Liberty Global Ltd. · NASDAQ:LBTYA
Liberty Global — Q3 2022 Earnings Presentation
41 slides from Liberty Global's earnings presentation, Nov 2, 2022
Slide 1: Investor Call Q3 2022
Updated Cover on new template LIBERTY GLOBAL PLC INVESTOR CALL Q3 2022 November 2, 2022
Slide 2: Safe Harbor: Forward-Looking Statements + Disclaimer
“SAFE HARBOR” in currency exchange and interest rates; the ability of suppliers, vendors and contractors to timely deliver Forward-Looking Statements + Disclaimer quality products, equipment, software, services and access; our and our affiliates’ ability to adequately forecast and plan future networ
Slide 3: Q3 2022 Key Highlights
Q3 2022 KEY HIGHLIGHTS Resilient, subscription-based business performing well despite 1 challenging macro conditions Acceleration in EBITDA growth at VMO2, VZ and TNET through 2 synergies, strong cost control and price adjustments Investment in fixed network upgrades and 5G underpins leading 3 FMC p
Slide 4: Q3'22 Connectivity Trends: Steady Mobile Growth While Fixed Largely Stable
Q3’22 CONNECTIVITY TRENDS: STEADY MOBILE GROWTH WHILE FIXED LARGELY STABLE Postpaid Mobile Net Adds Broadband Net Adds VMO2 VMO2 (1) (2) BROADBAND SUNRISE BROADBAND AND POSTPAID MOBILE AND POSTPAID MOBILE Broadband: Continued broadband growth (+19k) despite competitive market. NET ADDS NET ADDS VOLT
Slide 5: Revenue Mix: FMC Champions Benefitting from Resilient Broadband, Mobile and B2B Growth
REVENUE MIX(1): FMC CHAMPIONS BENEFITTING FROM RESILIENT BROADBAND, MOBILE AND B2B GROWTH (2) (2) Growth (%) Q3 YTD Q3 YTD Q3 YTD Q3 YTD Total Revenue (0.6%) (0.2%) +1.5% +0.7% +3.1% +1.5% +1.0% 0.0% Consumer Fixed (2.4%) (3) (1.7%) (3) (4.5%) (4.0%) +0.8% (1.3%) (2.5%) (2.9%) - Broadband +6.3% +7.7
Slide 6: Network Strategy: Market-by-Market Approach to Fixed and Mobile Development
NETWORK STRATEGY: MARKET-BY-MARKET APPROACH TO FIXED AND MOBILE DEVELOPMENT UNIQUE ROADMAPS TO 10 GIG RAPIDLY ACCELERATING 5G COVERAGE FTTH DOCSIS 4 Hybrid 18% 93% 36% IRELAND ALREADY 1 GIG EVERYWHERE (YE’22) 97% Q3’22 FIXED UPDATES Q3’22 MOBILE UPDATES UK Greenfield: On track for 500k+ new homes bu
Slide 7: Capital Allocation: Commitment to Shareholder Remuneration and Sound Balance Sheet
CAPITAL ALLOCATION: COMMITMENT TO SHAREHOLDER REMUNERATION AND SOUND BALANCE SHEET AVERAGE ANNUAL SHARE BUYBACK YIELD(1) SOUND BALANCE SHEET • Substantial corporate liquidity. Buyback $1.7bn Consolidated cash balance of Spend (2) ~$11bn $4.0B , of which $3.0B at corporate level (mainly USD) and no t
Slide 8: Financial Results
INVESTOR CALL Q3 2022 FINANCIAL RESULTS
Slide 9: Q3'22 Revenue: Stable to Growing Topline
Q3’22 REVENUE: STABLE TO GROWING TOPLINE(1) VMO2(2) TRANSACTION ADJ. SUNRISE VMO2(2) REVENUE GROWTH (%) REVENUE GROWTH (%) Modest decline in Q3, with weakness in consumer fixed (ARPU pressure) and tough B2B fixed trends not fully offset by mobile growth 1.5% Mobile revenue (ex handsets) continued to
Slide 10: VMO2 Revenue Deep Dive: Consumer Revenue Supported by Mobile Growth
VMO2 REVENUE DEEP DIVE: CONSUMER REVENUE SUPPORTED BY MOBILE GROWTH(1) Total Revenue (ex Handsets, B2B fixed Total Revenue (ex Handsets, B2B fixed and other) (£m) and other) +1.4% YOY VMO2 revenue growing +1.4% excluding handsets (low margin), B2B fixed and other (SMIP) revenues which both remain lu
Slide 11: Q3'22 EBITDA: Resilient Trends Including UK Synergy Execution
Q3’22 EBITDA: RESILIENT TRENDS INCLUDING UK SYNERGY EXECUTION(1) VMO2(2) TRANSACTION ADJ. SUNRISE VMO2(2) EBITDA GROWTH (%) EBITDA GROWTH (%) Continued acceleration in EBITDA growth driven by synergy execution and 8.2% price rises; MVNO migration set to support Q4 Incl $35M 9.6% Q3 includes $35m one
Slide 12: Capital Allocation: Capital Intensity on Track and Ventures Update
