Liberty Global Ltd. · NASDAQ:LBTYA
Liberty Global — Q4 2020 Earnings Presentation
37 slides from Liberty Global's earnings presentation, Feb 16, 2021
Slide 1: Investor Call Q4 2020
LIBERTY GLOBAL PLC INVESTOR CALL | Q4 2020 February 16, 2021
Slide 2: Safe Harbor
“SAFE HARBOR” associated with network expansions; other factors detailed from time to time in our filings with the U.S. Securities and Exchange Forward-Looking Statements + Disclaimer Commission; and management’s response to any of the aforementioned factors. For additional information on identifyin
Slide 3: Executive Summary
Slide 4: 2020 Highlights
2020 HIGHLIGHTS FY RESULTS1 OPERATIONS ACTUAL YOY 1 STRONG GROWTH DESPITE COVID 3 FMC CHAMPIONS DELIVERING CUSTOMER +81k +155k NET ADDS • People & networks resilient; supporting our • Sunrise transaction closed in Q4; integration $59.77 -1% FIXED CUSTOMER customers and communities plan well underway
Slide 5: Accelerating Subscriber Growth Supported by Product Innovation
ACCELERATING SUBSCRIBER GROWTH SUPPORTED BY PRODUCT INNOVATION CONSISTENT BROADBAND NEW PRODUCT QUARTERLY IMPROVEMENT SPEED LEADERSHIP LAUNCHES FIXED CUSTOMER NET ADDS GIGABIT COMMERCIAL HZN4 BOXES (000’s, incl. SOHO) READY HOMES(1) (000’s, LG+NL) 1,170 20 991 ACTUAL 56 (M, LG+NL) PRIOR 37 NL 824 YE
Slide 6: Ventures Portfolio Over $4 per Share of Equity Value
VENTURES PORTFOLIO OVER $4 PER SHARE OF EQUITY VALUE (1,2) EM / TECH CONTENT / NON-CORE INFRA- VENTURES SPORTS MEDIA & STRUCTURE DISTRIBUTION ~$940m ~$1.25bn ~$90m ~$120m 40+ 8 2 2 COMPANIES COMPANIES COMPANIES COMPANIES Tech Ventures Content / Sports Infrastructure • Nine unicorns (existing and pot
Slide 7: Financial Results
Slide 8: Underlying Revenue Stable
UNDERLYING REVENUE STABLE U.K. & Ireland Belgium Switzerland REBASED REVENUE GROWTH (1) ESTIMATED COVID REVENUE IMPACTS (0.3%) (4.3%) (1.3%) (0.5%) (1.5%) TOTAL PREMIUM B2B FIXED & MOBILE SPORTS IMPACTS ~$110m ~$34m ~$22m (1.4%) (1.6%) ~$19m (1.8%) ~$54m ~$13m ~$41m ~$13m COVID Drag ~$7m (4.0%) Q1'2
Slide 9: Adj EBITDA in Line with Expectations
ADJ EBITDA IN LINE WITH EXPECTATIONS Costs to capture (CTC) FY CONSOLIDATED GROUP Q4 UKIE REBASED Q4 SWITZERLAND REBASED (1) (1) (1) REBASED ADJUSTED EBITDA ADJUSTED EBITDA ADJUSTED EBITDA ($m) ($m) ($m) Inc. $10 CTC 784 Inc. $7 CTC 5,097 Inc. $17 CTC 276 254 697 4,896 Inc 110 Sunrise Inc 110 Sunris
Slide 10: Delivered 5% OFCF Growth YoY
(1) DELIVERED 5% OFCF GROWTH YOY Costs to capture (CTC) 4.9% LG REBASED OFCF 1.6% UKIE REBASED OFCF 4.0% BE REBASED OFCF GROWTH ($m) GROWTH ($m) GROWTH ($m) Inc. $26 CTC Inc. $7 CTC 2,200 884 1,107 1,090 2,099 851 FY'19 FY'20 FY'19 FY'20 FY'19 FY'20 -1.5% CH REBASED OFCF 9.0% VZ(2) REBASED Excludes
Slide 11: 39% FCF Growth YoY
(1) 39% FCF GROWTH YOY Delivered $1.1bn 2020 FCF, despite FX drags worth ~$60m vs guidance (5) $m FY 2019 FY 2020 OFCF pre-Lightning P&E 2,459 2,530 NET INTEREST (1,118) (1,121) CASH TAX (358) (248) VODAFONE ZIGGO JV 214 299 $1,197 $1,460 WORKING CAPITAL (2) (37) (61) ADJUSTED FCF pre-Lightning P&E(
Slide 12: 2021 Outlook
2021 OUTLOOK (1,2) LG Adjusted FCF of $1.35bn (assuming VMO2 transaction closes mid-year) GUIDANCE GUIDANCE GUIDANCE GUIDANCE IFRS BASIS Revenue growth Adj EBITDA growth Returning to Returning to of up to 1% 1%-3% Revenue growth Revenue growth overcoming regulatory Adj EBITDA growth P+E Additions to
Slide 13: Appendix
Slide 14: Virgin Media: Operations Delivering
