RESTON, Va., Aug. 11, 2016 /PRNewswire/ -- NII Holdings, Inc.
(NASDAQ: NIHD) today announced its financial results for the second
quarter of 2016. For the quarter, the Company generated
consolidated operating revenues of $249
million, consolidated adjusted operating income before
depreciation and amortization (adjusted OIBDA) of $14 million and a consolidated operating loss of
$29 million. The Company's
consolidated adjusted OIBDA excludes the impact of non-cash asset
impairments, restructuring charges and other unusual items. Capital
expenditures were $4 million for the
quarter. The Company ended the quarter with $429 million in consolidated cash and short-term
investments and $208 million of cash
held in escrow. The Company reported net subscriber losses of
179,000 in the quarter, which were primarily driven by continued
subscriber losses on the Company's iDEN network.
"We continued to make progress this quarter toward improving our
operating results," said Steve
Shindler, Chief Executive Officer. "Our team in Brazil has maintained a steady focus on
managing our cost structure to align with our revenue stream,
resulting in improved adjusted OIBDA and lower cash burn. Our
subscriber results reflect both our strategy to selectively load
subscribers with attractive ARPU and profitability profiles and the
challenging economic and competitive environment in Brazil that continues to put pressure on our
churn."
Nextel Brazil's average monthly service revenue per subscriber
(ARPU) for the second quarter of 2016 increased 6% on a constant
currency basis compared to the same quarter last year, but declined
by $1 on a reported basis due to a
14% year-over-year decline in the average value of the Brazilian
real. Nextel Brazil's average monthly churn rate for the quarter
increased to 3.99 percent in the second quarter of 2016 from 3.34
percent in the same quarter last year due to increases in both 3G
and iDEN churn. Nextel Brazil's cost per gross addition (CPGA) was
$99 for the second quarter of 2016, a
$108 decrease from the same quarter
last year, primarily due to an increase in new 3G postpaid
subscribers in Brazil who use
their own handsets rather than purchasing a new one from the
Company. Nextel Brazil's cash cost per user (CCPU) was $16 for the second quarter of 2016, a
$5 decrease from the same quarter
last year primarily resulting from reductions in various operating
costs and a decline in local currency exchange rates.
"We continued to focus on our liquidity, which increased by
$62 million during the quarter
primarily from the recovery of $57
million of cash that was securing performance bonds in
Brazil," said Dan Freiman, Chief Financial Officer. "We were
also able to keep our cash burn low as we continued to benefit from
cost reductions in our business while keeping our revenues
stable."
Receipt of Bank Covenant Waivers in Brazil
The Company also announced that Nextel Brazil, its wholly-owned
operating subsidiary, has secured waivers from Banco do Brazil and Caixa Econômica Federal related to
certain financial covenants in its local bank loans. In accordance
with the waivers, the lenders have agreed to waive Nextel Brazil's
obligation to comply with a net debt to earnings before interest,
taxes, depreciation and amortization, or EBITDA, ratio test for the
June 30, 2016 measurement date. The
next measurement date for the net debt to EBITDA ratio test will be
December 31, 2016, at which point
Nextel Brazil must maintain a net debt to EBITDA ratio of no
greater than 3.5.
Roaming and RAN Sharing Agreement
In May 2016, Nextel Brazil entered
into an amendment to a nationwide roaming voice and data services
agreement with Telefonica Brazil S.A. to reduce the usage rates for
roaming traffic. Concurrently, Nextel Brazil entered into a 10-year
radio access network, or RAN, sharing agreement with Telefonica
under which Telefonica will permit Nextel Brazil to use its tower
and equipment infrastructure to transmit telecommunications signals
on Nextel Brazil's spectrum. These agreements require Nextel Brazil
to meet certain minimum annual commitments over a five-year period
totaling 800 million Brazilian reais, which replaced the remaining
commitments under the original roaming agreement. Nextel Brazil is
required to prepay 250 million Brazilian reais shortly after the
agreements become effective with receipt of regulatory approvals,
which occurred in early August. The Company expects the RAN sharing
agreement to provide significant financial benefits to Nextel
Brazil. It will allow Nextel Brazil to cease operating a
significant number of its transmitter and receiver sites in
low-usage areas, which would reduce future operating expenses. In
addition, Nextel Brazil will be able to forego construction of new
transmitter and receiver sites and utilize the RAN sharing
agreement to fulfill regulatory coverage obligations, which would
reduce future operating expenses and capital expenditures.
