Achieved full-year 2023 guidance (as updated) including
operating company targets and Distributable Cash Flow (before
unanticipated tax payment)
Delivered stable to growing revenue across our FMC operations
for the full year despite continued headwinds from competition and
cost of living challenges, and supported by pricing adjustments and
momentum in mobile
Repurchased 18.5% of total shares outstanding from the
beginning of 2023 through end of January 2024
Year-end investor call to include Strategy Update on value
creation and capital allocation
Liberty Global Ltd. today announced its Q4 2023 financial
results.
CEO Mike Fries stated, “In 2023 we managed through a challenging
environment, including cost of living and inflationary pressures
and an increasingly competitive landscape for broadband, mobile and
video services. Despite that, we delivered strong Q4 and full year
results with continued postpaid momentum and an improved
performance in broadband across most markets. We successfully
executed price adjustments throughout the year, which supported
stable to growing revenues across our FMC markets in 2023, and
achieved our operating company guidance metrics for the full year
as updated at Q3. Our Full Company1 Distributable Cash Flow result
was impacted by a U.S. litigation-related cash tax payment of $315
million which was not anticipated in 2023, but excluding this item
we exceeded our Distributable Cash Flow guidance of $1.6 billion
for the year. After repurchasing 18.5% of our stock through January
2024, our share count has been reduced to 378 million shares
outstanding and, with over $4 billion(i) in cash and liquid
securities, our balance sheet remains in great shape.
“In Q4 we delivered postpaid growth across all of our core FMC
operations and over 80,000 aggregate2 net adds. Our flanker brand
strategies supported growth at VMO2 and Sunrise, and VodafoneZiggo
delivered strong postpaid growth despite the price rise in October.
At Telenet, overall results continued to be modestly impacted by
the IT platform migration issues, but the return to postpaid growth
in Q4 was driven by renewed FMC campaigns and targeted hardware
offers. The sequential improvement in our broadband performance
across most markets in the face of continued competition was
positively impacted by our speed differentiation and commercial
initiatives and, despite headwinds in fixed, the pricing actions
taken during the year supported stable to growing ARPUs across the
group in Q4. On the financial front, we reported quarterly revenue
growth at VodafoneZiggo, Telenet and Sunrise, as well as stable or
improved sequential Adjusted EBITDA performance across all of our
core FMC operations.
“We made significant progress on our fixed network strategies in
2023. With almost 32 million aggregate3 homes capable of delivering
gigabit speeds, including those on the nexfibre network, we're
investing heavily to further expand our reach to 38 million homes3
by 2026 through new build and wholebuy structures. At the end of
2023, VMO2 passed over 4 million FTTH homes, including those on the
nexfibre network, and is targeting the addition of approximately 2
million FTTH homes in 2024, with nexfibre planning to invest £1
billion over the year. In Belgium, 2023 marked the launch of
Telenet's Wyre NetCo partnership with Fluvius, which will ramp up
its fiber rollout in 2024, and we're excited to launch our FMC
offerings in Wallonia later this year.
“We look forward to providing a strategic update on how we plan
to crystallize and deliver value over time as part of tomorrow's
extended fourth quarter and full-year results call."
(i)
Including amounts held under separately managed accounts (SMAs)
and our investments in ITV, Lionsgate, Vodafone and All3Media.
Q4 Operating Company Highlights
Sunrise (Consolidated)
Sunrise delivered strong mobile performance and continued
momentum in flanker brands, with lower costs to capture spend
further supporting Adjusted EBITDA growth in Q4; Achieved 2023
financial guidance
Operating highlights: In Q4,
Sunrise continued to drive commercial momentum in mobile,
delivering 25,100 postpaid net adds. The sequential improvement in
broadband performance, which was flat in Q4, was supported by
strong Q4 sales despite a delay in activations, as well as
continued momentum in its secondary brand, yallo. FMC penetration
remains high at 58% across the Sunrise broadband base.
Financial highlights: Revenue of
$897.5 million in Q4 2023 increased 11.7% YoY on a reported basis
and 2.5% on a rebased4 basis. The rebased increase was largely
driven by (i) growth in mobile subscription revenue, (ii) a
favorable phasing impact in mobile non-subscription revenue, (iii)
continued trading momentum in flanker brands and B2B and (iv) the
positive impact of the July price increase. Adjusted EBITDA
increased 16.1% YoY on a reported basis and 5.6% on a rebased basis
to $287.4 million in Q4 2023, including $5 million of costs to
capture5. The rebased increase was mainly due to (i) the
aforementioned increase in revenue and (ii) lower costs to capture.
Adjusted EBITDA less P&E Additions of $107.8 million in Q4
increased 73.6% YoY on a reported basis and 55.4% on a rebased
basis, including $18 million of opex and capex costs to
capture.
Telenet (Consolidated)
2023 guidance achieved across all metrics despite
macroeconomic and competitive backdrop
Operating highlights: Telenet
delivered a sequential improvement in net adds performance in Q4,
with a return to positive growth in the postpaid mobile base, with
1,900 net adds, and a net loss of 5,200 broadband customers. The
improved performance during the quarter was largely driven by
Telenet's latest marketing campaigns, including the Unlimited ONE
campaign and targeted hardware promotions, while churn remains
elevated due to the competitive environment and the continued
impact of the IT platform migration issues encountered throughout
2023. As of the end of 2023, Wyre, Telenet's NetCo partnership with
Fluvius, had started construction on over 100,000 fiber homes.
Build will further accelerate in 2024 in order to reach a peak
rollout of ~450,000 homes per annum as of 2025 as previously
communicated. FMC penetration remains high at 49% of the broadband
base.
Financial highlights: Revenue of
$792.5 million in Q4 2023 increased 8.8% YoY on a reported basis
and 1.8% on a rebased basis. The rebased increase was primarily
driven by (i) an increase in B2B revenue and (ii) higher mobile
subscription revenue due to the June price increase and growth in
postpaid net adds. Adjusted EBITDA increased 3.1% on a reported
basis and decreased 3.0% on a rebased basis to $326.5 million in
Q4. The rebased decrease was primarily driven by (a) higher
staff-related expenses following the mandatory 11% wage indexation,
(b) higher energy costs and (c) higher costs for outsourced call
centers linked to IT platform migration issues, partially offset by
the aforementioned revenue increase. Reported and rebased Adjusted
EBITDA less P&E Additions decreased 28.1% and 31.6%,
respectively, to $92.0 million in Q4.
