RADI Radius Global Infrastructure Inc

Revenue Increased 35% YoY

Radius Global Infrastructure, Inc. (Nasdaq: RADI) (“Radius” or the “Company”), one of the largest international owners and acquirors of real property interests and contractual rights underlying essential digital infrastructure assets, today reported financial results for the quarter ended March 31, 2023.

Bill Berkman, Co-Chairman and CEO of Radius Global Infrastructure, commented:

“We generated quarterly revenue of $41.2 million in the first quarter of 2023, up 35% from the first quarter of 2022, with gross profit increasing to $39.3 million, up 32% year-over-year. In the first quarter, our Annualized In-Place Rents increased by 32% to $165.8 million. Our revenues are primarily triple net, inflation-linked rents underlying mission-critical communications sites. In the first quarter of 2023, we acquired 186 communication sites through cash investments in real property interests and related intangible assets of $43.7 million, resulting in Acquisition Capex1 of $48.2 milion, which generated $3.7 million of annual rent. As of March 31, 2023, Radius has approximately $296.5 million of total cash and cash equivalents, restricted cash (including long-term restricted cash), and short-term investments.

RECENTLY ANNOUNCED TRANSACTION

As previously announced on March 1, 2023, Radius entered into a definitive agreement under which EQT Active Core Infrastructure (“EQT”) and the Public Sector Pension Investment Board (“PSP”), through certain of their controlled affiliates, will acquire the Company. This pending transaction is expected to close in the third quarter of 2023, subject to the satisfaction of certain closing conditions. For additional information relating to this pending transaction, please refer to the preliminary proxy statement on Schedule 14A filed with the Securities and Exchange Commission (the “SEC”) on April 7, 2023 and other relevant materials that the Company has filed and may file with the SEC in connection with this pending transaction.

QUARTERLY RESULTS

Revenue increased 35% to $41.2 million for the three months ended March 31, 2023, as compared to revenue of $30.6 million for the three months ended March 31, 2022. The increase was primarily attributable to the additional revenue streams acquired through investments in real property interests made during the past quarter, adjusted for foreign exchange rate effects.

Gross Profit rose 32% to $39.3 million during the three months ended March 31, 2023, as compared to gross profit of $29.8 million in the corresponding prior year period, reflecting a gross profit (which we also refer to as ground cash flow) margin of approximately 95% during the three months ending March 31, 2023. Ground cash flow margin was impacted by expenses associated with fee simple interests acquired, primarily for property taxes.

Annualized In-Place Rents (“AIPR”) increased to $165.8 million as of March 31, 2023, an increase of $40.4 million, or 32% over AIPR of $125.4 million as of March 31, 2022. On a constant currency basis, AIPR would have increased 35% year-over-year to $169.6 million as of March 31, 2023.

Investments in Real Property Interests and Related Intangible Assets, as identified in the Company’s Consolidated Statements of Cash Flows, was $43.7 million and $73.1 million for the quarter ended March 31, 2023 and 2022, respectively, or a decrease of $29.4 million for the quarter ended March 31, 2023 over the prior period.

Acquisition Capex was $48.2 million and $74.6 million for the quarter ended March 31, 2023 and 2022, respectively, or a decrease of $26.4 million for the quarter ended March 31, 2023 over the prior period.

Please refer to the GAAP financial disclosures, reconciliations and comparisons to non-GAAP financial measurements set forth below and in the Company’s Form 10-Q for the quarter ended March 31, 2023.

LIQUIDITY

As of March 31, 2023, Radius had $296.5 million of total cash and cash equivalents, restricted cash (including long-term restricted cash), and short-term investments. Of this amount, approximately $273.4 million was available to deploy for asset acquisitions after excluding amounts that are required to be held in interest escrow accounts under certain long-term debt agreements.

OUTLOOK FOR 2023

As previously noted, the Company is not providing guidance with respect to the outlook for Acquisition Capex in 2023 in light of the pending transaction with EQT and PSP.

About the Company

Radius Global Infrastructure, Inc., through its various subsidiaries, is a multinational owner and acquiror of triple net rental streams and real properties leased to wireless operators, wired operators, wireless tower companies, and other digital infrastructure operators as part of their infrastructure required to deliver a wide range of services.

