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EXHIBIT 99.5
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL DATA
The following unaudited pro forma consolidated financial data presents the
consolidated balance sheet of Pinnacle Holdings Inc. (the "Company") as of June
30, 2000 as if the Transactions had occurred on June 30, 2000 and the unaudited
pro forma consolidated statement of operations for the year ended December 31,
1999 and for the six months ended June 30, 2000 as if the Transactions had
occurred on January 1, 1999.
The Transactions
On March 3, 2000, Microcell Management, Inc. sold its telecommunication
tower portfolio to Pinnacle Towers Inc. for $71.2 million. Pro Forma
adjustments have been made for the results of operations prior to March 3,
2000 and for the related assets and liabilities acquired.
On June 23, 2000, Tower Ventures II sold its tower assets to Pinnacle
Towers Inc. for $30.0 million. Pro Forma adjustments have been made for the
results of operations prior to June 23, 2000 and for the related assets and
liabilities acquired.
On July 3, 2000, Tucker-Valley Communications sold its building assets and
business operations to Pinnacle Towers Inc. for $56.0 million. Pro Forma
adjustments have been made for the results of operations and related assets
acquired for all periods presented.
In June 2000, Beverly Hills Center LLC entered into an agreement to sell
its building and certain other assets and operations to Pinnacle Towers
Inc. for $135.0 million. The purchase for Beverly Hills Center LLC has not
closed as of September 18, 2000. The Company expects to complete this
transaction in 2000. Pro Forma adjustments have been made for the results
of operations and related assets to be acquired for all periods presented.
The unaudited pro forma consolidated financial data are based on the
historical consolidated financial statements of Pinnacle and the financial
statements of the purchased entities (Microcell Management, Inc., Tower
Ventures II, Tucker-Valley Communications LLC, and Beverly Hills Center, LLC)
and on the assumptions and adjustments described in the notes to such unaudited
pro forma consolidated financial data, including assumptions relating to the
allocation of the consideration paid for the purchased entities to the assets
and liabilities of the purchased entities based on preliminary estimates of
their respective fair value. The actual allocation of such consideration may
differ from that recorded in the unaudited pro forma consolidated financial
data.
The Registrant accounts for its acquisitions under the purchase method of
accounting. The total cost of site rental businesses acquired including
related fees and expenses is allocated to the underlying tangible and
intangible assets acquired and liabilities assumed based on their respective
fair values. The purchase price allocations for the respective acquisitions
included in the unaudited pro forma data are preliminary. However, the
Registrant does not expect that the final allocation of the purchase price will
be materially different from its preliminary allocation.
The unaudited pro forma financial data are provided for informational purposes
only and are not necessarily indicative of our results of operations or
financial position had the transactions assumed therein occurred, nor are they
necessarily indicative of the results of operations that may be expected to
occur in the future. Furthermore, the unaudited pro forma financial data are
based upon the assumptions that the Registrant believes are reasonable and
should be read in conjunction with the financial statements and the
accompanying notes thereto.
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PINNACLE HOLDINGS INC.
