NII Holdings Provides Preliminary Fourth Quarter And Full Year 2012 Results And 2013 Outlook

 NII Holdings Provides Preliminary Fourth Quarter And Full Year 2012 Results
                               And 2013 Outlook

-- Added approximately 650,000 net subscribers for the full year 2012 and
2,200 for the fourth quarter as Nextel Brazil executes customer improvement
plan

-- Generated consolidated operating income before depreciation, amortization
and non-cash impairment and restructuring charges ("adjusted OIBDA") for the
full year of between $930 million and $950 million

-- Invested approximately $1.5 billion in capital expenditures for the full
year 2012 and $525 million for the fourth quarter

PR Newswire

RESTON, Va., Feb. 5, 2013

RESTON, Va., Feb.5, 2013 /PRNewswire/ --NII Holdings, Inc. [NASDAQ: NIHD]
today announced its preliminary consolidated financial results for the fourth
quarter and full year 2012. For the fourth quarter, the Company expects to
report consolidated operating revenues of approximately $1.5 billion, net
subscriber additions of approximately 2,200, and total capital expenditures of
approximately $525 million.

(Logo: http://photos.prnewswire.com/prnh/20110919/FL70458LOGO )

For the full year 2012, the Company expects to report approximately 650,000
net subscriber additions, bringing its total year-end subscriber base to
approximately 11.4 million, an estimated 6 percent increase over year-end
2011. The Company expects to report full year 2012 consolidated operating
revenues of$6.1 billion and adjusted OIBDA of between $930 million and $950
million for the full year. The Company's adjusted OIBDA excludes the impact of
non-cash impairment and restructuring charges, including a $300 million
impairment charge related to the Company's operations in Chile described
below. Total capital expenditures for the full year 2012 are expected to be
$1.5 billion. The Company expects that it will end the year with $1.6 billion
in total cash, cash equivalents and short-term investments and total debt of
$4.9 billion, resulting in net debt of $3.3 billion. 

"While 2012 was a pivotal year for NII as we made progress in the deployment
of our 3G networks and new service offerings, we fell well short of
expectations. We intend to get back to delivering results in 2013 that meet
expectations through solid execution and have already taken steps to
streamline our business operations both at our headquarters and in our markets
consistent with that goal," said Steve Shindler, NII Holdings' chairman and
interim chief executive officer. "We are confident the investments we are
making now will enhance our competitive position and create value over the
long-term. We recognize the industry challenges facing our business today, and
we are taking steps to fortify the Company's operations to generate long-term
growth and profitability."

As planned, during the fourth quarter, Nextel Brazil took actions to remove
certain unprofitable customers from its subscriber base, which resulted in an
estimated 292,000 net subscriber loss for its operations during the fourth
quarter. The Company believes that the actions have improved the quality of
Nextel Brazil's subscriber base and will position Nextel Brazil to return to
subscriber growth starting in the first quarter of 2013. The Company expects
to report a slight increase in local currency average (service) revenue per
subscriber in Brazil for the fourth quarter compared to the third quarter of
2012. Nextel Brazil also expects to more broadly offer voice and data
services on its new 3G network in Sao Paulo by the end of the second quarter
of 2013 and in Rio de Janeiro by the end of 2013.

Nextel Mexico is expected to report 41,000 net subscriber additions for the
fourth quarter and remains on schedule to extend its 3G network coverage to
match its existing iDEN coverage by the end of the third quarter of 2013. The
Company expects to report a slight decrease in local currency average
(service) revenue per subscriber in Mexico for the fourth quarter compared to
the third quarter of 2012.

In 2013, the Company plans to continue to invest in the deployment of its 3G
networks with a particular focus on building those networks and improving
results in its core markets of Mexico and Brazil. The Company also announced
that it is continuing to support its operations in Peru, Chile and Argentina,
while also exploring strategic options for these markets, such as
partnerships, service arrangements and asset sales to maximize the value of
those businesses and generate additional liquidity. Due in part to this
change in focus and in connection with the preparation of the fourth quarter
2012 financial statements, the Company expects to recognize a non-cash asset
impairment charge of approximately $300 million related to the Company's
operations in Chile. The impact of this non-cash charge is excluded from the
Company's 2012 adjusted OIBDA results.

The Company is also in the process of pursuing a sale and leaseback ofan
aggregate of up to4,500 telecommunication towers that it ownsin Brazil and
Mexico through a competitive bidding process. The Company is currently
evaluating offers from a number of interested parties and expects to be in a
position to complete these transactions during the course of 2013. However,
there can be no assurance as to if, or when, any such transaction will occur
or the amount of proceeds, if any, that it may raise.

