Operating momentum with ~190,000 fixed and mobile subscribers
added in Q2
Strong growth across key financial metrics as markets recover
from COVID-19
~360,000 homes passed / upgraded YTD, full-year target raised to
over 700,000
Expect to close acquisition of Telefónica Costa Rica's
operations by mid-August
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 2021”) ended June 30, 2021.
CEO Balan Nair commented, “Building on a strong start to the
year, we continued to drive healthy subscriber additions in Q2
across both our fixed and mobile products. Fixed RGU additions of
73,000 in the quarter took our first half performance to 149,000,
nearly twice the amount we added in H1 2020. In mobile, we reported
a best ever quarter for the group with 118,000 subscriber
additions, compared to losses in the prior year where we
experienced the initial impacts of COVID-19. These results are
particularly encouraging as our markets continue to be affected to
varying degrees by the pandemic and are yet to fully recover.”
“There is a clear opportunity to increase penetration of fixed
services across our markets, led by broadband, and during H1 we
added or upgraded approximately 360,000 homes with fiber
technologies, representing our highest ever six-month period of
activity. I'm pleased to confirm our new target for the year of
over 700,000 homes to be added or upgraded while maintaining our
guidance for P&E additions as a percentage of revenue at
approximately 18%. We remain committed to bringing high-speed
connectivity to more customers in the region.”
“The group reported $1.2 billion in revenue, $160 million of
operating income, and $464 million in Adjusted OIBDA in the second
quarter. We delivered operating income growth of 178%, reported
Adjusted OIBDA growth of 40%, and double-digit rebased Adjusted
OIBDA growth of 10%, as our largest markets returned to pre-COVID
levels, with the exception of VTR where we are stabilizing
performance following a challenging period last year. In addition
to a strong performance compared to the prior-year quarter, which
was our weakest financially since the pandemic began, revenue and
Adjusted OIBDA were also higher sequentially, evidencing continued
progress.”
“Our first half cash flow from operations and Adjusted Free Cash
Flow were $444 million and $93 million, respectively, representing
solid growth over the prior-year period as we continue to focus on
improving cash generation. During the quarter, we recommenced share
repurchases under our previously announced program.”
“Our inorganic strategy is an important driver of stakeholder
value and we are excited to have received the required
authorizations to acquire Telefónica Costa Rica's operations, with
closing to follow shortly. The transaction will create an
innovative converged provider in the country. Combined with our
fixed business, Cabletica, we plan to deliver added value to
customers through expanded product offerings, state-of-the-art
infrastructure, and outstanding customer service levels.”
“As we enter the second half of 2021, we are focused on
maintaining our positive momentum through the delivery of
compelling consumer propositions across our expanding fixed
footprint. Our organic opportunity is bolstered by last year's
acquisition of Liberty Mobile in Puerto Rico and the upcoming
addition of Telefónica Costa Rica's operations, with the respective
in-market combinations expected to generate significant synergies
and improved full-service product suites.”
Business Highlights
- C&W Caribbean & Networks: strong subscriber growth and
financial results
- Record Q2 RGU additions; 119,000 subscribers added over the
last twelve months
- Reported and rebased Adj. OIBDA growth of 13% and 14%,
respectively
- C&W Panama: continued operating & financial recovery
following severe impacts of COVID-19
- Q2 RGU additions of 9,000 and mobile subscriber additions of
60,000
- Double-digit reported and rebased revenue and Adj. OIBDA
growth
- Liberty Puerto Rico: another strong quarter across both fixed
and mobile operations
- Broadband penetration growth drove 22,000 RGU additions in
Q2
- Strong reported and rebased Adj. OIBDA growth of 208% and 21%,
respectively
- VTR: sequential stabilization; network expansion and improved
service levels
- Subscriber base stable following challenges in H2 2020
- Added >130,000 new build / upgraded homes in the quarter,
nearly double Q1 activity
- Cabletica: positioned to become a leading full-service operator
in Costa Rica
- Record Q2 RGU additions of 11,000, driven by broadband
- Combination with Telefónica's mobile business to create
compelling converged provider
LLA 2021 Financial Guidance - Update
- Reconfirming P&E additions as a percentage of revenue at
~18%; including:
- Increasing homes passed added or upgraded to over 700,000 from
~600,000
- Reconfirming our Adjusted FCF guidance of ~$200 million
Additional information, including historic quarterly revenue,
adjusted OIBDA, and P&E additions under our updated reporting
segments, can be found on our website at
https://www.lla.com/investors.
Financial and Operating Highlights
Financial Highlights
Q2 2021
Q2 2020
YoY Growth
YoY Rebase
Growth1
H1 2021
H1 2020
YoY Growth
YoY Rebase
Growth1
(USD in millions)
Revenue
$
1,168
$
849
38
%
8
%
$
2,328
$
1,780
31
%
4
%
Adjusted OIBDA2
$
464
$
333
40
%
10
%
$
913
$
697
31
%
6
%
Operating income (loss)
$
160
$
(206
)
178
%
$
338
$
(98
)
445
%
Property & equipment additions
$
215
$
153
40
%
$
367
$
286
28
%
As a percentage of revenue
18.4
%
18.1
%
15.8
%
16.1
%
Adjusted FCF3
$
35
$
130
$
93
$
81
Cash provided by operating activities
$
240
$
239
$
444
$
354
Cash used by investing activities
$
(215
)
$
(116
)
$
(341
)
$
(263
)
Cash provided (used) by financing
activities
$
(30
)
$
132
$
303
$
587
Operating Highlights4
Q2 2021
Q2 2020
YoY Growth
YoY FX-Neutral
Growth5
Total Customers
3,233,500
3,198,500
1
%
Organic customer adds
18,800
20,600
Total RGUs
6,332,700
6,120,300
3
%
Organic RGU adds (losses)
73,200
18,700
Broadband
24,800
46,700
Video
12,100
(15,800
)
Telephony
36,300
(12,200
)
Mobile subscribers*
4,623,900
3,309,700
40
%
Organic mobile adds (losses)
117,700
(310,100
)
Fixed ARPU
$
49.66
$
46.35
7
%
3
%
Mobile ARPU*
$
19.14
$
11.38
68
%
68
%
* Q2 2021 figures include mobile subscribers and ARPU related to
operations in Puerto Rico and USVI. These operations were acquired
on October 31, 2020 and therefore not included in Q2 2020
subscriber data.
Revenue Highlights
The following table presents (i) revenue of each of our segments
and corporate operations for the periods indicated, and (ii) the
percentage change from period-to-period on both a reported and
rebased basis:
Three months ended
Increase/(decrease)
Six months ended
Increase/(decrease)
June 30,
June 30,
2021
2020
%
Rebased %
2021
2020
%
Rebased %
in millions, except %
amounts
C&W Caribbean & Networks
$
434.2
$
404.9
7
8
$
864.0
$
856.9
1
2
C&W Panama
128.1
112.2
14
15
250.1
250.5
—
—
Liberty Puerto Rico
360.4
109.1
230
11
721.7
213.7
238
13
VTR
209.3
193.1
8
(6
)
419.6
399.5
5
(7
)
Cabletica
36.3
34.6
5
13
72.5
68.3
6
14
Corporate
5.4
—
N.M.
N.M.
10.8
—
N.M.
N.M.
Eliminations
(5.7
)
(5.0
)
N.M.
N.M.
(10.8
)
(9.0
)
N.M.
N.M.
Total
$
1,168.0
$
848.9
38
8
$
2,327.9
$
1,779.9
31
4
N.M. – Not Meaningful.
- Our reported revenue for the three and six months ended June
30, 2021 increased by 38% and 31%, respectively.
- Reported revenue growth in Q2 2021 and H1 2021 was driven by
(1) the addition of $236 million and $476 million, respectively,
from Liberty Mobile, which was acquired on October 31, 2020, (2)
double-digit growth in our legacy Liberty Puerto Rico operations,
(3) organic growth across C&W Caribbean & Networks and, for
the three month comparison, C&W Panama, and (4) net positive
foreign exchange ("FX") impacts of $19 million and $29 million,
respectively. These increases were partially offset by
organic declines in VTR.
Q2 2021 Revenue Growth – Segment
Highlights
- C&W Caribbean & Networks: revenue grew on a reported
and rebased basis by 7% and 8%, respectively, as markets continued
to recover from the initial impacts of COVID-19. The lower reported
growth was primarily driven by adverse currency movements.
- B2B revenue grew 6% on both a reported and rebased basis, as
compared to the prior-year period. Year-over-year growth was driven
by continued recovery in mobile usage and demand for data services
across business customers as economic activity and mobility
improved. The prior year was also negatively impacted by temporary
credits provided to customers. Our subsea network contributed to
year-over-year growth.
- Fixed residential revenue was 4% and 5% higher on a reported
and rebased basis, respectively, as compared to the prior-year
period. Rebased performance continued to be driven by volume growth
as 119,000 RGUs, 8% of the total base, were added over the past
twelve months, over half of which were broadband subscribers.
- Mobile revenue performance was strong in the quarter, up by 16%
on a reported basis and 19% on a rebased basis, as compared to the
prior-year period. The increase was driven by ARPU primarily due to
the relaxing of COVID-19 lockdowns and restrictions in most of our
markets. Inbound roaming revenue was also higher in the quarter
following the relaxing of travel restrictions.
