[August 05, 2014] |
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Liberty Global Reports First Half 2014 Results
DENVER --(Business Wire)--
Liberty Global plc ("Liberty Global" or the "Company") (NASDAQ: LBTYA,
LBTYB and LBTYK), today announces financial and operating results for
the three months ("Q2") and six months ("YTD") ended June 30, 2014. Some
of the information below concerning Virgin Media Inc. ("Virgin Media")
relates to periods prior to our ownership of the business. Please also
note that we sold substantially all of our content business on January
31, 2014 (the "Chellomedia Sale") and, accordingly, we have presented
the disposed business as a discontinued operation for all periods
presented. Highlights for the 2014 periods as compared to the same
periods in 2013 (unless noted) include:
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Organic RGU2 additions of 584,000 YTD, including 239,000 in
Q2
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Q2 driven by strong broadband gains and our lowest Q2 video
attrition since 2006
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Rebased3 revenue growth of 3% YTD and in Q2, reaching $9.1
billion YTD
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Reflects improved Q2 performance in Western Europe
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YTD and Q2 rebased Operating Cash Flow4 growth of 7% and
6%, respectively
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Fueled by strong results in Germany, U.K., Belgium and Latin
America
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Operating income increased 29% to $1.3 billion YTD
-
Adjusted FCF increased 40%1 on a combined basis to $1.1
billion YTD
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Record Q2 Adjusted FCF of $725 million
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Share repurchases of ~$900 million YTD, including nearly $500 million
in Q2
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Completion of Ziggo transaction on track for second half of 2014
Mike Fries, Chief Executive Officer, stated, "Our business is thriving
on all fronts - operationally, strategically and financially. We added
nearly 240,000 new RGUs in the second quarter, a 25% improvement over
last year, fueled again by our superior broadband speeds and advanced TV
services like Horizon and TiVo. This volume growth, along with price
increases and improving momentum in B2B and mobile, drove rebased
revenue growth above 3% in the second quarter. In addition, we are
heavily focused on using our operating leverage and scale to drive
efficiencies across our footprint and these initiatives helped us
achieve 7% rebased OCF growth year-to-date and 40% Adjusted Free Cash
Flow growth1. Not surprisingly, we remain confident that
we'll achieve or exceed all our public guidance targets for the full
year."
"Strategically, we're making steady progress on the Ziggo transaction,
which we remain confident will close in the second half of 2014. We are
also executing on our content strategy, with plans to invest in
All3Media, a U.K.-based global production company, and De Vijver Media,
a leading commercial broadcaster in Belgium, and with the recently
completed acquisition of an interest in ITV, the largest commercial
broadcaster in the U.K. These financially attractive investments require
limited equity capital and will allow us to participate or partner with
great content businesses that should bolster our core cable operations
over the long-term. And lastly, we continue our focus on returning
capital through share buybacks, with approximately $900 million in
repurchases during the first half of 2014, and we're targeting an
additional $2.6 billion by year-end 2015."
Subscriber Statistics
At June 30, 2014, we provided our 24.5 million unique customers with
48.9 million subscription services ("RGUs") across our footprint of 47.4
million homes passed. These services consisted of 21.7 million video,
14.8 million broadband internet and 12.4 million telephony
subscriptions. During Q2 2014, we increased our total RGUs by 268,000,
driven primarily by our 239,000 organic additions and a small
acquisition in Poland. At the end of Q2 2014, 14.2 million or 58% of our
customers were bundled and we reached 2.0 products per customer for the
first time. With over 10 million single-play customers, four million
dual-play customers and innovative products powered by our superior
network, we see an excellent opportunity for substantial RGU growth
ahead.
Our organic additions of 239,000 RGUs during Q2 2014 represent our
second best Q2 result ever, and an increase of 48,000, as compared to
our 191,000 RGU additions in Q2 2013. This 25% year-over-year increase
was driven by improved broadband RGU additions and reduced video
attrition, partially offset by lower year-over-year telephony RGU
additions.
In terms of video, our video loss of 72,000 RGUs was our lowest Q2 video
attrition since 2006. During Q2 2014, Western Europe had a particularly
strong performance as Germany reported its best video result ever, while
our Dutch operation achieved its lowest quarterly video attrition of the
last four years. This strong performance was partly driven by the
investment in our next-generation TV platforms. We added 240,000
next-generation video subscribers in Q2 2014 driving our total
next-generation video base to 2.9 million subscribers. This base
includes 2.3 million TiVo subscribers in the U.K. and over 645,000
Horizon TV subscribers across four countries, reflecting 22% penetration
of our total digital cable base, or 36% of our total digital cable base
in the five markets where we offer our advanced video services. On the
product innovation front, we successfully launched our TV everywhere
app, Horizon Go, in our four Horizon markets and in Poland in July. With
this launch, we have significantly enhanced the multi-screen viewing
experience for our customers, partly driven by the expansion of the
number of live TV channels that can be watched in, as well as out of the
home. We ended the second quarter of 2014 with 13.4 million digital
cable subscribers, representing 64% digital penetration5 and
7.5 million analog cable subscribers.
Our broadband additions of 185,000 RGUs represented the second best Q2
result ever, led by strong improvements in the U.K., the Netherlands and
Poland. This result was further supported by a wide range of countries
including 82,000 additions in Germany, 22,000 additions in Chile and
five other countries adding at least 11,000 RGUs each. On the telephony
front, we added 125,000 RGUs during Q2, as compared to 142,000 RGUs
during the prior year period. This decrease was mainly attributable to
slower triple-play take up in Germany and Poland that was only partially
offset by improvements in telephony additions in the Belgium and the U.K.
Geographically, our Q2 RGU additions consisted of 165,000 RGUs in
Western Europe, 50,000 RGUs in Latin America6 and 24,000 RGUs
in Central and Eastern Europe ("CEE"). In Western Europe, our German
operation remained our primary growth engine and delivered 124,000 RGU
additions in Q2 led by consistent broadband additions and a flat video
base. Two other notable performers were the U.K. and the Netherlands. In
particular, as a result of our ongoing investment in products and
services in these two markets, our British operation halved its RGU
losses to 17,000 as compared to the prior year period and the
Netherlands continued a positive RGU trend by adding 7,000 RGUs in Q2.
Also of note, our Chilean business reported 41,000 RGU additions, which
was driven by its highest quarterly broadband additions (22,000) of the
last two years. In CEE, we delivered a 15,000 organic RGU addition
increase as compared to Q2 2013, as our Hungarian operation boosted
results on the back of attractive triple-play offers in combination with
reduced churn levels.
In terms of mobile, we ended the second quarter of 2014 with 4.3 million
mobile subscribers7. The 111,000 increase in Q2 was our best
result over the past year and was led by over 100,000 net mobile
additions in our European operations including over 40,000 additions in
both the U.K. and Belgium.
Revenue
We reported consolidated revenue of $4.6 billion and $9.1 billion for
the three and six months ended June 30, 2014, respectively. As compared
to the corresponding 2013 periods, these results reflect increases of
51% and 59%, respectively. Our growth in both periods was driven by the
inclusion of acquisitions (primarily Virgin Media, which we acquired on
June 7, 2013), and, to a lesser extent, positive foreign currency
movements ("FX"), as all of our key European currencies strengthened
against the U.S. dollar, and organic growth. When adjusting for the
impact of acquisitions and FX, we achieved year-over-year rebased
revenue growth of 3% for both the three and six months ended June 30,
2014, respectively. Our quarterly rebased top-line growth improved from
2% during Q1 2014 to 3% during Q2 2014, each as compared to the
corresponding prior year period. Such improvement is due in part to our
continued broadband internet success, and supported by selective price
increases and growth in both our mobile and business-to-business ("B2B")
segments.
From a geographic perspective for Q2, we generated 4% rebased revenue
growth in Chile and 3% in Western Europe, while our CEE operations
remained flat on a rebased basis, in-line with recent quarterly results.
Our performance in Western Europe was led by our business in
Switzerland, which delivered 6% rebased revenue growth in Q2, its best
quarterly result in six years, driven by a mix of volume and ARPU8
growth and a positive contribution from B2B. Our British operation also
improved sequentially and posted 3% rebased growth for Q2 2014, as
compared to 1% growth in Q1 2014. Our cable subscription business in the
U.K. reported 3% year-over-year rebased growth, despite a $12 million
negative impact as a result of a May 1, 2014 legislative change to the
VAT rules. In addition, our mobile and B2B businesses in the U.K.
delivered improved Q2 results with 12% and 6% rebased revenue growth,
respectively, but were partly offset by a decrease in revenue from
Virgin Media's off-net business and lower interconnect rates.
Rounding out our five largest markets, in Q2 our German and Belgian
businesses recorded rebased revenue growth of 5% and 4%, respectively,
while our Dutch operation experienced a rebased revenue decline of 1%,
which represents the third consecutive quarter that we have improved our
rebased revenue performance in the Netherlands on a year-over-year basis.
Operating Cash Flow
For the three and six months ended June 30, 2014, our reported OCF
increased 49% to $2.1 billion and 58% to $4.3 billion, respectively, as
compared to the corresponding prior year periods. Similar to our
reported revenue results, our reported OCF increased as a result of
acquisitions (primarily Virgin Media), organic growth and favorable FX
movements. Adjusting for both acquisitions and currencies, we delivered
rebased OCF growth of 6% and 7% for the three and six months ended June
30, 2014, respectively. Our strong rebased OCF performance during the
YTD period included the favorable net impact of nonrecurring items
during Q1 2014, the most significant of which include the impact of
accrual releases related to the settlement of operational contingencies
of $17 million in Belgium and $7 million in Poland and an $11 million
favorable revenue settlement in Germany.
From a regional perspective, our European business produced 6% rebased
OCF growth in Q2 2014, with our Western European operations delivering
7% rebased growth. Our Q2 2014 growth in Western Europe was somewhat
offset by a 2% rebased OCF decline in CEE and higher year-over-year
central and other costs. Beyond Europe, our Chilean operation delivered
13% rebased OCF growth in the quarter, primarily driven by a reduction
of the OCF deficit generated by its mobile business.
Turning back to Western Europe, our strong Q2 performance was
underpinned by our German, Swiss and British operations, which delivered
11%, 9% and 6% rebased OCF growth, respectively. In Switzerland, our
rebased OCF growth was our best Q2 performance since 2008, and was
powered by its aforementioned revenue growth and a favorable quarterly
comparison due to higher Horizon TV expenses in the prior year period.
With respect to Virgin Media, our Q2 rebased OCF growth of 6% was
delivered primarily through a combination of top-line growth, cost
savings and synergies, as a nonrecurring item that reduced programming
costs in Q2 largely offset the adverse impact of the aforementioned
legislative change to the VAT rules. Also noteworthy was our Dutch
performance, which reflects our best quarterly result in this market in
over a year with 3% rebased OCF growth. This result was helped by strong
cost control and further operational efficiencies. These results were
partly offset by slower growth in our Belgian business, which delivered
2% rebased OCF growth in the quarter, due in part to higher costs
associated with handset subsidies.
We reported consolidated OCF margins9 of 47% for the three
and six months ended June 30, 2014, respectively, in line with the
corresponding prior year periods on a reported basis. If we were to
adjust our margin calculations10 to include Virgin Media for
the full three- and six-month periods ended June 30, 2013, our combined
OCF margins would have been 45% for each of the 2013 periods. The
resulting year-over-year margin improvements for the three and six month
periods were primarily driven by our two largest operations, Virgin
Media and UnityMedia KabelBW.
Operating Income
We reported operating income of $670 million and $1.3 billion for the
three and six months ended June 30, 2014, respectively. As compared to
the corresponding prior year periods, our operating income increased 50%
for the three-month period and 29% for the six-month period. These
increases are primarily attributable to the net impacts of the Virgin
Media acquisition, which accounted for a large part of the growth in our
OCF and depreciation and amortization expenses. In addition, decreases
in share-based compensation expense also contributed to the increases in
operating income.
Net Loss Attributable to Shareholders
For the three and six months ended June 30, 2014, we reported net losses
attributable to shareholders ("Net Losses") of $250 million or $0.32 per
basic and diluted11 share and $329 million or $0.42 per basic
and diluted share. This compares to Net Losses of $12 million or $0.02
per basic and diluted share and $13 million or $0.02 per
basic and diluted share for the three and six months ended June 30,
2013, respectively. The Net Loss for both the three and six months ended
June 30, 2014, as compared to the prior year periods, was driven to a
large extent by increases in realized and unrealized losses on
derivative instruments, which more than offset a $333 million gain on
the January 2014 Chellomedia Sale.
At July 30, 2014, we had 779 million shares outstanding, including 215
million Class A ordinary shares, 10 million Class B ordinary shares and
554 million Class C ordinary shares.
Property and Equipment Additions
For the three months ended June 30, 2014, we reported property and
equipment ("P&E") additions12 of $971 million
or 21% of revenue, as compared to $735 million or 24% of revenue for the
corresponding prior year period. For the YTD periods, we incurred P&E
additions of $1.9 billion or 21% of revenue during 2014 as compared to
$1.3 billion or 22% of revenue for the corresponding prior year period.
In absolute terms, both year-over-year increases were primarily related
to the inclusion of Virgin Media, which accounted for $356 million and
$700 million of our P&E additions during the three- and six-month
periods of 2014, as compared to $93 million in each of the prior year
periods.