VIRGIN MEDIA: OPERATIONS DELIVERING Investment in innovation, digitization and network expansion creates platform for future growth KEY DRIVERS OF PERFORMANCE 2020 KEY RESULTS(1) 1 BEST CUSTOMER ADDS SINCE 2017 AND RECORD LOW CHURN +102k • Three consecutive quarters of customer gains in BAU and Ligh
Slide 15: Virgin Media: Project Lightning Update
VIRGIN MEDIA: PROJECT LIGHTNING UPDATE Project Lightning build continued through the global pandemic. Improved efficiency driving down cost of build HIGHLIGHTS CONSTRUCTION ACTIVITY KPIs • Periodic CPP improved to ~£590 PREMISES CONSTRUCTED (000s) ARPU £ in Q4 as we increased use of PIA Lightning to
Slide 16: Sunrise UPC: Building Commercial Momentum
SUNRISE UPC: BUILDING COMMERCIAL MOMENTUM Leveraging convergence to create the #1 Swiss challenger KEY DRIVERS OF PERFORMANCE 2020 KEY RESULTS(1) 1 CONTINUED GROWTH IN A COMPETITIVE MARKET BROADBAND NET ADDS (45k) • Record sales at Sunrise and UPC drive growth across all product lines (+172k fixed &
Slide 17: Vodafone Ziggo: FMC Is Delivering
VODAFONE ZIGGO: FMC IS DELIVERING Exceeded guidance with 6% FY EBITDA growth KEY DRIVERS OF PERFORMANCE 2020 KEY RESULTS(1) 1 MAINTAINING NETWORK & PRODUCT SUPERIORITY (39k) • 1Gbps speeds in over 3 million homes and footprint to double in 2021 CUSTOMER • Enhanced broadband offerings through SmartWi
Slide 18: Telenet: Growth in Core Operations
TELENET: GROWTH IN CORE OPERATIONS Strong performance in broadband and all 2020 guidance metrics achieved KEY DRIVERS OF PERFORMANCE 2020 KEY RESULTS(1) 1 POSITIVE COMMERCIAL MOMENTUM AND FMC GROWTH (15k) • Quad play FMC subscriber base to 642K, +17% vs 2019 CUSTOMER • FMC penetration now over 46% p
Slide 19: FY 2020 Adjusted Attributed FCF
FY 2020 ADJUSTED ATTRIBUTED FCF All OpCos remain substantially FCF positive despite COVID-19 U.K. & Poland / Liberty 50-50 $m Belgium Switzerland Central (2) Ireland Slovakia Global Dutch JV (3,4) ADJUSTED EBITDA (1) $2,672 $1,413 $694 $216 $(99) $4,896 $2,142 P&E pre-lightning P&E (5) (1,237) (529)
Slide 20: Capital Intensity Falls to 22.5%
2020 RECAP CAPITAL INTENSITY FALLS TO 22.5% 19.6% capital intensity ex-Lightning SPEND BY CATEGORY 2020 SPEND DECLINES CHANGE VS PRIOR YEAR ($M. ex-Sunrise) TOTAL NEW BUILD Lightning build of 426k (vs. 505k in CAPITAL INTENSITY 32.9% 31.0% 25.0% 22.5% 2019), CPP continues to trend down -7% Pre-Light
Slide 21: Central Update
CENTRAL UPDATE Cost base managed in line with service agreements $m 2019 2020 Total Operating Costs(1) • Includes both T&I (core & partner markets) and Corporate spend ($601) ($576) Central Revenue(2,3) $405 $394 • TSA revenue from partner markets offset 100% of related costs • Structures in place t
Slide 22: Capital Allocation
CAPITAL ALLOCATION Q4 FULL COMPANY LIQUIDITY (1) Existing FMC New / Pending Champions FMC Champions $2.9bn Revolving Q4’20 BE VZ UPC (incl. VM/O2 Credit Sunrise) Facilities Leverage(5) 4.40x 5.49x 4.65x 5x $6.2BN TOTAL LIQUIDITY WACD 3.4% 4.3% 4.0% 4.4% $3.3bn Av. Life ~7.5 years ~8 years ~8 years ~
Slide 23: Appendix
EXECUTIVE SUMMARY FINANCIAL RESULTS APPENDIX 23
Slide 24: 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 2020, we have adjusted our historical r
Slide 25: 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 is the primary measure used by our chief operating decisi
Slide 26: Glossary
GLOSSARY B2B: Business-to-Business. Costs to capture (CTC): Costs to capture primarily include incremental, third-party operating and capital related costs that are directly associated with integration activities and certain restructuring activities necessary to combine the operations of a business
Slide 27: Glossary
