Improved sequential Adj. EBITDA performance across FMC
Champions, broadly stable aggregate1 connectivity despite price
rise announcements
Proposal to redomicile to Bermuda approved by a shareholders,
completion expected in Q4 this year
Successfully acquired over 93% of Telenet, offer will reopen
August 24 to September 13, providing an additional opportunity for
TNET shareholders
Repurchased ~$740 million of stock YTD2, representing 8% of
shares outstanding; buyback plan now increased to a minimum of
15%
On track for all full-year 2023 OpCo and Group guidance3
targets
Liberty Global plc today announced its Q2 2023 financial
results.
CEO Mike Fries stated, “We saw improved sequential Adjusted
EBITDA performance in Q2, underpinning the confirmation of all
full-year guidance targets across our core FMC operations. Demand
for reliable high-speed connectivity remains strong and despite
communicating price adjustments across our footprint, we delivered
broadly stable aggregate1 net adds in the second quarter. Looking
forward to H2, these price adjustments should increasingly help to
offset anticipated headwinds from energy and labor costs currently
affecting our FMC businesses. Despite tough macro conditions, we
continue to invest heavily in future-proofing our fixed and mobile
networks and position ourselves for long-term value creation. Given
our ample liquidity4 at Q2, as well as confidence in our 2023
distributable cash flow outlook, we are announcing an increase of
our share repurchase program to a minimum of 15% of shares
outstanding from 10% previously.
Commercial momentum in Q2 was affected by the announcement
and/or implementation of price increases throughout our markets.
While these adjustments will support Adjusted EBITDA through the
second half of the year, we have already seen an impact on our Q2
subscriber activity, reporting an aggregate loss of 60,000 net
broadband subscribers. Mobile trends have shown more resiliency and
we added 50,500 aggregate postpaid net subscribers in Q2 across our
footprint. On the financial front, we have yet to see the full
impact of the aforementioned price actions. As expected, the
previously-flagged phasing related to the timing of prices
increases together with continued cost inflation impacted our
Adjusted EBITDA result in the second quarter.
On the strategic front, Q2 was another busy quarter. We are
pleased with the strong shareholder support for the now pending
transition of our jurisdiction of incorporation from England and
Wales to Bermuda. This change will greatly facilitate the planning
and execution of corporate transactions aimed at enhancing
shareholder value. Despite this change, which is expected to take
effect in Q4, we maintain our unwavering commitment to our
businesses in the U.K. and the rest of Europe. We will continue to
provide market-leading products and services to our customers,
prioritize in-country employment, and make crucial investments in
critical infrastructure. Additionally, in July we acquired over 93%
of Telenet’s shares in the tender offer that we launched in Q2, and
the offer will reopen in late August to allow investors who missed
the initial acceptance period the opportunity to tender their
shares. Results of the upcoming acceptance period will be announced
during the third quarter.
We are well positioned to achieve all of the 2023 full-year
guidance metrics at our operating companies, as well as $1.6
billion of Distributable Cash Flow(i) at Liberty Global. This
positive outlook is backed by shareholder distributions from our
joint ventures in the U.K. and the Netherlands and Adjusted Free
Cash Flow from our consolidated operating companies in Switzerland
and Belgium. Furthermore, our balance sheet remains robust, with
approximately $5.5 billion of total liquidity, including $2.7
billion in corporate cash(ii), and no material debt maturities
until 2028. Our stock continues to offer appealing value at its
current price levels. We have already repurchased ~$740 million
worth of stock as of July 21 and we are announcing an increase to
our buyback target to a minimum of at least 15% of shares
outstanding for 2023."
(i)
Quantitative reconciliations to cash flow
from operating activities for our Distributable Cash Flow guidance
cannot be provided without unreasonable efforts as we do not
forecast specific changes in working capital that impact cash flows
from operating activities. The items we do not forecast may vary
significantly from period to period. 2023 Distributable Cash Flow
guidance reflects FX rates of EUR/USD 1.07, GBP/USD 1.21 and
CHF/USD 1.08.
(ii)
Including amounts held under separately
managed accounts (SMAs).
Q2 Operating Company Highlights
Sunrise (Consolidated)
Strong mobile performance, while headwinds in fixed continue;
Reiterating all 2023 financial guidance
Operating highlights: Continued
momentum in mobile delivering strong postpaid net adds in the
quarter of 23,100. As anticipated, broadband net adds softened this
quarter on the back of reduced promotional intensity in the main
brand and a slight increase in churn, which resulted in a modest Q2
contraction of 2,800 customers. Additionally, we announced a price
adjustment of ~4% in May. FMC penetration remains high at 58%
across Sunrise's broadband base.
Financial highlights: Revenue of
$816.2 million in Q2 2023 increased 6.5% YoY on a reported basis
and decreased 1.0% on a rebased5 basis. The rebased decrease was
largely driven by a decrease in fixed subscription revenue due to
ARPU pressure on main brand offerings that was only partially
offset by strong trading momentum in flanker brands. Adjusted
EBITDA increased 7.6% YoY on a reported basis and decreased 0.1% on
a rebased basis to $287.1 million in Q2 2023, including $3 million
of costs to capture6. The rebased decrease was mainly due to the
decline in revenue, partially offset by lower costs to capture and
labor spend. Adjusted EBITDA less P&E Additions of $164.7
million in Q2 increased 10.2% YoY on a reported basis and 2.9% on a
rebased basis, including $14 million of opex and capex costs to
capture.
Telenet (Consolidated)
Telenet formally launched new NetCo as Wyre and started
building in July
Operating highlights: Telenet lost
5,400 mobile postpaid RGUs in Q2, and its broadband base contracted
by 5,000 net adds, reflecting the June price adjustment, a
temporary system issue during the migration of customers to its new
IT platform and an intense competitive environment. Both video and
fixed-line telephony net adds continued to decline, mainly driven
by macroeconomic trends and shifting consumer preferences.
Meanwhile in May, the European Commission approved the
Telenet-Fluvius agreement to build Belgium's network of the future.
This new infrastructure company, Wyre, started building early July
and will allow the joint venture to deploy fiber-to-the-home (FTTH)
across Flanders over time.
Financial highlights: Revenue of
$767.0 million in Q2 2023 increased 11.3% YoY on a reported basis
and 1.0% on a rebased basis. The increase in rebased revenue was
primarily driven by (i) higher subscription revenue and (ii) an
increase in B2B revenue. Adjusted EBITDA increased 5.4% on a
reported basis and 5.0% on a rebased basis to $346.0 million in Q2.
The increase was driven by an $11.2 million decrease in costs
associated with the one-time benefit from expected settlements of
certain operational contingencies, as contemplated in Telenet's
guidance. Reported and rebased Adjusted EBITDA less P&E
Additions increased 1.5% and 3.4%, respectively, to $184.0 million
in Q2.
VMO2 (Non-consolidated Joint Venture)
VMO2 laid strong foundations in the first half of 2023 and
continue to focus on building commercial momentum, realizing
synergies of the JV and future proofing its networks
Operating highlights: VMO2 remains
focused on meeting customer needs and increasing convergence. The
fixed customer base contracted by 24,700 net adds in Q2, with an
increase in disconnections due to the implementation of price rises
over April and May. Broadband performance was more resilient with a
15,300 net reduction in Q2, while the average download speed across
the company's broadband base increased 34% YoY to 332Mbps,
approximately 5x higher than the national average. During Q2, VMO2
built 175,500 premises, the majority of which were FTTH built for
the nexfibre JV. In mobile, VMO2's 5G connectivity expanded to more
than 2,800 towns and cities and remains on track to deliver 5G
services to more than 50% of the entire U.K. population this
year.
Financial highlights (in U.S.
GAAP)7: Revenue8 of $3,391.5 million in Q2 2023 increased
5.9% YoY on a reported basis and 1.0% YoY on a rebased basis,
primarily due to the net effect of (i) an increase in mobile
revenue driven by consumer price rises and (ii) a decrease in
consumer fixed revenue, with each revenue category as defined and
reported by the VMO2 JV. Adjusted EBITDA8 increased 7.5% YoY on a
reported basis and 2.6% YoY on a rebased basis to $1,138.8 million,
including $19 million of opex costs to capture, primarily due to
the realization of synergies and implementation of price rises,
partially offset by higher energy costs. Adjusted EBITDA less
P&E Additions7 increased 26.5% YoY on a reported basis and
decreased 17.6% YoY on a rebased basis to $468.0 million, including
$56 million of opex and capex costs to capture.
For more information regarding the VMO2 JV, including full IFRS
disclosures, please visit its investor relations page to access the
Q2 earnings release.
VodafoneZiggo (Non-consolidated Joint Venture)
Commercial momentum in mobile and convergence
continued
Operating highlights: VodafoneZiggo
continues to improve its commercial momentum, as FMC households9
grew by 9,000 in Q2 to over 1.5 million households in total, and
FMC SIMs increased by 11,500 in Q2 to more than 2.6 million,
delivering significant Net Promoter Scores and customer loyalty
benefits. Mobile postpaid SIMs grew 37,500 to 5.2 million, while
mobile postpaid ARPU declined 0.7% YoY, primarily driven by ARPU
decline in B2B. Total internet RGUs declined by 31,000 in the
quarter, as a 35,400 decline in Consumer RGUs was only partially
offset by a 4,400 increase in B2B RGUs. Fixed ARPU remained stable
YoY.
Financial highlights: Revenue
increased 2.1% YoY on a reported basis and decreased 0.2% YoY on a
rebased basis to $1,088.4 million in Q2. The relatively flat
rebased result was primarily driven by a decline in the B2C fixed
customer base, partially offset by growth in mobile postpaid and
B2B fixed. Adjusted EBITDA decreased 1.2% on a reported basis and
3.6% on a rebased basis to $484.9 million in Q2, primarily driven
by higher energy and wage costs related to inflation. Reported and
rebased Adjusted EBITDA less P&E Additions decreased 4.4% and
7.1%, respectively, to $228.3 million in Q2.
Q2 ESG Highlights
Our Environmental, Social and Governance (ESG) agenda maintained
strong momentum in the second quarter, which included the
introduction of our new People Planet Progress strategy. The new
strategy sets out our company’s priorities and plans to address the
most important issues facing society and our environment today –
building on the progress we have made over the years, and deepening
our focus on the areas we aim to impact most.