Adjusting our Q2 and YTD 2013 results for the inclusion of Virgin Media
for the full period, our combined P&E additions would have been $1.0
billion or 23% of combined revenue for Q2 2013 and $1.9 billion or 22%
for the YTD 2013 period.
In terms of a breakdown of our YTD 2014 spend, approximately 55% was
related to customer premises equipment and scalable infrastructure, 25%
was attributable to line extensions and upgrade/rebuild activity and 20%
was due to support capital including information technology upgrades and
general support systems.
Free Cash Flow & Adjusted Free Cash Flow
For the three and six months ended June 30, 2014, we generated FCF of
$711 million and $1.0 billion, respectively, as compared to FCF of $203
million and $225 million in the corresponding prior year periods.
Similarly, on an adjusted basis, which excludes certain cash costs, we
increased FCF to $725 million for Q2 2014, as compared to $269 million
for the second quarter of 2013. For the first half of 2014, we generated
$1.1 billion of Adjusted FCF as compared to $336 million for the 2013
six-month period. The growth in both FCF and Adjusted FCF over the prior
year three- and six-month periods was aided primarily by the inclusion
of Virgin Media.
Finally, if we were to combine the Adjusted FCF of both Liberty Global
and Virgin Media for the prior year periods, our Adjusted FCF of $1.1
billion for YTD 2014 represents a 40% increase over the combined
Adjusted FCF of $769 million for YTD 2013. For the second quarter of
2014, we realized a year-over-year Adjusted FCF improvement of 36% to
$725 million, as compared to $532 million of combined Adjusted FCF in Q2
2013. These increases were driven by organic OCF growth and favorable
net working capital and FX movements that were only partially offset by
higher cash interest payments. With respect to the remainder of 2014, we
expect our Adjusted FCF to be significantly weighted toward the fourth
quarter as compared to the third quarter.
Leverage & Liquidity
We had total debt13 of $42.6 billion at June 30, 2014, as
compared to $44.5 billion at March 31, 2014. Our decrease in total debt
during the quarter was primarily due to over $2.0 billion of net debt
repayments, most of which occurred at Virgin Media. These repayments
more than offset the translation effect associated with a weakening U.S.
dollar relative to the British pound sterling.
Subsequent to quarter-end, we took advantage of favorable market
conditions to complete a $715 million leverage neutral refinancing in
Puerto Rico, which extended our average maturity and reduced our cost of
debt. Furthermore, we acquired a 6.4% stake in ITV plc for a total
consideration of £481 million ($822 million) on July 17, 2014. Most of
the purchase price was financed through a loan linked to a hedging
transaction, while the remainder of this opportunistic investment was
funded with existing liquidity.
With respect to our leverage at June 30, 2014, we had consolidated gross
and net leverage ratios14 of 4.9x and 4.8x, respectively,
after excluding $1.6 billion of debt backed by shares we hold in
Sumitomo and Ziggo. Our fully-swapped borrowing cost15
decreased from 6.8% at March 31, 2014 to 6.6% at June 30, 2014,
primarily reflecting the recent refinancing transactions at both Virgin
Media and Telenet in combination with the repayment of higher cost debt
at UPC Holding. In addition, the average duration of our debt improved
to over seven years at June 30, 2014, with less than 20% of our total
debt due before 2020.
In terms of our liquidity position, we finished the second quarter of
2014 with $1.1 billion of cash and cash equivalents, as compared to $3.1
billion at Q1 2014. During the second quarter of 2014, our cash position
decreased as a result of the aforementioned debt repayments and stock
repurchases, partially offset by strong free cash flow generation. Our
consolidated liquidity16 at June 30, 2014 was approximately
$4.7 billion, including the aforementioned cash and cash equivalents of
$1.1 billion and aggregate maximum undrawn commitments under our credit
facilities17 of $3.6 billion.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including our expectations with respect to our operating momentum and
2014 and future prospects, including our expectations for continued
organic growth in subscribers, higher rebased OCF growth, growth in and
phasing of Adjusted FCF, the penetration of our advanced services,
increased broadband internet speeds and acceptance of our product
bundles including our mobile offers; our insight and expectations
regarding competitive and economic factors in our markets, including the
Netherlands, statements regarding the acquisition of Ziggo 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 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 and economic factors, the
continued growth in services for digital television at a reasonable
cost, the effects of changes in technology, law and regulation, our
ability to satisfy regulatory conditions associated with acquisitions
and dispositions, our ability to achieve expected operational
efficiencies and economies of scale, our ability to generate expected
revenue and operating cash flow, control property and equipment
additions as measured by percentage of revenue, achieve assumed margins
and control the phasing of our FCF, our ability to access cash of our
subsidiaries and the impact of our future financial performance and
market conditions generally, on the availability, terms and deployment
of capital, fluctuations in currency exchange and interest rates, the
continued creditworthiness of our counterparties, the ability of vendors
and suppliers to timely deliver quality products, as well as other
factors detailed from time to time in our filings with the Securities
and Exchange Commission including the most recently filed Forms 10-K/A
and 10-Q. These forward-looking statements speak only as of the date of
this release. We expressly disclaim any obligation or undertaking to
disseminate any updates or revisions to any forward-looking statement
contained herein to reflect any change in our expectations with regard
thereto or any change in events, conditions or circumstances on which
any such statement is based.
About Liberty Global
Liberty Global is the largest international cable company with
operations in 14 countries. We connect people to the digital world and
enable them to discover and experience its endless possibilities. Our
market-leading triple-play services are provided through next-generation
networks and innovative technology platforms that connected 24 million
customers subscribing to 49 million television, broadband internet and
telephony services at June 30, 2014.
Liberty Global's consumer brands include Virgin Media, UPC, Unitymedia,
Kabel BW, Telenet and VTR. Our operations also include Liberty Global
Business Services, our commercial division, and Liberty Global Ventures,
our investment fund. For more information, please visit www.libertyglobal.com
or contact:
_______________________________________
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1
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Please see page 17 for information on Free Cash Flow ("FCF") and
Adjusted Free Cash Flow ("Adjusted FCF") and the required
reconciliations. The combined Adjusted FCF growth rates of 36% and
40% for the Q2 and YTD periods, respectively, are calculated by
comparing our reported Adjusted FCF during the Q2 and YTD 2014
periods to the combined Adjusted FCF of our company and Virgin
Media during the Q2 and YTD 2013 periods, as calculated on pages
17 and 18.
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2
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Please see page 24 for the definition of RGUs. Organic figures
exclude RGUs of acquired entities at the date of acquisition, but
include the impact of changes in RGUs from the date of acquisition.
All subscriber/RGU additions or losses refer to net organic changes,
unless otherwise noted.
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3
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Please see page 12 for information on rebased growth.
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4
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Please see page 15 for our OCF definition and the required
reconciliation.
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5
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Digital penetration is calculated by dividing the number of digital
cable RGUs by the total number of digital and analog cable RGUs.
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6
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Latin America includes our broadband communications operations in
both Chile and Puerto Rico.
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7
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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 90 days, based on industry standards within the respective
country. Our June 30, 2014 mobile subscriber counts for the U.K. and
Chile include 1,021,000 and 24,500 prepaid mobile subscribers,
respectively.
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8
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Average Revenue Per Unit ("ARPU") refers to the average monthly
subscription revenue per average customer relationship and is
calculated by dividing the average monthly subscription revenue
(excluding installation, late fees, interconnect and mobile services
revenue) for the indicated period, by the average of the opening and
closing balances for customer relationships for the period. Customer
relationships of entities acquired during the period are normalized.
Unless otherwise indicated, ARPU per customer relationship for the
Liberty Global Consolidated, the European Operations Division and
Other Europe are not adjusted for currency impacts.
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9
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OCF margin is calculated by dividing OCF by total revenue for the
applicable period.
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10
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Please see page 19 for information on combined OCF and combined OCF
margins.
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11
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All share and per share amounts presented herein have been
retroactively adjusted to give effect to the March 3, 2014 share
split in the form of a share dividend ("2014 Share Dividend"), which
constitutes a bonus issue under our articles of association and
English law, of one Liberty Global Class C ordinary share for each
outstanding Class A, Class B and Class C ordinary share.
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12
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Our property and equipment additions include our capital
expenditures on an accrual basis and amounts financed under vendor
financing or capital lease arrangements.
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13
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Total debt includes capital lease obligations.
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14
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Our gross and net debt ratios are defined as total debt and net debt
to annualized OCF of the latest quarter. Net debt is defined as
total debt less cash and cash equivalents. For purposes of these
calculations, debt excludes the loans backed by the shares we hold
in Sumitomo Corp. and Ziggo and is measured using swapped foreign
currency rates, consistent with the covenant calculation
requirements of our subsidiary debt agreements.
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15
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Our fully-swapped debt borrowing cost represents the weighted
average interest rate on our aggregate variable- and fixed-rate
indebtedness (excluding capital lease obligations), including the
effects of derivative instruments, original issue premiums or
discounts and commitment fees, but excluding the impact of financing
costs.
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16
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Consolidated liquidity refers to our consolidated cash and cash
equivalents plus the maximum undrawn commitments under our
subsidiaries' borrowing facilities without regard to covenant
compliance calculations.
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17
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The $3.6 billion reflects the aggregate unused borrowing capacity,
as represented by the maximum undrawn commitments under our
subsidiaries' applicable facilities without regard to covenant
compliance calculations. Upon completion of the relevant June 30,
2014 compliance reporting requirements for our credit facilities,
and assuming no further changes from quarter-end borrowing levels,
we anticipate that our subsidiaries' borrowing availability will be
$3.6 billion.
