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LBTYA Liberty Global

Participants
Mike Fries CEO
Charlie Bracken EVP and CFO
Tom Mockridge CEO, Virgin Media
Eric Tveter CEO, Liberty Global's Central Europe
James Ratcliffe Evercore ISI
Ulrich Rathe Jefferies
Daniel Morris Barclays Capital
Jeff Wlodarczak Pivotal Research Group
Jonathan Dann RBC Capital Markets
Ben Swinburne Morgan Stanley
James Ratzer New Street Research
Akhil Dattani JPMorgan
Carl Murdock-Smith Berenberg
Call transcript
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Operator

Good morning, ladies and gentlemen, and thank you for standing by. Welcome to Liberty Global's Second Quarter 2018 Investor Call. This call and the associated webcast are the property of Liberty Global, and any redistribution, retransmission, or rebroadcast of this call or webcast in any form without the expressed written consent of Liberty Global is strictly prohibited. At this time, all participants are in listen-only mode. Today's formal presentations can be found under the Investor Relations section of Liberty Global's Web site at www.libertyglobal.com. instructions given presentation, session. a formal today's will for be question-and-answer After

Global's to including XX-K as historical prospects expectations to filed slides Safe a in facts. cause any is Today's meaning in expressed any statements. XXXX. forward-looking Private that its August the implied turn any call outlook differ of this presentation to Page the recorded Litigation and risks Act these update to of Reform these respect As the statements its statements investor Forms from Securities of XX-Q date, statements is involve Global may being include statements reminder, within of forward-looking Statement Securities Harbor forward-looking regarding actual Liberty call and by or future on These statement XXXX, such forward-looking this those two and conditions Exchange with and change reflect now most filings the the details in recently Fries. statements. I Commission, over growth include disclaims company's materially based. the Liberty certain with are could information including obligation not like any the company's that other Mike and amended. risks results would to These or those expectations detailed on to Mr. its which X,

Mike Fries

our And to welcome second Operator. you, everyone investor thank quarter Okay, call.

Q&A questions be get that. of And senior and engaged Charlie your on can performance, during management you through have. whatever rest slide you the and get answering usual, the deck summarizing As and operating the that our sure financial I in Bracken the run I'll may will hands team to follows, then hope

operations, results presentation strategically. for lay people involving upfront, showing the and our OCF, we from notice growth figures you'll So negatively company, businesses full similar results. quarter X% markets which will some And with and from throughout impacted nearly only of we to X% the revenue sale both background operationally used company. on for you're flow financial the around seeing, operating announced a track. cash main OCF some around Vodafone on at businesses or along year, to where for takeaways the and of most the our in plenty begin in operations, by cover on operating to one-offs for the sold. focused we the X% transaction and slide that continuing XX.X quick Charlie which excludes billion, now approval. on what One call footnote regulatory is Both with closing European are full $XX course prior deal that will times in both generate is believe with surprisingly, what four, growth cases Not condition growth right perspective in that was continuing out and smaller and we're And strong of quarter, our I'll Germany the for Eastern the have what we right be were

obstacles we meetings from commissions fixed course, Austrian T-Mobile, mobile the approval, just or decided This seven the with a will transaction our the seen to with confident merger, As would've in commission deal which place. are business, we and and authority the stage was week will soon. cleared that a signing this that with you approval, not times would billion In several of by And months do formal $X.X also way, the Phase on you see of the we expect, roughly the XX that sale have flow. the be for completion. the mid-XXXX. operating last expect in meantime, filing X Brussels closed cash a this at EU, close And taken the competition by any

net $XXX program, our supplements $X and Media, proceeds back billion allocate months. million own continues the XX we the time that and that over announced of any half Austria last to be As after debt about we repayment our were week, of stock, billion, strong Operationally, results. can repurchase share Virgin $X.X buying that attributed and largest business, our next deliver we'll to used to

right I'm adds. and as couldn't is and on and executive the of Schüler, delivered talent, focused particularly that best detail needless speaking we've for growth to I'm Virgin team course of business In talent of he's excited staying German to of executives the our to excited He'll to Lutz already a more of Chief executive of hit in seasoned telecom QX next few X% in what Lutz family. video team, sectors, become was and quite that Enrique overseeing in new businesses. optimize to driver operating be a was Officer over the which who Tveter moments, bring a and ground strongest an all of Operating evolve Eric that our made broadband, in the and rest generated recently and happier growth seen one our competitive eight we She's ever, who marketing which years, Chairman net done a our month. Media our value for will CEO CEO appointment last position. be to focus level been and search, are to joining worked continue the of announced exactly say, on past outstanding we the investment our digital, with significant is across that And CPE operating energy Severina announce a our whole try our business, off. to then we capital years, it Pascu largest of the is operation most us this a Germany. spend. consistent geographies and Eastern of I Swiss right He's fact number she now. platform, hardware and and the us. over upgrades, before, paying team. operationally. I'll running great CTO revenue Severina we XXX,XXX but provide a bring Eric ensuring who's XX leadership our and are media Rodriguez going sure After you've Enrique also will arguably and for remaining market execute need also the now announcements with And fresh well European perspective the key has are in as I'm software is

the Charlie will walk guidance our those continuing and our confirming are for full numbers we operations, and Lastly, full-year targets company a moment. through in both today

we're happy So with overall. the quarter

with are the Virgin with leading That's continues first moment. net I'll another the from year. M&A the growth, confirming engine market, upped deals which track. the talk be with operating slide With subscriber this the prior about in adds business. XX,XXX solid XXX,XXX starting at subscriber the group. was Our XXX,XXX on guidance. delivered a our second Across on and Switzerland that, business up And we're updates, tough by performer, jump and strong period, quarter five, The in Media as in We've I'll Virgin into operating buyback. way, for some at results, broadband net quarter, experiencing to growth best of far adds, and quarter markets in though Media that our all varied by

