RESTON, Va., March 18, 2019 /PRNewswire/ -- NII Holdings, Inc.
[NASDAQ: NIHD] today announced its financial results for the fourth
quarter and full year of 2018. For the quarter, the Company
generated consolidated operating revenues of $142 million, a consolidated operating loss of
$10 million and consolidated adjusted
OIBDA of $2 million. The Company's
consolidated adjusted OIBDA excludes the impact of non-cash asset
impairments, restructuring charges and other unusual items. For the
full year, the Company generated consolidated operating revenues of
$621 million, a consolidated
operating loss of $42 million and
consolidated adjusted OIBDA of $6
million. Capital expenditures were $24 million for the quarter and $64 million for the full year. The Company also
announced today in a separate press release the entry into an
agreement to sell Nextel Brazil, the Company's operating subsidiary
in Brazil.
For the fourth quarter of 2018, Nextel Brazil reported 3G/4G net
subscriber additions of 99,300 and 3G/4G churn of 2.62%, a 6-basis
point decrease compared to the third quarter of 2018 and an
85-basis point decrease compared to the fourth quarter of 2017.
Additionally, for the fourth quarter of 2018, Nextel Brazil's
average monthly service revenue per subscriber (ARPU) was
$14, cost per gross addition (CPGA)
was $56 and cash cost per user (CCPU)
was $12.
"Our results this quarter and for the full year 2018 reflect the
continued execution of our strategy that focuses on growing our
subscriber base by catering to value-minded customers in
Sao Paulo and Rio that appreciate
our promise on price, network performance and customer service,"
stated Roberto Rittes, Chief Executive Officer of Nextel Brazil.
"Our success in positioning our business to compete well in
Brazil is a direct result of the
hard work, sacrifice and innovative spirit that our employees have
delivered, and I want to thank them for their efforts."
At year-end, Nextel Brazil's sources of funding totaled
$281 million, including $175 million of unrestricted cash and short-term
investments and $106 million of cash
held in escrow to secure indemnification obligations in connection
with the sale of the Company's operations in Mexico.
Additional details regarding the Company's results, including a
more detailed explanation on local currency operating metrics, are
included in the Company's Annual Report on Form 10-K for the year
ended December 31, 2018 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 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
mobile communication services for individual consumers who use our
services to meet both professional and personal needs in
Brazil. NII Holdings, operating
under the Nextel brand, offers fully integrated wireless
communication tools with digital cellular voice services, data
services, international voice and data roaming services and other
value-added services. Visit NII Holdings' website
at www.nii.com.
Visit NII Holdings' news room for news and to access our
market's news center: 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 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
fund the business and meet its business plans, customer growth and
retention, pricing, network usage, operating costs, the timing of
various events, Access Industries' minority ownership in Nextel
Brazil, the economic and regulatory environment and the foreign
currency exchange rates that will prevail in 2019. 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 funds when expected, the
impact of more intense competitive conditions and changes in
economic conditions in Brazil, the
performance of the Company's network, the Company's ability to
provide services that customers want or need, 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,
2018, 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 the Company disclaims
any duty to update the information herein.
NII HOLDINGS, INC.
AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF
OPERATIONS
FOR THE THREE MONTHS AND YEARS ENDED DECEMBER 31, 2018 AND
2017
(in millions, except per share amounts)
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
|
|
|
|
|
|
|
|
|
|
Operating
revenues
Service and
other revenues
|
$
|
139.9
|
|
$
|
184.4
|
|
$
|
605.5
|
|
$
|
848.8
|
Handset and
accessory revenues
|
1.8
|
|
4.8
|
|
15.2
|
|
21.9
|
|
141.7
|
|
189.2
|
|
620.7
|
|
870.7
|
Operating
expenses
Cost of
service (exclusive of depreciation and amortization
included below)
|
67.3
|
|
88.7
|
|
287.6
|
|
370.4
|
Cost of
handsets and accessories
|
(1.0)
|
|
9.7
|
|
18.6
|
|
40.2
|
Selling,
general and administrative
|
73.3
|
|
107.1
|
|
308.8
|
|
510.2
|
Impairment,
restructuring and other charges, net
|
4.9
|
|
14.4
|
|
19.0
|
|
175.4
|
Depreciation
|
3.5
|
|
3.4
|
|
15.1
|
|
20.4
|
Amortization
|
3.3
|
|
3.6
|
|
13.5
|
|
15.0
|
|
151.3
|
|
226.9
|
|
662.6
|
|
1,131.6
|
Operating
loss
|
(9.6)
|
|
(37.7)
|
|
(41.9)
|
|
(260.9)
|
Other (expense)
income
Interest
expense, net
|
(21.6)
|
|
(27.4)
|
|
(100.5)
|
|
(118.6)
|
Interest
income
|
3.5
|
|
5.6
|
|
12.3
|
|
41.5
|
Foreign
currency transaction gains (losses), net
|
11.1
|
|
(13.5)
|
|
(49.0)
|
|
(1.3)
|
Other income
(expense), net
|
18.8
|
|
(2.4)
|
|
(7.2)
|
|
(7.5)
|
|
11.8
|
|
(37.7)
|
|
(144.4)
|
|
(85.9)
|
Income (loss) from
continuing operations before income tax benefit
|
2.2
|
|
(75.4)
|
|
(186.3)
|
|
(346.8)
|
Income tax
benefit
|
—
|
|
0.6
|
|
—
|
|
6.4
|
Net income (loss)
from continuing operations
|
2.2
|
|
(74.8)
|
|
(186.3)
|
|
(340.4)
|
Net (loss) income
from discontinued operations, net of income taxes
|
(5.5)
|
|
(1.6)
|
|
(8.4)
|
|
1.0
|
Net
loss
|
(3.3)
|
|
(76.4)
|
|
(194.7)
|
|
(339.4)
|
Net loss
attributable to noncontrolling interest
|
(3.6)
|
|
(21.7)
|
|
(51.6)
|
|
(46.3)
|
Net income (loss)
attributable to NII Holdings
|
$
|
0.3
|
|
$
|
(54.7)
|
|
$
|
(143.1)
|
|
$
|
(293.1)
|
|
|
|
|
|
|
|
|
Net income (loss)
from continuing operations per common share, basic and
diluted
|
$
|
0.02
|
|
$
|
(0.75)
|
|
$
|
(1.86)
|
|
$
|
(3.40)
|
Net (loss) income
from discontinued operations per common share, basic and
diluted
|
(0.06)
|
|
(0.02)
|
|
(0.08)
|
|
0.01
|
Net loss per
common share, basic and diluted
|
$
|
(0.04)
|
|
$
|
(0.77)
|
|
$
|
(1.94)
|
|
$
|
(3.39)
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding, basic
|
101.1
|
|
100.4
|
|
100.7
|
|
100.3
|
Weighted average
number of common shares outstanding, diluted
|
106.2
|
|
100.4
|
|
100.7
|
|
100.3
|
|
(1) 2017
amounts include the impact of the revision of certain immaterial
errors. For more information, see our Annual Report on Form 10-K
for the year ended December 31, 2018.
