England and Wales | 001-35961 | 98-1112770 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification #) |
LIBERTY GLOBAL PLC | ||
By: | /s/ RANDY L. LAZZELL | |
Randy L. Lazzell | ||
Vice President |
Exhibit No. | Name |
99.1 | Press Release |
• | Total RGUs(4) increased by 127,000 in Q1 2014, consistent with the last three quarters |
• | Horizon bundles offer superior value proposition in Unitymedia footprint |
◦ | Horizon subscriber base stood at over 100,000 at Q1, representing an increase of over 40,000 during the quarter |
◦ | Over 80% of Horizon TV customers have DVR functionality and over 50% subscribe to our 150 Mbps premium tier |
◦ | High Definition (“HD”) remained a key driver for premium video demand with 68,000 new subscribers to our HD option during Q1 |
• | Speed leadership throughout footprint bolsters competitive positioning and continues driving internet and telephony gains |
◦ | Increased internet and telephony RGUs by 82,000 and 62,000, respectively, during the quarter |
◦ | Over 45% of our internet base of 2.7 million subscribed to at least 50 Mbps |
• | Launched first national TV advertising campaign in April with messaging focused on network superiority |
• | Revenue increased 8% to €509 million in Q1 |
• | Monthly ARPU(12) per customer grew 6% to €21.07 in Q1 |
• | Adjusted EBITDA(15) increased 14% in Q1 to €313 million |
◦ | Adjusted EBITDA margin(17) expanded by 290 basis points to 61% |
• | Net loss decreased substantially to €21 million in Q1 |
• | Property, equipment and intangible asset additions(16) were 24% of revenue in Q1 |
* | For definitions and reconciliations of certain financial and subscriber metrics, please see pages 7-9. |
As of and for the three months ended March 31, | |||||||
2014 | 2013 | ||||||
Footprint | |||||||
Homes Passed(2) | 12,639,900 | 12,582,500 | |||||
Two-way Homes Passed(3) | 12,311,200 | 12,174,800 | |||||
Subscribers (RGUs)(4)(14) | |||||||
Analog Cable(5) | 4,337,700 | 4,489,400 | |||||
Digital Cable(6) | 2,247,100 | 2,177,800 | |||||
Total Video | 6,584,800 | 6,667,200 | |||||
Internet(7) | 2,661,200 | 2,319,100 | |||||
Telephony(8) | 2,579,300 | 2,323,300 | |||||
Total RGUs | 11,825,300 | 11,309,600 | |||||
Q1 organic RGU net additions (losses) | |||||||
Analog Cable | (28,800 | ) | (14,200 | ) | |||
Digital Cable | 12,200 | (8,100 | ) | ||||
Total Video | (16,600 | ) | (22,300 | ) | |||
Internet | 81,600 | 99,900 | |||||
Telephony | 61,800 | 91,300 | |||||
Total RGUs | 126,800 | 168,900 | |||||
Penetration | |||||||
Digital Cable as % of Total Video Subs(9) | 34.1 | % | 32.7 | % | |||
Internet as % of Two-way Homes Passed(10) | 21.6 | % | 19.0 | % | |||
Telephony as % of Two-way Homes Passed(10) | 21.0 | % | 19.1 | % | |||
Customer relationships(14) | |||||||
Customer Relationships(11) | 7,080,800 | 7,059,300 | |||||
RGUs per Customer Relationship | 1.67 | 1.60 | |||||
Customer bundling | |||||||
Single-Play | 62.4 | % | 66.5 | % | |||
Double-Play | 8.1 | % | 6.7 | % | |||
Triple-Play | 29.5 | % | 26.8 | % | |||
ARPU(12) | |||||||
Q1 Monthly ARPU per Customer Relationship | € | 21.07 | € | 19.85 | |||
Mobile statistics | |||||||
Mobile subscribers(13) | 255,300 | 152,800 |
Three months ended March 31, | |||||||||||
2014 | 2013 | Change | |||||||||
in millions | |||||||||||
Revenue | € | 508.7 | € | 468.9 | 8 | % | |||||
Adjusted EBITDA(15) | € | 312.6 | € | 274.9 | 14 | % | |||||
Property, equipment and intangible asset additions (16) | € | 124.5 | € | 96.4 | 29 | % | |||||
As % of Revenue | |||||||||||
Adjusted EBITDA | 61.5 | % | 58.6 | % | 290bp | ||||||
Property, equipment and intangible asset additions | 24.5 | % | 20.6 | % | (390bp) |
* | International Financial Reporting Standards, as adopted by the European Union (“EU-IFRS”). |
Description | Maturity date | Interest rate | Nominal value | Carrying value | ||||||||||||
in millions | ||||||||||||||||
New Unitymedia KabelBW Revolving Credit Facility | June 30, 2017 | Euribor + 3.25% | € | 337.5 | € | — | ||||||||||
Unitymedia KabelBW Revolving Credit Facility | June 30, 2017 | Euribor + 2.50% | € | 80.0 | € | — | ||||||||||
UM Euro Senior Secured Exchange Notes | March 15, 2019 | 7.500% | € | 735.1 | € | 740.1 | ||||||||||
UM Dollar Senior Secured Exchange Notes | March 15, 2019 | 7.500% | € | 333.5 | (18 | ) | € | 338.5 | (18 | ) | ||||||
September 2012 UM Senior Secured Notes | Sept. 15, 2022 | 5.500% | € | 650.0 | € | 650.0 | ||||||||||
December 2012 UM Dollar Senior Secured Notes | Jan. 15, 2023 | 5.500% | € | 726.1 | (18 | ) | € | 726.1 | (18 | ) | ||||||
December 2012 UM Euro Senior Secured Notes | Jan. 15, 2023 | 5.750% | € | 500.0 | € | 500.0 | ||||||||||
January 2013 UM Senior Secured Notes | Jan. 21, 2023 | 5.125% | € | 500.0 | € | 500.0 | ||||||||||
April 2013 UM Senior Secured Notes | Apr. 15, 2023 | 5.625% | € | 350.0 | € | 350.0 | ||||||||||