For further information see https://www.radiusglobal.com.

FORWARD-LOOKING STATEMENTS AND DISCLAIMERS

Certain matters discussed in this press release, including the attachments, contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are subject to risks and uncertainties. For these statements, we claim the protections of the safe harbor for forward-looking statements contained in such Sections. These forward-looking statements include information about possible or assumed future results of our business, financial condition, liquidity, capital expenditures, plans and objectives, including with respect to capital allocation and organizational matters, and information about our proposed transaction with certain affiliates of EQT and PSP. In some cases, these forward-looking statements can be identified by the use of forward-looking terminology, including the terms “believe,” “expect,” “anticipate,” “estimate,” “outlook,” “plan,” “continue,” “intend,” “should,” “may,” “will,” or similar expressions, their negative or other variations or comparable terminology.

Forward-looking statements are subject to significant risks and uncertainties and are based on current beliefs, assumptions and expectations based upon our historical performance and on our current plans, estimates and expectations in light of information available to us. Any forward-looking statement speaks only as of the date on which it is made. Except as required by law, we are not obligated to, and do not intend to, publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy, liquidity and our proposed transaction with certain affiliates of EQT and PSP. Actual results may differ materially from those set forth in the forward-looking statements. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

Certain important factors that we think could cause our actual results to differ materially from expected results are summarized below. Other factors besides those summarized could also adversely affect us. We operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time and it is not possible for management to predict all such risks and uncertainties or how they may affect us. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

Important other factors that could cause our actual results to differ materially from those expressed in or contemplated by the forward-looking statements include, but are not limited to: our proposed transaction with certain affiliates of EQT and PSP may not be completed in a timely manner or at all, including the risk that any required antitrust and foreign investment approvals are not obtained, are delayed or are subject to unanticipated conditions that could adversely affect us or the expected benefits of the proposed transaction or that the approval of our stockholders is not obtained; the possibility that any or all of the various conditions to the consummation of the proposed transaction may not be satisfied or waived, including the failure (a) to receive any required antitrust and foreign investment approvals from any applicable governmental entities (or any conditions, limitations or restrictions placed on such approvals) and (b) to satisfy conditions related to (i) there being no event of default under certain of the Company’s existing debt facilities, (ii) certain waivers of change of control provisions under certain of the debt agreements of the Company and its subsidiaries being in full force and effect at the closing, including the possibility that such waivers fail to be in full force and effect at the closing because any two of William H. Berkman, Scott G. Bruce and Richard I. Goldstein have ceased to continue in their current capacities as Chief Executive Officer, President and Chief Operating Officer of the Company, respectively, at the closing, and (iii) the Company having a specified minimum cash balance and the Company or any of its subsidiaries having an additional specified amount of additional cash, in each case at the closing; the possibility that compliance with the minimum cash condition to the consummation of the proposed transaction may limit the growth of the Company’s business, depending on the availability to the Company of other sources of capital that are permitted under the terms of the definitive agreement entered into in connection with the proposed transaction; the occurrence of any event, change or other circumstance that could give rise to the termination of the proposed transaction, including in circumstances that would require us to pay a termination fee or other expenses; the effect of the announcement or pendency of the proposed transaction on our ability to retain and hire key personnel, our ability to maintain the relationships with its customers, suppliers and others with whom it does business, or its operating results and business generally; risks related to diverting management’s attention from our ongoing business operations; the risk that stockholder litigation in connection with the proposed transaction may result in significant costs of defense, indemnification and liability; the extent that wireless carriers (mobile network operators, or “MNOs”) or tower companies consolidate their operations, exit the wireless communications business or share site infrastructure to a significant degree; the extent that new technologies reduce demand for wireless infrastructure; competition for assets; whether the tenant leases for the wireless communication tower, antennae or other digital communications infrastructure located on our real property interests are renewed with similar rates or at all; the extent of unexpected lease cancellations, given that most of the tenant leases associated with our assets may be terminated upon limited notice by the MNO or tower company and unexpected lease cancellations could materially impact cash flow from operations; economic, political, cultural, and regulatory risks and other risks to our operations, including risks associated with fluctuations in foreign currency exchange rates and local inflation rates; the effect of the Electronic Communications Code in the United Kingdom, which may limit the amount of lease income we generate in the United Kingdom; the extent that we continue to grow at an accelerated rate, which may prevent us from achieving profitability or positive cash flow at a company level (as determined in accordance with GAAP) for the foreseeable future, particularly given our history of net losses and negative net cash flow; the fact that we have incurred a significant amount of debt and may in the future incur additional indebtedness; the extent that the terms of our debt agreements limit our flexibility in operating our business; and the other factors, risks and uncertainties described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and in our subsequent filings under the Exchange Act.

