RESTON, Va., Nov. 9, 2017 /PRNewswire/ --
- Operating revenues of $205
million for the third quarter
- Operating loss of $83
million for the third quarter
-
- Third quarter results include $39
million of non-cash asset impairment and restructuring
charges
- Adjusted operating loss before depreciation and
amortization (adjusted OIBDA loss) of $37
million for the third quarter
- Quarter-end unrestricted cash and short-term investments
of $260 million and $110 million of cash held in escrow
- Ended third quarter 2017 with 2.85 million 3G/4G
subscribers, a 4% increase year-over-year
NII Holdings, Inc. (NASDAQ: NIHD) today announced its financial
results for the third quarter of 2017. For the quarter, the Company
generated consolidated operating revenues of $205 million, a consolidated operating loss of
$83 million and consolidated adjusted
OIBDA loss of $37 million. The
Company's consolidated adjusted OIBDA excludes the impact of
non-cash asset impairments, restructuring charges and other unusual
items. Capital expenditures were $12
million for the quarter. The Company reported 32,000 3G/4G
net subscriber losses in the quarter and 100,000 subscriber losses
on the Company's iDEN network. It ended the third quarter with 2.85
million 3G/4G subscribers and 450,000 iDEN subscribers.
"Our results this quarter were impacted by continued pressure on
our revenues from both competitive forces and the wind down of our
iDEN business," said Roberto Rittes, Nextel Brazil's Chief
Executive Officer. "We have launched new commercial offers that
positively impacted our gross adds for the quarter and are taking
actions that we believe will improve our cost structure, limit
spending and reduce churn."
Nextel Brazil's average monthly service revenue per subscriber
(ARPU) for the third quarter of 2017 was $19, a 10% decrease on a reported basis, and a
12% decrease on a constant currency basis, compared to the same
quarter last year. Nextel Brazil's average monthly churn rate for
the third quarter of 2017 was 4.47%, a 48 basis point increase
compared to the same quarter last year. Nextel Brazil's cost per
gross addition (CPGA) was $100 for
the third quarter of 2017, a $7
increase on a reported basis, and a 5% increase on a constant
currency basis, compared to the same quarter last year. Nextel
Brazil's cash cost per user (CCPU) was $20 for the third quarter of 2017, an 11%
increase on a reported basis, and an 8% increase on a constant
currency basis, compared to the same quarter last year.
At quarter-end, the Company's sources of funding totaled
$422 million, including $260 million of unrestricted cash and short-term
investments, $110 million of cash
held in escrow to secure indemnification obligations in connection
with the sale of Nextel Mexico and $52
million in cash pledged as collateral to secure certain
performance bonds in Brazil.
"Despite the OIBDA loss reported this quarter, we managed to
limit operational free cash flow burn," said Dan Freiman, Chief Financial Officer of NII
Holdings. "With the signing of amendments to our loan agreements in
Brazil behind us, we are focused
on executing on our business plan and putting Nextel Brazil back on
a growth path."
On November 7, 2017, ice group,
formerly AINMT, requested an extension of time to exercise its
option to invest an additional $150
million in Nextel Holdings, the Company's newly formed
subsidiary that indirectly owns Nextel Brazil. The Company is
currently discussing the terms of an extension of the option with
ice group.
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 September 30, 2017
that was filed with the Securities and Exchange Commission today.