XXX by from anything heard time anchored customers a is months, but You've with our added at in the making by and long our in services course, average broadband theme already roadmap, speed per that net XX% the XXX over with XXX,XXX of XX the speed progress in us higher. Today, than our launched more telcos. XX subs new Germany. of advantage our We've for or And megabits bundles triple we're now. last broadband million propelled quad-play second, meg gigabit across base relative great

we're Wi-Fi changer over speed and and customers Now and Wi-Fi game ecosystem in a us, in rollout as of for for and with rolling speak. as This meaningful out home. fast XX% benefit sales, our our MPS has addition our and churn, seeing been we Box, boosters powerful Wi-Fi Connect using a to our app we the broadband broadband

the the was see that losses in Now, quarters. four chart, on and in XX,XXX, were result bottom-left of best the you'll quarter our video that

think discussed out pointing U.S. the we've the doesn't market many face TV and pay it's worth pressure the European as again, As times, of competitive I intensity same

markets base, are audience by prices costs, characterized retail broadly inconsistent and TV programming Our for lower lower large linear penetration. video, OTT a

bundles, In box, subs. with integration, gained we footprint expansion, a of Media, a video just go-apps, working box. our success ecosystem UI. we're XK and doing with content three-play And a new the VX video sophisticated and one common towards broadband, of as fact, we're as result cloud-based OTT Virgin XX,XXX

quarter, a revenue And core particularly BXB, which about us, point one again Switzerland. double-digit SOHO that and in growth the opportunity was the in that's share growth. continue to Now in slide an straight for XX% with U.K. and market, revenue this see to last grow continues to generate and fifth we driver,

I've as quarter sure more detailed and another look be a operationally to at want provide which, delivered Media Now, we said usual, to financially. Virgin as strong

but As you'll the quarters see XXX,XXX on U.K., actually by fueled prior materially in and best added adds few net quarter net from RGUs. our new the were campaign, triple-play ever the QX lots attractive which total XXX,XXX, and drivers XX-month a slide of at XXX new you TV bundles ad successive work offers, meg, reduced and of our third quarter churn. imagine, as were new including here, There would XXX at six,

of And in footprint, a and second which reflecting RGU the as our net straight retention Wi-Fi period. the XX% which pickup about VX ARPU for base disciplined of and Hub year, X better of as also just and better acquisition all adds through approach we've set-top X.X% execution existing the our talked last more growth in rise, grew in as to price importantly, like We routers. management our discounts, well non-Lightning programs about our saw represented quarter,

attractive in you'll of slide focus U.K. to over relatively reflects the XXX,XXX stable, on RGUs. deliver connected latest X.X continued now built cost-effective Lightning Ireland, On million the We've premises at volume right-hand construction and continues and opportunities. see update which XXX,XXX was and QX Project a premises, growth new the and six XXX,XXX representing returns. build customers, side, on

planning MDUs, new it's reduce legislation and should network in give I out U.K. providers us our together rights, broadband with build allowing help pointing worth premise forward. access that costs more commitments will going the better improved to target which for think

as construction cost, the we've side that. box the build, with of on see And typical our highlighted you'll chart. vary rates right-hand why type which is On of with bottom-right, the penetration penetration just the

indicated technical are we've our low-cost are XXXX along, a all upgrades, that penetrate. higher volume of homes and to those generally cohorts As included harder

out strip here technical the impact the been look lower. for territories numbers be for in XX%. would So if result, reported bit we've years penetration marketing a XX-month as over you those And our of a upgrades, fact three

So Project cost back as we margin, and we stand for per and attractive see we Lightning, namely to our premise, and metrics returns, key this continue pace. general like penetration, consider ARPU,

before as well briefly Switzerland, hand continuing Now I'll it Charlie, as to with our I base over operations, Vodafone. on our with and JV you Belgium touch Dutch

we've teams And you and through grow used these and be cash the managing can see the these form facing free before, or environment business is companies deliver operating significant can in results, either strong each got both in are businesses or revenue As of reasonably fixed, each that which competitive the some each who country in and highlighted flow, And mobile to capital of current generates services, subscriber returns. but of well. we've pressure both.

to Belgium, let we've base. penetration seven. the now significant most of one some advanced product, It's can with we're run our broadband including WIGO, the possible. slide start me the and subscribers of regulatory in in market to in and another before, mobile MVNO whenever left mobile fourth revenue sort And where most MNO relatively despite fixed rolled politicized the and XX% over is on commission them a This or flat they the back reaches that across called But customers for quarter the XX% of RGU with and mobile advanced afoul of migration It's out our we're and highly market, MPS. our growth doing adds, FMC in and everything great also potential and of environment, the we've particular the generates ensure as Belgium, pressure So operator. standards, ARPU XXX,XXX or we don't X% accountable synergies, EU wholesale converged of OCF access our discussed which platform. customers Telenet the over definitions holds and of headwinds generated new facing fixed

the business will of for course strong Liberty which benefit flow the an In million proportionately. cash in supports declare dividend recent fact, exceptional the outlook of decision to €XXX

