Delaware | 1-04721 | 46-1170005 | ||
(State of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) |
6200 Sprint Parkway, Overland Park, Kansas | 66251 | |
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
SPRINT CORPORATION | ||||||||
Date: January 31, 2019 | /s/ Stefan K. Schnopp | |||||||
By: | Stefan K. Schnopp | |||||||
Corporate Secretary |
Number | Exhibit | ||
99.1 | Press Release Announcing Results for the Third Quarter Ended December 31, 2018 | ||
99.2 | Quarterly Investor Update |
News Release |
• | Wireless service revenue grew year-over-year for the second consecutive quarter, excluding the $199 million impact of the new revenue recognition standard |
◦ | Postpaid service revenue grew year-over-year for the first time in five years |
◦ | Prepaid service revenue grew year-over-year for the fifth consecutive quarter |
• | Net loss of $141 million, operating income of $479 million, and adjusted EBITDA* of $3.1 billion |
◦ | 12th consecutive quarter of operating income |
◦ | Highest fiscal third quarter adjusted EBITDA* in 12 years |
• | Postpaid net additions of 309,000 grew 53,000 year-over-year |
◦ | Sixth consecutive quarter of net additions |
◦ | 10th consecutive quarter of net additions in the business market |
• | Continued progress on Next-Gen Network plans |
◦ | Network investments of $1.4 billion more than doubled year-over-year |
◦ | Remain on track for mobile 5G launch in the coming months |
• | Strong progress on digitalization initiatives |
◦ | Postpaid gross additions in digital channels increased nearly 70 percent year-over-year |
◦ | Approximately 30 percent of all Sprint customer care chats are now performed by virtual agents using artificial intelligence |
• | Wireless service revenue grew year-over-year for the second consecutive quarter. |
• | Postpaid service revenue grew year-over-year for the first time in five years. |
• | Prepaid service revenue grew year-over-year for the fifth consecutive quarter. |
News Release |
• | Sprint completed thousands of tri-band upgrades and now has 2.5 GHz spectrum deployed on approximately 75 percent of its macro sites. |
• | Sprint added thousands of new outdoor small cells and currently has 27,000 deployed including both mini macros and strand mounts. |
• | Sprint has deployed hundreds of Massive MIMO radios, which increase the speed and capacity of the LTE network and, with a software upgrade, will provide mobile 5G service. |
• | Increasing digital revenue through improvement in gross adds and upgrades through digital channels. |
• | Providing intelligent customer experience by leveraging artificial intelligence, analytics, and automation. |
• | Improving digital engagement with the company’s in-house digital marketing agency and enhanced app functions. |
• | Postpaid gross additions in digital channels increased nearly 70 percent year-over-year. |
• | About one of every six postpaid upgrades occurred in a digital channel. |
• | Approximately 30 percent of all Sprint customer care chats are now performed by virtual agents using artificial intelligence. |
• | Introduced Apple Business Chat, allowing customers to chat directly with Sprint 24/7 by sending a message through the Messages app on an iPhone and iPad. |
• | The company continues to expect adjusted EBITDA* of $12.4 billion to $12.7 billion. |
• | Excluding the impact of the new revenue recognition standard, the company continues to expect adjusted EBITDA* of $11.7 billion to $12.0 billion. |
• | The company continues to expect cash capital expenditures excluding leased devices to be $5.0 billion to $5.5 billion. |
News Release |
• | Date/Time: 9:30 a.m. (ET) Thursday, January 31, 2019 |
• | Call-in Information |
◦ | U.S./Canada: 866-360-1063 (ID: 6879716) |
◦ | International: 443-961-0242 (ID: 6879716) |
• | Webcast available at www.sprint.com/investors |
• | Additional information about results is available on our Investor Relations website |
• | Media contact: Dave Tovar, David.Tovar@sprint.com |
• | Investor contact: Jud Henry, Investor.Relations@sprint.com |
News Release |
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Net additions (losses) (in thousands) | ||||||||||||||||
Postpaid | 309 | 109 | 256 | 541 | 385 | |||||||||||