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, final approval and
effectiveness of amendments to loan agreements, the completion of
ice group's second investment, which is at ice group's sole
discretion, and 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
receipt of approval of amendments by China's export and credit insurance
corporation, ice group's decision to exercise its investment
option, the Company's ability to fund the business and 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 the remainder of 2017. 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, including the
inability to access escrowed and pledged funds when expected, our
ability to finalize the executed amendments to our financing
arrangements, a decision by ice group not to exercise its option,
failing to meet the closing conditions necessary to complete ice
group's investment, 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, 2016 and the Quarterly
Report on Form 10-Q for the period ended June 30, 2017, 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
NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016
|
(in millions,
except per share amounts)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Operating
revenues
Service and
other revenues
|
$
|
200.3
|
|
|
$
|
255.7
|
|
|
$
|
663.8
|
|
|
$
|
719.4
|
|
Handset and
accessory revenues
|
4.5
|
|
|
5.1
|
|
|
17.1
|
|
|
17.2
|
|
|
204.8
|
|
|
260.8
|
|
|
680.9
|
|
|
736.6
|
|
Operating
expenses
Cost of
service (exclusive of depreciation and amortization
included below)
|
94.0
|
|
|
96.5
|
|
|
284.6
|
|
|
268.5
|
|
Cost of
handsets and accessories
|
8.7
|
|
|
5.8
|
|
|
30.4
|
|
|
25.8
|
|
Selling,
general and administrative
|
139.0
|
|
|
142.8
|
|
|
403.1
|
|
|
412.1
|
|
Impairment,
restructuring and other charges
|
39.2
|
|
|
1,324.2
|
|
|
165.3
|
|
|
1,340.7
|
|
Depreciation
|
3.6
|
|
|
66.3
|
|
|
18.2
|
|
|
126.1
|
|
Amortization
|
3.7
|
|
|
11.9
|
|
|
11.5
|
|
|
32.9
|
|
|
288.2
|
|
|
1,647.5
|
|
|
913.1
|
|
|
2,206.1
|
|
Operating
loss
|
(83.4)
|
|
|
(1,386.7)
|
|
|
(232.2)
|
|
|
(1,469.5)
|
|
Other (expense)
income
Interest
expense, net
|
(33.3)
|
|
|
(29.5)
|
|
|
(91.2)
|
|
|
(81.9)
|
|
Interest
income
|
19.0
|
|
|
9.2
|
|
|
35.9
|
|
|
29.7
|
|
Foreign
currency transaction gains (losses), net
|
14.2
|
|
|
(5.2)
|
|
|
12.2
|
|
|
77.8
|
|
Other expense,
net
|
(10.9)
|
|
|
(2.1)
|
|
|
(5.5)
|
|
|
(7.0)
|
|
|
(11.0)
|
|
|
(27.6)
|
|
|
(48.6)
|
|
|
18.6
|
|
Loss from
continuing operations before reorganization
items and income tax provision
|
(94.4)
|
|
|
(1,414.3)
|
|
|
(280.8)
|
|
|
(1,450.9)
|
|
Reorganization
items
|
—
|
|
|
(0.1)
|
|
|
0.4
|
|
|
(0.7)
|
|
Income tax
benefit
|
—
|
|
|
2.8
|
|
|
5.8
|
|
|
2.5
|
|
Net loss from
continuing operations
|
(94.4)
|
|
|
(1,411.6)
|
|
|
(274.6)
|
|
|
(1,449.1)
|
|
Net (loss) income
from discontinued operations, net of
income taxes
|
(0.1)
|
|
|
(7.4)
|
|
|
2.6
|
|
|
(16.2)
|
|
Net
loss
|
(94.5)
|
|
|
(1,419.0)
|
|
|
(272.0)
|
|
|
(1,465.3)
|
|
Net loss
attributable to noncontrolling interest
|
(27.3)
|
|
|
—
|
|
|
(27.3)
|
|
|
—
|
|
Net loss
attributable to NII Holdings
|
$
|
(67.2)
|
|
|
$
|
(1,419.0)
|
|
|
$
|
(244.7)
|
|
|
$
|
(1,465.3)
|
|
|
|
|
|
|
|
|
|
Net loss from
continuing operations per common share,
basic and diluted
|
$
|
(0.94)
|
|
|
$
|
(14.10)
|
|
|
$
|
(2.74)
|
|
|
$
|
(14.49)
|
|
Net (loss) income
from discontinued operations per common
share, basic and diluted
|
—
|
|
|