Switzerland, environment I to think tough times. of a pretty many we currently the in midst discussed we competitive Moving are there,

of of A During the of now on quarter, two-thirds best-in-class right about the our improving user lost our were is next-gen interface well video. product for as upcoming we and TV platform launch focus the EOS XX,XXX the which RGUs, us DVR. big and cloud-based part as with

am said taking excited has great over the that with will CEO here. role a earlier, I As be I had track Severina record us. She

attractive ARPU fact COO, continues us current extremely OFCF class obviously And strategic as and consolidate optionality well that's and for drive in our help she a cash and news. highlights Switzerland best good view. UPC both In the Happy as to of oversaw which market in And which as with WiFi It's some business with our rationalize our Home price And a quick rise you'll generative campaign important sport lastly, recent improvement experience be see as modest to also looks update a provides to in VodafoneZiggo. margins. on remember that highly at channel.

Our venture the in XX:XX joint Netherlands.

of having the of a JV name customers here convergence. here, other the us. nearly with highlights from enhanced mobile XX% bit is of the of again. broadband broadband branded two-thirds taking success is a game taking subs subscription Vodafone customers and video broadband quite Belgium, Few or like or spots we subs Just product fixed mobile And bright adding are and nearly postpaid

abate on base. we customer And the able the been of business the on regulatory some year. take fixed increases to headwinds should mobile see reasonable second price in have half the We

As range. obviously. cash which flow us with to of Switzerland, total the cash Belgium of distributions the significant upper million JV Half €XXX €XXX and expect generates continues end and million at the to accrues to

The recently the Number announced have make larger and highly So the us one, the wrapping are value with demonstrate to they have the up landscape, just is and quick cable and a total By remarks, will deals Deutsche shareholders, always $X.XX Vodafone, way, operating been M&A here. three to has cash here. make which accretive. allow businesses I transaction my to of the our us Telekom JV, we sale Austria they all in and $X.XX of consolidating reposition flow. create for done points sense sale our for European premium goal value and Dutch

Media will continues as see recent consistent Secondly, we OCF the I forward. in operating our cash moving improvement corporations. am lastly, And And profile revenue largest operation and Virgin we management about an free generate then our growth. excited changes flow optimize the CapEx in

We execution of putting to growth initiatives. strategic also the right support positions in people the course, our right but firstly, are

So Charlie, over to you.

Charlie Bracken

I on start with Thanks QX results Mike everyone. financial will an of and overview hello X. Slide our XXXX

more Republic, continuing OCF full revenue X.X% include those company. reducing were we on a the for indirect by growth were able for record the present operations for results to X.X% company. regenerate both billion Romania, $X our moment. the results reiterate, to Media our rebased By I continuing the continuing growth consolidation address of strong for year-over-year, QX And the of $X discontinued Virgin to we rebased operations $X.X growth of or We in and rebased delivered company. the and growth billion OCF billion Telenet, largely billion These growth of in and and for to and $X.X X.X% Here will which revenue X.X% shaped full Czech of cost of of company Hungary, full our operations later. Germany, results our full and operations to the transactions

and now And XX.X% or of of we spent slide, revenue billion were continuing additions flow operations XX.X% the we three bottom $X.X QX full of different to free present company adjusted X.X revenue. billion moving which While the represented basis. P&E left on the cash

Now basis, operations in negative first continuing reported $XXX flow on QX. our cash purely million of a free had adjusted

a flow per reported that operations XXXX. completed continuing disposals supplement free view we aforementioned adjusted on assumes are that of the which January with Second, X, figure from forma cash being

flow we revenue for of But the guidance company from free and to due leverage this allocated On amount Net of QX free annualized from full down free X.Xx consistent respective activities higher largely basis, operations UPC growth higher that's concentrated finally, reported or discontinued agreements value also related buybacks this incorporates XXXX OCF. million. end flow, OCF inter the continuing forma QX estimated current the the impact the which the the not our And is the was for basis we financials. of cash the continuing of operations partial adjusts million. our on compliant than our debt would basis. our XX flow year From cash OCF And I financing figure at free our not of ratios this stood was debt while to cost reflect repayment for purposes. that estimate quarter. Xx the highlight to results then at adjusted in stood of operations. X%. this fully from the And This per vendor At our million specifically our positive a calculate debt. XXXX cash adjusted of the our the And does then $XX And over use transition negative of from these debt last service results on basis business now for full blended of generate to of an XXXX, the leverage flow that estimate with the our we free with was share company mainly negative our adjusted $XX ratio over operations full continuing of And our in a part June our Germany. continuing price a capital. our which $XXX company both of cash contribution methodology to cash net was impact for is due our are of coming Both used quarter meaningful leverage operations expect the the at was attractive full-year in reported That's from to the As slide, XXth, largely flow phasing is beyond. finally impacts. net down gross as X.Xx of we year-on-year consolidated seven ratios our underlying net last at we average months. believe that are company very guidance present full reflect adjusted not perspective, XX% tenure exceeded mainly a the our levels billion. XXXX, and debt $X.X on years borrowing swapped our debt to covenant these our until for result