|
CONSOLIDATED
BALANCE SHEETS
(in millions, except par values)
|
|
|
|
|
|
December
31,
2018
|
|
December 31,
2017 (1)
|
|
|
|
|
ASSETS
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
|
142.5
|
|
$
|
193.9
|
Short-term
investments
|
32.3
|
|
16.7
|
Accounts receivable,
net of allowance for doubtful accounts of $19.6 and
$42.0
|
99.9
|
|
106.7
|
Handset and accessory
inventory
|
1.9
|
|
3.2
|
Prepaid expenses and
other
|
245.9
|
|
264.0
|
Total current
assets
|
522.5
|
|
584.5
|
Property, plant
and equipment, net
|
143.9
|
|
117.3
|
Intangible assets,
net
|
162.2
|
|
191.7
|
Other
assets
|
231.2
|
|
220.0
|
Total
assets
|
$
|
1,059.8
|
|
$
|
1,113.5
|
LIABILITIES AND
STOCKHOLDERS' DEFICIT
|
Current
liabilities
|
|
|
|
Accounts
payable
|
$
|
39.1
|
|
$
|
42.3
|
Accrued expenses and
other
|
299.0
|
|
308.1
|
Current portion of
long-term debt
|
21.4
|
|
8.0
|
Total current
liabilities
|
359.5
|
|
358.4
|
Long-term
debt
|
632.8
|
|
647.7
|
Other long-term
liabilities
|
249.1
|
|
218.6
|
Total
liabilities
|
1,241.4
|
|
1,224.7
|
Stockholders'
deficit
|
|
|
|
Common stock, par value
$0.001, 140.0 shares authorized, 101.3 shares issued
and outstanding — 2018, 100.4 shares issued and
outstanding — 2017
|
0.1
|
|
0.1
|
Paid-in
capital
|
2,143.2
|
|
2,139.3
|
Accumulated
deficit
|
(2,236.9)
|
|
(2,127.9)
|
Accumulated other
comprehensive loss
|
(8.4)
|
|
(47.2)
|
Total stockholders'
deficit
|
(102.0)
|
|
(35.7)
|
Noncontrolling
interest
|
(79.6)
|
|
(75.5)
|
Total
deficit
|
(181.6)
|
|
(111.2)
|
Total liabilities and
stockholders' deficit
|
$
|
1,059.8
|
|
$
|
1,113.5
|
CONSOLIDATED CASH
FLOW DATA
(in millions)
|
|
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
(1)
|
|
|
|
|
Cash, cash
equivalents and restricted cash, beginning of year
|
$
|
305.8
|
|
$
|
422.2
|
Net cash used in
operating activities
|
(125.6)
|
|
(87.1)
|
Net cash (used in)
provided by investing activities
|
(44.3)
|
|
18.8
|
Net cash provided by
(used in) financing activities
|
116.5
|
|
(48.7)
|
Effect of exchange
rate changes on cash, cash equivalents and
restricted cash
|
(1.7)
|
|
0.6
|
Cash, cash
equivalents and restricted cash, end of year
|
$
|
250.7
|
|
$
|
305.8
|
|
(1) 2017
amounts include the impact of the revision of certain immaterial
errors. For more information, see our Annual Report on Form 10-K
for the year ended December 31, 2018.
|
NII HOLDINGS, INC.
AND SUBSIDIARIES
OPERATING RESULTS AND METRICS
FOR THE THREE MONTHS AND YEARS ENDED DECEMBER 31, 2018 AND 2017
(1)
(UNAUDITED)
|
Nextel
Brazil
|
(dollars in
millions, except ARPU and CPGA, and subscribers in
thousands)
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Year
Ended
December
31,
|
|
|
2018
|
|
2017
(2)
|
|
2018
|
|
2017
(2)
|
|
Service and other
revenues
|
$
|
139.9
|
|
$
|
184.3
|
|
$
|
605.5
|
|
$
|
848.7
|
|
|
|
|
|
|
|
|
|
|
Handset and accessory
revenues
|
1.8
|
|
4.8
|
|
15.2
|
|
21.9
|
|
Cost of handsets and
accessories
|
1.0
|
|
(9.7)
|
|
(18.6)
|
|
(40.2)
|
|
Handset and accessory
net subsidy
|
2.8