(0.07)
|
|
|
0.03
|
|
|
(0.16)
|
|
Net loss per
common share, basic and diluted
|
$
|
(0.94)
|
|
|
$
|
(14.17)
|
|
|
$
|
(2.71)
|
|
|
$
|
(14.65)
|
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding,
basic and diluted
|
100.4
|
|
|
100.1
|
|
|
100.3
|
|
|
100.1
|
|
CONSOLIDATED
BALANCE SHEETS
|
(in millions,
except par values)
|
|
|
September 30,
2017
|
|
December 31,
2016
|
|
|
|
|
ASSETS
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
234.7
|
|
|
$
|
257.4
|
|
Short-term
investments
|
24.9
|
|
|
73.9
|
|
Accounts receivable,
net of allowance for doubtful accounts of $53.3 and
$54.2
|
126.0
|
|
|
153.8
|
|
Handset and accessory
inventory
|
2.9
|
|
|
8.3
|
|
Prepaid expenses and
other
|
230.0
|
|
|
280.1
|
|
Total current
assets
|
618.5
|
|
|
773.5
|
|
Property, plant
and equipment, net
|
107.5
|
|
|
129.5
|
|
Intangible assets,
net
|
206.2
|
|
|
243.7
|
|
Other
assets
|
251.4
|
|
|
271.8
|
|
Total
assets
|
$
|
1,183.6
|
|
|
$
|
1,418.5
|
|
LIABILITIES AND
STOCKHOLDERS' (DEFICIT) EQUITY
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$
|
48.7
|
|
|
$
|
69.2
|
|
Accrued expenses and
other
|
280.9
|
|
|
271.9
|
|
Deferred
revenues
|
7.7
|
|
|
11.6
|
|
Current portion of
long-term debt
|
460.3
|
|
|
540.5
|
|
Total current
liabilities
|
797.6
|
|
|
893.2
|
|
Long-term
debt
|
216.0
|
|
|
215.8
|
|
Other long-term
liabilities
|
230.6
|
|
|
143.5
|
|
Total
liabilities
|
1,244.2
|
|
|
1,252.5
|
|
Stockholders'
equity
|
|
|
|
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, 100.4 shares issued
and
outstanding — 2017, 100.3 shares issued and
outstanding — 2016
|
0.1
|
|
|
0.1
|
|
Paid-in
capital
|
2,139.8
|
|
|
2,076.6
|
|
Accumulated
deficit
|
(2,079.4)
|
|
|
(1,834.8)
|
|
Accumulated other
comprehensive loss
|
(59.3)
|
|
|
(75.9)
|
|
Total stockholders'
equity
|
1.2
|
|
|
166.0
|
|
Noncontrolling
interest
|
(61.8)
|
|
|
—
|
|
Total (deficit)
equity
|
(60.6)
|
|
|
166.0
|
|
Total liabilities and
stockholders' (deficit) equity
|
$
|
1,183.6
|
|
|
$
|
1,418.5
|
|
CONSOLIDATED CASH
FLOW DATA
|
(in
millions)
|
|
|
Nine Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
|
|
|
Cash and cash
equivalents, beginning of period
|
$
|
257.4
|
|
|
$
|
342.2
|
|
Net cash used in
operating activities
|
(58.8)
|
|
|
(74.9)
|
|
Net cash provided by
investing activities
|
76.9
|
|
|
96.9
|
|
Net cash used in
financing activities
|
(41.3)
|
|
|
(72.9)
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
0.5
|
|
|
(1.6)
|
|
Cash and cash
equivalents, end of period
|
$
|
234.7
|
|
|
$
|
289.7
|
|
NII HOLDINGS, INC.
AND SUBSIDIARIES
|
OPERATING RESULTS
AND METRICS
|
FOR THE THREE AND
NINE MONTHS ENDED SEPTEMBER 30, 2017 AND 2016 (1)
|
(UNAUDITED)
|
|
Nextel
Brazil
|
(dollars in
millions, except ARPU and CPGA, and subscribers in
thousands)
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September
30,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Service and other
revenues
|
$
|
200.2
|
|
|
$
|
255.7
|
|
|
$
|
663.7
|
|
|
$
|
719.3
|
|
|
|
|
|
|
|
|
|
|
|
Handset and accessory
revenues
|
4.5
|
|
|
5.1
|
|
|
17.1
|
|
|
17.2
|
|
|
Cost of handsets and
accessories
|
(8.7)
|
|
|
(5.8)
|
|
|
(30.4)
|
|
|
(25.8)
|
|
|
Handset and accessory
net subsidy
|
(4.2)
|
|
|
(0.7)
|
|
|
(13.3)
|
|
|
(8.6)
|
|
|
Cost of service
(exclusive of depreciation and amortization)
|
(94.0)
|
|
|
(96.5)
|
|
|
(284.6)
|
|
|
(268.5)
|
|
|
Selling, general and
administrative
|
(132.7)
|
|
|
(134.9)
|
|
|
(381.0)