November 2013 UM Senior Secured Notes | Jan. 15, 2029 | 6.250% | € | 475.0 | € | 475.0 | ||||||||||
2009 UM Senior Notes | Dec. 1, 2019 | 9.625% | € | 665.0 | € | 654.3 | ||||||||||
UM Senior Exchange Notes | March 15, 2021 | 9.500% | € | 618.0 | € | 616.5 |
Investor Relations – Unitymedia KabelBW | Corporate Communications – Unitymedia KabelBW | |||
Christian Fangmann | +49 221.8462.5151 | Katrin Köster | +49 221.8462.5159 | |
Investor Relations – Liberty Global | ||||
Christopher Noyes | +1 303.220.6693 | |||
Oskar Nooij | +1 303.220.4218 |
Three months ended March 31, | ||||||||
2014 | 2013 | |||||||
in millions | ||||||||
Adjusted EBITDA | € | 312.6 | € | 274.9 | ||||
Depreciation and amortization | (176.8 | ) | (161.8 | ) | ||||
Impairment, restructuring and other operating items, net | (1.6 | ) | (1.5 | ) | ||||
Share-based compensation | (0.6 | ) | (0.3 | ) | ||||
Related-party fees and allocations(20) | (26.5 | ) | (19.1 | ) | ||||
Earnings before interest and taxes (“EBIT”) | 107.1 | 92.2 | ||||||
Net financial and other expense | (133.3 | ) | (175.4 | ) | ||||
Income tax benefit | 5.5 | 11.1 | ||||||
Net loss | € | (20.7 | ) | € | (72.1 | ) |
Three months ended March 31, | |||||||
2014 | 2013 | ||||||
in millions | |||||||
Customer premises equipment | € | 25.0 | € | 15.9 | |||
Scalable infrastructure | 14.1 | 8.7 | |||||
Line extensions / new build | 12.0 | 10.8 | |||||
Upgrade / rebuild / network improvement | 36.8 | 33.4 | |||||
Support capital | 7.6 | 2.9 | |||||
Capitalized subscriber acquisition costs | 16.7 | 19.6 | |||||
Software and licenses | 12.3 | 5.1 | |||||
Property, equipment and intangible asset additions | 124.5 | 96.4 | |||||
Assets acquired under capital-related vendor financing and capital lease arrangements | (19.6 | ) | (2.4 | ) | |||
Changes in liabilities related to capital expenditures (including related-party) | 2.1 | 5.1 | |||||
Total capital expenditures | € | 107.0 | € | 99.1 |
(1) | Unitymedia KabelBW is a wholly-owned subsidiary of Liberty Global plc (“Liberty Global”) (NASDAQ: LBTYA, LBTYB and LBTYK). A copy of this investor release is available on the websites of Unitymedia KabelBW (www.umkbw.de) and Liberty Global (www.libertyglobal.com). In addition, Unitymedia KabelBW’s Q1 2014 unaudited condensed consolidated financial statements are expected to be posted to both websites prior to the end of May 2014. |
(2) | Homes Passed are homes, residential multiple dwelling units or commercial units that can be connected to our network without materially extending the distribution plant. Our Homes Passed counts are based on census data that can change based on either revisions to the data or from new census results. |
(3) | Two-way Homes Passed are Homes Passed by those sections of our network that are technologically capable of providing two-way services, including video, internet and telephony services, up to the street cabinet, with drops from the street cabinet to the building generally added, and in-home wiring generally upgraded, on an as-needed, success-based basis. |
(4) | Revenue Generating Unit or RGU is separately an Analog Cable Subscriber, Digital Cable Subscriber, Internet Subscriber or Telephony Subscriber (as defined and described below). A home, residential multiple dwelling unit or commercial unit may contain one or more RGUs. For example, if a residential customer subscribed to our digital cable service, telephony service and broadband internet service, the customer would constitute three RGUs. Total RGUs is the sum of Analog Cable, Digital Cable, Internet and Telephony Subscribers. RGUs generally are 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. We do not include subscriptions to mobile services in our externally reported RGU counts. |
(5) | Analog Cable Subscriber is a home, residential multiple dwelling unit or commercial unit that receives our analog cable service over our broadband network. The Analog Cable Subscriber count also includes subscribers who may use a purchased set-top box or other means to receive our basic digital cable channels without subscribing to any services that would require the payment of recurring monthly fees in addition to the basic analog service fee (“Basic Digital Cable Subscriber”). Our Basic Digital Cable Subscribers are attributable to the fact that our basic digital cable channels are unencrypted. |
(6) | Digital Cable Subscriber is a home, residential multiple dwelling unit or commercial unit that receives our digital cable service over our broadband network. We count a subscriber with one or more digital converter boxes that receives our digital cable service in one premises as just one subscriber. A Digital Cable Subscriber is not counted as an Analog Cable Subscriber. As we migrate customers from analog to digital cable services, we report a decrease in our Analog Cable Subscribers equal to the increase in our Digital Cable Subscribers. As discussed in further detail in note 5 above, Basic Digital Cable Subscribers are not included in our Digital Cable Subscriber count. |