VMO2 (Non-consolidated Joint Venture)
VMO2 increases customers, fiber and 5G reach as strong
integration execution drives Adjusted EBITDA growth
Operating highlights: VMO2's fixed
customer base grew by 2,600 in Q4, driven by 9,500 broadband net
adds. Postpaid mobile also continued to grow, delivering 19,000 net
adds in Q4. The average download speed across the company's
broadband base increased 19% YoY to 358Mbps, approximately 5x
higher than the national average. VMO2's gigabit fixed network
reached the milestone of 17 million premises at the end of 2023,
including those premises on VMO2's network as well as those passed
by nexfibre. Across 2023, through a mix of the continued upgrade of
VMO2’s own network and expansion of the nexfibre network, VMO2
expanded its fiber footprint by 833,100, bringing its total fiber
reach to over 4 million homes. In mobile, VMO2 reached the target
of 50% U.K. outdoor 5G population coverage. 2023 absolute synergy
delivery was approximately two thirds of the £540 million run-rate,
significantly accelerating delivery timelines.
Financial highlights (in U.S.
GAAP)6: Revenue11 of $3,516.1 million in Q4 2023 increased
9.4% YoY on a reported basis and decreased 2.0% YoY on a rebased
basis. The rebased decrease was primarily due to the net effect of
(i) a decrease in mobile revenue driven by lower handset revenue
and (ii) an increase in B2B revenue, with each revenue category as
defined and reported by the VMO2 JV. Q4 Adjusted EBITDA11 increased
14.2% YoY on a reported basis and 6.6% YoY on a rebased basis to
$1,195.7 million, including $31 million of opex costs to capture.
The YoY increase in Adjusted EBITDA was primarily due to (a)
consumer price rises, (b) the realization of synergies and (c) a
reduction in costs of $19 million in 2023 due to a change in the
contract terms of services provided by a related-party. Q4 Adjusted
EBITDA less P&E Additions11 increased 110.9% YoY on a reported
basis and 23.3% YoY on a rebased basis to $665.9 million, including
$55 million of opex and capex costs to capture.
Financial highlights (in IFRS):
Revenue of £2,830.7 million ($3,516.1 million) on a reported basis
in Q4 2023 increased 3.8% YoY on an FX neutral basis and decreased
2.0% YoY on a rebased basis. Q4 Adjusted EBITDA of £1,063.4 million
($1,320.9 million) on a reported basis, including costs to capture,
increased 8.9% YoY on an FX neutral basis and 7.8% YoY on a rebased
basis. Q4 Adjusted EBITDA less P&E Additions of £564.7 million
($701.6 million) on a reported basis increased 74.5% YoY on an FX
neutral basis and 16.8% YoY on a rebased basis. The drivers of
these IFRS changes are largely consistent with those under U.S.
GAAP detailed above.
2024 Guidance (in IFRS, as guided by the
VMO2 JV, with the exception of Adjusted FCF)(ii): Expect to
deliver stable to declining revenue and low to mid-single-digit
Adjusted EBITDA decline (each excluding nexfibre, as defined and
reported by the VMO2 JV). Expect revenue pressure from B2B fixed
and opex investment into future growth drivers including Off-net.
Expect P&E additions of £2.0 to £2.2 billion (excluding ROU
additions). Expect Adjusted FCF of around £500 million and cash
distributions to shareholders of ~£850 million, supported by CTIL
proceeds.
For more information regarding the VMO2 JV, including full IFRS
disclosures, please visit its investor relations page to access the
Q4 earnings release.
(ii)
U.S. GAAP guidance for the VMO2 JV cannot be provided without
unreasonable efforts, as the VMO2 JV reports under IFRS and does
not have U.S. GAAP forecasts for all components of their IFRS
guidance. Quantitative reconciliations to net earnings/loss
(including net earnings/loss growth rates) and cash flow from
operating activities for the VMO2 JV's Adjusted EBITDA and Adjusted
FCF guidance cannot be provided without unreasonable efforts as
they do not forecast (i) certain non-cash charges including: the
components of non-operating income/expense, depreciation and
amortization and impairment, restructuring and other operating
items included in net earnings/loss, nor (ii) specific changes in
working capital that impact cash flows from operating activities.
The items they do not forecast may vary significantly from period
to period.
VodafoneZiggo (Non-consolidated Joint Venture)
VodafoneZiggo achieves all 2023 guidance and delivers strong
revenue growth in Q4
Operating highlights: VodafoneZiggo
continues to drive momentum in mobile and convergence, as FMC
households7 grew by 7,000 in Q4 and FMC net adds increased by 9,700
in Q4 to almost 2.7 million, delivering significant Net Promoter
Scores along with customer loyalty benefits. FMC penetration
increased from 46% to 48% YoY. Mobile postpaid net adds grew 40,300
alongside growth in mobile postpaid ARPU of 3.3% YoY, primarily
driven by the price indexation implemented in October. The
broadband base contracted by 26,500 net adds in the quarter, as a
31,200 decline in Consumer was only partially offset by a 4,700
increase in B2B. Consumer fixed ARPU increased 3.7% YoY as a result
of the price increase implemented in July.
Financial highlights: Revenue
increased 10.1% YoY on a reported basis and 4.5% YoY on a rebased
basis to $1,153.5 million in Q4. The rebased increase was primarily
due to (i) growth in mobile, driven by growth in the customer base
and the October price increase, and (ii) growth in B2B fixed.
Adjusted EBITDA increased 2.0% YoY on a reported basis and
decreased 3.2% on a rebased basis to $497.8 million in Q4. The
rebased decrease was primarily driven by higher energy and wage
costs related to inflation, partially offset by growth in sales
margins. Reported and rebased Adjusted EBITDA less P&E
Additions increased 42.7% and 33.1%, respectively, to $245.8
million in Q4.
Q4 ESG Highlights
2023 has marked a transformational year for our ESG agenda. This
year saw the launch of our new strategy, People Planet Progress,
adding to the impactful Belonging agenda - where we are creating a
culture that is inclusive, where everyone is valued and respected,
and where we have a positive impact on each other and our
communities.