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Liberty Global plc
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Condensed Consolidated Balance Sheets (unaudited)
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June 30,
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December 31,
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2014
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2013
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in millions
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ASSETS
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Current assets:
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Cash and cash equivalents
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$
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1,110.2
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$
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2,701.9
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Trade receivables, net
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1,511.9
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1,588.7
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Derivative instruments
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499.2
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252.1
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Deferred income taxes
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319.8
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226.1
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Prepaid expenses
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252.1
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238.2
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Current assets of discontinued operation
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-
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238.7
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Other current assets
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263.8
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236.9
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Total current assets
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3,957.0
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5,482.6
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Investments
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3,593.1
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3,491.2
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Property and equipment, net
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23,820.6
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23,974.9
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Goodwill
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23,950.5
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23,748.8
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Intangible assets subject to amortization, net
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5,382.2
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5,795.4
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Long-term assets of discontinued operation
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-
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513.6
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Other assets, net
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4,826.0
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4,707.8
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Total assets
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$
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65,529.4
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$
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67,714.3
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LIABILITIES AND EQUITY
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Current liabilities:
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|
|
|
|
Accounts payable
|
|
|
|
$
|
1,207.5
|
|
|
|
$
|
1,072.9
|
|
Deferred revenue and advance payments from subscribers and others
|
|
|
|
1,443.7
|
|
|
|
1,406.2
|
|
Current portion of debt and capital lease obligations
|
|
|
|
1,850.9
|
|
|
|
1,023.4
|
|
Derivative instruments
|
|
|
|
1,271.4
|
|
|
|
751.2
|
|
Accrued interest
|
|
|
|
666.6
|
|
|
|
598.7
|
|
Accrued programming and copyright fees
|
|
|
|
387.6
|
|
|
|
359.1
|
|
Current liabilities of discontinued operation
|
|
|
|
-
|
|
|
|
127.5
|
|
Other accrued and current liabilities
|
|
|
|
2,431.9
|
|
|
|
2,344.0
|
|
Total current liabilities
|
|
|
|
9,259.6
|
|
|
|
7,683.0
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt and capital lease obligations
|
|
|
|
40,709.3
|
|
|
|
43,680.9
|
|
Long-term liabilities of discontinued operation
|
|
|
|
-
|
|
|
|
19.8
|
|
Other long-term liabilities
|
|
|
|
4,772.9
|
|
|
|
4,789.1
|
|
Total liabilities
|
|
|
|
54,741.8
|
|
|
|
56,172.8
|
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
|
|
Total Liberty Global shareholders
|
|
|
|
11,440.2
|
|
|
|
12,025.8
|
|
Noncontrolling interests
|
|
|
|
(652.6
|
)
|
|
|
(484.3
|
)
|
Total equity
|
|
|
|
10,787.6
|
|
|
|
11,541.5
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity
|
|
|
|
$
|
65,529.4
|
|
|
|
$
|
67,714.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liberty Global plc
|
Condensed Consolidated Statements of Operations (unaudited)
|
|
|
|
|
|
Three months ended
|
|
|
Six months ended
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
in millions, except per share amounts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
$
|
4,602.2
|
|
|
|
$
|
3,057.8
|
|
|
|
$
|
9,135.9
|
|
|
|
$
|
5,729.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (other than depreciation and amortization) (including
share-based compensation)
|
|
|
|
1,719.2
|
|
|
|
1,098.1
|
|
|
|
3,418.0
|
|
|
|
2,064.9
|
|
Selling, general and administrative (SG&A) (including share-based
compensation)
|
|
|
|
792.5
|
|
|
|
613.0
|
|
|
|
1,555.0
|
|
|
|
1,084.4
|
|
Depreciation and amortization
|
|
|
|
1,393.4
|
|
|
|
855.8
|
|
|
|
2,770.5
|
|
|
|
1,540.4
|
|
Impairment, restructuring and other operating items, net
|
|
|
|
27.6
|
|
|
|
45.8
|
|
|
|
141.2
|
|
|
|
66.7
|
|
|
|
|
|
3,932.7
|
|
|
|
2,612.7
|
|
|
|
7,884.7
|
|
|
|
4,756.4
|
|
Operating income
|
|
|
|
669.5
|
|
|
|
445.1
|
|
|
|
1,251.2
|
|
|
|
973.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-operating income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense
|
|
|
|
(641.8
|
)
|
|
|
(542.4
|
)
|
|
|
(1,295.3
|
)
|
|
|
(1,013.9
|
)
|
Interest and dividend income
|
|
|
|
2.2
|
|
|
|
35.0
|
|
|
|
16.0
|
|
|
|
48.7
|
|
Realized and unrealized gains (losses) on derivative instruments, net
|
|
|
|
(328.6
|
)
|
|
|
(3.4
|
)
|
|
|
(705.2
|
)
|
|
|
192.1
|
|
Foreign currency transaction gains (losses), net
|
|
|
|
(36.4
|
)
|
|
|
91.3
|
|
|
|
(57.2
|
)
|
|
|
(45.0
|
)
|
Realized and unrealized gains due to changes in fair values of
certain investments, net
|
|
|
|
157.4
|
|
|
|
193.8
|
|
|
|
97.2
|
|
|
|
264.6
|
|
Losses on debt modification and extinguishment, net
|
|
|
|
(53.0
|
)
|
|
|
(11.7
|
)
|
|
|
(73.9
|
)
|
|
|
(170.0
|
)
|
Other expense, net
|
|
|
|
(3.9
|
)
|
|
|
(1.5
|
)
|
|
|
(4.4
|
)
|
|
|
(3.2
|
)
|
|
|
|
|
(904.1
|
)
|
|
|
(238.9
|
)
|
|
|
(2,022.8
|
)
|
|
|
(726.7
|
)
|
Earnings (loss) from continuing operations before income taxes
|
|
|
|
(234.6
|
)
|
|
|
206.2
|
|
|
|
(771.6
|
)
|
|
|
246.6
|
|
Income tax benefit (expense)
|
|
|
|
0.6
|
|
|
|
(193.3
|
)
|
|
|
117.6
|
|
|
|
(213.6
|
)
|
Earnings (loss) from continuing operations
|
|
|
|
(234.0
|
)
|
|
|
12.9
|
|
|
|
(654.0
|
)
|
|
|
33.0
|
|
Discontinued operation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) from discontinued operation, net of taxes
|
|
|
|
-
|
|
|
|
(4.2
|
)
|
|
|
0.8
|
|
|
|
(2.4
|
)
|
Gain (adjustment to gain) on disposal of discontinued operation, net
of taxes
|
|
|
|
(7.2
|
)
|
|
|
-
|
|
|
|
332.7
|
|
|
|
-
|
|
|
|
|
|
(7.2
|
)
|
|
|
(4.2
|
)
|
|
|
333.5
|
|
|
|
(2.4
|
)
|
Net earnings (loss)
|
|
|
|
(241.2
|
)
|
|
|
8.7
|
|
|
|
(320.5
|
)
|
|
|
30.6
|
|
Net earnings attributable to noncontrolling interests
|
|
|
|
(8.7
|
)
|
|
|
(20.3
|
)
|
|
|
(8.2
|
)
|
|
|
(43.2
|
)
|
Net loss attributable to Liberty Global shareholders
|
|
|
|
$
|
(249.9
|
)
|
|
|
$
|
(11.6
|
)
|
|
|
$
|
(328.7
|
)
|
|
|
$
|
(12.6
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted earnings (loss) attributable to Liberty Global
shareholders per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
|
|
$
|
(0.31
|
)
|
|
|
$
|
(0.01
|
)
|
|
|
$
|
(0.84
|
)
|
|
|
$
|
(0.02
|
)
|
Discontinued operation
|
|
|
|
(0.01
|
)
|
|
|
(0.01
|
)
|
|
|
0.42
|
|
|
|
-
|
|
|
|
|
|
$
|
(0.32
|
)
|
|
|
$
|
(0.02
|
)
|
|
|
$
|
(0.42
|
)
|
|
|
$
|
(0.02
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liberty Global plc
|
Condensed Consolidated Statements of Cash Flows (unaudited)
|
|
|
|
|
|
Six months ended
|
|
|
|
|
June 30,
|
|
|
|
|
2014
|
|
|
2013
|
|
|
|
|
in millions
|
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
Net earnings (loss)
|
|
|
|
$
|
(320.5
|
)
|
|
|
$
|
30.6
|
|
Loss (earnings) from discontinued operation
|
|
|
|
(333.5
|
)
|
|
|
2.4
|
|
Earnings (loss) from continuing operations
|
|
|
|
(654.0
|
)
|
|
|
33.0
|
|
Adjustments to reconcile earnings (loss) from continuing operations
to net cash provided by operating activities
|
|
|
|
3,570.7
|
|
|
|
1,315.6
|
|
Net cash used by operating activities of discontinued operation
|
|
|
|
(9.6
|
)
|
|
|
(2.4
|
)
|
Net cash provided by operating activities
|
|
|
|
2,907.1
|
|
|
|
1,346.2
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
|
(1,402.0
|
)
|
|
|
(987.0
|
)
|
Proceeds received upon disposition of discontinued operation, net of
disposal costs
|
|
|
|
985.2
|
|
|
|
-
|
|
Cash paid in connection with acquisitions, net of cash acquired
|
|
|
|
(32.3
|
)
|
|
|
(4,064.2
|
)
|
Investments in and loans to affiliates and others
|
|
|
|
(18.6
|
)
|
|
|
(1,202.7
|
)
|
Other investing activities, net
|
|
|
|
11.1
|
|
|
|
(17.2
|
)
|
Net cash used by investing activities of discontinued operation
|
|
|
|
(3.8
|
)
|
|
|
(7.1
|
)
|
Net cash used by investing activities
|
|
|
|
(460.4
|
)
|
|
|
(6,278.2
|
)
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
Repayments and repurchases of debt and capital lease obligations
|
|
|
|
(6,328.9
|
)
|
|
|
(7,339.1
|
)
|
Borrowings of debt
|
|
|
|
3,605.8
|
|
|
|
8,845.2
|
|
Repurchase of Liberty Global and LGI shares
|
|
|
|
(895.9
|
)
|
|
|
(346.4
|
)
|
Net cash paid related to derivative instruments
|
|
|
|
(177.6
|
)
|
|
|
(4.4
|
)
|
Payment of financing costs and debt premiums
|
|
|
|
(172.2
|
)
|
|
|
(341.0
|
)
|
Net cash received (paid) associated with call option contracts on
Liberty Global and LGI shares
|
|
|
|
(98.8
|
)
|
|
|
45.2
|
|
Distributions by subsidiaries to noncontrolling interests
|
|
|
|
(2.2
|
)
|
|
|
(524.4
|
)
|
Decrease in restricted cash related to the Virgin Media Acquisition
|
|
|
|
-
|
|
|
|
3,594.4
|
|
Decrease in restricted cash related to the Telenet Tender
|
|
|
|
-
|
|
|
|
1,539.7
|
|
Purchase of additional Telenet shares
|
|
|
|
-
|
|
|
|
(454.5
|
)
|
Other financing activities, net
|
|
|
|
9.9
|
|
|
|
6.4
|
|
Net cash used by financing activities of discontinued operation
|
|
|
|
(1.2
|
)
|
|
|
(5.4
|
)
|
Net cash provided (used) by financing activities
|
|
|
|
(4,061.1
|
)
|
|
|
5,015.7
|
|
Effect of exchange rate changes on cash:
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
|
|
22.7
|
|
|
|
3.3
|
|
Discontinued operation
|
|
|
|
-
|
|
|
|
(0.9
|
)
|
Total
|
|
|
|
22.7
|
|
|
|
2.4
|
|
Net increase (decrease) in cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
|
|
(1,577.1
|
)
|
|
|
101.9
|
|
Discontinued operation
|
|
|
|
(14.6
|
)
|
|
|
(15.8
|
)
|
Net increase (decrease) in cash and cash equivalents
|
|
|
|
(1,591.7
|
)
|
|
|
86.1
|
|
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
Beginning of period
|
|
|
|
2,701.9
|
|
|
|
2,038.9
|
|
End of period
|
|
|
|
$
|
1,110.2
|
|
|
|
$
|
2,125.0
|
|
|
|
|
|
|
|
|
|
|
|
Cash paid for interest - continuing operations
|
|
|
|
$
|
1,199.1
|
|
|
|
$
|
886.2
|
|
|
|
|
|
|
|
|
|
|
|
Net cash paid for taxes:
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
|
|
$
|
54.5
|
|
|
|
$
|
54.6
|
|
Discontinued operation
|
|
|
|
2.2
|
|
|
|
6.2
|
|
Total
|
|
|
|
$
|
56.7
|
|
|
|
$
|
60.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue and Operating Cash Flow
In the following tables, we present revenue and operating cash flow by
reportable segment of our continuing operations for the three and six
months ended June 30, 2014, as compared to the corresponding prior year
periods. All of our reportable segments derive their revenue primarily
from broadband communications services, including video, broadband
internet and fixed-line telephony services. Most of our reportable
segments also provide B2B services and certain of our reportable
segments provide mobile services. Segment information for the prior
periods has been retrospectively revised to present the disposed
Chellomedia operations as a discontinued operation. Unless otherwise
noted, we present only the reportable segments of our continuing
operations in the tables below. For additional information, see note 15
to the condensed consolidated financial statements included in our most
recently filed Form 10-Q.
At June 30, 2014, our operating segments in the European Operations
Division provided broadband communications services in 12 European
countries and DTH services to customers in the Czech Republic, Hungary,
Romania and Slovakia through a Luxembourg-based organization that we
refer to as "UPC DTH." Our Other Western Europe segment includes our
broadband communications operating segments in Austria and Ireland. Our
Central and Eastern Europe segment includes our broadband communications
operating segments in the Czech Republic, Hungary, Poland, Romania and
Slovakia. The European Operations Division's central and other category
includes (i) the UPC DTH operating segment, (ii) costs associated with
certain centralized functions, including billing systems, network
operations, technology, marketing, facilities, finance and other
administrative functions, and (iii) intersegment eliminations within the
European Operations Division. In Chile, VTR includes VTR GlobalCom,
which provides video, broadband internet and fixed-line telephony
services, and VTR Wireless, which provides mobile services through a
third-party wireless access arrangement. Our corporate and other
category includes (a) less significant consolidated operating segments
that provide (1) broadband communications services in Puerto Rico and
(2) programming and other services and (b) our corporate category.
Intersegment eliminations primarily represent the elimination of
intercompany transactions between our broadband communications and
programming operations.
For purposes of calculating rebased growth rates on a comparable basis
for all businesses that we owned during 2014, we have adjusted our
historical revenue and OCF for the three and six months ended June 30,
2013 to (i) include the pre-acquisition revenue and OCF of certain
entities acquired during 2013 and 2014 in our rebased amounts for the
three and six months ended June 30, 2013 to the same extent that the
revenue and OCF of such entities are included in our results for the
three and six months ended June 30, 2014, (ii) remove intercompany
eliminations for the applicable periods in 2013 to conform to the
presentation during the 2014 periods following the disposal of the
Chellomedia operations, which resulted in previously eliminated
intercompany costs becoming third-party costs and (iii) reflect the
translation of our rebased amounts for the three and six months ended
June 30, 2013 at the applicable average foreign currency exchange rates
that were used to translate our results for the three and six months
ended June 30, 2014. We have included Virgin Media and four small
entities in whole or in part in the determination of our rebased revenue
and OCF for the three and six months ended June 30, 2013. We have
reflected the revenue and OCF of the acquired entities in our 2013
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 (i) any
significant differences between Generally Accepted Accounting Principles
in the United States ("GAAP") and local generally accepted accounting
principles, (ii) any significant effects of acquisition accounting
adjustments, (iii) any significant differences between our accounting
policies and those of the acquired entities and (iv) other items we deem
appropriate. We do not adjust pre-acquisition periods to eliminate
nonrecurring items or to give retroactive effect to any changes in
estimates that might be implemented during post-acquisition periods. As
we did not own or operate the acquired businesses during the
pre-acquisition periods, no assurance can be given that we have
identified all adjustments necessary to present the revenue and OCF of
these entities on a basis that is comparable to the corresponding
post-acquisition amounts that are included in our historical results or
that the pre-acquisition financial statements we have relied upon do not
contain undetected errors. The adjustments reflected in our rebased
amounts have not been prepared with a view towards complying with
Article 11 of Regulation S-X. In addition, the rebased growth
percentages are not necessarily indicative of the revenue and OCF that
would have occurred if these transactions had occurred on the dates
assumed for purposes of calculating our rebased amounts or the revenue
and OCF that will occur in the future. The rebased growth percentages
have been presented as a basis for assessing growth rates on a
comparable basis, and are not presented as a measure of our pro
forma financial performance. Therefore, we believe our rebased data is
not a non-GAAP financial measure as contemplated by Regulation G or Item
10 of Regulation S-K.