In People, we champion diversity, equity and our culture of
Belonging. We are committed to enhancing digital equity and skills
and engaging with our communities to create positive change for the
generations to come. In Planet, we are working to reduce our
environmental footprint, innovating for circularity and energy
efficiency across our products and networks, and enabling
industries beyond our own to become greener through digitization.
In Progress, we commit to being a transparent and trusted company
with fair and sustainable practices, throughout our organization
and value chain. We are setting ambitious, multi-year goals to
direct our roadmap and demonstrate the progress we make across our
priorities.
We are also launching our Corporate Responsibility Report for
2022, which highlights our progress over the last year across our
agenda. A few of our key achievements include:
- Supported 20 active Employee Resource Groups across Liberty
Global Group;
- Volunteered nearly 9,300 hours across the Liberty Global Group
and achieved over 42% volunteering rate at Liberty Global
Netherlands, U.K., and U.S.;
- Reduced Scope 1 & 2 emissions by 25% since our base year of
2019 and are on track to achieve our science-based reduction target
of 50% by 2030 as well as our ambition to be Scope 1 & 2 carbon
neutral before then;
- Reduced transport-related CO2 emissions by 85% and avoided 135
tons of virgin plastic for our Apollo box alone;
- Established a People Planet Progress Committee, establishing
board level governance for strategic ESG matters;
- Conducted in-depth internal reviews and our first double
materiality assessment to identify the most material issues to help
shape our new strategy;
- Conducted the company’s first climate risk assessment, in
alignment with TCFD (Task force for climate-related financial
disclosures).
Liberty Global Consolidated Q2 Highlights
- Q2 revenue increased 5.3% YoY on a reported basis and decreased
0.6% on a rebased basis to $1,848.0 million
- Q2 earnings (loss) from continuing operations decreased 122.4%
YoY on a reported basis to ($511.3 million)
- Q2 Adjusted EBITDA decreased 7.4% YoY on a reported basis and
7.6% on a rebased basis to $601.4 million
- Q2 property & equipment additions were 19.1% of revenue, as
compared to 19.2% in Q2 2022
- Balance sheet with $5.5 billion of total liquidity
- Comprised of $1.6 billion of cash, $2.3 billion of investments
held under SMAs and $1.6 billion of unused borrowing
capacity10
- Blended, fully-swapped borrowing cost of 3.2% on a debt balance
of $15.3 billion
Liberty Global
Q2 2023
Q2 2022
YoY Change (reported)
YoY Change (rebased)
YTD 2023
YoY Change (reported)
YoY Change (rebased)
Customers
Organic customer net losses
(29,300
)
(19,900
)
(47.2
%)
(45,800
)
(92.4
%)
Financial
(in millions, except percentages)
Revenue(i)
$
1,848.0
$
1,754.2
5.3
%
(0.6
%)
$
3,716.4
3.0
%
0.2
%
Earnings (loss) from continuing
operations(i)
$
(511.3
)
$
2,282.2
(122.4
%)
$
(1,224.8
)
(136.5
%)
Adjusted EBITDA(i)
$
601.4
$
649.8
(7.4
%)
(7.6
%)
$
1,225.9
(8.1
%)
(6.8
%)
P&E additions(i)
$
352.7
$
336.0
5.0
%
$
742.6
3.4
%
Adjusted EBITDA less P&E
Additions(i)
$
248.7
$
313.8
(20.7
%)
(16.8
%)
$
483.3
(21.6
%)
(18.0
%)
Cash provided by operating activities
$
691.8
$
757.4
(8.7
%)
$
999.6
(26.7
%)
Cash provided (used) by investing
activities
$
(63.1
)
$
2,620.7
(102.4
%)
$
(1,486.3
)
(157.6
%)
Cash provided (used) by financing
activities
$
(518.8
)
$
(1,776.3
)
70.8
%
$
295.0
112.1
%
Full Company11 Adjusted FCF
$
328.7
$
427.0
(23.0
%)
$
150.3
(73.4
%)
Full Company Distributable Cash Flow
$
533.9
$
427.0
25.0
%
$
553.8
(1.8
%)
______________________
(i)
2023 amounts are impacted by the strategic
and operational changes to our Central T&I function during Q2
as discussed in footnote (ii) to the revenue table in our P&L
Discussion below.
Customer Growth
Three months ended
Six months ended
June 30,
June 30,
2023
2022
2023
2022
Organic customer net losses by
market
Switzerland
(8,100
)
(9,000
)
(5,800
)
(3,600
)
Belgium
(12,800
)
(4,400
)
(26,100
)
(9,900
)
Ireland
(6,800
)
(4,500
)
(9,300
)
(5,900
)
Slovakia
(1,300
)
(2,000
)
(2,500
)
(4,400
)
Luxembourg(i)
(300
)
—
(2,100
)
—
Total
(29,300
)
(19,900
)
(45,800
)
(23,800
)
______________________
(i)
The 2023 amounts relate to our business in
Luxembourg as a result of Telenet's January 2023 acquisition of
Eltrona.
Earnings (Loss) from Continuing Operations
Earnings (loss) from continuing operations was ($511.3 million)
and $2,282.2 million for the three months ended June 30, 2023 and
2022, respectively, and ($1,224.8 million) and $3,357.9 million for
the six months ended June 30, 2023 and 2022, respectively.
Financial Highlights
The following tables present (i) Revenue, Adjusted EBITDA and
Adjusted EBITDA less P&E Additions for each of our reportable
segments, including the non-consolidated VMO2 JV and VodafoneZiggo
JV, for the comparative periods and (ii) the percentage change from
period to period on both a reported and rebased basis. During the
first quarter of 2023, we changed the terms related to, and
approach to how we reflect the allocation of, charges for certain
products and services that our centrally-managed technology and
innovation function provides to our consolidated reportable
segments (the Tech Framework). For additional information, see the
Appendix. Consolidated Adjusted EBITDA and Consolidated Adjusted
EBITDA less P&E Additions are non-GAAP measures. For additional
information on how these measures are defined and why we believe
they are meaningful, see the Glossary.
Three months ended
Increase/(decrease)
Six months ended
Increase/(decrease)
June 30,
June 30,
Revenue
2023
2022(i)
Reported %
Rebased %
2023
2022(i)
Reported %
Rebased %
in millions, except %
amounts
Switzerland
$
816.2
$
766.1
6.5
(1.0
)
$
1,623.6
$
1,587.5
2.3
(1.3
)
Belgium
767.0
689.1
11.3
1.0
1,521.5
1,413.5
7.6
1.9
Ireland
123.9
121.5
2.0
(0.4
)
246.9
249.3
(1.0
)
0.2
Central and Other(ii)
206.2
240.5
(14.3
)
(4.6
)
450.7
481.9
(6.5
)
0.7
Intersegment eliminations(iii)
(65.3
)
(63.0
)
N.M.
N.M.
(126.3
)
(124.7
)
N.M.
N.M.
Total
$
1,848.0
$
1,754.2
5.3
(0.6
)
$
3,716.4
$
3,607.5
3.0
0.2
VMO2 JV(iv)
$
3,391.5
$
3,202.6
5.9
1.0
$
6,554.2
$
6,600.6
(0.7
)
0.4
VodafoneZiggo JV(iv)
$
1,088.4
$
1,065.6
2.1
(0.2
)
$
2,171.8
$
2,195.6
(1.1
)
0.1
______________________
N.M. - Not Meaningful
(i)
Amounts have been revised, as applicable,
to reflect the retrospective impact of the Tech Framework, as
described above and in the Appendix.
(ii)
As further described in note 16 to our
June 30, 2023 10-Q, as a result of our determination to market, and
plan to sell, third-party licenses related to certain of our
internally-developed software, from May 2023, we recorded proceeds
from the licensing and related sale of products from this
internally-developed software (including proceeds generated from
our arrangements with the VMO2 JV and the VodafoneZiggo JV) against
the net book value of our existing internally-developed capitalized
software and will continue to do so until that balance is reduced
to zero. Accordingly, during the three and six months ended June
30, 2023, Revenue, Adjusted EBITDA and Adjusted EBITDA less P&E
Additions exclude the benefit of $30.7 million that otherwise would
have been reported in such metrics impacting both our consolidated
and Central and Other Revenue, Adjusted EBITDA and Adjusted EBITDA
less P&E Additions. As a result, Adjusted EBITDA and Adjusted
EBITDA less P&E Additions are comparatively lower in the
current period, however, Adjusted FCF is largely unaffected. We
will resume recognizing revenue for such licensing and related sale
of products once the balance of our internally-developed and
capitalized software has been reduced to zero. Further, we now
expense the costs of development of such software due to the fact
that we plan to externally market to third parties.
(iii)
Amounts primarily relate to (i) the
revenue recognized within our T&I Function related to the Tech
Framework and (ii) for the 2022 YTD period, transactions between
our continuing and discontinued operations.
(iv)
Amounts reflect 100% of the 50:50
non-consolidated VMO2 JV and VodafoneZiggo JV's revenue.
Three months ended
Increase/(decrease)
Six months ended
Increase/(decrease)
June 30,
June 30,
Adjusted EBITDA
2023
2022(i)
Reported %
Rebased %
2023
2022(i)
Reported %
Rebased %
in millions, except %
amounts
Switzerland
$
287.1
$
266.7
7.6
(0.1
)
$
550.1
$
557.5
(1.3
)
(4.7
)
Belgium
346.0
328.2
5.4
5.0
648.9
666.3
(2.6
)
0.6
Ireland
47.3
48.5
(2.5
)
(4.4
)
88.8
95.6
(7.1
)
(6.1
)
Central and Other(ii)
(63.8
)
21.3
N.M.
N.M.
(31.7
)
46.1
N.M.
N.M.
Intersegment eliminations(iii)
(15.2
)
(14.9
)
N.M.
N.M.
(30.2
)
(31.4
)
N.M.
N.M.
