Yahoo Finance Why Is Liberty Global PLC (LBTYA) Up 12.9% Since Last Earnings Report?
A month has gone by since the last earnings report for Liberty Global PLC (LBTYA). Shares have added about 12.9% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Liberty Global PLC due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Liberty Global Q3 Earnings Increase Y/Y, Revenues Fall
Liberty Global's earnings from continuing operations in third-quarter 2022 amounted to $2.431 billion, increasing 670.5% year over year.
Revenues declined 4.9% year over year to $789.8 million. On a rebased basis, revenues increased 1.5% year over year.
The Zacks Consensus Estimate for earnings and revenues were pegged at break-even per share and $1.72 billion, respectively.
Liberty Global lost 14,000 customer relationships in the reported quarter compared with 5,400 customers lost in the year-ago quarter.
Top-Line Details
The average revenue per unit (“ARPU”) per cable customer relationship declined 10.6% to $61.62.
Mobile ARPU (including interconnect revenues), on a reported basis, decreased 10.9% to $26.02. On a rebased basis, the figure dropped 1.2%.
Mobile ARPU (excluding interconnect revenues), on a reported basis, decreased 8.5% to $23.80.
In Belgium, Liberty Global lost 7,700 customer relationships compared with a loss of 2,300 in the year-ago quarter.
Belgium’s revenues, on a reported basis, declined 12% year over year to $665.1 million. On a rebased basis, revenues inched up 3.1%.
In Switzerland, Liberty Global lost 3,200 customer relationships compared with the loss of 1,600 in the year-ago quarter.
Switzerland’s revenues, on a reported basis, declined 4.9% year over year to $789.8 million. On a rebased basis, revenues increased 1.5%.
The company lost 1900 customer relationships in Ireland compared with a loss of 1100 in the year-ago quarter.
Ireland’s revenues, on a reported basis, fell 14.6% to $116.1 million.
In Slovakia, Liberty Global lost 1200 customer relationships compared with a loss of 400 in the year-ago quarter.
Central and other revenues, on a reported basis, decreased 2.2% to $177.4 million. On a rebased basis, the top line increased 22.3%
Joint Venture Details
Sunrise revenues of $789.8 million decreased 4.9% year over year on a reported basis and increased 1.5% year over year on a rebased basis, driven by low-margin business wholesale revenues and strong trading momentum in yallo and handset revenues. Broadband performance was flat in the third quarter, given the ongoing phase-out of the UPC brand. Fixed mobile convergence (“FMC”) penetration remained high at 57% of Sunrise's broadband base, supported by a strong mobile offering along with the powerful fixed line network.
Telenet reported and rebased revenues decreased 12% and increased 3.1%, respectively, to $665.1 million in the third quarter. The increase in rebased revenues was primarily driven by higher fixed subscription revenues following the June price increase and an increase in mobile roaming revenues. The continued growth of Telenet's FMC customer base in the third quarter was driven by the continued uptake of “ONE(Up)” bundles as growth in the mobile customer base accelerated with 18,000 postpaid mobile net additions.
Liberty Global’s non-consolidated joint venture — Virgin Media O2 — reported revenues of $3.042 billion. This was due to the net effect of a decline in consumer fixed revenues due to a change in customer mix and a decline in B2B fixed revenues.
Growth in VMO2's fixed customer base and continued demand for fast, high-quality connectivity drove the quarter’s broadband net additions to 19,000. Postpaid mobile continued to show growth with net adds of 47,000 during the quarter. Average speed across the company's broadband base increased 29% year over year and has reached 261Mbps, more than 4x the national average.
Vodafone Ziggo revenues declined 13.6% on a reported basis and increased 1% on a rebased basis, year over year, to $1.041 billion. The increase in rebased revenues was primarily driven by ARPU growth and mobile postpaid and B2B fixed customer base growth, partially offset by B2C fixed customer base decline.
Operating Details
Adjusted EBITDA declined 12.5% year over year to $664 million in the third quarter. On a rebased basis, EBITDA increased 1.6%.
Switzerland’s EBITDA, on a rebased basis, declined 2.3% from the year-ago quarter.
Belgium’s EBITDA, on a rebased basis, increased 4.8% year over year.
Ireland’s EBITDA, on a rebased basis, decreased 2% year over year.
Operating income was $108.9 million in the reported quarter compared with $101 million in the year-ago quarter.
Balance Sheet & Cash Flow
As of Sep 30, 2022, Liberty Global had $3.968 billion of cash, investments under SMAs and unused borrowing capacity compared to $5.6 billion in the previous quarter.
In the third quarter, the total principal amount of debt and finance leases was $13.263 billion for continuing operations compared with $13.3 billion in the previous quarter. The average debt tenor is six years, with approximately 94% not due until 2028 or later.
Cash provided by operating activities was $540.5 million, down 11.8% year over year.
Moreover, adjusted free cash flow was $147.5 million in the third quarter compared with a free cash flow of $427 million in the previous quarter and $292.4 million in the year-ago quarter.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
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