|
|
(4.9)
|
|
(3.4)
|
|
(18.3)
|
|
Cost of service
(exclusive of depreciation and amortization)
|
(67.3)
|
|
(88.7)
|
|
(287.6)
|
|
(370.4)
|
|
Selling, general and
administrative
|
(68.8)
|
|
(104.8)
|
|
(291.5)
|
|
(485.9)
|
|
Adjusted operating
income (loss) before depreciation and amortization
|
$
|
6.6
|
|
$
|
(14.1)
|
|
$
|
23.0
|
|
$
|
(25.9)
|
|
|
|
|
|
|
|
|
|
|
Subscriber
units
|
|
|
|
|
|
|
|
|
WCDMA
|
3,306.0
|
|
2,896.1
|
|
3,306.0
|
|
2,896.1
|
|
iDEN
|
—
|
|
349.6
|
|
—
|
|
349.6
|
|
Total
subscriber units in commercial service (as of December
31)
|
3,306.0
|
|
3,245.7
|
|
3,306.0
|
|
3,245.7
|
|
|
|
|
|
|
|
|
|
|
WCDMA net subscriber
additions
|
99.3
|
|
26.8
|
|
343.6
|
|
3.6
|
|
iDEN net subscriber
losses
|
—
|
|
(76.6)
|
|
(283.3)
|
|
(395.8)
|
|
Total
net subscriber additions (losses)
|
99.3
|
|
(49.8)
|
|
60.3
|
|
(392.2)
|
|
|
|
|
|
|
|
|
|
|
Migrations from
iDEN to WCDMA
|
—
|
|
23.5
|
|
66.3
|
|
77.3
|
|
|
|
|
|
|
|
|
|
|
WCDMA subscriber
churn
|
2.62
|
%
|
|
3.47
|
%
|
|
2.61
|
%
|
|
3.57
|
%
|
|
iDEN subscriber
churn
|
—
|
|
|
6.36
|
%
|
|
NM
|
|
6.07
|
%
|
|
Churn
(%)
|
2.62
|
%
|
|
3.83
|
%
|
|
3.25
|
%
|
|
3.98
|
%
|
|
|
|
|
|
|
|
|
|
|
ARPU
(1)
|
$
|
14
|
|
$
|
18
|
|
$
|
15
|
|
$
|
19
|
|
|
|
|
|
|
|
|
|
|
CPGA
(1)
|
$
|
56
|
|
$
|
102
|
|
$
|
59
|
|
$
|
97
|
|
|
|
|
|
|
|
|
|
|
CCPU
(1)
|
$
|
12
|
|
$
|
17
|
|
$
|
13
|
|
$
|
18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_______________________________________
NM - Not Meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For
information regarding ARPU, CPGA and CCPU, see "Non-GAAP
Reconciliations for the Three Months and Years Ended December 31,
2018 and 2017" included in this release.
(2) 2017 amounts include the impact of the revision of
certain immaterial errors. For more information, see our Annual
Report on Form 10-K for the year ended December 31,
2018.
|
NON-GAAP RECONCILIATIONS
FOR THE
THREE MONTHS AND YEARS ENDED DECEMBER 31,
2018 AND 2017
(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 ongoing 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
December 31,
|
|
Year Ended
December 31,
|
|
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
|
|
Consolidated
operating loss
|
$
|
(9.6)
|
|
$
|
(37.7)
|
|
$
|
(41.9)
|
|
$
|
(260.9)
|
|
|
Consolidated
depreciation
|
3.5
|
|
3.4
|
|
15.1
|
|
20.4
|
|
|
Consolidated
amortization
|
3.3
|
|
3.6
|
|
13.5
|
|
15.0
|
|
|
Consolidated
operating loss before
depreciation and amortization
|
(2.8)
|
|
(30.7)
|
|
(13.3)
|
|
(225.5)
|
|
|
Asset impairment
charges
|
1.1
|
|
3.8
|
|
2.7
|
|
67.3
|
|
|
Restructuring
charges
|
3.8
|
|
10.6
|
|
16.3
|
|
108.1
|
|
|
Consolidated
adjusted operating
income (loss) before depreciation
and amortization
|
$
|
2.1
|
|
$
|
(16.3)
|
|
$
|
5.7
|
|
$
|
(50.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) 2017 amounts include the impact of
the revision of certain immaterial errors. For more information,
see our
Annual Report on Form 10-K for the year ended December 31,
2018.