Total
$
601.4
$
649.8
(7.4
)
(7.6
)
$
1,225.9
$
1,334.1
(8.1
)
(6.8
)
VMO2 JV(iv)
$
1,138.8
$
1,059.4
7.5
2.6
$
2,164.7
$
2,454.7
(11.8
)
2.3
VodafoneZiggo JV(iv)
$
484.9
$
490.9
(1.2
)
(3.6
)
$
956.4
$
1,028.7
(7.0
)
(5.9
)
______________________
N.M. - Not Meaningful
(i)
Amounts have been revised, as applicable,
to reflect the retrospective impact of the Tech Framework, as
described above and in the Appendix.
(ii)
2023 amounts are impacted by the strategic
and operational changes to our Central T&I function during Q2
as discussed in footnote (ii) to the revenue table above.
(iii)
Amounts relate to (i) the Adjusted EBITDA
impact to Central and Other of the value attributed to
centrally-held internally developed technology that is embedded
within our various CPE, as well as any applicable markup, and (ii)
for the YTD 2022 period, transactions between our continuing and
discontinued operations.
(iv)
Amounts reflect 100% of the 50:50
non-consolidated VMO2 JV and VodafoneZiggo JV's Adjusted
EBITDA.
Three months ended
Increase/(decrease)
Six months ended
Decrease
Adjusted EBITDA less
P&E Additions
June 30,
June 30,
2023
2022(i)
Reported %
Rebased %
2023
2022(i)
Reported %
Rebased %
in millions, except %
amounts
Switzerland
$
164.7
$
149.5
10.2
2.9
$
278.7
$
291.0
(4.2
)
(7.1
)
Belgium
184.0
181.2
1.5
3.4
313.9
360.8
(13.0
)
(7.8
)
Ireland
(4.2
)
22.3
(118.8
)
(118.3
)
4.2
40.2
(89.6
)
(89.2
)
Central and Other(ii)
(95.8
)
(39.2
)
(144.4
)
(51.3
)
(113.5
)
(75.0
)
(51.3
)
(22.7
)
Intersegment eliminations
—
—
N.M.
N.M.
—
(0.8
)
N.M.
N.M.
Total
$
248.7
$
313.8
(20.7
)
(16.8
)
$
483.3
$
616.2
(21.6
)
(18.0
)
VMO2 JV(iii)
$
468.0
$
370.1
26.5
(17.6
)
$
903.3
$
1,106.1
(18.3
)
(16.8
)
VodafoneZiggo JV(iii)
$
228.3
$
238.8
(4.4
)
(7.1
)
$
449.4
$
556.2
(19.2
)
(18.2
)
______________________
N.M. - Not Meaningful
(i)
Amounts have been revised, as applicable,
to reflect the retrospective impact of the Tech Framework, as
described above and in the Appendix.
(ii)
2023 amounts are impacted by the strategic
and operational changes to our Central T&I function during Q2
as discussed in footnote (ii) to the revenue table above.
(iii)
Amounts reflect 100% of the 50:50
non-consolidated VMO2 JV and VodafoneZiggo JV's Adjusted EBITDA
less P&E Additions.
Leverage and Liquidity
- Total principal amount of debt and
finance leases: $15.3 billion
- Average debt tenor12: 5.4 years,
with ~51% not due until 2029 or thereafter
- Borrowing costs: Blended,
fully-swapped cost of debt was 3.2%
- Liquidity: $5.5 billion, including
(i) $1.6 billion of cash at June 30, 2023, (ii) $2.3 billion of
investments held under SMAs and (iii) $1.6 billion of aggregate
unused borrowing capacity under our credit facilities
Forward-Looking Statements and Disclaimer
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, including statements with respect to our strategies, future
growth prospects and opportunities; expectations regarding our and
our businesses' financial performance, including Revenue and
Rebased Revenue, Adjusted EBITDA, Adjusted EBITDA less P&E
Additions, Adjusted Free Cash Flow and Distributable Cash Flow, as
well as the 2023 financial guidance provided by us and our
operating companies and joint ventures; expectations of any
macroeconomic dynamics that may be beneficial or detrimental to the
company; expectations with respect to the integration and synergy
plans at Virgin Media O2, including the timing, costs and
anticipated benefits thereof; our and our affiliates' plans with
respect to network products and services, including with respect to
5G; our intention to repurchase all the outstanding shares of
Telenet that we do not already own, including the timing of the
reopening of the tender offer and announcement of its results, the
purchase price and the potential benefits to be derived therefrom;
our proposed redomiciliation from the U.K. to Bermuda, including
the timing and anticipated benefits resulting from such a move, as
well as any impacts on, and the location of, our operations; our
anticipated pricing adjustments in our various markets and the
effect that such adjustments will have on our operational and
financial results; our commitments and aspirations with respect to
ESG, including our efforts to purchase renewable energy, reduce
e-waste, pursue social impact opportunities and execute on our
DE&I agenda; our share buyback program, and the anticipated
number of shares to be repurchased in 2023, as well as the
additional authorization for additional repurchases from our board
of directors; our anticipated investments in our infrastructure and
networks; the strength of our and our affiliates' respective
balance sheets (including cash and liquidity position); the tenor
and cost of our third-party debt and anticipated borrowing
capacity; anticipated distributions to be received from our
subsidiaries and joint ventures and other information and
statements that are not historical fact. These forward-looking
statements involve certain risks and uncertainties that could cause
actual results to differ materially from those expressed or implied
by these statements. These risks and uncertainties include events
that are outside of our control, such as the continued use by
subscribers and potential subscribers of our and our affiliates’
and joint ventures' services and their willingness to upgrade to
our more advanced offerings; our and our affiliates’ ability to
meet challenges from competition, to manage rapid technological
change or to maintain or increase rates to subscribers or to pass
through increased costs to subscribers; the potential impact of
pandemics and epidemics on us and our businesses as well as our
customers; the effects of changes in laws or regulations; the
effects of the U.K.'s exit from the E.U.; general economic factors;
our, our affiliates’ and our joint ventures' ability to obtain
regulatory approval and satisfy regulatory conditions associated
with acquisitions and dispositions; our, our affiliates’ and our
joint ventures' ability to successfully acquire and integrate new
businesses and realize anticipated efficiencies from acquired
businesses; the availability of attractive programming for our, our
affiliates’ and our joint ventures' video services and the costs
associated with such programming; our, our affiliates’ and our
joint ventures' ability to achieve forecasted financial and
operating targets; the outcome of any pending or threatened
litigation; the ability of our operating companies and affiliates
and joint ventures to access the cash of their respective
subsidiaries; the impact of our operating companies', affiliates’
and joint ventures' future financial performance, or market
conditions generally, on the availability, terms and deployment of
capital; fluctuations in currency exchange and interest rates; the
ability of suppliers, vendors and contractors to timely deliver
quality products, equipment, software, services and access; our,
our affiliates’ and our joint ventures' ability to adequately
forecast and plan future network requirements including the costs
and benefits associated with network expansions; and other factors
detailed from time to time in our filings with the Securities and
Exchange Commission (the "SEC"), including our most recently filed
Form 10-K, Form 10-K/A and Form 10-Qs. These forward-looking
statements speak only as of the date of this release. We expressly
disclaim any obligation or undertaking to disseminate any updates
or revisions to any forward-looking statement contained herein to
reflect any change in our expectations with regard thereto or any
change in events, conditions or circumstances on which any such
statement is based.
Share Repurchase Program
We previously announced that our Board of Directors authorized a
share repurchase program whereby we have committed to repurchasing
10% of our outstanding shares in 2023. In addition, as announced
today, our Board of Directors authorized an increase in our 2023
share repurchase program to a minimum of at least 15% of our total
number of outstanding shares as of December 31, 2022. Under the
program, Liberty Global may acquire from time to time its Class A
ordinary shares, Class C ordinary shares, or any combination of
Class A and Class C ordinary shares. The program may be effected
through open market transactions and/or privately negotiated
transactions, which may include derivative transactions. The timing
of the repurchase of shares pursuant to the program will depend on
a variety of factors, including market conditions and applicable
law. The program may be implemented in conjunction with brokers for
the Company and other financial institutions with whom the Company
has relationships within certain pre-set parameters, and purchases
may continue during closed periods in accordance with applicable
restrictions. The program may be suspended or discontinued at any
time and will terminate upon repurchasing the authorized limits
unless further repurchase authorization is provided for.
About Liberty Global
Liberty Global (NASDAQ: LBTYA, LBTYB and LBTYK) is a world
leader in converged broadband, video and mobile communications
services. We deliver next-generation products through advanced
fiber and 5G networks, and currently provide over 85 million
connections* across Europe and the United Kingdom. Our businesses
operate under some of the best-known consumer brands, including
Virgin Media-O2 in the U.K., VodafoneZiggo in The Netherlands,
Telenet in Belgium, Sunrise in Switzerland, Virgin Media in Ireland
and UPC in Slovakia. Through our substantial scale and commitment
to innovation, we are building Tomorrow’s Connections Today,
investing in the infrastructure and platforms that empower our
customers to make the most of the digital revolution, while
deploying the advanced technologies that nations and economies need
to thrive.
Our consolidated businesses generate annual revenue of more than
$7 billion, while the VMO2 JV and VodafoneZiggo JV generate
combined annual revenue of more than $17 billion.**
Liberty Global Ventures, our global investment arm, has a
portfolio of more than 75 companies across content, technology and
infrastructure, including strategic stakes in companies like ITV,
Televisa Univision, Plume, AtlasEdge and the Formula E racing
series.
* Represents aggregate consolidated and 50% owned
non-consolidated fixed and mobile subscribers. Includes wholesale
mobile connections of the VMO2 JV and B2B fixed subscribers of the
VodafoneZiggo JV.
** Revenue figures above are provided based on full year 2022
Liberty Global consolidated results (excluding revenue from Poland)
and the combined as reported full year 2022 results for the
VodafoneZiggo JV and full year 2022 U.S. GAAP results for the VMO2
JV. For more information, please visit www.libertyglobal.com.
Balance Sheets, Statements of Operations and Statements of
Cash Flows
The condensed consolidated balance sheets, statements of
operations and statements of cash flows of Liberty Global are in
our 10-Q.
