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Liberty Latin America Reports Q4 & FY 2022 Results

FY 2022 reported revenue flat YoY at $4.8 billion and up 1% on rebased basis; 3% rebased growth ex VTR

445,000 organic broadband and postpaid mobile adds in 2022, ex VTR

Executing inorganic strategy and advancing integration efforts

Repurchased a record $170 million of shares in the year

Liberty Latin America Ltd. (“Liberty Latin America” or “LLA”) (NASDAQ: LILA and LILAK, OTC Link: LILAB) today announced its financial and operating results for the three months (“Q4”) and twelve months (“YTD” and “FY”) ended December 31, 2022.

CEO Balan Nair commented, “We continued to drive top-line growth in the fourth quarter, led by strong performances in our C&W Caribbean and Networks & LatAm operations and in Costa Rica. Puerto Rico's performance was impacted by residual negative impacts from Hurricane Fiona, and higher levels of promotional activity.”

“Subscriber growth underpinned our performance with continued broadband additions across our reporting segments. Mobile postpaid additions also more than doubled as compared to the prior year, fueled by our convergent offers and focus on prepaid to postpaid migration.”

“Inorganically, we have now completed our outstanding transactions and are focused on integration activities in Puerto Rico, Panama and Costa Rica, which are set to deliver significant value for stakeholders.”

“We have continued to be aggressive with our share buyback activity, purchasing a record amount during the year and taking our total since commencing activity to over $240 million as we remain confident in our plans and outlook for the business.”

“Overall, we continued to drive operating momentum in 2022 and are well positioned to create value in 2023. Our focus this year is on delivering further broadband and postpaid mobile subscriber growth, and making significant progress towards the successful integration of our acquisitions in Puerto Rico, Costa Rica and Panama. Through these actions, we expect to generate mid-to-high single digit adjusted OIBDA expansion in 2023 and strong adjusted free cash flow growth.”

Business Highlights

  • C&W Caribbean: strong growth in FY 2022
    • Subscriber adds drove reported and rebased revenue up 3% and 4%, respectively
    • Reported and rebased Adj. OIBDA growth of 11% for the year
  • C&W Panama: strong fixed operating momentum
    • 25,000 broadband adds in the year drove fixed service revenue growth
    • Claro Panama acquisition completed; integration and synergy capture underway
  • C&W Networks & LatAm: top-line and Adj. OIBDA growth with strong margins in FY 2022
    • Reported and rebased revenue growth of 4% and 7%, respectively
    • Reported and rebased Adj. OIBDA growth of 5%
  • Liberty Puerto Rico: fixed growth driven by continued subscriber additions
    • 36,000 broadband adds in 2022, Q4 up 35% YoY
    • Adj. OIBDA impacted by Hurricane Fiona and increased promotional activity
  • Liberty Costa Rica: subscriber additions and cost control driving Adj. OIBDA growth
    • Reported and rebased revenue growth of 71% and 7%, respectively, YTD
    • Adj. OIBDA up 68% and 10% on a reported and rebased basis, respectively, YTD

FY 2023 LLA Financial Guidance

  • Adjusted OIBDA mid-to-high single digit rebased growth
  • P&E additions as a percentage of revenue at ~16%
  • Adjusted FCF of ~$300 million, before distributions to noncontrolling interests

50/50 Joint Venture with América Móvil in Chile

VTR has been deconsolidated from Liberty Latin America effective upon our contribution of VTR into the Chile JV, at the beginning of October 2022.

Financial and Operating Highlights

Financial Highlights

 

Q4 2022

 

Q4 2021

 

YoY Growth /

(Decline)

 

YoY Rebased

Growth /

(Decline)1

 

FY 2022

 

FY 2021

 

YoY Growth /

(Decline)

 

YoY Rebased

Growth /

(Decline)1

(USD in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

1,161

 

 

$

1,281

 

 

(9

%)

 

1

%

 

$

4,815

 

 

$

4,815

 

 

%

 

1

%

Revenue (excluding VTR)2

 

$

1,161

 

 

$

1,106

 

 

5

%

 

1

%

 

$

4,365

 

 

$

4,027

 

 

8

%

 

3

%

Adjusted OIBDA3

 

$

405

 

 

$

464

 

 

(13

%)

 

(1

%)

 

$

1,718

 

 

$

1,815

 

 

(5

%)

 

(3

%)

Adjusted OIBDA3 (excluding VTR)2

 

$

405

 

 

$

408

 

 

(1

%)

 

(1

%)

 

$

1,602

 

 

$

1,556

 

 

3

%

 

%

Operating income (loss)

 

$

110

 

 

$

(418

)

 

(126

%)

 

 

 

$

94

 

 

$

67

 

 

40

%

 

 

Property & equipment additions

 

$

225

 

 

$

257

 

 

(12

%)

 

 

 

$

816

 

 

$

856

 

 

(5

%)

 

 

As a percentage of revenue

 

 

19

%

 

 

20

%

 

 

 

 

 

 

17

%

 

 

18

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted FCF4

 

$

210

 

 

$

51

 

 

 

 

 

 

$

189

 

 

$

200

 

 

 

 

 

Cash provided by operating activities

 

$

377

 

 

$

298

 

 

 

 

 

 

$

869

 

 

$

1,016

 

 

 

 

 

Cash used by investing activities

 

$

(378

)

 

$

(193

)

 

 

 

 

 

$

(1,123

)

 

$

(1,269

)

 

 

 

 

Cash provided (used) by financing activities

 

$

(51

)

 

$

(104

)

 

 

 

 

 

$

(29

)

 

$

427

 

 

 

 

 

 

Operating Highlights5

 

Q4 2022

 

Q4 2021

 

Total customers

 

 

1,924,700

 

 

 

3,226,400

 

 

Organic customer losses

 

 

(3,300

)

 

 

(10,300

)

 

Fixed RGUs

 

 

3,819,500

 

 

 

6,441,000

 

 

Organic RGU additions

 

 

31,300

 

 

 

35,800

 

 

Organic internet additions

 

 

24,700

 

 

 

5,200

 

 

Mobile subscribers

 

 

8,169,500

 

 

 

7,540,300

 

 

Organic mobile additions

 

 

59,000

 

 

 

246,400

 

 

Organic postpaid additions

 

 

58,200

 

 

 

68,700

 

 

*

Q4 2022 figures include mobile subscribers related to the Claro Panama Acquisition, which was completed on July 1, 2022, and are therefore not included in Q4 2021 subscriber data. Q4 2022 excludes VTR as it has been deconsolidated as further described above.

Revenue Highlights

The following table presents (i) revenue of each of our segments and corporate operations for the periods indicated and (ii) the percentage change from period-to-period on both a reported and rebased basis:

 

Three months ended

 

Increase/(decrease)

 

Year ended

 

Increase/(decrease)

 

December 31,

 

 

December 31,

 

 

2022

 

2021

 

%

 

Rebased %

 

2022

 

2021

 

%

 

Rebased %

 

in millions, except % amounts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

C&W Caribbean

$

367.3

 

 

$

356.9

 

 

3

 

 

3

 

 

$

1,436.8

 

 

$

1,389.9

 

 

3

 

 

4

 

C&W Panama

 

201.4

 

 

 

173.6

 

 

16

 

 

(3

)

 

 

642.7

 

 

 

568.1

 

 

13

 

 

1

 

C&W Networks & LatAm

 

124.0

 

 

 

111.9

 

 

11

 

 

14

 

 

 

450.8

 

 

 

431.9

 

 

4

 

 

7

 

Liberty Puerto Rico

 

373.7

 

 

 

371.2

 

 

1

 

 

 

 

 

1,470.1

 

 

 

1,449.7

 

 

1

 

 

1

 

Liberty Costa Rica

 

116.7

 

 

 

108.2

 

 

8

 

 

3

 

 

 

441.3

 

 

 

258.5

 

 

71

 

 

7

 

VTR

 

 

 

 

174.8

 

 

N.M.

 

N.M.

 

 

450.6

 

 

 

787.5

 

 

(43

)

 

(15

)

Corporate

 

5.7

 

 

 

5.4

 

 

6

 

 

6

 

 

 

22.2

 

 

 

21.6

 

 

3

 

 

3

 

Eliminations

 

(28.1

)

 

 

(21.4

)

 

N.M.

 

N.M.

 

 

(99.4

)

 

 

(92.4

)

 

N.M.

 

N.M.

Total

$

1,160.7

 

 

$

1,280.6

 

 

(9

)

 

1

 

 

$

4,815.1

 

 

$

4,814.8

 

 

 

 

1

 

Less: VTR

 

 

 

 

174.8

 

 

 

 

 

 

 

450.6

 

 

 

787.5

 

 

 

 

 

Total excluding VTR2

$

1,160.7

 

 

$

1,105.8

 

 

5

 

 

1

 

 

$

4,364.5

 

 

$

4,027.3

 

 

8

 

 

3

 

N.M. – Not Meaningful.