|
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
December 31,
|
|
Year Ended
December 31,
|
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
|
|
US$
|
|
Handset and accessory
revenues
|
$
|
1.8
|
|
$
|
4.7
|
|
$
|
15.1
|
|
$
|
21.6
|
|
Less: cost of
handsets and accessories
|
(1.0)
|
|
9.7
|
|
18.6
|
|
40.2
|
|
Handset subsidy costs
|
(2.8)
|
|
5.0
|
|
3.5
|
|
18.6
|
|
Selling and marketing
*
|
19.7
|
|
29.7
|
|
75.3
|
|
108.5
|
|
Costs per statement
of operations
|
16.9
|
|
34.7
|
|
78.8
|
|
127.1
|
|
Less: costs unrelated
to initial customer acquisition
|
2.9
|
|
(1.4)
|
|
(1.5)
|
|
(5.8)
|
|
Customer acquisition costs
|
$
|
19.8
|
|
$
|
33.3
|
|
$
|
77.3
|
|
$
|
121.3
|
|
|
|
|
|
|
|
|
|
|
Cost per Gross
Add
|
$
|
56
|
|
$
|
102
|
|
$
|
59
|
|
$
|
97
|
|
|
|
|
|
|
|
|
|
|
Nextel
Brazil
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
|
|
BRL
R$
|
|
Handset and accessory
revenues
|
$
|
7.0
|
|
$
|
15.4
|
|
$
|
54.0
|
|
$
|
68.9
|
|
Less: cost of
handsets and accessories
|
(4.0)
|
|
31.8
|
|
64.1
|
|
128.6
|
|
Handset subsidy costs
|
(11.0)
|
|
16.4
|
|
10.1
|
|
59.7
|
|
Selling and marketing
*
|
74.8
|
|
96.3
|
|
274.3
|
|
346.0
|
|
Costs per statement
of operations
|
63.8
|
|
112.7
|
|
284.4
|
|
405.7
|
|
Less: costs unrelated
to initial customer acquisition
|
11.4
|
|
(4.6)
|
|
(3.8)
|
|
(18.6)
|
|
Customer acquisition costs
|
$
|
75.2
|
|
$
|
108.1
|
|
$
|
280.6
|
|
$
|
387.1
|
|
|
|
|
|
|
|
|
|
|
Cost per Gross
Add
|
$
|
212
|
|
$
|
332
|
|
$
|
213
|
|
$
|
310
|
|
|
|
|
|
|
|
|
|
|
|
* The adoption of
Accounting Standards Codification, or ASC, No. 606 resulted in the
capitalization of both direct and
indirect commissions beginning on January 1, 2018 compared to the
expensing of these types of commissions in 2017,
which resulted in a decrease in selling and marketing expenses from
2017 to 2018.
|
|
(1) 2017
amounts include the impact of the revision of certain immaterial
errors. For more information, see our Annual
Report on Form 10-K for the year ended December 31,
2018.
|
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 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
December 31,
|
|
Year Ended
December 31,
|
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
|
|
US$
|
|
Total selling,
general and administrative expenses
|
$
|
68.8
|
|
$
|
104.8
|
|
$
|
291.5
|
|
$
|
485.9
|
|
Less: selling and
marketing expenses *
|
(19.7)
|
|
(29.7)
|
|
(75.3)
|
|
(108.5)
|
|
General and
administrative expenses
|
49.1
|
|
75.1
|
|
216.2
|
|
377.4
|
|
Cost of
service
|
67.3
|
|
88.7
|
|
287.6
|
|
370.4
|
|
Customer retention
costs and other
|
(2.9)
|
|
1.4
|
|
1.5
|
|
5.8
|
|
Total
|
$
|
113.5
|
|
$
|
165.2
|
|
$
|
505.3
|
|
$
|
753.6
|
|
|
|
|
|
|
|
|
|
|
Cash Cost per
User
|
$
|
12
|
|
$
|
17
|
|
$
|
13
|
|
$
|
18
|
|
|
|
|
|
|
|
|
|
|
Nextel
Brazil
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
|
|
BRL
R$
|
|
Total selling,
general and administrative expenses
|
$
|
261.1
|
|
$
|
340.1
|
|
$
|
1,054.5
|
|
$
|
1,547.8
|
|
Less: selling and
marketing expenses *
|
(74.8)
|
|
(96.3)
|
|
(274.3)
|
|
(346.0)
|
|
General and
administrative expenses
|
186.3
|
|
243.8
|
|
780.2
|
|
1,201.8
|
|
Cost of
service
|
257.3
|
|
287.9
|
|
1,038.4
|
|
1,180.9
|
|
Customer retention
costs and other
|
(11.4)
|
|
4.6
|
|
3.8
|
|
18.6
|
|
Total
|
$
|
432.2
|
|
$
|
536.3
|
|
$
|
1,822.4
|
|
$
|
2,401.3
|
|
|
|
|
|
|
|
|
|
|
