- The Washington Times - Monday, March 14, 2005

Reston-based NII Holdings nearly doubled the number of its wireless service customers last year and is on course for similar growth this year.

The company sells to Latin American business customers, particularly in Mexico, Brazil, Argentina, Peru and Chile.

Its fourth-quarter profit rose 14 percent to $40.8 million, or 52 cents per share, from $35.8 million, or 52 cents per share, a year earlier.

The company added 414,600 subscribers in 2004 to a total of about 1.9 million.

NII appears to be focusing its market more heavily on Mexico, according to analysts from Wright Investor’s Service.

The company “has changed its product mix within the past five years,” Wright Investor’s Service analysts reported. “In 2003, the largest segment was Mexico, while in 1999, the largest segment was Argentina. During the past four years, salesof Mexico increased 2,219.3 percent while during the same period, sales of Argentina experienced an increase of only 189.8 percent.”

NII is 18 percent owned by telecommunications giant Nextel Communications.

“As we head into 2005, NII is in the sweet spot with regard to significantly growing its business through expansion into new markets in Mexico and Brazil, as well as capitalizing on its strengths in attracting and retaining the highest value wireless customers in its Latin American markets,” said Steve Shindler, NII Holdings’ chief executive officer.

NII Holdings closed yesterday at $56.24 per share on the Nasdaq exchange, down 23 cents, or 0.41 percent from Friday’s close.

The company’s guidance for this year projects adding 475,000, or 25 percent, more subscribers. It also says NII should earn operating income before depreciation and amortization of $450 million, or nearly 30 percent more than 2004.

The company projects that operating revenue will increase 21 percent to $1.55 billion. Analysts estimate it will earn revenue of $1.54 billion.

NII distinguishes itself from competitors by focusing on high-end business customers and providing them with greater customer service.

Most Latin American wireless service is standardized for all customers, prepaid and with little customer care.

“When we sign up a customer, we work very directly on a custom communications solution package,” said Tim Perrott, NII’s vice president of investor relations.

The company sends a representative to each “high-value customer” to design a wireless service for the business based on its needs.

After the service is started, a representative contacts the customers to ensure they are satisfied.

Corporate clients have a customer service representative assigned to them.

“That’s a very different approach from some of our competitors in the prepaid market,” Mr. Perrott said.

In addition, NII gives its customers handsets that combine cell phone, e-mail, paging and push-to-talk walkie-talkie capabilities in a single unit.

Among its recent accomplishments, NII bid successfully to operate its wireless system on Mexico’s 800 MHz spectrum, winning an average of 15 MHz of additional spectrum per basic service area.

The company also closed on a $250 million, five-year syndicated loan facility in Mexico.

Both accomplishments put NII in a good position for growth in Mexico.

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