In each case, the following tables present (i) the amounts reported by
each of our reportable segments for the comparative periods, (ii) the
U.S. dollar change and percentage change from period to period and (iii)
the percentage change from period to period on a rebased basis:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
Increase
|
|
|
Increase
|
|
|
|
|
June 30,
|
|
|
(decrease)
|
|
|
(decrease)
|
Revenue
|
|
|
|
2014
|
|
|
2013
|
|
|
$
|
|
|
%
|
|
|
Rebased %
|
|
|
|
|
in millions, except % amounts
|
European Operations Division:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.K. (Virgin Media)
|
|
|
|
$
|
1,774.6
|
|
|
|
$
|
401.3
|
|
|
|
$
|
1,373.3
|
|
|
|
N.M.
|
|
|
3.0
|
|
Germany (Unitymedia KabelBW)
|
|
|
|
688.8
|
|
|
|
624.6
|
|
|
|
64.2
|
|
|
|
10.3
|
|
|
|
5.1
|
|
Belgium (Telenet)
|
|
|
|
582.4
|
|
|
|
534.4
|
|
|
|
48.0
|
|
|
|
9.0
|
|
|
|
3.9
|
|
The Netherlands
|
|
|
|
316.3
|
|
|
|
303.2
|
|
|
|
13.1
|
|
|
|
4.3
|
|
|
|
(0.6
|
)
|
Switzerland
|
|
|
|
365.3
|
|
|
|
323.9
|
|
|
|
41.4
|
|
|
|
12.8
|
|
|
|
6.3
|
|
Other Western Europe
|
|
|
|
233.5
|
|
|
|
219.6
|
|
|
|
13.9
|
|
|
|
6.3
|
|
|
|
1.1
|
|
Total Western Europe
|
|
|
|
3,960.9
|
|
|
|
2,407.0
|
|
|
|
1,553.9
|
|
|
|
64.6
|
|
|
|
3.4
|
|
Central and Eastern Europe
|
|
|
|
290.7
|
|
|
|
281.5
|
|
|
|
9.2
|
|
|
|
3.3
|
|
|
|
0.1
|
|
Central and other
|
|
|
|
32.6
|
|
|
|
31.5
|
|
|
|
1.1
|
|
|
|
3.5
|
|
|
|
*
|
Total European Operations Division
|
|
|
|
4,284.2
|
|
|
|
2,720.0
|
|
|
|
1,564.2
|
|
|
|
57.5
|
|
|
|
3.1
|
|
Chile (VTR)
|
|
|
|
229.8
|
|
|
|
252.7
|
|
|
|
(22.9
|
)
|
|
|
(9.1
|
)
|
|
|
4.0
|
|
Corporate and other
|
|
|
|
94.2
|
|
|
|
94.5
|
|
|
|
(0.3
|
)
|
|
|
(0.3
|
)
|
|
|
*
|
Intersegment eliminations
|
|
|
|
(6.0
|
)
|
|
|
(9.4
|
)
|
|
|
3.4
|
|
|
|
N.M.
|
|
|
*
|
Total
|
|
|
|
$
|
4,602.2
|
|
|
|
$
|
3,057.8
|
|
|
|
$
|
1,544.4
|
|
|
|
50.5
|
|
|
|
3.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liberty Global (excluding Virgin Media)
|
|
3.2
|
|
|
|
|
|
|
|
|
|
Six months ended
|
|
|
Increase
|
|
|
Increase
|
|
|
|
|
June 30,
|
|
|
(decrease)
|
|
|
(decrease)
|
Revenue
|
|
|
|
2014
|
|
|
2013
|
|
|
$
|
|
|
%
|
|
|
Rebased %
|
|
|
|
|
in millions, except % amounts
|
European Operations Division:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.K. (Virgin Media)
|
|
|
|
$
|
3,502.5
|
|
|
|
$
|
401.3
|
|
|
|
$
|
3,101.2
|
|
|
|
N.M.
|
|
|
2.0
|
|
Germany (Unitymedia KabelBW)
|
|
|
|
1,384.7
|
|
|
|
1,242.8
|
|
|
|
141.9
|
|
|
|
11.4
|
|
|
|
6.7
|
|
Belgium (Telenet)
|
|
|
|
1,156.6
|
|
|
|
1,070.6
|
|
|
|
86.0
|
|
|
|
8.0
|
|
|
|
3.5
|
|
The Netherlands
|
|
|
|
634.4
|
|
|
|
618.0
|
|
|
|
16.4
|
|
|
|
2.7
|
|
|
|
(1.6
|
)
|
Switzerland
|
|
|
|
718.1
|
|
|
|
649.9
|
|
|
|
68.2
|
|
|
|
10.5
|
|
|
|
4.9
|
|
Other Western Europe
|
|
|
|
464.1
|
|
|
|
442.2
|
|
|
|
21.9
|
|
|
|
5.0
|
|
|
|
0.3
|
|
Total Western Europe
|
|
|
|
7,860.4
|
|
|
|
4,424.8
|
|
|
|
3,435.6
|
|
|
|
77.6
|
|
|
|
2.9
|
|
Central and Eastern Europe
|
|
|
|
579.9
|
|
|
|
569.3
|
|
|
|
10.6
|
|
|
|
1.9
|
|
|
|
(0.2
|
)
|
Central and other
|
|
|
|
66.5
|
|
|
|
63.3
|
|
|
|
3.2
|
|
|
|
5.1
|
|
|
|
*
|
Total European Operations Division
|
|
|
|
8,506.8
|
|
|
|
5,057.4
|
|
|
|
3,449.4
|
|
|
|
68.2
|
|
|
|
2.7
|
|
Chile (VTR)
|
|
|
|
455.1
|
|
|
|
503.1
|
|
|
|
(48.0
|
)
|
|
|
(9.5
|
)
|
|
|
4.6
|
|
Corporate and other
|
|
|
|
187.3
|
|
|
|
187.5
|
|
|
|
(0.2
|
)
|
|
|
(0.1
|
)
|
|
|
*
|
Intersegment eliminations
|
|
|
|
(13.3
|
)
|
|
|
(18.3
|
)
|
|
|
5.0
|
|
|
|
N.M.
|
|
|
*
|
Total
|
|
|
|
$
|
9,135.9
|
|
|
|
$
|
5,729.7
|
|
|
|
$
|
3,406.2
|
|
|
|
59.4
|
|
|
|
2.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liberty Global (excluding Virgin Media)
|
|
3.2
|
|
|
|
|
|
* - Omitted; N.M. - Not Meaningful
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
Increase
|
|
|
Increase
|
|
|
|
|
June 30,
|
|
|
(decrease)
|
|
|
(decrease)
|
Operating Cash Flow
|
|
|
|
2014
|
|
|
2013
|
|
|
$
|
|
|
%
|
|
|
Rebased %
|
|
|
|
|
in millions, except % amounts
|
European Operations Division:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.K. (Virgin Media)
|
|
|
|
$
|
772.4
|
|
|
|
$
|
175.3
|
|
|
|
$
|
597.1
|
|
|
|
N.M.
|
|
|
6.2
|
|
Germany (Unitymedia KabelBW)
|
|
|
|
431.0
|
|
|
|
369.4
|
|
|
|
61.6
|
|
|
|
16.7
|
|
|
|
11.2
|
|
Belgium (Telenet)
|
|
|
|
287.9
|
|
|
|
269.2
|
|
|
|
18.7
|
|
|
|
6.9
|
|
|
|
2.0
|
|
The Netherlands
|
|
|
|
185.1
|
|
|
|
171.1
|
|
|
|
14.0
|
|
|
|
8.2
|
|
|
|
3.1
|
|
Switzerland
|
|
|
|
219.6
|
|
|
|
189.2
|
|
|
|
30.4
|
|
|
|
16.1
|
|
|
|
9.2
|
|
Other Western Europe
|
|
|
|
114.9
|
|
|
|
105.6
|
|
|
|
9.3
|
|
|
|
8.8
|
|
|
|
3.4
|
|
Total Western Europe
|
|
|
|
2,010.9
|
|
|
|
1,279.8
|
|
|
|
731.1
|
|
|
|
57.1
|
|
|
|
6.5
|
|
Central and Eastern Europe
|
|
|
|
136.9
|
|
|
|
135.1
|
|
|
|
1.8
|
|
|
|
1.3
|
|
|
|
(1.8
|
)
|
Central and other
|
|
|
|
(61.6
|
)
|
|
|
(54.2
|
)
|
|
|
(7.4
|
)
|
|
|
(13.7
|
)
|
|
|
*
|
Total European Operations Division
|
|
|
|
2,086.2
|
|
|
|
1,360.7
|
|
|
|
725.5
|
|
|
|
53.3
|
|
|
|
5.8
|
|
Chile (VTR)
|
|
|
|
85.8
|
|
|
|
86.8
|
|
|
|
(1.0
|
)
|
|
|
(1.2
|
)
|
|
|
12.7
|
|
Corporate and other
|
|
|
|
(27.1
|
)
|
|
|
(18.8
|
)
|
|
|
(8.3
|
)
|
|
|
(44.1
|
)
|
|
|
*
|
Intersegment eliminations
|
|
|
|
-
|
|
|
|
11.4
|
|
|
|
(11.4
|
)
|
|
|
N.M.
|
|
|
*
|
Total
|
|
|
|
$
|
2,144.9
|
|
|
|
$
|
1,440.1
|
|
|
|
$
|
704.8
|
|
|
|
48.9
|
|
|
|
5.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liberty Global (excluding Virgin Media)
|
|
5.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
|
|
Increase
|
|
|
Increase
|
|
|
|
|
June 30,
|
|
|
(decrease)
|
|
|
(decrease)
|
Operating Cash Flow
|
|
|
|
2014
|
|
|
2013
|
|
|
$
|
|
|
%
|
|
|
Rebased %
|
|
|
|
|
in millions, except % amounts
|
European Operations Division:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.K. (Virgin Media)
|
|
|
|
$
|
1,508.9
|
|
|
|
$
|
175.3
|
|
|
|
$
|
1,333.6
|
|
|
|
N.M.
|
|
|
6.0
|
|
Germany (Unitymedia KabelBW)
|
|
|
|
860.0
|
|
|
|
729.4
|
|
|
|
130.6
|
|
|
|
17.9
|
|
|
|
12.9
|
|
Belgium (Telenet)
|
|
|
|
590.0
|
|
|
|
516.7
|
|
|
|
73.3
|
|
|
|
14.2
|
|
|
|
9.4
|
|
The Netherlands
|
|
|
|
368.4
|
|
|
|
355.9
|
|
|
|
12.5
|
|
|
|
3.5
|
|
|
|
(0.8
|
)
|
Switzerland
|
|
|
|
426.0
|
|
|
|
371.4
|
|
|
|
54.6
|
|
|
|
14.7
|
|
|
|
8.8
|
|
Other Western Europe
|
|
|
|
228.0
|
|
|
|
210.4
|
|
|
|
17.6
|
|
|
|
8.4
|
|
|
|
3.5
|
|
Total Western Europe
|
|
|
|
3,981.3
|
|
|
|
2,359.1
|
|
|
|
1,622.2
|
|
|
|
68.8
|
|
|
|
7.4
|
|
Central and Eastern Europe
|
|
|
|
283.9
|
|
|
|
275.7
|
|
|
|
8.2
|
|
|
|
3.0
|
|
|
|
1.0
|
|
Central and other
|
|
|
|
(121.3
|
)
|
|
|
(100.0
|
)
|
|
|
(21.3
|
)
|
|
|
(21.3
|
)
|
|
|
*
|
Total European Operations Division
|
|
|
|
4,143.9
|
|
|
|
2,534.8
|
|
|
|
1,609.1
|
|
|
|
63.5
|
|
|
|
6.7
|
|
Chile (VTR)
|
|
|
|
168.5
|
|
|
|
172.0
|
|
|
|
(3.5
|
)
|
|
|
(2.0
|
)
|
|
|
13.1
|
|
Corporate and other
|
|
|
|
(44.0
|
)
|
|
|
(29.4
|
)
|
|
|
(14.6
|
)
|
|
|
(49.7
|
)
|
|
|
*
|
Intersegment eliminations
|
|
|
|
4.0
|
|
|
|
22.7
|
|
|
|
(18.7
|
)
|
|
|
N.M.
|
|
|
*
|
Total
|
|
|
|
$
|
4,272.4
|
|
|
|
$
|
2,700.1
|
|
|
|
$
|
1,572.3
|
|
|
|
58.2
|
|
|
|
6.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Liberty Global (excluding Virgin Media)
|
|
7.0
|
|
|
|
|
|
* - Omitted; N.M. - Not Meaningful
|
|
Operating Cash Flow Definition and Reconciliation
OCF is the primary measure used by our chief operating decision maker to
evaluate segment operating performance. OCF is also a key factor that is
used by our internal decision makers to (i) determine how to allocate
resources to segments and (ii) evaluate the effectiveness of our
management for purposes of annual and other incentive compensation
plans. As we use the term, OCF is defined as revenue less operating and
SG&A expenses (excluding 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 (a) gains and losses on the
disposition of long-lived assets, (b) third-party costs directly
associated with successful and unsuccessful acquisitions and
dispositions, including legal, advisory and due diligence fees, as
applicable, and (c) other acquisition-related items, such as gains and
losses on the settlement of contingent consideration. Our internal
decision makers believe operating cash flow is a meaningful measure and
is superior to available U.S. GAAP measures because it represents a
transparent view of our recurring operating performance that is
unaffected by our capital structure and allows management to (1) readily
view operating trends, (2) perform analytical comparisons and
benchmarking between segments and (3) identify strategies to improve
operating performance in the different countries in which we operate. We
believe our operating cash flow measure is useful to investors because
it is one of the bases for comparing our performance with the
performance of other companies in the same or similar industries,
although our measure may not be directly comparable to similar measures
used by other public companies. OCF should be viewed as a measure of
operating performance that is a supplement to, and not a substitute for,
operating income, net earnings (loss), cash flow from operating
activities and other GAAP measures of income or cash flows. A
reconciliation of total segment operating cash flow to our operating
income is presented below.