CAPITAL ALLOCATION: CAPITAL INTENSITY ON TRACK AND VENTURES UPDATE 9M’22 CAPITAL INTENSITY IN LINE WITH GUIDANCE (1) VENTURES PORTFOLIO DECLINED SLIGHTLY IN Q3, 25.0% Includes ROU Additions Overall FMV fell to $3B (from $3.2B at Q2’22). Key drivers: 20.0% • CONTENT –Impacted by fall in ITV share pri
Slide 13: Full Company Distributable CF: Reiterating FY Guidance of $1.7B
FULL COMPANY DISTRIBUTABLE CF(1): REITERATING FY GUIDANCE OF $1.7B (AT GUIDANCE FX) $M FY 2021 9M 2022 ADJ EBITDA LESS P&E ADDITIONS $1,921 $934 NET INTEREST (821) (431) CASH TAX (190) (167) DIVIDENDS & INTEREST FROM JV’s (2) 583 429 WORKING CAPITAL (3) (7) (11) DIRECT ACQUISITION COSTS & DEFINITION
Slide 14: Conclusions and 2022 Outlook
2022 OUTLOOK CONCLUSIONS 2022 OUTLOOK Operating Companies(2) Liberty Global GUIDANCE (IFRS basis)(3) GUIDANCE(1) • Improved revenue growth • Confirming $1.7B Full Company Distributable Cash • Mid-single-digit Transaction Adjusted EBITDA growth Flow(1) (on guidance FX basis) (before CTC) (5) • Opex a
Slide 15: Appendix
INVESTOR CALL Q3 2022 APPENDIX
Slide 16: YTD Adj Attributed FCF & Distributable CF
YTD ADJ ATTRIBUTED FCF & DISTRIBUTABLE CF LIBERTY 50-50 50-50 TOTAL VMO2 JV GLOBAL VODAFONEZIGGO $millions IRELAND BELGIUM SWITZERLAND CENTRAL (1) POLAND LIBERTY JV CONTINUING IFRS BASIS GLOBAL OPERATIONS (2,3) (2,3,4) ADJUSTED EBITDA $153 $989 $880 $(24) $1,998 $46 $2,044 $1,530 $3,591 PRE-LIGHTNIN
Slide 17: Q3 2022 YTD Adj EBITDA & Adj EBITDAaL
Q3 2022 YTD ADJ EBITDA & ADJ EBITDAAL(1) LIBERTY 50-50 50-50 GLOBAL VODAFONEZIGGO VMO2 JV $m IRELAND BELGIUM SWITZERLAND CENTRAL (2) CONTINUING JV IFRS BASIS OPERATIONS (3,4) (3,4,5) ADJUSTED EBITDA $153 $989 $880 $(24) $1,998 $1,530 $3,591 DEPRECIATION & AMORTIZATION ON ASSETS UNDER FINANCE LEASE -
Slide 18: Ventures Portfolio FMV $3.0B
VENTURES PORTFOLIO FMV $3.0B(1) VENTURES FAIR MARKET VALUE ($M) VENTURES PORTFOLIO DECLINED SLIGHTLY IN Q3’22, $3.2B $3.0B ending with $3.0B FMV (-c.$0.5B vs Dec-2021)1 • CONTENT – Impacted by fall in ITV share price during the quarter • TECH / INFRASTRUCTURE - Current estimated valuations broadly s
Slide 19: Rebase Information
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 rebased growth rates on a comparable basis for all businesses that we owned during 2022, we have adjusted our historical r
Slide 20: Glossary
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 (
Slide 21: Glossary
GLOSSARY • Distributable Cash Flow: We define Distributable Cash Flow as Adjusted FCF, as re-defined during the fourth quarter of 2021, plus any dividends received from our equity affiliates that are funded by activities outside of their normal course of operations, including, for example, those fun
Slide 22: Glossary
GLOSSARY 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 premise
Slide 23: Reconciliations: Rebase Adjustments
RECONCILIATIONS REBASE ADJUSTMENTS Rebase growth percentages, which are non-GAAP measures, are presented as a basis for assessing growth rates on a comparable basis. For further details on adjustments made to arrive at our rebase growth rates for the periods below, refer to our previously issued ear
Slide 24: Reconciliations: Rebase Adjustments (Continued)
RECONCILIATIONS REBASE ADJUSTMENTS (CONTINUED) 24
Slide 25: Reconciliations: Adjusted EBITDA & Adjusted EBITDA less P&E Additions
RECONCILIATIONS ADJUSTED EBITDA & ADJUSTED EBITDA LESS P&E ADDITIONS The following table provides a reconciliation of our net earnings to Adjusted EBITDA and Adjusted EBITDA less P&E Additions for the nine months September 30, 2022 (in millions): 25
Slide 26: Reconciliations: Adjusted EBITDA & Adjusted EBITDA less P&E Additions (Continued)
RECONCILIATIONS ADJUSTED EBITDA & ADJUSTED EBITDA LESS P&E ADDITIONS (CONTINUED) The following table provides a reconciliation of our net earnings to Adjusted EBITDA and Adjusted EBITDA less P&E Additions for the year ended December 31, 2021 (in millions): 26
Slide 27: Reconciliations: Adjusted EBITDA & Adjusted EBITDAaL