- C&W Panama: revenue increased by 14% on a reported basis
and 15% on a rebased basis as our operations in Panama continued to
recover from the impacts COVID-19.
- B2B revenue was 29% higher on a reported and rebased basis,
primarily due to increased non-recurring revenue, including
Government-related projects responding to COVID-19 and providing
services such as video surveillance. Higher demand from corporate
and Government customers also drove growth in mobile services
revenue.
- Fixed residential revenue was 2% lower on a reported basis and
1% higher on a rebased basis as volume growth was offset by lower
ARPU year-over-year where there was an increase in out-of-bundle
usage in the prior year, and retention activity led to moves to
lower plans.
- Mobile revenue grew 10% on both a reported and rebased basis,
primarily due to a higher average number of mobile subscribers on
prepaid plans and increased volumes of handset sales, as COVID-19
related lockdowns in 2020 negatively impacted customers’ ability to
purchase handsets.
- Liberty Puerto Rico: revenue grew by 230% and 11% on a reported
and rebased basis, respectively. Reported growth benefited from the
inclusion of Liberty Mobile in the quarter. Our legacy Puerto Rico
business delivered double-digit revenue growth driven by volume
growth as we added 124,000 RGUs over the last twelve months while
also increasing ARPU for broadband services as customers moved to
higher tier plans. Liberty Mobile grew by 7% year-over-year on a
rebased basis driven by higher ARPU and increased handset
sales.
- VTR: revenue increased by 8% on a reported basis and declined
by 6% on a rebased basis. The higher reported growth as compared to
the prior-year period was driven by a 13% depreciation of the U.S.
dollar relative to the Chilean peso. We reported a stable fixed
subscriber base in Q2, however, carryover effects from subscriber
losses during the second half of 2020 continued to impact rebased
revenue performance. ARPU was relatively flat year-over-year on an
FX-neutral basis as competitive intensity leading to discounting of
bundles was offset by higher video ARPU as premium sports
resumed.
- Cabletica: revenue grew by 5% and 13% on a reported and rebased
basis, respectively. This was driven by increased broadband
subscribers and ARPU growth.
Operating Income (Loss)
- Operating income (loss) was $160 million and ($206 million) for
the three months ended June 30, 2021 and 2020, respectively, and
$338 million and ($98 million) for the six months ended June 30,
2021 and 2020, respectively.
- We reported operating income during the three and six months
ended June 30, 2021, as compared with operating losses for the
corresponding periods during 2020, primarily driven by the benefits
of (i) increases in Adjusted OIBDA, as further discussed below, and
(ii) lower impairment, restructuring and other operating items,
net, as we incurred impairment charges totaling $276 million during
the second quarter of 2020 at C&W Panama and various reporting
units within the C&W Caribbean and Networks segment.
Adjusted OIBDA Highlights
The following table presents (i) Adjusted OIBDA of each of our
reportable segments and our corporate category for the periods
indicated, and (ii) the percentage change from period-to-period on
both a reported and rebased basis:
Three months ended
Increase (decrease)
Six months ended
Increase (decrease)
June 30,
June 30,
2021
2020
%
Rebased %
2021
2020
%
Rebased %
in millions, except %
amounts
C&W Caribbean & Networks
$
188.1
$166.7
13
14
$
369.4
$
353.7
4
5
C&W Panama
45.6
36.9
24
24
89.6
82.7
8
9
Liberty Puerto Rico
161.4
52.4
208
21
311.3
102.9
203
24
VTR
68.7
73.1
(6
)
(18
)
139.2
153.2
(9
)
(19
)
Cabletica
12.7
13.2
(4
)
3
26.8
26.5
1
9
Corporate
(12.5
)
(9.7
)
(29
)
(29
)
(23.0
)
(22.5
)
(2
)
(2
)
Total
$
464.0
$332.6
40
10
$
913.3
$
696.5
31
6
Operating income margin
13.7
%
(24.3
)
%
14.5
%
(5.5
)
%
Adjusted OIBDA margin
39.7
%
39.2
%
39.2
%
39.1
%
- Our reported Adjusted OIBDA for the three and six months ended
June 30, 2021 increased by 40% and 31%, respectively.
- Reported Adjusted OIBDA increases in Q2 2021 and H1 2021 were
largely driven by (1) the addition of $98 million and $184 million,
respectively, contributed by Liberty Mobile (2) strong organic
growth in our legacy Liberty Puerto Rico operations, C&W
Caribbean & Networks and C&W Panama, and (3) net positive
FX impacts of $5 million and $9 million, respectively. These
increases were partially offset by declines in VTR.
Q2 2021 Adjusted OIBDA Growth – Segment
Highlights
- C&W Caribbean and Networks: Adjusted OIBDA increased on a
reported and rebased basis by 13% and 14%, respectively. Rebased
growth was driven by the aforementioned rebased revenue
performance, combined with robust cost management as Adjusted OIBDA
margin improved by over 200 basis points (on a reported basis)
year-over-year. Direct costs were higher year-over-year as (i)
certain premium programming had been postponed in the prior-year
period due to the pandemic, and (ii) we had higher equipment sales
in the current year as COVID-19 related restrictions were eased.
Other operating costs and expenses rose overall as reduced bad debt
charges and lower personnel costs due to ongoing restructuring
activities were more than offset by increased network costs and
higher marketing and sales costs from promotional activities, which
had been reduced in the prior year period.
- C&W Panama: Adjusted OIBDA was 24% higher on a reported and
rebased basis. Performance was driven by the aforementioned revenue
growth, and cost management with Adjusted OIBDA margin improving by
over 250 basis points (on a reported basis) year-over-year. Direct
costs increased due to the higher non-recurring project revenue and
equipment sales. Other operating costs and expenses reduced
year-over-year as lower bad debt provisions more than offset
increased personnel costs as operating activity recovered.
- Liberty Puerto Rico: reported and rebased Adjusted OIBDA growth
of 208% and 21%, respectively. Reported growth was driven by the
inclusion of Liberty Mobile in the quarter. For our legacy
operations, rebased growth was driven by the previously mentioned
revenue growth, partly offset by (i) annual increases in
programming rates and (ii) higher labor and commercial costs.
Liberty Mobile reported double-digit rebased Adjusted OIBDA growth
driven by revenue growth and lower overall costs. We have incurred
modest integration costs of $3 million related to the Liberty
Mobile acquisition year-to-date, and anticipate these will increase
in the second half as we expect to spend a total of approximately
$20 million in 2021.
- VTR: Adjusted OIBDA declined on a reported and rebased basis by
6% and 18%, respectively. The lower reported year-over-year decline
was driven by a depreciation of the U.S. dollar relative to the
Chilean peso. The rebased Adjusted OIBDA decline was driven by the
aforementioned revenue impacts and higher costs. Direct costs
increased as higher content costs were only partly offset by
reduced MVNO rates. Other operating costs and expenses were lower
in the quarter, as lower bad debt provisions and cost savings from
a restructuring program implemented earlier in the year were partly
offset by increased network activities.
- Cabletica: reported Adjusted OIBDA decline of 4% and rebased
growth of 3%. Rebased growth was driven by the previously mentioned
revenue growth.
Net Earnings (Loss) Attributable to Shareholders
- Net earnings (loss) attributable to shareholders was $4 million
and ($393 million) for the three months ended June 30, 2021 and
2020, respectively, and $92 million and ($574 million) for the six
months ended June 30, 2021 and 2020, respectively.
Property & Equipment Additions and Capital Expenditures
The table below highlights the categories of the property and
equipment additions (P&E Additions) for the indicated periods
and reconciles to cash paid for capital expenditures.