In 2013, the Company will continue to invest in expanding the coverage of its
new 3G platforms that will enable it to provide a broader range of products
and services, significantly expand its addressable markets to include high
value individual subscribers to complement its current corporate customer
base, and to improve its overall competitive position in its core markets.
During the year, the Company plans to provide voice and data services on its
3G network in Sao Paulo and Rio de Janeiro, and complete network coverage in
key markets in Mexico to establish network coverage parity with the Company's
iDEN network. As a result of these efforts, the Company expects additional
year-over-year expenses relating to the deployment and operation of its 3G
networks. While these additional expenses will put negative pressure on the
Company's expected adjusted OIBDA, the Company expects these investments will
position it to drive subscriber growth and profitability in future years.

Taking into consideration the plans to focus on its core markets and its 3G
deployment plans for 2013, the Company issued the following consolidated
outlook for 2013. This outlook is based upon a number of assumptions and
estimates that, while presented with numerical specificity and considered
reasonable by us, when taken as a whole, are inherently subject to significant
business, economic and competitive uncertainties, and are necessarily
speculative in nature. The actual results that the Company will achieve for
2013 could vary materially from those in this outlook.

  oConsolidated adjusted OIBDA in the range of $600 million to $650 million;
  oConsolidated revenues in the range of $5.7 billion to $5.9 billion;
  oMid-single digit growth rate for its consolidated subscriber base; and
  oTotal capital expenditures of approximately $1 billion, which represents a
    reduction in capital expenditures of approximately one-third relative to
    the prior year.

Consistent with the definition of adjusted OIBDA, which excludes the impact of
restructuring costs and non-cash asset impairment charges, the Company's
adjusted OIBDA guidance for 2013 does not reflect the impact of non-cash asset
impairment or restructuring charges that may be incurred in 2013. In January
2013, the Company began evaluating the feasibility of discontinuing the
broader use of software previously developed for use in multiple markets, and
the possibility of restricting its ongoing use to one of the Company's
markets. The Company's ultimate decision regarding the use of this software
could result in a non-cash impairment charge of up to $85 million. The
Company's 2013 adjusted OIBDA guidance does not take into account the impact
of this potential non-cash charge, as well as other potential non-cash charges
that could be required in 2013. 

The Company expects that its negative 2013 operational free cash flow, defined
as adjusted OIBDA less capital expenditures, will improve by about $200
million compared to 2012. It is the Company's goal to improve operational
free cash flow to reach breakeven, on a quarterly basis, towards the end of
2014. The Company's 2013 outlook is based on a number of key assumptions.
Actual results could differ materially if any of these assumptions prove
inaccurate. In addition, the Company's results could be materially and
adversely affected by any of the risks set forth in the "Risk Factors"
included as an exhibit to the Company's Current Report on Form 8-K dated
February 5, 2013.

"We are taking an aggressive approach to complete our 3G network deployments,
streamline our vendor relationships, improve our cost structure, and
prioritize investments in our core markets. While we expect the increase in
our 3G related operating expenses to result in a decline in our adjusted OIBDA
for 2013 as we deploy our new networks, we believe that these investments are
critical as we position the Company to be competitive for the long-term and to
drive profitable growth in the future," added Shindler.

The Company plans to release its fourth quarter and year end 2012 results on
Thursday, February 28, 2013.

The preliminary financial and operating results and estimates set forth above
reflect the most current information available to and best judgment of the
Company's management. These preliminary results and estimates are subject to
the finalization of the Company's quarterly and annual financial and
accounting procedures and should not be viewed as a substitute for full
interim or annual financial statements prepared in accordance with GAAP and
reviewed by the Company's auditors. In addition, the preliminary results and
estimates involve a number of risks and uncertainties which could cause actual
results to differ materially from those set forth above and from past results,
performance and achievements. Consequently, there can be no assurances that
the actual financial and operating results for the fourth quarter and full
year 2012 will be identical to the preliminary results or within the range of
estimates set forth above, and any variation may be material.
PricewaterhouseCoopers LLP has not audited, reviewed, compiled or performed
any procedures with respect to the preliminary financial data set forth
above. Accordingly, PricewaterhouseCoopers LLP does not express an opinion or
any other form of assurance with respect thereto.

The outlook for 2013 included in this press release has been prepared by, and
is the responsibility of, the Company's management. PricewaterhouseCoopers
LLP has neither examined, compiled nor performed any procedures with respect
to the prospective financial information contained herein and, accordingly,
PricewaterhouseCoopers LLP does not express an opinion or any other form of
assurance on such information or its achievability. PricewaterhouseCoopers LLP
assumes no responsibility for and denies any association with the prospective
financial information and any other information derived therefrom included
elsewhere in this press release.

About NII Holdings, Inc.