  • Reported revenue for the three months and year ended December 31, 2022 declined by 9% and was flat, respectively.
    • Reported revenue declined in Q4 2022 as (1) the addition of $35 million from the acquisition of América Móvil's Panama operations (Claro Panama) on July 1, 2022, and (2) organic growth in C&W Networks & LatAm and C&W Caribbean, were more than offset by the negative year-over-year impact of VTR's deconsolidation further to the formation of the Chile JV in October 2022.
    • Reported revenue performance in FY 2022 was driven by (1) the addition of $239 million, from the acquisitions of Telefónica's Costa Rica operations and América Móvil's Panama operations, (2) the impact of VTR's deconsolidation, (3) organic growth in C&W Caribbean, C&W Networks & LatAm and Liberty Costa Rica, (4) a net negative FX impact of $94 million, and (5) organic declines at VTR. The FX impact was driven by depreciation of the Chilean peso in the nine months ended September 30, 2022 as compared to the corresponding prior-year period.

Q4 2022 Revenue Growth – Segment Highlights

  • C&W Caribbean: revenue grew by 3% on a reported and rebased basis.
    • Fixed residential revenue was flat on a reported and rebased basis, as subscription revenue growth was offset by lower interconnect and other revenue year-over-year.
    • Mobile revenue was up 5% on a reported and rebased basis, as compared to the prior-year period. Rebased growth was primarily driven by a higher average number of mobile subscribers, resulting from sales initiatives, including converged offerings. Inbound roaming also grew year-over-year, as a recovery in tourism led to increased traffic.
    • B2B revenue was 4% higher on both a reported and rebased basis. Performance was driven by internet services-related growth as well as mobile subscriber growth.
  • C&W Panama: revenue grew by 16% and declined by 3% on a reported and rebased basis, respectively. Reported performance benefited from the inclusion of América Móvil's Panama operations in the quarter.
    • Fixed residential revenue was up 15% and 5% on a reported and rebased basis, respectively. Rebased growth was driven by more than 60,000 RGU additions over the past twelve months, resulting from investments in our networks, products and commercial activities.
    • Mobile revenue increased by 45% on a reported basis and was 1% lower on a rebased basis. Revenue declined slightly on a rebased basis as postpaid service revenue growth in our legacy C&W Panama operation was more than offset by year-over-year declines in our newly acquired business.
    • B2B revenue declined by 1% and 7% on a reported and rebased basis, respectively. The year-over-year rebased decline was driven by the successful award of certain infrastructure projects in the prior-year period.
  • C&W Networks & LatAm: revenue grew by 11% and 14% on a reported and rebased basis, respectively. Growth on a rebased basis was driven by higher revenue associated with a significant subsea network customer that is recognized on a cash basis, increased affiliate revenue, and growth in B2B service-related connectivity and managed services. This growth was partially offset by higher IRU accelerations in Q4 2021.
  • Liberty Puerto Rico: revenue grew by 1% on a reported basis and was flat on a rebased basis. Reported performance benefited from the inclusion of our fixed operations in the USVI in the quarter.
    • On a rebased basis, residential fixed revenue growth was driven by subscriber additions as we added nearly 40,000 RGUs in the year, partly offset by the negative impact of $5 million of customer credits following Hurricane Fiona.
    • Residential mobile revenue was broadly flat compared to the prior-year period, as higher volumes of handset sales were offset by (1) lower ARPU from mobile services, including the impact of higher contract asset amortization driven by increases in handset sales and subsidy levels, and (2) a decline in the average number of prepaid mobile subscribers.
  • Liberty Costa Rica: revenue grew by 8% and 3% on a reported and rebased basis, respectively. Rebased growth was driven by strong subscriber additions across both our mobile and fixed businesses over the past twelve months.

Operating Income (Loss)

  • Operating income (loss) was $110 million and ($418 million) for the three months ended December 31, 2022 and 2021, respectively, and $94 million and $67 million for the year ended December 31, 2022 and 2021, respectively.
    • We reported operating income during the three months ended December 31, 2022 compared with an operating loss during the corresponding period in 2021. The increase during the three-month comparison is due to lower expenses associated with impairment, restructuring and other operating items, net, which were partially offset by a decline in Adjusted OIBDA.
    • We reported higher operating income during the year ended December 31, 2022 compared with the corresponding period in 2021, primarily due to the net effect of (i) decreases in depreciation and amortization, goodwill impairments and stock-based compensation expense and (ii) a decline in Adjusted OIBDA. We experienced a decrease in depreciation and amortization expense as we ceased recording depreciation expense for the Chile JV Entities during the third quarter of 2021 when we began accounting for them as held for sale.

Adjusted OIBDA Highlights

The following table presents (i) Adjusted OIBDA of each of our reportable segments and our corporate category for the periods indicated and (ii) the percentage change from period-to-period on both a reported and rebased basis:

 

Three months ended

 

 

 

 

 

 

 

 

 

 

 

 

Year ended

 

 

 

 

 

 

 

 

 

December 31,

 

 

 

Increase (decrease)

 

 

 

December 31,

 

 

 

Increase (decrease)

 

2022

 

 

2021

 

 

 

%

 

 

 

 

Rebased %

 

 

 

2022

 

 

2021

 

 

 

%

 

 

 

Rebased %

 

in millions, except % amounts

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

C&W Caribbean

$

138.1

 

 

 

$

125.0

 

 

 

 

10

 

 

 

 

10

 

 

 

$

535.2

 

 

 

$

482.9

 

 

 

 

11

 

 

 

 

11

 

C&W Panama

 

57.2

 

 

 

 

62.6

 

 

 

 

(9

)

 

 

 

(10

)

 

 

 

188.8

 

 

 

 

200.1

 

 

 

 

(6

)

 

 

 

(7

)

C&W Networks & LatAm

 

79.7

 

 

 

 

71.2

 

 

 

 

12

 

 

 

 

13

 

 

 

 

276.3

 

 

 

 

264.3

 

 

 

 

5

 

 

 

 

5

 

Liberty Puerto Rico

 

120.2

 

 

 

 

135.3

 

 

 

 

(11

)

 

 

 

(11

)

 

 

 

538.4

 

 

 

 

580.9

 

 

 

 

(7

)

 

 

 

(8

)

Liberty Costa Rica

 

36.1

 

 

 

 

29.4

 

 

 

 

23

 

 

 

 

17

 

 

 

 

134.7

 

 

 

 

80.2

 

 

 

 

68

 

 

 

 

10

 

VTR

 

 

 

 

 

55.3

 

 

 

 

N.M.

 

 

 

N.M.

 

 

 

115.6

 

 

 

 

259.6

 

 

 

 

(55

)

 

 

 

(34

)

Corporate

 

(26.1

)

 

 

 

(15.2

)

 

 

 

(72

)

 

 

 

(72

)

 

 

 

(71.5

)

 

 

 

(52.9

)

 

 

 

(35

)

 

 

 

(35

)

Total

$

405.2

 

 

 

$

463.6

 

 

 

 

(13

)

 

 

 

(1

)

 

 

$

1,717.5

 

 

 

$

1,815.1

 

 

 

 

(5

)

 

 

 

(3

)

Less: VTR

 

 

 

 

 

55.3

 

 

 

 

 

 

 

 

 

 

 

 

115.6

 

 

 

 

259.6

 

 

 

 

 

 

 

 

 

Total excluding VTR2

$

405.2

 

 

 

$

408.3

 

 

 

 

(1

)

 

 

 

(1

)

 

 

$

1,601.9

 

 

 

$

1,555.5

 

 

 

 

3

 

 

 

 

 

Operating income (loss) margin

 

9.4

%

 

 

 

(32.6

) %

 

 

 

 

 

 

 

 

 

 

 

2.0

%

 

 

 

1.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted OIBDA margin

 

34.9

%

 

 

 

36.2

%

 

 

 

 

 

 

 

 

 

 

 

35.7

%

 

 

 

37.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted OIBDA margin excl. VTR2

 

34.9

%

 

 

 

36.9

%

 

 

 

 

 

 

 

 

 

 

 

36.7

%

 

 

 

38.6

%

 

 

 

 

 

 

 

 

N.M. – Not Meaningful.

  • Our reported Adjusted OIBDA for the three months and year ended December 31, 2022 was 13% and 5% lower, respectively, as compared to the corresponding prior-year periods.
    • Reported Adjusted OIBDA performance in Q4 was primarily driven by the deconsolidation of VTR.
    • Reported Adjusted OIBDA performance YTD was primarily driven by (1) organic declines in Chile and Puerto Rico partly offset by growth in C&W Caribbean, and (2) FX headwinds in Chile.

