NII Holdings Provides Updates On Its Accelerated Growth Plan And Business
Company modifies prepaid deactivation policy which contributes to higher than
expected subscriber losses in the fourth quarter for Nextel Mexico
RESTON, Va., Dec. 9, 2013
RESTON, Va., Dec. 9, 2013 /PRNewswire/ --NII Holdings, Inc. [NASDAQ: NIHD] a
provider of differentiated mobile communications services operating under the
Nextel brand inLatin America, today disclosed further details regarding the
Company's planned realignment in connection with its recently announced
Project Accelerate initiative.
In connection with Project Accelerate, the Company announced that it will
implement a restructuring and organizational realignment plan designed to
simplify the roles and responsibilities of its headquarters and market
organizations and better align its costs and organizational structure with its
growth strategy. The plan includes reductions of over 25% of the Company's
headquarters' staff and the elimination of over 1,400 positions in its market
operations. The realignment will result in a more streamlined management
structure that is expected to reduce costs and improve operational efficiency
while retaining the Company's focus on accelerating subscriber growth.
The Company expects to incur cash costs related to employee severance in the
range of $25 million to $35 million in connection with the plan, which include
$8.6 million in charges related to restructuring activities at the Company's
Mexico operating subsidiary that were accounted for in the Company's third
quarter 2013 results. Most of the remaining costs are expected to be accounted
for in the Company's results for the fourth quarter of 2013. The Company
expects to realize annualized cost savings of $50 million to $55 million as a
result of these actions.
Separately, the Company has modified its customer deactivation policy for
inactive prepaid subscribers. As a result, the Company expects a higher level
of prepaid subscriber deactivations in Mexico than previously estimated.
Taking this adjustment into account, the Company expects a net subscriber loss
of approximately 400,000 subscribers in Mexico for the fourth quarter 2013.
This policy change is not expected to have an impact on net subscriber
additions in Brazil or other markets.
"The structural changes we are announcing today support our accelerated growth
strategy," said Steve Shindler, NII Holdings chief executive officer."By
realigning our business and refocusing our teams on our growth goals, we can
further simplify and streamline operations, reduce costs and free up
Other Project Accelerate initiatives that are underway include the deployment
of aggressive marketing campaigns in the Company's core markets that target
growth on its new 3G networks, investments to expand the coverage and capacity
of its 3G networks in Mexico and Brazil, and expansion of its device portfolio
to include a wider range of smartphones and other handsets that better serve
the needs of its customers.
AboutNII Holdings, Inc.
NII Holdings, Inc., a publicly held company based inReston, Va., is a
provider of differentiated mobile communication services for businesses and
high value consumers inLatin America.NII, operating under the Nextel brand
inBrazil,Mexico,ArgentinaandChile, 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 is a Fortune 500 andBarron's500
company, and has also been named one of the best places to work among
multinationals inLatin Americaby theGreat Placeto Work^®Institute. The
company trades on the NASDAQ market under the symbol NIHD. Visit the company's
website at www.nii.com.
Nextel, theNextellogo and Nextel Direct Connect and International Direct
Connect are trademarks and/or service marks ofNextel Communications, Inc.,
and are used by NII's subsidiaries under license inLatin America.
VisitNII Holdings'news room for news and to access our markets' news center
Safe Harbor Statement
This news release contains "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Statements in this news
release regarding expectations, including forecasts regarding operating
results, performance assumptions and estimates relating to restructuring costs
and capital requirements, as well as other statements that are not historical
facts, are forward-looking statements.When used in this press release, these
forward-looking statements are generally identified by the words or phrases
"would be," "will allow," "expects to," "will continue," "is anticipated,"
"estimate," "project" or similar expressions. While the Company provides
forward-looking statements to assist in the understanding of its anticipated
future financial performance, the Company cautions readers not to place undue
reliance on any forward-looking statements, which speak only as of the date of
this report. Forward-looking statements are based on current expectations and
assumptions that are subject to significant risks and uncertainties that could
cause actual results to differ materially from those in the forward-looking
statements. Except as otherwise required by law, the Company undertakes no
obligation to publicly release any updates to forward-looking statements to
reflect events after the date of this report, including unforeseen events. We
have included risk factors and uncertainties that might cause differences
between anticipated and actual future results in the Company's Annual Report
on Form 10-K for the fiscal year ended December 31, 2012, as well as in other
reports filed from time to time with the Securities and Exchange Commission.
NII Holdings, Inc.
1875 Explorer Street, Suite 1000
Reston, VA 20190
Investor Relations:Tim Perrott
Media Relations:Claudia Restrepo
SOURCE NII Holdings, Inc.
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