Rebase Information
Rebase growth percentages, which are non-GAAP measures, are
presented as a basis for assessing growth rates on a comparable
basis. For purposes of calculating rebase growth rates on a
comparable basis for all businesses that we owned during 2023, we
have adjusted our historical revenue, Adjusted EBITDA and Adjusted
EBITDA less P&E Additions for the three and six months ended
June 30, 2022 to (i) include the pre-acquisition revenue, Adjusted
EBITDA and P&E additions to the same extent these entities are
included in our results for the three and six months ended June 30,
2023, (ii) exclude from our rebased amounts the revenue, Adjusted
EBITDA and P&E additions of entities disposed of to the same
extent these entities are excluded in our results for the three and
six months ended June 30, 2023, (iii) include in our rebased
amounts the revenue and costs for the temporary elements of
transitional and other services provided to iliad, Vodafone,
Deutsche Telekom and M7 Group, to reflect amounts related to these
services equal to those included in our results for the three and
six months ended June 30, 2023 and (iv) reflect the translation of
our rebased amounts at the applicable average foreign currency
exchange rates that were used to translate our results for the
three and six months ended June 30, 2023. We have reflected the
revenue, Adjusted EBITDA and P&E additions of these acquired
entities in our 2022 rebased amounts based on what we believe to be
the most reliable information that is currently available to us
(generally pre-acquisition financial statements), as adjusted for
the estimated effects of (a) any significant differences between
U.S. GAAP and local generally accepted accounting principles, (b)
any significant effects of acquisition accounting adjustments, (c)
any significant differences between our accounting policies and
those of the acquired entities and (d) other items we deem
appropriate. We do not adjust pre-acquisition periods to eliminate
nonrecurring items or to give retroactive effect to any changes in
estimates that might be implemented during post-acquisition
periods. As we did not own or operate the acquired businesses
during the pre-acquisition periods, no assurance can be given that
we have identified all adjustments necessary to present the
revenue, Adjusted EBITDA and Adjusted EBITDA less P&E Additions
of these entities on a basis that is comparable to the
corresponding post-acquisition amounts that are included in our
results or that the pre-acquisition financial statements we have
relied upon do not contain undetected errors. In addition, the
rebase growth percentages are not necessarily indicative of the
revenue, Adjusted EBITDA and Adjusted EBITDA less P&E Additions
that would have occurred if these transactions had occurred on the
dates assumed for purposes of calculating our rebased amounts or
the revenue, Adjusted EBITDA and Adjusted EBITDA less P&E
Additions that will occur in the future. Investors should view
rebase growth as a supplement to, and not a substitute for, U.S.
GAAP measures of performance included in our condensed consolidated
statements of operations.
The following table provides adjustments made to the 2022
amounts (i) in aggregate for our consolidated reportable segments
and (ii) for the non-consolidated VMO2 JV and VodafoneZiggo JV to
derive our rebased growth rates:
Three months ended June 30,
2022
Six months ended June 30,
2022
Revenue
Adjusted EBITDA
Adjusted EBITDA less P&E
Additions
Revenue
Adjusted EBITDA
Adjusted EBITDA less P&E
Additions
in millions
Consolidated Liberty Global:
Acquisitions and dispositions(i)
$
26.6
$
(29.6
)
$
(32.0
)
$
71.2
$
(32.0
)
$
(37.3
)
Foreign currency
78.1
30.5
17.0
29.9
13.4
10.2
Total
$
104.7
$
0.9
$
(15.0
)
$
101.1
$
(18.6
)
$
(27.1
)
VMO2 JV(ii):
Acquisitions and dispositions(iii)
$
7.6
$
(10.6
)
$
(10.6
)
$
(26.7
)
$
(259.8
)
$
(259.8
)
nexfibre construction revenue(iv)
165.8
18.4
18.4
288.2
30.8
30.8
nexfibre construction P&E
additions(iv)
—
—
147.7
—
—
257.3
Foreign currency
(16.5
)
42.3
42.7
(333.1
)
(110.5
)
(48.1
)
Total
$
156.9
$
50.1
$
198.2
$
(71.6
)
$
(339.5
)
$
(19.8
)
VodafoneZiggo JV(ii):
Foreign currency
$
24.5
$
11.9
$
6.9
$
(24.9
)
$
(11.8
)
$
(6.5
)
______________________
(i)
In addition to our acquisitions and
dispositions, these rebase adjustments include amounts related to
agreements to provide transitional and other services to iliad,
Vodafone, Deutsche Telekom and M7 Group. These adjustments result
in an equal amount of fees in both the 2023 and 2022 periods for
those services that are deemed to be temporary in nature.
(ii)
Amounts reflect 100% of the adjustments
made related to the VMO2 JV's and the VodafoneZiggo JV's revenue,
Adjusted EBITDA and Adjusted EBITDA less P&E Additions, which
we do not consolidate, as we hold a 50% noncontrolling interest in
the VMO2 JV and the VodafoneZiggo JV.
(iii)
Amounts for the YTD period relate to the
exclusion of certain handset securitization transactions in Q1
2022, including approximately £32 million ($44 million at the
applicable rate) of revenue and £174 million ($233 million at the
applicable rate) of Adjusted EBITDA related to restructuring of the
legacy O2 securitization structure.
(iv)
Amounts relate to the VMO2 JV's
construction agreement with the nexfibre JV. Amounts exclude
adjustments for other service-related benefits attributable to the
overall agreement between the VMO2 JV and the nexfibre JV.
Liquidity
The following table(i) details the U.S. dollar equivalents of
our liquidity position at June 30, 2023, which includes our (i)
cash and cash equivalents, (ii) investments held under SMAs and
(iii) unused borrowing capacity:
Cash
Unused
and Cash
Borrowing
Total
Equivalents
SMAs(ii)
Capacity(iii)
Liquidity
in millions
Liberty Global and unrestricted
subsidiaries
$
438.3
$
2,293.4
$
—
$
2,731.7
Telenet
1,110.5
—
704.2
1,814.7
UPC Holding
16.1
—
778.9
795.0
VM Ireland
0.3
—
109.2
109.5
Total
$
1,565.2
$
2,293.4
$
1,592.3
$
5,450.9
______________________
(i)
Except as otherwise indicated, the amounts
reported in the table include the named entity and its
subsidiaries.
(ii)
Represents investments held under SMAs
which are maintained by investment managers acting as agents on our
behalf.
(iii)
Our aggregate unused borrowing capacity of
$1.6 billion represents maximum undrawn commitments under the
applicable facilities without regard to covenant compliance
calculations or other conditions precedent to borrowing.
Summary of Debt & Finance Lease Obligations
The following table(i) details the June 30, 2023 U.S. dollar
equivalents of the (i) outstanding principal amounts of our debt
and finance lease obligations, (ii) expected principal-related
derivative cash payments or receipts and (iii) swapped principal
amounts of our debt and finance lease obligations:
Finance
Total Debt
Principal Related
Swapped Debt
Lease
& Finance Lease
Derivative
& Finance Lease
Debt(ii)
Obligations
Obligations
Cash Payments
Obligations
in millions
UPC Holding
$
6,363.7
$
20.9
$
6,384.6
$
377.4
$
6,762.0
Telenet
6,046.5
404.5
6,451.0
(102.0
)
6,349.0
VM Ireland
982.7
—
982.7
—
982.7
Other(iii)
1,408.4
34.1
1,442.5
—
1,442.5
Total
$
14,801.3
$
459.5
$
15,260.8
$
275.4
$
15,536.2
______________________
(i)
Except as otherwise indicated, the amounts
reported in the table include the named entity and its
subsidiaries.
(ii)
Debt amounts for UPC Holding include notes
issued by special purpose entities that are consolidated by UPC
Holding.
(iii)
Debt amount includes a loan of $1,373.6
million backed by the shares we hold in Vodafone Group plc.
Property and Equipment Additions and Capital
Expenditures
The table below highlights the categories of property and
equipment additions of our continuing operations for the indicated
periods and reconciles those additions to the capital expenditures
of our continuing operations that are presented in the condensed
consolidated statements of cash flows in our 10-Q.
Three months ended
Six months ended
June 30,
June 30,
2023
2022
2023
2022
in millions, except %
amounts
Customer premises equipment
$
70.7
$
64.7
$
140.0
$
135.9
New build & upgrade
53.7
27.6
81.8
50.4
Capacity
38.5
46.9
94.5
90.7
Baseline
96.8
91.8
233.8
226.6
Product & enablers
93.0
105.0
192.5
214.3
Total P&E additions
352.7
336.0
742.6
717.9
Reconciliation of P&E additions to
capital expenditures:
Assets acquired under capital-related
vendor financing arrangements(i)
(56.0
)
(35.5
)
(98.3
)
(102.2
)
Assets acquired under finance leases
(9.6
)
(9.3
)
(16.9
)
(18.0
)
Changes in current liabilities related to
capital expenditures
24.1
(29.8
)
61.0
36.5
Total capital expenditures, net(ii)
$
311.2
$
261.4
$
688.4
$
634.2
P&E additions as % of revenue
19.1
%
19.2
%
20.0
%
19.9
%
______________________
(i)
Amounts exclude related VAT of $3.2
million and $3.2 million for the three months ended June 30, 2023
and 2022, respectively, and $9.9 million and $9.8 million for the
six months ended June 30, 2023 and 2022, respectively, that were
also financed under these arrangements.
(ii)
The capital expenditures that we report in
our condensed consolidated statements of cash flows do not include
amounts that are financed under vendor financing or finance lease
arrangements. Instead, these expenditures are reflected as non-cash
additions to our property and equipment when the underlying assets
are delivered, and as repayments of debt when the related principal
is repaid.