$XXX nearly this of this the supporting as leaving our we $XXX $XXX repurchased million remainder year-to-date And Now, million to in previous program. for the stock repurchases billion million $X.X our QX conviction, of compared quarter. in takes to this

and additional an committed $XXX of sale million UPC next buybacks XX we've the from Additionally, over earlier, months. Mike as stated the from Austria

XX, and OCF revenue rebased to we continuing our operations. Turning present slide for

growth have QX our from the unfavorably project price revenue line by margin Media contribution revenue strong a certain lower growth which also a material acceleration. regulatory meaningful supported was respectively. X.X% sales. were Virgin on increasingly negative mobile in to XXXX items. Belgium. was Our able OCF in OCF delivered sales as addition network net by was and would QX of and decision from OCF a represent rebased another this and successive revenue Belgium, further lower future the charge and most supported settlements. million annual headwinds $XX revenue stream, to growth of cable driven rise. revenue year-over-year we're however as been to Telenet's impacted handset Top year-over-year demonstrate we an impacted in And impact lining basis largest of of losses, rise mobile was well by by again In operation, by Virgin price and quarter growth fourth these although was the X.X% The seeing of by delay Media our rebased customer declined impact mobile impact, revenues, to quarter exclude X% If

regulatory should through rebased headwinds are of to rise QX these QX. takes the as the OCF in with and and in Telenet's dissipate However, synergies the also begin price X% impacts driver start effect come Base growth main XXXX starting lapping. of of to

to Moving Switzerland, in challenging the market. X.X% revenue declined our

anniversary increases With customer distribution by the losses and the rebased in in past will of effect cost revenue, months over was MySports XX% in when the one-year QX launch OCF begin of the fees, XXXX for mobile the MySports. lap of the competitive contraction MySports QX These from BXB services Switzerland impacted the pass we XX and to offsetting pressures platform. of the costs of revenue

of our flat more expenses additions offset approximately slide posted whereby for equity in was at principally cash a was reassessment And X.X% net we bonuses. color the senior second due a on rebased in This this The Poland modest our employees our continuing costs On to segment additional in of the an XX, a CEE can quarter to QX provide as our business. contingency. structure in by XX% growth by on Our was DTH lieu attributable basis. in elect receive remuneration CEE for P&E for reduced the in largely operations. revenues segment, operational accrual decline decline of change to were OCF

investments the build upgrade CPE there & in customer Now five main we've as capacity are New commencement baseline. you and this has know, new of Build network that's and capital and in intensity ramped grouped of our our Enablers, and most since program XXXX. And experience. addition to in of categories And would back significant Product spend

initiatives, of large Media has within upgrade mobile and BX completed. the number project is the mobile and a these transformation Belgium modernization of the Virgin which since However, the scale network

also this characterize premises the and for compared XX.X% is as XXXX comparative Mike to of intensity. therefore This to slightly would period showing be for build QX is we so shows XX, sales would a expect as mix XX.X% 'XX CapEx phasing, capital capital is in the to in to the be more which And the no XXXX. lower And the ratio change of volume the of partly year XXXX due peak chart, by first the trend half as to With to we different. than the evidenced which second in half. lightning intensive Half of regards Two, tends the And described year earlier.

So reiterating intensity to not continuing result P&E as year. we're operations. in billion $X a reflects are XXXX of compared a our specific around this position XXXX, guidance still reductions But We're to for additions capital but provide a reduction guidance as yet in targeting next for XXXX. further we

believe capital. uses continue is four build achieved that new and relation for by upgrade build to in total new in sense. over we will However, this we The will drive returns CapEx the build stands build amongst part other be make the at number continue our central sized operations. approximately that the that categories XX% is And to And for time excluding the continuing extent lower. the to to ensuring year-to-date. expect And this our appropriately to we of

the XXXX. Swiss we market, reported record in strategic kicking even the build both sets remain turn customers' page. additional are to things to it the confirm our summary, from successfully And options. Two. invest that, base QX of Media our and months we committing this to continue while Half $XXX we delivered Austrian full-year of over Operator, $X to the questions. buyback deliver Despite expect additions growth while in billion stronger in synergies solid OCF to for our experience also we'd And new Virgin while moving integration the considering both and lead able to also challenging we existing next we're So with conclusion on XX Telenet's our nature target completed are The wrap shown in sale our up, footprints. accelerated to like to committed growth million Having by of results as RGU we've program an we've guidance finally, original slide into over business, with

Operator

session we'll [Operator to Instructions] for will with And to go Thank opportunity first Evercore. moment an just Jayant queue. join pause to you. The electronically. question-and-answer conducted everyone be give a the We'll Vijay

James Ratcliffe

any and James the how Ratcliffe loss Ratcliffe particularly of any the morning, in could; drove first strong economics Two carrying in in the voice not dispute was OpEx ongoing if you're with James associated quarter. for not U.K. what update sub the U.K. for about savings about talk services the very Good has. color is of Vijay. can approaching content Vijay. around that this what impact on over us what having you and I that all, are this and you with thanks? it's general talk UKTV Can voice secondly, And the around at and point,

Mike Fries

to minimal. tell say as subscribers dispute about here. impact pretty Clearly, sure speak. we're of Hi, think of going be those negotiation. there and savings. will Tom sort And But much we overpriced And James, we was in in chime we the been specific has UKTV an the you would the we're being midst got and Robert too. on since that ongoing conversations on not I'll without the Clearly, ask that's content I to them I'm

that? voice, or Robert of yes. terms in deal Tom, want you In basically Margins to with that are [indiscernible] product,