Three months ended
Six months ended
June 30,
June 30,
2021
2020
2021
2020
USD in millions
Customer Premises Equipment
$
77.5
$
56.9
$
151.1
$
124.0
New Build & Upgrade
33.1
29.0
58.6
57.2
Capacity
36.6
22.0
53.7
28.1
Baseline
44.7
26.6
71.6
46.2
Product & Enablers
22.8
18.8
32.1
30.7
Property & equipment additions
214.7
153.3
367.1
286.2
Assets acquired under capital-related
vendor financing arrangements
(19.5
)
(29.7
)
(38.3
)
(53.3
)
Changes in current liabilities related to
capital expenditures
3.4
(1.4
)
5.4
38.5
Capital expenditures
$
198.6
$
122.2
$
334.2
$
271.4
Property & equipment additions as % of
revenue
18.4
%
18.1
%
15.8
%
16.1
%
Property & Equipment Additions:
C&W Caribbean & Networks
$
73.2
$
63.7
$
122.8
$
121.0
C&W Panama
20.1
17.8
30.8
31.0
Liberty Puerto Rico
51.2
19.6
84.9
32.9
VTR
55.8
43.3
102.5
84.2
Cabletica
7.3
6.9
14.6
10.9
Corporate
7.1
2.0
11.5
6.2
Property & equipment additions
$
214.7
$
153.3
$
367.1
$
286.2
Property & Equipment Additions as a
Percentage of Revenue by Reportable Segment:
C&W Caribbean & Networks
16.9
%
15.7
%
14.2
%
14.1
%
C&W Panama
15.7
%
15.9
%
12.3
%
12.4
%
Liberty Puerto Rico
14.2
%
18.0
%
11.8
%
15.4
%
VTR
26.7
%
22.4
%
24.4
%
21.1
%
Cabletica
20.1
%
19.9
%
20.1
%
16.0
%
New Build and Homes Upgraded by Reportable
Segment:
C&W Caribbean & Networks
41,700
17,700
62,700
34,900
C&W Panama
38,700
36,500
60,200
61,700
Liberty Puerto Rico
6,600
6,200
8,700
13,400
VTR
134,600
4,600
211,300
33,900
Cabletica
9,700
7,100
16,300
8,600
Total
231,300
72,100
359,200
152,500
Summary of Debt, Finance Lease Obligations and Cash and Cash
Equivalents
The following table details the U.S. dollar equivalent balances
of the outstanding principal amounts of our debt and finance lease
obligations, and cash and cash equivalents at June 30, 2021:
Debt
Finance lease
obligations
Debt and
finance lease
obligations
Cash and cash
equivalents
in millions
Liberty Latin America1
$
404.7
$
1.1
$
405.8
$
411.0
C&W2
4,196.7
0.8
4,197.5
534.3
Liberty Puerto Rico
2,610.0
10.8
2,620.8
112.8
VTR
1,595.6
—
1,595.6
247.5
Cabletica
126.9
—
126.9
5.5
Total
$
8,933.9
$
12.7
$
8,946.6
$
1,311.1
Consolidated Leverage and Liquidity
Information:
June 30, 2021
March 31, 2021
Consolidated gross leverage ratio3
5.0x
5.0x
Consolidated net leverage ratio3
4.2x
4.3x
Average debt tenor4
6.3 years
6.5 years
Fully-swapped borrowing costs
6.0%
6.0%
Unused borrowing capacity (in
millions)5
$1,210.6
$1,219.7
(1)
Represents the amount held by Liberty
Latin America on a standalone basis plus the aggregate amount held
by subsidiaries of Liberty Latin America that are outside our
borrowing groups.
(2)
Represents the C&W borrowing group,
including the C&W Caribbean & Networks and C&W Panama
reporting segments.
(3)
Consolidated leverage ratios are non-GAAP
measures. For additional information, including definitions of our
consolidated leverage ratios, required reconciliations and the
impact of Liberty Mobile on the ratios, see Non-GAAP
Reconciliations below.
(4)
For purposes of calculating our average
tenor, total debt excludes vendor financing and finance lease
obligations.
(5)
At June 30, 2021, the full amount of
unused borrowing capacity under our subsidiaries' revolving credit
facilities was available to be borrowed, both before and after
completion of the June 30, 2021 compliance reporting requirements.
For information regarding limitations on our ability to access this
liquidity, see the discussion under “Material Changes in Financial
Condition” in our recently filed Quarterly Report on Form 10-Q.
Quarterly Subscriber Variance
Fixed and Mobile Subscriber
Variance Table — June 30, 2021 vs March 31, 2021
Homes Passed
Two-way Homes Passed
Fixed-line Customer
Relationships
Video RGUs
Internet RGUs
Telephony RGUs
Total RGUs
Prepaid
Postpaid
Total Mobile
Subscribers
C&W Caribbean &
Networks:
Jamaica
7,900
7,900
9,700
2,400
11,200
12,700
26,300
50,400
4,500
54,900
The Bahamas
—
—
2,300
700
1,300
900
2,900
(2,800
)
400
(2,400
)
Trinidad and Tobago
1,000
1,000
200
(900
)
—
1,000
100
—
—
—
Barbados
—
—
300
1,000
900
300
2,200
2,000
900
2,900
Other
400
400
(2,600
)
(100
)
(400
)
700
200
(1,100
)
3,800
2,700
Total C&W Caribbean & Networks
9,300
9,300
9,900
3,100
13,000
15,600
31,700
48,500
9,600
58,100
C&W Panama
26,800
26,800
(600
)
2,200
3,800
2,800
8,800
52,800
7,300
60,100
Total C&W
36,100
36,100
9,300
5,300
16,800
18,400
40,500
101,300
16,900
118,200
Liberty Puerto Rico
6,400
6,400
16,300
3,800
12,600
5,400
21,800
(5,000
)
11,000
6,000
VTR
117,000
130,500
(11,000
)
2,000
(11,200
)
9,200
—
(700
)
(5,800
)
(6,500
)
Cabletica
7,800
7,800
4,200
1,000
6,600
3,300
10,900
—
—
—
Total Net Adds
167,300
180,800
18,800
12,100
24,800
36,300
73,200
95,600
22,100
117,700
Q2 2021
Adjustments:
VTR1
—
—
(2,700
)
(300
)
(400
)
(2,100
)
(2,800
)
—
—
—
Net Adds
167,300
180,800
16,100
11,800
24,400
34,200
70,400
95,600
22,100
117,700
- VTR's non-organic adjustment relates to RGUs that were
disconnected prior to April 1, 2021.
C&W Caribbean &
Networks
- Fixed additions led by Jamaica with 26,000 RGUs added in the
quarter and close to 100,000 over the last twelve months.
- Mobile subscribers grew by 58,000, a significant swing as
compared to the prior year quarter where COVID-19 led to a loss in
subscribers. The result also represented an improvement compared to
our seasonally soft Q1. Jamaica drove the segment performance with
55,000 net additions.
C&W Panama
- Panama continued to grow its RGU base, adding 9,000 subscribers
in the quarter.
- Mobile operations delivered a consistent and strong quarter
with 60,000 subscriber additions. Panama has now added over 200,000
subscribers in the last twelve months following a significant loss
in Q2 2020.
Liberty Puerto Rico
- Fixed additions of 22,000 RGUs represented continuing momentum
in Puerto Rico with growth led by increased broadband
penetration.
- Liberty Mobile delivered 6,000 net subscriber additions, with
gains in postpaid more than offsetting a small loss in
prepaid.
VTR
- VTR's RGU base was stable in the quarter. We continue to expand
our footprint in Chile with a focus on differentiated customer
service and products.
- We reported 7,000 fewer mobile subscribers in Q2 as COVID-19
continued to impact retail activity.
Cabletica
- RGU additions in Cabletica totaled 11,000 and were up 70%
year-over-year as broadband penetration continued to drive the
business.
ARPU per Customer Relationship
The following table provides ARPU per customer relationship for
the indicated periods:
Three months ended June
30,
FX-Neutral1
2021
2020
% Change
% Change
Liberty Latin America2
$
49.66
$
46.35
7.1
%
2.7
%
C&W Caribbean and Networks
$
48.35
$
48.83
(1.0
%)
0.7
%
C&W Panama2
$
37.62
$
41.74
(9.9
%)
(9.9
%)
Liberty Puerto Rico
$
77.51
$
77.69
(0.2
%)
(0.2
%)
VTR3
$
43.75
$
37.51
16.6
%
1.6
%
Cabletica4
$
42.19
$
43.16
(2.2
%)
5.2
%
Cable & Wireless Borrowing Group2
$
46.33
$
47.60
(2.7
%)
(1.3
%)
Mobile ARPU
The following table provides ARPU per mobile subscriber for the
indicated periods:
Three months ended June
30,
FX-Neutral1
2021
2020
% Change
% Change
Liberty Latin America5
$
19.14
$
11.38
68.2
%
68.1
%
C&W Caribbean and Networks
$
14.55
$
13.13
10.8
%
13.0
%
C&W Panama
$
8.45
$
8.50
(0.6
%)
(0.6
%)
Liberty Puerto Rico
$
43.89
$
—
N.M.
N.M.
VTR6
$
15.97
$
15.22
4.9
%
(8.6
%)
Cable & Wireless Borrowing Group
$
11.66
$
11.01
5.9
%
7.2
%
N.M. – Not Meaningful.
(1)
The FX-Neutral change represents the
percentage change on a year-over-year basis adjusted for FX impacts
and is calculated by adjusting the current-period figures to
reflect translation at the foreign currency rates used to translate
the prior year amounts
(2)
ARPU per customer relationship for the
three months ended June 30, 2020 has been revised to exclude
revenue and customer relationships associated with the DTH
operations in Panama that were shut down in January 2021.
(3)
The ARPU per customer relationship amounts
in Chilean pesos for the three months ended June 30, 2021 and 2020
are CLP 31,328 and CLP 30,830, respectively.
(4)
The ARPU per customer relationship amounts
in Costa Rican colones for Cabletica for the three months ended
June 30, 2021 and 2020 are CRC 26,014 and CRC 24,730,
respectively.
(5)
The amount for the three months ended June
30, 2020 does not include the revenue and mobile subscribers of
Liberty Mobile as the business was acquired on October 31, 2020.
Excluding Liberty Mobile in the three months ended June 30, 2021,
ARPU would have increased year-over-year by 5.3% on a reported
basis and 5.2% on an FX-Neutral basis.
(6)
The mobile ARPU amounts in Chilean pesos
for the three months ended June 30, 2021 and 2020 are CLP 11,433
and CLP 12,510, respectively.
