Delaware (State or other jurisdiction of incorporation) | 000-32421 (Commission File Number) | 91-1671412 (IRS Employer Identification No.) | |
1875 Explorer Street, Suite 1000 Reston, Virginia (Address of principal executive offices) | 20190 (Zip Code) |
Exhibit No. | Description | |
99.1 | Unaudited Pro Forma Financial Information. |
NII HOLDINGS, INC. | ||
(Registrant) | ||
Dated: August 20, 2014 | By: /s/ SHANA C. SMITH | |
Shana C. Smith | ||
Vice President, Deputy General Counsel |
Exhibit No. | Description | |
99.1 | Unaudited Pro Forma Financial Information. |
Historical | Pro Forma Adjustments for Activity of Business and Net Assets Disposed | Unaudited Pro Forma | |||||||||
ASSETS | |||||||||||
Current assets | |||||||||||
Cash and cash equivalents | $ | 814,023 | $ | (10,210 | ) | (a) | $ | 803,813 | |||
Short-term investments | 132,590 | — | 132,590 | ||||||||
Accounts receivable, less allowance for doubtful accounts of $66,200 | 485,185 | (10,712 | ) | (b) | 474,473 | ||||||
Handset and accessory inventory | 373,565 | — | 373,565 | ||||||||
Deferred income taxes, net | 98,671 | — | 98,671 | ||||||||
Prepaid expenses and other | 668,943 | (8,240 | ) | (b) | 660,703 | ||||||
Total current assets | 2,572,977 | (29,162 | ) | 2,543,815 | |||||||
Property, plant and equipment, net | 3,259,529 | (4,553 | ) | (b) | 3,254,976 | ||||||
Intangible assets, net | 1,019,548 | — | 1,019,548 | ||||||||
Deferred income taxes, net | 9,514 | — | 9,514 | ||||||||
Other assets | 577,218 | — | 577,218 | ||||||||
Total assets | $ | 7,438,786 | $ | (33,715 | ) | $ | 7,405,071 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
Current liabilities | |||||||||||
Accounts payable | $ | 264,508 | $ | (15,099 | ) | (b) | $ | 249,409 | |||
Accrued expenses and other | 804,483 | (12,609 | ) | (b) | 791,874 | ||||||
Deferred revenues | 111,728 | (395 | ) | (b) | 111,333 | ||||||
Current portion of long-term debt | 5,555,298 | — | 5,555,298 | ||||||||
Deposits related to 2013 sale of towers | 725,611 | — | 725,611 | ||||||||
Total current liabilities | 7,461,628 | (28,103 | ) | 7,433,525 | |||||||
Long-term debt | 221,598 | — | 221,598 | ||||||||
Deferred revenues | 9,923 | — | 9,923 | ||||||||
Deferred income tax liabilities | 89,285 | — | 89,285 | ||||||||
Other long-term liabilities | 239,899 | (5,239 | ) | (b) | 234,660 | ||||||
Total liabilities | 8,022,333 | (33,342 | ) | 7,988,991 | |||||||
Stockholders’ deficit | |||||||||||
Undesignated preferred stock, par value $0.001, 10,000 shares authorized, no shares issued or outstanding | — | — | — | ||||||||
Common stock, par value $0.001, 600,000 shares authorized, 172,362 shares issued and outstanding | 172 | — | 172 | ||||||||
Paid-in capital | 1,511,845 | — | 1,511,845 | ||||||||
Accumulated deficit | (1,192,356 | ) | 29,072 | (c) | (1,163,284 | ) | |||||
Accumulated other comprehensive loss | (903,208 | ) | (29,445 | ) | (b) | (932,653 | ) | ||||
Total stockholders’ deficit | (583,547 | ) | (373 | ) | (583,920 | ) | |||||
Total liabilities and stockholders’ deficit | $ | 7,438,786 | $ | (33,715 | ) | $ | 7,405,071 |
Historical | Pro Forma Adjustments for Activity of Business and Net Assets Disposed | Unaudited Pro Forma | |||||||||
Operating revenues | |||||||||||
Service and other revenues | $ | 1,807,030 | $ | (29,793 | ) | (d) | $ | 1,777,237 | |||
Handset and accessory revenues | 131,936 | (1,410 | ) | (d) | 130,526 | ||||||
1,938,966 | (31,203 | ) | 1,907,763 | ||||||||
Operating expenses | |||||||||||
Cost of service (exclusive of depreciation and amortization included below) | 704,492 | (36,137 | ) | (e) | 668,355 | ||||||
Cost of handsets and accessories | 539,864 | (9,823 | ) | (e) | 530,041 | ||||||
Selling, general and administrative | 934,272 | (35,017 | ) | (f) | 899,255 | ||||||
Impairment and restructuring charges | 157,743 | (127,515 | ) | (e) | 30,228 | ||||||
Depreciation | 310,890 | (3,281 | ) | (e) | 307,609 | ||||||
Amortization | 35,167 | (369 | ) | (e) | 34,798 | ||||||
2,682,428 | (212,142 | ) | 2,470,286 | ||||||||
Operating loss | (743,462 | ) | 180,939 | (562,523 | ) | ||||||
Other expense | |||||||||||
Interest expense, net | (260,606 | ) | 40 | (g) | (260,566 | ) | |||||
Interest income | 32,870 | (32 | ) | (d) | 32,838 | ||||||