Q4 2022 Adjusted OIBDA Growth – Segment Highlights

  • C&W Caribbean: Adjusted OIBDA increased by 10% on a reported and rebased basis. Performance was driven by the aforementioned rebased revenue growth. Our Adjusted OIBDA margin improved by ~250 basis points year-over-year to 38%.
  • C&W Panama: Adjusted OIBDA decreased on a reported and rebased basis by 9% and 10%, respectively. The rebased decline was driven by lower revenue and higher bad debt provisions, including the cost of factoring certain receivables, year-over-year.
  • C&W Networks & LatAm: Adjusted OIBDA increased on a reported and rebased basis by 12% and 13%, respectively. Our rebased performance was driven by the aforementioned revenue growth.
  • Liberty Puerto Rico: Adjusted OIBDA declined by 11% on a reported and rebased basis. The decline in the quarter was driven by (i) $7 million in revenue credits and costs associated with Hurricane Fiona (aforementioned revenue credits and increased network-related expenses), (ii) increased facilities costs driven by higher electricity and maintenance expense, (iii) higher personnel costs including higher commissions expense impacted by the accounting for the AT&T acquisition, and (iv) increased negative margins on equipment sales driven by a higher volume of handset sales and promotions.
  • Liberty Costa Rica: Adjusted OIBDA grew by 23% and 17% on a reported and rebased basis, respectively. Rebased performance was driven by the aforementioned rebased revenue growth and cost control driving a nearly 400 basis point improvement in Adjusted OIBDA margin, year-over-year.

Net Earnings (Loss) Attributable to Shareholders

  • Net earnings (loss) attributable to shareholders was $135 million and ($612 million) for the three months ended December 31, 2022 and 2021, respectively, and ($176 million) and ($438 million) for the year ended December 31, 2022 and 2021, respectively.

Property & Equipment Additions and Capital Expenditures

The table below highlights the categories of the property and equipment additions (P&E Additions) for the indicated periods and reconciles to cash paid for capital expenditures, net.

 

Three months ended

 

 

Year ended

 

December 31,

 

 

December 31,

 

2022

 

2021

 

 

2022

 

2021

 

USD in millions

 

 

 

 

 

Customer Premises Equipment

$

40.9

 

$

61.0

 

$

246.3

 

$

296.2

 

New Build & Upgrade

 

44.9

 

 

51.5

 

 

156.7

 

 

163.2

 

Capacity

 

41.4

 

 

35.8

 

 

127.3

 

 

130.9

 

Baseline

 

71.6

 

 

68.3

 

 

210.8

 

 

172.7

 

Product & Enablers

 

26.4

 

 

40.3

 

 

75.2

 

 

92.9

 

Property & equipment additions

 

225.2

 

 

256.9

 

 

816.3

 

 

855.9

 

Assets acquired under capital-related vendor financing arrangements

 

(46.9

)

 

(35.5

)

 

(161.1

)

 

(100.5

)

Changes in current liabilities related to capital expenditures and other

 

(12.3

)

 

(29.8

)

 

4.9

 

 

(19.1

)

Capital expenditures, net

$

166.0

 

$

191.6

 

$

660.1

 

$

736.3

 

Property & equipment additions as % of revenue

 

19.4

%

 

20.1

%

 

17.0

%

 

17.8

%

Property & Equipment Additions:

 

 

 

 

C&W Caribbean

$

79.3

 

$

67.4

 

$

230.7

 

$

222.9

 

C&W Panama

 

26.8

 

 

24.4

 

 

98.4

 

 

88.9

 

C&W Networks & LatAm

 

8.2

 

 

9.9

 

 

40.2

 

 

45.3

 

Liberty Puerto Rico

 

78.7

 

 

80.1

 

 

233.5

 

 

219.2

 

Liberty Costa Rica

 

19.8

 

 

19.4

 

 

65.5

 

 

45.0

 

VTR

 

 

 

41.1

 

 

107.3

 

 

199.1

 

Corporate

 

12.4

 

 

14.6

 

 

40.7

 

 

35.5

 

Property & equipment additions

$

225.2

 

$

256.9

 

$

816.3

 

$

855.9

 

Property & Equipment Additions as a Percentage of Revenue by Reportable Segment:

 

 

 

 

C&W Caribbean

 

21.6

%

 

18.9

%

 

16.1

%

 

16.0

%

C&W Panama

 

13.3

%

 

14.1

%

 

15.3

%

 

15.6

%

C&W Networks & LatAm

 

6.6

%

 

8.8

%

 

8.9

%

 

10.5

%

Liberty Puerto Rico

 

21.1

%

 

21.6

%

 

15.9

%

 

15.1

%

Liberty Costa Rica

 

17.0

%

 

17.9

%

 

14.8

%

 

17.4

%

VTR

 

%

 

23.5

%

 

23.8

%

 

25.3

%

New Build and Homes Upgraded by Reportable Segment1:

 

 

 

 

C&W Caribbean

 

15,800

 

 

47,100

 

 

106,700

 

 

150,100

 

C&W Panama

 

19,100

 

 

16,600

 

 

148,400

 

 

121,400

 

Liberty Puerto Rico

 

16,900

 

 

9,500

 

 

41,800

 

 

22,600

 

Liberty Costa Rica

 

11,000

 

 

10,600

 

 

50,300

 

 

43,800

 

VTR

 

 

 

64,200

 

 

137,400

 

 

400,900

 

Total

 

62,800

 

 

148,000

 

 

484,600

 

 

738,800

 

1.

Table excludes C&W Networks & LatAm as that segment only provides B2B-related services.

Summary of Debt, Finance Lease Obligations and Cash and Cash Equivalents

The following table details the U.S. dollar equivalent balances of the outstanding principal amounts of our debt and finance lease obligations, and cash and cash equivalents at December 31, 2022:

 

Debt

 

Finance lease

obligations

 

Debt and

finance lease

obligations

 

Cash and

cash

equivalents

 

in millions

 

 

 

 

 

 

 

 

Liberty Latin America1

$ 403.4

 

$ —

 

$ 403.4

 

$ 156.5

C&W2

4,519.6

 

 

4,519.6

 

536.2

Liberty Puerto Rico

2,617.7

 

5.7

 

2,623.4

 

72.3

Liberty Costa Rica

425.4

 

2.9

 

428.3

 

16.0

Total

$ 7,966.1

 

$ 8.6

 

$ 7,974.7

 

$ 781.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated Leverage and Liquidity Information:

 

December 31,

2022

 

September 30,

2022

 

 

 

 

 

 

 

 

Consolidated debt and finance lease obligations to operating income (loss) ratio

 

15.0x

 

(23.1)x

Consolidated net debt and finance lease obligations to operating income (loss) ratio

 

13.5x

 

(21.1)x

Consolidated gross leverage ratio3

 

5.1x

 

4.9x

Consolidated net leverage ratio3

 

4.6x

 

4.5x

Average debt tenor4

 

4.9 years

 

5.2 years

Fully-swapped borrowing costs

 

5.7%

 

5.6%

Unused borrowing capacity (in millions)5

 

$898.7

 

$971.7

1.

Represents the amount held by Liberty Latin America on a standalone basis plus the aggregate amount held by subsidiaries of Liberty Latin America that are outside our borrowing groups.

2.

Represents the C&W borrowing group, including the C&W Caribbean, C&W Networks & LatAm and C&W Panama reporting segments.

3.

Consolidated leverage ratios are non-GAAP measures. The leverage ratios exclude the Adjusted OIBDA of VTR in light of the deconsolidation of VTR and the fact that our December, 31, 2022 balance sheet does not include any VTR debt. For additional information, including definitions of our consolidated leverage ratios and required reconciliations, see Non-GAAP Reconciliations below.

4.

For purposes of calculating our average tenor, total debt excludes vendor financing, finance lease obligations and, as of September 30, 2022, VTR debt.

5.

At December 31, 2022, the full amount of unused borrowing capacity under our subsidiaries' revolving credit facilities was available to be borrowed, both before and after completion of the December 31, 2022 compliance reporting requirements. The September 30, 2022 amount excludes VTR's then unused borrowing capacity of $247 million.