Our People priorities mean that we strive to be an
inclusive company for our employees through our Belonging agenda,
creating positive connections every day so that we all Belong. In
our communities our focus on Digital Inclusion and Tomorrow's
Workforce means we are working to enhance inclusive connectivity
and the digital skills needed equitably in broader society. In Q4,
several of our operations increased their offering and availability
of services to financially vulnerable customers. VodafoneZiggo, in
collaboration with the Alliantie Digitaal Samenleven, NLdigital,
and other partners, launched a trial Digital Participation Package,
while VMO2 enhanced their inclusive connectivity by leveraging
company-owned stores to become National Digital Inclusion Hubs.
Our Planet agenda reflects our commitment to the
environment and efforts to be a sustainable company. Here, we are
working across our entire footprint to reduce our Scope 1, 2 and 3
emissions. Throughout our company we are striving to be more energy
efficient, while ensuring the energy we do use comes from renewable
energy sources. We are working to enhance network efficiency
through AI and other technologies, we are working to electrify our
fleet, and we are focused on the energy efficiency and circularity
of the products we offer. Furthermore, we are actively working
across our supply chain to encourage our partners to commit to
decarbonization.
On Progress, our priorities underpin our commitment to
transparency and responsibility, corporate responsibility and
contributing to the advancement of wider social impact and
sustainability goals. In Q4 we joined the UN Global Compact (UNGC),
where we can assure our agenda helps to progress UN Sustainable
Development Goals. We recently became members of the Joint Alliance
for CSR (JAC) - the international association of telecom operators
dedicated to developing and assessing Corporate Social
Responsibility (CSR) standards across the industry's supply chain.
Additionally, VodafoneZiggo was awarded a gold medal from EcoVadis,
an authority in business sustainability ratings. This achievement
positions VodafoneZiggo among the top 5% of best-performing
companies and underscores its ongoing commitment to a fair and
sustainable supply chain, achieved through close collaboration with
suppliers.
Liberty Global Consolidated Q4 Highlights
- Q4 revenue(i) increased 4.3% YoY on a reported basis and
decreased 1.8% on a rebased basis to $1,920.5 million
- Q4 earnings (loss) from continuing operations increased 25.9%
YoY on a reported basis to ($3,471.7 million)
- Q4 Adjusted EBITDA(i) decreased 8.6% YoY on a reported basis
and decreased 12.0% on a rebased basis to $546.0 million
- Q4 property & equipment additions(i) were 24.5% of revenue,
as compared to 27.1% in Q4 2022
- Balance sheet with $5.3 billion of total liquidity8
- Comprised of $1.4 billion of cash, $2.3 billion of investments
held under SMAs and $1.6 billion of unused borrowing capacity9
- Blended, fully-swapped borrowing cost of 3.4% on a debt balance
of $15.9 billion
Liberty Global
Q4 2023
Q4 2022
YoY Change (reported)
YoY Change (rebased)
YTD 2023
YoY Change (reported)
YoY Change (rebased)
Customers
Organic customer net losses
(29,600
)
(6,700
)
(114,500
)
Financial
(in millions, except percentages)
Revenue(i)
$
1,920.5
$
1,841.9
4.3
%
(1.8
%)
$
7,491.4
4.1
%
(1.5
%)
Earnings (loss) from continuing
operations(i)
$
(3,471.7
)
$
(4,684.3
)
25.9
%
$
(3,873.8
)
(450.5
%)
Adjusted EBITDA(i)
$
546.0
$
597.3
(8.6
%)
(12.0
%)
$
2,369.6
(8.7
%)
(10.8
%)
P&E additions(i)
$
470.3
$
499.3
(5.8
%)
$
1,578.0
(0.7
%)
Adjusted EBITDA less P&E
Additions(i)
$
75.7
$
98.0
(22.8
%)
(10.4
%)
$
791.6
(21.4
%)
(19.6
%)
Cash provided by operating activities
$
839.2
$
883.2
(5.0
%)
$
2,165.9
(22.3
%)
Cash used by investing activities
$
(878.6
)
$
(651.2
)
(34.9
%)
$
(1,845.0
)
(242.3
%)
Cash used by financing activities
$
(349.3
)
$
(213.4
)
(63.7
%)
$
(692.4
)
78.8
%
Full Company Adjusted FCF
$
527.6
$
439.1
20.2
%
$
575.6
(50.0
%)
Full Company Distributable Cash Flow
$
527.6
$
650.1
(18.8
%)
$
1,390.8
(14.6
%)
______________________
(i)
As further described in footnote (ii) to the revenue table in
our P&L Discussion below, 2023 amounts are impacted by the
strategic and operational changes to our T&I Function as a
result of our determination to outsource a component of our T&I
Function and market certain of our internally-developed software to
third parties. As a result, from May 2023, proceeds from the
licensing and related sale of products from our
internally-developed software have been applied against the net
book value of our existing internally-developed capitalized
software until that balance is reduced to zero. Accordingly, during
the three months and year ended December 31, 2023, revenue,
Adjusted EBITDA and Adjusted EBITDA less P&E Additions exclude
the benefit of $35.5 million and $127.7 million, respectively, that
otherwise would have been reported in such metrics impacting both
our consolidated and Central and Other results. As a result,
Adjusted EBITDA and Adjusted EBITDA less P&E Additions are
comparatively lower in the current periods, however, Adjusted FCF
is unaffected. As of December 31, 2023, the net book value of our
existing internally-developed software was reduced to zero.
Customer Growth
Three months ended
Year ended
December 31,
December 31,
2023
2022
2023
2022
Organic customer net additions (losses)
by market
Sunrise
(12,200
)
2,800
(29,100
)
(4,000
)
Telenet(i)
(12,600
)
(5,900
)
(61,900
)
(23,500
)
VM Ireland
(3,900
)
(2,900
)
(18,300
)
(10,700
)
UPC Slovakia
(900
)
(700
)
(5,200
)
(6,300
)
Total
(29,600
)
(6,700
)
(114,500
)
(44,500
)
VMO2 JV(ii)
2,600
15,500
31,300
27,200
VodafoneZiggo JV(iii)
(47,200
)
(5,300
)
(123,200
)
(62,600
)
______________________
(i)
The 2023 amounts include our business in
Luxembourg as a result of Telenet's January 2023 acquisition of
Eltrona.