RADIUS GLOBAL INFRASTRUCTURE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (in USD thousands, except share and per share amounts)

 

 

Three months ended March 31, 2023

 

 

Three months ended March 31, 2022

 

Revenue

 

$

41,214

 

 

$

30,599

 

Cost of service

 

 

1,892

 

 

 

841

 

Gross profit

 

 

39,322

 

 

 

29,758

 

Operating expenses:

 

 

 

 

 

 

Selling, general and administrative

 

 

29,464

 

 

 

22,687

 

Share-based compensation

 

 

5,184

 

 

 

4,592

 

Amortization and depreciation

 

 

23,085

 

 

 

18,751

 

Impairment - decommissions

 

 

1,050

 

 

 

765

 

Total operating expenses

 

 

58,783

 

 

 

46,795

 

Operating loss

 

 

(19,461

)

 

 

(17,037

)

Other income (expense):

 

 

 

 

 

 

Realized and unrealized gain (loss) on foreign currency debt

 

 

(15,479

)

 

 

24,232

 

Interest expense

 

 

(17,671

)

 

 

(16,098

)

Other income (expense), net

 

 

3,215

 

 

 

1,092

 

Total other income (expense), net

 

 

(29,935

)

 

 

9,226

 

Loss before income tax expense (benefit)

 

 

(49,396

)

 

 

(7,811

)

Income tax expense (benefit)

 

 

(1,584

)

 

 

(3,166

)

Net loss

 

 

(47,812

)

 

 

(4,645

)

Net loss attributable to noncontrolling interest

 

 

(2,227

)

 

 

(208

)

Net loss attributable to common stockholders

 

$

(45,585

)

 

$

(4,437

)

 

 

 

 

 

 

 

Loss per common share:

 

 

 

 

 

 

Basic and diluted

 

$

(0.48

)

 

$

(0.05

)

Weighted average common shares outstanding:

 

 

 

 

 

 

Basic and diluted

 

 

95,821,985

 

 

 

92,104,971

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See accompanying notes to condensed consolidated financial statements.

RADIUS GLOBAL INFRASTRUCTURE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in USD thousands, except share and per share amounts)

 

 

March 31, 2023

 

 

December 31, 2022

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

197,879

 

 

$

224,258

 

Restricted cash

 

 

2,417

 

 

 

1,971

 

Short-term investments

 

 

34,612

 

 

 

39,205

 

Total cash, cash equivalents, restricted cash, and short-term investments

 

 

234,908

 

 

 

265,434

 

Trade receivables, net

 

 

11,317

 

 

 

8,200

 

Prepaid expenses and other current assets

 

 

29,747

 

 

 

28,773

 

Total current assets

 

 

275,972

 

 

 

302,407

 

Real property interests, net:

 

 

 

 

 

 

Right-of-use assets - finance leases, net

 

 

415,981

 

 

 

379,052

 

Telecom real property interests, net

 

 

1,582,164

 

 

 

1,569,676

 

Real property interests, net

 

 

1,998,145

 

 

 

1,948,728

 

Intangible assets, net

 

 

11,811

 

 

 

12,121

 

Property and equipment, net

 

 

1,291

 

 

 

1,241

 

Goodwill

 

 

80,509

 

 

 

80,509

 

Deferred tax asset

 

 

1,636

 

 

 

306

 

Restricted cash, long-term

 

 

61,595

 

 

 

88,054

 

Other long-term assets

 

 

21,209

 

 

 

20,124

 

Total assets

 

$

2,452,168

 

 