Postpaid phone | (26 | ) | (34 | ) | 184 | 27 | 551 | |||||||||
Prepaid | (173 | ) | (14 | ) | 63 | (184 | ) | 193 | ||||||||
Wholesale and affiliate | (88 | ) | (115 | ) | 66 | (272 | ) | 246 | ||||||||
Total wireless net additions (losses) | 48 | (20 | ) | 385 | 85 | 824 | ||||||||||
End of period connections (in thousands) | ||||||||||||||||
Postpaid (a) (c) (d) | 32,605 | 32,296 | 31,942 | 32,605 | 31,942 | |||||||||||
Postpaid phone (a) (c) | 26,787 | 26,813 | 26,616 | 26,787 | 26,616 | |||||||||||
Prepaid (a) (b) (c) (e) (f) | 8,846 | 9,019 | 8,997 | 8,846 | 8,997 | |||||||||||
Wholesale and affiliate (b) (c) (g) | 13,044 | 13,232 | 13,642 | 13,044 | 13,642 | |||||||||||
Total end of period connections | 54,495 | 54,547 | 54,581 | 54,495 | 54,581 | |||||||||||
Churn | ||||||||||||||||
Postpaid | 1.85 | % | 1.78 | % | 1.80 | % | 1.75 | % | 1.73 | % | ||||||
Postpaid phone | 1.84 | % | 1.73 | % | 1.71 | % | 1.71 | % | 1.60 | % | ||||||
Prepaid | 4.83 | % | 4.74 | % | 4.63 | % | 4.58 | % | 4.68 | % | ||||||
Supplemental data - connected devices | ||||||||||||||||
End of period connections (in thousands) | ||||||||||||||||
Retail postpaid | 2,821 | 2,585 | 2,259 | 2,821 | 2,259 | |||||||||||
Wholesale and affiliate | 10,563 | 10,838 | 11,272 | 10,563 | 11,272 | |||||||||||
Total | 13,384 | 13,423 | 13,531 | 13,384 | 13,531 | |||||||||||
ARPU (h) | ||||||||||||||||
Postpaid | $ | 43.64 | $ | 43.99 | $ | 45.13 | $ | 43.73 | $ | 46.14 | ||||||
Postpaid phone | $ | 50.01 | $ | 50.16 | $ | 51.26 | $ | 49.91 | $ | 52.50 | ||||||
Prepaid | $ | 34.53 | $ | 35.40 | $ | 37.46 | $ | 35.40 | $ | 37.84 |
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
ABPA* | ||||||||||||||||
Postpaid service revenue | $ | 4,236 | $ | 4,255 | $ | 4,297 | $ | 12,679 | $ | 13,126 | ||||||
Add: Installment plan and non-operating lease billings | 306 | 326 | 379 | 984 | 1,144 | |||||||||||
Add: Equipment rentals | 1,313 | 1,253 | 1,047 | 3,778 | 2,912 | |||||||||||
Total for postpaid connections | $ | 5,855 | $ | 5,834 | $ | 5,723 | $ | 17,441 | $ | 17,182 | ||||||
Average postpaid accounts (in thousands) | 11,196 | 11,207 | 11,193 | 11,193 | 11,261 | |||||||||||
Postpaid ABPA* (i) | $ | 174.32 | $ | 173.53 | $ | 170.39 | $ | 173.14 | $ | 169.53 | ||||||
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Postpaid phone ABPU* | ||||||||||||||||
Postpaid phone service revenue | $ | 4,014 | $ | 4,038 | $ | 4,069 | $ | 12,029 | $ | 12,415 | ||||||
Add: Installment plan and non-operating lease billings | 253 | 279 | 335 | 839 | 1,025 | |||||||||||
Add: Equipment rentals | 1,307 | 1,247 | 1,037 | 3,758 | 2,877 | |||||||||||
Total for postpaid phone connections | $ | 5,574 | $ | 5,564 | $ | 5,441 | $ | 16,626 | $ | 16,317 | ||||||
Postpaid average phone connections (in thousands) | 26,751 | 26,838 | 26,461 | 26,778 | 26,275 | |||||||||||
Postpaid phone ABPU* (j) | $ | 69.45 | $ | 69.10 | $ | 68.54 | $ | 68.98 | $ | 69.00 |
News Release |
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Postpaid activations (in thousands) | 4,462 | 3,772 | 4,874 | 11,707 | 12,459 | |||||||||||
Postpaid activations financed | 81 | % | 81 | % | 84 | % | 82 | % | 85 | % | ||||||
Postpaid activations - operating leases | 63 | % | 59 | % | 72 | % | 64 | % | 66 | % | ||||||
Installment plans | ||||||||||||||||
Installment sales financed | $ | 357 | $ | 255 | $ | 276 | $ | 825 | $ | 1,097 | ||||||
Installment billings | $ | 251 | $ | 292 | $ | 353 | $ | 868 | $ | 1,094 | ||||||
Installment receivables, net | $ | 894 | $ | 838 | $ | 1,383 | $ | 894 | $ | 1,383 | ||||||
Equipment rentals and depreciation - equipment rentals | ||||||||||||||||
Equipment rentals | $ | 1,313 | $ | 1,253 | $ | 1,047 | $ | 3,778 | $ | 2,912 | ||||||
Depreciation - equipment rentals | $ | 1,137 | $ | 1,181 | $ | 990 | $ | 3,454 | $ | 2,732 | ||||||
Leased device additions | ||||||||||||||||
Cash paid for capital expenditures - leased devices | $ | 2,215 | $ | 1,707 | $ | 2,468 | $ | 5,739 | $ | 5,533 | ||||||
Leased devices | ||||||||||||||||
Leased devices in property, plant and equipment, net | $ | 6,683 | $ | 6,184 | $ | 5,683 | $ | 6,683 | $ | 5,683 | ||||||
Leased device units | ||||||||||||||||
