Liberty Latin America Ltd. ("Liberty Latin America" or "LLA") (NASDAQ: LILA and LILAK, OTC Link: LILAB) today announced its financial and operating results for the three months ("Q2") and six months ("YTD" or "H1") ended June 30, 2019.
CEO Balan Nair commented, "Our second quarter performance showed further evidence of our developing operational momentum. We continued to leverage our investments in network, product and customer experience to add over 110,000 subscribers across our fixed and mobile services in Q2. In fixed services, we added 67,000 RGUs, including 44,000 new broadband subscribers underpinned by continued strong demand for our market-leading speeds. On the mobile front, we reported our second consecutive quarter of growth, adding 44,000 new subscribers. This performance was led by Jamaica, where our focus on simplicity in the "Paint Jamaica Blue" campaign showed early success."
"We are focused on enhancing broadband connectivity across our markets, and in Q2 we added or upgraded 160,000 homes, bringing the total so far this year to approximately 240,000. Product innovation is also an important element of our strategy and we successfully launched Replay TV in Puerto Rico and increased our top-speed to 600 Mbps in Chile."
"Financially, we reported rebased revenue growth of 3%, showing steady development in our fixed residential and B2B businesses, and importantly, mobile revenue stabilized on a sequential basis at Cable & Wireless. On an OCF basis, we delivered 8% rebased growth with each of our segments driving year-over-year growth. The increase in OCF, combined with reduced year-over-year capital intensity, propelled adjusted free cash flow to $68 million in Q2, or $116 million for the first half of 2019. Given our performance in H1 2019, we are raising our adjusted free cash flow target in 2019 from $125 million to $150 million."
"Capitalizing on attractive financial markets over the last four months, we pro-actively refinanced debt in our C&W credit pool, further improving our maturity profile. We also issued 2% convertible senior notes at Liberty Latin America in June, generating approximately $350 million of net proceeds. As a result, we ended Q2 with over $900 million of cash and over $1 billion of untapped revolving credit facilities."
"For the second half of 2019, we are building on our operational momentum, including further expanding our leading networks and launching innovative products for our customers. Combined with our ongoing focus on efficiency opportunities across LLA, we are confident in achieving our targets for the year."
Business Highlights
Liberty Latin America 2019 Financial Guidance - Update
Financial Highlights
Liberty Latin America |
|
Q2 2019 |
|
Q2 2018 |
|
YoY
|
|
YTD 2019 |
|
YTD 2018 |
|
YoY
|
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(in millions, except % amounts) |
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Revenue |
|
$ |
983 |
|
|
$ |
922 |
|
|
3 |
% |
|
$ |
1,926 |
|
|
$ |
1,832 |
|
|
3 |
% |
OCF |
|
$ |
387 |
|
|
$ |
353 |
|
|
8 |
% |
|
$ |
753 |
|
|
$ |
694 |
|
|
8 |
% |
Property & equipment additions |
|
$ |
166 |
|
|
$ |
218 |
|
|
(24 |
%) |
|
$ |
305 |
|
|
$ |
412 |
|
|
(26 |
%) |
As a percentage of revenue |
|
17 |
% |
|
24 |
% |
|
|
|
16 |
% |
|
22 |
% |
|
|
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|
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Operating income |
|
$ |
144 |
|
|
$ |
124 |
|
|
16 |
% |
|
$ |
257 |
|
|
$ |
223 |
|
|
15 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
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||||||||||
Adjusted FCF |
|
$ |
68 |
|
|
$ |
(14 |
) |
|
|
|
$ |
116 |
|
|
$ |
(60 |
) |
|
|
||
Cash provided by operating activities |
|
$ |
244 |
|
|
$ |
235 |
|
|
|
|
$ |
431 |
|
|
$ |
398 |
|
|
|
||
Cash used by investing activities |
|
$ |
(136 |
) |
|
$ |
(237 |
) |
|
|
|
$ |
(421 |
) |
|
$ |
(425 |
) |
|
|
||
Cash provided by financing activities |
|
$ |
281 |
|
|
$ |
235 |
|
|
|
|
$ |
320 |
|
|
$ |
223 |
|
|
|
||
* Revenue and OCF YoY growth rates are on a rebased basis. |
Subscriber Growth4
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Three months ended |
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Six months ended |
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June 30, |
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June 30, |
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2019 |
|
2018 |
|
2019 |
|
2018 |
||||
Organic RGU net additions (losses) by product |
|
|
|
|
|
|
|
||||
Video |
17,700 |
|
|
14,700 |
|
|
32,600 |
|
|
17,100 |
|
Data |
44,400 |
|
|
44,900 |
|
|
94,500 |
|
|
81,900 |
|
Voice |
4,500 |
|
|
1,500 |
|
|
12,500 |
|
|
(4,600 |
) |
Total |
66,600 |
|
|
61,100 |
|
|
139,600 |
|
|
94,400 |
|
|
|
|
|
|
|
|
|
||||
Organic RGU net additions (losses) by segment |
|
|
|
|
|
|
|
||||
C&W |
30,400 |
|
|
28,600 |
|
|
62,000 |
|
|
53,700 |
|
VTR/Cabletica |
31,100 |
|
|
21,600 |
|
|
50,800 |
|
|
45,200 |
|
Liberty Puerto Rico |
5,100 |
|
|
10,900 |
|
|
26,800 |
|
|
(4,500 |
) |
Total |
66,600 |
|
|
61,100 |
|
|
139,600 |
|
|
94,400 |
|
|
|
|
|
|
|
|
|
||||
Organic Mobile SIM additions (losses) by product |
|
|
|
|
|
|
|
||||
Postpaid |
8,200 |
|
|
10,000 |
|
|
18,600 |
|
|
13,400 |
|
Prepaid |
35,900 |
|
|
(85,900 |
) |
|
36,300 |
|
|
(100,300 |
) |
Total |
44,100 |
|
|
(75,900 |
) |
|
54,900 |
|
|
(86,900 |
) |
|
|
|
|
|
|
|
|
||||
Organic Mobile SIM additions (losses) by segment |
|
|
|
|
|
|
|
||||
C&W |
34,300 |
|
|
(88,500 |
) |
|
35,100 |
|
|
(108,300 |
) |
VTR/Cabletica |
9,800 |
|
|
12,600 |
|
|
19,800 |
|
|
21,400 |
|
Total |
44,100 |
|
|
(75,900 |
) |
|
54,900 |
|
|
(86,900 |
) |
Revenue Highlights
The following table presents (i) revenue of each of our reportable segments for the comparative periods and (ii) the percentage change from period to period on both a reported and rebased basis:
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Three months ended |
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Increase/(decrease) |
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Six months ended |
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Increase/(decrease) |
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June 30, |
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June 30, |
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2019 |
|
2018 |
|
% |
|
Rebased % |
|
2019 |
|
2018 |
|
% |
|
Rebased % |
||||||||||||
|
in millions, except % amounts |
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|
|
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|
|
|
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C&W |
$ |
606.6 |
|
|
$ |
583.7 |
|