$

2,453,490

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$

44,121

 

 

$

48,767

 

Rent received in advance

 

 

33,938

 

 

 

26,551

 

Finance lease liabilities, current

 

 

14,392

 

 

 

15,589

 

Telecom real property interest liabilities, current

 

 

4,564

 

 

 

7,975

 

Total current liabilities

 

 

97,015

 

 

 

98,882

 

Finance lease liabilities

 

 

21,768

 

 

 

22,277

 

Telecom real property interest liabilities

 

 

4,076

 

 

 

4,483

 

Long-term debt, net of debt discount and deferred financing costs

 

 

1,521,802

 

 

 

1,503,352

 

Deferred tax liability

 

 

134,238

 

 

 

131,229

 

Other long-term liabilities

 

 

11,585

 

 

 

10,473

 

Total liabilities

 

 

1,790,484

 

 

 

1,770,696

 

Commitments and contingencies

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Series A Founder Preferred Stock, $0.0001 par value; 1,600,000 shares authorized; 1,600,000 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

 

 

—

 

 

 

—

 

Series B Founder Preferred Stock, $0.0001 par value; 1,386,033 shares authorized; 1,386,033 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

 

 

—

 

 

 

—

 

Class A Common Stock, $0.0001 par value; 1,590,000,000 shares authorized; 99,541,524 and 95,283,563 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

 

 

10

 

 

 

10

 

Class B Common Stock, $0.0001 par value; 200,000,000 shares authorized; 10,378,327 and 12,795,694 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively

 

 

—

 

 

 

—

 

Additional paid-in capital

 

 

1,082,943

 

 

 

1,060,055

 

Accumulated other comprehensive loss

 

 

(64,622

)

 

 

(85,936

)

Accumulated deficit

 

 

(384,404

)

 

 

(338,819

)

Total stockholders’ equity attributable to Radius Global Infrastructure, Inc.

 

 

633,927

 

 

 

635,310

 

Noncontrolling interest

 

 

27,757

 

 

 

47,484

 

Total liabilities and stockholders’ equity

 

$

2,452,168

 

 

$

2,453,490

 

See accompanying notes to condensed consolidated financial statements.

RADIUS GLOBAL INFRASTRUCTURE, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (in USD thousands)

 

 

Three months ended March 31, 2023

 

 

Three months ended March 31, 2022

 

Cash flows from operating activities:

 

 

 

 

 

 

Net loss

 

$

(47,812

)

 

$

(4,645

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

Amortization and depreciation

 

 

23,085

 

 

 

18,751

 

Amortization of finance lease and telecom real property interest liabilities discount

 

 

460

 

 

 

367

 

Impairment - decommissions

 

 

1,050

 

 

 

765

 

Realized and unrealized gain on foreign currency debt

 

 

15,479

 

 

 

(24,232

)

Amortization of debt discount and deferred financing costs

 

 

1,715

 

 

 

1,106

 

Provision for bad debt expense

 

 

(64

)

 

 

98

 

Share-based compensation

 

 

5,184

 

 

 

4,592

 

Deferred income taxes

 

 

(3,446

)

 

 

(3,986

)

Change in assets and liabilities:

 

 

 

 

 

 

Trade receivables, net

 

 

(2,790

)

 

 

(1,707

)

Prepaid expenses and other assets

 

 

1,813

 

 

 

1,563

 

Accounts payable, accrued expenses and other long-term liabilities

 

 

(3,391

)

 

 

(1,309

)

Rent received in advance

 

 

6,700

 

 

 

3,978

 

Net cash used in operating activities

 

 

(2,017

)

 

 

(4,659

)

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

Investments in real property interests and related intangible assets

 

 

(43,688

)

 

 

(73,128

)

Advance deposits made for real property interest investments

 

 

(2,589

)

 

 

—

 

Proceeds from sales of real property interests

 

 

213

 

 

 

—

 

Proceeds from maturities of short-term investments

 

 

5,000

 

 

 

—

 

Purchases of property and equipment

 

 

(231

)

 

 

(195

)

Net cash used in investing activities

 

 

(41,295

)

 

 

(73,323

)

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

Borrowings under debt agreements

 

 

—

 

 

 