|
|
|
(382.5)
|
|
|
Segment (losses)
earnings
|
(30.7)
|
|
|
23.6
|
|
|
(15.2)
|
|
|
59.7
|
|
|
Reversal of accrued
tax contingency
|
—
|
|
|
—
|
|
|
—
|
|
|
(8.1)
|
|
|
Adjusted operating
(loss) income before depreciation and
amortization
|
$
|
(30.7)
|
|
|
$
|
23.6
|
|
|
$
|
(15.2)
|
|
|
$
|
51.6
|
|
|
|
|
|
|
|
|
|
|
|
Subscriber
units
|
|
|
|
|
|
|
|
|
iDEN
|
449.7
|
|
|
962.1
|
|
|
|
|
|
|
WCDMA
|
2,845.8
|
|
|
2,746.3
|
|
|
|
|
|
|
Total
subscriber units in commercial service (as of September
30)
|
3,295.5
|
|
|
3,708.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
iDEN net subscriber
losses
|
(100.3)
|
|
|
(130.8)
|
|
|
|
|
|
|
WCDMA net subscriber
losses
|
(32.3)
|
|
|
(5.7)
|
|
|
|
|
|
|
Total
net subscriber losses
|
(132.6)
|
|
|
(136.5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Migrations from
iDEN to WCDMA
|
13.3
|
|
|
34.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
iDEN subscriber
churn
|
6.89
|
%
|
|
4.65
|
%
|
|
|
|
|
|
WCDMA subscriber
churn
|
4.04
|
%
|
|
3.73
|
%
|
|
|
|
|
|
Churn
(%)
|
4.47
|
%
|
|
3.99
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ARPU
(1)
|
$
|
19
|
|
|
$
|
21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CPGA
(1)
|
$
|
100
|
|
|
$
|
93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CCPU
(1)
|
$
|
20
|
|
|
$
|
18
|
|
|
|
|
|
|
|
(1) For
information regarding ARPU, CPGA and CCPU, see "Non-GAAP
Reconciliations for the Three and Nine Months Ended September 30,
2017 and 2016" included in this release.
|
NON-GAAP RECONCILIATIONS
FOR THE
THREE AND NINE MONTHS ENDED SEPTEMBER 30,
2017 AND 2016
(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
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Consolidated
operating loss
|
$
|
(83.4)
|
|
|
$
|
(1,386.7)
|
|
|
$
|
(232.2)
|
|
|
$
|
(1,469.5)
|
|
Consolidated
depreciation
|
3.6
|
|
|
66.3
|
|
|
18.2
|
|
|
126.1
|
|
Consolidated
amortization
|
3.7
|
|
|
11.9
|
|
|
11.5
|
|
|
32.9
|
|
Consolidated
operating loss before
depreciation and amortization
|
(76.1)
|
|
|
(1,308.5)
|
|
|
(202.5)
|
|
|
(1,310.5)
|
|
Reversal of accrued
tax contingency
|
—
|
|
|
—
|
|
|
—
|
|
|
(8.1)
|
|
Asset impairment
charges
|
(5.1)
|
|
|
1,317.6
|
|
|
63.5
|
|
|
1,325.8
|
|
Restructuring
charges
|
44.3
|
|
|
6.6
|
|
|
101.8
|
|
|
14.9
|
|
Consolidated adjusted
operating (loss) income
before depreciation and amortization
|
$
|
(36.9)
|
|
|
$
|
15.7
|
|
|
$
|
(37.2)
|
|
|
$
|
22.1
|
|
|
|
|
|
|
|
|
|
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
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
|
2017
|
|
2016
|
|
|
US$
|
|
Service and other
revenues
|
$
|
200.2
|
|
|
$
|
255.7
|
|
|
Less: other
revenues
|
(14.6)
|
|
|
(22.9)
|
|
|
Total subscriber
revenues
|
$
|
185.6
|
|
|
$
|
232.8
|
|
|
|
|
|
|
|
|
|
|
|
|
ARPU
calculated with subscriber revenues
|
$
|
19
|
|
|
$
|
21
|
|
|
|
|
|
|
|
ARPU
calculated with service and other revenues
|
$
|
20
|
|
|
$
|
23
|
|
|
|
|
|
|
|
Nextel
Brazil
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
|
2017
|
|
2016
|
|
|
BRL
R$
|
|
Service and other
revenues
|
$
|
633.7
|
|
|
$
|
830.0
|
|
|
Less: other
revenues
|
(46.2)
|
|
|
(74.4)
|
|
|
Total subscriber
revenues
|
$
|
587.5
|
|
|
$
|
755.6
|
|
|
|
|
|
|
|
|
|
|
|
|
ARPU
calculated with subscriber revenues
|
$
|
59
|
|
|
$
|
67
|
|
|
|
|
|
|
|
ARPU
calculated with service and other revenues
|
$
|
63
|
|
|
$
|
73
|
|
|
|
|
|
|
|
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