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
Six months ended
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
in millions
|
Total segment operating cash flow
|
|
|
|
$
|
2,144.9
|
|
|
|
$
|
1,440.1
|
|
|
|
$
|
4,272.4
|
|
|
|
$
|
2,700.1
|
|
Share-based compensation expense
|
|
|
|
(54.4
|
)
|
|
|
(93.4
|
)
|
|
|
(109.5
|
)
|
|
|
(119.7
|
)
|
Depreciation and amortization
|
|
|
|
(1,393.4
|
)
|
|
|
(855.8
|
)
|
|
|
(2,770.5
|
)
|
|
|
(1,540.4
|
)
|
Impairment, restructuring and other operating items, net
|
|
|
|
(27.6
|
)
|
|
|
(45.8
|
)
|
|
|
(141.2
|
)
|
|
|
(66.7
|
)
|
Operating income
|
|
|
|
$
|
669.5
|
|
|
|
$
|
445.1
|
|
|
|
$
|
1,251.2
|
|
|
|
$
|
973.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of Debt, Capital Lease Obligations and Cash and Cash
Equivalents
The following table1 details the U.S. dollar equivalent
balances of our third-party consolidated debt, capital lease obligations
and cash and cash equivalents at June 30, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
|
|
|
Debt & Capital
|
|
|
Cash
|
|
|
|
|
|
|
|
Lease
|
|
|
Lease
|
|
|
and Cash
|
|
|
|
|
Debt2
|
|
|
Obligations
|
|
|
Obligations
|
|
|
Equivalents
|
|
|
|
|
in millions
|
Liberty Global and unrestricted subsidiaries
|
|
|
|
$
|
1,722.0
|
|
|
$
|
40.5
|
|
|
$
|
1,762.5
|
|
|
$
|
577.2
|
Virgin Media3
|
|
|
|
13,653.5
|
|
|
350.7
|
|
|
14,004.2
|
|
|
72.6
|
UPC Holding
|
|
|
|
10,864.7
|
|
|
31.2
|
|
|
10,895.9
|
|
|
72.0
|
Unitymedia KabelBW
|
|
|
|
7,809.8
|
|
|
931.0
|
|
|
8,740.8
|
|
|
27.4
|
Telenet
|
|
|
|
4,636.3
|
|
|
466.2
|
|
|
5,102.5
|
|
|
249.0
|
VTR Finance
|
|
|
|
1,400.0
|
|
|
0.7
|
|
|
1,400.7
|
|
|
110.5
|
Liberty Puerto Rico
|
|
|
|
652.3
|
|
|
1.3
|
|
|
653.6
|
|
|
1.5
|
Total Liberty Global
|
|
|
|
$
|
40,738.6
|
|
|
$
|
1,821.6
|
|
|
$
|
42,560.2
|
|
|
$
|
1,110.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and Equipment Additions and Capital Expenditures
The table below highlights the categories of our property and equipment
additions for the indicated periods and reconciles those additions to
the capital expenditures that we present in our condensed consolidated
statements of cash flows:
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
Six months ended
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
in millions, except % amounts
|
Customer premises equipment
|
|
|
|
$
|
354.3
|
|
|
|
$
|
209.4
|
|
|
|
$
|
698.8
|
|
|
|
$
|
452.2
|
|
Scalable infrastructure
|
|
|
|
174.7
|
|
|
|
160.8
|
|
|
|
343.5
|
|
|
|
236.2
|
|
Line extensions
|
|
|
|
89.9
|
|
|
|
104.6
|
|
|
|
196.7
|
|
|
|
172.0
|
|
Upgrade/rebuild
|
|
|
|
138.1
|
|
|
|
95.0
|
|
|
|
272.9
|
|
|
|
169.8
|
|
Support capital & other
|
|
|
|
213.8
|
|
|
|
165.5
|
|
|
|
369.1
|
|
|
|
236.1
|
|
Property and equipment additions
|
|
|
|
970.8
|
|
|
|
735.3
|
|
|
|
1,881.0
|
|
|
|
1,266.3
|
|
Assets acquired under capital-related vendor financing arrangements
|
|
|
|
(231.3
|
)
|
|
|
(145.5
|
)
|
|
|
(401.8
|
)
|
|
|
(221.6
|
)
|
Assets acquired under capital leases
|
|
|
|
(40.8
|
)
|
|
|
(26.6
|
)
|
|
|
(89.8
|
)
|
|
|
(44.9
|
)
|
Changes in current liabilities related to capital expenditures
|
|
|
|
(31.7
|
)
|
|
|
(75.6
|
)
|
|
|
12.6
|
|
|
|
(12.8
|
)
|
Capital expenditures4
|
|
|
|
$
|
667.0
|
|
|
|
$
|
487.6
|
|
|
|
$
|
1,402.0
|
|
|
|
$
|
987.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment additions as % of revenue
|
|
|
|
21.1
|
%
|
|
|
24.0
|
%
|
|
|
20.6
|
%
|
|
|
22.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_________________________________
|
1
|
|
|
|
Except as otherwise indicated, the amounts reported in the table
include the named entity and its subsidiaries.
|
2
|
|
|
|
Debt amounts for UPC Holding and Telenet include senior secured
notes issued by special purpose entities that are consolidated by
each.
|
3
|
|
|
|
The Virgin Media borrowing group includes certain subsidiaries of
Virgin Media Inc. ("Virgin Media"), but excludes Virgin Media. The
cash and cash equivalents amount includes cash and cash equivalents
held by the Virgin Media borrowing group, but excludes $128 million
of cash and cash equivalents held by Virgin Media. This amount is
included in the amount shown for Liberty Global and unrestricted
subsidiaries. In addition, the $57 million carrying value of the
6.5% convertible notes of Virgin Media is excluded from the debt of
the Virgin Media borrowing group and included in the debt of Liberty
Global and unrestricted subsidiaries.
|
4
|
|
|
|
The capital expenditures that we report in our condensed
consolidated statements of cash flows do not include amounts that
are financed under vendor financing or capital lease arrangements.
Instead, these expenditures are reflected as non-cash additions to
our property and equipment when the underlying assets are delivered,
and as repayments of debt when the related principal is repaid.
|
|
|
|
|
|
Free Cash Flow and Adjusted Free Cash Flow Definition and
Reconciliation
We define free cash flow as net cash provided by our operating
activities, plus (i) excess tax benefits related to the exercise of
share-based incentive awards and (ii) cash payments for third-party
costs directly associated with successful and unsuccessful acquisitions
and dispositions, less (a) capital expenditures, as reported in our
consolidated statements of cash flows, (b) principal payments on vendor
financing obligations and (c) principal payments on capital leases
(exclusive of the portions of the network lease in Belgium and the duct
leases in Germany that we assumed in connection with certain
acquisitions), with each item excluding any cash provided or used by our
discontinued operations. We also present Adjusted FCF, which adjusts FCF
to eliminate the incremental FCF deficit associated with the VTR
Wireless mobile initiative and certain financing and other costs
associated with the Virgin Media acquisition. We believe that our
presentation of free cash flow provides useful information to our
investors because this measure can be used to gauge our ability to
service debt and fund new investment opportunities. Free cash flow
should not be understood to represent our ability to fund discretionary
amounts, as we have various mandatory and contractual obligations,
including debt repayments, which are not deducted to arrive at this
amount. Investors should view free cash flow as a supplement to, and not
a substitute for, GAAP measures of liquidity included in our
consolidated statements of cash flows. The following table provides the
reconciliation of our continuing operations' net cash provided by
operating activities to FCF and Adjusted FCF for the indicated periods:
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
Six months ended
|
|
|
|
|
June 30,
|
|
|
June 30,
|
|
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
in millions
|
Net cash provided by operating activities of our continuing
operations
|
|
|
|
$
|
1,596.3
|
|
|
|
$
|
796.9
|
|
|
|
$
|
2,916.7
|
|
|
|
$
|
1,348.6
|
|
Excess tax benefits from share-based compensation5
|
|
|
|
-
|
|
|
|
(0.8
|
)
|
|
|
-
|
|
|
|
0.5
|
|
Cash payments for direct acquisition and disposition costs6
|
|
|
|
9.2
|
|
|
|
30.0
|
|
|
|
20.4
|
|
|
|
38.4
|
|
Capital expenditures
|
|
|
|
(667.0
|
)
|
|
|
(487.6
|
)
|
|
|
(1,402.0
|
)
|
|
|
(987.0
|
)
|
Principal payments on vendor financing obligations
|
|
|
|
(177.1
|
)
|
|
|
(130.4
|
)
|
|
|
(397.9
|
)
|
|
|
(167.4
|
)
|
Principal payments on certain capital leases
|
|
|
|
(50.8
|
)
|
|
|
(5.1
|
)
|
|
|
(97.2
|
)
|
|
|
(8.2
|
)
|
FCF
|
|
|
|
$
|
710.6
|
|
|
|
$
|
203.0
|
|
|
|
$
|
1,040.0
|
|
|
|
$
|
224.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FCF
|
|
|
|
$
|
710.6
|
|
|
|
$
|
203.0
|
|
|
|
$
|
1,040.0
|
|
|
|
$
|
224.9
|
|
FCF deficit of VTR Wireless
|
|
|
|
14.1
|
|
|
|
34.0
|
|
|
|
34.7
|
|
|
|
78.4
|
|
Virgin Media acquisition adjustments7
|
|
|
|
-
|
|
|
|
32.3
|
|
|
|
-
|
|
|
|
32.3
|
|
Adjusted FCF
|
|
|
|
$
|
724.7
|
|
|
|
$
|
269.3
|
|
|
|
$
|
1,074.7
|
|
|
|
$
|
335.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
______________________________________
|
5
|
|
|
|
Excess tax benefits from share-based compensation represent the
excess of tax deductions over the related financial reporting
share-based compensation expense. The hypothetical cash flows
associated with these excess tax benefits are reported as an
increase to cash flows from financing activities and a corresponding
decrease to cash flows from operating activities in our consolidated
cash flow statements.
|
6
|
|
|
|
Represents costs paid during the period to third parties directly
related to acquisitions and dispositions.
|
7
|
|
|
|
Represents costs associated with the Virgin Media Acquisition
consisting of (i) cash paid of $19.8 million during the period
related to the pre-acquisition costs of the new Virgin Media capital
structure and (ii) cash paid of $12.5 million during the period for
withholding taxes associated with certain intercompany transactions
completed in connection with the Virgin Media Acquisition.
|
|
|
|
|
|
Combined Free Cash Flow and Adjusted Free Cash Flow Information for
Historical Q2 and YTD 2013
The combined amounts presented below have been included in this release
to provide a means for comparison. The Liberty Global amounts presented
below are on a reported basis. The Virgin Media pre-acquisition amounts
presented below are on a reported basis for the period from January 1,
2013 to June 7, 2013, as adjusted to conform to the FCF and Adjusted FCF
definitions of Liberty Global as set forth earlier. The Virgin Media
pre-acquisition amounts have been converted into U.S. dollars at the
average GBP/USD foreign exchange rate for the pre-acquisition period in
2013 as applicable. The combined Liberty Global/Virgin Media results
have not been prepared with a view towards complying with Article 11 of
Regulation S-X. In addition, the combined Liberty Global/Virgin Media
results are not necessarily indicative of the FCF and Adjusted FCF that
would have occurred if the Liberty Global/Virgin Media transaction had
occurred on the dates assumed for purposes of calculating the combined
results, or the FCF and Adjusted FCF that will occur in the future. The
below FCF and Adjusted FCF table should be read in conjunction with the
information included in the footnotes to the tables on page 17.