Quarterly Subscriber Variance

 

Fixed and Mobile Subscriber Variance Table — December 31, 2022 vs September 30, 2022

 

Homes

Passed

 

Two-way

Homes

Passed

 

Fixed-line

Customer

Relationships

 

Video

RGUs

 

Internet

RGUs

 

Telephony

RGUs

 

Total

RGUs

 

 

Prepaid

 

Postpaid

 

Total Mobile

Subscribers

 

 

 

 

 

C&W Caribbean:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Jamaica

6,900

 

 

6,900

 

 

2,600

 

 

(400

)

 

4,100

 

 

4,600

 

 

8,300

 

 

 

18,900

 

 

8,800

 

 

27,700

 

The Bahamas

 

 

 

 

(7,900

)

 

(200

)

 

(100

)

 

(900

)

 

(1,200

)

 

 

4,500

 

 

(600

)

 

3,900

 

Trinidad and Tobago

 

 

 

 

(800

)

 

(600

)

 

(1,100

)

 

600

 

 

(1,100

)

 

 

 

 

 

 

 

Barbados

 

 

 

 

400

 

 

300

 

 

900

 

 

(100

)

 

1,100

 

 

 

1,200

 

 

2,600

 

 

3,800

 

Other

200

 

 

100

 

 

2,700

 

 

500

 

 

3,900

 

 

400

 

 

4,800

 

 

 

200

 

 

11,500

 

 

11,700

 

Total C&W Caribbean

7,100

 

 

7,000

 

 

(3,000

)

 

(400

)

 

7,700

 

 

4,600

 

 

11,900

 

 

 

24,800

 

 

22,300

 

 

47,100

 

C&W Panama

4,900

 

 

4,900

 

 

600

 

 

600

 

 

5,400

 

 

5,100

 

 

11,100

 

 

 

(65,900

)

 

8,700

 

 

(57,200

)

Total C&W

12,000

 

 

11,900

 

 

(2,400

)

 

200

 

 

13,100

 

 

9,700

 

 

23,000

 

 

 

(41,100

)

 

31,000

 

 

(10,100

)

Liberty Puerto Rico1

4,100

 

 

4,100

 

 

(3,100

)

 

(4,700

)

 

10,400

 

 

(3,300

)

 

2,400

 

 

 

(5,300

)

 

17,000

 

 

11,700

 

Liberty Costa Rica

8,600

 

 

8,600

 

 

2,200

 

 

 

 

1,200

 

 

4,700

 

 

5,900

 

 

 

47,200

 

 

10,200

 

 

57,400

 

VTR

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Organic Change

24,700

 

 

24,600

 

 

(3,300

)

 

(4,500

)

 

24,700

 

 

11,100

 

 

31,300

 

 

 

800

 

 

58,200

 

 

59,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q4 2022 Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

C&W Caribbean - Jamaica

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(14,400

)

 

 

 

(14,400

)

C&W Caribbean - Bahamas

 

 

 

 

1,300

 

 

(3,800

)

 

(8,400

)

 

3,400

 

 

(8,800

)

 

 

 

 

(6,500

)

 

(6,500

)

C&W Caribbean - Other

5,800

 

 

5,800

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

C&W Panama

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

18,700

 

 

18,700

 

VTR2

(4,292,100

)

 

(3,926,500

)

 

(1,311,500

)

 

(967,900

)

 

(1,171,800

)

 

(486,100

)

 

(2,625,800

)

 

 

(6,300

)

 

(257,900

)

 

(264,200

)

Total Q4 2022 Adjustments:

(4,286,300

)

 

(3,920,700

)

 

(1,310,200

)

 

(971,700

)

 

(1,180,200

)

 

(482,700

)

 

(2,634,600

)

 

 

(20,700

)

 

(245,700

)

 

(266,400

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Adds

(4,261,600

)

 

(3,896,100

)

 

(1,313,500

)

 

(976,200

)

 

(1,155,500

)

 

(471,600

)

 

(2,603,300

)

 

 

(19,900

)

 

(187,500

)

 

(207,400

)

1.

Included in Liberty Puerto Rico's mobile prepaid organic loss is a decrease of 3,300 mobile reseller subscribers.

2.

During October 2022, we contributed our Chilean operation into a joint venture with Claro Chile, which resulted in a non-organic adjustment that represents the removal of VTR from our consolidated subscriber balances.

ARPU per Customer Relationship

The following table provides ARPU per customer relationship for the indicated periods:

 

Three months ended December 31,

 

 

 

FX-Neutral1

 

2022

 

2021

 

% Change

 

% Change

 

 

 

 

 

 

 

 

Reportable Segment:

 

 

 

 

 

 

 

C&W Caribbean

$

48.81

 

$

48.13

 

1

%

 

1

%

C&W Panama

$

36.68

 

$

38.97

 

(6

%)

 

(6

%)

Liberty Puerto Rico

$

74.29

 

$

75.90

 

(2

%)

 

(2

%)

Liberty Costa Rica2

$

40.27

 

$

41.62

 

(3

%)

 

(8

%)

Cable & Wireless Borrowing Group

$

45.97

 

$

46.36

 

(1

%)

 

(1

%)

Mobile ARPU

The following table provides ARPU per mobile subscriber for the indicated periods:

 

Three months ended December 31,

 

 

 

FX-Neutral1

 

2022

 

2021

 

% Change

 

% Change

 

 

 

 

 

 

 

 

Reportable Segment:

 

 

 

 

 

 

 

C&W Caribbean

$

14.31

 

$

14.36

 

%

 

%

C&W Panama

$

9.97

 

$

8.73

 

14

%

 

14

%

Liberty Puerto Rico3

$

38.91

 

$

46.04

 

(15

%)

 

(15

%)

Liberty Costa Rica4

$

5.90

 

$

5.49

 

7

%

 

3

%

Cable & Wireless Borrowing Group

$

11.98

 

$

11.65

 

3

%

 

3

%

1.

The FX-Neutral change represents the percentage change on a year-over-year basis adjusted for FX impacts and is calculated by adjusting the current-period figures to reflect translation at the foreign currency rates used to translate the prior year amounts.

2.

The ARPU per customer relationship amounts in Costa Rican colones for the three months ended December 31, 2022 and 2021 were CRC 24,512 and CRC 26,495, respectively.

3.

The year-over-year decline in mobile ARPU was primarily driven by increased promotional activity on postpaid plans, an increase in lower ARPU data subscribers driven by a large Department of Education contract, and lower prepaid ARPU including the prepaid reseller channel.

4.

The mobile ARPU amount in Costa Rican colones for the three months ended December 31, 2022 and 2021 were CRC 3,597 and CRC 3,498, respectively.

Forward-Looking Statements and Disclaimer

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our strategies, priorities and objectives, performance, guidance and growth expectations for 2023; our digital strategy, product innovation and commercial plans and projects; subscriber growth; expectations on demand for connectivity in the region; our anticipated integration plans, synergies, opportunities and integration costs in Puerto Rico following the AT&T Acquisition, in Costa Rica following the acquisition of Telefónica's Costa Rica business and in Panama following the acquisition of América Móvil’s Panama operations; the strength of our balance sheet and tenor of our debt; our share repurchase program; and other information and statements that are not historical fact. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied by these statements. These risks and uncertainties include events that are outside of our control, such as hurricanes and other natural disasters, political or social events, and pandemics, such as COVID-19, the uncertainties surrounding such events, the ability and cost to restore networks in the markets impacted by hurricanes or generally to respond to any such events; the continued use by subscribers and potential subscribers of our services and their willingness to upgrade to our more advanced offerings; our ability to meet challenges from competition, to manage rapid technological change or to maintain or increase rates to our subscribers or to pass through increased costs to our subscribers; the effects of changes in laws or regulation; general economic factors; our ability to successfully acquire and integrate new businesses and realize anticipated efficiencies from acquired businesses; the availability of attractive programming for our video services and the costs associated with such programming; our ability to achieve forecasted financial and operating targets; the outcome of any pending or threatened litigation; the ability of our operating companies to access cash of their respective subsidiaries; the impact of our operating companies' future financial performance, or market conditions generally, on the availability, terms and deployment of capital; fluctuations in currency exchange and interest rates; the ability of suppliers and vendors to timely deliver quality products, equipment, software, services and access; our ability to adequately forecast and plan future network requirements including the costs and benefits associated with network expansions; and other factors detailed from time to time in our filings with the Securities and Exchange Commission, including our most recently filed Form 10-K. These forward-looking statements speak only as of the date of this press release. We expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

About Liberty Latin America

Liberty Latin America is a leading communications company operating in over 20 countries across Latin America and the Caribbean under the consumer brands BTC, Flow, Liberty and Más Móvil, and through ClaroVTR, our joint venture in Chile. The communications and entertainment services that we offer to our residential and business customers in the region include digital video, broadband internet, telephony and mobile services. Our business products and services include enterprise-grade connectivity, data center, hosting and managed solutions, as well as information technology solutions with customers ranging from small and medium enterprises to international companies and governmental agencies. In addition, Liberty Latin America operates a subsea and terrestrial fiber optic cable network that connects approximately 40 markets in the region.

Liberty Latin America has three separate classes of common shares, which are traded on the NASDAQ Global Select Market under the symbols “LILA” (Class A) and “LILAK” (Class C), and on the OTC link under the symbol “LILAB” (Class B).