**********
Additional details regarding the Company's results, including a
more detailed explanation on local currency operating metrics, are
included in the Company's Quarterly Report on Form 10-Q for the
three months ended June 30, 2016 that
was filed with the Securities and Exchange Commission today. In
2015, the Company sold its operations in Mexico and Argentina, and as a result, all results
presented in this press release reflect these markets as
discontinued operations. Additional operational and financial
details, including a quarterly earnings presentation, are also
available under the Company's Investor Relations link at
www.nii.com.
In addition to the financial results prepared in accordance with
accounting principles generally accepted in the United States (GAAP) provided throughout
this press release and in the attached financial tables, NII
Holdings has presented consolidated adjusted OIBDA, as well as
Nextel Brazil's ARPU, CCPU, and CPGA. These measures are non-GAAP
financial measures and should be considered in addition to, but not
as substitutes for, the information prepared in accordance with
GAAP. Reconciliations from GAAP results to these non-GAAP financial
measures are provided in the notes to the attached financial
tables. To view these and other reconciliations of non-GAAP
financial measures that the Company uses, visit the investor
relations link at www.nii.com.
About NII Holdings, Inc.
NII Holdings, Inc., a publicly held company based in
Reston, Virginia, is a provider of
differentiated mobile communication services for businesses and
high value consumers in Brazil.
NII Holdings, operating under the Nextel brand, offers fully
integrated wireless communication tools with digital cellular voice
services, data services and wireless Internet access. Visit the
Company's website at www.nii.com.
Nextel, the Nextel logo and Nextel Direct Connect are
trademarks and/or service marks of Nextel Communications,
Inc.
Visit NII Holdings' news room for news and to access our
markets' news centers: nii.com/newsroom.
Safe Harbor Statement
"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995. This news release includes
"forward-looking statements" within the meaning of the securities
laws. The statements in this news release regarding the business
and economic outlook, future performance and forward-looking
guidance, as well as other statements that are not historical
facts, are forward-looking statements. Forward-looking statements
are estimates and projections reflecting management's judgment
based on currently available information and involve a number of
risks and uncertainties that could cause actual results to differ
materially from those suggested by the forward-looking
statements. With respect to these forward-looking statements,
management has made assumptions regarding, among other things, the
Company's ability to meet its business plans, customer growth and
retention, pricing, network usage, operating costs, the timing of
various events, the economic and regulatory environment and the
foreign currency exchange rates that will prevail during 2016.
Future performance cannot be assured and actual results may differ
materially from those in the forward-looking statements. Some
factors that could cause actual results to differ include the risks
and uncertainties relating to: the impact of liquidity constraints,
the impact of more intense competitive conditions and changes in
economic conditions in Brazil, the
performance of the Company's networks, the Company's ability to
provide services that customers want or need, the ability of the
Company to continue as a going concern, the Company's ability to
execute its business plan, and the additional risks and
uncertainties that are described in NII Holdings' Annual Report on
Form 10-K for the year ended December 31,
2015, as well as in other reports filed from time to time by
NII Holdings with the Securities and Exchange Commission. This
press release speaks only as of its date, and NII Holdings
disclaims any duty to update the information herein.