(ii)
Fixed-line customer counts for the VMO2 JV
exclude Upp customers.
(iii)
Fixed-line customer counts for the
VodafoneZiggo JV include certain B2B customers.
Earnings (Loss) from Continuing Operations
Earnings (loss) from continuing operations was ($3,471.7
million) and ($4,684.3 million) for the three months ended December
31, 2023 and 2022, respectively, and ($3,873.8 million) and
$1,105.3 million for the years ended December 31, 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 (our T&I 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)
Year ended
Increase/(decrease)
December 31,
December 31,
Revenue
2023
2022(i)
Reported %
Rebased %
2023
2022(i)
Reported %
Rebased %
in millions, except %
amounts
Sunrise
$
897.5
$
803.6
11.7
2.5
$
3,380.4
$
3,180.9
6.3
(0.2
)
Telenet
792.5
728.7
8.8
1.8
3,089.2
2,807.3
10.0
1.3
VM Ireland
133.7
129.3
3.4
(1.8
)
506.1
494.7
2.3
(0.4
)
Central and Other(ii)
160.7
239.7
(33.0
)
(29.4
)
775.7
959.9
(19.2
)
(14.8
)
Intersegment eliminations(iii)
(63.9
)
(59.4
)
N.M.
N.M.
(260.0
)
(247.1
)
N.M.
N.M.
Total
$
1,920.5
$
1,841.9
4.3
(1.8
)
$
7,491.4
$
7,195.7
4.1
(1.5
)
VMO2 JV(iv)
$
3,516.1
$
3,214.5
9.4
(2.0
)
$
13,574.1
$
12,857.2
5.6
—
VodafoneZiggo JV(iv)
$
1,153.5
$
1,047.3
10.1
4.5
$
4,450.5
$
4,284.6
3.9
1.2
______________________
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)
As further described in note 19 to our
10-K, as a result of our determination to market and sell certain
of our internally-developed software to third parties, 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 until that balance was
reduced to zero. Accordingly, during the three months and year
ended December 31, 2023, revenue, Adjusted EBITDA and Adjusted
EBITDA less P&E Additions exclude the benefit of $35.5 million
and $127.7 million, respectively, 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
periods, however, Adjusted FCF is unaffected. As of December 31,
2023, the net book value of our existing internally-developed
software was reduced to zero. Further, we now expense the costs of
development of such software due to the fact that it is now
externally marketed 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)
Year ended
Increase/(decrease)
December 31,
December 31,
Adjusted EBITDA
2023
2022(i)
Reported %
Rebased %
2023
2022(i)
Reported %
Rebased %
in millions, except %
amounts
Sunrise
$
287.4
$
247.5
16.1
5.6
$
1,148.5
$
1,097.8
4.6
(2.0
)
Telenet
326.5
316.7
3.1
(3.0
)
1,315.2
1,299.6
1.2
(1.2
)
VM Ireland
46.7
41.7
12.0
6.1
181.4
183.6
(1.2
)
(3.7
)
Central and Other(ii)
(99.4
)
6.0
N.M.
N.M.
(214.7
)
74.7
N.M.
N.M.
Intersegment eliminations(iii)
(15.2
)
(14.6
)
N.M.
N.M.
(60.8
)
(60.3
)
N.M.
N.M.
Total
$
546.0
$
597.3
(8.6
)
(12.0
)
$
2,369.6
$
2,595.4
(8.7
)
(10.8
)
VMO2 JV(iv)
$
1,195.7
$
1,047.0
14.2
6.6
$
4,531.3
$
4,562.2
(0.7
)
3.4
VodafoneZiggo JV(iv)
$
497.8
$
487.9
2.0
(3.2
)
$
1,972.5
$
2,018.0
(2.3
)
(4.8
)
______________________
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 T&I Function 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)
Year ended
Increase/(decrease)
Adjusted EBITDA less P&E
Additions
December 31,
December 31,
2023
2022(i)
Reported %
Rebased %
2023
2022(i)
Reported %
Rebased %
in millions, except %
amounts
Sunrise
$
107.8
$
62.1
73.6
55.4
$
562.1
$
499.9
12.4
5.9
Telenet
92.0
128.0
(28.1
)
(31.6
)
568.6
656.6
(13.4
)
(14.0
)
VM Ireland
(2.0
)
(14.7
)
(86.4
)
87.2
4.7
36.2
(87.0
)
(86.6
)
Central and Other(ii)
(122.1
)
(77.4
)
(57.8
)
(16.9
)
(343.8
)
(185.2
)
(85.6
)
(40.6
)
Intersegment eliminations
—
—
N.M.
N.M.
—
(1.0
)
N.M.
N.M.
Total
$
75.7
$
98.0
(22.8
)
(10.4
)
$
791.6
$
1,006.5
(21.4
)
(19.6
)
VMO2 JV(iii)
$
665.9
$
315.7
110.9
23.3
$
2,052.4
$
1,777.2
15.5
(6.4
)
VodafoneZiggo JV(iii)
$
245.8
$
172.3
42.7
33.1
$
982.7
$
1,018.7
(3.5
)
(6.0
)
______________________
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 T&I Function 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: $15.9 billion
- Average debt tenor10: 4.9 years,
with ~47% not due until 2029 or thereafter
- Borrowing costs: Blended,
fully-swapped cost of debt was 3.4%
- Liquidity: $5.3 billion, including
(i) $1.4 billion of cash at December 31, 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 2024 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; any distributions or payments to be received from our
joint ventures; the timing of any strategic updates that we may
provide; our and our affiliates' and joint ventures' plans with
respect to network products and services; expectations with respect
to new build and wholebuy homes to be reached; expectations with
respect to the number of FTTH homes to be passed by VMO2 and
nexfibre, including the cost, timing and benefits to be derived
therefrom; our strategic plans for our ventures portfolio,
including expected capital rotation; our planned non-core asset
dispositions during 2024; our commitments and aspirations with
respect to ESG through our People Planet Progress strategy; our
anticipated investments in our infrastructure, products and
networks, including the continuing rollout of fiber in Belgium
through Wyre; the anticipated launch of certain FMC offerings in
Wallonia in 2024, including the anticipated timing and benefits to
be derived therefrom; 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; 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. 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
Our original share buyback plan for 2023 authorized the
repurchase of 10% of our outstanding shares as of December 31,
2022, and this was increased to a minimum of 15% in July 2023. As
of October 30, 2023, we completed our 15% buyback target and
further expanded our program to repurchase shares through the end
of January 2024 in the amount of approximately $300.0 million,
which was successfully completed.