Leased devices in property, plant and equipment (units in thousands) | 15,897 | 15,392 | 14,002 | 15,897 | 14,002 | |||||||||||
Leased device and receivables financings net proceeds | ||||||||||||||||
Proceeds | $ | 2,200 | $ | 1,527 | $ | 1,125 | $ | 5,083 | $ | 2,679 | ||||||
Repayments | (1,900 | ) | (1,200 | ) | (598 | ) | (4,170 | ) | (2,019 | ) | ||||||
Net proceeds of financings related to devices and receivables | $ | 300 | $ | 327 | $ | 527 | $ | 913 | $ | 660 |
News Release |
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Net operating revenues | ||||||||||||||||
Service revenue | $ | 5,699 | $ | 5,762 | $ | 5,930 | $ | 17,201 | $ | 17,968 | ||||||
Equipment sales | 1,589 | 1,418 | 1,262 | 4,180 | 3,443 | |||||||||||
Equipment rentals | 1,313 | 1,253 | 1,047 | 3,778 | 2,912 | |||||||||||
Total net operating revenues | 8,601 | 8,433 | 8,239 | 25,159 | 24,323 | |||||||||||
Net operating expenses | ||||||||||||||||
Cost of services (exclusive of depreciation and amortization below) | 1,648 | 1,694 | 1,733 | 5,019 | 5,140 | |||||||||||
Cost of equipment sales | 1,734 | 1,517 | 1,673 | 4,521 | 4,622 | |||||||||||
Cost of equipment rentals (exclusive of depreciation below) | 182 | 151 | 123 | 457 | 347 | |||||||||||
Selling, general and administrative | 2,003 | 1,861 | 2,108 | 5,731 | 6,059 | |||||||||||
Depreciation - network and other | 1,088 | 1,021 | 987 | 3,132 | 2,961 | |||||||||||
Depreciation - equipment rentals | 1,137 | 1,181 | 990 | 3,454 | 2,732 | |||||||||||
Amortization | 145 | 159 | 196 | 475 | 628 | |||||||||||
Other, net | 185 | 71 | (298 | ) | 298 | (657 | ) | |||||||||
Total net operating expenses | 8,122 | 7,655 | 7,512 | 23,087 | 21,832 | |||||||||||
Operating income | 479 | 778 | 727 | 2,072 | 2,491 | |||||||||||
Interest expense | (664 | ) | (633 | ) | (581 | ) | (1,934 | ) | (1,789 | ) | ||||||
Other income (expense), net | 32 | 79 | (42 | ) | 153 | (50 | ) | |||||||||
(Loss) income before income taxes | (153 | ) | 224 | 104 | 291 | 652 | ||||||||||
Income tax benefit (expense) | 8 | (17 | ) | 7,052 | (56 | ) | 6,662 | |||||||||
Net (loss) income | (145 | ) | 207 | 7,156 | 235 | 7,314 | ||||||||||
Less: Net loss (income) attributable to noncontrolling interests | 4 | (11 | ) | 6 | (4 | ) | 6 | |||||||||
Net (loss) income attributable to Sprint Corporation | $ | (141 | ) | $ | 196 | $ | 7,162 | $ | 231 | $ | 7,320 | |||||
Basic net (loss) income per common share attributable to Sprint Corporation | $ | (0.03 | ) | $ | 0.05 | $ | 1.79 | $ | 0.06 | $ | 1.83 | |||||
Diluted net (loss) income per common share attributable to Sprint Corporation | $ | (0.03 | ) | $ | 0.05 | $ | 1.76 | $ | 0.06 | $ | 1.79 | |||||
Basic weighted average common shares outstanding | 4,078 | 4,061 | 4,001 | 4,050 | 3,998 | |||||||||||
Diluted weighted average common shares outstanding | 4,078 | 4,124 | 4,061 | 4,110 | 4,080 | |||||||||||
Effective tax rate | 5.2 | % | 7.6 | % | -6,780.8 | % | 19.2 | % | -1,021.8 | % |
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Net (loss) income | $ | (145 | ) | $ | 207 | $ | 7,156 | $ | 235 | $ | 7,314 | |||||
Income tax (benefit) expense | (8 | ) | 17 | (7,052 | ) | 56 | (6,662 | ) | ||||||||
(Loss) income before income taxes | (153 | ) | 224 | 104 | 291 | 652 | ||||||||||
Other (income) expense, net | (32 | ) | (79 | ) | 42 | (153 | ) | 50 | ||||||||
Interest expense | 664 | 633 | 581 | 1,934 | 1,789 | |||||||||||
Operating income | 479 | 778 | 727 | 2,072 | 2,491 | |||||||||||
Depreciation - network and other | 1,088 | 1,021 | 987 | 3,132 | 2,961 | |||||||||||
Depreciation - equipment rentals | 1,137 | 1,181 | 990 | 3,454 | 2,732 | |||||||||||
Amortization | 145 | 159 | 196 | 475 | 628 | |||||||||||
EBITDA* (1) | 2,849 | 3,139 | 2,900 | 9,133 | 8,812 | |||||||||||
Loss (gain) from asset dispositions, exchanges, and other, net (2) | 105 | 68 | — | 173 | (304 | ) | ||||||||||
Severance and exit costs (3) | 30 | 25 | 13 | 63 | 13 | |||||||||||
Contract terminations costs (benefits) (4) | — | — | — | 34 | (5 | ) | ||||||||||
Merger costs (5) | 67 | 56 | — | 216 | — | |||||||||||
Litigation expenses and other contingencies (6) | 50 | — | (260 | ) | 50 | (315 | ) | |||||||||
Hurricanes (7) | — | (32 | ) | 66 | (32 | ) | 100 | |||||||||