NII HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS
FOR THE THREE AND
SIX MONTHS ENDED JUNE 30, 2016 (SUCCESSOR COMPANY)
AND
THE THREE AND SIX
MONTHS ENDED ENDED JUNE 30, 2015 (PREDECESSOR COMPANY) (1)
(2)
(in millions,
except per share amounts)
|
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
2016
|
|
|
2015
|
|
2016
|
|
|
2015
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
Operating
revenues
Service and
other revenues
|
$
|
243.1
|
|
|
|
$
|
303.2
|
|
|
$
|
463.7
|
|
|
|
$
|
643.9
|
|
Handset and
accessory revenues
|
6.1
|
|
|
|
17.1
|
|
|
12.0
|
|
|
|
39.8
|
|
|
249.2
|
|
|
|
320.3
|
|
|
475.7
|
|
|
|
683.7
|
|
Operating
expenses
Cost of
service (exclusive of depreciation and amortization
included below)
|
81.9
|
|
|
|
126.0
|
|
|
171.9
|
|
|
|
256.1
|
|
Cost of
handsets and accessories
|
8.9
|
|
|
|
65.4
|
|
|
20.0
|
|
|
|
121.1
|
|
Selling,
general and administrative
|
135.9
|
|
|
|
223.8
|
|
|
269.3
|
|
|
|
419.7
|
|
Impairment,
restructuring and other charges
|
10.6
|
|
|
|
29.5
|
|
|
16.5
|
|
|
|
36.8
|
|
Depreciation
|
29.7
|
|
|
|
60.7
|
|
|
59.8
|
|
|
|
126.8
|
|
Amortization
|
11.0
|
|
|
|
13.0
|
|
|
21.0
|
|
|
|
27.1
|
|
|
278.0
|
|
|
|
518.4
|
|
|
558.5
|
|
|
|
987.6
|
|
Operating
loss
|
(28.8)
|
|
|
|
(198.1)
|
|
|
(82.8)
|
|
|
|
(303.9)
|
|
Other (expense)
income
Interest
expense, net
|
(27.2)
|
|
|
|
(47.6)
|
|
|
(52.4)
|
|
|
|
(82.8)
|
|
Interest
income
|
10.8
|
|
|
|
8.9
|
|
|
20.5
|
|
|
|
15.3
|
|
Foreign
currency transaction gains (losses), net
|
43.4
|
|
|
|
14.6
|
|
|
83.0
|
|
|
|
(64.0)
|
|
Other expense,
net
|
(2.4)
|
|
|
|
(9.4)
|
|
|
(4.9)
|
|
|
|
(0.1)
|
|
|
24.6
|
|
|
|
(33.5)
|
|
|
46.2
|
|
|
|
(131.6)
|
|
Loss from
continuing operations before reorganization items and income tax
provision
|
(4.2)
|
|
|
|
(231.6)
|
|
|
(36.6)
|
|
|
|
(435.5)
|
|
Reorganization
items
|
(0.2)
|
|
|
|
1,970.5
|
|
|
(0.6)
|
|
|
|
1,956.9
|
|
Income tax
provision
|
(0.4)
|
|
|
|
(1.1)
|
|
|
(0.4)
|
|
|
|
(2.0)
|
|
Net (loss) income
from continuing operations
|
(4.8)
|
|
|
|
1,737.8
|
|
|
(37.6)
|
|
|
|
1,519.4
|
|
Net (loss) income
from discontinued operations, net of
income
taxes
|
(5.1)
|
|
|
|
312.2
|
|
|
(8.9)
|
|
|
|
221.1
|
|
Net (loss)
income
|
$
|
(9.9)
|
|
|
|
$
|
2,050.0
|
|
|
$
|
(46.5)
|
|
|
|
$
|
1,740.5
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
from continuing operations per common
share, basic
|
$
|
(0.05)
|
|
|
|
$
|
10.04
|
|
|
$
|
(0.37)
|
|
|
|
$
|
8.73
|
|
Net (loss) income
from discontinued operations per common
share, basic
|
(0.05)
|
|
|
|
1.80
|
|
|
(0.09)
|
|
|
|
1.27
|
|
Net (loss) income
per common share, basic
|
$
|
(0.10)
|
|
|
|
$
|
11.84
|
|
|
$
|
(0.46)
|
|
|
|
$
|
10.00
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
from continuing operations per common
share, diluted
|
$
|
(0.05)
|
|
|
|
$
|
10.03
|
|
|
$
|
(0.37)
|
|
|
|
$
|
8.71
|
|
Net (loss) income
from discontinued operations per common
share, diluted
|
(0.05)
|
|
|
|
1.80
|
|
|
(0.09)
|
|
|
|
1.27
|
|
Net (loss) income
per common share, diluted
|
$
|
(0.10)
|
|
|
|
$
|
11.83
|
|
|
$
|
(0.46)
|
|
|
|
$
|
9.98
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding,
basic
|
100.0
|
|
|
|
172.4
|
|
|
100.0
|
|
|
|
172.4
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding,
diluted
|
100.0
|
|
|
|
172.6
|
|
|
100.0
|
|
|
|
172.7
|
|
CONSOLIDATED
BALANCE SHEETS (1) (2)
(in millions,
except par values)