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. Our businesses operate under some of the
best-known consumer brands, including Sunrise in Switzerland,
Telenet in Belgium, Virgin Media in Ireland, UPC in Slovakia,
Virgin Media-O2 in the U.K. and VodafoneZiggo in The Netherlands.
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.
Liberty Global's consolidated businesses generate annual revenue
of more than $7 billion, while the VMO2 JV and the VodafoneZiggo JV
generate combined annual revenue of more than $18 billion.**
Liberty Global Ventures, our global investment arm, has a
portfolio of more than 75 companies and funds across the content,
technology and infrastructure industries, including 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 2023 Liberty Global consolidated results and the
combined as reported full year 2023 results for the VodafoneZiggo
JV and full year 2023 U.S. GAAP results for the VMO2 JV.
Sunrise, Telenet, the VMO2 JV and the VodafoneZiggo JV deliver
mobile services as mobile network operators. Virgin Media Ireland
delivers mobile services as a mobile virtual network operator
through third-party networks. UPC Slovakia delivers mobile services
as a reseller of SIM cards.
Liberty Global Ltd. is listed on the Nasdaq Global Select Market
under the symbols "LBTYA", "LBTYB" and "LBTYK".
For more information, please visit www.libertyglobal.com.
Balance Sheets, Statements of Operations and Statements of
Cash Flows
The consolidated balance sheets, statements of operations and
statements of cash flows of Liberty Global are in our 10-K.
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 months and year ended
December 31, 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 months and year
ended December 31, 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 months and year ended December 31, 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 months and year ended December 31, 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 months and year ended December 31, 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 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 December
31, 2022
Year ended December 31,
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)
$
(11.9
)
$
(19.2
)
$
(23.6
)
$
99.9
$
(56.1
)
$
(70.2
)
Foreign currency
125.7
42.4
10.1
307.3
116.1
48.8
Total
$
113.8
$
23.2
$
(13.5
)
$
407.2
$
60.0
$
(21.4
)
VMO2 JV(ii):
Acquisitions and dispositions(iii)
$
4.5
$
0.1
$
0.1
$
(16.3
)
$
(265.6
)
$
(265.6
)
nexfibre construction revenue(iv)
197.1
13.6
13.6
675.1
51.6
51.6
nexfibre construction P&E
additions(iv)
—
—
186.4
—
—
611.0
Foreign currency
173.5
61.4
24.1
64.1
32.0
17.7
Total
$
375.1
$
75.1
$
224.2
$
722.9
$
(182.0
)
$
414.7
VodafoneZiggo JV(ii):
Foreign currency
$
56.0
$
26.5
$
12.4
$
115.0
$
55.0
$
27.0
______________________
(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 December 31, 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
$
498.6
$
2,276.1
$
—
$
2,774.7
Telenet
910.0
—
713.7
1,623.7
Sunrise Holding (formerly UPC Holding)
6.6
—
802.2
808.8
VM Ireland
0.7
—
110.6
111.3
Total
$
1,415.9
$
2,276.1
$
1,626.5
$
5,318.5
______________________
(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 December 31, 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
Sunrise Holding
$
6,492.0
$
32.3
$
6,524.3
$
775.3
$
7,299.6
Telenet
6,961.1
4.1
6,965.2
(59.4
)
6,905.8
VM Ireland
995.8
—
995.8
—
995.8
Other(iii)
1,408.7
21.6
1,430.3
—
1,430.3
Total
$
15,857.6
$
58.0
$
15,915.6
$
715.9
$
16,631.5
______________________
(i)
Except as otherwise indicated, the amounts
reported in the table include the named entity and its
subsidiaries.
(ii)
Debt amounts for Sunrise Holding include
notes issued by special purpose entities that are consolidated by
Sunrise Holding.
(iii)
Debt amount includes a loan of $1,391.9
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 consolidated
statements of cash flows in our 10-K.
Three months ended
Year ended
December 31,
December 31,
2023
2022
2023
2022
in millions, except %
amounts
Customer premises equipment (CPE)
$
56.0
$
62.2
$
257.9
$
262.0
New build & upgrade
161.8
46.1
306.4
128.5
Capacity
16.0
95.2
161.8
242.2
Baseline
138.4
152.7
472.7
486.3
Product & enablers
98.1
143.1
379.2
469.9
Total P&E additions
470.3
499.3
1,578.0
1,588.9
Reconciliation of P&E additions to
capital expenditures:
Assets acquired under capital-related
vendor financing arrangements(i)
(48.5
)
(39.9
)
(178.4
)
(182.8
)
Assets acquired under finance leases
(0.1
)
(8.4
)
(20.9
)
(34.2
)
Changes in current liabilities related to
capital expenditures
(51.9
)
(77.1
)
7.3
(68.7
)
Total capital expenditures, net(ii)
$
369.8
$
373.9
$
1,386.0
$
1,303.2
P&E additions as % of revenue
24.5
%
27.1
%
21.1
%
22.1
%
______________________
(i)
Amounts exclude related VAT of $3.6 million and $4.2 million for
the three months ended December 31, 2023 and 2022, respectively,
and $18.4 million and $21.2 million for the years ended December
31, 2023 and 2022, respectively, that were also financed under
these arrangements.
