NII Holdings Reports Quarterly Financials
Friday, November 10, 2017 | Comments

NII Holdings 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 operating income before depreciation and amortization (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.

NII Holdings reported 32,000 3G/4G net subscriber losses in the quarter and 100,000 subscriber losses on the company's iDEN network. The company 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 CEO. "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 monthly service average revenue per subscriber (ARPU) for the third quarter of 2017 was $19, a 10 percent decrease on a reported basis, and a 12 percent decrease on a constant currency basis, compared with the same quarter last year. Nextel Brazil's average monthly churn rate for the third quarter of 2017 was 4.47 percent, a 48 basis point increase compared with 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 percent increase on a constant currency basis, compared with the same quarter last year.

Nextel Brazil's cash cost per user (CCPU) was $20 for the third quarter of 2017, an 11 percent increase on a reported basis, and an 8 percent increase on a constant currency basis, compared with 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 (CFO) 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 Nov. 7, 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 discussing the terms of an extension of the option with ice group.

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