Cash Cost per
User
|
$
|
44
|
|
$
|
55
|
|
$
|
47
|
|
$
|
58
|
|
|
|
|
|
|
|
|
|
|
|
* The adoption of
Accounting Standards Codification, or ASC, No. 606 resulted in the
capitalization of both direct and indirect
commissions beginning on January 1, 2018 compared to the expensing
of these types of commissions in 2017, which resulted
in a decrease in selling and marketing expenses from 2017 to
2018.
|
|
(1) 2017
amounts include the impact of the revision of certain immaterial
errors. For more information, see our Annual Report
on Form 10-K for the year ended December 31, 2018.
|
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
months and year ended December 31,
2017 compared to the same periods in 2018 by (i) adjusting
the relevant measures for the three months and year ended
December 31, 2017 to levels that
would have resulted if the average foreign currency exchange rates
for the three months and year ended December
31, 2017 were the same as the average foreign currency
exchange rates that were in effect for the three months and year
ended December 31, 2018; and (ii)
comparing the actual and adjusted financial measures for the three
months and year ended December 31,
2017 to the similar financial measures for the three months
and year ended December 31, 2018 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 months
and year ended December 31, 2018 and
2017. The average foreign currency exchange rates for each of the
relevant currencies during each of the three months and year ended
December 31, 2018 and 2017 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 months and year ended December 31,
2018 compared to the same periods in 2017 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
December 31,
|
|
|
|
4Q 2017
Actual *
|
4Q 2017 Adjustment
(1)
|
4Q 2017 Normalized
(1)
|
|
4Q 2018
Actual
|
4Q
2017
to 4Q
2018
Actual B(W)
Growth (2)
|
4Q
2017
to 4Q
2018
Normalized
B(W)
Growth (3)
|
|
|
|
|
|
|
|
|
Consolidated:
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
189,182
|
$
|
(27,931)
|
$
|
161,251
|
|
$
|
141,711
|
(25)%
|
(12)%
|
Adjusted
operating (loss) income before depreciation and
amortization
|
|
(16,323)
|
|
2,086
|
|
(14,237)
|
|
|
2,015
|
112%
|
114%
|
Nextel
Brazil:
|
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
189,159
|
$
|
(27,931)
|
$
|
161,228
|
|
$
|
141,711
|
(25)%
|
(12)%
|
Adjusted
operating (loss) income before depreciation and
amortization
|
|
(14,129)
|
|
2,086
|
|
(12,043)
|
|
|
6,568
|
146%
|
155%
|
NII Holdings,
Inc.
|
(dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
Year Ended
December 31,
|
|
|
|
YTD 2017 Actual
*
|
YTD 2017
Adjustment (1)
|
YTD 2017
Normalized (1)
|
|
YTD 2018
Actual
|
YTD
2017
to YTD
2018
B(W) Growth
(2)
|
YTD
2017
to YTD
2018
Normalized
B(W)
Growth
(3)
|
|
|
|
|
|
|
|
|
Consolidated:
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
870,694
|
$
|
(112,111)
|
$
|
758,583
|
|
$
|
620,697
|
(29)%
|
(18)%
|
Adjusted
operating (loss) income before depreciation and
amortization
|
(50,116)
|
3,341
|
(46,775)
|
|
5,700
|
111%
|
112%
|
Nextel
Brazil:
|
|
|
|
|
|
|
|
Operating
revenues
|
$
|
870,588
|
$
|
(112,111)
|
$
|
758,477
|
|
$
|
620,675
|
(29)%
|
(18)%
|
Adjusted
operating (loss) income before depreciation and
amortization
|
(25,942)
|
3,341
|
(22,601)
|
|
23,004
|
189%
|
202%
|
|
* 2017 amounts
include the impact of the revision of certain immaterial errors.