Adjusted EBITDA* (1) | $ | 3,101 | $ | 3,256 | $ | 2,719 | $ | 9,637 | $ | 8,301 | ||||||
Adjusted EBITDA margin* | 54.4 | % | 56.5 | % | 45.9 | % | 56.0 | % | 46.2 | % | ||||||
Selected items: | ||||||||||||||||
Cash paid for capital expenditures - network and other | $ | 1,416 | $ | 1,266 | $ | 696 | $ | 3,814 | $ | 2,539 | ||||||
Cash paid for capital expenditures - leased devices | $ | 2,215 | $ | 1,707 | $ | 2,468 | $ | 5,739 | $ | 5,533 |
News Release |
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Net operating revenues | ||||||||||||||||
Service revenue | ||||||||||||||||
Postpaid | $ | 4,236 | $ | 4,255 | $ | 4,297 | $ | 12,679 | $ | 13,126 | ||||||
Prepaid | 924 | 954 | 993 | 2,860 | 2,982 | |||||||||||
Wholesale, affiliate and other | 289 | 289 | 329 | 868 | 884 | |||||||||||
Total service revenue | 5,449 | 5,498 | 5,619 | 16,407 | 16,992 | |||||||||||
Equipment sales | 1,589 | 1,418 | 1,262 | 4,180 | 3,443 | |||||||||||
Equipment rentals | 1,313 | 1,253 | 1,047 | 3,778 | 2,912 | |||||||||||
Total net operating revenues | 8,351 | 8,169 | 7,928 | 24,365 | 23,347 | |||||||||||
Net operating expenses | ||||||||||||||||
Cost of services (exclusive of depreciation and amortization below) | 1,439 | 1,466 | 1,466 | 4,334 | 4,300 | |||||||||||
Cost of equipment sales | 1,734 | 1,517 | 1,673 | 4,521 | 4,622 | |||||||||||
Cost of equipment rentals (exclusive of depreciation below) | 182 | 151 | 123 | 457 | 347 | |||||||||||
Selling, general and administrative | 1,885 | 1,749 | 2,024 | 5,338 | 5,835 | |||||||||||
Depreciation - network and other | 1,035 | 968 | 931 | 2,975 | 2,800 | |||||||||||
Depreciation - equipment rentals | 1,137 | 1,181 | 990 | 3,454 | 2,732 | |||||||||||
Amortization | 145 | 159 | 196 | 475 | 628 | |||||||||||
Other, net | 185 | 58 | 16 | 280 | (293 | ) | ||||||||||
Total net operating expenses | 7,742 | 7,249 | 7,419 | 21,834 | 20,971 | |||||||||||
Operating income | $ | 609 | $ | 920 | $ | 509 | $ | 2,531 | $ | 2,376 | ||||||
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Operating income | $ | 609 | $ | 920 | $ | 509 | $ | 2,531 | $ | 2,376 | ||||||
Loss (gain) from asset dispositions, exchanges, and other, net (2) | 105 | 68 | — | 173 | (304 | ) | ||||||||||
Severance and exit costs (3) | 30 | 12 | 4 | 45 | (1 | ) | ||||||||||
Contract terminations costs (benefits) (4) | — | — | — | 34 | (5 | ) | ||||||||||
Litigation expenses and other contingencies (6) | 50 | — | 63 | 50 | 63 | |||||||||||
Hurricanes (7) | — | (32 | ) | 66 | (32 | ) | 100 | |||||||||
Depreciation - network and other | 1,035 | 968 | 931 | 2,975 | 2,800 | |||||||||||
Depreciation - equipment rentals | 1,137 | 1,181 | 990 | 3,454 | 2,732 | |||||||||||
Amortization | 145 | 159 | 196 | 475 | 628 | |||||||||||
Adjusted EBITDA* (1) | $ | 3,111 | $ | 3,276 | $ | 2,759 | $ | 9,705 | $ | 8,389 | ||||||
Adjusted EBITDA margin* | 57.1 | % | 59.6 | % | 49.1 | % | 59.2 | % | 49.4 | % | ||||||
Selected items: | ||||||||||||||||
Cash paid for capital expenditures - network and other | $ | 1,242 | $ | 1,101 | $ | 565 | $ | 3,362 | $ | 2,079 | ||||||
Cash paid for capital expenditures - leased devices | $ | 2,215 | $ | 1,707 | $ | 2,468 | $ | 5,739 | $ | 5,533 |
News Release |
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Net operating revenues | $ | 316 | $ | 328 | $ | 393 | $ | 982 | $ | 1,235 | ||||||
Net operating expenses | ||||||||||||||||
Cost of services (exclusive of depreciation and amortization below) | 280 | 295 | 352 | 886 | 1,111 | |||||||||||
Selling, general and administrative | 52 | 53 | 71 | 174 | 194 | |||||||||||
Depreciation and amortization | 51 | 51 | 55 | 151 | 155 | |||||||||||
Other, net | — | 13 | (314 | ) | 18 | (309 | ) | |||||||||
Total net operating expenses | 383 | 412 | 164 | 1,229 | 1,151 | |||||||||||
Operating (loss) income | $ | (67 | ) | $ | (84 | ) | $ | 229 | $ | (247 | ) | $ | 84 |
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Operating (loss) income | $ | (67 | ) | $ | (84 | ) | $ | 229 | $ | (247 | ) | $ | 84 | |||
Severance and exit costs (3) | — | 13 | 9 | 18 | 14 | |||||||||||
Litigation expenses and other contingencies (6) | — | — | (323 | ) | — | (323 | ) | |||||||||
Depreciation and amortization | 51 | 51 | 55 | 151 | 155 | |||||||||||