Tom Mockridge

chip will I in Yes, there.

quad a we can seen is numbers things into of seeing have there. effort made triple the to back play. And concerted particularly, play a as and I what where the think go I we think we through couple are is

customers course telephony of part more and gone of have we that bundle. the complete for is the a So

XXst fact assisted Virgin So segment we we a growing or by the very that the call of are voiceover significant being cable that the in Media But Voice business as has consciously. we're much quite in often it now couldn't landline. telephony home is we customers didn't we areas. found lightning significant that digital sell in Lightning marketplace, a When because all which want particularly, that have we at difference, available the still product, Century making

landline And course And telephony so up usage moderate business. And revenue. margin, declining are we're growing that the it's whilst the seeing segment of we're of a at decline. we the home picking

there's stream us still So in telephony. very a home for revenue significant

James Ratcliffe

you. thank Great,

Operator

now move Jefferies. Rathe with Ulrich We'll to

Ulrich Rathe

Thank strategic also to is one to the Switzerland But to the you. are Switzerland; telephony intake. the there I'm mentioned and year-on-year. actually in was wondering back U.K., in coming MySports? high questions, flat you there Second high blocks organically back was the the beyond quarter-on-quarter growth question, intake what video intake; optionality broadband Two was building intake

is strong on is XQ level that the anything So MDU quarter suggest or sort I overall an very broadband going this wondering was intake is of settled Thank within unusual you. intake? on down now broadband there very, at this would

Mike Fries

are out, which of doesn't making getting think rolled one state-of-the-art happen we've video can have a Tom, these it overnight, broadband before, thing. rationalization platform particular and box The impact, has the is remember here. Switzerland, in turnaround plan probably much requesting, is not that's pretty That's and or things, lest positions to again, video in that to you say, we the and business strong is on stable, the going driver main not make of not getting It some the growing service. remarks about EOS But that's people we're a Holland. difference plan to the Yes, video driver. multiple getting they're function will Severina continue are MySports I've an you Needless made in that reliable, say Romania number is And going question for been but impact, this. In leadership an and the I stable takes past. to have many listen, Switzerland. sure for in regard. years. a bid new the main team, guys platform the what the which

number reaching great market Mobile and solid. a the dent, largest We business the the people. BXB fastest broadband is of is the making have in it's a product;

about back So that as video getting perspective, our much market. in it's track, -- of the is a product that really, product from and competitive of quality importantly most as on function anything

would around. business we're in observation. opportunities think Tom, observer we'll rationalization can fulcrum we're market focused you so consolidation, you see want But arise done. the then broadband we've the the same turning talk process. end that any U.K.? organically to on there, and sort some about The does what give require asset the of in what And we controlled the On get fundamentally front, I the the and

Tom Mockridge

the It operators Mike. as we're Yes, thanks, I and quality market of on haven't might issue to the have. the down that other high doesn't that bottom there's flipside of there, U.K. mean we the focused think, broadband extent the our Look, gone pursuit that. to ARPU triples, is of on

do the bit and we If Sky you of Very the on low we chase. other other at did low end good overall speed. forward to We additions two by with implemented product cheaply our number. the the focused broadband driving the broadband of BT, that that. new been -- more of in. activity easy you going out the to this past, been are been getting market our ability these experience churn see see a by revenue is the have major, in want at U.K. below lower a the look but have quality assisted certainly In end there's of ourselves in ARPU the be to And can our coming so sell this rules right operators some the business fair up a at and around ARPU, each as we tended to has U.K. transitional, and our of market, being

network other the BT availability All itself limited we due network. out operators offer XX, a high-quality and router, meg. speed network XXX, the say great we the the now it can on of has are that say top XXX that have only we that BT and actually at can for across and meg and stuck can to we XXX go there have still So

marketing network, rule speed you against at can to unless the a it of you more a offer puts us those much, your least of position much half So which advantageous prevents competitors. new course in

better ARPU off it to end. got cheaper think doing So down deliberately broadband some target customers, the we're fed always pick option fundamentally when up market ones. lower not the the we and I at very just we've on is But dive being full that and

Ulrich Rathe

for both comment, thank much Thanks you. very

Operator

Daniel from next hear We'll Barclays' Morris.

Daniel Morris

for Thanks taking morning. question. Good the

around little question thinking some the if can U.K. Lightning a wondered And we in changed another your talk more you what's cost. clearly run I rate bit Just on disciple demonstrates XH, just the the in about the around around U.K. saw the alluded And the very Lightning much to Lightning is shifts, you in be Thank again trends and how that, the regulation build would reason things on any remarks? you. as to might opening as there XH? related change to XH different

Mike Fries

the And I by want to driven, importantly, ensuring just this we most in that we optimizing returns faster. capital pace be. of at cost that where it's remarks, could my like We and Yes, said think build we're the them as I stay now. kind building

team today premise lowest steady we're Tom penetrating market. going the of is attacking But driving I up. and most attractive think that's we sit could the easily where the think continue. pace, that per and and areas cost and ramp the ensures one from I And this a to

giving probably would my no But like Lightning, that we and remarks, push anything that. I guidance you on in we're increase And we that that really pace. the So know materially. headwinds slow as don't would this pace not said pace to down see us

the lower as just is us think we strategies. to premise markets and referenced as going opportunity aggressively. as gives commitments smarter to going build trend at And those an be penetrate more the our we MDUs, about per I cost legislation get we own look forward

significant It's she the I EBITDA. of driving So a as use us. a capital and It's goes, change other. or material steady for it's I don't it's driving think see one growth, way driving it's returns, great

see don't we that So changing.