For more information, please visit www.lla.com.

Footnotes

1.

Rebased growth rates are a non-GAAP measure. The indicated growth rates are rebased for the estimated impacts of (i) acquisitions and (ii) FX. See Non-GAAP Reconciliations below.

2.

We provide rebased revenue and Adjusted OIBDA growth rates, each a non-GAAP measure, for Liberty Latin America excluding VTR in light of the October deconsolidation of VTR that occurred in connection with the closing of our joint venture in Chile with América Móvil. See the tables below for the required non-GAAP reconciliations.

3.

Adjusted OIBDA is a non-GAAP measure. For the definition of Adjusted OIBDA and required reconciliations, see Non-GAAP Reconciliations below.

4.

Adjusted Free Cash Flow (“Adjusted FCF”) is a non-GAAP measure. For the definition of Adjusted FCF and required reconciliations, see Non-GAAP Reconciliations below.

5.

See Glossary for the definition of RGUs and mobile subscribers. Organic figures exclude RGUs and mobile subscribers of acquired entities at the date of acquisition and other non-organic adjustments, but include the impact of changes in RGUs and mobile subscribers from the date of acquisition. All subscriber / RGU additions or losses refer to net organic changes, unless otherwise noted.

Additional Information | Cable & Wireless Borrowing Group

The following tables reflect preliminary unaudited selected financial results, on a consolidated C&W basis, for the periods indicated, in accordance with U.S. GAAP.

 

Three months ended

 

 

 

 

 

December 31,

 

Change

 

Rebased

change1

 

2022

 

2021

 

 

 

in millions, except % amounts

 

 

 

 

 

 

 

 

Revenue

$

669.3

 

 

$

624.4

 

 

7

%

 

2

%

 

 

 

 

 

 

 

 

Operating income (loss)

$

77.1

 

 

$

(526.9

)

 

(115

%)

 

 

 

 

 

 

 

 

 

 

Adjusted OIBDA

$

275.0

 

 

$

258.8

 

 

6

%

 

6

%

 

 

 

 

 

 

 

 

Operating income (loss) as a percentage of revenue

 

11.5

%

 

 

(84.4

)%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted OIBDA as a percentage of revenue

 

41.1

%

 

 

41.4

%

 

 

 

 

 

 

 

 

 

 

 

 

Proportionate Adjusted OIBDA

$

231.7

 

 

$

215.6

 

 

 

 

 

 

 

Year ended

 

 

 

 

 

December 31,

 

Change

 

Rebased

change1

 

2022

 

2021

 

 

 

in millions, except % amounts

 

 

 

 

 

 

 

 

Revenue

$

2,448.6

 

 

$

2,310.6

 

 

6

%

 

4

%

 

 

 

 

 

 

 

 

Operating loss

$

(252.1

)

 

$

(340.0

)

 

(26

%)

 

 

 

 

 

 

 

 

 

 

Adjusted OIBDA

$

1,000.0

 

 

$

947.3

 

 

6

%

 

6

%

 

 

 

 

 

 

 

 

Operating loss as a percentage of revenue

 

(10.3

)%

 

 

(14.7

)%

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted OIBDA as a percentage of revenue

 

40.8

%

 

 

41.0

%

 

 

 

 

 

 

 

 

 

 

 

 

Proportionate Adjusted OIBDA

$

852.4

 

 

$

801.6

 

 

 

 

 

1.

Indicated growth rates are rebased for the estimated impacts of an acquisition and FX.

The following table details the U.S. dollar equivalent of the nominal amount outstanding of C&W's third-party debt and cash and cash equivalents:

 

 

 

December 31,

 

September 30,

 

Facility Amount

 

2022

 

2022

 

in millions

Credit Facilities:

 

 

 

 

 

Revolving Credit Facility due 2023 (LIBOR + 3.25%)

$

50.0

 

$

 

 

$

 

Revolving Credit Facility due 2027 (LIBOR + 3.25%)

$

580.0

 

 

 

 

 

 

Term Loan Facility B-5 due 2028 (LIBOR + 2.25%)

$

1,510.0

 

 

1,510.0

 

 

 

1,510.0

 

Term Loan Facility B-6 due 2029 (LIBOR + 3.00%)

$

590.0

 

 

590.0

 

 

 

590.0

 

Total Senior Secured Credit Facilities

 

 

2,100.0

 

 

 

2,100.0

 

Notes:

 

 

 

 

 

5.75% USD Senior Secured Notes due 2027

$

495.0

 

 

495.0

 

 

 

495.0

 

6.875% USD Senior Notes due 2027

$

1,220.0

 

 

1,220.0

 

 

 

1,220.0

 

Total Notes

 

 

1,715.0

 

 

 

1,715.0

 

Other debt:

 

 

 

 

 

4.25% CWP Term Loan due 2028

$

435.0

 

 

435.0

 

 

 

435.0

 

Other regional debt

 

 

70.2

 

 

 

83.1

 

Vendor financing

 

 

199.4

 

 

 

178.0

 

Total third-party debt

 

 

4,519.6

 

 

 

4,511.1

 

Less: premiums, discounts and deferred financing costs, net

 

 

(31.6

)

 

 

(33.3

)

Total carrying amount of third-party debt

 

 

4,488.0

 

 

 

4,477.8

 

Less: cash and cash equivalents

 

 

(536.2

)

 

 

(458.3

)

Net carrying amount of third-party debt

 

$

3,951.8

 

 

$

4,019.5

 

  • At December 31, 2022, our third-party total and proportionate net debt was $4.0 billion and $3.7 billion, respectively, our Fully-swapped Borrowing Cost was 5.1%, and the average tenor of our debt obligations (excluding vendor financing) was approximately 5.1 years.
  • Our portion of Adjusted OIBDA, after deducting the noncontrolling interests' share, (“Proportionate Adjusted OIBDA”) was $232 million for Q4 2022.
  • Based on Q4 results, our Proportionate Net Leverage Ratio was 4.0x, calculated in accordance with C&W's Credit Agreement. At December 31, 2022, we had maximum undrawn commitments of $719 million, including $89 million under our regional facilities. At December 31, 2022, the full amount of unused borrowing capacity under our credit facilities (including regional facilities) was available to be borrowed, both before and after completion of the December 31, 2022 compliance reporting requirements.

Liberty Puerto Rico (LPR) Borrowing Group

The following table details the nominal amount outstanding of Liberty Puerto Rico's debt, finance lease obligations and cash and cash equivalents:

 

 

 

December 31,

 

September 30,

 

Facility amount

 

2022

 

2022

 

in millions

 

 

 

 

 

 

Credit Facilities:

 

 

 

 

 

Revolving Credit Facility due 2027 (LIBOR + 3.50%)

$

172.5

 

$

 

 

$

 

Term Loan Facility due 2028 (LIBOR + 3.75%)

$

620.0

 

 

620.0

 

 

 

620.0

 

Total Senior Secured Credit Facilities

 

 

620.0

 

 

 

620.0

 

Notes:

 

 

 

 

 

6.75% Senior Secured Notes due 2027

$

1,161.0

 

 

1,161.0

 

 

 

1,161.0

 

5.125% Senior Secured Notes due 2029

$

820.0

 

 

820.0

 

 

 

820.0

 

Total Notes

 

 

1,981.0

 

 

 

1,981.0

 

Vendor financing

 

 

16.7

 

 

 

 

Finance lease obligations

 

 

5.7

 

 

 

6.1

 

Total debt and finance lease obligations

 

 

2,623.4

 

 

 

2,607.1

 

Less: discounts and deferred financing costs, net

 

 

(28.6

)

 

 

(29.6

)

Total carrying amount of debt

 

 

2,594.8

 

 

 

2,577.5

 

Less: cash and cash equivalents

 

 

(72.3

)

 

 

(118.2

)

Net carrying amount of debt

 

$

2,522.5

 

 

$

2,459.3

 

  • At December 31, 2022, our Fully-swapped Borrowing Cost was 6.1% and the average tenor of our debt was approximately 5.6 years.
  • Based on our results for Q4 2022, and subject to the completion of the corresponding compliance reporting requirements, our Consolidated Net Leverage Ratio was 4.5x, calculated in accordance with LPR’s Group Credit Agreement.
  • At December 31, 2022, we had maximum undrawn commitments of $173 million. At December 31, 2022, the full amount of unused borrowing capacity under our revolving credit facility was available to be borrowed, both before and after completion of the December 31, 2022 compliance reporting requirements.