|
3.9 |
|
|
(0.5 |
) |
|
$ |
1,176.4 |
|
|
$ |
1,169.2 |
|
|
0.6 |
|
|
(1.1 |
) |
VTR/Cabletica |
274.5 |
|
|
260.2 |
|
|
5.5 |
|
|
3.0 |
|
|
551.0 |
|
|
524.0 |
|
|
5.2 |
|
|
3.5 |
|
||||
Liberty Puerto Rico |
103.8 |
|
|
80.3 |
|
|
29.3 |
|
|
24.9 |
|
|
202.4 |
|
|
142.1 |
|
|
42.4 |
|
|
39.5 |
|
||||
Intersegment eliminations |
(2.0 |
) |
|
(2.1 |
) |
|
N.M. |
|
N.M. |
|
(4.2 |
) |
|
(3.3 |
) |
|
N.M. |
|
N.M. |
||||||||
Total |
$ |
982.9 |
|
|
$ |
922.1 |
|
|
6.6 |
|
|
2.7 |
|
|
$ |
1,925.6 |
|
|
$ |
1,832.0 |
|
|
5.1 |
|
|
3.3 |
|
N.M. ? Not Meaningful. |
Q2 2019 Rebased Revenue Growth ? Segment Highlights
Operating Income
Operating Cash Flow Highlights
The following table presents (i) OCF of each of our reportable segments and our corporate category for the comparative periods and (ii) the percentage change from period to period on both a reported and rebased basis:
|
Three months ended |
|
Increase |
|
Six months ended |
|
Increase |
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June 30, |
|
|
June 30, |
|
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|
2019 |
|
2018 |
|
% |
|
Rebased % |
|
2019 |
|
2018 |
|
% |
|
Rebased % |
||||||||||||
|
in millions, except % amounts |
||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
C&W |
$ |
235.4 |
|
|
$ |
223.6 |
|
|
5.3 |
|
|
3.3 |
|
|
$ |
457.9 |
|
|
$ |
452.7 |
|
|
1.1 |
|
|
0.7 |
|
VTR/Cabletica |
112.3 |
|
|
105.1 |
|
|
6.9 |
|
|
6.1 |
|
|
219.2 |
|
|
210.1 |
|
|
4.3 |
|
|
4.7 |
|
||||
Liberty Puerto Rico |
51.6 |
|
|
35.7 |
|
|
44.5 |
|
|
41.8 |
|
|
99.5 |
|
|
53.7 |
|
|
85.3 |
|
|
82.0 |
|
||||
Corporate |
(11.9 |
) |
|
(11.0 |
) |
|
8.2 |
|
|
8.2 |
|
|
(23.4 |
) |
|
(22.3 |
) |
|
4.9 |
|
|
4.9 |
|
||||
Total |
$ |
387.4 |
|
|
$ |
353.4 |
|
|
9.6 |
|
|
7.8 |
|
|
$ |
753.2 |
|
|
$ |
694.2 |
|
|
8.5 |
|
|
8.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
OCF Margin |
39.4 |
% |
|
38.3 |
% |
|
|
|
|
|
39.1 |
% |
|
37.9 |
% |
|
|
|
|
Q2 2019 Rebased OCF Growth ? Segment Highlights
Net Loss Attributable to Shareholders
Property and Equipment Additions and Capital Expenditures
The table below highlights the categories of the property and equipment additions for the indicated periods and reconciles those additions to the capital expenditures that are presented in the condensed consolidated statements of cash flows included in our Form 10-Q.
|
Three months ended |
|
Six months ended |
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|
June 30, |
|
June 30, |
||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
|
in millions, except % amounts |
||||||||||||||
|
|
|
|
|
|
|
|
||||||||
Customer Premises Equipment |
$ |
76.1 |
|
|
$ |
81.1 |
|
|
$ |
148.0 |
|
|
$ |
146.6 |
|
New Build & Upgrade |
27.6 |
|
|
59.3 |
|
|
49.2 |
|
|
139.6 |
|
||||
Capacity |
23.9 |
|
|
39.2 |
|
|
34.8 |
|
|
46.4 |
|
||||
Baseline |
23.3 |
|
|
17.8 |
|
|
46.6 |
|
|
45.5 |
|
||||
Product & Enablers |
15.2 |
|
|
20.2 |
|
|
26.6 |
|
|
33.5 |
|
||||
Property and equipment additions |
166.1 |
|
|
217.6 |
|
|
305.2 |
|
|
411.6 |
|
||||
Assets acquired under capital-related vendor financing arrangements |
(15.1 |
) |
|
(14.3 |
) |
|
(26.0 |
) |
|
(35.0 |
) |
||||
Assets acquired under finance leases |
(0.1 |
) |
|
(0.3 |
) |
|
(0.2 |
) |
|
(0.9 |
) |
||||
Changes in current liabilities related to capital expenditures |
(15.1 |
) |
|
33.9 |
|
|
16.4 |
|
|
49.4 |
|
||||
Capital expenditures1 |
$ |
135.8 |
|
|
$ |
236.9 |
|
|
$ |
295.4 |
|
|
$ |
425.1 |
|
|
|
|
|
|
|
|
|
||||||||
Property and equipment additions as % of revenue |
16.9 |
% |
|
23.6 |
% |
|
15.8 |
% |
|
22.5 |
% |
||||
|
|
|
|
|
|
|
|
||||||||
Property and Equipment Additions of our Reportable Segments: |
|
|
|
|
|
|
|
||||||||
C&W |
$ |
82.1 |
|
|
$ |
102.0 |
|
|
$ |
145.7 |
|
|
$ |
169.2 |
|
VTR/Cabletica |
63.0 |
|
|
59.0 |
|
|
117.1 |
|
|
116.0 |
|
||||
Liberty Puerto Rico |
19.3 |
|
|
45.2 |
|
|
39.1 |
|
|
115.0 |
|
||||
Corporate |
1.7 |
|
|
11.4 |
|
|
3.3 |
|
|
11.4 |
|
||||
Property and equipment additions |
$ |
166.1 |
|
|
$ |
217.6 |
|
|
$ |
305.2 |
|
|
$ |
411.6 |
|
Segment Highlights
Leverage and Liquidity (at June 30, 2019)
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, priorities, financial performance and guidance, operational and financial momentum, and future growth prospects and opportunities, including B2B opportunities and inorganic growth opportunities (like our acquisitions of Cabletica and UTS) and the potential benefits from such opportunities; our expectations with respect to subscribers, customer data usage, revenue, OCF and Adjusted FCF; statements regarding the development, enhancement, and expansion of, our superior networks (including our plans to deliver new or upgraded homes in 2019 and our plans to expand LTE coverage and usage), our customer value propositions and the anticipated impacts of such activity including increased subscribers and revenue; our estimates of future P&E additions and operating expenditures, each as a percentage of revenue; the strength of our balance sheet and tenor of our debt; 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 hurricanes and other natural disasters, the ability and cost to restore networks in the markets impacted by hurricanes; the continued use by subscribers and potential subscribers of our services and their willingness to upgrade to our more advanced offerings; our ability to meet challenges from competition, to manage rapid technological change or to maintain or increase rates to our subscribers or to pass through increased costs to our subscribers; the effects of changes in laws or regulation; general economic factors; our ability to obtain regulatory approval and satisfy conditions associated with acquisitions and dispositions; our ability to successfully acquire and integrate new businesses and realize anticipated efficiencies from acquired businesses; the availability of attractive programming for our video services and the costs associated with such programming; our ability to achieve forecasted financial and operating targets; the outcome of any pending or threatened litigation; the ability of our operating companies to access cash of their respective subsidiaries; the impact of our operating companies' 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 and vendors (including our third-party wireless network provider under our MVNO arrangement) to timely deliver quality products, equipment, software, services and access; our 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, including our most recently filed Form 10-K and Form 10-Q. These forward-looking statements speak only as of the date of this press 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.