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
|
|
June 30, 2013
|
|
|
|
|
|
|
|
Virgin
|
|
|
|
|
|
|
Liberty
|
|
|
Media Pre-
|
|
|
|
|
|
|
Global
|
|
|
acquisition
|
|
Combined
|
|
|
|
|
in millions
|
Net cash provided by operating activities of our continuing
operations
|
|
|
|
$
|
796.9
|
|
|
|
$
|
433.8
|
|
|
$
|
1,230.7
|
|
Excess tax benefits from share-based compensation
|
|
|
|
(0.8
|
)
|
|
|
-
|
|
|
(0.8
|
)
|
Cash payments for direct acquisition and disposition costs
|
|
|
|
30.0
|
|
|
|
76.7
|
|
|
106.7
|
|
Capital expenditures
|
|
|
|
(487.6
|
)
|
|
|
(213.9
|
)
|
|
(701.5
|
)
|
Principal payments on vendor financing obligations
|
|
|
|
(130.4
|
)
|
|
|
-
|
|
|
(130.4
|
)
|
Principal payments on certain capital leases
|
|
|
|
(5.1
|
)
|
|
|
(34.4
|
)
|
|
(39.5
|
)
|
FCF
|
|
|
|
$
|
203.0
|
|
|
|
$
|
262.2
|
|
|
$
|
465.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FCF
|
|
|
|
$
|
203.0
|
|
|
|
$
|
262.2
|
|
|
$
|
465.2
|
|
FCF deficit of VTR Wireless
|
|
|
|
34.0
|
|
|
|
-
|
|
|
34.0
|
|
Virgin Media acquisition adjustments
|
|
|
|
32.3
|
|
|
|
-
|
|
|
32.3
|
|
Adjusted FCF
|
|
|
|
$
|
269.3
|
|
|
|
$
|
262.2
|
|
|
$
|
531.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
|
|
|
|
June 30, 2013
|
|
|
|
|
|
|
|
Virgin
|
|
|
|
|
|
|
|
Liberty
|
|
|
Media Pre-
|
|
|
|
|
|
|
|
Global
|
|
|
acquisition
|
|
|
Combined
|
|
in millions
|
Net cash provided by operating activities of our continuing
operations
|
|
|
|
$
|
1,348.6
|
|
|
|
$
|
906.1
|
|
|
|
$
|
2,254.7
|
|
Excess tax benefits from share-based compensation
|
|
|
|
0.5
|
|
|
|
-
|
|
|
|
0.5
|
|
Cash payments for direct acquisition and disposition costs
|
|
|
|
38.4
|
|
|
|
80.0
|
|
|
|
118.4
|
|
Capital expenditures
|
|
|
|
(987.0
|
)
|
|
|
(483.1
|
)
|
|
|
(1,470.1
|
)
|
Principal payments on vendor financing obligations
|
|
|
|
(167.4
|
)
|
|
|
-
|
|
|
|
(167.4
|
)
|
Principal payments on certain capital leases
|
|
|
|
(8.2
|
)
|
|
|
(69.4
|
)
|
|
|
(77.6
|
)
|
FCF
|
|
|
|
$
|
224.9
|
|
|
|
$
|
433.6
|
|
|
|
$
|
658.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FCF
|
|
|
|
$
|
224.9
|
|
|
|
$
|
433.6
|
|
|
|
$
|
658.5
|
|
FCF deficit of VTR Wireless
|
|
|
|
78.4
|
|
|
|
-
|
|
|
|
78.4
|
|
Virgin Media acquisition adjustments
|
|
|
|
32.3
|
|
|
|
-
|
|
|
|
32.3
|
|
Adjusted FCF
|
|
|
|
$
|
335.6
|
|
|
|
$
|
433.6
|
|
|
|
$
|
769.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Combined Revenue, Property & Equipment Additions and OCF for
Historical Q2 and YTD 2013
The combined amounts presented below have been included in this release
to provide a means for comparison. The Liberty Global amounts presented
below are on a reported basis. The Virgin Media pre-acquisition amounts
presented below are on a reported basis for the period from January 1,
2013 to June 7, 2013. The Virgin Media pre-acquisition amounts have been
converted into U.S. dollars at the average GBP/USD foreign exchange rate
for the pre-acquisition period in 2013 as applicable. The combined
Liberty Global/Virgin Media results have not been prepared with a view
towards complying with Article 11 of Regulation S-X.
|
|
|
|
|
|
|
|
|
Three months ended
|
|
|
|
|
June 30, 2013
|
|
|
|
|
|
|
|
Virgin Media
|
|
|
|
|
|
|
|
Liberty
|
|
|
Pre-
|
|
|
|
|
|
|
|
Global
|
|
|
acquisition
|
|
|
Combined
|
|
|
|
|
in millions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
$
|
3,057.8
|
|
|
|
$
|
1,174.6
|
|
|
|
$
|
4,232.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OCF
|
|
|
|
$
|
1,440.1
|
|
|
|
$
|
480.4
|
|
|
|
$
|
1,920.5
|
|
Share-based compensation
|
|
|
|
(93.4
|
)
|
|
|
(17.7
|
)
|
|
|
(111.1
|
)
|
Depreciation and amortization
|
|
|
|
(855.8
|
)
|
|
|
(280.8
|
)
|
|
|
(1,136.6
|
)
|
Impairment, restructuring and other
|
|
|
|
(45.8
|
)
|
|
|
(67.3
|
)
|
|
|
(113.1
|
)
|
Operating Income
|
|
|
|
$
|
445.1
|
|
|
|
$
|
114.6
|
|
|
|
$
|
559.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property & Equipment Additions
|
|
|
|
$
|
735.3
|
|
|
|
$
|
256.9
|
|
|
|
$
|
992.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OCF Margin
|
|
|
|
47.1
|
%
|
|
|
40.9
|
%
|
|
|
45.4
|
%
|
Property & Equipment Additions as a percentage of Revenue
|
|
|
|
24.0
|
%
|
|
|
21.9
|
%
|
|
|
23.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
|
|
|
|
June 30, 2013
|
|
|
|
|
|
|
|
Virgin Media
|
|
|
|
|
|
|
|
Liberty
|
|
|
Pre-
|
|
|
|
|
|
|
|
Global
|
|
|
acquisition
|
|
|
Combined
|
|
|
|
|
in millions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
|
|
$
|
5,729.7
|
|
|
|
$
|
2,790.1
|
|
|
|
$
|
8,519.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OCF
|
|
|
|
$
|
2,700.1
|
|
|
|
$
|
1,126.1
|
|
|
|
$
|
3,826.2
|
|
Share-based compensation
|
|
|
|
(119.7
|
)
|
|
|
(33.8
|
)
|
|
|
(153.5
|
)
|
Depreciation and amortization
|
|
|
|
(1,540.4
|
)
|
|
|
(667.1
|
)
|
|
|
(2,207.5
|
)
|
Impairment, restructuring and other
|
|
|
|
(66.7
|
)
|
|
|
(78.5
|
)
|
|
|
(145.2
|
)
|
Operating Income
|
|
|
|
$
|
973.3
|
|
|
|
$
|
346.7
|
|
|
|
$
|
1,320.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property & Equipment Additions
|
|
|
|
$
|
1,266.3
|
|
|
|
$
|
598.7
|
|
|
|
$
|
1,865.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OCF Margin
|
|
|
|
47.1
|
%
|
|
|
40.4
|
%
|
|
|
44.9
|
%
|
Property & Equipment Additions as a percentage of Revenue
|
|
|
|
22.1
|
%
|
|
|
21.5
|
%
|
|
|
21.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ARPU per Customer Relationship
The following table provides ARPU per customer relationship8
for the indicated periods:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended June 30,
|
|
|
%
|
|
|
FX-Neutral
|
|
|
|
|
2014
|
|
2013
|
|
|
Change
|
|
|
% Change10
|
Liberty Global Consolidated9
|
|
|
|
$
|
50.09
|
|
|
$
|
40.74
|
|
|
|
23.0
|
%
|
|
|
18.6
|
%
|
European Operations Consolidated9
|
|
|
|
€
|
35.95
|
|
|
€
|
29.62
|
|
|
|
21.4
|
%
|
|
|
20.8
|
%
|
U.K. (Virgin Media)9
|
|
|
|
£
|
49.95
|
|
|
£
|
48.66
|
|
|
|
2.7
|
%
|
|
|
2.7
|
%
|
Germany (Unitymedia KabelBW)
|
|
|
|
€
|
21.36
|
|
|
€
|
20.24
|
|
|
|
5.5
|
%
|
|
|
5.5
|
%
|
Belgium (Telenet)
|
|
|
|
€
|
50.83
|
|
|
€
|
48.06
|
|
|
|
5.8
|
%
|
|
|
5.8
|
%
|
Other Europe
|
|
|
|
€
|
30.09
|
|
|
€
|
28.87
|
|
|
|
4.2
|
%
|
|
|
4.4
|
%
|
VTR
|
|
|
|
CLP
|
31,699
|
|
|
CLP
|
31,268
|
|
|
|
1.4
|
%
|
|
|
1.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mobile Statistics11
The following tables provide ARPU per mobile subscriber12 and
mobile subscribers13 for the indicated periods:
|
|
|
|
|
|
|
|
|
ARPU per Mobile Subscriber
|
|
|
|
|
Three months ended June 30,
|
|
|
%
|
|
|
FX-Neutral
|
|
|
|
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
% Change10
|
Liberty Global Consolidated:9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Including interconnect revenue
|
|
|
|
$
|
26.68
|
|
|
|
$
|
26.58
|
|
|
|
0.4
|
%
|
|
|
(5.0
|
)%
|
Excluding interconnect revenue
|
|
|
|
$
|
21.68
|
|
|
|
$
|
20.30
|
|
|
|
6.8
|
%
|
|
|
1.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mobile Subscribers
|
|
|
|
|
June 30, 2014
|
|
|
March 31, 2014
|
|
|
Change
|
European Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.K. (Virgin Media)
|
|
|
|
3,041,300
|
|
|
|
2,998,500
|
|
|
|
42,800
|
|
Germany (Unitymedia KabelBW)
|
|
|
|
276,400
|
|
|
|
255,300
|
|
|
|
21,100
|
|
Belgium (Telenet)
|
|
|
|
820,800
|
|
|
|
779,800
|
|
|
|
41,000
|
|
The Netherlands
|
|
|
|
2,500
|
|
|
|
3,500
|
|
|
|
(1,000
|
)
|
Switzerland
|
|
|
|
500
|
|
|
|
-
|
|
|
|
500
|
|
Total Western Europe
|
|
|
|
4,141,500
|
|
|
|
4,037,100
|
|
|
|
104,400
|
|
Poland
|
|
|
|
13,300
|
|
|
|
14,600
|
|
|
|
(1,300
|
)
|
Hungary
|
|
|
|
9,300
|
|
|
|
8,500
|
|
|
|
800
|
|
Total CEE
|
|
|
|
22,600
|
|
|
|
23,100
|
|
|
|
(500
|
)
|
Total European Operations
|
|
|
|
4,164,100
|
|
|
|
4,060,200
|
|
|
|
103,900
|
|
Chile (VTR Wireless)
|
|
|
|
89,700
|
|
|
|
83,000
|
|
|
|
6,700
|
|
Grand Total
|
|
|
|
4,253,800
|
|
|
|
4,143,200
|
|
|
|
110,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
_________________________________
|
|
8
|
|
|
|
Average Revenue Per Unit ("ARPU") refers to the average monthly
subscription revenue per average customer relationship and is
calculated by dividing the average monthly subscription revenue
(excluding installation, late fees, interconnect and mobile services
revenue) for the indicated period, by the average of the opening and
closing balances for customer relationships for the period. Customer
relationships of entities acquired during the period are normalized.
Unless otherwise indicated, ARPU per customer relationship for the
Liberty Global Consolidated, the European Operations Division and
Other Europe are not adjusted for currency impacts
|
.
|
9
|
|
|
|
The Liberty Global consolidated and Virgin Media ARPU calculations
for the 2013 period only include Virgin Media results for the 23-day
post-acquisition stub period.
|
|
10
|
|
|
|
The FX-neutral change represents the percentage change on a
year-over-year basis adjusted for FX impacts and is calculated by
adjusting the prior year figures to reflect translation at the
foreign currency rates used to translate the current year amounts.
|
|
11
|
|
|
|
Please see page 7 for the definition of mobile subscriber.
|
|
12
|
|
|
|
Our ARPU per mobile subscriber calculation that excludes
interconnect revenue refers to the average monthly mobile
subscription revenue per average mobile subscribers in service and
is calculated by dividing the average monthly mobile subscription
revenue (excluding activation, handset fees and late fees) for the
indicated period, by the average of the opening and closing balances
of mobile subscribers in service for the period. Our ARPU per mobile
subscriber calculation that includes interconnect revenue increases
the numerator in the above-described calculation by the amount of
mobile interconnect revenue during the period.
|
|
13
|
|
|
|
With the exception of the U.K. and Chile, all of our mobile
subscribers receive mobile services pursuant to postpaid contracts.