256,203

 

Repayments of term loans and other debt

 

 

—

 

 

 

(1,804

)

Debt issuance costs

 

 

—

 

 

 

(5,653

)

Proceeds from exercises of stock options

 

 

204

 

 

 

88

 

Repayments of finance lease and telecom real property interest liabilities

 

 

(11,075

)

 

 

(4,359

)

Net cash provided by (used in) financing activities

 

 

(10,871

)

 

 

244,475

 

 

 

 

 

 

 

 

Effect of change in foreign currency exchange rates on cash, cash equivalents and restricted cash

 

 

1,791

 

 

 

(6,426

)

 

 

 

 

 

 

 

Net change in cash and cash equivalents and restricted cash

 

 

(52,392

)

 

 

160,067

 

 

 

 

 

 

 

 

Cash and cash equivalents and restricted cash at beginning of period

 

 

314,283

 

 

 

632,193

 

Cash and cash equivalents and restricted cash at end of period

 

$

261,891

 

 

$

792,260

 

 

 

 

 

 

 

 

Supplemental disclosure of cash and non-cash transactions:

 

 

 

 

 

 

Cash paid for interest

 

$

18,008

 

 

$

15,459

 

Cash paid for income taxes

 

$

373

 

 

$

150

 

See accompanying notes to condensed consolidated financial statements.

Non-GAAP Financial Measures

We use certain additional financial measures not defined by generally accepted accounting principles in the United States (“GAAP”) that provide supplemental information we believe is useful to analysts and investors to evaluate our financial performance and ongoing results of operations, when considered alongside other GAAP measures such as net income, operating income and gross profit. These non-GAAP measures exclude the financial impact of items management does not consider in assessing our ongoing operating performance, and thereby facilitate review of our operating performance on a period-to-period basis.

EBITDA and Adjusted EBITDA

EBITDA and Adjusted EBITDA are non-GAAP measures. EBITDA is defined as net income (loss) before interest expense, income tax expense (benefit), and depreciation and amortization. Adjusted EBITDA is calculated by taking EBITDA and further adjusting for non-cash impairment—decommissions expense, realized and unrealized gains and losses on foreign currency debt, realized and unrealized foreign exchange gains/losses associated with non-debt transactions and balances denominated in a currency other than the functional currency, share-based compensation expense and transaction-related costs recorded in selling, general and administrative expenses incurred for incremental business acquisition pursuits (successful and unsuccessful) and related financing and integration activities. Management believes the presentation of EBITDA and Adjusted EBITDA provides valuable additional information for users of the financial statements in assessing our financial condition and results of operations. Each of EBITDA and Adjusted EBITDA has important limitations as analytical tools because they exclude some, but not all, items that affect net income, therefore the calculation of these financial measures may be different from the calculations used by other companies and comparability may therefore be limited. You should not consider EBITDA, Adjusted EBITDA or any of our other non-GAAP financial measures as an alternative or substitute for our results.

The following are reconciliations of EBITDA and Adjusted EBITDA to net income (loss), the most comparable GAAP measure:

(in thousands)

 

Three months ended March 31, 2023

 

 

Three months ended March 31, 2022

 

(unaudited)

 

 

 

 

 

 

Net loss

 

$

(47,812

)

 

$

(4,645

)

Amortization and depreciation

 

 

23,085

 

 

 

18,751

 

Interest expense

 

 

17,671

 

 

 

16,098

 

Income tax expense (benefit)

 

 

(1,584

)

 

 

(3,166

)

EBITDA

 

 

(8,640

)

 

 

27,038

 

Impairment – decommissions

 

 

1,050

 

 

 

765

 

Realized and unrealized (gain) loss on foreign currency debt

 

 

15,479

 

 

 

(24,232

)

Share-based compensation expense

 

 

5,184

 

 

 

4,592

 

Non-cash foreign currency adjustments

 

 

(34

)

 

 

405

 

Transaction-related costs

 

 

7,195

 

 

 

140

 

Adjusted EBITDA

 

$

20,234

 

 