(ii)
The capital expenditures that we report in our 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 December
31,
Increase/(decrease)
2023
2022
Reported %
Rebased %
Liberty Global
$
66.63
$
61.96
7.5
%
1.5
%
VM Ireland
€
62.81
€
62.20
1.0
%
1.0
%
Telenet
€
62.09
€
60.22
3.1
%
4.1
%
Sunrise Holding
€
61.45
€
60.84
1.0
%
(1.4
%)
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 December
31,
Increase/(decrease)
2023
2022
Reported %
Rebased %
Liberty Global:
Including interconnect revenue
$
26.86
$
25.25
6.4
%
(1.0
%)
Excluding interconnect revenue
$
25.08
$
23.02
8.9
%
1.3
%
Operating Data — December 31,
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:
Sunrise(v)
2,707,700
1,468,000
1,180,400
1,199,700
934,200
3,314,300
2,467,100
2,836,300
Telenet(vi)
3,613,400
2,007,500
1,730,400
1,657,700
934,200
4,322,300
2,677,300
2,910,500
VM Ireland
982,900
402,800
368,500
227,900
205,800
802,200
134,400
134,400
UPC Slovakia
642,400
177,200
144,800
161,700
87,500
394,000
—
—
Total Liberty Global
7,946,400
4,055,500
3,424,100
3,247,000
2,161,700
8,832,800
5,278,800
5,881,200
VMO2 JV(vii)
16,198,400
5,826,800
5,717,600
12,706,400
16,122,300
35,216,300
VodafoneZiggo JV(viii)
7,516,600
3,553,000
3,207,100
3,524,700
1,521,100
8,252,900
5,301,800
5,642,000
Subscriber Variance Table —
December 31, 2023 vs. September 30, 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:
Sunrise(v)
7,000
(12,200
)
—
(16,900
)
(17,800
)
(34,700
)
25,100
(3,100
)
Telenet(vi)
9,500
(12,600
)
(5,200
)
(23,100
)
(23,100
)
(51,400
)
1,900
(7,800
)
VM Ireland
3,600
(3,900
)
(3,000
)
(6,000
)
(15,500
)
(24,500
)
(2,200
)
(2,200
)
UPC Slovakia
2,000
(900
)
(400
)
(700
)
(400
)
(1,500
)
—
—
Total Liberty Global
22,100
(29,600
)
(8,600
)
(46,700
)
(56,800
)
(112,100
)
24,800
(13,100
)
Q4 2023 Liberty
Global Adjustments:
VM Ireland
8,300
—
—
—
—
—
—
—
Total adjustments
8,300
—
—
—
—
—
—
—
VMO2 JV(vii)
1,300
2,600
9,500
(92,600
)
19,000
150,700
VodafoneZiggo JV(viii)
49,500
(47,200
)
(26,500
)
(48,800
)
(71,900
)
(147,200
)
40,300
43,900
Footnotes for Operating Data and
Subscriber Variance Tables
(i)
At Sunrise, we offer a 10 Mbps internet service to our Video
Subscribers without an incremental recurring fee. Our Internet
Subscribers at Sunrise include approximately 39,800 subscribers who
have requested and received this service.
(ii)
We have approximately 31,000 “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)
At Sunrise, we offer a basic phone service
to our Video Subscribers without an incremental recurring fee. Our
Telephony Subscribers at Sunrise include approximately 128,400
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 December 31, 2023, our mobile subscriber count included
approximately 369,200, 233,200, 7,617,900 and 340,200 prepaid
mobile subscribers at Sunrise, Telenet, 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 9,644,900
that are included in the total mobile subscriber count as defined
and presented by the VMO2 JV.
(v)
Pursuant to service agreements, Sunrise
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 Sunrise's homes passed count as we do not own these
networks. Including these arrangements, our operations at Sunrise
have the ability to offer fixed services to the national
footprint.
(vi)
Includes our business in Luxembourg as a
result of Telenet's January 2023 acquisition of Eltrona.
(vii)
Fixed-line customer counts for the VMO2 JV
exclude Upp customers.
(viii)
Fixed-line counts for the VodafoneZiggo JV
include certain B2B customers and 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
- The term "Full Company" includes certain amounts that were
classified as discontinued operations prior to disposal. We present
Full Company Adjusted Free Cash Flow and Full Company Distributable
Cash Flow as applicable for those periods impacted by discontinued
operations.
- Represents aggregate consolidated and 50% owned
non-consolidated VMO2 JV and VodafoneZiggo JV homes passed,
broadband subscribers or postpaid mobile subscribers, as
applicable. Aggregate subscribers also includes certain B2B fixed
subscribers of the VodafoneZiggo JV.
- Represents aggregate consolidated and 50% owned
non-consolidated VMO2 JV and VodafoneZiggo JV homes passed.
Includes those homes passed on the nexfibre partner network, which
the VMO2 JV has access to and acts as an anchor tenant, and certain
homes passed through whole buy.
- The indicated growth rates are rebased for acquisitions,
dispositions, FX and other items that impact the comparability of
our year-over-year results. See the Rebase Information section for
more information on rebased growth.
- 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.
- This release includes the actual U.S. GAAP results for the VMO2
JV for the three months and year ended December 31, 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 Q4 earnings release.
- 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.
- 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.
- 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 December 31, 2023 compliance reporting requirements for
our credit facilities, and assuming no further changes from
quarter-end borrowing levels, we anticipate that the full unused
borrowing capacity will continue to be available under each of the
respective subsidiary facilities. Our above expectations do not
consider any actual or potential changes to our borrowing levels or
any amounts loaned or distributed subsequent to December 31,
2023.
- 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.