GLOSSARY MVNO: Mobile Virtual Network Operator. NPS: Net Promoter Score. OFCF: As used herein, Operating Free Cash Flow or "OFCF", which is a non-GAAP measure, represents Adjusted EBITDA less property and equipment additions. OFCF is an additional metric that we use to measure the performance of our
Slide 28: 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 29: Reconciliations: Rebase Adjustments (Continued)
RECONCILIATIONS REBASE ADJUSTMENTS (CONTINUED) UKIE BE CH VZ UKIE BE CH VZ Revenue OFCF Year ended December 31, 2019 Year ended December 31, 2019 in millions in millions Acquisitions............... $ - $ 55.2 $ 285.3 $ - Acquisitions............... $ - $ 0.9 $ 32.7 $ - Dispositions(i)............. -
Slide 30: Reconciliations: Adjusted EBITDA
RECONCILIATIONS ADJUSTED EBITDA The following tables provide a reconciliation of our loss from continuing operations to Adjusted EBITDA for the indicated periods: Year Ended December 31, December 31, 2019 2020 in millions Loss from continuing operations...............................................
Slide 31: Reconciliations: Adjusted FCF
RECONCILIATIONS ADJUSTED FCF The following table provides a reconciliation of our net cash provided by operating activities to Adjusted Free Cash Flow for the indicated periods: Year ended December 31, December 31, 2020 2019 in millions Continuing operations: Net cash provided by operating activitie
Slide 32: Reconciliations: Adjusted FCF (Cont.)
RECONCILIATIONS ADJUSTED FCF (CONT.) (i)The 2019 amounts include an adjustment to exclude from adjusted free cash flow a $50.4 million cash receipt associated with a termination fee received from Sunrise Communications Group AG during the fourth quarter in connection with the termination of a share
Slide 33: Reconciliations: Centrally-Held Operating Cost Allocations
RECONCILIATIONS CENTRALLY-HELD OPERATING COST ALLOCATIONS During the fourth quarter of 2019, we changed the presentation of certain operating costs related to our centrally-managed technology and innovation function. These costs, which were previously included in Central and Corporate, are now alloc
Slide 34: Reconciliations: Centrally-Held P&E Attributions / Attributed OFCF
RECONCILIATIONS CENTRALLY-HELD P&E ATTRIBUTIONS / ATTRIBUTED OFCF Property and equipment additions presented for Central and Corporate include certain capital costs incurred for the benefit of our operating segments. Generally, for purposes of the consolidated financial statements of our borrowing g
Slide 35: Reconciliations: Supplemental Adjusted Attributed Free Cash Flow
RECONCILIATIONS SUPPLEMENTAL ADJUSTED ATTRIBUTED FREE CASH FLOW We define adjusted free cash flow as net cash provided by our operating activities, plus (i) cash payments for third-party costs directly associated with successful and unsuccessful acquisitions and dispositions and (ii) expenses financ
Slide 36: Reconciliations: Supplemental Adjusted Attributed FCF (Cont.)
RECONCILIATIONS SUPPLEMENTAL ADJUSTED ATTRIBUTED FREE CASH FLOW (CONT.) a. Includes intersegment eliminations. b. Represents interest on an intercompany loan that we eliminate for purposes of this presentation as intercompany interest income/expense does not impact our leverage calculations in our c
Slide 37: Reconciliations: VodafoneZiggo JV Adjusted Free Cash Flow
RECONCILIATIONS VODAFONEZIGGO JV ADJUSTED FREE CASH FLOW (JV FCF) JV Adjusted FCF is defined as net cash provided by operating activities, plus (i) expenses financed by an intermediary and (ii) interest payments on certain Shareholder loans, less (a) capital expenditures, (b) principal payments on a