Foreign currency transaction gains, net | 2,537 | 11,489 | (d) | 14,026 | |||||||
Other expense, net | (2,970 | ) | (26 | ) | (e) | (2,996 | ) | ||||
(228,169 | ) | 11,471 | (216,698 | ) | |||||||
Loss from continuing operations before income tax provision | (971,631 | ) | 192,410 | (779,221 | ) | ||||||
Income tax provision | (33,711 | ) | — | (33,711 | ) | ||||||
Net loss from continuing operations | $ | (1,005,342 | ) | $ | 192,410 | $ | (812,932 | ) | |||
Net loss from continuing operations per common share, basic and diluted | $ | (5.84 | ) | $ | 1.11 | (h) | $ | (4.73 | ) | ||
Weighted average number of common shares outstanding, basic and diluted | 172,201 | — | 172,201 |
Historical | Pro Forma Adjustments for Activity of Business and Net Assets Disposed | Unaudited Pro Forma | |||||||||
Operating revenues | |||||||||||
Service and other revenues | $ | 4,573,879 | $ | (56,726 | ) | (d) | $ | 4,517,153 | |||
Handset and accessory revenues | 198,685 | (15,952 | ) | (d) | 182,733 | ||||||
4,772,564 | (72,678 | ) | 4,699,886 | ||||||||
Operating expenses | |||||||||||
Cost of service (exclusive of depreciation and amortization included below) | 1,472,320 | (80,180 | ) | (e) | 1,392,140 | ||||||
Cost of handsets and accessories | 911,635 | (39,694 | ) | (e) | 871,941 | ||||||
Selling, general and administrative | 1,913,454 | (83,143 | ) | (f) | 1,830,311 | ||||||
Provision for doubtful accounts | 116,619 | (5,159 | ) | (e) | 111,460 | ||||||
Impairment and restructuring charges | 171,047 | (36,004 | ) | (e) | 135,043 | ||||||
Depreciation | 634,199 | (4,596 | ) | (e) | 629,603 | ||||||
Amortization | 64,148 | (824 | ) | (e) | 63,324 | ||||||
5,283,422 | (249,600 | ) | 5,033,822 | ||||||||
Operating loss | (510,858 | ) | 176,922 | (333,936 | ) | ||||||
Other expense | |||||||||||
Interest expense, net | (539,159 | ) | 12,629 | (g) | (526,530 | ) | |||||
Interest income | 43,379 | (52 | ) | (d) | 43,327 | ||||||
Foreign currency transaction losses, net | (143,745 | ) | 20,376 | (d) | (123,369 | ) | |||||
Other expense, net | (12,982 | ) | 124 | (e) | (12,858 | ) | |||||
(652,507 | ) | 33,077 | (619,430 | ) | |||||||
Loss from continuing operations before income tax provision | (1,163,365 | ) | 209,999 | (953,366 | ) | ||||||
Income tax provision | (446,052 | ) | — | (446,052 | ) | ||||||
Net loss from continuing operations | $ | (1,609,417 | ) | $ | 209,999 | $ | (1,399,418 | ) | |||
Net loss from continuing operations per common share, basic and diluted | $ | (9.36 | ) | $ | 1.23 | (h) | $ | (8.13 | ) | ||
Weighted average number of common shares outstanding, basic and diluted | 171,912 | — | 171,912 |
Historical | Pro Forma Adjustments for Activity of Business and Net Assets Disposed | Unaudited Pro Forma | |||||||||
Operating revenues | |||||||||||
Service and other revenues | $ | 5,465,120 | $ | (40,354 | ) | (d) | $ | 5,424,766 | |||
Handset and accessory revenues | 278,002 | (9,532 | ) | (d) | 268,470 | ||||||
5,743,122 | (49,886 | ) | 5,693,236 | ||||||||
Operating expenses | |||||||||||
Cost of service (exclusive of depreciation and amortization included below) | 1,574,327 | (64,785 | ) | (e) | 1,509,542 | ||||||
Cost of handsets and accessories | 829,859 | (37,392 | ) | (e) | 792,467 | ||||||
Selling, general and administrative | 2,167,688 | (120,220 | ) | (f) | 2,047,468 | ||||||
Provision for doubtful accounts | 217,315 | (2,861 | ) | (e) | 214,454 | ||||||
Impairment and restructuring charges | 329,767 | (299,366 | ) | (e) | 30,401 | ||||||
Depreciation | 601,769 | (43,545 | ) | (e) | 558,224 | ||||||
Amortization | 47,776 | (838 | ) | (e) | 46,938 | ||||||
5,768,501 | (569,007 | ) | 5,199,494 | ||||||||
Operating (loss) income | (25,379 | ) | 519,121 | 493,742 | |||||||
Other expense | |||||||||||
Interest expense, net | (365,521 | ) | 5,727 | (g) | (359,794 | ) | |||||
Interest income | 33,862 | (77 | ) | (d) | 33,785 | ||||||
Foreign currency transaction losses, net | (53,957 | ) | (9,372 | ) | (d) | (63,329 | ) | ||||
Other expense, net | (28,340 | ) | 242 | (e) | (28,098 | ) | |||||
(413,956 | ) | (3,480 | ) | (417,436 | ) | ||||||
(Loss) income from continuing operations before income tax provision | (439,335 | ) | 515,641 | 76,306 | |||||||