Liberty Costa Rica Borrowing Group

The following table details the borrowing currency and Costa Rican colón equivalent of the nominal amount outstanding of Liberty Costa Rica's debt and cash and cash equivalents:

 

December 31,

 

September 30,

 

2022

 

2022

 

Borrowing

currency in

millions

 

CRC equivalent in billions

 

 

 

 

 

 

 

Term Loan B-1 Facility due 20241 (LIBOR + 5.50%)

$

276.7

 

163.8

 

 

173.9

 

Term Loan B-2 Facility due 20241 (TBP2 + 6.75%)

CRC

79,635.2

 

79.6

 

 

79.6

 

Revolving Credit Facility due 2024 (LIBOR + 4.25%)

$

15.0

 

4.7

 

 

5.0

 

Total credit facilities

 

248.1

 

 

258.5

 

Other

 

3.6

 

 

10.5

 

Finance lease obligations

 

1.7

 

 

1.9

 

Total debt and finance lease obligations

 

253.4

 

 

270.9

 

Less: discounts and deferred financing costs

 

(3.3

)

 

(4.5

)

Total carrying amount of debt

 

250.1

 

 

266.4

 

Less: cash and cash equivalents

 

(9.5

)

 

(4.3

)

Net carrying amount of debt

 

240.6

 

 

262.1

 

 

 

 

 

 

 

 

Exchange rate (CRC to $)

 

591.8

 

 

628.5

 

1.

Under the terms of the credit agreement, Liberty Costa Rica was obligated to repay 50% of the outstanding aggregate principal amounts of the LCR Term Loan B-1 Facility and the LCR Term Loan B-2 Facility on February 1, 2024, with the remaining respective principal amounts due on August 1, 2024, which represented the ultimate maturity date of the facilities.

2.

Tasa Básica Pasiva rate.

  • In January 2023, Liberty Costa Rica entered into the 2031 LCR Term Loan A and the 2031 LCR Term Loan B, both issued at par. The proceeds from the 2031 LCR Term Loan A and 2031 LCR Term Loan B were primarily used to repay the LCR Term Loan B-1 Facility and LCR Term Loan B-2 Facility.
  • In January 2023, the LCR Revolving Credit Facility was amended and restated. The amended and restated $60 million LCR Revolving Credit Facility bears interest at SOFR plus a margin of 4.25% and matures on January 15, 2028.

Subscriber Table

 

Consolidated Operating Data — December 31, 2022

 

Homes

Passed

 

Two-way

Homes

Passed

 

Fixed-line

Customer

Relationships

 

Video RGUs

 

Internet

RGUs

 

Telephony

RGUs

 

Total

RGUs

 

 

Prepaid

 

Postpaid

 

Total Mobile

Subscribers

 

 

 

 

 

C&W Caribbean:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Jamaica

685,700

 

685,700

 

331,800

 

132,000

 

308,200

 

300,900

 

741,100

 

 

1,120,000

 

73,700

 

1,193,700

The Bahamas

120,900

 

120,900

 

35,900

 

5,600

 

23,100

 

33,600

 

62,300

 

 

146,400

 

24,000

 

170,400

Trinidad and Tobago

340,900

 

340,900

 

155,600

 

101,800

 

140,300

 

94,200

 

336,300

 

 

 

 

Barbados

140,400

 

140,400

 

84,300

 

38,000

 

75,700

 

70,300

 

184,000

 

 

87,600

 

40,400

 

128,000

Other

336,000

 

316,100

 

215,100

 

74,400

 

187,200

 

115,000

 

376,600

 

 

333,200

 

100,100

 

433,300

Total C&W Caribbean

1,623,900

 

1,604,000

 

822,700

 

351,800

 

734,500

 

614,000

 

1,700,300

 

 

1,687,200

 

238,200

 

1,925,400

C&W Panama

829,200

 

829,200

 

251,700

 

159,300

 

207,400

 

199,900

 

566,600

 

 

1,820,700

 

358,200

 

2,178,900

Total C&W

2,453,100

 

2,433,200

 

1,074,400

 

511,100

 

941,900

 

813,900

 

2,266,900

 

 

3,507,900

 

596,400

 

4,104,300

Liberty Puerto Rico 1,2

1,173,600

 

1,173,600

 

551,100

 

242,800

 

524,000

 

257,400

 

1,024,200

 

 

182,300

 

903,300

 

1,085,600

Liberty Costa Rica 3

700,300

 

694,400

 

299,200

 

204,800

 

268,200

 

55,400

 

528,400

 

 

2,162,400

 

817,200

 

2,979,600

Total

4,327,000

 

4,301,200

 

1,924,700

 

958,700

 

1,734,100

 

1,126,700

 

3,819,500

 

 

5,852,600

 

2,316,900

 

8,169,500

1.

Prepaid mobile subscribers include 52,200 mobile reseller subscribers.

2.

Postpaid mobile subscribers include 206,700 CRUs.

3.

Our homes passed in Liberty Costa Rica include 57,000 homes on a third-party network that provides us long-term access.

Glossary

Adjusted OIBDA Margin – Calculated by dividing Adjusted OIBDA by total revenue for the applicable period.

ARPU – Average revenue per unit refers to the average monthly subscription revenue (subscription revenue excludes interconnect, mobile handset sales and late fees) per average customer relationship or mobile subscriber, as applicable. ARPU per average customer relationship is calculated by dividing the average monthly subscription revenue from residential fixed and SOHO fixed services by the average of the opening and closing balances for customer relationships for the indicated period. ARPU per average mobile subscriber is calculated by dividing the average monthly mobile service revenue by the average of the opening and closing balances for mobile subscribers for the indicated period. Unless otherwise indicated, ARPU per customer relationship or mobile subscriber is not adjusted for currency impacts. ARPU per average RGU is calculated by dividing the average monthly subscription revenue from the applicable residential fixed service by the average of the opening and closing balances of the applicable RGUs for the indicated period. Unless otherwise noted, ARPU in this release is considered to be ARPU per average customer relationship or mobile subscriber, as applicable. Customer relationships, mobile subscribers and RGUs of entities acquired during the period are normalized.

Consolidated Debt and Finance Lease Obligations to Operating Income Ratio – Defined as total principal amount of debt and finance lease obligations outstanding to annualized operating income from the most recent two consecutive fiscal quarters.

Consolidated Net Debt and Finance Lease Obligations to Operating Income Ratio – Defined as total principal amount of debt and finance lease obligations outstanding less cash and cash equivalents to annualized operating income from the most recent two consecutive fiscal quarters.

Consolidated Net Leverage Ratio (LPR) Defined in accordance with LPR's Group Credit Agreement, taking into account the ratio of its outstanding indebtedness less its cash and cash equivalents to its annualized EBITDA from the most recent two consecutive fiscal quarters.

CRU – Corporate responsible user.

Customer Relationships – The number of customers who receive at least one of our video, internet or telephony services that we count as RGUs, without regard to which or to how many services they subscribe. To the extent that RGU counts include equivalent billing unit (“EBU”) adjustments, we reflect corresponding adjustments to our customer relationship counts. For further information regarding our EBU calculation, see Additional General Notes below. Customer relationships generally are counted on a unique premises basis. Accordingly, if an individual receives our services in two premises (e.g., a primary home and a vacation home), that individual generally will count as two customer relationships. We exclude mobile-only customers from customer relationships.

Fully-swapped Borrowing Cost – Represents the weighted average interest rate on our debt (excluding finance leases and including vendor financing obligations), including the effects of derivative instruments, original issue premiums or discounts, which includes a discount on the convertible notes issued by Liberty Latin America associated with a conversion option feature, and commitment fees, but excluding the impact of financing costs.

Homes Passed – Homes, residential multiple dwelling units or commercial units that can be connected to our networks without materially extending the distribution plant. Certain of our homes passed counts are based on census data that can change based on either revisions to the data or from new census results.

Internet (Broadband) RGU – A home, residential multiple dwelling unit or commercial unit that receives internet services over our network.

Leverage – Our gross and net leverage ratios, each a non-GAAP measure, are defined as total debt (total principal amount of debt and finance lease obligations outstanding, net of projected derivative principal-related cash payments (receipts)) and net debt to annualized Adjusted OIBDA of the latest two quarters. Net debt is defined as total debt (including the convertible notes) less cash and cash equivalents. For purposes of these calculations, debt is measured using swapped foreign currency rates, consistent with the covenant calculation requirements of our subsidiary debt agreements.