Adjusted EBITDA* | $ | (16 | ) | $ | (20 | ) | $ | (30 | ) | $ | (78 | ) | $ | (70 | ) | |
Adjusted EBITDA margin* | -5.1 | % | -6.1 | % | -7.6 | % | -7.9 | % | -5.7 | % | ||||||
Selected items: | ||||||||||||||||
Cash paid for capital expenditures - network and other | $ | 64 | $ | 55 | $ | 30 | $ | 170 | $ | 132 |
News Release |
Year To Date | ||||||
12/31/18 | 12/31/17 | |||||
Operating activities | ||||||
Net income | $ | 235 | $ | 7,314 | ||
Depreciation and amortization | 7,061 | 6,321 | ||||
Provision for losses on accounts receivable | 278 | 312 | ||||
Share-based and long-term incentive compensation expense | 101 | 137 | ||||
Deferred income tax expense (benefit) | 25 | (6,707 | ) | |||
Gains from asset dispositions and exchanges | — | (479 | ) | |||
Loss on early extinguishment of debt | — | 65 | ||||
Amortization of long-term debt premiums, net | (94 | ) | (125 | ) | ||
Loss on disposal of property, plant and equipment | 642 | 533 | ||||
Deferred purchase price from sale of receivables | (223 | ) | (909 | ) | ||
Other changes in assets and liabilities: | ||||||
Accounts and notes receivable | 65 | (74 | ) | |||
Inventories and other current assets | 248 | 570 | ||||
Accounts payable and other current liabilities | (530 | ) | (104 | ) | ||
Non-current assets and liabilities, net | (601 | ) | 260 | |||
Other, net | 375 | 295 | ||||
Net cash provided by operating activities | 7,582 | 7,409 | ||||
Investing activities | ||||||
Capital expenditures - network and other | (3,814 | ) | (2,539 | ) | ||
Capital expenditures - leased devices | (5,739 | ) | (5,533 | ) | ||
Expenditures relating to FCC licenses | (145 | ) | (92 | ) | ||
Change in short-term investments, net | 1,467 | 5,271 | ||||
Proceeds from sales of assets and FCC licenses | 416 | 367 | ||||
Proceeds from deferred purchase price from sale of receivables | 223 | 909 | ||||
Proceeds from corporate owned life insurance policies | 110 | 2 | ||||
Other, net | 52 | (1 | ) | |||
Net cash used in investing activities | (7,430 | ) | (1,616 | ) | ||
Financing activities | ||||||
Proceeds from debt and financings | 6,416 | 3,073 | ||||
Repayments of debt, financing and capital lease obligations | (6,937 | ) | (7,159 | ) | ||
Debt financing costs | (286 | ) | (19 | ) | ||
Call premiums paid on debt redemptions | — | (129 | ) | |||
Proceeds from issuance of common stock, net | 281 | 12 | ||||
Other, net | — | (18 | ) | |||
Net cash used in financing activities | (526 | ) | (4,240 | ) | ||
Net (decrease) increase in cash, cash equivalents and restricted cash | (374 | ) | 1,553 | |||
Cash, cash equivalents and restricted cash, beginning of period | 6,659 | 2,942 | ||||
Cash, cash equivalents and restricted cash, end of period | $ | 6,285 | $ | 4,495 |
Quarter To Date | Year To Date | |||||||||||||||
12/31/18 | 9/30/18 | 12/31/17 | 12/31/18 | 12/31/17 | ||||||||||||
Net cash provided by operating activities | $ | 2,225 | $ | 2,927 | $ | 2,683 | $ | 7,582 | $ | 7,409 | ||||||
Capital expenditures - network and other | (1,416 | ) | (1,266 | ) | (696 | ) | (3,814 | ) | (2,539 | ) | ||||||
Capital expenditures - leased devices | (2,215 | ) | (1,707 | ) | (2,468 | ) | (5,739 | ) | (5,533 | ) | ||||||
Expenditures relating to FCC licenses, net | (75 | ) | (11 | ) | (73 | ) | (145 | ) | (92 | ) | ||||||
Proceeds from sales of assets and FCC licenses | 144 | 139 | 149 | 416 | 367 | |||||||||||
Proceeds from deferred purchase price from sale of receivables | — | 53 | 269 | 223 | 909 | |||||||||||
Other investing activities, net | 129 | 63 | 6 | 189 | 4 | |||||||||||
Free cash flow* | $ | (1,208 | ) | $ | 198 | $ | (130 | ) | $ | (1,288 | ) | $ | 525 | |||
Net proceeds of financings related to devices and receivables | 300 | 327 | 527 | 913 | 660 | |||||||||||
Adjusted free cash flow* | $ | (908 | ) | $ | 525 | $ | 397 | $ | (375 | ) | $ | 1,185 |
News Release |
12/31/18 | 3/31/18 | |||||
ASSETS | ||||||
Current assets | ||||||
Cash and cash equivalents | $ | 6,191 | $ | 6,610 | ||
Short-term investments | 632 | 2,354 | ||||
Accounts and notes receivable, net | 3,455 | 3,711 | ||||
Device and accessory inventory | 919 | 1,003 | ||||
Prepaid expenses and other current assets | 1,199 | 575 | ||||
Total current assets | 12,396 | 14,253 | ||||
