sbac-20220930x10q

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 September 30, 2022

¨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 (561) 995-7670

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: 107,965,538 shares of Class A common stock as of October 25, 2022.

PART I – FINANCIAL INFORMATION

ITEM 1: FINANCIAL STATEMENTS

SBA COMMUNICATIONS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (in thousands, except par values)



	September 30,		December 31,
	2022		2021
ASSETS	(unaudited)
Current assets:
Cash and cash equivalents	$	201,211	$	367,278
Restricted cash		75,166		65,561
Accounts receivable, net		116,966		101,950
Costs and estimated earnings in excess of billings on uncompleted contracts		81,665		48,844
Prepaid expenses and other current assets		54,805		30,813
Total current assets		529,813		614,446
Property and equipment, net		2,658,366		2,575,487
Intangible assets, net		2,701,939		2,803,247
Operating lease right-of-use assets, net		2,325,009		2,268,470
Acquired and other right-of-use assets, net		989,685		964,405
Other assets		744,202		575,644
Total assets	$	9,949,014	$	9,801,699
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS,
AND SHAREHOLDERS' DEFICIT
Current Liabilities:
Accounts payable	$	51,314	$	34,066
Accrued expenses		96,176		68,070
Current maturities of long-term debt		663,181		24,000
Deferred revenue		216,927		184,380
Accrued interest		25,106		49,096
Current lease liabilities		255,609		238,497
Other current liabilities		30,066		18,222
Total current liabilities		1,338,379		616,331
Long-term liabilities:
Long-term debt, net		11,696,068		12,278,694
Long-term lease liabilities		2,017,760		1,981,353
Other long-term liabilities		221,022		191,475
Total long-term liabilities		13,934,850		14,451,522
Redeemable noncontrolling interests		40,615		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, 107,964 shares and
108,956 shares issued and outstanding at September 30, 2022 and December 31, 2021,
respectively		1,080		1,089
Additional paid-in capital		2,756,215		2,681,347
Accumulated deficit		(7,508,231)		(7,203,531)
Accumulated other comprehensive loss, net		(613,894)		(762,309)
Total shareholders' deficit		(5,364,830)		(5,283,404)
Total liabilities, redeemable noncontrolling interests, and shareholders' deficit	$	9,949,014	$	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 nine months
	ended September 30,				ended September 30,
	2022		2021		2022		2021

Revenues:
Site leasing	$	587,302	$	535,492	$	1,726,967	$	1,564,814
Site development		88,282		53,813		220,393		148,882
Total revenues		675,584		589,305		1,947,360		1,713,696
Operating expenses:
Cost of revenues (exclusive of depreciation, accretion,
and amortization shown below):
Cost of site leasing		112,013		98,666		330,682		289,510
Cost of site development		65,540		41,357		165,809		116,172
Selling, general, and administrative expenses ⁽¹⁾		65,843		51,000		191,241		156,546
Acquisition and new business initiatives related
adjustments and expenses		6,844		5,730		18,776		17,525
Asset impairment and decommission costs		8,532		9,860		25,565		18,560
Depreciation, accretion, and amortization		173,825		170,916		524,541		530,266
Total operating expenses		432,597		377,529		1,256,614		1,128,579
Operating income		242,987		211,776		690,746		585,117
Other income (expense):
Interest income		2,858		945		6,878		2,124
Interest expense		(86,961)		(89,199)		(253,528)		(269,839)
Non-cash interest expense		(11,528)		(11,820)		(34,582)		(35,436)
Amortization of deferred financing fees		(4,955)		(4,934)		(14,758)		(14,690)
Loss from extinguishment of debt, net		—		—		—		(13,672)
Other (expense) income, net		(39,756)		(69,804)		2,262		(49,390)
Total other expense net		(140,342)		(174,812)		(293,728)		(380,903)
Income before income taxes		102,645		36,964		397,018		204,214
(Provision) benefit for income taxes		(2,883)		10,834		(39,797)		(15,494)
Net income		99,762		47,798		357,221		188,720
Net loss attributable to noncontrolling interests		247		—		929		—
Net income attributable to SBA Communications
Corporation	$	100,009	$	47,798	$	358,150	$	188,720
Net income per common share attributable to SBA
Communications Corporation:
Basic	$	0.93	$	0.44	$	3.32	$	1.72
Diluted	$	0.91	$	0.43	$	3.27	$	1.70
Weighted average number of common shares
Basic		107,916		109,577		107,950		109,487
Diluted		109,358		111,565		109,416		111,329

(1)Includes non-cash compensation of $24,945 and $16,589 for the three months ended September 30, 2022 and 2021, respectively, and $72,309 and $57,249 for the nine months ended September 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 nine months
	ended September 30,				ended September 30,

	2022		2021		2022		2021

Net income	$	99,762	$	47,798	$	357,221	$	188,720
Adjustments related to interest rate swaps		53,336		9,898		162,491		58,251
Foreign currency translation adjustments		(40,757)		(51,415)		(14,277)		(31,181)
Comprehensive income		112,341		6,281		505,435		215,790
Comprehensive loss attributable to noncontrolling interests		247		—		1,130		—
Comprehensive income attributable to SBA
Communications Corporation	$	112,588	$	6,281	$	506,565	$	215,790

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, June 30, 2022	107,872	$	1,079	$	2,717,963	$	(7,531,180)	$	(626,473)	$	(5,438,611)
Net income attributable to SBA
Communications Corporation	—		—		—		100,009		—		100,009
Common stock issued in connection with equity
awards and stock purchase plans, offset
by the impact of net share settlements	92		1		13,221		—		—		13,222
Non-cash stock compensation	—		—		26,017		—		—		26,017
Adjustments related to interest rate swaps	—		—		—		—		53,336		53,336
Foreign currency translation adjustments
attributable to SBA Communications



		Page
PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements
	Consolidated Balance Sheets as of September 30, 2022 (unaudited) and December 31, 2021	1
	Consolidated Statements of Operations (unaudited) for the three and nine months ended September 30, 2022 and 2021	2
	Consolidated Statements of Comprehensive Income (unaudited) for the three and nine months ended September 30, 2022 and 2021	3
	Consolidated Statement of Shareholders’ Deficit (unaudited) for the three and nine months ended September 30, 2022 and 2021	4
	Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 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