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 regarding our strategies, priorities and
objectives, performance and guidance, growth expectations, and
Adjusted Free Cash Flow expectations for 2021; expected new build
and upgrade activity in 2021 and estimated P&E additions as a
percent of revenue; the anticipated impact of the COVID-19 pandemic
(including the rollout of vaccines) on our business and financial
results, and for the countries in which we operate; our digital
strategy, product innovation and commercial plans and projects;
expectations on demand for connectivity in the region; our
anticipated integration plans, synergies, opportunities and
integration costs in Puerto Rico following the AT&T
Acquisition; the timing and impact of the acquisition of
Telefónica's Costa Rica business; 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, political or social events, and pandemics, such as
COVID-19, the uncertainties surrounding such events and efforts to
contain any pandemic, the ability and cost to restore networks in
the markets impacted by hurricanes or generally to respond to any
such events; 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, including the acquisition of
Telefónica's Costa Rica business; 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 communications company
operating in over 20 countries across Latin America and the
Caribbean under the consumer brands VTR, Flow, Liberty, Más Móvil,
BTC, 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
- Rebased growth rates are a non-GAAP measure. The indicated
growth rates are rebased for the estimated impacts of (i)
acquisitions, (ii) dispositions and (iii) FX. See Non-GAAP
Reconciliations below.
- Adjusted OIBDA is a non-GAAP measure. For the definition of
Adjusted OIBDA and required reconciliations, see Non-GAAP
Reconciliations below.
- Adjusted Free Cash Flow (“Adjusted FCF”) is a non-GAAP measure.
For the definition of Adjusted FCFand required reconciliations, see
Non-GAAP Reconciliations below.
- See Glossary for the definition of RGUs and mobile subscribers.
Organic figures exclude RGUs and mobile subscribers of acquired
entities at the date of acquisition and other nonorganic
adjustments, but include the impact of changes in RGUs and mobile
subscribers from the date of acquisition. All subscriber / RGU
additions or losses refer to net organic changes, unless otherwise
noted.
- The FX-Neutral change represents the percentage change on a
year-over-year basis adjusted for FX impacts and is calculated by
adjusting the current-year figures to reflect translation at the
foreign currency rates used to translate the prior year
amounts.
Additional Information | Cable & Wireless Borrowing
Group
The following tables reflect preliminary unaudited selected
financial results, on a consolidated C&W basis, for the periods
indicated, in accordance with U.S. GAAP.
Three months ended
June 30,
Change
Rebased change1
2021
2020
in millions, except %
amounts
Residential revenue:
Residential fixed revenue:
Subscription revenue:
Video
$
39.6
$
42.7
Broadband internet
78.5
70.5
Fixed-line telephony
21.3
24.2
Total subscription revenue
139.4
137.4
Non-subscription revenue
13.8
11.3
Total residential fixed revenue
153.2
148.7
3
%
5
%
Residential mobile revenue:
Service revenue
114.4
104.4
Interconnect, equipment sales and
other
25.3
18.3
Total residential mobile revenue
139.7
122.7
14
%
15
%
Total residential revenue
292.9
271.4
8
%
9
%
B2B revenue:
Service revenue
206.0
183.5
Subsea network revenue
60.7
60.4
Total B2B revenue
266.7
243.9
9
%
9
%
Total
$
559.6
$
515.3
9
%
9
%
Operating income (loss)
$
67.1
$
(245.7
)
(127
)%
Adjusted OIBDA
$
233.7
$
203.6
15
%
16
%
Operating income (loss) as a percentage of
revenue
12.0
%
(47.7
)%
Adjusted OIBDA as a percentage of
revenue
41.8
%
39.5
%
Proportionate Adjusted OIBDA
$
199.8
$
177.5
Six months ended
June 30,
Change
Rebased change1
2021
2020
in millions, except %
amounts
Residential revenue:
Residential fixed revenue:
Subscription revenue:
Video
$
80.1
$
87.6
Broadband internet
155.8
141.5
Fixed-line telephony
42.1
48.5
Total subscription revenue
278.0
277.6
Non-subscription revenue
27.0
28.2
Total residential fixed revenue
305.0
305.8
—
%
2
%
Residential mobile revenue:
Service revenue
225.5
227.4
Interconnect, equipment sales and
other
47.0
43.8
Total residential mobile revenue
272.5
271.2
—
%
2
%
Total residential revenue
577.5
577.0
—
%
2
%
B2B revenue:
Service revenue
404.9
396.9
Subsea network revenue
127.1
130.0
Total B2B revenue
532.0
526.9
1
%
1
%
Total
$
1,109.5
$
1,103.9
1
%
1
%
Operating income (loss)
$
135.1
$
(188.1
)
(172
)%
Adjusted OIBDA
$
459.0
$
436.4
5
%
6
%
Operating income (loss) as a percentage of
revenue
12.2
%
(17.0
)%
Adjusted OIBDA as a percentage of
revenue
41.4
%
39.5
%
Proportionate Adjusted OIBDA
$
392.0
$
378.2
1. Indicated growth rates are rebased for
the estimated impacts of an acquisition, the shut down of our DTH
operations in Panama and FX.
The following table details the 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
2021
2021
in millions
Credit Facilities:
Revolving Credit Facility due 2023 (LIBOR
+ 3.25%)
$
50.0
$
—
$
—
Revolving Credit Facility due 2026 (LIBOR
+ 3.25%)
$
580.0
—
—
Term Loan Facility B-5 due 2028 (LIBOR +
2.25%)
$
1,510.0
1,510.0
1,510.0
Total Senior Secured Credit Facilities
1,510.0
1,510.0
Notes:
Senior Secured Notes:
5.75% USD Senior Secured Notes due
2027
$
550.0
550.0
550.0
Senior Notes:
7.5% USD Senior Notes due 2026
$
500.0
500.0
500.0
6.875% USD Senior Notes due 2027
$
1,220.0
1,220.0
1,220.0
Total Notes
2,270.0
2,270.0
Other Regional Debt
342.9
344.1
Vendor financing
73.8
69.8
Finance lease obligations
0.8
1.2
Total third-party debt and finance
lease obligations
4,197.5
4,195.1
Less: premiums, discounts and deferred
financing costs, net
(28.0
)
(28.9
)
Total carrying amount of third-party
debt and finance lease obligations
4,169.5
4,166.2
Less: cash and cash equivalents
(534.3
)
(474.7
)
Net carrying amount of third-party debt
and finance lease obligations
$
3,635.2
$
3,691.5
- At June 30, 2021, our third-party total and proportionate net
debt was $3.6 billion, our Fully-swapped Borrowing Cost was 5.6%,
and the average tenor of our debt obligations (excluding vendor
financing) was approximately 6.0 years.
- Our portion of Adjusted OIBDA, after deducting the
noncontrolling interests' share, (“Proportionate Adjusted OIBDA”)
was $200 million for Q2 2021 and $178 million for Q2 2020.
- Based on Q2 results, our Proportionate Net Leverage Ratio was
4.3x, calculated in accordance with C&W's Credit Agreement. At
June 30, 2021, we had maximum undrawn commitments of $775 million,
including $145 million under our regional facilities. At June 30,
2021, the full amount of unused borrowing capacity under our credit
facilities (including regional facilities) was available to be
borrowed, both before and after completion of the June 30, 2021
compliance reporting requirements.
- We expect P&E additions as a percentage of revenue in 2021
to be approximately 16%, at the upper end of our previously
announced range.
Liberty Puerto Rico (LPR) Borrowing Group
The following table details the nominal amount outstanding of
Liberty Puerto Rico's debt, finance lease obligations and cash and
cash equivalents:
June 30,
March 31,
Facility amount
2021
2021
in millions
Credit Facilities:
Revolving Credit Facility due 2027 (LIBOR
+ 3.50%)
$
167.5
$
—
$
—
Term Loan Facility due 2028 (LIBOR +
3.75%)
$
500.0
500.0
500.0
Total Senior Secured Credit Facilities
500.0
500.0
Notes:
5.125% Senior Secured Notes due 2029
$
820.0
820.0
820.0
6.75% Senior Secured Notes due 2027
$
1,290.0
1,290.0
1,290.0
Total Notes
2,110.0
2,110.0
Finance lease obligations
10.8
10.8
Total debt and finance lease
obligations
2,620.8
2,620.8
Less: discounts and deferred financing
costs
(39.2
)
(39.9
)
Total carrying amount of debt
2,581.6
2,580.9
Less: cash and cash equivalents
(112.8
)
(128.1
)
Net carrying amount of debt
$
2,468.8
$
2,452.8
- At June 30, 2021, our Fully-swapped Borrowing Cost was 6.1% and
the average tenor of debt was approximately 7.0 years.
- Based on our results for Q2 2021, and subject to the completion
of the corresponding compliance reporting requirements, our
Consolidated Net Leverage Ratio was 3.8x, calculated in accordance
with LPR’s Group Credit Agreement.
- At June 30, 2021, we had maximum undrawn commitments of $168
million. At June 30, 2021, the full amount of unused borrowing
capacity under our revolving credit facility was available to be
borrowed, both before and after completion of the June 30, 2021
compliance reporting requirements.