About Liberty Latin America
Liberty Latin America is a leading telecommunications company operating in over 20 countries across Latin America and the Caribbean under the consumer brands VTR, Flow, Liberty, Más Móvil, BTC, UTS and Cabletica. The communications and entertainment services that we offer to our residential and business customers in the region include digital video, broadband internet, telephony and mobile services. Our business products and services include enterprise-grade connectivity, data center, hosting and managed solutions, as well as information technology solutions with customers ranging from small and medium enterprises to international companies and governmental agencies. In addition, Liberty Latin America operates a subsea and terrestrial fiber optic cable network that connects over 40 markets in the region.
Liberty Latin America has three separate classes of common shares, which are traded on the NASDAQ Global Select Market under the symbols "LILA" (Class A) and "LILAK" (Class C), and on the OTC link under the symbol "LILAB" (Class B).
For more information, please visit www.lla.com.
Footnotes
Balance Sheets, Statements of Operations and Statements of Cash Flows
The condensed consolidated balance sheets, statements of operations and statements of cash flows of Liberty Latin America are included in our Quarterly Report on Form 10-Q.
Rebase Information
For purposes of calculating rebased growth rates on a comparable basis for all businesses that we owned during 2019, we have adjusted our historical revenue and OCF for the three and six months ended June 30, 2018 to (i) include the pre-acquisition revenue and OCF of certain entities acquired during 2019 and 2018 in our rebased amounts for the three and six months ended June 30, 2018 to the same extent that the revenue and OCF of such entities are included in our results for the three and six months ended June 30, 2019, and (ii) reflect the translation of our rebased amounts for the three and six months ended June 30, 2018 at the applicable average foreign currency exchange rates that were used to translate our results for the three and six months ended June 30, 2019. We have included Cabletica and UTS in the determination of our rebased revenue and OCF for the three and six months ended June 30, 2018. We have reflected the revenue and OCF of the acquired entities in our 2018 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 their revenue and OCF on a basis that is comparable to the corresponding post-acquisition amounts that are included in our historical results or that the pre-acquisition financial statements we have relied upon do not contain undetected errors. The adjustments reflected in our rebased amounts have not been prepared with a view towards complying with Article 11 of Regulation S-X. In addition, the rebased growth percentages are not necessarily indicative of the revenue and OCF that would have occurred if these transactions had occurred on the dates assumed for purposes of calculating our rebased amounts or the revenue and OCF that will occur in the future. The rebased growth percentages have been presented as a basis for assessing growth rates on a comparable basis, and are not presented as a measure of our pro forma financial performance. The following table provides adjustments made to the revenue and OCF amounts for the three and six months ended June 30, 2018 to derive our rebased growth rates. Due to rounding, certain rebased growth rate percentages may not recalculate. In addition, for purposes of computing rebased growth rates for our C&W and Liberty Puerto Rico segments, we have adjusted the historical revenue and OCF of these segments for the quarter ended June 30, 2018 for the impact of the April 1, 2019 transfer of a small B2B operation in Puerto Rico from our C&W segment to our Liberty Puerto Rico segment. The amounts in the table below exclude the revenue and OCF of $3 million and $1 million, respectively, for the three months ended June 30, 2018 of the transferred operation since such amounts eliminate in consolidation.
|
Revenue |
|
OCF |
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|
Three months ended
|
|
Six months ended
|
|
Three months ended
|
|
Six months ended
|
||||||||
|
in millions |
||||||||||||||
|
|
|
|
|
|
|
|
||||||||
Acquisition |
$ |
65.9 |
|
|
$ |
95.7 |
|
|
$ |
17.8 |
|
|
$ |
27.2 |
|
Foreign currency |
(31.3 |
) |
|
(65.0 |
) |
|
(11.8 |
) |
|
(24.7 |
) |
||||
Total |
$ |
34.6 |
|
|
$ |
30.7 |
|
|
$ |
6.0 |
|
|
$ |
2.5 |
|
OCF Definition and Reconciliation
As used herein, OCF has the same meaning as the term "Adjusted OIBDA" that is referenced in our Form 10-Q. OCF is the primary measure used by our chief operating decision maker to evaluate segment operating performance. OCF 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 incentive compensation plans. As we use the term, OCF is defined as operating income or loss before 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 (i) gains and losses on the disposition of long-lived assets, (ii) third-party costs directly associated with successful and unsuccessful acquisitions and dispositions, including legal, advisory and due diligence fees, as applicable, and (iii) other acquisition-related items, such as gains and losses on the settlement of contingent consideration. Our internal decision makers believe OCF 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 (i) readily view operating trends, (ii) perform analytical comparisons and benchmarking between segments and (iii) identify strategies to improve operating performance in the different countries in which we operate. We believe our OCF 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. OCF should be viewed as a measure of operating performance that is a supplement to, and not a substitute for, operating income, net earnings or loss, cash flow from operating activities and other U.S. GAAP measures of income or cash flows. A reconciliation of our operating income to total OCF is presented in the following table:
|
Three months ended |
|
Six months ended |
||||||||||||
|
June 30, |
|
June 30, |
||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
|
in millions |
||||||||||||||
|
|
|
|
|
|
|
|
||||||||
Operating income |
$ |
143.5 |
|
|
$ |
124.2 |
|
|
$ |
256.8 |
|
|
$ |
222.5 |
|
Share-based compensation expense |
15.4 |
|
|
8.7 |
|
|
30.1 |
|
|
15.2 |
|
||||
Depreciation and amortization |
222.0 |
|
|
207.6 |
|
|
439.3 |
|
|
409.9 |
|
||||
Impairment, restructuring and other operating items, net |
6.5 |
|
|
12.9 |
|
|
27.0 |
|
|
46.6 |
|
||||
Total OCF |
$ |
387.4 |
|
|
$ |
353.4 |
|
|
$ |
753.2 |
|
|
$ |
694.2 |
|
Summary of Debt, Finance Lease Obligations & Cash and Cash Equivalents
The following table details the U.S. dollar equivalent balances of the outstanding principal amounts of our debt, finance lease obligations and cash and cash equivalents at June 30, 2019:
|
Debt |
|
Finance lease
|
|
Debt and
|
|
Cash and
|
||||||||
|
in millions |
||||||||||||||
|
|
|
|
|
|
|
|
||||||||
Liberty Latin America1 |
$ |
402.5 |
|
|
$ |
1.5 |
|
|
$ |
404.0 |
|
|
$ |
407.3 |
|
C&W |
4,094.4 |
|
|
8.8 |
|
|
4,103.2 |
|
|
389.3 |
|
||||
VTR |
1,615.8 |
|
|
0.3 |
|
|
1,616.1 |
|
|
121.0 |
|
||||
Liberty Puerto Rico |
922.5 |
|
|
? |
|
|
922.5 |
|
|
22.3 |
|
||||
Cabletica |
127.7 |
|
|
? |
|
|
127.7 |
|
|
17.5 |
|
||||
Total |
$ |
7,162.9 |
|
|
$ |
10.6 |
|
|
$ |
7,173.5 |
|
|
$ |
957.4 |
|
Adjusted Free Cash Flow Definition and Reconciliation
We define Adjusted FCF as net cash provided by our operating activities, plus (i) cash payments for third-party costs directly associated with successful and unsuccessful acquisitions and dispositions,(ii) expenses financed by an intermediary and (iii) insurance recoveries related to damaged and destroyed property and equipment, less (a) capital expenditures, (b) distributions to noncontrolling interest owners, (c) principal payments on amounts financed by vendors and intermediaries and (d) principal payments on finance leases. Effective December 31, 2018, and in connection with our hurricane insurance settlements, we changed the way we define adjusted free cash flow to include proceeds from insurance recoveries related to damaged and destroyed property and equipment. We believe this change is appropriate as such cash proceeds effectively partially offset payments for capital expenditures to replace the property and equipment that was damaged or destroyed as a result of the Hurricanes. We believe that our presentation of Adjusted FCF provides useful information to our investors because this measure can be used to gauge our ability to service debt and fund new investment opportunities. Adjusted FCF should not be understood to represent our ability to fund discretionary amounts, as we have various mandatory and contractual obligations, including debt repayments, which are not deducted to arrive at this amount. Investors should view Adjusted FCF as a supplement to, and not a substitute for, U.S. GAAP measures of liquidity included in our consolidated statements of cash flows. The following table provides the reconciliation of our net cash provided by operating activities to Adjusted FCF for the indicated periods:
|
Three months ended |
|
Six months ended |
||||||||||||
|
June 30, |
|
June 30, |
||||||||||||
|
2019 |
|
2018 |
|
2019 |
|
2018 |
||||||||
|
in millions |
||||||||||||||
|
|
|
|
|
|
|
|
||||||||
Net cash provided by operating activities |
$ |
243.6 |
|
|
$ |
234.8 |
|
|
$ |
431.4 |
|
|
$ |
398.0 |
|
Cash payments for direct acquisition and disposition costs |
1.9 |
|
|
1.2 |
|
|
0.6 |
|
|
1.3 |
|
||||
Expenses financed by an intermediary1 |
25.5 |
|
|
62.6 |
|
|
56.8 |
|
|
94.9 |
|
||||
Capital expenditures |
(135.8 |
) |
|
(236.9 |
) |
|
(295.4 |
) |
|
(425.1 |
) |
||||
Recovery on damaged or destroyed property and equipment |
? |
|
|
? |
|
|
33.9 |
|
|
? |
|
||||
Distributions to noncontrolling interest owners |
(2.5 |
) |
|
(19.8 |
) |
|
(2.5 |
) |
|
(19.8 |
) |
||||
Principal payments on amounts financed by vendors and intermediaries |
(63.6 |
) |
|
(53.9 |
) |
|
(105.9 |
) |
|
(105.0 |
) |
||||
Principal payments on finance leases |
(1.1 |
) |
|
(1.8 |
) |
|
(2.5 |
) |
|
(3.8 |
) |
||||
Adjusted FCF |
$ |
68.0 |
|
|
$ |
(13.8 |
) |
|
$ |
116.4 |
|
|
$ |
(59.5 |
) |
ARPU per Customer Relationship
The following table provides ARPU per customer relationship for the indicated periods:
|
Three months ended June 30, |
|
|
|
FX-Neutral1 |
||||||||
|
2019 |
|
2018 |
|
% Change |
|
% Change |
||||||
|
|
|
|
|
|
|
|
||||||
Liberty Latin America2,3,4,5 |
$ |
47.64 |
|
|
$ |
51.05 |
|
|
(6.7 |
%) |
|
(1.5 |
%) |
C&W2,4 |
$ |
47.67 |
|
|
$ |
46.05 |
|
|
3.5 |
% |
|
4.1 |
% |
VTR/Cabletica5 |
$ |
47.62 |
|
|
$ |
54.21 |
|
|
(12.2 |
%) |
|
(4.7 |
%) |
VTR |
CLP |
33,223 |
|
|
CLP |
33,688 |
|
|
(1.4 |
%) |
|
(1.4 |
%) |
Cabletica |
CRC |
24,708 |
|
|
? |
|
|
N.M. |
|
N.M. |
|||
N.M. ? Not Meaningful. |
Mobile ARPU6
The following table provides ARPU per mobile subscriber for the indicated periods:
|
Three months ended June 30, |
|
|
|
FX-Neutral1 |
||||||||
|
2019 |
|
2018 |
|
% Change |
|
% Change |
||||||
|
|
|
|
|
|
|
|
||||||
Liberty Latin America2,4 |
$ |
14.43 |
|
|
$ |
15.55 |
|
|
(7.2 |
%) |
|
(5.6 |
%) |
C&W2,4 |
$ |
14.03 |
|
|
$ |
15.02 |
|
|
(6.6 |
%) |
|
(5.9 |
%) |
VTR |
$ |
19.50 |
|
|
$ |
23.25 |
|
|
(16.1 |
%) |
|
(7.8 |
%) |
Additional Information | Cable & Wireless Borrowing Group
Effective December 31, 2018, C&W changed its basis of accounting from International Financial Reporting Standards as issued by the International Accounting Standards Board to generally accepted accounting principles in the United States ("U.S. GAAP"). Accordingly, the following financial information for the three and six months ended June 30, 2018 set forth in the table below has been revised from the prior-year amounts to be in accordance with U.S. GAAP. The following table reflects preliminary unaudited selected financial results for three and six months ended June 30, 2019 and 2018 in accordance with U.S. GAAP.