ARPU per Fixed Customer Relationship
The following table provides ARPU per fixed customer
relationship and percentage change from period to period on both a
reported and rebased basis for the indicated periods:
ARPU per Fixed Customer
Relationship
Three months ended June
30,
Increase/(decrease)
2023
2022
Reported %
Rebased %
Liberty Global
$
64.80
$
62.80
3.2
%
(0.4
%)
Ireland
€
61.68
€
60.62
1.7
%
1.8
%
Belgium (Telenet)
€
59.24
€
58.40
1.4
%
2.3
%
UPC Holding
€
59.28
€
59.28
—
%
(4.0
%)
Mobile ARPU
The following tables provide ARPU per mobile subscriber and
percentage change from period to period on both a reported and
rebased basis for the indicated periods:
ARPU per Mobile
Subscriber
Three months ended June
30,
Increase/(decrease)
2023
2022
Reported %
Rebased %
Liberty Global:
Including interconnect revenue
$
26.96
$
25.77
4.6
%
(0.8
%)
Excluding interconnect revenue
$
25.10
$
23.41
7.2
%
1.5
%
Operating Data — June 30,
2023
Homes
Passed
Fixed-Line Customer
Relationships
Internet
Subscribers(i)
Video
Subscribers (ii)
Telephony
Subscribers(iii)
Total
RGUs
Postpaid Mobile
Subscribers
Total Mobile
Subscribers(iv)
Consolidated Liberty Global:
Switzerland(v)
2,686,900
1,491,300
1,187,800
1,229,900
972,800
3,390,500
2,385,400
2,803,400
Belgium
3,449,900
1,991,600
1,732,200
1,664,700
972,100
4,369,000
2,677,000
2,929,200
Ireland
970,200
411,800
375,600
242,400
236,600
854,600
139,800
139,800
Slovakia
639,500
179,900
145,600
163,200
88,400
397,200
—
—
Luxembourg(vi)
148,700
49,600
16,900
43,400
8,800
69,100
2,400
2,400
Total Liberty Global
7,895,200
4,124,200
3,458,100
3,343,600
2,278,700
9,080,400
5,204,600
5,874,800
VMO2 JV
16,184,500
5,791,700
5,667,300
12,837,900
16,053,300
34,525,900
VodafoneZiggo JV(vii)
7,375,300
3,638,800
3,267,500
3,611,500
1,658,900
8,537,900
5,232,900
5,570,400
Subscriber Variance Table —
June 30, 2023 vs. March 31, 2023
Homes
Passed
Fixed-Line Customer
Relationships
Internet
Subscribers(ii)
Video
Subscribers(i)
Telephony
Subscribers(iii)
Total
RGUs
Postpaid Mobile
Subscribers
Total Mobile
Subscribers(iv)
Organic Change
Summary
Consolidated Liberty Global:
Switzerland(v)
11,000
(8,100
)
(2,800
)
(9,700
)
(16,800
)
(29,300
)
23,100
12,800
Belgium
6,200
(12,800
)
(5,300
)
(19,300
)
(20,600
)
(45,200
)
(5,400
)
(13,800
)
Ireland
2,700
(6,800
)
(5,500
)
(9,400
)
(9,500
)
(24,400
)
(3,200
)
(3,200
)
Slovakia
900
(1,300
)
(500
)
(1,100
)
(500
)
(2,100
)
—
—
Luxembourg(vi)
2,200
(300
)
300
(400
)
300
200
—
—
Total Liberty Global
23,000
(29,300
)
(13,800
)
(39,900
)
(47,100
)
(100,800
)
14,500
(4,200
)
VMO2 JV
13,100
(24,700
)
(15,300
)
(165,600
)
(1,500
)
456,200
VodafoneZiggo JV(vii)
(4,800
)
(33,900
)
(31,000
)
(33,100
)
(51,400
)
(115,500
)
37,500
10,900
Q2 2023 Joint
Ventures Adjustments:
VMO2 JV
—
—
—
—
—
—
(11,900
)
(11,900
)
Total adjustments
—
—
—
—
—
—
(11,900
)
(11,900
)
Footnotes for Operating Data and Subscriber Variance
Tables
____________________
(i)
In Switzerland, we offer a 10 Mbps
internet service to our Video Subscribers without an incremental
recurring fee. Our Internet Subscribers in Switzerland include
approximately 44,400 subscribers who have requested and received
this service.
(ii)
We have approximately 30,900 “lifeline”
customers that are counted on a per connection basis, representing
the least expensive regulated tier of video service, with only a
few channels.
(iii)
In Switzerland, we offer a basic phone
service to our Video Subscribers without an incremental recurring
fee. Our Telephony Subscribers in Switzerland include approximately
164,500 subscribers who have requested and received this
service.
(iv)
In a number of countries, our mobile
subscribers receive mobile services pursuant to prepaid contracts.
As of June 30, 2023, our mobile subscriber count included
approximately 418,000, 252,200, 7,862,200 and 337,500 prepaid
mobile subscribers in Switzerland, Belgium, the VMO2 JV and the
VodafoneZiggo JV, respectively. Prepaid mobile customers are
excluded from the VMO2 JV's and the VodafoneZiggo JV's mobile
subscriber counts after a period of inactivity of three months and
nine months, respectively. The mobile subscriber count for the VMO2
JV includes IoT connections, which are Machine-to-Machine contract
mobile connections, including Smart Metering contract connections.
The mobile subscriber count presented above for the VMO2 JV
excludes wholesale mobile connections of approximately 9,429,700
that are included in the total mobile subscriber count as defined
and presented by the VMO2 JV.
(v)
Pursuant to service agreements,
Switzerland offers broadband internet, video and telephony services
over networks owned by third-party operators (“partner networks”),
and following the acquisition of Sunrise, also services homes
through Sunrise's existing agreements with Swisscom, Swiss Fibre
Net and local utilities. Under these agreements, RGUs are only
recognized if there is a direct billing relationship with the
customer. Homes passed or serviceable through the above service
agreements are not included in Switzerland's homes passed count as
we do not own these networks. Including these arrangements, our
operations in Switzerland have the ability to offer fixed services
to the national footprint.
(vi)
Relates to our business in Luxembourg as a
result of Telenet's January 2023 acquisition of Eltrona.
(vii)
Fixed subscriber counts for the
VodafoneZiggo JV include B2B subscribers.
Additional General Notes to
Tables:
Most of our broadband communications subsidiaries provide
broadband internet, telephony, data, video or other B2B services.
Certain of our B2B revenue is derived from SOHO subscribers that
pay a premium price to receive enhanced service levels along with
internet, video or telephony services that are the same or similar
to the mass marketed products offered to our residential
subscribers. All mass marketed products provided to SOHOs, whether
or not accompanied by enhanced service levels and/or premium
prices, are included in the respective RGU and customer counts of
our broadband communications operations, with only those services
provided at premium prices considered to be “SOHO RGUs” or “SOHO
customers”. To the extent our existing customers upgrade from a
residential product offering to a SOHO product offering, the number
of SOHO RGUs or SOHO customers will increase, but there is no
impact to our total RGU or customer counts. With the exception of
our B2B SOHO subscribers and mobile subscribers at medium and large
enterprises, we generally do not count customers of B2B services as
customers or RGUs for external reporting purposes.
In Belgium, Telenet leases a portion of its network under a
long-term finance lease arrangement. These tables include operating
statistics for Telenet's owned and leased networks.
While we take appropriate steps to ensure that subscriber
statistics are presented on a consistent and accurate basis at any
given balance sheet date, the variability from country to country
in (i) the nature and pricing of products and services, (ii) the
distribution platform, (iii) billing systems, (iv) bad debt
collection experience and (v) other factors add complexity to the
subscriber counting process. We periodically review our subscriber
counting policies and underlying systems to improve the accuracy
and consistency of the data reported on a prospective basis.
Accordingly, we may from time to time make appropriate adjustments
to our subscriber statistics based on those reviews.
Subscriber information for acquired entities is preliminary and
subject to adjustment until we have completed our review of such
information and determined that it is presented in accordance with
our policies.
Footnotes
1
Represents aggregate consolidated and 50%
owned non-consolidated VMO2 JV and VodafoneZiggo JV homes passed,
broadband subscribers and postpaid mobile subscribers, as
applicable. Aggregate subscribers also includes certain B2B fixed
subscribers of the VodafoneZiggo JV.
2
YTD represents stock repurchases through
July 21, 2023.
3
2023 Distributable Cash Flow guidance
reflects FX rates of EUR/USD 1.07, GBP/USD 1.21, CHF/USD 1.08.
4
Liquidity refers to cash and cash
equivalents and investments held under separately managed accounts
plus the maximum undrawn commitments under subsidiary borrowing
facilities, without regard to covenant compliance calculations or
other conditions precedent to borrowing.
5
The indicated growth rates are rebased for
acquisitions, dispositions, FX and other items that impact the
comparability of our year-over-year results. See Rebase Information
section for more information on rebased growth.
6
Costs to capture generally include
incremental, third-party operating and capital related costs that
are directly associated with integration activities, restructuring
activities and certain other costs associated with aligning an
acquiree to our business processes to derive synergies. These costs
are necessary to combine the operations of a business being
acquired (or joint venture being formed) with ours or are
incidental to the acquisition. As a result, costs to capture may
include certain (i) operating costs that are included in Adjusted
EBITDA, (ii) capital-related costs that are included in property
and equipment additions and Adjusted EBITDA less P&E Additions
and (iii) certain integration-related restructuring expenses that
are not included within Adjusted EBITDA or Adjusted EBITDA less
P&E Additions. Given the achievement of synergies occurs over
time, certain of our costs to capture are recurring by nature, and
generally incurred within a few years of completing the
transaction.
7
This release includes the actual U.S. GAAP
results for the VMO2 JV for the three and six months ended June 30,
2023 and 2022. The commentary and YoY growth rates presented in
this release are shown on a rebased basis. For more information
regarding the VMO2 JV, including full IFRS disclosures, please
visit their investor relations page to access the VMO2 JV's Q2
earnings release.
8
The U.S. GAAP YoY growth rates for the
VMO2 JV are impacted by rebase adjustments and recurring U.S. GAAP
to IFRS accounting differences, as further described and reconciled
below.