|
|
|
Successor
Company
|
|
June
30,
2016
|
|
December 31,
2015
|
|
|
|
|
ASSETS
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
338.1
|
|
|
$
|
342.2
|
|
Short-term
investments
|
91.4
|
|
|
84.3
|
|
Accounts receivable,
net of allowance for doubtful accounts of $55.3 and
$39.0
|
167.3
|
|
|
144.6
|
|
Handset and accessory
inventory
|
15.3
|
|
|
24.4
|
|
Prepaid expenses and
other
|
312.1
|
|
|
132.5
|
|
Total current
assets
|
924.2
|
|
|
728.0
|
|
Property, plant
and equipment, net
|
608.6
|
|
|
555.0
|
|
Intangible assets,
net
|
1,047.4
|
|
|
892.6
|
|
Other
assets
|
266.7
|
|
|
554.3
|
|
Total
assets
|
$
|
2,846.9
|
|
|
$
|
2,729.9
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$
|
48.9
|
|
|
$
|
43.8
|
|
Accrued expenses and
other
|
282.1
|
|
|
268.8
|
|
Deferred
revenues
|
9.1
|
|
|
10.4
|
|
Current portion of
long-term debt
|
606.9
|
|
|
582.4
|
|
Total current
liabilities
|
947.0
|
|
|
905.4
|
|
Long-term
debt
|
99.2
|
|
|
82.6
|
|
Other long-term
liabilities
|
110.6
|
|
|
197.9
|
|
Total
liabilities
|
1,156.8
|
|
|
1,185.9
|
|
Stockholders'
deficit
|
|
|
|
Undesignated
preferred stock, par value $0.001, 10.0 shares authorized, no
shares
issued or
outstanding
|
—
|
|
|
—
|
|
Common stock, par
value $0.001, 140.0 shares authorized, 100.1 shares issued and
outstanding — 2016, 100.0 shares issued and
outstanding — 2015
|
0.1
|
|
|
0.1
|
|
Paid-in
capital
|
2,074.0
|
|
|
2,070.5
|
|
Accumulated
deficit
|
(327.3)
|
|
|
(280.9)
|
|
Accumulated other
comprehensive loss
|
(56.7)
|
|
|
(245.7)
|
|
Total stockholders'
equity
|
1,690.1
|
|
|
1,544.0
|
|
Total liabilities and
stockholders' equity
|
$
|
2,846.9
|
|
|
$
|
2,729.9
|
|
CONSOLIDATED CASH
FLOW DATA (1) (2)
(in
millions)
|
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
Six Months
Ended June 30,
|
|
|
Six Months
Ended June 30,
|
|
2016
|
|
|
2015
|
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
$
|
342.2
|
|
|
|
$
|
334.2
|
|
Net cash provided by
(used in) operating activities
|
8.0
|
|
|
|
(254.8)
|
|
Net cash provided by
investing activities
|
17.0
|
|
|
|
1,027.8
|
|
Net cash used in
financing activities
|
(28.5)
|
|
|
|
(778.2)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
(0.6)
|
|
|
|
(9.2)
|
|
Change in cash and
cash equivalents related to discontinued
operations
|
—
|
|
|
|
103.3
|
|
Cash and cash
equivalents, end of period
|
$
|
338.1
|
|
|
|
$
|
423.1
|
|
(1) In accordance with the requirements of
reorganization accounting, we adopted the provisions of fresh-start
accounting as of June 30, 2015 and
became a new entity for financial reporting purposes. References to
the "Successor Company" relate to NII Holdings on or subsequent to
June 30, 2015. References to the
"Predecessor Company" relate to NII Holdings prior to June 30, 2015.
(2) On September 11,
2015, we entered into a binding agreement relating to the
sale of all of the outstanding equity interests of Nextel
Argentina. On January 27, 2016, the
agreement was amended to permit Grupo
Clarin or any of its affiliates to exercise the right to
acquire the remaining 51% equity interest prior to receiving
regulatory approval, and Grupo
Clarin and its affiliate immediately acquired the remaining
51% of Nextel Argentina for no additional proceeds. In connection
with this sale, we have reported the results for Nextel Argentina
as discontinued operations throughout this document.
NII HOLDINGS, INC.
