<PAGE> 1
EXHIBIT 99.1
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NEWS RELEASE
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[NEXTEL LOGO] NEXTEL COMMUNICATIONS, INC.
2001 Edmund Halley Drive
Reston, VA 20191
703 433-4000
CONTACTS:
INVESTORS: PAUL BLALOCK (703) 433-4300
MEDIA: BEN BANTA (703) 433-4700
NEXTEL REPORTS RECORD SECOND QUARTER 2000 RESULTS
- GLOBAL DIGITAL PROPORTIONATE SUBSCRIBER ADDITIONS OF 677,000 -
- RECORD SUBSCRIBER REVENUE AND CASH FLOW -
- NEXTEL INTERNATIONAL GAINS MOMENTUM IN LATIN AMERICA -
RESTON, Va. - July 18, 2000 - Nextel Communications, Inc., (NASDAQ: NXTL) today
reported its financial results for the second quarter of 2000 including the
addition of a record setting 677,000 global digital proportionate subscribers,
improved revenue and cash flow trends and solid momentum in the Latin American
operations of Nextel International. Nextel ended the second quarter with a
global subscriber base of approximately 6.2 million global digital proportionate
subscribers.
Consolidated operations produced a 59% increase in revenue to $1.26 billion for
the second quarter of 2000 as compared to consolidated revenue of $793 million
in the second quarter of 1999. Consolidated operating cash flow (earnings before
interest, taxes, depreciation and amortization) increased 166% to $290 million
for the second quarter of 2000 as compared to $109 million of consolidated
operating cash flow during the second quarter of 1999.
Domestic operations produced record setting subscriber additions of 560,600, and
increased average monthly revenue per domestic subscriber of approximately $74.
Domestic operations experienced a 55% increase in revenue to $1.20 billion as
compared to second quarter 1999's domestic revenue of $771 million. Second
quarter domestic operating cash flow grew 108% to a record $323 million, as
compared to second quarter 1999's domestic operating cash flow of $155 million.
Domestic operating income grew 247% to $52 million for the second quarter 2000
as compared to first quarter 2000's operating income of $15 million. The monthly
churn rate for the second quarter of 2000 remained at one of the best levels in
the wireless industry at approximately 2% for domestic customers. Nextel ended
the second quarter with approximately 5,616,600 domestic digital subscribers.
"Strong global demand for Nextel's differentiated service produced another
record setting quarter. Increased revenue, and net subscriber additions and
record cash flow are particularly pleasing in light of the increasingly
competitive national and global wireless marketplace," said Tim Donahue,
Nextel's president and CEO. "We are encouraged by the strong initial customer
demand for our new Nextel Worldwide(SM) global roaming service and excited about
the enhanced differentiation that our new Nextel Online(SM) wireless Internet
services are beginning to offer to broader groups of customers. Nextel expects
to continue to meet the challenges of greater wireless demand in the coming
quarters and continue our leadership in the emerging global wireless
marketplace."
"For the sixth consecutive quarter, Nextel has attracted greater domestic net
subscriber additions while maintaining the highest subscriber quality in the
industry," said Steve Shindler, Nextel's CFO and Nextel International's CEO.
"With more than $20 of monthly cash flow per subscriber from domestic
operations, Nextel has increased its lifetime revenue per subscriber to an
industry-leading $3,700 and we continue to set the pace in the domestic wireless
industry. Nextel International continued to gain momentum posting a record
116,400 proportionate subscriber additions in the second quarter. When compared
with second
<PAGE> 2
quarter 1999 results, Nextel International's revenue increased by 191% and the
operating cash flow losses declined by 28% in the second quarter of 2000."
The consolidated net loss per share for the second quarter of 2000 was $0.38 per
share - a 27% improvement when compared to the $0.52 per share loss for the
second quarter of 1999. The net loss per share figures reflect the 2-for-1 stock
split which occurred during June 2000. The weighted average number of shares
outstanding was approximately 760 million for the second quarter 2000. Domestic
capital expenditures were $686 million for the second quarter of 2000 as
compared to $661 million in the first quarter of 2000.
Total domestic system minutes of use on the Nextel National Network increased
77% when compared with the same period in 1999 to approximately 7.6 billion
minutes - reflecting increased customer demand to approximately 480 minutes of
use per customer per month for Nextel's differentiated wireless services. During
the second quarter, approximately 14.6 million Internet text messages were sent
on the Nextel National Network, representing a 156% increase over last year's
second quarter Internet text messages.