$

8,708

Acquisition Capex

Acquisition Capex is a non-GAAP financial measure. Our payments for acquisitions of real property interests consist of either a one-time payment upon the acquisition or up-front payments with contractually committed payments made over a period of time, pursuant to each real property interest agreement. In all cases, we contractually acquire all rights associated with the underlying revenue-producing assets upon entering into the agreement to purchase the real property interest and records the related assets in the period of acquisition. Acquisition Capex therefore represents the total cash spent and committed to be spent for the acquisitions of revenue-producing assets during the period measured. Management believes the presentation of Acquisition Capex provides valuable additional information for users of the financial statements in assessing our financial performance and growth, as it is a comprehensive measure of our investments in the revenue-producing assets that we acquire in a given period. Acquisition Capex has important limitations as an analytical tool, because it excludes certain fixed and variable costs related to our selling, marketing and underwriting activities included in selling, general and administrative expenses in the condensed consolidated statements of operations, including corporate overhead expenses. Further, this financial measure may be different from calculations used by other companies and comparability may therefore be limited. You should not consider Acquisition Capex or any of the other non-GAAP measures we utilize as an alternative or substitute for our results.

The following is a reconciliation of Acquisition Capex to the amounts included as an investing cash flow in the condensed consolidated statements of cash flows for investments in real property interests and related intangible assets, the most comparable GAAP measure, which generally represents up-front payments made in connection the acquisition of these assets during the period. The primary adjustment to the comparable GAAP measure is “committed contractual payments for investments in real property interests and intangible assets,” which represents the total amount of future payments that we were contractually committed to make in connection with our acquisitions of real property interests and intangible assets that occurred during the period. Additionally, foreign exchange translation adjustments impact the determination of Acquisition Capex.

(in thousands)

 

Three months ended March 31, 2023

 

 

Three months ended March 31, 2022

 

(unaudited)

 

 

 

 

 

 

Investments in real property interests and related intangible assets

 

$

43,688

 

 

$

73,128

 

Committed contractual payments for investments in real property interests and intangible assets

 

 

5,279

 

 

 

4,123

 

Foreign exchange translation impacts and other

 

 

(748

)

 

 

(2,614

)

Acquisition Capex

 

$

48,219

 

 

$

74,637

 

Annualized In-Place Rents

Annualized in-place rents is a non-GAAP measure that measures performance based on annualized contractual revenue from the rents expected to be collected on leases owned and acquired (“in place”) as of the measurement date. Annualized in-place rents is calculated using the implied monthly revenue from all revenue producing leases that are in place as of the measurement date multiplied by twelve. Implied monthly revenue for each lease is calculated based on the most recent rental payment under such lease. Management believes the presentation of annualized in-place rents provides valuable additional information for users of the financial statements in assessing our financial performance and growth. In particular, management believes the presentation of annualized in-place rents provides a measurement at the applicable point of time as opposed to revenue, which is recorded in the applicable period on revenue-producing assets in place as they are acquired. Annualized in-place rents has important limitations as an analytical tool because it is calculated at a particular moment in time, the measurement date, but implies an annualized amount of contractual revenue. As a result, following the measurement date, among other things, the underlying leases used in calculating the annualized in-place rents financial measure may be terminated, new leases may be acquired, or the contractual rents payable under such leases may not be collected. In these respects, among others, annualized in-place rents differs from “revenue,” which is the closest comparable GAAP measure and which represents all revenues (contractual or otherwise) earned over the applicable period. Revenue is recorded as earned over the period in which the lessee is given control over the use of the wireless communication sites and recorded over the term of the lease. You should not consider annualized in-place rents or any of the other non-GAAP measures we utilize as an alternative or substitute for our results. The following is a comparison of annualized in-place rents to revenue, the most comparable GAAP measure:

(in thousands)

 

Three months ended March 31, 2023

 

 

Year ended December 31, 2022

 

(unaudited)

 

 

 

 

 

 

Revenue for year ended December 31

 

 

 

 

$

135,456

 

Annualized in-place rents as of December 31

 

 

 

 

$

157,553

 

Annualized in-place rents as of March 31

 

$

165,779

 

 

 

 

 

1 Please see page 9 for a definition of Acquisition Capex and reconciliation to Investments in Real Property Interests and Related Intangible Assets, the most comparable GAAP measure.

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