RECONCILIATIONS ADJUSTED EBITDA & ADJUSTED EBITDAAL The following table provides a reconciliation of Adjusted EBITDA attributable to our continuing operations to Adjusted EBITDAaL for the nine months September 30, 2022 (in millions): 27
Slide 28: Reconciliations: Full Company Adjusted FCF & Distributable CF
RECONCILIATIONS LIBERTY GLOBAL FULL COMPANY ADJUSTED FCF & DISTRIBUTABLE CF 28
Slide 29: Reconciliations: Full Company Adjusted FCF & Distributable CF (Continued)
RECONCILIATIONS LIBERTY GLOBAL FULL COMPANY ADJUSTED FCF & DISTRIBUTABLE CF (CONTINUED) 29
Slide 30: Reconciliations: Supplemental Adjusted Attributed FCF & Distributable Cash Flow
RECONCILIATIONS SUPPLEMENTAL ADJUSTED ATTRIBUTED FREE CASH FLOW & DISTRIBUTABLE CASH FLOW 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 ca
Slide 31: Reconciliations: Supplemental Adjusted Attributed FCF & Distributable Cash Flow (Continued)
RECONCILIATIONS SUPPLEMENTAL ADJUSTED ATTRIBUTED FREE CASH FLOW & DISTRIBUTABLE CASH FLOW (CONTINUED) 31
Slide 32: Reconciliations – VodafoneZiggo JV
RECONCILIATIONS – VODAFONEZIGGO JV VODAFONEZIGGO JV ADJUSTED FREE CASH FLOW (VODAFONEZIGGOJV ADJ FCF) VodafoneZiggo JV Adjusted FCF is defined as net cash provided by operating activities, plus (i) operating-related vendor financed expenses (which represents an increase in the period to actual cash
Slide 33: Reconciliations: Centrally-Held P&E Attributions
RECONCILIATIONS CENTRALLY-HELD P&E ATTRIBUTIONS / ATTRIBUTED ADJUSTED EBITDA LESS P&E ADDITIONS Property and equipment additions presented for Central and Other include certain capital costs incurred for the benefit of our operating segments. Generally, for purposes of the consolidated financial sta
Slide 34: Reconciliations: Centrally-Held P&E Attributions (Continued)
RECONCILIATIONS CENTRALLY-HELD P&E ATTRIBUTIONS / ATTRIBUTED ADJ EBITDA LESS P&E ADDITIONS - CONTINUED A reconciliation of our Adjusted EBITDA to attributed Adjusted EBITDA less P&E Additions, including Centrally-held Property and Equipment Attributions, consistent with our internal management repor
Slide 35: VMO2 JV Reconciliations – Revenue
VMO2 JV RECONCILIATIONS – REVENUE The following table provides reconciliations from VMO2 JV Transaction Adjusted IFRS revenue to US GAAP revenue for the indicated periods: 35
Slide 36: VMO2 JV Reconciliations – Revenue
VMO2 JV RECONCILIATIONS – REVENUE The following tables provide reconciliations from VMO2 JV Transaction Adjusted IFRS revenue to US GAAP revenue for the indicated periods: 36
Slide 37: VMO2 JV Reconciliations – Revenue (Continued)
VMO2 JV RECONCILIATIONS – REVENUE (CONTINUED) The following tables provide reconciliations from VMO2 JV Transaction Adjusted IFRS revenue to US GAAP revenue for the indicated periods: 37
Slide 38: VMO2 JV Reconciliations – Revenue (Continued)
VMO2 JV RECONCILIATIONS – REVENUE (CONTINUED) The following tables provide reconciliations from VMO2 JV Transaction Adjusted IFRS revenue to US GAAP revenue for the indicated periods: 38
Slide 39: VMO2 JV Reconciliations – Adj EBITDA
VMO2 JV RECONCILIATIONS – ADJ EBITDA The following tables provide reconciliations from VMO2 JV Transaction Adjusted IFRS Adjusted EBITDA to US GAAP Adjusted EBITDA for the indicated periods: 39
Slide 40: VMO2 JV Reconciliations – Adj EBITDA less P&E Additions
VMO2 JV RECONCILIATIONS – ADJ EBITDA LESS P&E ADDITIONS The following table provides reconciliations from VMO2 JV Transaction Adjusted IFRS Adjusted EBITDA to US GAAP Adjusted EBITDA and Adjusted EBITDA less P&E Additions for the indicated period: 40
Slide 41: VMO2 JV Reconciliations – Adjusted FCF
VMO2 JV RECONCILIATIONS – ADJUSTED FCF VMO2 JV ADJUSTED FREE CASH FLOW (VMO2 JV ADJ FCF) VMO2 JV Adjusted FCF is defined as net cash provided by operating activities, plus operating-related vendor financed expenses (which represents an increase in the period to actual cash available as a result of e