NEXTEL INTERNATIONAL
Consolidated digital subscribers in Nextel International's managed markets in
Latin America grew by approximately 109,700 during the second quarter 2000 to
469,100 subscribers. This represents an increase of approximately 205% over the
second quarter of 1999 consolidated subscriber base of 154,000. Nextel
International ended the second quarter of 2000 with about 1,225,900 subscribers
spread throughout the markets where it has an ownership interest and 578,500
proportionate subscribers. During the second quarter 2000, Nextel International
increased its ownership interest in Brazil to 92% and in Peru to 100%. Nextel
International also agreed to sell its ownership interest in Shanghai, China, and
purchased spectrum in Santiago, Chile, during the second quarter of 2000.
Nextel International's consolidated revenue increased 191% to $64 million as
compared to second quarter 1999's revenue of $22 million. Operating cash flow
losses decreased 28% to $33 million as compared to 1999's second quarter loss of
$46 million. International capital expenditures were $137 million in the second
quarter of 2000 as compared with $116 million in the first quarter 2000.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act of
1995. A number of the matters and subject areas discussed in this press release
that are not historical or current facts deal with potential future
circumstances and developments. The discussion of such matters and subject areas
is qualified by the inherent risks and uncertainties surrounding future
expectations generally, and also may materially differ from Nextel and Nextel
International's actual future experience involving any one or more of such
matters and subject areas. Nextel and Nextel International have attempted to
identify, in context, certain of the factors that they currently believe may
cause actual future experience and results to differ from Nextel's and/or Nextel
International's current expectations regarding the relevant matter or subject
area. Such risks and uncertainties include those that are described from time to
time in Nextel's and Nextel International's reports filed with the SEC,
including Nextel's and Nextel International's Annual Report on Form 10-K for the
fiscal year ended December 31, 1999 and in the 10-Q's for the first quarter of
2000 filed by Nextel and Nextel International.
Nextel Communications, Inc., based in Reston, VA, is the leading provider of
fully integrated wireless communications services and has built the largest
guaranteed all-digital wireless network in the United States covering thousands
of communities across the United States. Nextel and Nextel Partners, Inc.,
currently serve 98 of the top 100 U.S. markets. Through recent market launches,
Nextel and Nextel Partners' service is available today in areas of the U.S.
where approximately 193 million people live or work. The Nextel National Network
offers a fully integrated wireless communications tool with digital cellular,
text/numeric paging, wireless Internet access and Nextel Direct Connect(R) - a
digital two-way radio feature. In addition, through Nextel International, Inc.,
Nextel has wireless operations and investments in Canada, Mexico, Argentina,
Brazil, the Philippines, Peru, Chile and Japan. Please visit our website at
http://www.nextel.com.
- MORE -
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NEXTEL COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
Unaudited
<TABLE>
<CAPTION>
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
------------------------------ ------------------------------
2000 1999 2000 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
OPERATING REVENUES $ 2,339 $ 1,457 $ 1,260 $ 793
------------ ------------ ------------ ------------
OPERATING EXPENSES
Cost of revenues 474 329 260 166
Selling, general and administrative 1,347 984 710 518
------------ ------------ ------------ ------------
EBITDA 518 144 290 109
Depreciation and amortization 583 471 303 243
------------ ------------ ------------ ------------
OPERATING LOSS (65) (327) (13) (134)
Interest expense (579) (407) (301) (209)
Interest income 187 12 104 8
Debt conversion expense (23) -- -- --
Equity in losses of unconsolidated affiliates (71) (31) (36) (25)
Foreign currency transaction gains (losses), net 6 (46) (6) 21
Other income, net 9 75 3 64
------------ ------------ ------------ ------------
LOSS BEFORE INCOME TAX BENEFIT (536) (724) (249) (275)