VTR Borrowing Group
The following table reflects preliminary unaudited selected
financial results for the period indicated, in accordance with U.S.
GAAP.
Three months ended
Six months ended
June 30,
June 30,
2021
2020
Change
2021
2020
Change
CLP in billions, except %
amounts
Revenue
150.0
158.7
(6
)%
302.2
324.4
(7
)%
Operating income
5.3
25.0
(79
)%
18.7
52.9
(65
)%
Adjusted OIBDA
49.4
60.2
(18
)%
100.3
124.3
(19
)%
Operating income as a percentage of
revenue
3.5
%
15.8
%
6.2
%
16.3
%
Adjusted OIBDA as a percentage of
revenue
32.9
%
37.9
%
33.2
%
38.3
%
The following table details the borrowing currency and Chilean
peso equivalent of the nominal amount outstanding of VTR's debt and
cash and cash equivalents:
June 30,
March 31,
2021
2021
Borrowing currency in
millions
CLP equivalent in
billions
Credit Facilities:
Revolving Credit Facility A due 2026
(TAB1+3.35%)
CLP 45,000
—
—
Revolving Credit Facility B due 2026
(LIBOR + 2.75%)
$
200.0
—
—
Total Senior Secured Credit Facilities
—
—
Notes:
Senior Secured Notes:
4.375% USD Senior Secured Notes due
2029
$
410.0
300.2
294.7
5.125% USD Senior Secured Notes due
2028
$
540.0
395.4
388.1
Senior Notes:
6.375% USD Senior Notes due 2028
$
550.0
402.7
395.3
Total Notes
1,098.3
1,078.1
Vendor Financing
70.0
70.0
Total debt
1,168.3
1,148.1
Less: deferred financing costs
(19.4)
(17.4)
Total carrying amount of debt
1,148.9
1,130.7
Less: cash and cash equivalents
(181.3)
(99.6)
Net carrying amount of debt
967.6
1,031.1
Exchange rate (CLP to $)
732.2
718.7
1. Tasa Activa Bancaria rate.
- At June 30, 2021, our Fully-swapped Borrowing Cost was 5.8% and
the average tenor of debt (excluding vendor financing) was
approximately 7.1 years.
- Based on our results for Q2 2021, and subject to the completion
of the corresponding compliance reporting requirements, our
Consolidated Net Leverage ratio was 5.1x, calculated in accordance
with the indenture governing the 6.375% USD Senior Notes due
2028.
- At June 30, 2021, we had maximum undrawn commitments of $200
million (CLP 146 billion) and CLP 45 billion. At June 30, 2021, the
full amount of unused borrowing capacity under our credit
facilities was available to be borrowed, both before and after
completion of the June 30, 2021 compliance reporting
requirements.
Cabletica Borrowing Group
The following table details the borrowing currency and Costa
Rican colón equivalent of the nominal amount outstanding of
Cabletica's debt and cash and cash equivalents:
June 30,
March 31,
2021
2021
Borrowing currency in
millions
CRC equivalent in
billions
Term Loan B-1 Facility due 20241 (LIBOR +
5.50%)
$
49.2
30.5
30.1
Term Loan B-2 Facility due 20241 (TBP2 +
6.75%)
CRC 43,177.4
43.2
43.2
Revolving Credit Facility due 2024 (LIBOR
+ 4.25%)
$
15.0
5.0
—
Debt before discounts and deferred
financing costs
78.7
73.3
Less: deferred financing costs
(3.7
)
(3.9
)
Total carrying amount of debt
75.0
69.4
Less: cash and cash equivalents
(3.4
)
(4.4
)
Net carrying amount of debt
71.6
65.0
Exchange rate (CRC to $)
619.3
612.3
(1)
Under the terms of the credit agreement,
Cabletica is obligated to repay 50% of the outstanding aggregate
principal amounts of the Cabletica Term Loan B-1 Facility and the
Cabletica Term Loan B-2 Facility on February 1, 2024, with the
remaining respective principal amounts due on August 1, 2024, which
represents the ultimate maturity date of the facilities.
(2)
Tasa Básica Pasiva rate.
Subscriber Table
Consolidated Operating Data —
June 30, 2021
Homes Passed
Two-way Homes Passed
Fixed-line Customer
Relationships
Video RGUs
Internet RGUs
Telephony RGUs
Total RGUs
Prepaid
Postpaid
Total Mobile
Subscribers
C&W Caribbean &
Networks
Jamaica
629,000
629,000
313,000
132,700
279,900
269,900
682,500
1,027,600
29,700
1,057,300
The Bahamas
120,900
120,900
37,100
8,700
29,100
34,600
72,400
144,600
33,100
177,700
Trinidad and Tobago
336,200
336,200
157,700
105,300
141,500
88,300
335,100
—
—
—
Barbados
140,400
140,400
82,900
35,400
71,200
71,300
177,900
86,100
31,700
117,800
Other
334,000
314,200
229,100
74,700
180,100
119,900
374,700
338,300
55,600
393,900
Total C&W Caribbean & Networks
1,560,500
1,540,700
819,800
356,800
701,800
584,000
1,642,600
1,596,600
150,100
1,746,700
C&W Panama1
730,900
730,900
188,000
93,500
164,800
166,000
424,300
1,451,400
131,700
1,583,100
Total C&W
2,291,400
2,271,600
1,007,800
450,300
866,600
750,000
2,066,900
3,048,000
281,800
3,329,800
Liberty Puerto Rico2,3
1,146,400
1,146,400
508,600
242,200
462,100
247,700
952,000
229,200
797,500
1,026,700
VTR
4,041,600
3,632,200
1,441,600
1,068,900
1,266,300
517,300
2,852,500
10,100
257,300
267,400
Cabletica4
647,400
641,500
275,500
207,500
227,300
26,500
461,300
—
—
—
Total
8,126,800
7,691,700
3,233,500
1,968,900
2,822,300
1,541,500
6,332,700
3,287,300
1,336,600
4,623,900
(1)
RGU balances do not include 77,600 RGUs
and 15,100 mobile subscribers that, due to the impact of COVID-19,
have not been disconnected in accordance with our normal disconnect
policy for non-payment and continue to receive services.
(2)
RGU balances do not include 14,700 fixed
RGUs representing customers that, due to the impact of COVID-19,
have not been disconnected in accordance with our normal disconnect
policy for non-payment and were moved to an "essential services
plan".
(3)
As of June 30, 2021, postpaid mobile
subscribers include 127,300 Corporate Responsible Users
(CRU). A CRU represents an individual receiving mobile
services through an organization that has entered into a contract
for mobile services with us and where the organization is
responsible for the payment of the CRU’s mobile services. Mobile
subscriber information associated with Liberty Mobile 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.
(4)
Our homes passed in Costa Rica include
40,000 homes on a third-party network that provides us long-term
access.
Glossary
Adjusted OIBDA Margin – Calculated by dividing Adjusted
OIBDA by total revenue for the applicable period.
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 the average monthly
mobile service revenue 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 average
RGU is calculated by dividing the average monthly subscription
revenue from the applicable residential fixed service by the
average of the opening and closing balances of the applicable RGUs
for the indicated 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 cross-currency swaps) less its cash and cash
equivalents to its annualized EBITDA from the most recent two
consecutive fiscal quarters.
Consolidated Net Leverage Ratio (LPR) – Defined in
accordance with LPR's Group Credit Agreement, taking into account
the ratio of its outstanding indebtedness less its cash and cash
equivalents to its annualized EBITDA from the most recent two
consecutive fiscal quarters. Annualized EBITDA includes pro forma
EBITDA of Liberty Mobile for pre-acquisition periods.
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. 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.
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 (Broadband) RGU – A home, residential multiple
dwelling unit or commercial unit that receives internet services
over our network.
Leverage – Our gross and net leverage ratios, each a
non-GAAP measure, 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 Adjusted OIBDA 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.
Property and Equipment Addition Categories
- Customer Premises Equipment: Includes capitalizable equipment
and labor, materials and other costs directly associated with the
installation of such CPE;
- New Build & Upgrade: Includes capitalizable costs of
network equipment, materials, labor and other costs directly
associated with entering a new service area and upgrading our
existing network;
- Capacity: Includes capitalizable costs for network capacity
required for growth and services expansions from both existing and
new customers. This category covers Core and Access parts of the
network and includes, for example, fiber node splits,
upstream/downstream spectrum upgrades and optical equipment
additions in our international backbone connections;
- Baseline: Includes capitalizable costs of equipment, materials,
labor and other costs directly associated with maintaining and
supporting the business. Relates to areas such as network
improvement, property and facilities, technical sites, information
technology systems and fleet; and
- Product & Enablers: Discretionary capitalizable costs that
include investments (i) required to support, maintain, launch or
innovate in new customer products, and (ii) in infrastructure,
which drive operational efficiency over the long term.
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
RGU, internet RGU or telephony RGU. 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
video, 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 RGUs 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 RGU – A home, residential multiple dwelling
unit or commercial unit that receives voice services over our
network. Telephony RGUs exclude mobile 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 RGU – A home, residential multiple dwelling unit or
commercial unit that receives our video service over our network
primarily via a digital video signal while subscribing to any
recurring monthly service that requires the use of
encryption-enabling technology. Video RGUs 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
RGU.