Three months ended June
30,
Six months ended June
30,
2023
2022
2023
2022
in millions
Revenue:
U.S. GAAP revenue
$
3,391.5
$
3,202.6
$
6,554.2
$
6,600.6
Rebase adjustments(i)
3.5
173.4
7.4
261.5
U.S. GAAP rebased revenue
3,395.0
3,376.0
6,561.6
6,862.1
U.S. GAAP/IFRS adjustments
—
—
—
—
IFRS rebased revenue
$
3,395.0
$
3,376.0
$
6,561.6
$
6,862.1
Adjusted EBITDA:
U.S. GAAP Adjusted EBITDA
$
1,138.8
$
1,059.4
$
2,164.7
$
2,454.7
Rebase adjustments(ii)
1.9
7.8
3.9
(229.0
)
U.S. GAAP rebased Adjusted EBITDA
1,140.7
1,067.2
2,168.6
2,225.7
U.S. GAAP/IFRS adjustments(iv)
108.7
152.3
210.5
243.9
IFRS rebased Adjusted EBITDA (including
costs to capture)
$
1,249.4
$
1,219.5
$
2,379.1
$
2,469.6
Property & equipment
additions:
U.S. GAAP P&E additions
$
670.8
$
689.3
$
1,261.4
$
1,348.6
Rebase adjustments(iii)
—
(147.7
)
—
(257.3
)
U.S. GAAP rebased P&E additions
670.8
541.6
1,261.4
1,091.3
U.S. GAAP/IFRS adjustments(iv)
53.3
46.0
112.4
109.0
IFRS rebased P&E additions (including
costs to capture)
$
724.1
$
587.6
$
1,373.8
$
1,200.3
Adjusted EBITDA less P&E
additions:
U.S. GAAP Adjusted EBITDA less P&E
additions
$
468.0
$
370.1
$
903.3
$
1,106.1
Rebase adjustments(ii)(iii)
1.9
155.5
3.9
28.3
U.S. GAAP rebased Adjusted EBITDA less
P&E additions
469.9
525.6
907.2
1,134.4
U.S. GAAP/IFRS adjustments(iv)
55.4
106.3
98.1
134.9
IFRS rebased Adjusted EBITDA less P&E
additions (including costs to capture)
$
525.3
$
631.9
$
1,005.3
$
1,269.3
______________________
(i)
Revenue rebase adjustments relate to (i)
for 2022, the VMO2 JV's construction agreement with the nexfibre JV
of approximately $166 million and $288 million, respectively, (ii)
for the 2022 YTD period, the exclusion of certain handset
securitization transactions in Q1 2022 of approximately $44 million
related to restructuring of the legacy O2 securitization structure
and (iii) certain transaction adjustments made to reflect the JV's
new basis of accounting, which reverse the effect of the write-off
of deferred revenue.
(ii)
Adjusted EBITDA rebase adjustments relate
to (i) for the 2022 YTD period, the exclusion of certain handset
securitization transactions in Q1 2022 of approximately $233
million related to restructuring of the legacy O2 securitization
structure, (ii) for 2022, the VMO2 JV's construction agreement with
the nexfibre JV of approximately $18 million and $31 million,
respectively, and (iii) certain transaction adjustments made to
reflect the JV's new basis of accounting, which reverse the effect
of the write-off of deferred commissions, install costs and
deferred revenue.
(iii)
P&E rebase adjustments for 2022 relate
to the VMO2 JV's construction agreement with the nexfibre JV of
approximately $148 million and $257 million, respectively.
(iv)
U.S. GAAP/IFRS differences primarily
relate to (i) the VMO2 JV's investment in CTIL and (ii) lease
accounting.
9 Converged households or converged SIMs represent customers in
either our Consumer or SOHO segment that subscribe to both a
fixed-line digital TV and an internet service and Vodafone and/or
hollandsnieuwe postpaid mobile telephony service. 10 Our aggregate
unused borrowing capacity of $1.6 billion represents the maximum
undrawn commitments under the applicable facilities without regard
to covenant compliance calculations or other conditions precedent
to borrowing. Upon completion of the relevant June 30, 2023
compliance reporting requirements for our credit facilities, and
assuming no further changes from quarter-end borrowing levels, we
anticipate that (i) the full €713.4 million ($778.9 million) of
borrowing capacity will be available under the UPC Holding Bank
Facility, (ii) the full €645.0 million ($704.2 million) of
borrowing capacity will be available under the Telenet Credit
Facility and (iii) the full €100.0 million ($109.2 million) of
borrowing capacity will be available under the VM Ireland Credit
Facility. Our above expectations do not consider any actual or
potential changes to our borrowing levels or any amounts loaned or
distributed subsequent to June 30, 2023. 11 The term "Full Company"
includes certain amounts that were classified as discontinued
operations prior to disposal. We also present Full Company Adjusted
Free Cash Flow and Full Company Distributable Cash Flow, consistent
with the basis for our full year 2023 Distributable Cash Flow
guidance. 12 For purposes of calculating our average tenor, total
third-party debt excludes vendor financing, certain debt
obligations that we assumed in connection with various
acquisitions, and liabilities related to Telenet's acquisition of
mobile spectrum licenses. The percentage of debt not due until 2029
or thereafter includes all of these amounts.
Glossary
10-Q or 10-K: As used herein, the
terms 10-Q and 10-K refer to our most recent quarterly or annual
report as filed with the Securities and Exchange Commission on Form
10-Q or Form 10-K, as applicable.
Adjusted EBITDA, Adjusted EBITDA less
P&E Additions and Property and Equipment Additions (P&E
Additions):
- Adjusted EBITDA: Adjusted EBITDA
is the primary measure used by our chief operating decision maker
to evaluate segment operating performance and is also a key factor
that is used by our internal decision makers to (i) determine how
to allocate resources to segments and (ii) evaluate the
effectiveness of our management for purposes of annual and other
incentive compensation plans. As we use the term, Adjusted EBITDA
is defined as earnings (loss) from continuing operations before net
income tax benefit (expense), other non-operating income or
expenses, net share of results of affiliates, net gains (losses) on
debt extinguishment, net realized and unrealized gains (losses) due
to changes in fair values of certain investments, net foreign
currency transaction gains (losses), net gains (losses) on
derivative instruments, net interest expense, depreciation and
amortization, share-based compensation, provisions and provision
releases related to significant litigation and impairment,
restructuring and other operating items. Other operating items
include (a) gains and losses on the disposition of long-lived
assets, (b) third-party costs directly associated with successful
and unsuccessful acquisitions and dispositions, including legal,
advisory and due diligence fees, as applicable, and (c) other
acquisition-related items, such as gains and losses on the
settlement of contingent consideration. Our internal decision
makers believe Adjusted EBITDA is a meaningful measure because it
represents a transparent view of our recurring operating
performance that is unaffected by our capital structure and allows
management to (1) readily view operating trends, (2) perform
analytical comparisons and benchmarking between segments and (3)
identify strategies to improve operating performance in the
different countries in which we operate. We believe our
consolidated Adjusted EBITDA measure, which is a non-GAAP measure,
is useful to investors because it is one of the bases for comparing
our performance with the performance of other companies in the same
or similar industries, although our measure may not be directly
comparable to similar measures used by other public companies.
Consolidated Adjusted EBITDA should be viewed as a measure of
operating performance that is a supplement to, and not a substitute
for, U.S. GAAP measures of income included in our condensed
consolidated statements of operations.
- Adjusted EBITDA less P&E
Additions: We define Adjusted EBITDA less P&E Additions,
which is a non-GAAP measure, as Adjusted EBITDA less property and
equipment additions on an accrual basis. Adjusted EBITDA less
P&E Additions is a meaningful measure because it provides (i) a
transparent view of Adjusted EBITDA that remains after our capital
spend, which we believe is important to take into account when
evaluating our overall performance and (ii) a comparable view of
our performance relative to other telecommunications companies. Our
Adjusted EBITDA less P&E Additions measure may differ from how
other companies define and apply their definition of similar
measures. Adjusted EBITDA less P&E Additions should be viewed
as a measure of operating performance that is a supplement to, and
not a substitute for, U.S. GAAP measures of income included in our
condensed consolidated statements of operations.
- P&E Additions: Includes
capital expenditures on an accrual basis, amounts financed under
vendor financing or finance lease arrangements and other non-cash
additions. A reconciliation of earnings (loss) from continuing
operations to Adjusted EBITDA and Adjusted EBITDA less P&E
Additions is presented in the following table:
Three months ended
Six months ended
June 30,
June 30,
2023
2022
2023
2022
in millions
Earnings (loss) from continuing
operations
$
(511.3
)
$
2,282.2
$
(1,224.8
)
$
3,357.9
Income tax expense
159.2
63.6
171.7
144.8
Other income, net
(75.8
)
(29.4
)
(119.7
)
(41.3
)
Gain on Telenet Tower Sale
—
(693.3
)
—
(693.3
)
Share of results of affiliates, net
(138.3
)
(81.1
)
100.3
(311.6
)
Realized and unrealized losses due to
changes in fair values of certain investments, net
410.8
111.9
416.3
205.3
Foreign currency transaction losses
(gains), net
(56.4
)
(1,148.7
)
246.5
(1,723.7
)
Realized and unrealized gains on
derivative instruments, net
(51.1
)
(613.6
)
(16.7
)
(1,121.9
)
Interest expense
213.7
132.9
414.6
267.1
Operating income (loss)
(49.2
)
24.5
(11.8
)
83.3
Impairment, restructuring and other
operating items, net
3.9
58.3
20.3
67.7
Depreciation and amortization
570.9
517.7
1,097.8
1,082.4
Share-based compensation expense
75.8
49.3
119.6
100.7
Adjusted EBITDA
601.4
649.8
1,225.9
1,334.1
Property and equipment additions
(352.7
)
(336.0
)
(742.6
)
(717.9
)
Adjusted EBITDA less P&E Additions
$
248.7
$
313.8
$
483.3
$
616.2
Adjusted EBITDA after leases (Adjusted
EBITDAaL): We define Adjusted EBITDAaL as Adjusted EBITDA as
further adjusted to include finance lease related depreciation and
interest expense. Our internal decision makers believe Adjusted
EBITDAaL is a meaningful measure because it represents a
transparent view of our recurring operating performance that
includes recurring lease expenses necessary to operate our
business. We believe Adjusted EBITDAaL, which is a non-GAAP
measure, is useful to investors because it is one of the bases for
comparing our performance with the performance of other companies
in the same or similar industries, although our measure may not be
directly comparable to similar measures used by other public
companies. Adjusted EBITDAaL should be viewed as a measure of
operating performance that is a supplement to, and not a substitute
for, U.S. GAAP measures of income included in our condensed
consolidated statements of operations.