Daniel Morris

you. Thank

Operator

Research with We'll Group. Pivotal to move now Jeff Wlodarczak

Jeff Wlodarczak

that confirm, Salt what's for overlap to municipalities. And got being to about can of of materially related, from Salt's result you the I've guys Good these was wanted then just days How Salt more triple-quad-play by morning. competitive. Switzerland. far then And follow-up follow-up. as aggressively RGU FTTH footprint I the with And tell, outlook one XQ It's as offer? your much a is then more on wholesaling priced directly gotten to rollout that obviously XX%. able expand lot to

Mike Fries

and of Eric triple-play here impact or minimal. the don't would if I rollout We or in the rollout Severina. know quad-play say, say was would Yes, Salt I is on he that can chime

call, it would is everybody reach. they earnings doesn't that aggressive in on? are an have clearly thing Sever have It's much asked. the Eric, market think say same operators if impact. had product, in Other roughly you their second material question? -- want I same that are much they an I've appear else And know, of it had they cheaper they than the But footprint not market. to thing to the few impact. probably have saying if take the the twice the roughly to in the we're same You you thing; weeks, say last talked seeing the

Eric Tveter

mentioned, platform, Mike MySports planning their side. this base starts ARPU. to the seen am. Also, of we early ARPU year, I the the in management And improvements And believe new launch EOS Yes, September. have then impact in which modestly efforts, said, we're Charlie we as we've earlier moment. year said, Mike as in will grew good through trends reverse the allow the stabilized season quarter. to us rollout And I limited as at which Again, our on that the a

product. the optimistic TV we'll that with coming I'm in to new the So launch able of the months be battle

Jeff Wlodarczak

Mike, with to or the transaction? what so then, latest billion your you're the just expected do billion to from on wanted you plan thoughts $XX VoD get $XX to or receive And

Mike Fries

adding thanks is which a in it's off. quite past, of we're a Yes, I Jeff. mean lot color to whole the said not what we've ways

prematurely say trying be or the a other. one though. a we're to of direction showing can so way we're couple And things sure I not

think in past, I done in that's what at we'll indicator good probably you what do a look the of the future. we've pretty if

over buyback; XX, think our or putting capital back years, acquisitions. We're into find putting If you XX we've either into last consistent. pretty we're five, go even you'll I the that been our capital

about In fact XX-XX. it's

had numbers -- based kind are what we we up, of those that with acquisitions. If returns generating XX-XX, and stock, have do returns, on about of and we returns kind our are just called you we on what generating

which to I we equity. probably can I expertise if this, work, I in get be can into way preoccupation back shoes with I We you'd where be we'll be, we're try off. other our rates transactions Germany, and take market the with €X valuation interest operations M&A quite the do technical some we'll hand, And a knowledge, don't it's our if the focused track our side, will were is be reduce and billion that stock likely just see And will don't those can there's more do turn where €XX to we'll to could like I On find keep billion, opportunities on buying to will be. stock we But be, do put ways if finding and it like operating on or shouldn't surprising. it's where think If our opportunities the think It's we it. said, see that. trading deals, like multiples deals what our where going things be, or understand record, where know open. looking where market say a we'll we totally that. we where options

not -- looks think, And I do the but outset what said going past. here, change here, to point. our And the I the probably just lot -- we've what going stripes done we're guys. a I that's has as forward going we're think So like to lot in main we'll a at

Jeff Wlodarczak

Great. Thanks, Mike.

Operator

We'll move now Jonathan to Dann with RBC.

Jonathan Dann

questions Two if I there. Hi could.

just, And is you of any in in or Charlie, there sort the swing in could drag financing first, Project of much is the how are the material in you'd vendor in secondly, to just been that second-half? change then the first-half incurred The added U.K. Lightning, Ireland? the positively rates on homes expect the that's most

Mike Fries

Charlie?

Charlie Bracken

back of and first-half second-half. year, then it's very typically as financing, us up know, the at the the in the it vendor backend back for vendor the probably unwinding the financing of you the cyclical. on pulled at of last Yes, year we're -- we In end

I financing in think of low see millions in vendor hundreds should year-on-year. the you net-net increase a our net

see on you'll swing on think And that's based I track pretty much the at a significant second-half. today. in what So we're looking reasonably

Mike Fries

can and the is in respond build but or that. relatively small, Yes, new to Ireland Tom Robert

Tom Mockridge

to there. governments local just but small asking have we a we essentially because begun tail for Ireland relatively there. to the it's the little But in bit so have didn't we authority had pay, compared fees rate of course I'll tailed off we bit of a U.K., us moderated wish have we that build add to off

So if business business, cable in and around going very which both Ireland the out you our mention Ireland we performance are business of the would point strong both TVX well.

Jonathan Dann

Excellent. Thank you.

Operator

hear Swinburne. We'll Stanley's Ben from now Morgan

Ben Swinburne

Hey, good morning guys.

