ATC Atotech Limited

ALTICE N.V. - THIRD QUARTER 2016 PRO FORMA RESULTS

• Best momentum across Altice Group since IPO - execution focus and investments in networks and convergence are paying off:
  • Return to revenue growth with all major markets contributing to improvement, expanding margins, growing cash flow conversion.
  • Demonstrating success of Altice Model, reinvesting growing cash flows in infrastructure and content, improving customer experience, churn and KPIs. Rapid de-leveraging to facilitate further investments in growth platform.
  • Balanced footprint in Europe and USA with growth set to accelerate;
    • France another material revenue improvement in Q3 2016 declining 2.0% YoY in Q3 2016 pro forma for recent acquisitions of media assets excluding regulatory impacts (2.4% decline including these impacts) and return to EBITDA growth. FY 2016 revenue trend still expected to be better than FY 2015 (-3.5% YoY) as revenue ex-media assets declined 2.6% YoY in Q3 (vs. -6.1% and -4.6% in Q1 and Q2 2016 respectively);
    • Altice USA better than expected results with stronger revenue growth (including the highest cable revenue growth for Optimum since 2014 at +2.7% YoY, Suddenlink +6.7% YoY in constant currency), significant margin improvement (+8.2pp YoY for Optimum and +5.4pp YoY for Suddenlink) and accelerated network investments. Building best-in-class US cable system to sustain growth (Group has c.41% exposure to large, growing US market);
    • Portugal revenue back to growth for the first time since 2008 in September and overall for Q3 2016 excluding regulatory impacts (+1.2% YoY); Reported revenue flat YoY (0.0%) in Q3 2016 (vs. -3.0% in Q2 2016, -3.5% in Q1 2016 and -7.3% in FY 2015) with fiber growth still accelerating.
• Operational momentum increases confidence in expectation for continued improvement in revenue and EBITDA trends for the remainder of 2016:
  • France (SFR Group) - Focus on improving network quality, customer experience, retention processes and content enriched service bundles, which combined with improving market dynamics and company transformation is expected to drive further significant improvements in revenue and EBITDA trends
  • US (Optimum) - Growth still running ahead of initial expectations. Remain confident in efficiency targets with higher cash flow facilitating reinvestment to drive better customer experience (whole network now offering 300/350Mbps broadband speeds);
  • US (Suddenlink) - Industry-leading margins with focus remaining on customer retention and improving churn. Integration with Optimum progressing well (single management team with one commercial strategy) and Project GigaSpeed network upgrades remain on track;
  • Altice N.V. Group Adjusted EBITDA grew 8.5% YoY on a CC basis driven by the very strong growth of Altice USA (Optimum Adjusted EBITDA +33.1% YoY, Suddenlink +20.8% YoY on a CC basis);
• Altice N.V. Operating Free Cash Flow grew 13.9% YoY on a CC basis in Q3 driven by the very strong growth of Altice USA (Optimum and Suddenlink growing +135.1% and +57.0% YoY on a CC basis respectively).
• Robust, diversified and long-term capital structure: during 2016, Altice has refinanced just over EUR 21 billion equivalent of its debt year to date, extending the weighted average life of the Group's debt by 18 months while keeping the average cost of debt constant.
• Reiterated FY 2016 Altice N.V. Group guidance, including our expectation of an improving trend in Altice Group revenue on a consolidated basis (as given on 15 March 2016 under the prior Group perimeter excluding Optimum and acquired content and media assets, at constant currency). On this basis, we also still expect mid-single digit growth in Group Adjusted EBITDA and Operating Free Cash Flow growth flat to slightly down reflecting accelerated investments. This includes our expectation of growth in the Adjusted EBITDA contribution from France YoY.

Michel Combes, Chief Executive Officer of Altice, said: "We are extremely pleased to see our focus on execution is paying off, delivering substantially better revenue and financial performance across all our major markets including US, France and Portugal. The efficiency savings we are achieving are fueling higher investment in infrastructure and content, and improving customer experience, which is now driving the growth of our business. Altice has fully transformed into a leading transatlantic, converged telecoms and media company and quarter after quarter we find ourselves in a stronger position.

Altice USA with Optimum and Suddenlink has seen a further acceleration in revenue growth while simultaneously improving margins materially, driven by accelerated investments in upgrading our networks and services.

Altice France with SFR is progressing with our innovative strategy based on the convergence of telecoms, media, content and advertising, enabling us to offer more and more value to our customers. We are in the middle of our transformation of SFR and remain confident performance will continue to improve significantly from here. Our fiber expansion and accelerated 4G/4G+ network investment program is putting us in a prime position to return quickly to sustainable growth.

Altice Portugal with MEO returning to growth for the first time since 2008 allows us to continue to invest to reach the whole country with fiber services by 2020.

All of which shows Altice is able to achieve efficiency savings, invest massively and grow at the same time which we will continue to focus on across the whole Group."

November 10, 2016: Altice N.V. (Euronext: ATC NA and ATCB NA), today announces financial and operating results for the quarter ended September, 2016.

All major markets contributing to improvement in Altice's financial performance in Q3

• Altice N.V. Group Revenue €5,889m, flat 0.0% YoY:
  • €2,802m France (SFR) Revenue, down 2.4%.
  • €1,442m US (Optimum) Revenue, up 2.2% on a reported basis; increase of 2.7% on a CC basis to $1,610m in local currency.
  • €578m US (Suddenlink) Revenue, up 6.2% on a reported basis; increase of 6.7% on a CC basis to $646m in local currency.
  • €1,069m Altice International Revenue, down 1.1%.
• Altice N.V. Group Adjusted EBITDA €2,326m, up 8.3% YoY:
  • €1,041m France (SFR) Adjusted EBITDA, up 0.6%. 
  • €516m US (Optimum) Adjusted EBITDA, up 32.5% on a reported basis; increase of 33.1% on a CC basis to $576m in local currency.
  • €268m US (Suddenlink) Adjusted EBITDA, up 20.2% on a reported basis; increase of 20.8% on a CC basis to $300m in local currency.
  • €489m Altice International Adjusted EBITDA, down 3.1%.
• Altice N.V. Group Adjusted EBITDA margin expanded by 3.0% pts YoY to 39.5%:
  • France (SFR) margin increased by 1.1% pts to 37.1% due to ongoing efficiencies programs.
  • US (Optimum) margin expanded by 8.2% pts to 35.8%.
  • US (Suddenlink) margin expanded by 5.4% pts to 46.4%.
  • Altice International margin decreased by 0.9% pts to 45.7%;
• Altice N.V. Group Operating Free Cash Flow of €1,377m, up 13.6% YoY; up 13.9% on a CC basis.

Contacts

Chief Investor Relations Officer
Nick Brown: +41 79 720 1503 / nick.brown@altice.net

Chief Communications Officer
Arthur Dreyfuss: +41 79 946 4931 / arthur.dreyfuss@altice.net

Conference call details

The company will host a conference call and webcast today to discuss the results at 7.30pm CET (6.30pm UK time, 1.30pm EST)

Webcast live: http://edge.media-server.com/m/p/jvcurypz

Dial-in access telephone numbers:

France: +33 1 76 77 22 75

UK: +44 203 043 2002

USA: +1 719 325 2202

Confirmation Code: 3128600

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