Liberty Global lost 32,500 RGUs in the fourth quarter of 2018, with gains by Virgin Media and its continuing CEE operations more than offset by losses in Belgium and Switzerland.
Losses were most pronounced in the video sector, the 74,900 posted by the company in its latest set of results being over twice as much as the 31,600 loss in Q4 2017. Although there was a gain in data RGUs in Q4 2018 (+24,800), it was lower than the 42,700 posted a year earlier. Voice, on the other hand, moved from a loss of 7,400 to a gain of 17,600 over the same period. Meanwhile, revenues from continuing operations amounted to $2,949.1 million in Q4 2018, down 1.2% on the same period in 2017.
Losses were most keenly felt in Switzerland (-5.8% to $325.6 million) and continuing CEE operations (-5% to $119.1 million).
In the discontinued European operations revenues fell by year-on-year 10.3% to $894.7 million in Q4 2018. Operating cash flow in the remaining operations was $1,301.6 million in Q4 (+0.9%) and $554.1 million (-8.9%) in the discontinued ones. Liberty’s net earnings in Q4 amounted to $25.1 million, compared to a loss of $992 million a year earlier.
In his comments on the results, Liberty CEO Mike Fries said: “The past fourteen months have been transformational for Liberty Global. After two decades of buying, building and growing world-class cable operations in Europe, we have announced or completed transactions in six of our twelve markets at premium valuations. Together these deals represent an aggregate enterprise value of $31 billion and net cash proceeds to the company, when completed, of $16 long been our ambition to create or enable national champions, and we couldn’t be more proud of these fixed-mobile combinations, which will challenge incumbents, accelerate innovation and benefit customers for years to come.
“After these transactions, in addition to a strategic investment portfolio and over $2 billion in net tax assets, we will continue to be the largest cable operator in the U.K., Ireland, Belgium, Poland and Slovakia. Together our operations serve 23 million RGUs and generate $11 billion of annual revenue. We also serve another 10 million RGUs and generate over $4 billion of annual revenue in The Netherlands through our 50/50 JV with Vodafone. Each of these businesses is entering a new period of reduced capital intensity and meaningful operating free cash flow (“OFCF”) growth.
“Also, in connection with the changing scope of our business, we initiated a broader reorganisation plan in January, which will result in a leaner operating structure. As we move through the year, we will have further updates on this initiative”.