|
Three months ended |
|
|
|
Six months ended |
|
|
||||||||||||||
|
June 30, |
|
Rebased change1 |
|
June 30, |
|
Rebased change1 |
||||||||||||||
|
2019 |
|
2018 |
|
|
2019 |
|
2018 |
|
||||||||||||
|
in millions, except % amounts |
||||||||||||||||||||
Residential revenue: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Residential fixed revenue: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Subscription revenue: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Video |
$ |
46.8 |
|
|
$ |
43.2 |
|
|
|
|
$ |
90.7 |
|
|
$ |
85.9 |
|
|
|
||
Broadband internet |
65.5 |
|
|
56.4 |
|
|
|
|
125.7 |
|
|
110.1 |
|
|
|
||||||
Fixed-line telephony |
26.7 |
|
|
25.9 |
|
|
|
|
51.0 |
|
|
52.8 |
|
|
|
||||||
Total subscription revenue |
139.0 |
|
|
125.5 |
|
|
|
|
267.4 |
|
|
248.8 |
|
|
|
||||||
Non-subscription revenue |
14.9 |
|
|
16.9 |
|
|
|
|
29.9 |
|
|
32.4 |
|
|
|
||||||
Total residential fixed revenue |
153.9 |
|
|
142.4 |
|
|
1.4 |
% |
|
297.3 |
|
|
281.2 |
|
|
3.1 |
% |
||||
Residential mobile revenue: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Service revenue |
142.1 |
|
|
151.1 |
|
|
|
|
277.1 |
|
|
306.2 |
|
|
|
||||||
Interconnect, equipment sales and other |
22.2 |
|
|
21.6 |
|
|
|
|
41.2 |
|
|
43.7 |
|
|
|
||||||
Total residential mobile revenue |
164.3 |
|
|
172.7 |
|
|
(9.3 |
%) |
|
318.3 |
|
|
349.9 |
|
|
(11.1 |
%) |
||||
Total residential revenue |
318.2 |
|
|
315.1 |
|
|
(4.4 |
%) |
|
615.6 |
|
|
631.1 |
|
|
(4.8 |
%) |
||||
B2B revenue: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Service revenue |
226.8 |
|
|
204.2 |
|
|
|
|
439.3 |
|
|
414.1 |
|
|
|
||||||
Subsea network revenue |
61.6 |
|
|
64.4 |
|
|
|
|
121.5 |
|
|
124.0 |
|
|
|
||||||
Total B2B revenue |
288.4 |
|
|
268.6 |
|
|
4.2 |
% |
|
560.8 |
|
|
538.1 |
|
|
3.2 |
% |
||||
Total |
$ |
606.6 |
|
|
$ |
583.7 |
|
|
(0.5 |
%) |
|
$ |
1,176.4 |
|
|
$ |
1,169.2 |
|
|
(1.1 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OCF |
$ |
235.4 |
|
|
$ |
223.6 |
|
|
3.3 |
% |
|
$ |
457.9 |
|
|
$ |
452.7 |
|
|
0.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income |
$ |
61.3 |
|
|
$ |
51.5 |
|
|
|
|
$ |
113.6 |
|
|
$ |
86.8 |
|
|
|
||
Share-based compensation expense |
5.2 |
|
|
2.8 |
|
|
|
|
8.9 |
|
|
4.7 |
|
|
|
||||||
Depreciation and amortization |
155.7 |
|
|
155.9 |
|
|
|
|
306.3 |
|
|
310.0 |
|
|
|
||||||
Related-party fees and allocations |
7.8 |
|
|
7.0 |
|
|
|
|
15.7 |
|
|
13.6 |
|
|
|
||||||
Impairment, restructuring and other operating items, net |
5.4 |
|
|
6.4 |
|
|
|
|
13.4 |
|
|
37.6 |
|
|
|
||||||
OCF |
235.4 |
|
|
223.6 |
|
|
|
|
457.9 |
|
|
452.7 |
|
|
|
||||||
Noncontrolling interests' share of OCF2 |
40.6 |
|
|
42.0 |
|
|
|
|
78.9 |
|
|
89.9 |
|
|
|
||||||
Proportionate OCF |
$ |
194.8 |
|
|
$ |
181.6 |
|
|
|
|
$ |
379.0 |
|
|
$ |
362.8 |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
OCF as a percentage of revenue |
38.8 |
% |
|
38.3 |
% |
|
|
|
38.9 |
% |
|
38.7 |
% |
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating income as a percentage of revenue |
10.1 |
% |
|
8.8 |
% |
|
|
|
9.7 |
% |
|
7.4 |
% |
|
|
The following table details the borrowing currency and U.S. dollar equivalent of the nominal amount outstanding of C&W's third-party debt, finance lease obligations and cash and cash equivalents:
|
|
|
June 30, |
|
March 31, |
||||||
|
Facility Amount |
|
2019 |
|
2019 |
||||||
|
in millions |
||||||||||
Credit Facilities: |
|
|
|
|
|
||||||
Term Loan Facility B-4 due 2026 (LIBOR + 3.25%) |
$ |
1,640.0 |
|
|
$ |
1,640.0 |
|
|
$ |
1,875.0 |
|
Revolving Credit Facility due 2023 (LIBOR + 3.25%) |
$ |
625.0 |
|
|
? |
|
|
170.0 |
|
||
Total Senior Secured Credit Facilities |
|
1,640.0 |
|
|
2,045.0 |
|
|||||
Notes: |
|
|
|
|
|
||||||
Senior Secured Notes: |
|
|
|
|
|
||||||
5.75% USD Senior Secured Notes due 2027 |
$ |
400.0 |
|
|
400.0 |
|
|
? |
|
||
Senior Notes: |
|
|
|
|
|
||||||
6.875% USD Senior Notes due 2022 |
$ |
210.0 |
|
|
210.0 |
|
|
475.0 |
|
||
7.5% USD Senior Notes due 2026 |
$ |
500.0 |
|
|
500.0 |
|
|
500.0 |
|
||
6.875% USD Senior Notes due 2027 |
$ |
1,000.0 |
|
|
1,000.0 |
|
|
700.0 |
|
||
Total Notes |
|
2,110.0 |
|
|
1,675.0 |
|
|||||
Other Regional Debt |
|
303.6 |
|
|
312.3 |
|
|||||
Vendor financing |
|
40.8 |
|
|
58.3 |
|
|||||
Finance lease obligations |
|
8.8 |
|
|
9.8 |
|
|||||
Total debt and finance lease obligations |
|
4,103.2 |
|
|
4,100.4 |
|
|||||
Discounts and deferred financing costs, net |
|
(26.2 |
) |
|
(6.8 |
) |
|||||
Total carrying amount of debt and finance lease obligations |
|
4,077.0 |
|
|
4,093.6 |
|
|||||
Less: cash and cash equivalents |
|
389.3 |
|
|
324.6 |
|
|||||
Net carrying amount of debt and finance lease obligations |
|
$ |
3,687.7 |
|
|
$ |
3,769.0 |
|
VTR Borrowing Group
The following table reflects preliminary unaudited selected financial results for three and six months ended June 30, 2019 and 2018 in accordance with U.S. GAAP.