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
|
2017
|
|
2016
|
|
|
US$
|
|
Consolidated handset
and accessory revenues
|
$
|
4.5
|
|
|
$
|
5.1
|
|
|
Less: consolidated
uninsured handset replacement revenues
|
—
|
|
|
(0.1)
|
|
|
Consolidated handset
and accessory revenues, net
|
4.5
|
|
|
5.0
|
|
|
Less: consolidated
cost of handsets and accessories
|
8.7
|
|
|
5.8
|
|
|
Consolidated handset subsidy costs
|
4.2
|
|
|
0.8
|
|
|
Consolidated selling
and marketing
|
28.3
|
|
|
30.4
|
|
|
Costs per statement
of operations
|
32.5
|
|
|
31.2
|
|
|
Less: consolidated
costs unrelated to initial customer
acquisition
|
(0.9)
|
|
|
(2.0)
|
|
|
Customer acquisition costs
|
$
|
31.6
|
|
|
$
|
29.2
|
|
|
|
|
|
|
|
Cost per Gross
Add
|
$
|
100
|
|
|
$
|
93
|
|
|
|
|
|
|
|
Nextel
Brazil
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
|
2017
|
|
2016
|
|
|
BRL
R$
|
|
Consolidated handset
and accessory revenues
|
$
|
14.3
|
|
|
$
|
16.8
|
|
|
Less: consolidated
uninsured handset replacement revenues
|
(0.1)
|
|
|
(0.2)
|
|
|
Consolidated handset
and accessory revenues, net
|
14.2
|
|
|
16.6
|
|
|
Less: consolidated
cost of handsets and accessories
|
27.6
|
|
|
18.8
|
|
|
Consolidated handset subsidy costs
|
13.4
|
|
|
2.2
|
|
|
Consolidated selling
and marketing
|
89.4
|
|
|
98.8
|
|
|
Costs per statement
of operations
|
102.8
|
|
|
101.0
|
|
|
Less: consolidated
costs unrelated to initial customer
acquisition
|
(3.0)
|
|
|
(6.2)
|
|
|
Customer acquisition costs
|
$
|
99.8
|
|
|
$
|
94.8
|
|
|
|
|
|
|
|
Cost per Gross
Add
|
$
|
316
|
|
|
$
|
301
|
|
|
|
|
|
|
|
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
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
|
2017
|
|
2016
|
|
|
US$
|
|
Total selling,
general and administrative expenses
|
$
|
132.7
|
|
|
$
|
134.9
|
|
|
Less: selling and
marketing expenses
|
(28.3)
|
|
|
(30.4)
|
|
|
General and
administrative expenses
|
104.4
|
|
|
104.5
|
|
|
Cost of
service
|
94.0
|
|
|
96.5
|
|
|
Customer retention
costs and other
|
1.0
|
|
|
1.9
|
|
|
Total
|
$
|
199.4
|
|
|
$
|
202.9
|
|
|
|
|
|
|
|
Cash Cost per
User
|
$
|
20
|
|
|
$
|
18
|
|
|
|
|
|
|
|
Nextel
Brazil
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
|
2017
|
|
2016
|
|
|
BRL
R$
|
|
Total selling,
general and administrative expenses
|
$
|
419.5
|
|
|
$
|
438.0
|
|
|
Less: selling and
marketing expenses
|
(89.4)
|
|
|
(98.8)
|
|
|
General and
administrative expenses
|
330.1
|
|
|
339.2
|
|
|
Cost of
service
|
297.4
|
|
|
313.4
|
|
|
Customer retention
costs and other
|
3.0
|
|
|
6.2
|
|
|
Total
|
$
|
630.5
|
|
|
$
|
658.8
|
|
|
|
|
|
|
|
Cash Cost per
User
|
$
|
63
|
|
|
$
|
58
|
|
|
|
|
|
|
|
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 nine months ended September 30,
2016 compared to the same periods in 2017 by (i) adjusting
the relevant measures for the three and nine months ended
September 30, 2016 to levels that
would have resulted if the average foreign currency exchange rates
for the three and nine months ended September 30, 2016 were the same as the average
foreign currency exchange rates that were in effect for the three
and nine months ended September 30,
2017; and (ii) comparing the actual and adjusted financial
measures for the three and nine months ended September 30, 2016 to the similar financial
measures for the three and nine months ended September 30, 2017 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 nine months ended September 30, 2017 and 2016. The average foreign