Adjusted Free Cash Flow (Adjusted FCF)
& Distributable Cash Flow:
- Adjusted FCF: We define Adjusted FCF as net cash provided by
the operating activities of our continuing operations, plus
operating-related vendor financed expenses (which represents an
increase in the period to our actual cash available as a result of
extending vendor payment terms beyond normal payment terms, which
are typically 90 days or less, through non-cash financing
activities), less (i) cash payments in the period for capital
expenditures, (ii) principal payments on operating- and
capital-related amounts financed by vendors and intermediaries
(which represents a decrease in the period to our actual cash
available as a result of paying amounts to vendors and
intermediaries where we previously had extended vendor payments
beyond the normal payment terms), and (iii) principal payments on
finance leases (which represents a decrease in the period to our
actual cash available), each as reported in our condensed
consolidated statements of cash flows with each item excluding any
cash provided or used by our discontinued operations. Net cash
provided by operating activities includes cash paid for third-party
costs directly associated with successful and unsuccessful
acquisition and dispositions of $4.5 million and $8.8 million
during the three months ended June 30, 2023 and 2022, respectively,
and $16.1 million and $22.2 million during the six months ended
June 30, 2023 and 2022, respectively.
- Distributable Cash Flow: We define
Distributable Cash Flow as Adjusted FCF plus any dividends received
from our equity affiliates that are funded by activities outside of
their normal course of operations, including, for example, those
funded by recapitalizations (referred to as “Other Affiliate
Dividends”).
We believe our presentation of Adjusted FCF and Distributable
Cash Flow, each of which is a non-GAAP measure, provides useful
information to our investors because these measures can be used to
gauge our ability to (i) service debt and (ii) fund new investment
opportunities after consideration of all actual cash payments
related to our working capital activities and expenses that are
capital in nature, whether paid inside normal vendor payment terms
or paid later outside normal vendor payment terms (in which case we
typically pay in less than 365 days). Adjusted FCF and
Distributable Cash Flow should not be understood to represent our
ability to fund discretionary amounts, as we have various mandatory
and contractual obligations, including debt repayments, that are
not deducted to arrive at these amounts. Investors should view
Adjusted FCF and Distributable Cash Flow as supplements to, and not
substitutes for, U.S. GAAP measures of liquidity included in our
condensed consolidated statements of cash flows. Further, our
Adjusted FCF and Distributable Cash Flow may differ from how other
companies define and apply their definition of Adjusted FCF or
other similar measures. Consistent with the basis for our full year
2023 Distributable Cash Flow guidance, the following table provides
a reconciliation of our Full Company net cash provided by operating
activities to Full Company Adjusted FCF and Full Company
Distributable Cash Flow for the indicated periods.
Three months ended
Six months ended
June 30,
June 30,
2023
2022
2023
2022
in millions
Net cash provided by operating
activities
$
691.8
$
757.4
$
999.6
$
1,414.1
Operating-related vendor financing
additions(i)
135.3
97.6
276.7
237.8
Cash capital expenditures, net
(311.2
)
(261.4
)
(688.4
)
(650.0
)
Principal payments on operating-related
vendor financing
(125.4
)
(110.7
)
(268.9
)
(322.4
)
Principal payments on capital-related
vendor financing
(57.7
)
(42.6
)
(162.2
)
(84.0
)
Principal payments on finance leases
(4.1
)
(13.3
)
(6.5
)
(31.3
)
Full Company Adjusted FCF
328.7
427.0
150.3
564.2
Other affiliate dividends
205.2
—
403.5
—
Full Company Distributable Cash Flow
$
533.9
$
427.0
$
553.8
$
564.2
_______________
(i)
For purposes of our condensed consolidated
statements of cash flows, operating-related vendor financing
additions represent operating-related expenses financed by an
intermediary that are treated as constructive operating cash
outflows and constructive financing cash inflows when the
intermediary settles the liability with the vendor. When we pay the
financing intermediary, we record financing cash outflows in our
condensed consolidated statements of cash flows. For purposes of
our Adjusted FCF definition, we (i) add in the constructive
financing cash inflow when the intermediary settles the liability
with the vendor as our actual net cash available at that time is
not affected and (ii) subsequently deduct the related financing
cash outflow when we actually pay the financing intermediary,
reflecting the actual reduction to our cash available to service
debt or fund new investment opportunities.
ARPU: Average Revenue Per Unit is
the average monthly subscription revenue per average fixed customer
relationship or mobile subscriber, as applicable. ARPU per average
fixed-line customer relationship is calculated by dividing the
average monthly subscription revenue from residential fixed and
SOHO services by the average number of fixed-line customer
relationships for the period. ARPU per average mobile subscriber is
calculated by dividing mobile subscription revenue for the
indicated period by the average number of mobile subscribers for
the period. Unless otherwise indicated, ARPU per fixed customer
relationship or mobile subscriber is not adjusted for currency
impacts. ARPU per RGU refers to average monthly revenue per average
RGU, which is calculated by dividing the average monthly
subscription revenue from residential and SOHO services for the
indicated period, by the average number of the applicable RGUs for
the period. Unless otherwise noted, ARPU in this release is
considered to be ARPU per average fixed customer relationship or
mobile subscriber, as applicable. Fixed-line customer
relationships, mobile subscribers and RGUs of entities acquired
during the period are normalized. In addition, for purposes of
calculating the percentage change in ARPU on a rebased basis, which
is a non-GAAP measure, we adjust the prior-year subscription
revenue, fixed-line customer relationships, mobile subscribers and
RGUs, as applicable, to reflect acquisitions, dispositions and FX
on a comparable basis with the current year, consistent with how we
calculate our rebased growth for revenue and Adjusted EBITDA, as
further described in the body of this release.
ARPU per Mobile Subscriber: Our
ARPU per mobile subscriber calculation that excludes interconnect
revenue refers to the average monthly mobile subscription revenue
per average mobile subscriber and is calculated by dividing the
average monthly mobile subscription revenue (excluding handset
sales and late fees) for the indicated period, by the average of
the opening and closing balances of mobile subscribers in service
for the period. Our ARPU per mobile subscriber calculation that
includes interconnect revenue increases the numerator in the
above-described calculation by the amount of mobile interconnect
revenue during the period.
Blended, fully-swapped debt borrowing
cost: The weighted average interest rate on our aggregate
variable- and fixed-rate indebtedness (excluding finance leases and
including vendor financing obligations), including the effects of
derivative instruments, original issue premiums or discounts and
commitment fees, but excluding the impact of financing costs. The
weighted average interest rate calculation includes principal
amounts outstanding associated with all of our secured and
unsecured borrowings.
B2B: Business-to-Business.
Customer Churn: The rate at which
customers relinquish their subscriptions. The annual rolling
average basis is calculated by dividing the number of disconnects
during the preceding 12 months by the average number of customer
relationships. For the purpose of computing churn, a disconnect is
deemed to have occurred if the customer no longer receives any
level of service from us and is required to return our equipment. A
partial product downgrade, typically used to encourage customers to
pay an outstanding bill and avoid complete service disconnection,
is not considered to be disconnected for purposes of our churn
calculations. Customers who move within our footprint and upgrades
and downgrades between services are also excluded from the
disconnect figures used in the churn calculation.
Debt and Net Debt Ratios: Our debt
and net debt ratios, which are non-GAAP metrics, are defined as
total debt and net debt, respectively, divided by reported net loss
for the last twelve months (reported LTM net loss) and Adjusted
EBITDA for the last twelve months (LTM Adjusted EBITDA). Net debt
is defined as total debt less cash and cash equivalents and
investments held under SMAs. For purposes of these calculations,
debt is measured using swapped foreign currency rates, consistent
with the covenant calculation requirements of our subsidiary debt
agreements. The following table details the calculation of our debt
and net debt to reported LTM net loss and LTM Adjusted EBITDA
ratios as of and for the twelve months ended June 30, 2023 (in
millions, except ratios):
Reconciliation of reported LTM net loss
to LTM Adjusted EBITDA:
Reported LTM net loss
$
(3,477.4
)
Income tax expense
345.8
Other income, net
(215.6
)
Gain on Telenet Tower Sale
(7.2
)
Share of results of affiliates, net
1,679.7
Realized and unrealized loss due to
changes in fair values of certain investments, net
512.8
Foreign currency transaction loss, net
563.0
Realized and unrealized gain on derivative
instruments, net
(86.2
)
Interest expense
736.8
Operating income
51.7
Impairment, restructuring and other
operating items, net
37.7
Depreciation and amortization
2,186.8
Share-based compensation expense
211.0
LTM Adjusted EBITDA
$
2,487.2
Debt to reported LTM net loss and LTM
Adjusted EBITDA:
Debt and finance lease obligations before
deferred financing costs, discounts and premiums
$
15,260.8
Principal related projected derivative
cash payments
275.4
Vodafone Collar Loan
(1,373.6
)
Adjusted debt and finance lease
obligations before deferred financing costs, discounts and
premiums
$
14,162.6
Reported LTM net loss
$
(3,477.4
)
Debt to reported LTM net loss ratio
(4.1
)
LTM Adjusted EBITDA
$
2,487.2
Debt to LTM Adjusted EBITDA ratio
5.7
Net Debt to reported LTM net loss and
LTM Adjusted EBITDA:
Adjusted debt and finance lease
obligations before deferred financing costs, discounts and
premiums
$
14,162.6
Cash and cash equivalents and investments
held under SMAs
(3,858.6
)
Adjusted net debt and finance lease
obligations before deferred financing costs, discounts and
premiums
$
10,304.0
Reported LTM net loss
$
(3,477.4
)
Net debt to reported LTM net loss
ratio
(3.0
)
LTM Adjusted EBITDA
$
2,487.2
Net debt to LTM Adjusted EBITDA ratio
4.1
Fixed-Line Customer Relationships:
The number of customers who receive at least one of our internet,
video or telephony services that we count as RGUs, without regard
to which or to how many services they subscribe. Fixed-Line
Customer Relationships generally are counted on a unique premises
basis. Accordingly, if an individual receives our services in two
premises (e.g., a primary home and a vacation home), that
individual generally will count as two Fixed-Line Customer
Relationships. We exclude mobile-only customers from Fixed-Line
Customer Relationships.
Fixed-Mobile Convergence (FMC):
Fixed-mobile convergence penetration represents the number of
customers who subscribe to both a fixed broadband internet service
and postpaid mobile telephony service, divided by the total number
of customers who subscribe to our fixed broadband internet
service.