Property, plant and equipment, net | 21,422 | 19,925 | ||||
Costs to acquire a customer contract | 1,497 | — | ||||
Goodwill | 6,598 | 6,586 | ||||
FCC licenses and other | 41,448 | 41,309 | ||||
Definite-lived intangible assets, net | 1,915 | 2,465 | ||||
Other assets | 1,128 | 921 | ||||
Total assets | $ | 86,404 | $ | 85,459 | ||
LIABILITIES AND EQUITY | ||||||
Current liabilities | ||||||
Accounts payable | $ | 3,637 | $ | 3,409 | ||
Accrued expenses and other current liabilities | 3,467 | 3,962 | ||||
Current portion of long-term debt, financing and capital lease obligations | 3,596 | 3,429 | ||||
Total current liabilities | 10,700 | 10,800 | ||||
Long-term debt, financing and capital lease obligations | 36,288 | 37,463 | ||||
Deferred tax liabilities | 7,684 | 7,294 | ||||
Other liabilities | 3,403 | 3,483 | ||||
Total liabilities | 58,075 | 59,040 | ||||
Stockholders' equity | ||||||
Common stock | 41 | 40 | ||||
Treasury shares, at cost | (7 | ) | — | |||
Paid-in capital | 28,278 | 27,884 | ||||
Retained earnings (accumulated deficit) | 291 | (1,255 | ) | |||
Accumulated other comprehensive loss | (333 | ) | (313 | ) | ||
Total stockholders' equity | 28,270 | 26,356 | ||||
Noncontrolling interests | 59 | 63 | ||||
Total equity | 28,329 | 26,419 | ||||
Total liabilities and equity | $ | 86,404 | $ | 85,459 |
12/31/18 | 3/31/18 | |||||
Total debt | $ | 39,884 | $ | 40,892 | ||
Less: Cash and cash equivalents | (6,191 | ) | (6,610 | ) | ||
Less: Short-term investments | (632 | ) | (2,354 | ) | ||
Net debt* | $ | 33,061 | $ | 31,928 |
News Release |
12/31/18 | ||||
ISSUER | MATURITY | PRINCIPAL | ||
Sprint Corporation | ||||
7.25% Senior notes due 2021 | 09/15/2021 | $ | 2,250 | |
7.875% Senior notes due 2023 | 09/15/2023 | 4,250 | ||
7.125% Senior notes due 2024 | 06/15/2024 | 2,500 | ||
7.625% Senior notes due 2025 | 02/15/2025 | 1,500 | ||
7.625% Senior notes due 2026 | 03/01/2026 | 1,500 | ||
Sprint Corporation | 12,000 | |||
Sprint Spectrum Co LLC, Sprint Spectrum Co II LLC, and Sprint Spectrum Co III LLC | ||||
3.36% Senior secured notes due 2021 | 09/20/2021 | 2,406 | ||
4.738% Senior secured notes due 2025 | 03/20/2025 | 2,100 | ||
5.152% Senior secured notes due 2028 | 03/20/2028 | 1,838 | ||
Sprint Spectrum Co LLC, Sprint Spectrum Co II LLC, and Sprint Spectrum Co III LLC | 6,344 | |||
Sprint Communications, Inc. | ||||
Export Development Canada secured loan | 12/17/2019 | 300 | ||
7% Guaranteed notes due 2020 | 03/01/2020 | 1,000 | ||
7% Senior notes due 2020 | 08/15/2020 | 1,500 | ||
11.5% Senior notes due 2021 | 11/15/2021 | 1,000 | ||
6% Senior notes due 2022 | 11/15/2022 | 2,280 | ||
Sprint Communications, Inc. | 6,080 | |||
Sprint Capital Corporation | ||||
6.9% Senior notes due 2019 | 05/01/2019 | 1,729 | ||
6.875% Senior notes due 2028 | 11/15/2028 | 2,475 | ||
8.75% Senior notes due 2032 | 03/15/2032 | 2,000 | ||
Sprint Capital Corporation | 6,204 | |||
Credit facilities | ||||
PRWireless secured term loan | 06/28/2020 | 187 | ||
Secured equipment credit facilities | 2020 - 2022 | 515 | ||
Secured term loan | 02/03/2024 | 3,930 | ||
Secured term loan B1 | 02/03/2024 | 1,100 | ||
Credit facilities | 5,732 | |||
Accounts receivable facility | 2020 | 3,324 | ||
Financing obligations | 2021 | 118 | ||
Capital leases and other obligations | 2019 - 2026 | 470 | ||
Total principal | 40,272 | |||
Net premiums and debt financing costs | (388 | ) | ||
Total debt | $ | 39,884 |
News Release |
Three Months Ended December 31, 2018 | Nine Months Ended December 31, 2018 | ||||||||||||||||||
As reported | Balances without adoption of Topic 606 | Change | As reported | Balances without adoption of Topic 606 | Change | ||||||||||||||
Net operating revenues | |||||||||||||||||||
Service revenue | $ | 5,699 | $ | 5,898 | $ | (199 | ) | $ | 17,201 | $ | 17,716 | $ | (515 | ) | |||||
Equipment sales | 1,589 | 1,264 | 325 | 4,180 | 3,223 | 957 | |||||||||||||
Equipment rentals | 1,313 | 1,329 | (16 | ) | 3,778 | 3,827 | (49 | ) | |||||||||||
Total net operating revenues | 8,601 | 8,491 | 110 | 25,159 | 24,766 | 393 | |||||||||||||
Net operating expenses | |||||||||||||||||||
Cost of services (exclusive of depreciation and amortization below) | 1,648 | 1,671 | (23 | ) | 5,019 | 5,073 | (54 | ) | |||||||||||