currency exchange rates for each of the relevant currencies during
each of the three and nine months ended September 30, 2017 and 2016 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
nine months ended September 30, 2017
compared to the same periods in 2016 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)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
|
|
3Q 2016
Actual
|
3Q 2016
Adjustment
(1)
|
3Q 2016
Normalized
(1)
|
|
3Q 2017
Actual
|
3Q
2016
to 3Q
2017
Actual B(W)
Growth (2)
|
3Q
2016
to 3Q
2017
Normalized
B(W) Growth
(3)
|
|
|
|
|
|
|
|
|
Consolidated:
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
260,836
|
|
$
|
7,428
|
|
$
|
268,264
|
|
|
$
|
204,808
|
|
(21)%
|
(24)%
|
Adjusted
operating income (loss)
before depreciation and
amortization
|
15,714
|
|
673
|
|
16,387
|
|
|
(36,942)
|
|
(335)%
|
(325)%
|
Nextel
Brazil:
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
260,798
|
|
$
|
7,428
|
|
$
|
268,226
|
|
|
$
|
204,784
|
|
(21)%
|
(24)%
|
Adjusted
OIBDA
|
23,636
|
|
673
|
|
24,309
|
|
|
(30,661)
|
|
(230)%
|
(226)%
|
NII Holdings,
Inc
|
(dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30,
|
|
|
|
YTD 2016
Actual
|
YTD 2016
Adjustment
(1)
|
YTD 2016
Normalized
(1)
|
|
YTD 2017
Actual
|
YTD
2016
to YTD
2017
B(W) Growth
(2)
|
YTD
2016
to YTD
2017
Normalized
B(W)
Growth
(3)
|
|
|
|
|
|
|
|
|
Consolidated:
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
736,606
|
|
$
|
90,607
|
|
$
|
827,213
|
|
|
$
|
680,897
|
|
(8)%
|
(18)%
|
Adjusted
operating income (loss)
before depreciation and
amortization
|
22,057
|
|
6,338
|
|
28,395
|
|
|
(37,188)
|
|
(269)%
|
(231)%
|
Nextel
Brazil:
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
736,469
|
|
$
|
90,607
|
|
$
|
827,076
|
|
|
$
|
680,814
|
|
(8)%
|
(18)%
|
Adjusted
operating income (loss)
before depreciation and
amortization
|
51,519
|
|
6,338
|
|
57,857
|
|
|
(15,208)
|
|
(130)%
|
(126)%
|
(1)
|
The "3Q 2016
Normalized" and "YTD 2016 Normalized" amounts reflect the impact of
applying the average foreign currency exchange rates for the three
and nine months ended September 30, 2017 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 nine
months ended September 30, 2016, 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 "3Q
2016 Normalized" and "YTD 2016 Normalized" reflect the amount
determined by adding the "3Q 2016 Adjustment" and "YTD 2016
Adjustment" amounts calculated as described in the preceding
sentence to the "3Q 2016 Actual" and "YTD 2016 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 nine months ended September 30, 2017. The average
foreign currency exchange rates for each of the relevant currencies
during the three and nine months ended September 30, 2017 and 2016
for purposes of these calculations were as follows:
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
Brazilian
real
|
3.16
|
|
3.25
|
|
3.17
|
|
3.56
|
|
|
|
|
|
|
|
|
|
|
|
|
(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 "3Q 2017 Actual" and "YTD 2017 Actual" columns with
those in the "3Q 2016 Actual" and "YTD 2016 Actual"
columns.
|
|
|
|
|
|
|
|
(3)
|
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 "3Q 2017 Actual" and "YTD 2017 Actual" columns with
those in the "3Q 2016 Normalized" and "YTD 2016 Normalized"
columns.
|
View original
content:http://www.prnewswire.com/news-releases/nii-holdings-reports-2017-third-quarter-results-300552532.html
SOURCE NII Holdings, Inc.