NII Holdings, Inc., a publicly held company based in Reston, Va., is a
provider of differentiated mobile communication services for businesses and
high value consumers in Latin America. NII Holdings, operating under the
Nextel brand in Brazil, Mexico, Argentina, Peru and Chile, offers fully
integrated wireless communications tools with digital cellular voice services,
data services, wireless Internet access and Nextel Direct Connect^® and
International Direct Connect(SM), a digital two-way radio. NII Holdings is a
Fortune 500 and Barron's 500 company, and has also been named one of the best
places to work among multinationals in Latin America by the Great Place to
Work^® Institute. The Company trades on the NASDAQ market under the symbol
NIHD. 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 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, network usage, customer growth and
retention, pricing, operating costs, the timing of various events, the
economic and regulatory environment and the foreign exchange rates that will
prevail during 2013. 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 more intense competitive conditions
and changes in economic conditions in the markets we serve; the impact on our
financial results, and potential reductions in the recorded value of our
assets, that may result from fluctuations in foreign currency exchange rates
and, in particular, fluctuations in the relative values of the currencies of
the countries in which we operate compared to the U.S. dollar; the risk that
our network technologies will not perform properly or support the services our
customers want or need, including the risk that technology developments to
support our services will not be timely delivered; the risk that customers in
the markets we serve will not find our services attractive; unexpected results
of litigation; and the additional risks and uncertainties that are described
in NII Holdings' Annual Report on Form 10-K/A for the fiscal year ended
December 31, 2011, 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.

Media Contacts:

NII Holdings, Inc.
1875 Explorer Street, Suite 1000
Reston, VA. 20190
(703) 390-5100
www.nii.com

Investor Relations:
Tim Perrott
(703) 390-5113
tim.perrott@nii.com

Media Relations:
Claudia Restrepo
(786) 251-7020
claudia.restrepo@nii.com

NON-GAAP RECONCILIATIONS
(Unaudited)

Net Debt

Net debt represents total debt less cash, cash equivalents, short-term and
long-term investments. We include the cash in long-term investments to the
items subtracted from total debt to calculate net debt. Net debt is not a
measurement under accounting principles generally accepted in the United
States, may not be similar to net debt measures of other companies and should
be considered in addition to, but not as a substitute for, the information
contained in our balance sheets. We believe that net debt and net debt to
consolidated operating income before depreciation and amortization provide
useful information concerning our liquidity and leverage. Our preliminary net
debt as of December 31, 2012 can be calculated as follows (in millions):

Total debt                      $  4,900.0
Add: debt discounts             25.0
Less: cash and cash equivalents 1,400.0
Less: short-term investments    200.0
Net debt                        $  3,325.0

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 non-cash asset
impairments and severance and contract termination costs associated with
publicly announced restructuring plans. During the fourth quarter of 2012, we
converted our consolidated OIBDA metric to a consolidated adjusted OIBDA
metric to better align this metric with our business objectives. 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. Our
preliminary consolidated OIBDA for the year ending December 31, 2012,
preliminary expected consolidated adjusted OIBDA range for the year ending
December 31, 2012 and adjusted OIBDA guidance range for the year ended
December 31, 2013 can be reconciled to our preliminary expected consolidated
statements of operations as follows (in millions):

                                               Preliminary    Adjusted OIBDA
                                                Adjusted OIBDA Guidance
                                    Prior OIBDA Range
                                    Guidance                   Range (1)
                                                Year Ending
                                    Year Ending 12/31/2012     Year Ending
                                    12/31/2012                 12/31/2013
Operating income (loss) (2)         $  150    $(125) – (105) $ (200) – (175)
Depreciation                        700         675            750 – 765
Amortization                        50          50             50 – 60
Operating income
beforedepreciation                 900         600 – 620      600 – 650
andamortization
Chile non-cash asset impairment    –           300            –
charge
Other non-cash asset impairment     23          23             –
charges
Restructuring charges               –           7              –
Adjusted operating income before    $  923    $ 930 – 950   $ 600 – 650
depreciation and amortization

(1) Does not take into account the impact of the potential impairment of
certain information systems that we have decided in 2013 to repurpose or no
longer use in certain of our operations, as well as other potential non-cash
charges that could be required in 2013.
(2) Includes the impact of non-cash equity compensation expense of
approximately $50 million for 2012 and approximately $40 million for 2013.

Operational Free Cash Flow

Consolidated operational free cash flow, represents consolidated adjusted
OIBDA less consolidated capital expenditures. Operational free cash flow is
not a measurement under accounting principles generally accepted in the United
States, may not be similar to operational free cash flow 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
operational free cash flow provides useful information to investors because it
represents the cash that we are able to generate after expanding and
maintaining our asset base. Operational free cash flow can be reconciled to
our estimated consolidated statements of operations as follows (in millions):

                                 Year Ending     Year Ending
                                 12/31/2012
                                                 12/31/2013
Consolidated adjusted operating

 income before depreciation and $ 930 – 950 $ 600 – 650 

 amortization
Less: consolidated capital
                                 1,500           1,000
 expenditures
Consolidated free cash flow      $(570) – (550)  $(400) – (350)

SOURCE NII Holdings, Inc.

Website: http://www.nii.com
 
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