NII Holdings’ Q1 net income slips 90% on higher costs

27 Apr 2012

US-based digital trunking firm NII Holdings, which provides wireless services under the Nextel brand in Brazil, Mexico, Argentina, Peru and Chile, has announced its consolidated financial results for the three months ended 31 March 2012. The company said it generated consolidated operating revenues of USD1.63 billion in the first quarter of 2012, almost flat compared to the USD1.62 billion recorded in the year-ago period. Consolidated operating income before depreciation and amortisation (OIBDA) fell 17% from USD430.9 million in Q1 2011 to USD357.7 million, while net income plummeted from USD96.8 million to USD10.9 million over the same period, a year-on-year fall of 90%. The firm said its results were affected by a number of factors, including an increase in operating costs relating to the deployment of its new W-CDMA-based networks, and pricing pressures driven by a challenging competitive environment in Brazil. Capital expenditure totalled USD234 million in the first three months of 2012.

NII Holdings added 260,100 net subscribers in Q1 2012, bringing its total customer base to 10.97 million, an increase of 16% year-on-year. The majority of net subscriber additions were witnessed in Brazil (111,600, lifting the unit’s total mobile customer base to 4.23 million at 31 March 2012), followed by Mexico (63,500, 3.76 million), Argentina (59,000, 1.45 million) and Peru (14,600, 1.45 million). ‘Our consolidated operating results for the first quarter reflect our progress on our key priorities that support our long-range business goals and the challenges we are facing in some of our markets. We are striving to generate the best balance of growth and profitability as we invest for our future,’ said Steve Dussek, NII Holdings’ CEO, adding: ‘During the quarter, we made progress toward launching our planned 3G networks and investing in our distribution channels and support systems. We also completed enhancements to our 3G PTT service, and we are ready to move forward with the broader launch of 3G services in Peru beginning in May.’

United States, NII Holdings