’d)

As smartphone penetration growth begins to slow in the U.S., increased data consumption per device continues to drive massive mobile data growth

A 4G connection currently drives almost 15x the traffic of earlier wireless technologies

Higher speeds are believed to drive the adoption and usage of high end devices as well as more bandwidth intensive applications, including mobile video

bandwidth intensive applications, including mobile video Source: Cisco Visual Networking Index: Global Mobile

Source: Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, 2013 2018. CORVEX MANAGEMENT LP

36

Mobile Data Growth (cont’d)

Mobile Data Growth (cont’d) Source: Sandvine “1H 2014 Global Internet Phenomena Report.” CORVEX MANAGEMENT

Source: Sandvine “1H 2014 Global Internet Phenomena Report.” CORVEX MANAGEMENT LP

37

Exceptional Business Model

Attractive secular growth profile with visible long term drivers (e.g., mobile data growth, new spectrum deployments) and multiyear runway for continued growth

Steady, recurring revenues structured under longterm, non cancellable leases with contractual escalators and low churn

Attractive returns on invested capital and high barriers to entry driven by co location model, locationbased scarcity and zoning restrictions, network effects, capital requirements and time to market

Well capitalized, creditworthy customer base – CCI cash flows essentially represent pass through of U.S. wireless credit risk for critical network payments (cash flows arguably senior to even wireless debt)

Strong financial profile with consistent growth, high free cash flow conversion, high incremental margins, limited maintenance capex requirements, and attractive tax profile via REIT structure

Valuation Comparison

CCI’s trades at a ~1.5x 2.0x discount to peers on Consensus 2014E AFFO per share, and a ~1.0x discount on Consensus 2015E AFFO per share

CCI’s valuation discount has narrowed recently due in part to investor enthusiasm around a significant dividend increase in our view

Consensus AFFO / Share Multiples

22.0x

21.0x

20.0x

19.0x

18.0x

17.0x

16.0x

15.0x

14.0x

13.0x

12.0x

Source: Bloomberg. CORVEX MANAGEMENT LP

21.3x 20.7x 19.5x 18.1x 18.0x 16.9x CCI AMT SBAC 2014E 2015E
21.3x
20.7x
19.5x
18.1x
18.0x
16.9x
CCI
AMT
SBAC
2014E
2015E

39

Embrace Future Today

“As we discussed previously, over the next five years we expect to increase our dividend per share by at least 15% annually. We currently have a net operating loss balance, or NOL, of approximately $2 billion, which we would expect to utilize prior to 2020. We expect that once the NOLs are exhausted, our dividend payout as a percentage of AFFO will increase from the approximately 30% today to something in the area of 70% to 80%, which implies a compound annual growth rate of our dividend in excess of 20% over this period of time.” CFO Jay Brown, 2Q14 Earnings Call

We believe CCI should embrace its previously communicated payout structure now rather than artificially deferring it to 2018 2020 - All this practice does is artificially defer stock price performance - Payout structure should not hinder growth investments – logic around using NOLs to drive growth or pre tax returns appears hazy to us - Go on offensive with equity currency trading at higher multiple

Reduce Cost of Capital

Potential Verizon tower sale should be an additional catalyst for CCI to change its capital allocation plan now, strengthening its equity currency in front of a possible transaction

28.0x

26.0x

24.0x

22.0x

20.0x

18.0x

16.0x

14.0x

12.0x

10.0x

U.S. Tower Precedent Transactions

25.6x 21.3x 21.0x 18.5x 17.7x 17.7x 15.7x 15.4x 14.8x
25.6x
21.3x
21.0x
18.5x
17.7x
17.7x
15.7x
15.4x
14.8x
21.3x 21.0x 18.5x 17.7x 17.7x 15.7x 15.4x 14.8x Source: Company filings and press releases, Wall

Source: Company filings and press releases, Wall Street research, Corvex estimates. Multiples represent EV / EBITDA. CORVEX MANAGEMENT LP

41

Organic Site Rental Revenue Growth

CCI’s organic growth (~7.7%) is similar to AMT (~7.9% domestic) after adjusting for one time items and accounting differences

14.0%

12.0%

10.0%

8.0%

6.0%

4.0%

2.0%

0.0%

2014E Domestic Organic Revenue Growth Guidance

13.2% 11.6% 10.0% 9.4% 9.3% 9.0% 7.9% 7.7% 6.4% CCI Reported Growth % AMT Adjusted
13.2%
11.6%
10.0%
9.4%
9.3%
9.0%
7.9%
7.7%
6.4%
CCI
Reported Growth %
AMT
Adjusted Growth %
SBAC
Adjusted Growth % before Churn

Source: Company filings, Wall Street research, Corvex estimates. CORVEX MANAGEMENT LP

42