Market Overview

Liberty Global Reports Third Quarter 2019 Results

Share:

Accelerated our Gigabit broadband rollout to millions of European homes and businesses

Completed $2.7 billion tender offer for Class A & C shares in September

Q3 2019 operating income up 1.8% YoY to $208.8 million for continuing operations

Capital intensity continues to decrease substantially fueling YTD1 OFCF growth2 of 80%

Liberty Global (NASDAQ:LBTYA, LBTYB and LBTYK)):

 

 

 

Continuing Operations (Including Switzerland)

Q3 2019

 

YTD 2019

 

 

Organic RGU Additions

(76,300

)

 

(80,400

)

 

 

Revenue Growth2

(0.6

)%

 

(0.7

)%

 

 

OCF Growth2

(4.1

)%

 

(3.0

)%

 

 

OFCF Growth2

34.8

%

 

42.1

%

 

 

 

 

 

 

 

 

Continuing Operations (Excluding Switzerland)3

Q3 2019

 

YTD 2019

 

 

Organic RGU Additions

(62,200

)

 

4,600

 

 

 

Revenue Growth2

(0.2

)%

 

(0.3

)%

 

 

OCF Growth2

(2.9

)%

 

(1.8

)%

 

 

OFCF Growth2

63.1

%

 

79.7

%

 

 

 

 

 

 

 

2019 Guidance Targets5

Excluding CH

 

Including CH

 

 

OCF Growth3

Flat to Down

 

Modest Decline

 

 

Adjusted FCF4

$550-$600 mm

 

$700-$750 mm

 

 

P&E Additions

~$2.7 bn

 

~$2.8-$2.9 bn

 

 

 

 

Liberty Global plc today announced its Q3 2019 financial results. Our former operations in Austria, Germany, Hungary, Romania and the Czech Republic, along with our DTH business (collectively, the "Discontinued Operations") have been accounted for as discontinued operations. Unless otherwise indicated, the information in this release relates only to our continuing operations.

CEO Mike Fries stated, "Over the past two years, we have undertaken a substantial reshaping of our distribution footprint, taking advantage of the fixed-mobile convergence wave across Europe with transactions that recognize the premium value of broadband networks. As a result of this rebalancing, we find ourselves in an enviable position from both operating and liquidity perspectives.

We have substantial scale in our remaining businesses, with 31 million consolidated fixed and mobile subscribers, generating approximately $5 billion of OCF per annum, and an additional 15 million fixed and mobile subscribers and $2 billion in annual OCF from our VodafoneZiggo joint venture in the Netherlands. In all markets we are leading the way with gigabit broadband speeds, converged fixed-mobile bundles, and a focus on profitable subscriber growth."

"Just as importantly, we are entering a new phase of operating and free cash flow expansion with capital intensity down 29%1 through nine months and operating free cash flow up 80%1. Not surprisingly we are confirming our OCF and FCF guidance for the full year.

One of the highlights of the quarter was the successful completion of our modified Dutch auction tender offers. We were able to purchase nearly 100 million shares in total at a blended average price of just over $27 per share, which represented around 14% of our shares outstanding, for a combined aggregate cost of $2.7 billion. Today we have $10 billion of liquidity 6 on the balance sheet and remain focused on long-term value creation.

While we are disappointed that Sunrise was unable to obtain approval for the financing of their acquisition of our Swiss operation3, we are excited with the progress we continue to make in that market. All of our key operating metrics - fixed subscriber movement, ARPU growth, NPS, mobile net adds - are moving in the right direction. Like the rest of Europe, Switzerland is rapidly converging around fixed-mobile services, and our gigabit broadband networks and superior TV platform are the fulcrum assets in that market.

Our third quarter 2019 earnings call is tomorrow morning at 9:00 a.m. E.T. and we hope you can join us."

About Liberty Global

Liberty Global (NASDAQ:LBTYA, LBTYB and LBTYK)) is one of the world's leading converged video, broadband and communications companies, with operations in six European countries under the consumer brands Virgin Media, Telenet and UPC. We invest in the infrastructure and digital platforms that empower our customers to make the most of the digital revolution. Our substantial scale and commitment to innovation enable us to develop market-leading products delivered through next-generation networks that connect 11 million customers subscribing to 25 million TV, broadband internet and telephony services. We also serve 6 million mobile subscribers and offer WiFi service through millions of access points across our footprint.

In addition, Liberty Global owns 50% of VodafoneZiggo, a joint venture in the Netherlands with 4 million customers subscribing to 10 million fixed-line and 5 million mobile services, as well as significant investments in ITV, All3Media, ITI Neovision, LionsGate, the Formula E racing series and several regional sports networks.

Q3 Highlights (on a continuing operations basis unless otherwise noted)

  • Q3 rebased revenue decreased 0.6% to $2,840.9 million
    • Q3 residential cable revenue7 decreased 1.3% YoY to $1,821.8 million
      • Results driven by revenue contractions in Switzerland and Belgium
    • Q3 residential mobile revenue7 increased 0.8% YoY to $401.0 million
      • Performance driven by strong Swiss result
    • Q3 B2B8 revenue7 decreased 0.7% YoY to $463.3 million
      • Strong growth in Switzerland and CEE offset by declines at our other operations
  • Q3 operating income increased 1.8% YoY to $208.8 million
  • Q3 rebased OCF declined by 4.1% to $1,211.7 million
  • Q3 property & equipment additions spend at 23.2% of revenue as compared to 30.3% in Q3 2018
  • Built 162,000 new premises during Q3, including 119,000 new premises in the U.K. & Ireland
  • Completed $2.7 billion tender offer in September
  • Solid balance sheet with $9.9 billion of liquidity6 at Q3
  • Net leverage9 of 3.6x at Q3
  • Fully-swapped borrowing cost of 4.1% on debt balance of $27.0 billion

 

Liberty Global (continuing operations)

 

Q3 2019

 

YoY Growth(i)

 

YTD 2019

 

View Comments and Join the Discussion!
 
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com