Cost of equipment sales | 1,734 | 1,715 | 19 | 4,521 | 4,431 | 90 | |||||||||||||
Cost of equipment rentals (exclusive of depreciation below) | 182 | 182 | — | 457 | 457 | — | |||||||||||||
Selling, general and administrative | 2,003 | 2,145 | (142 | ) | 5,731 | 6,047 | (316 | ) | |||||||||||
Depreciation - network and other | 1,088 | 1,088 | — | 3,132 | 3,132 | — | |||||||||||||
Depreciation - equipment rentals | 1,137 | 1,137 | — | 3,454 | 3,454 | — | |||||||||||||
Amortization | 145 | 145 | — | 475 | 475 | — | |||||||||||||
Other, net | 185 | 185 | — | 298 | 298 | — | |||||||||||||
Total net operating expenses | 8,122 | 8,268 | (146 | ) | 23,087 | 23,367 | (280 | ) | |||||||||||
Operating income | 479 | 223 | 256 | 2,072 | 1,399 | 673 | |||||||||||||
Total other expense | (632 | ) | (632 | ) | — | (1,781 | ) | (1,781 | ) | — | |||||||||
(Loss) income before income taxes | (153 | ) | (409 | ) | 256 | 291 | (382 | ) | 673 | ||||||||||
Income tax benefit (expense) | 8 | 62 | (54 | ) | (56 | ) | 85 | (141 | ) | ||||||||||
Net (loss) income | (145 | ) | (347 | ) | 202 | 235 | (297 | ) | 532 | ||||||||||
Less: Net loss (income) attributable to noncontrolling interests | 4 | 4 | — | (4 | ) | (4 | ) | — | |||||||||||
Net (loss) income attributable to Sprint Corporation | $ | (141 | ) | $ | (343 | ) | $ | 202 | $ | 231 | $ | (301 | ) | $ | 532 | ||||
Basic net (loss) income per common share attributable to Sprint Corporation | $ | (0.03 | ) | $ | (0.08 | ) | $ | 0.05 | $ | 0.06 | $ | (0.07 | ) | $ | 0.13 | ||||
Diluted net (loss) income per common share attributable to Sprint Corporation | $ | (0.03 | ) | $ | (0.08 | ) | $ | 0.05 | $ | 0.06 | $ | (0.07 | ) | $ | 0.13 | ||||
Basic weighted average common shares outstanding | 4,078 | 4,078 | — | 4,050 | 4,050 | — | |||||||||||||
Diluted weighted average common shares outstanding | 4,078 | 4,078 | — | 4,110 | 4,050 | 60 |
News Release |
December 31, 2018 | |||||||||
As reported | Balances without adoption of Topic 606 | Change | |||||||
ASSETS | |||||||||
Current assets | |||||||||
Accounts and notes receivable, net | $ | 3,455 | $ | 3,356 | $ | 99 | |||
Device and accessory inventory | 919 | 941 | (22 | ) | |||||
Prepaid expenses and other current assets | 1,199 | 672 | 527 | ||||||
Costs to acquire a customer contract | 1,497 | — | 1,497 | ||||||
Other assets | 1,128 | 939 | 189 | ||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||
Current liabilities | |||||||||
Accrued expenses and other current liabilities | $ | 3,467 | $ | 3,489 | $ | (22 | ) | ||
Deferred tax liabilities | 7,684 | 7,177 | 507 | ||||||
Other liabilities | 3,403 | 3,437 | (34 | ) | |||||
Stockholders' equity | |||||||||
Retained earnings (accumulated deficit) | 291 | (1,548 | ) | 1,839 |
News Release |
(1) | As more of our customers elect to lease a device rather than purchasing one under our subsidized program, there is a significant positive impact to EBITDA* and Adjusted EBITDA* from direct channel sales primarily due to the fact the cost of the device is not recorded as cost of equipment sales but rather is depreciated over the customer lease term. Under our device leasing program for the direct channel, devices are transferred from inventory to property and equipment and the cost of the leased device is recognized as depreciation expense over the customer lease term to an estimated residual value. The customer payments are recognized as revenue over the term of the lease. Under our subsidized program, the cash received from the customer for the device is recognized as revenue from equipment sales at the point of sale and the cost of the device is recognized as cost of equipment sales. During the three and nine month periods ended December 31, 2018, we leased devices through our Sprint direct channels totaling approximately $1,560 million and $3,817 million, respectively, which would have increased cost of equipment sales and reduced EBITDA* if they had been purchased under our subsidized program. |