- 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 December
31,
Year ended December
31,
2023
2022
2023
2022
in millions
Revenue:
U.S. GAAP revenue
$
3,516.1
$
3,214.5
$
13,574.1
$
12,857.2
Rebase adjustments(i)
2.7
201.6
13.1
658.8
U.S. GAAP rebased revenue
3,518.8
3,416.1
13,587.2
13,516.0
U.S. GAAP/IFRS adjustments
—
—
—
—
IFRS rebased revenue
3,518.8
3,416.1
13,587.2
13,516.0
Rebase adjustments(i)
(2.7
)
(201.6
)
(13.1
)
(658.8
)
IFRS revenue
$
3,516.1
$
3,214.5
$
13,574.1
$
12,857.2
Adjusted EBITDA:
U.S. GAAP Adjusted EBITDA
$
1,195.7
$
1,047.0
$
4,531.3
$
4,562.2
Rebase adjustments(ii)
2.0
13.7
7.8
(214.0
)
U.S. GAAP rebased Adjusted EBITDA
1,197.7
1,060.7
4,539.1
4,348.2
U.S. GAAP/IFRS adjustments(iv)
125.2
102.4
459.2
444.5
IFRS rebased Adjusted EBITDA (including
costs to capture)
1,322.9
1,163.1
4,998.3
4,792.7
Rebase adjustments(ii)
(2.0
)
(13.7
)
(7.8
)
214.0
IFRS Adjusted EBITDA
$
1,320.9
$
1,149.4
$
4,990.5
$
5,006.7
Property & equipment
additions:
U.S. GAAP P&E additions
$
529.8
$
731.3
$
2,478.9
$
2,785.0
Rebase adjustments(iii)
—
(186.4
)
—
(611.0
)
U.S. GAAP rebased P&E additions
529.8
544.9
2,478.9
2,174.0
U.S. GAAP/IFRS adjustments(iv)
89.5
40.3
272.2
194.2
IFRS rebased P&E additions (including
costs to capture)
619.3
585.2
2,751.1
2,368.2
Rebase adjustments(iii)
—
186.4
—
611.0
IFRS P&E additions
$
619.3
$
771.6
$
2,751.1
$
2,979.2
Adjusted EBITDA less P&E
additions:
U.S. GAAP Adjusted EBITDA less P&E
additions
$
665.9
$
315.7
$
2,052.4
$
1,777.2
Rebase adjustments(ii)(iii)
2.0
200.1
7.8
397.0
U.S. GAAP rebased Adjusted EBITDA less
P&E additions
667.9
515.8
2,060.2
2,174.2
U.S. GAAP/IFRS adjustments(iv)
35.7
62.1
187.0
250.3
IFRS rebased Adjusted EBITDA less P&E
additions (including costs to capture)
703.6
577.9
2,247.2
2,424.5
Rebase adjustments(ii)(iii)
(2.0
)
(200.1
)
(7.8
)
(397.0
)
IFRS Adjusted EBITDA less P&E
additions
$
701.6
$
377.8
$
2,239.4
$
2,027.5
______________________
(i)
Revenue rebase adjustments relate to (i)
for 2022, the VMO2 JV's construction agreement with the nexfibre JV
of approximately $197 million and $675 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 $14 million and $52 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 $186 million and $611 million, respectively.
(iv)
U.S. GAAP/IFRS differences primarily
relate to (i) the VMO2 JV's investment in CTIL and (ii) lease
accounting.
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 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
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
Year ended
December 31,
December 31,
2023
2022
2023
2022
in millions
Earnings (loss) from continuing
operations
$
(3,471.7
)
$
(4,684.3
)
$
(3,873.8
)
$
1,105.3
Income tax expense (benefit)
(20.4
)
109.3
149.6
318.9
Other income, net
(66.0
)
(74.2
)
(225.5
)
(134.4
)
Gain on Telenet Tower Sale
—
(0.1
)
—
(700.5
)
Gain associated with the Telenet Wyre
Transaction
—
—
(377.8
)
—
Share of results of affiliates, net
1,678.2
2,080.4
2,019.3
1,267.8
Losses (gains) on debt extinguishment,
net
1.4
—
1.4
(2.8
)
Realized and unrealized losses due to
changes in fair values of certain investments, net
212.5
116.1
557.3
323.5
Foreign currency transaction losses
(gains), net
488.7
1,779.2
70.8
(1,407.2
)
Realized and unrealized losses (gains) on
derivative instruments, net
720.1
455.7
526.3
(1,213.1
)
Interest expense
251.9
172.5
907.9
589.3
Operating income (loss)
(205.3
)
(45.4
)
(244.5
)
146.8
Impairment, restructuring and other
operating items, net
61.3
11.0
67.9
85.1
Depreciation and amortization
633.4
583.0
2,315.2
2,171.4
Share-based compensation expense
56.6
48.7
231.0
192.1
Adjusted EBITDA
546.0
597.3
2,369.6
2,595.4
Property and equipment additions
(470.3
)
(499.3
)
(1,578.0
)
(1,588.9
)
Adjusted EBITDA less P&E Additions
$
75.7
$
98.0
$
791.6
$
1,006.5
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 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 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 $3.9 million and $4.2 million during the three
months ended December 31, 2023 and 2022, respectively, and $27.7
million and $36.2 million during the year ended December 31, 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
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. 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
Year ended
December 31,
December 31,
2023
2022
2023
2022
in millions
Net cash provided by operating
activities
$
839.2
$
883.2
$
2,165.9
$
2,837.8
Operating-related vendor financing
additions(i)
204.0
125.6
648.5
529.2
Cash capital expenditures, net
(369.8
)
(373.9
)
(1,386.0
)
(1,319.0
)
Principal payments on operating-related
vendor financing
(97.9
)
(90.2
)
(568.8
)
(619.4
)
Principal payments on capital-related
vendor financing
(45.3
)
(90.1
)
(256.1
)
(215.6
)
Principal payments on finance leases
(2.6
)
(15.5
)
(27.9
)
(62.2
)
Full Company Adjusted FCF
527.6
439.1
575.6
1,150.8
Other affiliate dividends
—
211.0
815.2
477.9
Full Company Distributable Cash Flow
$
527.6
$
650.1
$
1,390.8
$
1,628.7
_______________
(i)
For purposes of our 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 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 monthly
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 December 31, 2023 (in
millions, except ratios):
Reconciliation of reported LTM net loss
to LTM Adjusted EBITDA:
Reported LTM net loss
$
(3,873.8
)
Income tax expense
149.6
Other income, net
(225.5
)
Gain associated with the Telenet Wyre
Transaction
(377.8
)
Share of results of affiliates, net
2,019.3
Loss on debt extinguishment, net
1.4
Realized and unrealized loss due to
changes in fair values of certain investments, net
557.3
Foreign currency transaction loss, net
70.8
Realized and unrealized loss on derivative
instruments, net
526.3
Interest expense
907.9
Operating loss
(244.5
)
Impairment, restructuring and other
operating items, net
67.9
Depreciation and amortization
2,315.2
Share-based compensation expense
231.0
LTM Adjusted EBITDA
$
2,369.6
Debt to reported LTM net loss and LTM
Adjusted EBITDA:
Debt and finance lease obligations before
deferred financing costs, discounts and premiums
$
15,915.6
Principal related projected derivative
cash payments
715.9
Vodafone Collar Loan
(1,391.9
)
Adjusted debt and finance lease
obligations before deferred financing costs, discounts and
premiums
$
15,239.6
Reported LTM net loss
$
(3,873.8
)
Debt to reported LTM net loss ratio
(3.9
)
LTM Adjusted EBITDA
$
2,369.6
Debt to LTM Adjusted EBITDA ratio
6.4
Net Debt to reported LTM net loss and
LTM Adjusted EBITDA:
Adjusted debt and finance lease
obligations before deferred financing costs, discounts and
premiums
$
15,239.6
Cash and cash equivalents and investments
held under SMAs
(3,692.0
)
Adjusted net debt and finance lease
obligations before deferred financing costs, discounts and
premiums
$
11,547.6
Reported LTM net loss
$
(3,873.8
)
Net debt to reported LTM net loss
ratio
(3.0
)
LTM Adjusted EBITDA
$
2,369.6
Net debt to LTM Adjusted EBITDA ratio
4.9
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) provides 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
December 31,
Year ended December
31,
2023
2022
2023
2022
in millions
Increase (decrease) to
revenue(i):
Central and Other
$
59.9
$
56.7
$
243.9
$
237.5
Intersegment eliminations
(59.9
)
(56.7
)
(243.9
)
(237.5
)
Total
$
—
$
—
$
—
$
—
Increase (decrease) to Adjusted
EBITDA(ii):
Sunrise
$
(16.7
)
$
(10.1
)
$
(65.0
)
$
(40.0
)
Telenet
(2.2
)
(2.0
)
(8.8
)
(8.5
)
VM Ireland
(5.9
)
(3.3
)
(23.9
)
(13.9
)
Central and Other
40.0
30.0
158.5
121.7
Intersegment eliminations
(15.2
)
(14.6
)
(60.8
)
(59.3
)
Total
$
—
$
—
$
—
$
—
Increase (decrease) to property and
equipment additions(iii):
Sunrise
$
5.8
$
5.5
$
22.8
$
22.2
Telenet
6.9
6.6
27.7
27.0
VM Ireland
2.5
2.5
10.3
10.1
Central and Other
—
—
—
—
Intersegment eliminations
(15.2
)
(14.6
)
(60.8
)
(59.3
)
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
December 31,
Increase/(decrease)
Year ended December
31,
Increase/(decrease)
2023
2022
Reported %
Rebased %
2023
2022(i)
Reported %
Rebased %
in millions, except %
amounts
Adjusted EBITDA:
Sunrise
$
287.4
$
247.5
16.1
5.6
$
1,148.5
$
1,097.8
4.6
(2.0
)
Telenet
326.5
316.7
3.1
(3.0
)
1,315.2
1,299.6
1.2
(1.2
)
VM Ireland
46.7
41.7
12.0
6.1
181.4
183.6
(1.2
)
(3.7
)
Central and Other
(99.4
)
6.0
N.M.
N.M.
(214.7
)
74.7
N.M.
N.M.
Intersegment eliminations(ii)
(15.2
)
(14.6
)
N.M.
N.M.
(60.8
)
(60.3
)
N.M.
N.M.
Total Adjusted EBITDA
$
546.0
$
597.3
(8.6
)
(12.0
)
$
2,369.6
$
2,595.4
(8.7
)
(10.8
)
VMO2 JV(iii)
$
1,195.7
$
1,047.0
14.2
6.6
$
4,531.3
$
4,562.2
(0.7
)
3.4
VodafoneZiggo JV(iii)
$
497.8
$
487.9
2.0
(3.2
)
$
1,972.5
$
2,018.0
(2.3
)
(4.8
)
Finance lease adjustments:
Sunrise
$
(1.2
)
$
(2.9
)
$
(5.4
)
$
(8.3
)
Telenet
(0.2
)
(18.1
)
(23.9
)
(76.5
)
Central and Other
(0.8
)
(2.1
)
(6.8
)
(8.1
)
Total finance lease adjustments
$
(2.2
)
$
(23.1
)
$
(36.1
)
$
(92.9
)
VMO2 JV(iii)
$
(1.9
)
$
(2.0
)
$
(7.9
)
$
(8.8
)
VodafoneZiggo JV(iii)
$
(2.5
)
$
(2.8
)
$
(9.9
)
$
(9.4
)
Adjusted EBITDAaL:
Sunrise
$
286.2
$
244.6
17.0
5.8
$
1,143.1
$
1,089.5
4.9
(2.0
)
Telenet
326.3
298.6
9.3
(2.9
)
1,291.3
1,223.1
5.6
0.2
VM Ireland
46.7
41.7
12.0
6.1
181.4
183.6
(1.2
)
(3.7
)
Central and Other
(100.2
)
3.9
N.M.
N.M.
(221.5
)
66.6
N.M.
N.M.
Intersegment eliminations(ii)
(15.2
)
(14.6
)
N.M.
N.M.
(60.8
)
(60.3
)
N.M.
N.M.
Total Adjusted EBITDAaL
$
543.8
$
574.2
(5.3
)
(11.8
)
$
2,333.5
$
2,502.5
(6.8
)
(10.2
)
VMO2 JV(iii)
$
1,193.8
$
1,045.0
14.2
12.8
$
4,523.4
$
4,553.4
(0.7
)
4.2
VodafoneZiggo JV(iii)
$
495.3
$
485.1
2.1
(3.2
)
$
1,962.6
$
2,008.6
(2.3
)
(4.8
)
______________________
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 (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 (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.
Appendix - Foreign Currency Information
The following table presents the relationships between the
primary currencies of the countries in which we operate and the
U.S. dollar, which is our reporting currency, per one U.S.
dollar:
December 31,
2023
2022
Spot rates:
Euro
0.9038
0.9337
Swiss franc
0.8392
0.9219
British pound sterling
0.7835
0.8265
Polish zloty
3.9272
4.3686
Three months ended
December 31,
Year ended December
31,
2023
2022
2023
2022
Average rates:
Euro
0.9291
0.9801
0.9247
0.9509
Swiss franc
0.8862
0.9637
0.8984
0.9548
British pound sterling
0.8053
0.8524
0.8042
0.8112
Polish zloty
4.1007
4.6304
4.2004
4.4555
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240215548825/en/
Investor Relations Michael Bishop +44 20 8483 6246
Corporate Communications Bill Myers +1 303 220 6686 Matt
Beake +44 20 8483 6428
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