|
Three months ended |
|
|
|
Six months ended |
|
|
||||||||||
|
June 30, |
|
|
|
June 30, |
|
|
||||||||||
|
2019 |
|
2018 |
|
Change |
|
2019 |
|
2018 |
|
Change |
||||||
|
CLP in billions, except % amounts |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenue |
165.3 |
|
|
161.6 |
|
|
2.3 |
% |
|
328.1 |
|
|
320.5 |
|
|
2.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
OCF |
68.5 |
|
|
65.3 |
|
|
4.9 |
% |
|
131.7 |
|
|
128.5 |
|
|
2.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating income |
39.3 |
|
|
43.5 |
|
|
|
|
66.4 |
|
|
85.1 |
|
|
|
||
Share-based compensation expense |
1.0 |
|
|
0.4 |
|
|
|
|
1.9 |
|
|
0.8 |
|
|
|
||
Related-party fees and allocations |
1.4 |
|
|
1.9 |
|
|
|
|
3.6 |
|
|
3.7 |
|
|
|
||
Depreciation |
26.6 |
|
|
17.8 |
|
|
|
|
52.6 |
|
|
35.7 |
|
|
|
||
Impairment, restructuring and other operating items, net |
0.2 |
|
|
1.7 |
|
|
|
|
7.2 |
|
|
3.2 |
|
|
|
||
OCF |
68.5 |
|
|
65.3 |
|
|
|
|
131.7 |
|
|
128.5 |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
OCF as a percentage of revenue |
41.4 |
% |
|
40.4 |
% |
|
|
|
40.1 |
% |
|
40.1 |
% |
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating income as a percentage of revenue |
23.8 |
% |
|
26.9 |
% |
|
|
|
20.2 |
% |
|
26.6 |
% |
|
|
The following table details the borrowing currency and Chilean peso equivalent of the nominal amount outstanding of VTR's third-party debt, finance lease obligations and cash and cash equivalents:
|
June 30, |
|
March 31, |
||||||
|
2019 |
|
2019 |
||||||
|
Borrowing
|
|
CLP equivalent in billions |
||||||
|
|
|
|
|
|
||||
|
|
|
|
|
|
||||
Credit Facilities: |
|
|
|
|
|
||||
Term Loan Facility B-1 due 20231 (ICP2+ 3.80%) |
CLP 140,900 |
|
140.9 |
|
|
140.9 |
|
||
Term Loan Facility B-2 due 2023 (7.000%) |
CLP 33,100 |
|
33.1 |
|
|
33.1 |
|
||
Revolving Credit Facility A due 2023 (TAB3+3.35%) |
CLP 45,000 |
|
? |
|
|
? |
|
||
Revolving Credit Facility B due 20244 (LIBOR + 2.75%) |
$ |
185.0 |
|
|
? |
|
|
? |
|
Total Senior Secured Credit Facilities |
|
174.0 |
|
|
174.0 |
|
|||
Senior Notes: |
|
|
|
|
|
||||
6.875% USD Senior Notes due 2024 |
$ |
1,260.0 |
|
|
855.2 |
|
|
856.4 |
|
|
|
|
|
|
|||||
Vendor Financing |
|
67.5 |
|
|
69.6 |
|
|||
Finance lease obligations |
|
0.2 |
|
|
0.3 |
|
|||
Total third-party debt and finance lease obligations |
|
1,096.9 |
|
|
1,100.3 |
|
|||
Deferred financing costs |
|
(14.3 |
) |
|
(15.0 |
) |
|||
Total carrying amount of third-party debt and finance lease obligations |
|
1,082.6 |
|
|
1,085.3 |
|
|||
Less: cash and cash equivalents |
|
82.1 |
|
|
74.6 |
|
|||
Net carrying amount of third-party debt and finance lease obligations |
|
1,000.5 |
|
|
1,010.7 |
|
|||
|
|
|
|
|
|
||||
Exchange rate (CLP to $) |
|
678.7 |
|
|
679.7 |
|
Liberty Puerto Rico Borrowing Group:
The following table details the nominal amount outstanding of Liberty Puerto Rico's third-party debt and cash and cash equivalents:
|
Facility amount |
|
June 30, 2019 |
|
March 31, 2019 |
||||||
|
in millions |
||||||||||
|
|
|
|
|
|
||||||
First Lien Term Loan due 20221 (LIBOR + 3.50%) |
$ |
850.0 |
|
|
$ |
850.0 |
|
|
$ |
850.0 |
|
Second Lien Term Loan due 20231 (LIBOR + 6.75%) |
$ |
72.5 |
|
|
72.5 |
|
|
92.5 |
|
||
Revolving Credit Facility due 2020 (LIBOR + 3.50%) |
$ |
40.0 |
|
|
? |
|
|
? |
|
||
Third-party debt before discounts and deferred financing costs |
|
922.5 |
|
|
942.5 |
|
|||||
Discounts and deferred financing costs |
|
(7.5 |
) |
|
(8.2 |
) |
|||||
Total carrying amount of third-party debt |
|
915.0 |
|
|
934.3 |
|
|||||
Less: cash and cash equivalents |
|
22.3 |
|
|
55.2 |
|
|||||
Net carrying amount of third-party debt |
|
$ |
892.7 |
|
|
$ |
879.1 |
|
Cabletica Borrowing Group:
The following table details the borrowing currency and Costa Rican colón equivalent of the nominal amount outstanding of Cabletica's third-party debt and cash and cash equivalents:
|
June 30, |
|
March 31, |
||||||
|
2019 |
|
2019 |
||||||
|
Borrowing
|
|
CRC equivalent in billions |
||||||
|
|
|
|
|
|
||||
Term Loan B-1 Facility due 20231 (LIBOR + 5.00%) |
$ |
53.5 |
|
|
31.1 |
|
|
32.0 |
|
Term Loan B-2 Facility due 20231 (TBP2 + 6.00%) |
CRC 43,177.4 |
|
43.2 |
|
|
43.2 |
|
||
Revolving Credit Facility due 2023 (LIBOR + 4.25%) |
$ |
15.0 |
|
|
? |
|
|
? |
|
Third-party debt before discounts and deferred financing costs |
|
74.3 |
|
|
75.2 |
|
|||
Deferred financing costs |
|
(2.1 |
) |
|
(2.3 |
) |
|||
Total carrying amount of third-party debt |
|
72.2 |
|
|
72.9 |
|
|||
Less: cash and cash equivalents |
|
10.2 |
|
|
10.4 |
|
|||
Net carrying amount of third-party debt |
|
62.0 |
|
|
62.5 |
|
|||
|
|
|
|
|
|
||||
Exchange rate (CRC to $) |
|
582.2 |
|
|
599.2 |
|
Subscriber Tables
|
Consolidated Operating Data ? June 30, 2019 |
|||||||||||||||||||||||
|
Homes Passed |
|
Two-way Homes Passed |
|
Fixed-line Customer Relationships |
|
Total Video |
|
Internet Subscribers |
|
Telephony Subscribers |
|
Total RGUs |
|
|
Total Mobile
|
||||||||
|
|
|
||||||||||||||||||||||
C&W: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Panama |
574,000 |
|
|
574,000 |
|
|
182,800 |
|
|
94,600 |
|
|
123,200 |
|
|
133,500 |
|
|
351,300 |
|
|
|
1,564,200 |
|
Jamaica |
523,800 |
|
|
513,800 |
|
|
251,700 |
|
|
118,700 |
|
|
201,800 |
|
|
201,500 |
|
|
522,000 |
|
|
|
997,700 |
|
The Bahamas |
128,900 |
|
|
128,900 |
|
|
47,100 |
|
|
6,100 |
|
|
25,700 |
|
|
44,400 |
|
|
76,200 |
|
|
|
213,500 |
|
Trinidad and Tobago |
327,800 |
|
|
327,800 |
|
|
156,200 |
|
|
108,600 |
|
|
133,000 |
|
|
73,600 |
|
|
315,200 |
|
|
|
? |
|
Barbados |
125,200 |
|
|
125,200 |
|
|
82,400 |
|
|
24,100 |
|
|
64,800 |
|
|
72,500 |
|
|
161,400 |
|
|
|
119,700 |
|
Other1 |
354,900 |
|
|
335,100 |
|
|
254,200 |
|
|
90,500 |
|
|
169,900 |
|
|
131,000 |
|
|
391,400 |
|
|
|
498,400 |
|
C&W Total |
2,034,600 |
|
|
2,004,800 |
|
|
974,400 |
|
|