ITV Mike, a Virgin's businesses, And offerings at sized of particularly more offensive in this to of differentiate are ITV months, in the are mobile you there; and either kind your businesses or or I fundamentally think Europe, on of under growth expectation Virgin. the decent and to Tom XX-XX just U.K. for those rates a just towards U.K.? part those regime the BXB maybe team, BXB the is re-trans or service the BXB to because as the at the of piece the kind U.K. obviously look as the revenues do ability Mike digits. deal, then flattish, is single and of next follow-up hood step in What's sort a sort For this you looking on accelerate low mobile view partnership with one the different

Mike Fries

-- them. done the financially, what and believe the on our neither about we've gives very let not the repeat cooperative of Fundamentally I is ITV had we same. with it them transaction we've the either to We BXB mobile us and they've I'll content. access We're us developed publicaly, It's really which a the a said quickly relationship of more we've of with we've address speaking I'll work Well, of but then just think deal us question; question. are done the with Tom more position is will we one. on re-trans, the them issue reserved rights, positive terms

I pleased position. with say, the we And can know, more course important were ITV content, outcome, of both the and we ability of jams trending in rights, answer to we're you HD, on XK, I our in you all access reserved linear strong not to think believe feel we to was guess do it relationship. if to towards I position a we that. had very U.K. think I have market their all But content And we've and that want So has the traffic for SD all an the and parties. like and directly, achieved and is it's what get

helpful. mobile? So, do that's Tom, in helps; want hope talk to BXB that you about

Tom Mockridge

expanded and Yes, by a who been very growth both Kelly a has that earner its Peter see leads thanks in product in BXB has discipline Liberty business consistently capital Samsung It's for and continuing Mark. business. areas, the strong well-supported been Virgin knowledge. on Group in BXB Media and continued the it. focus we and Soho on

able was of they have record the that think I business. think by time to a to there track integrated small key being two are acquire I the we the into within well paying Wi-Fi, years businesses on which are it back that

businesses market, there that So BT, a But of as growth looking supplies. for own continued different so at alternative and basically where advantage the operators a competition broader area. and not in of that being are have in we area their is expenses, see course are looking we

operators. the yes, business, bigger service than mobile I the some and had we pressure, think less probably On revenue look, have

transitioning entirely working prepay. business out and to I think business a that we are contract

a increase fact mobile but of We good again picked getting this have handset our a in have effective business increasingly is in on been solid has element all stack, up a business FMC, and contributor, also moved sell of so the element service on their operations significant yes, our big margin, and part we we're and which part that. people also IT ongoing service And quarter. better of profit a the to better that of and with the significant handsets, revenue,

Ireland. combination contributor to do overall, the both to Media we be U.K. continuing So see a that are good in Virgin in and

Ben Swinburne

you, Thank guys. it. Got

Operator

We will move Street Research. now New to with James Ratzer

James Ratzer

please. questions very indeed. you thank Yes, have two I much got

I reacted does in German disagreements, kind kind up future a that of on at way the pace three mean, of and that comfortable tact, build taking still seen I footsteps of has second you. mean looks long-term given are negative still you in if did quite of to you've following would mentioned be the opinion First the I ahead affect with the six that's buyback your project? to and just company thoughts in thinking a or private million have the your should responded you mean one, last so, on just it then build consider rate in given that target like years lightning, so, view by on around another positive you question the months X And kind level? different transaction the mean XX% you reflecting Musk's we quarter, Thank or M&A taken have that. you stock this the market that Elon I consider Does general, I of strategy on so. remain way that of you I mean investors, past

Mike Fries

I'm going appreciate take Yes, try. not Well, question. I will on to that. bate I the first

over been allocating managing I think XX or last don't a capital our I approach in the going XX to M&A materially and our forward. to approach years. buyback or us has to different pretty see consistent operating way

other business believed are. sorts of see the believe I strategic that hopefully levels I'll way. we to as that I create creatively Media, particularly markets shareholders. in, which own having at to best well we think -- hard But couple at go rate said now, trading ability underlying at if as these We pretty we and who the operate we optionality of in And do return in operations, the Virgin say of will honestly and I our seriously think how and growth own that and look of our value times our and are continuing look will in, we as business. we a for great the we

hand, create think those very monetizing record or when first, from track had I or terrific finding and value and we consolidating you attractive, On and or when buying other operators are ways have appropriate a we businesses, of the know, businesses. building to

So have that's great Europe. I experience what we do. And think we in

to attractive we record do. continue We have said, that's and I pretty, And smart making as will acquisitions in strong at something track prices. appropriate

Tom, the out there, Those chime in million to can homes speak. still here. so build, On you X are of pace

look are new we success so return as capital know long realizing already exist. success And returns I are we book we are foolish and high source of a think And great to growth would for it having not and as build of the at having be and churning us we investment.

we on guidance give long-term are that. to not going you So a

X.X We have built million homes.

in homes U.K. more the market built have anybody than else. We

from in be game business would I plans you market the So, look haven't have these operators talked cautious at pretty other as but much. done who a good

of terms of and rest these market build a So and to we are homes understanding make way on both return the them. ahead of how the how to in where

capital. it's So are And if expect returns, our whether are great to are say we that give not knowledge, million longer-term want we you long million as to ahead, it's think advantage going a take experience. smart plough on that guidance of to I X of X so or getting use we a we