(7) | Internet Subscriber is a home, residential multiple dwelling unit or commercial unit that receives internet services over our network. Our Internet Subscribers do not include customers that receive services from dial-up connections. In our Unitymedia footprint, we offer a low-speed wholesale internet service to housing associations on a bulk basis. As of March 31, 2014, our Internet Subscribers include approximately 7,500 subscribers within such housing associations who have requested and received a modem that enables the receipt of this low-speed wholesale internet service. |
(8) | Telephony Subscriber is a home, residential multiple dwelling unit or commercial unit that receives voice services over our network. Telephony Subscribers exclude mobile telephony subscribers. |
(9) | Digital cable penetration is calculated by dividing the number of digital cable RGUs by the total number of digital and analog cable RGUs. |
(10) | Internet and telephony penetration is calculated by dividing the number of internet and telephony RGUs by the number of two-way homes passed. |
(11) | Customer Relationships are 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. Customer Relationships generally are counted on a unique premises basis. Accordingly, if an individual receives our services in two premises (e.g., primary home and vacation home), that individual generally will count as two Customer Relationships. We exclude mobile customers from Customer Relationships. |
(12) | ARPU per Customer Relationship refers to the average monthly subscription revenue per average Customer Relationship. The amount is calculated by dividing the average monthly subscription revenue (excluding fees from interconnection, installation, late fees and carriage) for the indicated period, by the average of the opening and closing balances for Customer Relationships for the period. |
(13) | Our mobile subscriber count represents the number of subscriber identification module (“SIM”) cards in service. |
(14) | Our business-to-business (“B2B”) revenue is primarily derived from small office/home office (“SOHO”) subscribers that pay a premium price to receive enhanced service levels along with internet and 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 our RGU and customer counts, with only those services provided at premium prices considered to be “SOHO RGUs” or “SOHO customers”. With the exception of our B2B SOHO subscribers, we generally do not count customers of B2B services as customers or RGUs for external reporting purposes. |
(15) | Adjusted EBITDA is the primary measure used by our management to evaluate the company’s performance. Adjusted EBITDA is also a key factor that is used by our internal decision makers to evaluate the effectiveness of our management for purposes of annual and other incentive compensation plans. We define EBITDA as earnings before net finance expense, income taxes, depreciation and amortization. As we use the term, Adjusted EBITDA is defined as EBITDA before share-based compensation, impairment, restructuring and other operating items and related-party fees and allocations, net. 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 Adjusted EBITDA is a meaningful measure and is superior to other available EU-IFRS measures because it represents a transparent view of our recurring operating performance that is unaffected by our capital structure and allows management to readily view operating trends and identify strategies to improve operating performance. We believe our Adjusted EBITDA 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 companies. Adjusted EBITDA should be viewed as a measure of operating performance that is a supplement to, and not a substitute for EBIT, net earnings (loss), cash flow from operating activities and other EU-IFRS measures of income or cash flows. A reconciliation of Adjusted EBITDA to net loss is presented on page 7. |
(16) | Property, equipment and intangible asset additions include our capital expenditures on an accrual basis and our vendor financing, capital lease and other non-cash additions. |
(17) | We define Adjusted EBITDA margin to mean Adjusted EBITDA as a percentage of revenue. |
(18) | Based on a USD/EUR exchange rate of 1.3773 as of March 31, 2014. |
(19) | Net debt represents the net carrying value of debt, including capitalized transaction costs, discounts, premiums and accrued interest, capital-related vendor financing arrangements, less cash and cash equivalents. Net debt is not a defined term under EU-IFRS and may not therefore be comparable with other similarly titled measures reported by other companies. |
(20) | Represents charges from parent for general support and administration services rendered. |
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