442,600 |
|
|
718,400 |
|
|
656,500 |
|
|
1,817,500 |
|
|
|
3,393,500 |
|
VTR/Cabletica: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
VTR |
3,610,000 |
|
|
3,158,200 |
|
|
1,492,900 |
|
|
1,092,300 |
|
|
1,290,500 |
|
|
557,700 |
|
|
2,940,500 |
|
|
|
276,100 |
|
Cabletica |
592,400 |
|
|
586,500 |
|
|
245,200 |
|
|
201,600 |
|
|
180,600 |
|
|
20,900 |
|
|
403,100 |
|
|
|
? |
|
Total VTR/Cabletica |
4,202,400 |
|
|
3,744,700 |
|
|
1,738,100 |
|
|
1,293,900 |
|
|
1,471,100 |
|
|
578,600 |
|
|
3,343,600 |
|
|
|
276,100 |
|
Liberty Puerto Rico |
1,098,900 |
|
|
1,098,900 |
|
|
392,000 |
|
|
220,000 |
|
|
340,400 |
|
|
205,000 |
|
|
765,400 |
|
|
|
? |
|
Total |
7,335,900 |
|
|
6,848,400 |
|
|
3,104,500 |
|
|
1,956,500 |
|
|
2,529,900 |
|
|
1,440,100 |
|
|
5,926,500 |
|
|
|
3,669,600 |
|
|
Organic Subscriber Variance Table ? June 30, 2019 vs March 31, 2019 |
|||||||||||||||||||||||
Organic Change Summary: |
Homes
|
|
Two-way
|
|
Fixed-line Customer
|
|
Total
|
|
Internet
|
|
Telephony
|
|
Total
|
|
|
Total Mobile
|
||||||||
|
|
|
||||||||||||||||||||||
C&W: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Panama |
23,900 |
|
|
23,900 |
|
|
2,900 |
|
|
3,600 |
|
|
5,300 |
|
|
4,900 |
|
|
13,800 |
|
|
|
(26,300 |
) |
Jamaica |
2,800 |
|
|
2,800 |
|
|
2,200 |
|
|
1,400 |
|
|
4,500 |
|
|
1,200 |
|
|
7,100 |
|
|
|
75,700 |
|
The Bahamas |
? |
|
|
? |
|
|
(1,100 |
) |
|
(500 |
) |
|
(500 |
) |
|
(1,900 |
) |
|
(2,900 |
) |
|
|
(9,300 |
) |
Trinidad and Tobago |
1,200 |
|
|
1,200 |
|
|
? |
|
|
900 |
|
|
1,800 |
|
|
5,600 |
|
|
8,300 |
|
|
|
? |
|
Barbados |
? |
|
|
? |
|
|
(900 |
) |
|
3,000 |
|
|
(100 |
) |
|
(600 |
) |
|
2,300 |
|
|
|
(2,400 |
) |
Other1 |
? |
|
|
? |
|
|
2,000 |
|
|
(800 |
) |
|
3,800 |
|
|
(1,200 |
) |
|
1,800 |
|
|
|
(3,400 |
) |
C&W Total |
27,900 |
|
|
27,900 |
|
|
5,100 |
|
|
7,600 |
|
|
14,800 |
|
|
8,000 |
|
|
30,400 |
|
|
|
34,300 |
|
VTR/Cabletica: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
VTR |
51,500 |
|
|
52,100 |
|
|
16,100 |
|
|
8,600 |
|
|
18,400 |
|
|
(4,700 |
) |
|
22,300 |
|
|
|
9,800 |
|
Cabletica |
6,200 |
|
|
6,200 |
|
|
4,700 |
|
|
2,600 |
|
|
6,300 |
|
|
(100 |
) |
|
8,800 |
|
|
|
? |
|
Total VTR/Cabletica |
57,700 |
|
|
58,300 |
|
|
20,800 |
|
|
11,200 |
|
|
24,700 |
|
|
(4,800 |
) |
|
31,100 |
|
|
|
9,800 |
|
Liberty Puerto Rico |
5,100 |
|
|
5,100 |
|
|
4,200 |
|
|
(1,100 |
) |
|
4,900 |
|
|
1,300 |
|
|
5,100 |
|
|
|
? |
|
Total Organic Change |
90,700 |
|
|
91,300 |
|
|
30,100 |
|
|
17,700 |
|
|
44,400 |
|
|
4,500 |
|
|
66,600 |
|
|
|
44,100 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Q2 2019 Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
C&W - Other - UTS Acquisition |
9,500 |
|
|
9,500 |
|
|
47,100 |
|
|
14,600 |
|
|
33,000 |
|
|
37,100 |
|
|
84,700 |
|
|
|
112,000 |
|
C&W - Jamaica |
8,800 |
|
|
8,800 |
|
|
? |
|
|
? |
|
|
? |
|
|
? |
|
|
? |
|
|
|
? |
|
Net Adjustments |
18,300 |
|
|
18,300 |
|
|
47,100 |
|
|
14,600 |
|
|
33,000 |
|
|
37,100 |
|
|
84,700 |
|
|
|
112,000 |
|
Net Adds |
109,000 |
|
|
109,600 |
|
|
77,200 |
|
|
32,300 |
|
|
77,400 |
|
|
41,600 |
|
|
151,300 |
|
|
|
156,100 |
|
|
Mobile Subscribers |
||||||||||||||||
|
Consolidated Operating Data |
|
Q2 Organic Subscriber Variance |
||||||||||||||
|
Prepaid |
|
Postpaid |
|
Total |
|
Prepaid |
|
Postpaid |
|
Total |
||||||
C&W: |
|
|
|
|
|
|
|
|
|
|
|
||||||
Panama |
1,422,700 |
|
|
141,500 |
|
|
1,564,200 |
|
|
(23,500 |
) |
|
(2,800 |
) |
|
(26,300 |
) |
Jamaica |
978,000 |
|
|
19,700 |
|
|
997,700 |
|
|
74,200 |
|
|
1,500 |
|
|
75,700 |
|
The Bahamas |
188,000 |
|
|
25,500 |
|
|
213,500 |
|
|
(10,000 |
) |
|
700 |
|
|
(9,300 |
) |
Barbados |
92,200 |
|
|
27,500 |
|
|
119,700 |
|
|
(2,400 |
) |
|
? |
|
|
(2,400 |
) |
Other1 |
439,200 |
|
|
59,200 |
|
|
498,400 |
|
|
(2,600 |
) |
|
(800 |
) |
|
(3,400 |
) |
C&W Total |
3,120,100 |
|
|
273,400 |
|
|
3,393,500 |
|
|
35,700 |
|
|
(1,400 |
) |
|
34,300 |
|
VTR |
7,700 |
|
|
268,400 |
|
|
276,100 |
|
|
200 |
|
|
9,600 |
|
|
9,800 |
|
Total / Net Adds |
3,127,800 |
|
|
541,800 |
|
|
3,669,600 |
|
|
35,900 |
|
|
8,200 |
|
|
44,100 |
|
Glossary
ARPU ? Average revenue per unit refers to the average monthly subscription revenue (subscription revenue excludes interconnect, mobile handset sales and late fees) per average customer relationship or mobile subscriber, as applicable. ARPU per average customer relationship is calculated by dividing the average monthly subscription revenue from residential fixed and SOHO fixed services by the average of the opening and closing balances for customer relationships for the indicated period. ARPU per average mobile subscriber is calculated by dividing mobile service revenue for the indicated period by the average of the opening and closing balances for mobile subscribers for the indicated period. Unless otherwise indicated, ARPU per 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 of the opening and closing balances of the applicable RGUs for the period. Unless otherwise noted, ARPU in this release is considered to be ARPU per average customer relationship or mobile subscriber, as applicable. Customer relationships, mobile subscribers and RGUs of entities acquired during the period are normalized.
Consolidated Net Leverage Ratio (VTR) ? Defined in accordance with VTR's indenture for its senior notes, taking into account the ratio of its outstanding indebtedness (including the impact of its swaps) less its cash and cash equivalents to its annualized EBITDA from the most recent two consecutive fiscal quarters.
Fixed-line Customer Relationships ? The number of customers who receive at least one of our video, internet or telephony services that we count as RGUs, without regard to which or to how many services they subscribe. To the extent that RGU counts include equivalent billing unit ("EBU") adjustments, we reflect corresponding adjustments to our customer relationship counts. For further information regarding our EBU calculation, see Additional General Notes below. 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 customer relationships. We exclude mobile-only customers from customer relationships.