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 and 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 and homes passed 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.
Non-GAAP Reconciliations
We include certain financial measures in this press release that
are considered non-GAAP measures, including (i) Adjusted OIBDA,
Adjusted OIBDA Margin and Adjusted OIBDA less P&E Additions,
(ii) Adjusted Free Cash Flow, (iii) rebased revenue and rebased
Adjusted OIBDA growth rates, and (iv) consolidated leverage ratios.
The following sections set forth reconciliations of the nearest
GAAP measure to our non-GAAP measures as well as information on how
and why management of the Company believes such information is
useful to an investor.
Adjusted OIBDA and Adjusted OIBDA less P&E Additions
Adjusted OIBDA and Adjusted OIBDA less P&E Additions, each a
non-GAAP measure, are the primary measures used by our chief
operating decision maker to evaluate segment operating performance.
Adjusted OIBDA and Adjusted OIBDA less P&E Additions are also
key factors that are 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, Adjusted OIBDA is defined
as operating income or loss before share-based compensation,
depreciation and amortization, 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 Adjusted OIBDA
and Adjusted OIBDA less P&E Additions are meaningful measures
because they represent 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
Adjusted OIBDA and Adjusted OIBDA less P&E Additions measures
are useful to investors because they are one of the bases for
comparing our performance with the performance of other companies
in the same or similar industries, although our measures may not be
directly comparable to similar measures used by other public
companies. Adjusted OIBDA and Adjusted OIBDA less P&E Additions
should be viewed as measures of operating performance that are a
supplement to, and not a substitute for, operating income or loss,
net earnings or loss and other U.S. GAAP measures of income. A
reconciliation of our operating income or loss to total Adjusted
OIBDA and Adjusted OIBDA less P&E Additions are presented in
the following table:
Three months ended
Six months ended
June 30,
June 30,
2021
2020
2021
2020
in millions
Operating income (loss)
$
160.2
$
(206.0
)
$
338.4
$
(98.2
)
Share-based compensation expense
32.8
23.5
55.8
47.3
Depreciation and amortization
254.0
216.4
499.9
429.9
Impairment, restructuring and other
operating items, net
17.0
298.7
19.2
317.5
Adjusted OIBDA
464.0
332.6
913.3
696.5
Less: Property and equipment additions
214.7
153.3
367.1
286.2
Adjusted OIBDA less P&E additions
$
249.3
$
179.3
$
546.2
$
410.3
Operating income (loss) margin1
13.7
%
(24.3
)%
14.5
%
(5.5
)%
Adjusted OIBDA margin2
39.7
%
39.2
%
39.2
%
39.1
%
(1)
Calculated by dividing operating income or
loss by total revenue for the applicable period.
(2)
Calculated by dividing Adjusted OIBDA by
total revenue for the applicable period.
Adjusted Free Cash Flow Definition and Reconciliation
We define Adjusted Free Cash Flow (Adjusted FCF), a non-GAAP
measure, 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, (iii) insurance recoveries
related to damaged and destroyed property and equipment, and (iv)
certain net interest payments (receipts) incurred or received,
including associated derivative instrument payments and receipts,
in advance of a significant acquisition, 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. 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 condensed
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
period:
Three months ended
Six months ended
June 30,
June 30,
2021
2020
2021
2020
in millions
Net cash provided by operating
activities
$
240.2
$
238.7
$
443.7
$
353.6
Cash payments for direct acquisition and
disposition costs
5.6
2.8
10.2
4.2
Expenses financed by an intermediary1
28.4
19.6
54.4
52.1
Capital expenditures
(198.6
)
(122.2
)
(334.2
)
(271.4
)
Distributions to noncontrolling interest
owners
(1.3
)
—
(1.3
)
(0.7
)
Principal payments on amounts financed by
vendors and intermediaries
(45.4
)
(47.9
)
(87.9
)
(91.7
)
Pre-acquisition interest payments,
net2
6.6
39.2
8.8
36.2
Principal payments on finance leases
(0.5
)
(0.5
)
(1.0
)
(1.1
)
Adjusted FCF
$
35.0
$
129.7
$
92.7
$
81.2
(1)
For purposes of our condensed consolidated
statements of cash flows, expenses, including value-added taxes,
financed by an intermediary are treated as hypothetical operating
cash outflows and hypothetical financing cash inflows when the
expenses are incurred. When we pay the financing intermediary, we
record financing cash outflows in our condensed consolidated
statements of cash flows. For purposes of our Adjusted FCF
definition, we add back the hypothetical operating cash outflows
when these financed expenses are incurred and deduct the financing
cash outflows when we pay the financing intermediary.
(2)
The amount for the 2021 period relates to
(i) the Cabletica Term Loan B-1 Facility and Cabletica Term Loan
B-2 Facility that were entered into in advance of the
Telefónica-Costa Rica Acquisition, and (ii) the portion of interest
paid in April 2021 that relates to pre-acquisition debt for the
AT&T Acquisition. The amount for the 2020 period represents
interest paid on pre-acquisition debt related to the AT&T
Acquisition, net of interest received on cash held in escrow in
advance of the closing of the AT&T Acquisition.
Rebase Information
Rebase growth rates are a non-GAAP measure. For purposes of
calculating rebased growth rates on a comparable basis for all
businesses that we owned during 2021, we have adjusted our
historical revenue and Adjusted OIBDA (i) to include the
pre-acquisition revenue and Adjusted OIBDA of the AT&T Acquired
Entities, which were acquired on October 31, 2020, in our rebased
amounts for the three and six months ended June 30, 2020, (ii) to
include the pre-acquisition revenue and Adjusted OIBDA of a small
B2B operation in the Cayman Islands that was acquired during 2020
in our rebased amounts for the three and six months ended June 30,
2020, (iii) to exclude the revenue and Adjusted OIBDA of certain
B2B operations in Puerto Rico that were disposed of in January 2021
in connection with the AT&T Acquisition from our rebased
amounts for the three and six months ended June 30, 2020, (iv) to
exclude the revenue and Adjusted OIBDA associated with our DTH
operations in Panama, which were shut down in January 2021 from our
rebased amounts for the three and six months ended June 30, 2020
and (v) to reflect the translation of our rebased amounts for the
three and six months ended June 30, 2020 at the applicable average
foreign currency exchange rates that were used to translate our
results for the three and six months ended June 30, 2021. We have
reflected the revenue and Adjusted OIBDA of acquired entities in
our 2020 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 entities during the
pre-acquisition periods, no assurance can be given that we have
identified all adjustments necessary to present their revenue and
Adjusted OIBDA 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. In addition, the
rebased growth percentages are not necessarily indicative of the
revenue and Adjusted OIBDA that would have occurred if these
transactions had occurred on the dates assumed for purposes of
calculating our rebased amounts or the revenue and Adjusted OIBDA
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 should be viewed as measures of operating
performance that are a supplement to, and not a substitute for,
U.S. GAAP reported growth rates.
The following tables provide the aforementioned adjustments made
to the revenue and Adjusted OIBDA amounts for the periods
indicated, to derive our rebased growth rates. Due to rounding,
certain rebased growth rate percentages may not recalculate.
The following tables set forth the reconciliations from reported
revenue to rebased revenue and related change calculations.
Three months ended June 30,
2020
C&W Caribbean &
Networks
C&W Panama
Liberty Puerto Rico
VTR
Cabletica
Intersegment
eliminations
Total
In millions
Revenue – Reported
$
404.9
$
112.2
$
109.1
$
193.1
$
34.6
$
(5.0
)
$
848.9
Rebase adjustments:
Acquisitions
1.6
—
219.5
—
—
—
221.1
Disposals
—
(0.5
)
(4.5
)
—
—
—
(5.0
)
Foreign currency
(4.7
)
—
—
28.6
(2.4
)
—
21.5
Revenue – Rebased
$
401.8
$
111.7
$
324.1
$
221.7
$
32.2
$
(5.0
)
$
1,086.5
Reported percentage change1
7
%
14
%
230
%
8
%
5
%
N/A
38
%
Rebased percentage change2
7
%
15
%
11
%
(6
)%
13
%
N/A
8
%
Six months ended June 30,
2020
C&W Caribbean &
Networks
C&W Panama
Liberty Puerto Rico
VTR
Cabletica
Intersegment
eliminations
Total
In millions
Revenue – Reported
$
856.9
$
250.5
$
213.7
$
399.5
$
68.3
$
(9.0
)
$
1,779.9
Rebase adjustments:
Acquisitions
3.3
—
436.1
—
—
—
439.4
Disposals
—
(1.4
)
(9.2
)
—
—
—
(10.6
)
Foreign currency
(11.7
)
—
—
51.1
(4.7
)
0.1
34.8
Revenue – Rebased
$
848.5
$
249.1
$
640.6
$
450.6
$
63.6
$
(8.9
)
$
2,243.5
Reported percentage change1
1
%
—
%
238
%
5
%
6
%
N/A
31
%
Rebased percentage change2
2
—
13
(7)
14
N/A
4
%
N/A – Not Applicable.