AND SUBSIDIARIES
OPERATING RESULTS
AND METRICS
FOR THE THREE AND
SIX MONTHS ENDED JUNE 30, 2016 (SUCCESSOR COMPANY) AND
THE
THREE AND SIX
MONTHS ENDED JUNE 30, 2015 (PREDECESSOR COMPANY)
(UNAUDITED)
|
|
Nextel
Brazil
|
(dollars in
millions, except ARPU and CPGA, and subscribers in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
|
2016
|
|
|
2015
|
|
2016
|
|
|
2015
|
|
Service and other
revenues
|
$
|
243.1
|
|
|
|
$
|
303.2
|
|
|
$
|
463.6
|
|
|
|
$
|
643.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Handset and accessory
revenues
|
6.1
|
|
|
|
17.1
|
|
|
12.0
|
|
|
|
39.8
|
|
|
Cost of handsets and
accessories
|
(8.9)
|
|
|
|
(65.4)
|
|
|
(20.0)
|
|
|
|
(121.1)
|
|
|
Handset and accessory
net subsidy
|
(2.8)
|
|
|
|
(48.3)
|
|
|
(8.0)
|
|
|
|
(81.3)
|
|
|
Cost of service
(exclusive of depreciation and amortization)
|
(81.9)
|
|
|
|
(126.0)
|
|
|
(171.9)
|
|
|
|
(256.2)
|
|
|
Selling, general and
administrative
|
(126.1)
|
|
|
|
(207.7)
|
|
|
(247.7)
|
|
|
|
(381.5)
|
|
|
Segment earnings
(losses)
|
32.3
|
|
|
|
(78.8)
|
|
|
36.0
|
|
|
|
(75.2)
|
|
|
Reversal of accrued
tax contingency
|
(8.1)
|
|
|
|
—
|
|
|
(8.1)
|
|
|
|
—
|
|
|
Adjusted operating
income (loss) before depreciation and
amortization
|
$
|
24.2
|
|
|
|
$
|
(78.8)
|
|
|
$
|
27.9
|
|
|
|
$
|
(75.2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subscriber
units
|
|
|
|
|
|
|
|
|
|
|
iDEN
|
1,127.8
|
|
|
|
2,166.2
|
|
|
|
|
|
|
|
WCDMA
|
2,717.1
|
|
|
|
2,254.2
|
|
|
|
|
|
|
|
Total
subscriber units in commercial service (as of June
30)
|
3,844.9
|
|
|
|
4,420.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
iDEN net subscriber
losses
|
(149.7)
|
|
|
|
(189.0)
|
|
|
|
|
|
|
|
WCDMA net subscriber
(losses) additions
|
(29.2)
|
|
|
|
224.5
|
|
|
|
|
|
|
|
Total
net subscriber (losses) additions
|
(178.9)
|
|
|
|
35.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Migrations from
iDEN to WCDMA
|
37.6
|
|
|
|
59.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
iDEN customer
churn
|
4.46
|
%
|
|
|
3.54
|
%
|
|
|
|
|
|
|
WCDMA customer
churn
|
3.78
|
%
|
|
|
3.13
|
%
|
|
|
|
|
|
|
Churn
(%)
|
3.99
|
%
|
|
|
3.34
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ARPU
(1)
|
$
|
19
|
|
|
|
$
|
20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CPGA
(1)
|
$
|
99
|
|
|
|
$
|
207
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CCPU
(1)
|
$
|
16
|
|
|
|
$
|
21
|
|
|
|
|
|
|
|
(1) For information regarding ARPU, CPGA and CCPU, see "Non-GAAP
Reconciliations for the Three and Six Months Ended June 30, 2016 (Successor Company) and Three and
Six Months Ended June 30, 2015
(Predecessor Company)" included in this release.
NON-GAAP RECONCILIATIONS
FOR THE
THREE AND SIX MONTHS ENDED JUNE 30,
2016 (SUCCESSOR COMPANY) AND
THREE AND SIX MONTHS
ENDED JUNE 30, 2015 (PREDECESSOR
COMPANY)
(UNAUDITED)
Consolidated OIBDA and Consolidated Adjusted OIBDA
Consolidated operating income before depreciation and
amortization, or OIBDA, represents operating income before
depreciation and amortization expense. Consolidated adjusted
operating income before depreciation and amortization, or adjusted
OIBDA, represents consolidated operating income before depreciation
expense, amortization expense, material asset impairments,
severance costs associated with publicly announced restructuring
plans and other material non-recurring or unusual charges.
