NII Holdings Inc. (NIHD:US), the provider of Nextel-branded service in Latin America, rose as much as 8.6 percent after adding users and naming interim Chief Executive Officer Steven Shindler to the job permanently.
NII added 152,000 subscribers to its network last quarter, increasing its total by 5 percent to 11.5 million, the Reston, Virginia-based company said today in a statement. Adjusted earnings before interest, taxes, depreciation and amortization were $230 million. That topped the $192 million estimated by Jennifer Fritzsche, an analyst at Wells Fargo & Co. in Chicago.
The shares (NIHD:US) rose 3.6 percent to $8.63 at 9:43 a.m. in New York. The reached as high as $9.05 earlier. The stock had climbed 17 percent this year through yesterday.
The appointment of Shindler to the permanent CEO job also is good news, Fritzsche said. He served as the company’s CEO from 2000 and 2008 and that experience will help him confront NII’s current challenges, she said. The wireless carrier is reorganizing assets as it struggles with larger competitors such as America Movil SAB and Telefonica SA. (TEF) It’s counting on new third-generation networks to attract more customers.
Shindler retaking the CEO job is “an extremely positive development as Shindler was the one to successfully oversee NIHD during prior transitions,” Fritzsche said in a note to clients.
Shindler had been serving as the company’s chairman. The board is now considering splitting the CEO and chairman roles, NII said in a statement.
“I will continue to focus my attention on the build-out of our 3G networks, high-quality subscriber growth, key financial metrics and providing a quality product,” Shindler said in the statement today.
Even as the Ebitda figure improved, the company continues to post net losses, including $207.5 million, or $1.21 a share, in the first quarter. Sales declined to $1.41 billion from $1.63 billion.
Still, a comeback appears to under way, especially in Brazil, which has been one of NII’s more challenging markets, Fritzsche said. The company had its first subscriber growth in the country since the second quarter of 2012, she said.
“Q1 gave us strong evidence that the foundation for this turnaround is being laid,” she said.
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