As of June 30, 2014 and March 31, 2014, the mobile subscriber count
in the U.K. included 1,021,000 and 1,040,800 prepaid mobile
subscribers, respectively, and the mobile subscriber count in Chile
included 24,500 and 29,200 prepaid mobile subscribers, respectively.
|
|
|
|
|
|
|
|
RGUs, Customers and Bundling
The following table provides information on the breakdown of our RGUs
and customer base and highlights our customer bundling metrics at
June 30, 2014, March 31, 2014 and June 30, 2013:
|
|
|
|
June 30,
|
|
|
March 31,
|
|
|
June 30,
|
|
|
Q2'14 / Q1'14
|
|
|
Q2'14 / Q2'13
|
|
|
|
|
2014
|
|
|
2014
|
|
|
2013
|
|
|
(% Change)
|
|
|
(% Change)
|
Total RGUs
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Video RGUs
|
|
|
|
21,658,200
|
|
|
21,727,400
|
|
|
21,877,900
|
|
|
(0.3
|
%)
|
|
|
(1.0
|
%)
|
Total Broadband Internet RGUs
|
|
|
|
14,822,300
|
|
|
14,611,800
|
|
|
13,881,600
|
|
|
1.4
|
%
|
|
|
6.8
|
%
|
Total Telephony RGUs
|
|
|
|
12,424,900
|
|
|
12,298,100
|
|
|
11,772,100
|
|
|
1.0
|
%
|
|
|
5.5
|
%
|
Liberty Global Consolidated
|
|
|
|
48,905,400
|
|
|
48,637,300
|
|
|
47,531,600
|
|
|
0.6
|
%
|
|
|
2.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Customers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
European Operations Division
|
|
|
|
22,970,500
|
|
|
23,018,600
|
|
|
23,019,000
|
|
|
(0.2
|
%)
|
|
|
(0.2
|
%)
|
VTR
|
|
|
|
1,224,700
|
|
|
1,210,300
|
|
|
1,182,900
|
|
|
1.2
|
%
|
|
|
3.5
|
%
|
Puerto Rico
|
|
|
|
275,700
|
|
|
275,300
|
|
|
272,100
|
|
|
0.1
|
%
|
|
|
1.3
|
%
|
Liberty Global Consolidated
|
|
|
|
24,470,900
|
|
|
24,504,200
|
|
|
24,474,000
|
|
|
(0.1
|
%)
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Single-Play Customers
|
|
|
|
10,291,200
|
|
|
10,468,700
|
|
|
10,954,400
|
|
|
(1.7
|
%)
|
|
|
(6.1
|
%)
|
Total Double-Play Customers
|
|
|
|
3,925,000
|
|
|
3,937,900
|
|
|
3,981,600
|
|
|
(0.3
|
%)
|
|
|
(1.4
|
%)
|
Total Triple-Play Customers
|
|
|
|
10,254,700
|
|
|
10,097,600
|
|
|
9,538,000
|
|
|
1.6
|
%
|
|
|
7.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% Double-Play Customers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
European Operations Division
|
|
|
|
15.7
|
%
|
|
15.7
|
%
|
|
15.9
|
%
|
|
-
|
|
|
|
(1.3
|
%)
|
VTR
|
|
|
|
21.1
|
%
|
|
21.2
|
%
|
|
20.9
|
%
|
|
(0.5
|
%)
|
|
|
1.0
|
%
|
Liberty Global Consolidated
|
|
|
|
16.0
|
%
|
|
16.1
|
%
|
|
16.3
|
%
|
|
(0.6
|
%)
|
|
|
(1.8
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% Triple-Play Customers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
European Operations Division
|
|
|
|
41.6
|
%
|
|
40.9
|
%
|
|
38.7
|
%
|
|
1.7
|
%
|
|
|
7.5
|
%
|
VTR
|
|
|
|
47.1
|
%
|
|
46.7
|
%
|
|
46.5
|
%
|
|
0.9
|
%
|
|
|
1.3
|
%
|
Liberty Global Consolidated
|
|
|
|
41.9
|
%
|
|
41.2
|
%
|
|
39.0
|
%
|
|
1.7
|
%
|
|
|
7.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RGUs per Customer Relationship
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
European Operations Division
|
|
|
|
1.99
|
|
1.98
|
|
1.93
|
|
0.5
|
%
|
|
|
3.1
|
%
|
VTR
|
|
|
|
2.15
|
|
2.15
|
|
2.14
|
|
-
|
|
|
|
0.5
|
%
|
Liberty Global Consolidated
|
|
|
|
2.00
|
|
1.98
|
|
1.94
|
|
1.0
|
%
|
|
|
3.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Operating Data - June 30, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Video
|
|
|
|
|
|
|
|
|
|
|
|
Homes Passed(1)
|
|
|
Two-way Homes Passed(2)
|
|
|
Customer Relationships(3)
|
|
|
Total RGUs(4)
|
|
|
Analog Cable Subscribers(5)
|
|
|
Digital Cable Subscribers(6)
|
|
|
DTH Subscribers(7)
|
|
|
MMDS Subscribers(8)
|
|
|
Total Video
|
|
|
Internet Subscribers(9)
|
|
|
Telephony Subscribers(10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
European Operations Division:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.K.
|
|
|
|
12,539,700
|
|
|
|
12,539,700
|
|
|
|
4,912,900
|
|
|
|
12,294,300
|
|
|
|
-
|
|
|
|
3,733,700
|
|
|
|
-
|
|
|
|
-
|
|
|
|
3,733,700
|
|
|
|
4,415,500
|
|
|
|
4,145,100
|
Germany
|
|
|
|
12,658,700
|
|
|
|
12,321,600
|
|
|
|
7,098,800
|
|
|
|
11,949,200
|
|
|
|
4,327,400
|
|
|
|
2,257,500
|
|
|
|
-
|
|
|
|
-
|
|
|
|
6,584,900
|
|
|
|
2,742,900
|
|
|
|
2,621,400
|
Belgium
|
|
|
|
2,905,000
|
|
|
|
2,905,000
|
|
|
|
2,076,600
|
|
|
|
4,676,800
|
|
|
|
548,300
|
|
|
|
1,528,300
|
|
|
|
-
|
|
|
|
-
|
|
|
|
2,076,600
|
|
|
|
1,492,900
|
|
|
|
1,107,300
|
The Netherlands(11)
|
|
|
|
2,843,700
|
|
|
|
2,830,700
|
|
|
|
1,605,700
|
|
|
|
3,697,500
|
|
|
|
483,600
|
|
|
|
1,119,900
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,603,500
|
|
|
|
1,098,400
|
|
|
|
995,600
|
Switzerland(11)
|
|
|
|
2,155,800
|
|
|
|
2,154,000
|
|
|
|
1,454,600
|
|
|
|
2,581,800
|
|
|
|
732,200
|
|
|
|
683,100
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,415,300
|
|
|
|
700,500
|
|
|
|
466,000
|
Austria
|
|
|
|
1,340,200
|
|
|
|
1,340,200
|
|
|
|
648,500
|
|
|
|
1,330,000
|
|
|
|
168,100
|
|
|
|
355,000
|
|
|
|
-
|
|
|
|
-
|
|
|
|
523,100
|
|
|
|
447,000
|
|
|
|
359,900
|
Ireland
|
|
|
|
856,200
|
|
|
|
751,700
|
|
|
|
523,900
|
|
|
|
1,091,600
|
|
|
|
44,500
|
|
|
|
336,700
|
|
|
|
-
|
|
|
|
33,600
|
|
|
|
414,800
|
|
|
|
352,300
|
|
|
|
324,500
|
Total Western Europe
|
|
|
|
35,299,300
|
|
|
|
34,842,900
|
|
|
|
18,321,000
|
|
|
|
37,621,200
|
|
|
|
6,304,100
|
|
|
|
10,014,200
|
|
|
|
-
|
|
|
|
33,600
|
|
|
|
16,351,900
|
|
|
|
11,249,500
|
|
|
|
10,019,800
|
Poland
|
|
|
|
2,734,300
|
|
|
|
2,643,000
|
|
|
|
1,436,600
|
|
|
|
2,706,300
|
|
|
|
326,400
|
|
|
|
886,800
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,213,200
|
|
|
|
958,100
|
|
|
|
535,000
|
Hungary
|
|
|
|
1,545,300
|
|
|
|
1,529,800
|
|
|
|
1,059,700
|
|
|
|
1,911,200
|
|
|
|
240,300
|
|
|
|
395,700
|
|
|
|
269,200
|
|
|
|
-
|
|
|
|
905,200
|
|
|
|
535,300
|
|
|
|
470,700
|
Romania
|
|
|
|
2,301,800
|
|
|
|
2,136,000
|
|
|
|
1,158,100
|
|
|
|
1,862,300
|
|
|
|
329,300
|
|
|
|
514,800
|
|
|
|
306,600
|
|
|
|
-
|
|
|
|
1,150,700
|
|
|
|
406,700
|
|
|
|
304,900
|
Czech Republic
|
|
|
|
1,364,500
|
|
|
|
1,262,800
|
|
|
|
713,500
|
|
|
|
1,176,700
|
|
|
|
85,600
|
|
|
|
372,300
|
|
|
|
104,400
|
|
|
|
-
|
|
|
|
562,300
|
|
|
|
440,400
|
|
|
|
174,000
|
Slovakia
|
|
|
|
503,400
|
|
|
|
480,700
|
|
|
|
281,600
|
|
|
|
428,000
|
|
|
|
48,700
|
|
|
|
137,000
|
|
|
|
65,300
|
|
|
|
600
|
|
|
|
251,600
|
|
|
|
111,900
|
|
|
|
64,500
|
Total CEE
|
|
|
|
8,449,300
|
|
|
|
8,052,300
|
|
|
|
4,649,500
|
|
|
|
8,084,500
|
|
|
|
1,030,300
|
|
|
|
2,306,600
|
|
|
|
745,500
|
|
|
|
600
|
|
|
|
4,083,000
|
|
|
|
2,452,400
|
|
|
|
1,549,100
|
Total Europe
|
|
|
|
43,748,600
|
|
|
|
42,895,200
|
|
|
|
22,970,500
|
|
|
|
45,705,700
|
|
|
|
7,334,400
|
|
|
|
12,320,800
|
|
|
|
745,500
|
|
|
|
34,200
|
|
|
|
20,434,900
|
|
|
|
13,701,900
|
|
|
|
11,568,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chile
|
|
|
|
2,948,200
|
|
|
|
2,427,700
|
|
|
|
1,224,700
|
|
|
|
2,637,800
|
|
|
|
122,200
|
|
|
|
885,700
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,007,900
|
|
|
|
921,000
|
|
|
|
708,900
|
Puerto Rico
|
|
|
|
704,800
|
|
|
|
704,800
|
|
|
|
275,700
|
|
|
|
561,900
|
|
|
|
-
|
|
|
|
215,400
|
|
|
|
-
|
|
|
|
-
|
|
|
|
215,400
|
|
|
|
199,400
|
|
|
|
147,100
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Grand Total
|
|
|
|
47,401,600
|
|
|
|
46,027,700
|
|
|
|
24,470,900
|
|
|
|
48,905,400
|
|
|
|
7,456,600
|
|
|
|
13,421,900
|
|
|
|
745,500
|
|
|
|
34,200
|
|
|
|
21,658,200
|
|
|
|
14,822,300
|
|
|
|
12,424,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subscriber Variance Table - June 30, 2014 vs. March 31, 2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Video
|
|
|
|
|
|
|
|
|
|
|
|
|
Homes Passed(1)
|
|
|
Two-way Homes Passed(2)
|
|
|
Customer Relationships(3)
|
|
|
Total RGUs(4)
|
|
|
Analog Cable Subscribers(5)
|
|
|
Digital Cable Subscribers(6)
|
|
|
DTH Subscribers(7)
|
|
|
MMDS Subscribers(8)
|
|
|
Total Video
|
|
|
Internet Subscribers(9)
|
|
|
Telephony Subscribers(10)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
European Operations Division:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.K.