Consolidated OIBDA and consolidated adjusted OIBDA are not
measurements under accounting principles generally accepted in
the United States, may not be
similar to consolidated OIBDA and consolidated adjusted OIBDA
measures of other companies and should be considered in addition
to, but not as substitutes for, the information contained in our
statements of operations. We believe that consolidated OIBDA and
consolidated adjusted OIBDA provide useful information to investors
because they are indicators of our operating performance,
especially in a capital intensive industry such as ours, since they
exclude items that are not directly attributable to ongoing
business operations. Consolidated OIBDA and consolidated adjusted
OIBDA can be reconciled to our consolidated statements of
operations as follows (in millions):
NII Holdings,
Inc
|
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
Three Months
Ended
June
30,
|
|
Six Months
Ended
June
30,
|
|
2016
|
|
|
2015
|
|
2016
|
|
|
2015
|
Consolidated
operating loss
|
$
|
(28.8)
|
|
|
|
$
|
(198.1)
|
|
|
$
|
(82.8)
|
|
|
|
$
|
(303.9)
|
|
Consolidated
depreciation
|
29.7
|
|
|
|
60.7
|
|
|
59.8
|
|
|
|
126.8
|
|
Consolidated
amortization
|
11.0
|
|
|
|
13.0
|
|
|
21.0
|
|
|
|
27.1
|
|
Consolidated
operating income (loss) before
depreciation and amortization
|
11.9
|
|
|
|
(124.4)
|
|
|
(2.0)
|
|
|
|
(150.0)
|
|
Reversal of accrued
tax contingency
|
(8.1)
|
|
|
|
—
|
|
|
(8.1)
|
|
|
|
—
|
|
Asset impairment
charges
|
7.3
|
|
|
|
25.3
|
|
|
8.2
|
|
|
|
31.1
|
|
Restructuring
charges
|
3.3
|
|
|
|
4.2
|
|
|
8.3
|
|
|
|
5.7
|
|
Consolidated adjusted
operating income (loss)
before
depreciation and amortization
|
$
|
14.4
|
|
|
|
$
|
(94.9)
|
|
|
$
|
6.4
|
|
|
|
$
|
(113.2)
|
|
|
|
|
|
|
|
|
|
|
|
Average Monthly Revenue Per Handset/Unit in Service
(ARPU)
Average monthly revenue per subscriber unit in service, or ARPU,
is an industry term that measures service revenues, which we refer
to as subscriber revenues, per period from our customers divided by
the weighted average number of subscriber units in commercial
service during that period. ARPU is not a measurement under
accounting principles generally accepted in the United States, may not be similar to ARPU
measures of other companies and should be considered in addition,
but not as a substitute for, the information contained in our
statements of operations. We believe that ARPU provides
useful information concerning the appeal of our rate plans and
service offerings and our performance in attracting and retaining
high value customers. Other revenue includes revenues for
such services as roaming, handset maintenance, cancellation fees,
analog and other. ARPU can be calculated as follows (in
millions, except ARPU):
Nextel
Brazil
|
|
|
|
|
|
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
|
Three Months
Ended
June 30,
|
|
|
2016
|
|
|
2015
|
|
|
|
|
|
|
|
Service and other
revenues
|
$
|
243.1
|
|
|
|
$
|
303.2
|
|
|
Less: other
revenues
|
(22.1)
|
|
|
|
(34.3)
|
|
|
Total subscriber
revenues
|
$
|
221.0
|
|
|
|
$
|
268.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ARPU
calculated with subscriber revenues
|
$
|
19
|
|
|
|
$
|
20
|
|
|
|
|
|
|
|
|
ARPU
calculated with service and other revenues
|
$
|
21
|
|
|
|
$
|
23
|
|
|
|
|
|
|
|
|
Cost per Gross Add (CPGA)
Cost per gross add, or CPGA, is an industry term that is
calculated by dividing our selling, marketing and handset and
accessory subsidy costs, excluding costs unrelated to initial
customer acquisition, by our new subscribers during the period, or
gross adds. CPGA is not a measurement under accounting
principles generally accepted in the
United States, may not be similar to CPGA measures of other
companies and should be considered in addition, but not as a
substitute for, the information contained in our statements of
operations. We believe CPGA is a measure of the relative cost
of customer acquisition. CPGA can be calculated as follows
(in millions, except CPGA):
Nextel
Brazil
|
|
|
|
|
|
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
|
Three Months
Ended
June 30,
|
|
|
2016
|
|
|
2015
|
|
|
|
|
|
|
|
Consolidated handset
and accessory revenues
|
$
|
6.1
|
|
|
|
$