Homes Passed: Homes, residential
multiple dwelling units or commercial units that can be connected
to our networks without materially extending the distribution
plant. Certain of our Homes Passed counts are based on census data
that can change based on either revisions to the data or from new
census results.
Internet Subscriber: A home,
residential multiple dwelling unit or commercial unit that receives
internet services over our networks, or that we service through a
partner network.
Lightning Premises: Includes homes,
residential multiple dwelling units and commercial premises that
potentially could subscribe to our residential or SOHO services,
which have been connected to the VMO2 JV's networks in the U.K. and
Ireland as a part of the Project Lightning network extension
program. Project Lightning infill build relates to construction in
areas adjacent to our existing network.
Mobile Subscriber Count: For
residential and business subscribers, the number of active SIM
cards in service rather than services provided. For example, if a
mobile subscriber has both a data and voice plan on a smartphone
this would equate to one mobile subscriber. Alternatively, a
subscriber who has a voice and data plan for a mobile handset and a
data plan for a laptop would be counted as two mobile subscribers.
Customers who do not pay a recurring monthly fee are excluded from
our mobile telephony subscriber counts after periods of inactivity
ranging from 30 to 90 days, based on industry standards within the
respective country. In a number of countries, our mobile
subscribers receive mobile services pursuant to prepaid
contracts.
MVNO: Mobile Virtual Network
Operator.
RGU: A Revenue Generating Unit is
separately an Internet Subscriber, Video Subscriber or Telephony
Subscriber. A home, residential multiple dwelling unit, or
commercial unit may contain one or more RGUs. For example, if a
residential customer subscribed to our broadband internet service,
video service and fixed-line telephony service, the customer would
constitute three RGUs. Total RGUs is the sum of Internet, Video and
Telephony Subscribers. RGUs generally are counted on a unique
premises basis such that a given premise does not count as more
than one RGU for any given service. On the other hand, if an
individual receives one of our services in two premises (e.g., a
primary home and a vacation home), that individual will count as
two RGUs for that service. Each bundled internet, video or
telephony service is counted as a separate RGU regardless of the
nature of any bundling discount or promotion. Non-paying
subscribers are counted as subscribers during their free
promotional service period. Some of these subscribers may choose to
disconnect after their free service period. Services offered
without charge on a long-term basis (e.g., VIP subscribers or free
service to employees) generally are not counted as RGUs. We do not
include subscriptions to mobile services in our externally reported
RGU counts. In this regard, our RGU counts exclude our separately
reported postpaid and prepaid mobile subscribers.
SIM: Subscriber Identification
Module.
SOHO: Small or Home Office
Subscribers.
Telephony Subscriber: A home,
residential multiple dwelling unit or commercial unit that receives
voice services over our networks, or that we service through a
partner network. Telephony Subscribers exclude mobile telephony
subscribers.
U.S. GAAP: Accounting principles
generally accepted in the United States.
Video Subscriber: A home,
residential multiple dwelling unit or commercial unit that receives
our video service over our broadband network or through a partner
network.
YoY: Year-over-year.
Appendix - Supplemental Tech Framework Information
During the first quarter of 2023, we changed the terms related
to, and approach to how we reflect the allocation of, charges for
certain products and services that our centrally-managed technology
and innovation function (our T&I Function) provide to our
consolidated reportable segments (the Tech Framework). These
products and services include CPE hardware and related essential
software, maintenance, hosting and other services. As a result, our
consolidated reportable segments now capitalize the combined cost
of the CPE hardware and essential software as property and
equipment additions. The other services, including maintenance and
hosting, continue to be reported as operating costs in the period
incurred (included in our Adjusted EBITDA). The corresponding
amounts charged by our T&I Function are reflected as revenue
when earned. The new Tech Framework is a result of internal changes
with respect to the way in which our chief operating decision maker
evaluates the revenue, Adjusted EBITDA and property and equipment
additions of our consolidated reportable segments. Segment
information has been revised, as applicable, to reflect these
changes. The following table provides a summary of the impact on
the revenue, Adjusted EBITDA and property and equipment additions
of our consolidated reportable segments and Central and Other.
Three months ended
June 30,
Six months ended
June 30,
2023
2022
2023
2022
in millions
Increase (decrease) to
revenue(i):
Central and Other
$
61.2
$
59.9
$
118.6
$
119.9
Intersegment eliminations
(61.2
)
(59.9
)
(118.6
)
(119.9
)
Total
$
—
$
—
$
—
$
—
Increase (decrease) to Adjusted
EBITDA(ii):
Switzerland
$
(16.2
)
$
(9.8
)
$
(31.9
)
$
(20.2
)
Belgium
(2.2
)
(2.1
)
(4.4
)
(4.4
)
Ireland
(6.1
)
(3.5
)
(12.0
)
(7.3
)
Central and Other
39.7
30.3
78.5
62.5
Intersegment eliminations
(15.2
)
(14.9
)
(30.2
)
(30.6
)
Total
$
—
$
—
$
—
$
—
Increase (decrease) to property and
equipment additions(iii):
Switzerland
$
5.7
$
5.6
$
11.2
$
11.4
Belgium
6.9
6.8
13.8
14.0
Ireland
2.6
2.5
5.2
5.2
Central and Other
—
—
—
—
Intersegment eliminations
(15.2
)
(14.9
)
(30.2
)
(30.6
)
Total
$
—
$
—
$
—
$
—
______________________
(i)
Amounts reflect the revenue recognized
within our T&I Function, as well as any applicable markup
related to the Tech Framework.
(ii)
Amounts reflect the charge to each
respective consolidated reportable segment related to the service
and maintenance component of the Tech Framework and additionally,
for Central and Other, the Adjusted EBITDA impact of the value
attributed to centrally-held internally developed technology that
is embedded within our various CPE, as well as any applicable
markup.
(iii)
Amounts reflect the charge to each
respective consolidated reportable segment related to the value
attributed to centrally-held internally developed technology that
is embedded within our various CPE, as well as any applicable
markup.
Appendix - Supplemental Adjusted EBITDAaL Information
The following table presents (i) Adjusted EBITDA, (ii) finance
lease-related depreciation and interest expense adjustments, (iii)
Adjusted EBITDAaL and (iv) the percentage change from period to
period for Adjusted EBITDA and Adjusted EBITDAaL on both a reported
and rebased basis for each of our reportable segments.
Three months ended
June 30,
Increase/(decrease)
Six months ended
June 30,
Increase/(decrease)
2023
2022
Reported %
Rebased %
2023
2022(i)
Reported %
Rebased %
in millions, except %
amounts
Adjusted EBITDA:
Switzerland
$
287.1
$
266.7
7.6
(0.1
)
$
550.1
$
557.5
(1.3
)
(4.7
)
Belgium
346.0
328.2
5.4
5.0
648.9
666.3
(2.6
)
0.6
Ireland
47.3
48.5
(2.5
)
(4.4
)
88.8
95.6
(7.1
)
(6.1
)
Central and Other
(63.8
)
21.3
N.M.
N.M.
(31.7
)
46.1
N.M.
N.M.
Intersegment eliminations(ii)
(15.2
)
(14.9
)
N.M.
N.M.
(30.2
)
(31.4
)
N.M.
N.M.
Total Adjusted EBITDA
$
601.4
$
649.8
(7.4
)
(7.6
)
$
1,225.9
$
1,334.1
(8.1
)
(6.8
)
VMO2 JV(iii)
$
1,138.8
$
1,059.4
7.5
2.6
$
2,164.7
$
2,454.7
(11.8
)
2.3
VodafoneZiggo JV(iii)
$
484.9
$
490.9
(1.2
)
(3.6
)
$
956.4
$
1,028.7
(7.0
)
(5.9
)
Finance lease adjustments:
Switzerland
$
(1.7
)
$
(3.4
)
$
(2.9
)
$
(4.2
)
Belgium
(2.9
)
(20.3
)
(23.2
)
(40.5
)
Central and Other
(2.1
)
(2.0
)
(4.1
)
(4.0
)
Total finance lease adjustments
$
(6.7
)
$
(25.7
)
$
(30.2
)
$
(48.7
)
VMO2 JV(iii)
$
(2.0
)
$
(2.3
)
$
(4.1
)
$
(4.7
)
VodafoneZiggo JV(iii)
$
(2.1
)
$
(2.3
)
$
(4.5
)
$
(4.8
)
Adjusted EBITDAaL:
Switzerland
$
285.4
$
263.3
8.4
(0.1
)
$
547.2
$
553.3
(1.1
)
(4.8
)
Belgium
343.1
307.9
11.4
11.2
625.7
625.8
—
3.6
Ireland
47.3
48.5
(2.5
)
(4.4
)
88.8
95.6
(7.1
)
(6.1
)
Central and Other
(65.9
)
19.3
N.M.
N.M.
(35.8
)
42.1
N.M.
N.M.
Intersegment eliminations(ii)
(15.2
)
(14.9
)
N.M.
N.M.
(30.2
)
(31.4
)
N.M.
N.M.
Total Adjusted EBITDAaL
$
594.7
$
624.1
(4.7
)
(4.0
)
$
1,195.7
$
1,285.4
(7.0
)
(5.6
)
VMO2 JV(iii)
$
1,136.8
$
1,057.1
7.5
6.8
$
2,160.6
$
2,450.0
(11.8
)
(2.7
)
VodafoneZiggo JV(iii)
$
482.8
$
488.6
(1.2
)
(3.5
)
$
951.9
$
1,023.9
(7.0
)
(5.9
)
______________________
N.M. - Not Meaningful
(i)
Amounts have been revised, as applicable,
to reflect the retrospective impact of the Tech Framework, as
described above.
(ii)
Amounts relate to (a) the Adjusted EBITDA
impact to Central and Other of the value attributed to
centrally-held internally developed technology that is embedded
within our various CPE, as well as any applicable markup, and (b)
for 2022, transactions between our continuing and discontinued
operations.
(iii)
Amounts reflect 100% of the 50:50
non-consolidated VMO2 JV and VodafoneZiggo JV.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230724398632/en/
Investor Relations Michael Bishop +44 20 8483 6246 Amy
Ocen +1 303 784 4528 Michael Khehra +44 78 9005 0979
Corporate Communications Bill Myers +1 303 220 6686 Matt
Beake +44 20 8483 6428
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