James Ratzer

you. thank Great,

Operator

JPMorgan. with to Dattani now Akhil move We'll

Akhil Dattani

thanks question. Hi, taking for the

change it reduce the the you Obviously build that that formalize I the to bit if but you the just said to on expect a infrastructure, to first guess bit more is landscape? skepticism take about threats And is guess earlier. The I And and telecom the just a numbers will then you U.K. if the this guess guess came broadly government later? I are I build entrants the U.K. of cost. guess do in mean might I a some together initiatives big Mike, made to have guess, is comments you would when future how your and pull maybe is about reference what more something your market. out in I governments talk you from second broad optimistic And mentioned thinking you the competitive have it thoughts around the of around happen. around that. just might picture understand ambitions seems some one of question. might views now, might it you some premature your pretty the help so, I linked new I to to U.K. just keen to the understand guess How other into that?

be the XXXX? growth of X, key color sensitivities. expecting in wonder first-half trends versus any so Just to truly give is Thanks. if of target key markets around Your are able might full-year OCF X.X% kind you to you us improve and

Mike Fries

first backwards growth strong working in rate quarter. OCF have in Maybe Sure. the we a Virgin

by impacted The prior second was in quarter, the one-off of the settlement course, year.

closer If second out, settlement growth X% or you we took in growth were EBITDA that the quarter. to OCF

trend in we where we U.K. the to trending are So need

I question a think markets tailwind Where half lot the that of started was the need U.K. we some in because is I think other to we we the in of year think U.K. second of referencing our there which both you and identified. your trend,

is what of is our that And U.K. supports course. guidance. of So that of part a view big

XXXX up in something or shooting X terms of overlap are by are we and be million hoping to homes. In that I the that, is XXXX, go all adds probably all have build press - of builds where build number that's to like people on have. much to they same those X fiber-to-home in And release of as to I are homes there the think for we terms hoping million pretty you mean there some

won't that towards We out. plan case. three, undeniably them Not to trending all. That competitor. the BUS faster two, say of mobile the years some market is isn't And get built four at broadband

And the as part. and capacity faster more constantly already bit and so And that's for more are XXX expect a are we in everybody million we curve. have speeds And XX homes why plus/minus. competitors most U.K. into to across in our much the else's digits put robust we while the ahead MEG investing fiber, we money We up to our while double have speeds. of

in I continue that view, terms build, now It way broadband is from we So lead won't we of there point think to doesn't to aggressive. be more intend speeds. of mean the

down, add if, try actually we to going amount up you to that quarterly to And cheaper date PP&E build a MDUs, differential. build. of disclose more to likely that's we take our And cumulatively I cost to I will jump have period don't a the get build improved are per we significant that to kind cost which of it's And XXX-XXX of very know premise an to was Charlie, aggressive. reference been better look be that going some coming whether for means But our in have to will access at to in I or over be here. time. cost are we that think time advantage We speed we of think quickly as you number. to advantage don't if

was this anything and years. think to that over bit call to I I point? that we just smarter purpose about as market know we last add in if of that learn a you Charlie quite get the three the want don't construction as last

Charlie Bracken

would No, say, back absolutely right. no, as also and higher, still but we're We saw that's saw XXX. trend And in time. actually to down, And obviously over certainly slightly cross in the time mix projects that at in think in that I build our reasons trend Chile I the should minds better there're around and XXX, around we day. we depending believe build on down building the trend cross the get other that -- bill over

Mike Fries

one Yes, at we gig. will be

competition ability take entire Virgin have it, when time the one decisions. in and to allocation to right and probably in capital response gig. We do platform the choose will to both it some be which years the a three to And would we be next the to

Akhil Dattani

Thank you. That's great.

Operator

We'll from with you. Carl take our final question Murdock-Smith Thank Berenberg.

Carl Murdock-Smith

Hi, much. very thanks

afraid. Project Lightning on again, up Following I'm

to of build as Is that extent economics about you to party with builders a to third kind costs builders what might there, to costs you'd talked rollouts You've of build and push party share locations. Thanks. and possibly in be market open more something lot sacrifice improving partnering the rural into improve third consider, you network but exclusivity?

Mike Fries

Well, I to approached is of who needs they team uncovered intend Tom are as by competitors think any CapEx clearly try the have and capital been answer build or build to and out. possibly. looking at And and needs their own the number

think I the So answer possibly. is,

and this and But smart most optimal be create of ones particular that can overbill reduce anything. certainly reduce others the we it. only Right outcome this We that, look it to the and have there concluded disclosed we have building are anything, cost certainly we're nothing at likely to that. think to try pace. as and be at cost announced who think than are to said, haven't us on area. but overlap, haven't opportunities would I We would if we higher we in they we are the And disclose look now, at would to

Carl Murdock-Smith

a Thanks lot…

Mike Fries

great. Okay,

joined appreciate I So everybody in.

and think we part strong well some, indicated, I looks to thought have optionality in the the got us. that. performing performing is we continuing received stronger. quarter never to deal Media be we a we it, turnaround of was team in the talked on of outcome really the us we great We've to well by in of transaction, M&A been think, going in be we great plans track. more as work Vodafone importantly, Virgin in all are are The ops, have strategic And about on has right All And great. that track think authorities. as do think, them. for year, but top I businesses of of we you the the a on and it front know, had And strong half deals particular, a second regulatory

forward Thanks a the call. you look you much. on very summer, appreciate third So have talking to joining to us, great quarter we

Operator

and Global's Investor gentlemen, concludes Quarter Ladies Second XXXX Call. this Liberty

As a reminder, copy relations a replay section of a find site. today's presentation materials. the investor call Web you in Global's be Liberty also can will There, the available of of