|
17.1
|
|
|
Less: consolidated
uninsured handset replacement
revenues
|
—
|
|
|
|
(0.1)
|
|
|
Consolidated handset
and accessory revenues, net
|
6.1
|
|
|
|
17.0
|
|
|
Less: consolidated
cost of handsets and accessories
|
8.9
|
|
|
|
65.4
|
|
|
Consolidated handset subsidy costs
|
2.8
|
|
|
|
48.4
|
|
|
Consolidated selling
and marketing
|
28.0
|
|
|
|
56.5
|
|
|
Costs per statement
of operations
|
30.8
|
|
|
|
104.9
|
|
|
Less: consolidated
costs unrelated to initial customer
acquisition
|
(1.7)
|
|
|
|
(5.8)
|
|
|
Customer acquisition costs
|
$
|
29.1
|
|
|
|
$
|
99.1
|
|
|
|
|
|
|
|
|
Cost per Gross
Add
|
$
|
99
|
|
|
|
$
|
207
|
|
|
|
|
|
|
|
|
Cash Cost per Handset/User
Cash cost per handset/unit, or CCPU, represents the sum of cost
of service, general and administrative expenses and customer
retention and other costs divided by average handsets in service
during the period and divided by the number of months in the
period. CCPU is not a measurement under accounting principles
generally accepted in the United
States, may not be similar to CCPU measures of other
companies and should not be considered in addition to, but not as a
substitute for, the information contained in our statements of
operations. We believe CCPU is a measure of the recurring
costs we incur on a monthly basis to provide service to our
subscribers. The CCPU calculation excludes material asset
impairments, severance costs associated with publicly announced
restructuring plans and other material non-recurring or unusual
charges and is calculated as follows (in thousands, except
CCPU):
Nextel
Brazil
|
|
|
|
|
|
|
|
Successor
Company
|
|
|
Predecessor
Company
|
|
|
Three Months
Ended
June 30,
|
|
|
2016
|
|
|
2015
|
|
|
|
|
|
|
|
Total selling,
general and administrative expenses
|
$
|
126.1
|
|
|
|
$
|
207.7
|
|
|
Less: selling and
marketing expenses
|
(28.0)
|
|
|
|
(56.5)
|
|
|
General and
administrative expenses
|
98.1
|
|
|
|
151.2
|
|
|
Cost of
service
|
90.0
|
|
|
|
126.0
|
|
|
Customer retention
costs and other
|
1.7
|
|
|
|
5.8
|
|
|
Total
|
$
|
189.8
|
|
|
|
$
|
283.0
|
|
|
|
|
|
|
|
|
Cash Cost per
User
|
$
|
16
|
|
|
|
$
|
21
|
|
|
|
|
|
|
|
|
Impact of Foreign Currency Fluctuations
The following table shows the impact of changes in foreign
currency exchange rates on certain financial measures for the three
and six months ended June 30, 2015
compared to the same periods in 2016 by (i) adjusting the relevant
measures for the three and six months ended June 30, 2015 to levels that would have resulted
if the average foreign currency exchange rates for the three and
six months ended June 30, 2015 were
the same as the average foreign currency exchange rates that were
in effect for the three and six months ended June 30, 2016; and (ii) comparing the actual and
adjusted financial measures for the three and six months ended
June 30, 2015 to the similar
financial measures for the three and six months ended June 30, 2016 to show the percentage change in
those measures before and after taking those adjustments into
account. The amounts reflected in the following table for operating
income before depreciation and amortization on a consolidated basis
and segment earnings for Nextel Brazil, before the adjustments for
changes in foreign currency exchange rates, are based on the
calculations contained elsewhere in these non-GAAP reconciliations
for the three and six months ended June 30,
2016 and 2015. The average foreign currency exchange rates
for each of the relevant currencies during each of the three and
six months ended June 30, 2016 and
2015 are included in the notes to the table below. The information
reflected in the following table is not a measurement under
accounting principles generally accepted in the United States and should be considered in
addition to, but not as a substitute for, the information contained
in our statements of operations. We believe that these calculations
provide useful information concerning our relative performance for
the three and six months ended June 30,
2016 compared to the same periods in 2015 by removing the
impact of the significant difference in the average foreign
currency exchange rates in effect for those periods.