Income tax benefit 16 17 8 7
------------ ------------ ------------ ------------
LOSS BEFORE EXTRAORDINARY ITEM (520) (707) (241) (268)
Extraordinary loss from extinguishment of debt (104) -- -- --
Mandatorily redeemable preferred stock dividends (103) (93) (51) (47)
------------ ------------ ------------ ------------
LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ (727) $ (800) $ (292) $ (315)
============ ============ ============ ============
LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS,
BASIC AND DILUTED:
Loss before extraordinary item attributable to
common stockholders $ (0.83) $ (1.35) $ (0.38) $ (0.52)
Extraordinary item (0.14) -- -- --
------------ ------------ ------------ ------------
$ (0.97) $ (1.35) $ (0.38) $ (0.52)
=========== ============ ============ ===========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING 751 594 760 606
============ ============ ============== ============
</TABLE>
SELECTED BALANCE SHEET AND OTHER DATA
(in millions, except unit data)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
2000 1999
-------------- -------------
(Unaudited)
<S> <C> <C>
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS $ 6,369 $ 5,808
PROPERTY, PLANT AND EQUIPMENT, NET 7,295 6,152
INTANGIBLE ASSETS, NET 4,597 4,551
TOTAL ASSETS 20,292 18,410
LONG-TERM DEBT, including current portion of $68 and $1,165 12,869 10,925
MANDATORILY REDEEMABLE PREFERRED STOCK 1,775 1,770
TOTAL STOCKHOLDERS' EQUITY 2,236 2,574
DIGITAL UNITS IN SERVICE:
Domestic 5,616,600 4,515,700
============= =============
Global - proportionate (1) 6,195,100 4,919,200
============= =============
</TABLE>
<TABLE>
<CAPTION>
THREE MONTHS ENDED
-------------------------------------
JUNE 30, MARCH 31,
2000 2000
--------------- -------------
<S> <C> <C>
CONSOLIDATED CAPITAL EXPENDITURES $ 823 $ 777
============ ============
</TABLE>
(1) December 31, 1999 subscriber count includes units attributable to
Nextel's investment in our affiliate in Shanghai, China. These subscriber
units are excluded from the total subscriber count as of June 30, 2000.
- MORE -
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NEXTEL INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions)
Unaudited
<TABLE>
<CAPTION>
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
------------------------------ ------------------------------
2000 1999 2000 1999
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
OPERATING REVENUES $ 111 $ 42 $ 64 $ 22
------------ ------------ ------------ ------------
OPERATING EXPENSES
Cost of revenues 29 18 15 9
Selling, general and administrative 149 117 82 59
------------ ------------ ------------ ------------
EBITDA (67) (93) (33) (46)
Depreciation and amortization 65 52 32 28
------------ ------------ ------------ ------------
OPERATING LOSS (132) (145) (65) (74)
Interest expense (107) (82) (55) (44)
Interest income 5 3 5 1
Equity in losses of unconsolidated affiliates (17) (11) (10) (6)
Foreign currency transaction gains (losses), net 6 (46) (6) 21
Other income, net 4 13 1 --
------------ ------------ ------------ ------------
LOSS BEFORE INCOME TAX BENEFIT (241) (268) (130) (102)
Income tax benefit -- -- -- --
------------ ------------ ------------ ------------
NET LOSS $ (241) $ (268) $ (130) $ (102)
============= ============ ============= ============
</TABLE>
SELECTED BALANCE SHEET AND OTHER DATA
(in millions, except unit data)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
2000 1999
----------- ----------
(Unaudited)
<S> <C> <C>
CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS $ 297 $ 100
PROPERTY, PLANT AND EQUIPMENT, NET 755 539
INTANGIBLE ASSETS, NET 506 455
TOTAL ASSETS 2,124 1,682
LONG-TERM DEBT, including current portion of $67 and $33 1,734 1,548
TOTAL STOCKHOLDERS' DEFICIT (4) (180)
INTERNATIONAL DIGITAL UNITS IN SERVICE (1):
Total 1,225,900 1,245,600
=========== =========
Proportionate 578,500 403,500
=========== =========
</TABLE>
<TABLE>
<CAPTION>
THREE MONTHS ENDED
-----------------------------------
JUNE 30, MARCH 31,
2000 2000
------------ -----------
<S> <C> <C>
INTERNATIONAL CAPITAL EXPENDITURES $ 137 $ 116
============ ===========
</TABLE>
(1) December 31, 1999 subscriber count includes units attributable to
Nextel's investment in our affiliate in Shanghai, China. These subscriber
units are excluded from the total subscriber count as of June 30, 2000.
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