Mobile Subscribers – Our mobile subscriber count represents the number of active subscriber identification module (“SIM”) cards in service rather than services provided. For example, if a mobile subscriber has both a data and voice plan on a smartphone this would equate to one mobile subscriber. Alternatively, a subscriber who has a voice and data plan for a mobile handset and a data plan for a laptop (via a dongle) would be counted as two mobile subscribers. Customers who do not pay a recurring monthly fee are excluded from our mobile telephony subscriber counts after periods of inactivity ranging from 30 to 90 days, based on industry standards within the respective country. In a number of countries, our mobile subscribers receive mobile services pursuant to prepaid contracts. Our Liberty Puerto Rico segment prepaid subscriber count includes mobile reseller subscribers, which represent organizations that purchase minutes and data at wholesale prices and subsequently resell it under the purchaser's brand name. These reseller subscribers result in a significantly lower ARPU than the remaining subscribers included in our prepaid balance. Additionally, our Liberty Puerto Rico segment postpaid subscriber count includes CRUs, which represent an individual receiving mobile services through an organization that has entered into a contract for mobile services with us and where the organization is responsible for the payment of the CRU’s mobile services.

NPS – Net promoter score.

Property and Equipment Addition Categories

  • Customer Premises Equipment: Includes capitalizable equipment and labor, materials and other costs directly associated with the installation of such CPE;
  • New Build & Upgrade: Includes capitalizable costs of network equipment, materials, labor and other costs directly associated with entering a new service area and upgrading our existing network;
  • Capacity: Includes capitalizable costs for network capacity required for growth and services expansions from both existing and new customers. This category covers Core and Access parts of the network and includes, for example, fiber node splits, upstream/downstream spectrum upgrades and optical equipment additions in our international backbone connections;
  • Baseline: Includes capitalizable costs of equipment, materials, labor and other costs directly associated with maintaining and supporting the business. Relates to areas such as network improvement, property and facilities, technical sites, information technology systems and fleet; and
  • Product & Enablers: Discretionary capitalizable costs that include investments (i) required to support, maintain, launch or innovate in new customer products, and (ii) in infrastructure, which drive operational efficiency over the long term.

Proportionate Net Leverage Ratio (C&W) – Calculated in accordance with C&W's Credit Agreement, taking into account the ratio of outstanding indebtedness (subject to certain exclusions) less cash and cash equivalents to EBITDA (subject to certain adjustments) for the last two quarters annualized, with both indebtedness and EBITDA reduced proportionately to remove any noncontrolling interests' share of the C&W group.

Revenue Generating Unit (RGU) – RGU is separately a video RGU, internet RGU or telephony RGU. A home, residential multiple dwelling unit, or commercial unit may contain one or more RGUs. For example, if a residential customer in Puerto Rico subscribed to our video service, fixed-line telephony service and broadband internet service, the customer would constitute three RGUs. RGUs are generally counted on a unique premises basis such that a given premises does not count as more than one RGU for any given service. On the other hand, if an individual receives one of our services in two premises (e.g., a primary home and a vacation home), that individual will count as two RGUs for that service. Each bundled video, internet or telephony service is counted as a separate RGU regardless of the nature of any bundling discount or promotion. Non-paying subscribers are counted as RGUs during their free promotional service period. Some of these subscribers may choose to disconnect after their free service period. Services offered without charge on a long-term basis (e.g., VIP subscribers or free service to employees) generally are not counted as RGUs. We do not include subscriptions to mobile services in our externally reported RGU counts. In this regard, our RGU counts exclude our separately reported postpaid and prepaid mobile subscribers.

SOHO – Small office/home office customers.

Telephony RGU – A home, residential multiple dwelling unit or commercial unit that receives voice services over our network. Telephony RGUs exclude mobile subscribers.

Two-way Homes Passed – Homes passed by those sections of our networks that are technologically capable of providing two-way services, including video, internet and telephony services.

U.S. GAAP – Generally accepted accounting principles in the United States.

Video RGU – A home, residential multiple dwelling unit or commercial unit that receives our video service over our network primarily via a digital video signal while subscribing to any recurring monthly service that requires the use of encryption-enabling technology. Video RGUs that are not counted on an EBU basis are generally counted on a unique premises basis. For example, a subscriber with one or more set-top boxes that receives our video service in one premises is generally counted as just one RGU.

Additional General Notes

Most of our operations provide telephony, broadband internet, mobile data, video or other B2B services. Certain of our B2B service revenue is derived from SOHO customers that pay a premium price to receive enhanced service levels along with video, internet or telephony services that are the same or similar to the mass marketed products offered to our residential subscribers. All mass marketed products provided to SOHO customers, whether or not accompanied by enhanced service levels and/or premium prices, are included in the respective RGU and customer counts of our operations, with only those services provided at premium prices considered to be “SOHO RGUs” or “SOHO customers.” To the extent our existing customers upgrade from a residential product offering to a SOHO product offering, the number of SOHO RGUs and SOHO customers will increase, but there is no impact to our total RGU or customer counts. With the exception of our B2B SOHO customers, we generally do not count customers of B2B services as customers or RGUs for external reporting purposes.

Certain of our residential and commercial RGUs are counted on an EBU basis, including residential multiple dwelling units and commercial establishments, such as bars, hotels, and hospitals, in Puerto Rico. Our EBUs are generally calculated by dividing the bulk price charged to accounts in an area by the most prevalent price charged to non-bulk residential customers in that market for the comparable tier of service. As such, we may experience variances in our EBU counts solely as a result of changes in rates.

While we take appropriate steps to ensure that subscriber and homes passed statistics are presented on a consistent and accurate basis at any given balance sheet date, the variability from country to country in (i) the nature and pricing of products and services, (ii) the distribution platform, (iii) billing systems, (iv) bad debt collection experience and (v) other factors add complexity to the subscriber and homes passed counting process. We periodically review our subscriber and homes passed counting policies and underlying systems to improve the accuracy and consistency of the data reported on a prospective basis. Accordingly, we may from time to time make appropriate adjustments to our subscriber and homes passed statistics based on those reviews.

Non-GAAP Reconciliations

We include certain financial measures in this press release that are considered non-GAAP measures, including (i) Adjusted OIBDA, Adjusted OIBDA Margin and Adjusted OIBDA less P&E Additions, (ii) Adjusted Free Cash Flow, (iii) rebased revenue and rebased Adjusted OIBDA growth rates, and (iv) consolidated leverage ratios. The following sections set forth reconciliations of the nearest GAAP measure to our non-GAAP measures as well as information on how and why management of the Company believes such information is useful to an investor.

Adjusted OIBDA and Adjusted OIBDA less P&E Additions

Adjusted OIBDA and Adjusted OIBDA less P&E Additions, each a non-GAAP measure, are the primary measures used by our chief operating decision maker to evaluate segment operating performance. Adjusted OIBDA and Adjusted OIBDA less P&E Additions are also key factors that are used by our internal decision makers to determine how to allocate resources to segments. As we use the term, Adjusted OIBDA is defined as operating income or loss before share-based compensation, depreciation and amortization, provisions and provision releases related to significant litigation and impairment, restructuring and other operating items. Other operating items include (i) gains and losses on the disposition of long-lived assets, (ii) third-party costs directly associated with successful and unsuccessful acquisitions and dispositions, including legal, advisory and due diligence fees, as applicable, and (iii) other acquisition-related items, such as gains and losses on the settlement of contingent consideration. Our internal decision makers believe Adjusted OIBDA and Adjusted OIBDA less P&E Additions are meaningful measures because they represent a transparent view of our recurring operating performance that is unaffected by our capital structure and allows management to (i) readily view operating trends, (ii) perform analytical comparisons and benchmarking between segments and (iii) identify strategies to improve operating performance in the different countries in which we operate. We believe our Adjusted OIBDA and Adjusted OIBDA less P&E Additions measures are useful to investors because they are one of the bases for comparing our performance with the performance of other companies in the same or similar industries, although our measures may not be directly comparable to similar measures used by other public companies. Adjusted OIBDA and Adjusted OIBDA less P&E Additions should be viewed as measures of operating performance that are a supplement to, and not a substitute for, operating income or loss, net earnings or loss and other U.S. GAAP measures of income. A reconciliation of our operating income or loss to total Adjusted OIBDA and Adjusted OIBDA less P&E Additions are presented in the following table:

 

Three months ended

 

Year ended

 

December 31,

 

December 31,

 

2022

 

2021

 

2022

 

2021

 

in millions

 

 

 

 

 

Operating income (loss)

$

109.5

 

$

(417.7

)

$

94.1

 

$

67.3

 

Share-based compensation expense

 

10.9

 

 

29.2

 

 

93.5

 

 

118.1

 

Depreciation and amortization

 

249.0

 

 

228.4

 

 

910.7

 

 

964.7

 

Impairment, restructuring and other operating items, net

 

35.8

 

 

623.7

 

 

619.2

 

 

665.0

 

Adjusted OIBDA

 

405.2

 

 

463.6

 

 

1,717.5

 

 

1,815.1

 

Less: Property and equipment additions

 

225.2

 

 

256.9

 

 

816.3

 

 

855.9

 

Adjusted OIBDA less P&E additions

$

180.0

 

$

206.7

 

$

901.2

 

$

959.2

 

 

Operating income (loss) margin1

 

9.4

%

 

(32.6

)%

 

2.0

%

 

1.4

%

 

 

 

 

 

Adjusted OIBDA margin2

 

34.9

%

 

36.2

%

 

35.7

%

 

37.7

%

1.