(1)
Reported percentage change is calculated
as current period revenue less prior period revenue divided by
prior period revenue.
(2)
Rebased percentage change is calculated as
current period revenue less rebased prior period revenue divided by
prior period rebased revenue.
The following tables set forth the reconciliations from reported
Adjusted OIBDA to rebased Adjusted OIBDA and related change
calculations.
Three months ended June 30,
2020
C&W Caribbean &
Networks
C&W Panama
Liberty Puerto Rico
VTR
Cabletica
Corporate
Total
In millions
Adjusted OIBDA – Reported
$
166.7
$
36.9
$
52.4
$
73.1
$
13.2
$
(9.7
)
$
332.6
Rebase adjustments:
Acquisitions1
0.5
—
83.1
—
—
—
83.6
Disposals
—
(0.1
)
(2.6
)
—
—
—
(2.7
)
Foreign currency
(1.8
)
—
—
10.8
(0.9
)
—
8.1
Adjusted OIBDA – Rebased
$
165.4
$
36.8
$
132.9
$
83.9
$
12.3
$
(9.7
)
$
421.6
Reported percentage change2
13
%
24
%
208
%
(6)
%
(4)
%
(29)
%
40
%
Rebased percentage change3
14
%
24
%
21
%
(18)
%
3
%
(29)
%
10
%
Six months ended June 30,
2020
C&W Caribbean &
Networks
C&W Panama
Liberty Puerto Rico
VTR
Cabletica
Corporate
Total
In millions
Adjusted OIBDA – Reported
$
353.7
$
82.7
$
102.9
$
153.2
$
26.5
$
(22.5
)
$
696.5
Rebase adjustments:
Acquisitions1
1.0
—
154.6
—
—
—
155.6
Disposals
—
(0.3
)
(5.5
)
—
—
—
(5.8
)
Foreign currency
(4.3
)
—
—
19.4
(1.8
)
—
13.3
Adjusted OIBDA – Rebased
$
350.4
$
82.4
$
252.0
$
172.6
$
24.7
$
(22.5
)
$
859.6
Reported percentage change2
4
%
8
%
203
%
(9)
%
1
%
(2)
%
31
%
Rebased percentage change3
5
%
9
%
34
%
(19)
%
9
%
(2)
%
6
%
(1)
The acquisition-related adjustment for Liberty Puerto Rico with
respect to the AT&T Acquired Entities includes $5 million and
$11 million, respectively, of estimated standalone costs that are
not covered by the transitional services agreement with AT&T.
These costs represent activities that AT&T had performed on
behalf of the AT&T Acquired Entities during the pre-acquisition
periods. Costs associated with these activities are being directly
incurred by us in post-acquisition periods and include insurance
coverage, certain commissions costs, group audit and control
activities and various other support activities, including for
legal, human resources, customer service, supply chain and finance.
(2)
Reported percentage change is calculated
as current period Adjusted OIBDA less prior period Adjusted OIBDA
divided by prior period Adjusted OIBDA.
(3)
Rebased percentage change is calculated as
current period Adjusted OIBDA less rebased prior period Adjusted
OIBDA divided by prior period rebased Adjusted OIBDA.
The following tables set forth the reconciliations from reported
revenue by product for our C&W Caribbean and Networks segment
to rebased revenue by product and related change calculations.
Three months ended June 30,
2020
Residential fixed
revenue
Residential mobile
revenue
Total residential
revenue
B2B revenue
Total revenue
In millions
Revenue by product – Reported
$
124.5
$
76.5
$
201.0
$
203.9
$
404.9
Rebase adjustments:
Acquisitions
—
—
—
1.6
1.6
Foreign currency
(1.6
)
(1.4
)
(3.0
)
(1.7
)
(4.7
)
Revenue by product – Rebased
$
122.9
$
75.1
$
198.0
$
203.8
$
401.8
Reported percentage change1
4
%
16
%
9
%
6
%
7
%
Rebased percentage change2
5
%
19
%
10
%
6
%
8
%
Six months ended June 30,
2020
Residential fixed
revenue
Residential mobile
revenue
Total residential
revenue
B2B revenue
Total revenue
In millions
Revenue by product – Reported
$
255.6
$
169.0
$
424.6
$
432.3
$
856.9
Rebase adjustments:
Acquisitions
—
—
—
3.3
3.3
Foreign currency
(4.1
)
(3.3
)
(7.4
)
(4.3
)
(11.7
)
Revenue by product – Rebased
$
251.5
$
165.7
$
417.2
$
431.3
$
848.5
Reported percentage change1
1
%
2%
1%
—%
1%
Rebased percentage change2
2
%
4%
3%
1%
2%
(1)
Reported percentage change is calculated
as current period revenue less prior period revenue divided by
prior period revenue.
(2)
Rebased percentage change is calculated as
current period revenue less rebased prior period revenue divided by
prior period rebased revenue
The following tables set forth the reconciliations from reported
revenue by product for our C&W Panama segment to rebased
revenue by product and related change calculations.
Three months ended June 30,
2020
Residential fixed
revenue
Residential mobile
revenue
Total residential
revenue
B2B revenue
Total revenue
In millions
Revenue by product – Reported
$
24.2
$
46.2
$
70.4
$
41.8
$
112.2
Rebase adjustment – Disposal
(0.5
)
—
(0.5
)
—
(0.5
)
Revenue by product – Rebased
$
23.7
$
46.2
$
69.9
$
41.8
$
111.7
Reported percentage change1
(2
)%
10
%
6
%
29
%
14
%
Rebased percentage change2
1
%
10
%
7
%
29
%
15
%
Six months ended June 30,
2020
Residential fixed
revenue
Residential mobile
revenue
Total residential
revenue
B2B revenue
Total revenue
In millions
Revenue by product – Reported
$
50.2
$
102.2
$
152.4
$
98.1
$
250.5
Rebase adjustment – Disposal
(1.4
)
—
(1.4
)
—
(1.4
)
Revenue by product – Rebased
$
48.8
$
102.2
$
151.0
$
98.1
$
249.1
Reported percentage change1
(6
)%
(2
)%
(3
)%
4
%
—
%
Rebased percentage change2
(3
)%
(2
)%
(2
)%
4
%
—
%
(1)
Reported percentage change is calculated
as current period revenue less prior period revenue divided by
prior period revenue.
(2)
Rebased percentage change is calculated as
current period revenue less rebased prior period revenue divided by
prior period rebased revenue.
The following table sets forth the reconciliation from reported
revenue to rebased revenue for our Liberty Puerto Rico segment.
Three months ended June 30,
2020
Legacy Liberty Puerto
Rico
Liberty Mobile
Liberty Puerto Rico
In millions
Revenue – Reported
$
109.1
$
—
$
109.1
Rebase adjustments:
Acquisitions
—
219.5
219.5
Disposal
(4.5
)
—
(4.5
)
Revenue – Rebased
$
104.6
$
219.5
$
324.1
Reported percentage change1
14
%
N/A
230
%
Rebased percentage change2
19
%
7
%
11
%
N/A – Not Applicable.
(1)
Reported percentage change is calculated
as current period revenue less prior period revenue divided by
prior period revenue.
(2)
Rebased percentage change is calculated as
current period revenue less rebased prior period revenue divided by
prior period rebased revenue.
The following table sets forth the reconciliation from reported
Adjusted OIBDA to rebased Adjusted OIBDA for our Liberty Puerto
Rico segment.
Three months ended June 30,
2020
Legacy Liberty Puerto
Rico
Liberty Mobile
Liberty Puerto Rico
In millions
Adjusted OIBDA – Reported
$
52.4
$
—
$
52.4
Rebase adjustments:
Acquisitions
—
83.1
83.1
Disposal
(2.6
)
—
(2.6
)
Adjusted OIBDA – Rebased
$
49.8
$
83.1
$
132.9
Reported percentage change1
21
%
N/A
208
%
Rebased percentage change2
27
%
18
%
21
%
N/A – Not Applicable.
(1)
Reported percentage change is calculated
as current period Adjusted OIBDA less prior period Adjusted OIBDA
divided by prior period Adjusted OIBDA.
(2)
Rebased percentage change is calculated as
current period Adjusted OIBDA less rebased prior period Adjusted
OIBDA divided by prior period rebased Adjusted OIBDA.
The following tables set forth the reconciliations from reported
revenue by product for our C&W borrowing group to rebased
revenue by product and related change calculations.
The following tables set forth the reconciliations from reported
revenue by product for our C&W borrowing group to rebased
revenue by product and related change calculations.