|
|
|
|
(32,300
|
)
|
|
|
(32,300
|
)
|
|
|
(16,800
|
)
|
|
|
(17,000
|
)
|
|
|
-
|
|
|
|
(14,900
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(14,900
|
)
|
|
|
(300
|
)
|
|
|
(1,800
|
)
|
Germany
|
|
|
|
18,800
|
|
|
|
10,400
|
|
|
|
18,000
|
|
|
|
123,900
|
|
|
|
(10,300
|
)
|
|
|
10,400
|
|
|
|
-
|
|
|
|
-
|
|
|
|
100
|
|
|
|
81,700
|
|
|
|
42,100
|
|
Belgium
|
|
|
|
5,600
|
|
|
|
5,600
|
|
|
|
(5,800
|
)
|
|
|
25,100
|
|
|
|
(25,000
|
)
|
|
|
19,200
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(5,800
|
)
|
|
|
12,000
|
|
|
|
18,900
|
|
The Netherlands(11)
|
|
|
|
2,900
|
|
|
|
3,300
|
|
|
|
(11,900
|
)
|
|
|
7,300
|
|
|
|
(17,800
|
)
|
|
|
5,900
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(11,900
|
)
|
|
|
13,400
|
|
|
|
5,800
|
|
Switzerland(11)
|
|
|
|
2,600
|
|
|
|
269,800
|
|
|
|
(4,800
|
)
|
|
|
21,700
|
|
|
|
(15,300
|
)
|
|
|
8,900
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(6,400
|
)
|
|
|
25,100
|
|
|
|
3,000
|
|
Austria
|
|
|
|
3,300
|
|
|
|
3,300
|
|
|
|
(2,100
|
)
|
|
|
9,200
|
|
|
|
(15,700
|
)
|
|
|
13,100
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(2,600
|
)
|
|
|
6,600
|
|
|
|
5,200
|
|
Ireland
|
|
|
|
(1,700
|
)
|
|
|
1,100
|
|
|
|
(6,700
|
)
|
|
|
7,600
|
|
|
|
(3,300
|
)
|
|
|
(2,300
|
)
|
|
|
-
|
|
|
|
(2,300
|
)
|
|
|
(7,900
|
)
|
|
|
4,000
|
|
|
|
11,500
|
|
Total Western Europe
|
|
|
|
(800
|
)
|
|
|
261,200
|
|
|
|
(30,100
|
)
|
|
|
177,800
|
|
|
|
(87,400
|
)
|
|
|
40,300
|
|
|
|
-
|
|
|
|
(2,300
|
)
|
|
|
(49,400
|
)
|
|
|
142,500
|
|
|
|
84,700
|
|
Poland
|
|
|
|
9,300
|
|
|
|
13,000
|
|
|
|
5,600
|
|
|
|
24,300
|
|
|
|
(26,900
|
)
|
|
|
18,600
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(8,300
|
)
|
|
|
24,600
|
|
|
|
8,000
|
|
Hungary
|
|
|
|
3,300
|
|
|
|
3,200
|
|
|
|
4,700
|
|
|
|
22,000
|
|
|
|
(6,000
|
)
|
|
|
7,700
|
|
|
|
2,400
|
|
|
|
-
|
|
|
|
4,100
|
|
|
|
7,100
|
|
|
|
10,800
|
|
Romania
|
|
|
|
20,600
|
|
|
|
39,100
|
|
|
|
(21,400
|
)
|
|
|
100
|
|
|
|
(21,100
|
)
|
|
|
21,700
|
|
|
|
(22,600
|
)
|
|
|
-
|
|
|
|
(22,000
|
)
|
|
|
11,700
|
|
|
|
10,400
|
|
Czech Republic
|
|
|
|
3,600
|
|
|
|
3,600
|
|
|
|
(4,500
|
)
|
|
|
(5,200
|
)
|
|
|
1,900
|
|
|
|
(3,900
|
)
|
|
|
1,400
|
|
|
|
-
|
|
|
|
(600
|
)
|
|
|
(600
|
)
|
|
|
(4,000
|
)
|
Slovakia
|
|
|
|
600
|
|
|
|
700
|
|
|
|
(2,400
|
)
|
|
|
(1,000
|
)
|
|
|
(5,900
|
)
|
|
|
3,100
|
|
|
|
(500
|
)
|
|
|
-
|
|
|
|
(3,300
|
)
|
|
|
1,200
|
|
|
|
1,100
|
|
Total CEE
|
|
|
|
37,400
|
|
|
|
59,600
|
|
|
|
(18,000
|
)
|
|
|
40,200
|
|
|
|
(58,000
|
)
|
|
|
47,200
|
|
|
|
(19,300
|
)
|
|
|
-
|
|
|
|
(30,100
|
)
|
|
|
44,000
|
|
|
|
26,300
|
|
Total Europe
|
|
|
|
36,600
|
|
|
|
320,800
|
|
|
|
(48,100
|
)
|
|
|
218,000
|
|
|
|
(145,400
|
)
|
|
|
87,500
|
|
|
|
(19,300
|
)
|
|
|
(2,300
|
)
|
|
|
(79,500
|
)
|
|
|
186,500
|
|
|
|
111,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Chile
|
|
|
|
15,000
|
|
|
|
15,400
|
|
|
|
14,400
|
|
|
|
41,200
|
|
|
|
(5,700
|
)
|
|
|
14,800
|
|
|
|
-
|
|
|
|
-
|
|
|
|
9,100
|
|
|
|
21,600
|
|
|
|
10,500
|
|
Puerto Rico
|
|
|
|
100
|
|
|
|
100
|
|
|
|
400
|
|
|
|
8,900
|
|
|
|
-
|
|
|
|
1,200
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,200
|
|
|
|
2,400
|
|
|
|
5,300
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Grand Total
|
|
|
|
51,700
|
|
|
|
336,300
|
|
|
|
(33,300
|
)
|
|
|
268,100
|
|
|
|
(151,100
|
)
|
|
|
103,500
|
|
|
|
(19,300
|
)
|
|
|
(2,300
|
)
|
|
|
(69,200
|
)
|
|
|
210,500
|
|
|
|
126,800
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic Change Summary:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe (excl. U.K., DE and BE)
|
|
|
|
42,700
|
|
|
|
72,500
|
|
|
|
(56,200
|
)
|
|
|
56,700
|
|
|
|
(110,700
|
)
|
|
|
71,000
|
|
|
|
(19,300
|
)
|
|
|
(2,300
|
)
|
|
|
(61,300
|
)
|
|
|
67,800
|
|
|
|
50,200
|
|
U.K.
|
|
|
|
12,000
|
|
|
|
12,000
|
|
|
|
(16,800
|
)
|
|
|
(17,000
|
)
|
|
|
-
|
|
|
|
(14,900
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
(14,900
|
)
|
|
|
(300
|
)
|
|
|
(1,800
|
)
|
Germany
|
|
|
|
18,800
|
|
|
|
10,400
|
|
|
|
18,000
|
|
|
|
123,900
|
|
|
|
(10,300
|
)
|
|
|
10,400
|
|
|
|
-
|
|
|
|
-
|
|
|
|
100
|
|
|
|
81,700
|
|
|
|
42,100
|
|
Belgium
|
|
|
|
5,600
|
|
|
|
5,600
|
|
|
|
(5,800
|
)
|
|
|
25,100
|
|
|
|
(25,000
|
)
|
|
|
19,200
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(5,800
|
)
|
|
|
12,000
|
|
|
|
18,900
|
|
Total Europe
|
|
|
|
79,100
|
|
|
|
100,500
|
|
|
|
(60,800
|
)
|
|
|
188,700
|
|
|
|
(146,000
|
)
|
|
|
85,700
|
|
|
|
(19,300
|
)
|
|
|
(2,300
|
)
|
|
|
(81,900
|
)
|
|
|
161,200
|
|
|
|
109,400
|
|
Chile
|
|
|
|
15,000
|
|
|
|
15,400
|
|
|
|
14,400
|
|
|
|
41,200
|
|
|
|
(5,700
|
)
|
|
|
14,800
|
|
|
|
-
|
|
|
|
-
|
|
|
|
9,100
|
|
|
|
21,600
|
|
|
|
10,500
|
|
Puerto Rico
|
|
|
|
100
|
|
|
|
100
|
|
|
|
400
|
|
|
|
8,900
|
|
|
|
-
|
|
|
|
1,200
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1,200
|
|
|
|
2,400
|
|
|
|
5,300
|
|
Total Organic Change
|
|
|
|
94,200
|
|
|
|
116,000
|
|
|
|
(46,000
|
)
|
|
|
238,800
|
|
|
|
(151,700
|
)
|
|
|
101,700
|
|
|
|
(19,300
|
)
|
|
|
(2,300
|
)
|
|
|
(71,600
|
)
|
|
|
185,200
|
|
|
|
125,200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q2 2014 Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition - Poland
|
|
|
|
1,800
|
|
|
|
1,800
|
|
|
|
12,700
|
|
|
|
16,400
|
|
|
|
600
|
|
|
|
1,800
|
|
|
|
-
|
|
|
|
-
|
|
|
|
2,400
|
|
|
|
12,400
|
|
|
|
1,600
|
|
U.K. adjustments
|
|
|
|
(44,300
|
)
|
|
|
(44,300
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
Switzerland adjustments
|
|
|
|
-
|
|
|
|
262,800
|
|
|
|
-
|
|
|
|
12,900
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
12,900
|
|
|
|
-
|
|
Net Adjustments
|
|
|
|
(42,500
|
)
|
|
|
220,300
|
|
|
|
12,700
|
|
|
|
29,300
|
|
|
|
600
|
|
|
|
1,800
|
|
|
|
-
|
|
|
|
-
|
|
|
|
2,400
|
|
|
|
25,300
|
|
|
|
1,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Adds (Reductions)
|
|
|
|
51,700
|
|
|
|
336,300
|
|
|
|
(33,300
|
)
|
|
|
268,100
|
|
|
|
(151,100
|
)
|
|
|
103,500
|
|
|
|
(19,300
|
)
|
|
|
(2,300
|
)
|
|
|
(69,200
|
)
|
|
|
210,500
|
|
|
|
126,800
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Footnotes for Operating Data and Subscriber Variance Tables
|
(1)
|
|
|
|
Homes Passed are homes, residential multiple dwelling units or
commercial units that can be connected to our networks without
materially extending the distribution plant, except for DTH and
Multi-channel Multipoint ("microwave") Distribution System ("MMDS")
homes. Our Homes Passed counts are based on census data that can
change based on either revisions to the data or from new census
results. We do not count homes passed for DTH. With respect to MMDS,
one MMDS customer is equal to one Home Passed. Due to the fact that
we do not own the partner networks (defined below) used in
Switzerland and the Netherlands (see note 11) we do not report homes
passed for Switzerland's and the Netherlands' partner networks.
|
(2)
|
|
|
|
Two-way Homes Passed are Homes Passed by those sections of our
networks that are technologically capable of providing two-way
services, including video, internet and telephony services.
|
(3)
|
|
|
|
Customer Relationships are the number of customers who receive at
least one of our video, internet or telephony services that we count
as Revenue Generating Units ("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 to Tables. 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 customers from Customer
Relationships. For Belgium, Customer Relationships only include
customers who subscribe to an analog or digital cable service due to
billing system limitations.
|
(4)
|
|
|
|
Revenue Generating Unit is separately an Analog Cable Subscriber,
Digital Cable Subscriber, DTH Subscriber, MMDS Subscriber, Internet
Subscriber or Telephony Subscriber. A home, residential multiple
dwelling unit, or commercial unit may contain one or more RGUs. For
example, if a residential customer in our Austrian system 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, DTH, MMDS, 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. Services offered without charge on a long-term basis (e.g.,
VIP subscribers, 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 June 30,
2014 RGU counts exclude our separately reported postpaid and prepaid
mobile subscribers in the U.K., Belgium, Germany, Chile, Poland,
Hungary, the Netherlands and Switzerland of 3,041,300, 820,800,
276,400, 89,700, 13,300, 9,300 and 2,500 and 500, respectively. Our
mobile subscriber count represents the number of active SIM cards in
service.
|
(5)
|
|
|
|
Analog Cable Subscriber is a home, residential multiple dwelling
unit or commercial unit that receives our analog cable service over
our broadband network. Our Analog Cable Subscriber counts also
include 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 not encrypted in certain portions of our
footprint and the use of purchased digital set-top boxes in Belgium.
In Europe, we have approximately 109,800 "lifeline" customers that
are counted on a per connection basis, representing the least
expensive regulated tier of video cable service, with only a few
channels.
|
(6)
|
|
|
|
Digital Cable Subscriber is a home, residential multiple dwelling
unit or commercial unit that receives our digital cable service over
our broadband network or through a partner 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 the respective Digital Cable Subscriber counts.
Subscribers to digital cable services provided by our operations in
Switzerland and the Netherlands over partner networks receive analog
cable services from the partner networks as opposed to our
operations.
|
(7)
|
|
|
|
DTH Subscriber is a home, residential multiple dwelling unit or
commercial unit that receives our video programming broadcast
directly via a geosynchronous satellite.
|
(8)
|
|
|
|
MMDS Subscriber is a home, residential multiple dwelling unit or
commercial unit that receives our video programming via MMDS.
|
(9)
|
|
|
|
Internet Subscriber is a home, residential multiple dwelling unit or
commercial unit that receives internet services over our networks,
or that we service through a partner network. Our Internet
Subscribers exclude 108,700 asymmetric digital subscriber line
("ADSL") subscribers within our U.K. segment and 69,800 digital
subscriber line ("DSL") subscribers within our Austria segment that
are not serviced over our networks. Our Internet Subscribers do not
include customers that receive services from dial-up connections. In
Switzerland, we offer a 2 Mbps internet service to our Analog and
Digital Cable Subscribers without an incremental recurring fee. Our
Internet Subscribers in Switzerland include 51,300 subscribers who
have requested and received a modem that enables the receipt of this
2 Mbps internet service.
|
(10)
|
|
|
|
Telephony Subscriber is a home, residential multiple dwelling unit
or commercial unit that receives voice services over our networks,
or that we service through a partner network. Telephony Subscribers
exclude mobile telephony subscribers. Our Telephony Subscribers
exclude 74,200 and 51,400 subscribers within our segments in the
U.K. and Austria, respectively, that are not serviced over our
networks.
|
(11)
|
|
|
|
Pursuant to service agreements, Switzerland and, to a much lesser
extent, the Netherlands offer digital cable, broadband internet and
telephony services over networks owned by third-party cable
operators ("partner networks"). A partner network RGU is only
recognized if there is a direct billing relationship with the
customer. At June 30, 2014, Switzerland's partner networks account
for 143,700 Customer Relationships, 282,200 RGUs, 111,700 Digital
Cable Subscribers, 100,800 Internet Subscribers, and 69,700
Telephony Subscribers.
|
|
|
|
|
|
Additional General Notes to Tables:
All of our broadband communications subsidiaries provide telephony,
broadband internet, data, video or other B2B services. Certain of our
B2B revenue is derived from small or home office ("SOHO") subscribers
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 SOHOs, whether or not accompanied by
enhanced service levels and/or premium prices, are included in the
respective RGU and customer counts of our broadband communications
operations, with only those services provided at premium prices
considered to be "SOHO RGUs" or "SOHO customers." 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.
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 and certain commercial and residential multiple dwelling units in
Europe (with the exception of Germany and Belgium, where we do not count
any RGUs on an EBU basis). 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. In Germany, homes
passed reflect the footprint and two-way homes passed reflect the
technological capability of our network 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 or success-based
basis. In Belgium, Telenet leases a portion of its network under a
long-term capital lease arrangement. These tables include operating
statistics for Telenet's owned and leased networks.
While we take appropriate steps to ensure that subscriber statistics are
presented on a consistent and accurate basis at any given balance sheet
date, the variability from country to country in (i) the nature and
pricing of products and services, (ii) the distribution platform, (iii)
billing systems, (iv) bad debt collection experience and (v) other
factors add complexity to the subscriber counting process. We
periodically review our subscriber counting policies and underlying
systems to improve the accuracy and consistency of the data reported on
a prospective basis. Accordingly, we may from time to time make
appropriate adjustments to our subscriber statistics based on those
reviews.
Subscriber information for acquired entities is preliminary and subject
to adjustment until we have completed our review of such information and
determined that it is presented in accordance with our policies.
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