NII Holdings,
Inc
|
(dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
Predecessor
Company
|
|
|
Successor
Company
|
|
|
|
Three Months Ended
June 30,
|
|
|
Three Months Ended
June 30,
|
|
|
|
2Q 2015
Actual
|
2Q 2015
Adjustment (1)
|
2Q 2015
Normalized (1)
|
|
|
2Q 2016
Actual
|
2Q
2015
to 2Q
2016
Actual B(W)
Growth (2)
|
2Q
2015
to 2Q
2016
Normalized
B(W) Growth
(3)
|
|
|
|
|
|
|
|
|
|
Consolidated:
|
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
320,303
|
|
$
|
(40,146)
|
|
$
|
280,157
|
|
|
|
$
|
249,213
|
|
(22)%
|
(11)%
|
Adjusted
operating (loss) income
before depreciation and
amortization
|
(94,870)
|
|
9,873
|
|
(84,997)
|
|
|
|
14,387
|
|
115%
|
117%
|
Nextel
Brazil:
|
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
320,255
|
|
$
|
(40,146)
|
|
$
|
280,109
|
|
|
|
$
|
249,168
|
|
(22)%
|
(11)%
|
Adjusted
operating (loss) income
before depreciation and
amortization
|
(78,757)
|
|
9,873
|
|
(68,884)
|
|
|
|
24,123
|
|
131%
|
135%
|
NII Holdings,
Inc
|
(dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
Predecessor
Company
|
|
|
Successor
Company
|
|
|
|
Six Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
|
|
|
YTD 2015
Actual
|
YTD 2015
Adjustment (1)
|
YTD 2015
Normalized (1)
|
|
|
YTD 2016
Actual
|
YTD
2015
to YTD
2016
B(W) Growth
(2)
|
YTD
2015
to YTD
2016
Normalized
B(W)
Growth
(3)
|
|
|
|
|
|
|
|
|
|
Consolidated:
|
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
683,711
|
|
$
|
(136,354)
|
|
$
|
547,357
|
|
|
|
$
|
475,770
|
|
(30)%
|
(13)%
|
Adjusted
operating (loss) income
before depreciation and
amortization
|
(113,216)
|
|
15,006
|
|
(98,210)
|
|
|
|
6,343
|
|
106%
|
106%
|
Nextel
Brazil:
|
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
683,611
|
|
$
|
(136,354)
|
|
$
|
547,257
|
|
|
|
$
|
475,671
|
|
(30)%
|
(13)%
|
Adjusted
operating (loss) income
before depreciation and
amortization
|
(75,234)
|
|
15,006
|
|
(60,228)
|
|
|
|
27,883
|
|
137%
|
146%
|
(1) The "2Q 2015 Normalized" and "YTD 2015
Normalized" amounts reflect the impact of applying the average
foreign currency exchange rates for the three and six months ended
June 30, 2016 to the operating
revenues earned in foreign currencies and to the other components
of each of the actual financial measures shown above for the three
and six months ended June 30, 2015,
other than certain components of those measures consisting of U.S.
dollar-based operating expenses, which were not adjusted. The
amounts included under the columns "2Q 2015 Adjustment" and "YTD
2015 Adjustment" reflect the amount determined by subtracting the
"2Q 2015 Normalized" and "YTD 2015 Normalized" amounts calculated
as described in the preceding sentence from the "2Q 2015 Actual"
and "YTD 2015 Actual" amounts and reflect the impact of the
year-over-year change in the average foreign currency exchange
rates on each of the financial measures for the three and six
months ended June 30, 2016. The
average foreign currency exchange rates for each of the relevant
currencies during the three and six months ended June 30, 2016 and 2015 for purposes of these
calculations were as follows:
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Brazilian
real
|
3.51
|
|
3.07
|
|
3.71
|
|
2.97
|
(2) The percentage amounts in these columns reflect the
better, or B, or worse, or W, growth rates for each of the
financial measures comparing the amounts in the "2Q 2016 Actual"
and "YTD 2016 Actual" columns with those in the "2Q 2015 Actual"
and "YTD 2015 Actual" columns.
(3) The percentage amounts in these columns reflect
the the better, or B, or worse, or W, growth rates for each
of the financial measures comparing the amounts in the "2Q 2016
Actual" and "YTD 2016 Actual" columns with those in the "2Q 2015
Normalized" and "YTD 2015 Normalized" columns.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/nii-holdings-reports-second-quarter-2016-results-300312241.html
SOURCE NII Holdings, Inc.