Three months ended June 30,
2020
Residential fixed
revenue
Residential mobile
revenue
Total residential
revenue
B2B revenue
Total revenue
In millions
Revenue by product – Reported
$
148.7
$
122.7
$
271.4
$
243.9
$
515.3
Rebase adjustments:
Acquisitions
—
—
—
1.6
1.6
Disposal
(0.5
)
—
(0.5
)
—
(0.5
)
Foreign currency
(2.0
)
(1.3
)
(3.3
)
(1.4
)
(4.7
)
Revenue by product – Rebased
$
146.2
$
121.4
$
267.6
$
244.1
$
511.7
Reported percentage change1
3
%
14
%
8
%
9
%
9
%
Rebased percentage change2
5
%
15
%
9
%
9
%
9
%
Six months ended June 30,
2020
Residential fixed
revenue
Residential mobile
revenue
Total residential
revenue
B2B revenue
Total revenue
In millions
Revenue by product – Reported
$
305.8
$
271.2
$
577.0
$
526.9
$
1,103.9
Rebase adjustments:
Acquisitions
—
—
—
3.3
3.3
Disposal
(1.4
)
—
(1.4
)
—
(1.4
)
Foreign currency
(4.3
)
(3.2
)
(7.5
)
(4.2
)
(11.7
)
Revenue by product – Rebased
$
300.1
$
268.0
$
568.1
$
526.0
$
1,094.1
Reported percentage change1
—
%
—
%
—
%
1
%
1
%
Rebased percentage change2
2
%
2
%
2
%
1
%
1
%
1.
Reported percentage change is
calculated as current period revenue less prior period revenue
divided by prior period revenue.
2.
Rebased percentage change is
calculated as current period revenue less rebased prior period
revenue divided by prior period rebased revenue
The following table sets forth the reconciliation from Adjusted
OIBDA for our C&W borrowing group to rebased Adjusted OIBDA and
related change calculations.
Three months ended June 30,
2020
Six months ended June 30,
2020
In millions
Adjusted OIBDA – Reported
$
203.6
$
436.4
Rebase adjustments:
Acquisition
0.5
1.0
Disposal
(0.1
)
(0.3
)
Foreign currency
(1.8
)
(4.3
)
Adjusted OIBDA – Rebased
$
202.2
$
432.8
Reported percentage change1
15
%
5
%
Rebased percentage change2
16
%
6
%
1.
Reported percentage change is
calculated as current period Adjusted OIBDA less prior period
Adjusted OIBDA divided by prior period Adjusted OIBDA.
2.
Rebased percentage change is
calculated as current period Adjusted OIBDA less rebased prior
period Adjusted OIBDA divided by prior period rebased Adjusted
OIBDA.
Non-GAAP Reconciliation for Consolidated Leverage Ratios
We have set forth below our consolidated leverage and net
leverage ratios. Our consolidated leverage and net leverage ratios,
each a non-GAAP measure, are defined as (i) adjusted total debt and
finance lease obligations (total carrying value of debt and finance
lease obligations plus discounts, premiums and deferred finance
costs, less projected derivative principal-related cash receipts)
less cash and cash equivalents divided by (ii) last two quarters
annualized Adjusted OIBDA as of June 30, 2021. For purposes of
these calculations, adjusted total debt and finance lease
obligations is measured using swapped foreign currency rates. We
believe our consolidated leverage and net leverage ratios are
useful because they allow our investors to consider the aggregate
leverage on the business inclusive of any leverage at the Liberty
Latin America level, not just at each of our operations. Investors
should view consolidated leverage and net leverage as supplements
to, and not substitutes for, ratios that would be calculated based
upon measures presented in accordance with U.S. GAAP.
Reconciliations of the numerator and denominator used to calculate
the consolidated leverage and net leverage ratios as of June 30,
2021 and March 31, 2021 are set forth below:
June 30, 2021
March 31, 2021
in millions, except leverage
ratios
Total debt and finance lease
obligations
$
8,794.3
$
8,782.9
Discounts, premiums and deferred financing
costs, net
152.3
156.0
Projected derivative principal-related
cash payments1
114.1
150.9
Adjusted total debt and finance lease
obligations
9,060.7
9,089.8
Less:
Cash and cash equivalents
1,311.1
1,305.6
Net debt and finance lease
obligations
$
7,749.6
$
7,784.2
Adjusted OIBDA2:
Adjusted OIBDA for the three months ended
December 31, 2020
N/A
428.0
Adjusted OIBDA for the three months ended
March 31, 2021
449.3
449.3
Adjusted OIBDA for the three months ended
June 30, 2021
464.0
N/A
Rebased Adjusted OIBDA – AT&T Acquired
Entities3
—
26.8
Adjusted OIBDA – last two quarters
$
913.3
$
904.1
Annualized adjusted OIBDA – last two
quarters annualized
$
1,826.6
$
1,808.2
Consolidated leverage ratio
5.0x
5.0x
Consolidated net leverage ratio
4.2x
4.3x
N/A – Not Applicable.
1.
Amounts represent the U.S. dollar
equivalents and are based on interest rates and exchange rates that
were in effect as of June 30, 2021 and March 31, 2021,
respectively. For a discussion of our projected cash flows
associated with derivative instruments, please see Item 3.
Quantitative and Qualitative Disclosures About Market
Risk—Projected Cash Flows Associated with Derivative Instruments in
our most recently filed Quarterly Report on Form 10-Q.
2.
Adjusted OIBDA is a non-GAAP
measure. See Adjusted OIBDA and Adjusted OIBDA less P&E
Additions above for reconciliation of Adjusted OIBDA to the nearest
U.S. GAAP measure for the three months ended June 30, 2021. A
reconciliation of our operating income to Adjusted OIBDA for the
three months ended December 30, 2020 and March 31, 2021 is
presented in the following table:
Three months ended December
31, 2020
Three months ended March 31,
2021
in millions
Operating income
$
103.3
$
178.2
Share-based compensation expense
22.2
23.0
Depreciation and amortization
253.1
245.9
Impairment, restructuring and other
operating items, net
49.4
2.2
Adjusted OIBDA
$
428.0
$
449.3
3.
Reflects our calculation of
Adjusted OIBDA, as defined by Liberty Latin America, based upon
historical financial information of the AT&T Acquired Entities
for the pre-acquisition period (October 1, 2020 to October 31, 2020
with respect to the March 31, 2021 ratio calculations) as adjusted
primarily for (i) the impact of new rates pursuant to agreements
with AT&T related to roaming, subsea and ethernet services,
(ii) aligning the accounting policies of the AT&T Acquired
Entities to those used by Liberty Latin America, (iii) the impact
of the elimination of parent-company allocations included in the
historical financial statements of the AT&T Acquired Entities
that are replaced by costs for services provided through the
transitional services agreement with AT&T, which generally
relate to network operations, customer service, finance and
accounting, information, technology, and sales and marketing, and
(iv) estimated standalone costs not covered by the transitional
services agreement with AT&T.
Non-GAAP Reconciliations for Borrowing Groups
We provide certain financial measures in this press release of
our borrowing groups. The financial statements of each of our
borrowing groups are prepared in accordance with U.S. GAAP. We
include certain financial measures for our borrowing group in this
press release that are considered non-GAAP measures, including: (i)
Adjusted OIBDA; (ii) Adjusted OIBDA Margin; and (iii) Proportionate
Adjusted OIBDA.
Adjusted OIBDA by Borrowing Group
Adjusted OIBDA and proportionate Adjusted OIBDA at a borrowing
group level are non-GAAP measures. Adjusted OIBDA is defined as
operating income or loss before share-based compensation,
depreciation and amortization, related-party fees and allocations,
provisions and provision releases related to significant litigation
and impairment, restructuring and other operating items.
Proportionate Adjusted OIBDA is defined as Adjusted OIBDA less the
noncontrolling interests' share of Adjusted OIBDA. We believe these
measures at the borrowing group level are useful to investors
because they are one of the bases for comparing our performance
with the performance of other companies in the same or similar
industries, although our measures may not be directly comparable to
similar measures used by other public companies. These measures
should be viewed as measures of operating performance that are a
supplement to, and not a substitute for, operating income or loss,
net earnings or loss and other U.S. GAAP measures of income.
A reconciliation of C&W's operating income (loss) to total
Adjusted OIBDA and Proportionate Adjusted OIBDA is presented in the
following table:
Three months ended
Six months ended
June 30,
June 30,
2021
2020
2021
2020
in millions
Operating income (loss)
$
67.1
$
(245.7
)
$
135.1
$
(188.1
)
Share-based compensation expense
9.8
7.9
16.7
15.3
Depreciation and amortization
139.6
155.9
285.5
303.5
Related-party fees and allocations
7.5
6.8
12.8
17.8
Impairment, restructuring and other
operating items, net
9.7
278.7
8.9
287.9
Total Adjusted OIBDA
233.7
203.6
459.0
436.4
Noncontrolling interests' share of
Adjusted OIBDA
33.9
26.1
67.0
58.2
Proportionate Adjusted OIBDA
$
199.8
$
177.5
$
392.0
$
378.2
A reconciliation of VTR's operating income to total Adjusted
OIBDA is presented in the following table:
Three months ended
Six months ended
June 30,
June 30,
2021
2020
2021
2020
CLP in billions
Operating income
5.3
25.0
18.7
52.9
Share-based compensation expense
1.5
1.6
2.8
3.2
Related-party fees and allocations
1.0
1.9
2.6
5.7
Depreciation
39.3
30.2
70.3
59.5
Impairment, restructuring and other
operating items, net
2.3
1.5
5.9
3.0
Total Adjusted OIBDA
49.4
60.2
100.3
124.3
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210804006138/en/
Investor Relations Kunal Patel, ir@lla.com
Corporate Communications Claudia Restrepo,
llacommunications@lla.com
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