For more information, see our Annual Report on Form 10-K for the
year
ended December 31, 2018.
|
1. The "4Q 2017
Normalized" and "YTD 2017 Normalized" amounts reflect the impact of
applying the average foreign currency exchange rates for the three
months and year ended December 31,
2018 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 months and year ended
December 31, 2017, 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 "4Q 2017 Normalized" and "YTD 2017 Normalized"
reflect the amount determined by adding the "4Q 2017 Adjustment"
and "YTD 2017 Adjustment" amounts calculated as described in the
preceding sentence to the "4Q 2017 Actual" and "YTD 2017 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 months and year ended December 31, 2018. The average foreign currency
exchange rates for each of the relevant currencies during the three
months and year ended December 31,
2018 and 2017 for purposes of these calculations were as
follows:
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Brazilian
real
|
3.81
|
|
3.25
|
|
3.66
|
|
3.19
|
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 "4Q 2018 Actual" and "YTD 2018 Actual" columns with
those in the "4Q 2017 Actual" and "YTD 2017 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 "4Q 2018 Actual" and "YTD 2018 Actual"
columns with those in the "4Q 2017 Normalized" and "YTD 2017
Normalized" columns.
Additional Information
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
December 31,
|
|
Year Ended
December 31,
|
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
|
|
US$
|
|
Service and other
revenues
|
$
|
139.9
|
|
$
|
184.3
|
|
$
|
605.5
|
|
$
|
848.7
|
|
Less: other
revenues
|
(2.9)
|
|
(12.5)
|
|
(19.5)
|
|
(63.2)
|
|
Total subscriber
revenues
|
$
|
137.0
|
|
$
|
171.8
|
|
$
|
586.0
|
|
$
|
785.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ARPU
calculated with subscriber revenues
|
$
|
14
|
|
$
|
18
|
|
$
|
15
|
|
$
|
19
|
|
|
|
|
|
|
|
|
|
|
ARPU calculated with service and
other
revenues
|
$
|
14
|
|
$
|
19
|
|
$
|
16
|
|
$
|
21
|
|
|
|
|
|
|
|
|
|
|
Nextel
Brazil
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
December 31,
|
|
Year Ended
December 31,
|
|
|
2018
|
|
2017
(1)
|
|
2018
|
|
2017
(1)
|
|
|
BRL
R$
|
|
Service and other
revenues
|
$
|
532.4
|
|
$
|
598.7
|
|
$
|
2,193.2
|
|
$
|
2,706.6
|
|
Less: other
revenues
|
(11.0)
|
|
(40.6)
|
|
(69.8)
|
|
(201.5)
|
|
Total subscriber
revenues
|
$
|
521.4
|
|
$
|
558.1
|
|
$
|
2,123.4
|
|
$
|
2,505.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ARPU
calculated with subscriber revenues
|
$
|
53
|
|
$
|
57
|
|
$
|
55
|
|
$
|
61
|
|
|
|
|
|
|
|
|
|
|
ARPU calculated with service and
other
revenues
|
$
|
54
|
|
$
|
61
|
|
$
|
57
|
|
$
|
66
|
|
|
|
|
|
|
|
|
|
|
|
(1) 2017
amounts include the impact of the revision of certain immaterial
errors. For more information, see our Annual
Report on Form 10-K for the year ended December 31,
2018.
|
View original
content:http://www.prnewswire.com/news-releases/nii-holdings-reports-2018-fourth-quarter-and-year-end-results-300813777.html
SOURCE NII Holdings, Inc.