Sprint Corp. (NYSE: S) reported Q4 EPS of ($0.14), versus ($0.06) reported last year. Revenue for the quarter came in at $8.07 billion, versus $8.11 billion reported last year.

Wireless service revenue plus installment plan billings and lease revenue, which represents the total recurring cash flows from customers, was $7.1 billion in the fiscal fourth quarter and increased one percent from the prior year period, as growth in both postpaid phone customers and postpaid average billings per user* were partially offset by lower prepaid service revenue.For the full year, wireless service revenue plus installment plan billings and lease revenue of $28.4 billion was up slightly from the prior year.

$11 Billion of Committed Liquidity

Sprint has taken several actions to improve its financial flexibility and currently has $11 billion of committed liquidity, up from $6 billion at the end of the fiscal third quarter. The company also has an additional $1.2 billion of availability under vendor financing agreements that can be used toward the purchase of 2.5 GHz network equipment.

• Total liquidity at the end of fiscal year 2015 was $5.7 billion, including $2.6 billion of cash and cash equivalents, $3 billion of undrawn borrowing capacity under the revolving bank credit facility, and approximately $100 million of undrawn availability under the receivables facility.
• Sprint received $2.2 billion from the sale and lease-back of certain existing network assets at an attractive cost of funding in the mid-single digits. This transaction did not include any of the company’s spectrum assets.
• The company executed its second sale-leaseback transaction of certain leased devices with MLS, providing a $1.1 billion cash infusion.
• Sprint signed an 18-month bridge financing facility for $2 billion with better terms than its alternatives in the high-yield debt market.

These sources of liquidity are expected to provide the resources for the company to execute its transformation plan and fully fund the repayment of the $3.3 billion of note maturities that come due in fiscal year 2016. The company continues to consider financing initiatives, including structures that would involve a small portion of its spectrum assets, as well as additional transactions with MLS to fund its transformation, continue to improve the network, and meet its future financial obligations.

Postpaid Phone Customer Growth Continues

Sprint has been focused on attracting and retaining higher value postpaid phone customers and added 22,000 of these customers in a highly competitive fiscal fourth quarter, bringing the fiscal year total to 438,000 – an improvement of nearly two million from the prior year and the third consecutive quarter of positive postpaid phone net additions.

Significant network improvements, a more compelling value proposition, and better customer quality have led to higher customer retention, with postpaid phone churn reaching a record low of 1.52 percent in fiscal year 2015 and improving by approximately 50 basis points year-over-year. For the fiscal fourth quarter, postpaid phone churn of 1.56 percent improved 22 basis points year-over-year.

In addition, the company also saw year-over-year growth in postpaid phone gross additions for both the fiscal fourth quarter and full year.

The company also reported the following Sprint platform results:

• Total net additions were 447,000 in the fiscal fourth quarter, including postpaid net additions of 56,000, prepaid net losses of 264,000, and wholesale and affiliate net additions of 655,000.For the full year, total net additions were nearly 2.7 million, including postpaid net additions of more than 1.2 million, prepaid net losses of 1.3 million, and wholesale and affiliate net additions of over 2.7 million.

• Postpaid churn of 1.72 percent in the fiscal fourth quarter improved by 12 basis points year-over-year and was the lowest ever for a fiscal fourth quarter.For the full year, postpaid churn of 1.61 percent was also the best in company history and improved by approximately 50 basis points year-over-year.

Outlook

• The company expects fiscal year 2016 Adjusted EBITDA* to be $9.5 billion to $10 billion.
• The company expects fiscal year 2016 operating income to be $1 billion to $1.5 billion.
• The company expects fiscal year 2016 cash capital expenditures, excluding indirect channel device leases, to be approximately $3 billion, as non-network expenditures are expected to decline year-over-year and more of the cash outlays related to network densification are expected to be incurred in fiscal year 2017. The company’s deep spectrum position and its small cell focused densification are also expected to improve overall capital efficiency.
• The company expects fiscal year 2016 Adjusted free cash flow* to be around break-even.

For earnings history and earnings-related data on Sprint Corp. (S) click here.