(2) | During the third and second quarters of fiscal year 2018 and the first quarter of fiscal year 2017, the company recorded losses on dispositions of assets primarily related to cell site construction and network development costs that are no longer relevant as a result of changes in the company's network plans. Additionally, during the first quarter of fiscal year 2017 the company recorded a pre-tax non-cash gain related to spectrum swaps with other carriers. |
(3) | During the third, second and first quarters of fiscal year 2018 and the third quarter of fiscal year 2017, severance and exit costs consist of lease exit costs primarily associated with tower and cell sites, access exit costs related to payments that will continue to be made under the company's backhaul access contracts for which the company will no longer be receiving any economic benefit, and severance costs associated with reduction in its work force. |
(4) | During the first quarter of fiscal year 2018, contract termination costs are primarily due to the purchase of certain leased spectrum assets, which upon termination of the spectrum leases resulted in the accelerated recognition of the unamortized favorable lease balances. During the first quarter of fiscal year 2017, we recorded a $5 million gain due to reversal of a liability recorded in relation to the termination of our relationship with General Wireless Operations, Inc. (Radio Shack). |
(5) | During the third, second and first quarters of fiscal year 2018, we recorded merger costs of $67 million, $56 million and $93 million, respectively, due to the proposed Business Combination Agreement with T-Mobile. |
(6) | During the third quarter of fiscal year 2018, litigation expenses and other contingencies consist of tax matters settled with the State of New York. During the third and first quarters of fiscal year 2017, litigation expenses and other contingencies consist of reductions associated with legal settlements or favorable developments in pending legal proceedings as well as non-recurring charges of $51 million related to a regulatory fee matter. |
(7) | During the second quarter of fiscal year 2018 we recognized hurricane-related reimbursements of $32 million. During the third and second quarters of fiscal year 2017 we recorded estimated hurricane-related charges of $66 million and $34 million, respectively, consisting of customer service credits, incremental roaming costs, network repairs and replacements. |
News Release |
News Release |
'0@+TEM86=E0B O26UA9V5#("]);6%G94E=#0H^/@T*+U!A
M ^0%Y@+!5YKR.OK.>3&F,"I:UK)9?UP#@FP=WLQ/DLW-E2F-4L*Q)
M4B4!Q 3>BEA22Y' XAA,GQ*81XP-;M6HE;\W]
M^O7+R 3ZM6M2S"0
M K1PX?%E\?1?97[N[N^<^?,Z_R.N7DB1,4S\)')B8FV[9M8SXZF8/W#P(
M@(%9LWIUHT8CLCZ*[*_T;G,&;L9^_/%'BF?AHW%N;@;_-IQ/4EM3LWW[=BDF
M$P @)6I4Z<6OGPILD2*[*_T;KF11#<'V[5KMW__?N:CDSFE)26^DJUD P
M8&+@P($WL[)$EDB1_97>; ]>N>^Z^.VI'"P"@6LB9,J4\>>"KW;M_\YO?1+IR67)[_KGG@B>9
M>*O#A843)TYLUJQ9C"84 CK3W_Z4WDVG"]^]]W6K5M'NG*7+EW6K5T;/,S$
M57U[]NR,Z=,;-VX.M#OX,S8.C&2$:68X(YG/0X4P1[;N>"
M:"=N+<>N%GK?>+:=@6U29*W;V=+*K'5A7>)EI=FQ(9H]G,Z.,>G'$/8QCNS[
MQ\:DX](_!'OG'6/N'&V,2>?_4$S\2R6&F:$P+ 0=0]^-@6%DF!AFAO(&'#7J
MB^L!IB/WG@T*96YD
%'DET B
M>OMW$0 ^*;R8G2 R-2S26[91)UK[=Q4 /KGY3W:"]!:O874_S"QIWJ4^7@:
M/UY@OVU[M(EP25=P5GYX2WV?=8"P3&9'];?B-:S/V26=N,/'JP#P1^EE[+ 6
MKV$]PQEOG(\:%L2?MJR1;\O:*3QT<<-&=GZ@A@7Q:!#[__N?BPY=%. MC((:
M%L0CSIJC]XN6,YB3']9W2AN, (2JUCIF5 O7L.[040(_J[.FUWMW%_XCF?%V'XJVT8UPT@X-'#SF!=5LOU@7)?
M^)L=!WJA60ZQJLU69[0..\?U@1:,==P-V#L TW0A9C5>ZXC6PSWKI7@X (#EN;N[IZ:F
M&A'+J,([=^)^^JE%BQ:Z%P4 &!M+[WTTNFTM)*(55(']N]OWZX=#PT! !,
M:]Z\^;6
'AS N]P#1J- $!
M 71GW@@W%/V8A(0$NI,) "@*$N6+*D6L8,Z<7^E7YLSW+YU:]"@012GW3@W
M%&U.86'AM&G3*$XF " THP?-^[)X\?$M9*XO]*OAP>/Q\71G?:9,V8P'Q2K
M)"
MJL8KFQ4??&P% !TB5Q\
MQ;4B6N\,]NO;-R,]G7D-%3XB*LV52J4*WK2)^7 0_F@:&A(3$ZVMK<6?<0
M@(_$++[*>?APQ(@1_#_?Q,3D:$0$\S(J,+$Q,52:*SL[N^CH:.;#0?CSJJ)B
M[MRYXD\W # )\0LOEJ_?KW6G^_GY]=07\^\D@H)K>:J1X\>R4E)S(>#\ 0?
M6P$ @'3$++X2_U*I5*])=!@\>_-7NW<$#3#Q7;FYNU/>! $ FP
M *)IV:+%VPL7?GOV;/! ]5UM6+_^U[_^M98+ $!U=/?0H7'UVNJ=18NZ=NT:
M>E0 "HB+2WME5=>B9/&H2=/G'CUU5<[=>H4>E0 "KHEEMNV?/55\%C55D5
M'CJ4DY.CY0( 4'W%SVNK_/S\WS_T4/W4U-!# @!0<;?>>FL\O+9:_]EG_?OW
MMWT= *C6TM+27GWUU>"OK1:^]5:O7KV<& @ 5'>WWGIK_IX] 6/5B>/'9\Z<
MF9Z>'GHD N5%)24DY.SO%CQT(EJT,%!3E3IEQRR26A1P( H!+T[MU[P_KU
MH9)57E[>\.'#G6L# "2&I*2D9YYY)LAKJ[.EI;F??'+333?9O@X )(P^O7MO
MW+"AZI/5L>+B-^?-Z]*E2^@! "H-*%>6QTJ*'AZ\N3FS9N''@ @,H4Y+55
M7E[> P\\H$