Income tax provision | (158,144 | ) | — | (158,144 | ) | ||||||
Net loss from continuing operations | $ | (597,479 | ) | $ | 515,641 | $ | (81,838 | ) | |||
Net loss from continuing operations per common share, basic and diluted | $ | (3.48 | ) | $ | 3.00 | (h) | $ | (0.48 | ) | ||
Weighted average number of common shares outstanding, basic and diluted | 171,499 | — | 171,499 |
Historical | Pro Forma Adjustments for Activity of Business and Net Assets Disposed | Unaudited Pro Forma | |||||||||
Operating revenues | |||||||||||
Service and other revenues | $ | 6,081,577 | $ | (26,933 | ) | (d) | $ | 6,054,644 | |||
Handset and accessory revenues | 299,240 | (171 | ) | (d) | 299,069 | ||||||
6,380,817 | (27,104 | ) | 6,353,713 | ||||||||
Operating expenses | |||||||||||
Cost of service (exclusive of depreciation and amortization included below) | 1,681,692 | (35,714 | ) | (e) | 1,645,978 | ||||||
Cost of handsets and accessories | 784,072 | (4,837 | ) | (e) | 779,235 | ||||||
Selling, general and administrative | 2,201,102 | (61,336 | ) | (f) | 2,139,766 | ||||||
Provision for doubtful accounts | 159,201 | (1,671 | ) | (e) | 157,530 | ||||||
Depreciation | 551,463 | (24,467 | ) | (e) | 526,996 | ||||||
Amortization | 36,701 | (712 | ) | (e) | 35,989 | ||||||
5,414,231 | (128,737 | ) | 5,285,494 | ||||||||
Operating income | 966,586 | 101,633 | 1,068,219 | ||||||||
Other expense | |||||||||||
Interest expense, net | (311,735 | ) | 2,456 | (g) | (309,279 | ) | |||||
Interest income | 34,096 | (268 | ) | (d) | 33,828 | ||||||
Foreign currency transaction losses, net | (37,297 | ) | 7,177 | (d) | (30,120 | ) | |||||
Other expense, net | (37,750 | ) | (27 | ) | (e) | (37,777 | ) | ||||
(352,686 | ) | 9,338 | (343,348 | ) | |||||||
Income from continuing operations before income tax provision | 613,900 | 110,971 | 724,871 | ||||||||
Income tax provision | (351,206 | ) | — | (351,206 | ) | ||||||
Net income from continuing operations | $ | 262,694 | $ | 110,971 | $ | 373,665 | |||||
Net income from continuing operations per common share, basic | $ | 1.53 | $ | 0.65 | (h) | $ | 2.18 | ||||
Net income from continuing operations per common share, diluted | $ | 1.52 | $ | 0.64 | (h) | $ | 2.16 | ||||
Weighted average number of common shares outstanding, basic | 170,601 | — | 170,601 | ||||||||
Weighted average number of common shares outstanding, diluted | 172,781 | — | 172,781 |
Note 1. | Basis of Presentation |
Note 2. | Pro Forma Adjustments |
(a) | Reflects the net effect of the elimination of cash and cash equivalents, a de minimus amount of proceeds received upon completion of the sale of Nextel Chile and an immaterial amount of estimated transaction costs. |
(b) | Reflects the elimination of certain of Nextel Chile's assets and liabilities. These adjustments also include the realization of foreign currency translation adjustments related to the historical operations of Nextel Chile. |
(c) | Represents the effect on retained earnings as a result of the estimated $29.1 million gain recognized on the sale of Nextel Chile. |
(d) | Reflects the elimination of revenue, interest income and other income historically reported by Nextel Chile that the Company would not have recognized if the sale of this operating company had occurred on January 1, 2011. |
(e) | Reflects the elimination of expenses as a result of the sale of Nextel Chile. For the indicated line items, all activity historically reported as part of the Nextel Chile business has been eliminated, and no other adjustments or allocations have been assumed. |
(f) | Reflects the elimination of selling, general and administrative expenses as a result of the sale of Nextel Chile. This adjustment also includes stock-based compensation expense related to Nextel Chile employees that would not have been recognized if the sale of this operating company had occurred on January 1, 2011. |
(g) | Reflects the elimination of interest expense as a result of the sale of Nextel Chile. This adjustment does not include allocations of interest expense related to corporate-level debt obligations. |
(h) | Recalculated as the pro forma adjustment to net (loss) income from continuing operations divided by the weighted average number of basic and diluted shares outstanding for the respective period. |