Fully-swapped Borrowing Cost ? Represents the weighted average interest rate on our debt (excluding finance leases and including vendor financing obligations), including the effects of derivative instruments, original issue premiums or discounts, which includes a discount on the convertible notes issued by Liberty Latin America associated with a conversion option feature, and commitment fees, but excluding the impact of financing costs. When excluding the discount on the convertible notes associated with the conversion option, the weighted average interest rate was 6.1%.
Homes Passed ? Homes, residential multiple dwelling units or commercial units that can be connected to our networks without materially extending the distribution plant, except for DTH homes. 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. We do not count homes passed for DTH.
Internet (Broadband) Subscriber ? A home, residential multiple dwelling unit or commercial unit that receives internet services over our networks.
Leverage ? Our gross and net leverage ratios are defined as total debt (total principal amount of debt and finance lease obligations outstanding, net of projected derivative principal-related cash payments (receipts)) and net debt to annualized OCF of the latest two quarters. Net debt is defined as total debt (including the convertible notes) less cash and cash equivalents. For purposes of these calculations, debt is measured using swapped foreign currency rates, consistent with the covenant calculation requirements of our subsidiary debt agreements.
Mobile Subscribers ? Our mobile subscriber count represents the number of active subscriber identification module ("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 (via a dongle) 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 60 days, based on industry standards within the respective country. In a number of countries, our mobile subscribers receive mobile services pursuant to prepaid contracts.
NPS ? Net promoter score.
OCF Margin ? Calculated by dividing OCF by total revenue for the applicable period.
Property and Equipment Addition Categories
Proportionate Net Leverage Ratio (C&W) ? Calculated in accordance with C&W's Credit Agreement, taking into account the ratio of outstanding indebtedness (subject to certain exclusions) less cash and cash equivalents to EBITDA (subject to certain adjustments) for the last two quarters annualized, with both indebtedness and EBITDA reduced proportionately to remove any noncontrolling interests' share of the C&W group.
Revenue Generating Unit ("RGU") ? RGU is separately a video subscriber, internet 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 in Chile subscribed to our video service, fixed-line telephony service and broadband internet service, the customer would constitute three RGUs. RGUs are generally counted on a unique premises basis such that a given premises 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 cable, internet 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.
SOHO ? Small office/home office customers.
Telephony Subscriber ? A home, residential multiple dwelling unit or commercial unit that receives voice services over our networks. Telephony subscribers exclude mobile telephony subscribers.
Two-way Homes Passed ? Homes passed by those sections of our networks that are technologically capable of providing two-way services, including video, internet and telephony services.
U.S. GAAP ? Generally accepted accounting principles in the United States.
Video Subscriber ? A home, residential multiple dwelling unit or commercial unit that receives our video service over our broadband network primarily via a digital video signal while subscribing to any recurring monthly service that requires the use of encryption-enabling technology. Video subscribers that are not counted on an EBU basis are generally counted on a unique premises basis. For example, a subscriber with one or more set-top boxes that receives our video service in one premises is generally counted as just one subscriber.
Additional General Notes
Most of our operations provide telephony, broadband internet, data, video or other B2B services. Certain of our B2B service revenue is derived from SOHO customers that pay a premium price to receive enhanced service levels along with video, internet 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 SOHO customers, whether or not accompanied by enhanced service levels and/or premium prices, are included in the respective RGU and customer counts of our 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 customers, we generally do not count customers of B2B services as customers or RGUs for external reporting purposes.
Certain of our residential and commercial RGUs are counted on an EBU basis, including residential multiple dwelling units and commercial establishments, such as bars, hotels, and hospitals, in Chile and Puerto Rico. Our EBUs are generally calculated by dividing the bulk price charged to accounts in an area by the most prevalent price charged to non-bulk residential customers in that market for the comparable tier of service. As such, we may experience variances in our EBU counts solely as a result of changes in rates.
While we take appropriate steps to ensure that subscriber and homes passed 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 and homes passed 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 and homes passed statistics based on those reviews.
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