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
As of June 30, 2000
(in thousands)
<TABLE>
<CAPTION>
PRO FORMA PRO FORMA
PINNACLE ADJUSTMENTS ADJUSTMENTS
HOLDINGS TUCKER-VALLEY BEVERLY HILLS FOR FOR
JUNE 30, COMMUNICATIONS CENTER, LLC TUCKER-VALLEY BEVERLY HILLS PRO
2000 JUNE 30, 2000 JUNE 30, 2000 COMMUNICATIONS LLC(a) CENTER, LLC(a) FORMA
-------- -------------- ------------- --------------------- -------------- ---------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 156,081 $ 170 $ 1,376 $(56,170) $(1,376) $ 100,081
Accounts receivable 17,428 43 976 (43) (976) 17,428
Prepaid expenses and other
current assets 12,408 913 - (913) - 12,408
---------- ------- -------- -------- -------- ----------
Total current assets 185,917 1,126 2,352 (57,126) (2,352) 129,917
Fixed assets, net 1,223,865 6,776 26,202 50,165 111,136 1,418,144
Leasehold interests, net 64,185 - - - - 64,185
Deferred debt costs, net 19,304 - - - - 19,304
Other assets 5,855 - 4,535 - (4,535) 5,855
---------- ------- -------- -------- -------- ----------
$1,499,126 $ 7,902 $ 33,089 $ (6,961) $104,249 $1,637,405
========== ======= ======== ======== ======== ==========
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable $ 7,246 $ 252 $ 346 $ (252) $(346) $7,246
Accrued expenses 42,944 - - 941 2,338 46,223
Deferred revenue 8,691 55 417 (55) (417) 8,691
Short-term debt 4,761 9,388 694 (9,388) (694) 4,761
Other current liabilities - 93 - (93) - -
---------- ------- -------- -------- -------- ----------
Total current liabilities 63,642 9,788 1,457 (8,847) 881 66,921
Long-term debt 819,309 - 42,009 - 92,991 954,309
Other liabilities 678 - 1,682 - (1,682) 678
---------- ------- -------- -------- -------- ----------
883,629 9,788 45,148 (8,847) 92,190 1,021,908
---------- ------- -------- -------- -------- ----------
STOCKHOLDERS' EQUITY
Common stock 48 - - - - 48
Additional paid-in capital 771,957 - - - - 771,957
Foreign currency translation 100 - - - - 100
Accumulated deficit (156,608) (1,886) (12,059) 1,886 12,059 (156,608)
---------- ------- -------- -------- -------- ----------
Total stockholders'
equity 615,497 (1,886) (12,059) 1,886 12,059 615,497
---------- ------- -------- -------- -------- ----------
$1,499,126 $ 7,902 $ 33,089 $ (6,961) $104,249 $1,637,405
========== ======= ======== ======== ======== ==========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Consolidated Balance Sheet
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
(a) Represents the pro forma impact of the Tucker-Valley Communications and
Univision acquisitions for a total cost of $56,941 and $137,338,
respectively, and the Company's preliminary allocation of purchase price in
accordance with the purchase method of accounting, and the related debt
financing under its credit facility. No assets other than telecommunication
assets were acquired by Pinnacle Holdings Inc. The adjustment for accrued
expenses represents estimated acquisition costs. The adjustment for
long-term debt represents the borrowings of $135.0 million under our senior
credit facility for the acquisition of the Beverly Hills Center, LLC. No
existing liabilities of Tucker-Valley Communications or Beverly Hills
Center, LLC were assumed by Pinnacle Holdings Inc.
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PINNACLE HOLDINGS INC.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
Year Ended December 31, 1999
(in thousands, except per share amount)
<TABLE>
<CAPTION>
Pinnacle Tower Tucker-Valley Beverly Hills
Holdings Microcell Ventures II, LLC Communications Center, LLC
December 31, December 31, December 31, December 31, December 31, Pro forma Pro
1999 1999 1999 1999 1999 Adjustments Forma
------------ ------------ ---------------- -------------- ------------ ------------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 85,421 $ 2,913 $ 643 $3,356 $11,624 $ - $103,957
Direct operating expenses,
excluding depreciation and
amortization 24,867 1,166 536 1,556 5,513 - 33,638
------------ ------------ ---------------- -------------- ------------ ---------- --------
Gross profit, excluding
depreciation and
amortization 60,554 1,747 107 1,800 6,111 - 70,319
Other expenses:
General and administrative 4,882 3,098 274 625 78 - 8,957
Corporate development 9,912 - - - - - 9,912
State franchise, excise and
minimum taxes 1,107 - - - - - 1,107
Depreciation and
amortization 58,813 1,225 147 191 1,231 17,147(a) 78,754
------------ ------------ ---------------- -------------- ----------- ---------- --------
74,714 4,323 421 816 1,309 17,147 98,730
Income (loss) from operations (14,160) (2,576) (314) 984 4,802 (17,147) (28,411)
Interest expense 22,953 1,715 229 700 1,618 10,532(b) 37,747
Amortization of original issue
discount and debt issuance
costs 23,708 - - - - - 23,708
------------ ------------ ---------------- -------------- ----------- ---------- --------
Net (loss) income before
taxes (60,821) (4,291) (543) 284 3,184 (27,679) (89,866)
============ ============ ================ ============== =========== ========== ========
Benefit from income taxes - 3,721 - - - (3,721) -
------------ ------------ ---------------- -------------- ----------- ---------- --------
Net (loss) income (60,821) (570) (543) 284 3,184 (31,400) (89,866)
============ ============ ================ ============== =========== ========== ========
Payable in kind preferred
dividends and accretion 2,930 - - - - - 2,930
------------ ------------ ---------------- -------------- ----------- ---------- --------
Net (loss) income
attributable tocommon
stockholders $(63,751) $ (570) $(543) $ 284 $ 3,184 $(31,400) $(92,796)
============ ============ ================ ============== ============ ========== ========
Basic and diluted loss per
common share (1.96) (2.85)
Weighted average number of
common shares 32,588 32,588
</TABLE>
See accompanying Notes to Unaudited Pro Forma Consolidated Statements of
Operations
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PINNACLE HOLDINGS INC.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
Six Months Ended June 30, 2000
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
PINNACLE ADJUSTMENTS TUCKER- BEVERLY HILLS
HOLDINGS ADJUSTMENTS FOR TOWER VALLEY CENTER, LLC PRO
JUNE 30, FOR MICROCELL VENTURES II, COMMUNICATIONS JUNE 30, FORMA PRO
2000 (C) LLC(C) JUNE 30, 2000 2000 ADJUSTMENTS FORMA
-------- ----------------- ------------ ------------- --------- ----------- -----
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 84,283 $ 567 $771 $1,851 $6,547 $ -- $ 94,019
Direct operating expenses, excluding
depreciation and amortization 29,298 227 154 1,026 2,340 -- 33,045
-------- ------- ------- ------- ------- -------- --------
Gross profit, excluding
depreciation and amortization 54,985 340 617 825 4,207 -- 60,974
Other expenses:
General and administrative 4,013 603 71 221 189 -- 5,097
Corporate development 8,148 -- -- -- -- -- 8,148
State franchise, excise and
minimum 742 -- -- -- -- -- 742
Depreciation and amortization 54,915 239 160 110 604 8,858 (a) 64,886
-------- ------- ------- ------- ------- -------- --------
67,818 842 231 331 793 8,858 78,873
Income (loss) from operations (12,833) (502) 386 494 3,414 (8,858) (17,899)
Interest expense 16,311 334 190 407 1,483 4,592 (b) 23,317
Amortization of original issue
discount and debt issuance costs 13,250 -- -- -- -- -- 13,250
-------- ------- ------- ------- ------- -------- --------
Net (loss) income attributable to
common stockholders $(42,394) $(836) $196 $ 87 $1,931 $(13,450) $(54,466)
======== ======= ======= ======= ======= ======== ========
Basic and diluted loss per
common share (0.89) (1.15)
Weighted average number of
common shares 47,411 47,411
</TABLE>
See accompanying Notes to Unaudited Pro Forma Consolidated Statements of
Operations
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands)
(a) Reflects the increase in pro forma depreciation on site assets acquired
resulting from the Company's preliminary application of purchase accounting
based on an average estimated useful life of telecommunication site assets
of 15 years.
(b) Reflects the pro forma increase in net interest expense associated with the
financing of the Univision acquisition based on a historical average
interest rate of 9% under our senior credit facility.
(c) Reflects the historical operations of the acquisitions prior to their
respective acquisition dates.
38