Calculated by dividing operating income (loss) by total revenue for the applicable period.

2.

Calculated by dividing Adjusted OIBDA by total revenue for the applicable period.

Adjusted Free Cash Flow Definition and Reconciliation

We define Adjusted Free Cash Flow (Adjusted FCF), a non-GAAP measure, as net cash provided by our operating activities, plus (i) cash payments for third-party costs directly associated with successful and unsuccessful acquisitions and dispositions, (ii) expenses financed by an intermediary, (iii) insurance recoveries related to damaged and destroyed property and equipment and (iv) certain net interest payments or receipts incurred or received, including associated derivative instrument payments and receipts, in advance of a significant acquisition, less (a) capital expenditures, net, (b) principal payments on amounts financed by vendors and intermediaries, (c) principal payments on finance leases, and (d) distributions to noncontrolling interest owners. We believe that our presentation of Adjusted FCF provides useful information to our investors because this measure can be used to gauge our ability to service debt and fund new investment opportunities. Adjusted FCF should not be understood to represent our ability to fund discretionary amounts, as we have various mandatory and contractual obligations, including debt repayments, which are not deducted to arrive at this amount. Investors should view Adjusted FCF as a supplement to, and not a substitute for, U.S. GAAP measures of liquidity included in our consolidated statements of cash flows.

The following table provides the reconciliation of our net cash provided by operating activities to Adjusted FCF for the indicated period:

 

Three months ended

 

Year ended

 

December 31,

 

December 31,

 

2022

 

2021

 

2022

 

2021

 

in millions

 

 

 

 

 

 

 

 

Net cash provided by operating activities

$

377.0

 

 

$

298.4

 

 

$

868.8

 

 

$

1,016.2

 

Cash payments for direct acquisition and disposition costs

 

8.1

 

 

 

12.3

 

 

 

26.5

 

 

 

34.4

 

Expenses financed by an intermediary1

 

33.4

 

 

 

28.1

 

 

 

149.1

 

 

 

110.0

 

Capital expenditures, net

 

(166.0

)

 

 

(191.6

)

 

 

(660.1

)

 

 

(736.3

)

Principal payments on amounts financed by vendors and intermediaries

 

(42.6

)

 

 

(47.0

)

 

 

(196.7

)

 

 

(184.0

)

Pre-acquisition interest payments, net2

 

 

 

 

 

 

 

3.9

 

 

 

11.2

 

Principal payments on finance leases

 

(0.2

)

 

 

(2.6

)

 

 

(1.1

)

 

 

(4.1

)

Adjusted FCF before distributions to noncontrolling interest owners

 

209.7

 

 

 

97.6

 

 

 

190.4

 

 

 

247.4

 

Distributions to noncontrolling interest owners

 

 

 

 

(46.3

)

 

 

(1.9

)

 

 

(47.6

)

Adjusted FCF

$

209.7

 

 

$

51.3

 

 

$

188.5

 

 

$

199.8

 

1.

For purposes of our consolidated statements of cash flows, expenses, including value-added taxes, financed by an intermediary are treated as operating cash outflows and financing cash inflows when the expenses are incurred. When we pay the financing intermediary, we record financing cash outflows in our consolidated statements of cash flows. For purposes of our Adjusted FCF definition, we add back the operating cash outflows when these financed expenses are incurred and deduct the financing cash outflows when we pay the financing intermediary.

2.

The amount for the year ended December 31, 2022 reflects the portion of interest paid that relates to the pre-acquisition debt for the Claro Panama Acquisition. The amount for the year ended December 31, 2021 relates to (i) the LCR Term Loan B-1 Facility and LCR Term Loan B-2 Facility that were entered into in advance of the Telefónica Costa Rica Acquisition and (ii) the portion of interest paid in April 2021 that relates to pre-acquisition debt for the AT&T Acquisition.

Rebase Information

Rebase growth rates are a non-GAAP measure. For purposes of calculating rebased growth rates on a comparable basis for all businesses that we owned during the current year, we have adjusted our historical revenue and Adjusted OIBDA to include or exclude the pre-acquisition amounts of acquired or disposed business, as applicable, to the same extent they are included or excluded from the current year. The businesses that were acquired or disposed impacting the comparative periods are as follows:

i.

Telefónica Costa Rica, which was acquired on August 9, 2021;

ii.

Broadband VI, LLC, which was acquired effective December 31, 2021;

iii.

Claro Panama, which was acquired on July 1, 2022; and

iv.

VTR, which was disposed of on October 6, 2022.

In addition, we reflect the translation of our rebased amounts for the prior-year periods at the applicable average foreign currency exchange rates that were used to translate our results for the corresponding current-year periods.

We have reflected the revenue and Adjusted OIBDA of acquired entities in our prior-year rebased amounts based on what we believe to be the most reliable information that is currently available to us (generally pre-acquisition financial statements), as adjusted for the estimated effects of (a) any significant differences between U.S. GAAP and local generally accepted accounting principles, (b) any significant effects of acquisition accounting adjustments, (c) any significant differences between our accounting policies and those of the acquired entities and (d) other items we deem appropriate. We do not adjust pre-acquisition periods to eliminate nonrecurring items or to give retroactive effect to any changes in estimates that might be implemented during post-acquisition periods. As we did not own or operate the acquired entities during the pre-acquisition periods, no assurance can be given that we have identified all adjustments necessary to present their revenue and Adjusted OIBDA on a basis that is comparable to the corresponding post-acquisition amounts that are included in our historical results or that the pre-acquisition financial statements we have relied upon do not contain undetected errors. In addition, the rebased growth percentages are not necessarily indicative of the revenue and Adjusted OIBDA that would have occurred if these transactions had occurred on the dates assumed for purposes of calculating our rebased amounts or the revenue and Adjusted OIBDA that will occur in the future. The rebased growth percentages have been presented as a basis for assessing growth rates on a comparable basis and should be viewed as measures of operating performance that are a supplement to, and not a substitute for, U.S. GAAP reported growth rates.

The following tables provide the aforementioned adjustments made to the revenue and Adjusted OIBDA amounts for the periods indicated, to derive our rebased growth rates. Due to rounding, certain rebased growth rate percentages may not recalculate.

In the tables set forth below:

  • reported percentage changes are calculated as current period measure, as applicable, less prior-period measure divided by prior-period measure; and
  • rebased percentage changes are calculated as current period measure, as applicable, less rebased prior-period measure divided by rebased prior-period measure.

The following tables set forth the reconciliations from reported revenue to rebased revenue and related change calculations.

 

Three months ended December 31, 2021

 

C&W

Caribbean

 

C&W

Panama

 

C&W Network

& LatAm

 

Liberty

Puerto Rico

 

Liberty

Costa Rica

 

VTR

 

Corporate

 

Intersegment

eliminations

 

Total

 

In millions

 

 

 

 

 

 

 

 

 

 

Revenue – Reported

$

356.9

 

$

173.6

 

$

111.9

 

$

371.2

 

$

108.2

 

$

174.8

 

$

5.4

 

$

(21.4

)

$

1,280.6

 

Rebase adjustments:

 

 

 

 

 

 

 

 

 

Acquisitions

 

 

 

33.9

 

 

 

 

2.9

 

 

 

 

 

 

 

 

 

 

36.8

 

Disposition

 

 

 

 

 

 

 

 

 

 

 

(174.8

)

 

 

 

 

 

(174.8

)

Foreign currency

 

0.2

 

 

 

 

(3.5

)

 

 

 

4.8

 

 

 

 

 

 

 

 

1.5

 

Revenue – Rebased

$

357.1

 

$

207.5

 

$

108.4

 

$

374.1

 

$

113.0

 

$

 

$

5.4

 

$

(21.4

)

$

1,144.1

 

Reported percentage change

 

3

%

 

16

%

 

11

%

 

1

%

 

8

%

N.M.

 

6

%

N.M.

 

(9

)%

 

 

 

 

 

 

 

 

 

 

Rebased percentage change

 

3

%

 

(3

)%

 

14

%

 

%

 

3

%

N.M.

 

6

%

N.M.

 

1

%

N.M. – Not Meaningful.

 

Year ended December 31, 2021

 

C&W

Caribbean

C&W

Panama

C&W Networks

& LatAm

Liberty

Puerto Rico

Liberty

Costa Rica

VTR

Corporate

Intersegment

eliminations

Total

 

In millions

 

 

 

 

 

 

 

 

 

 

Revenue – Reported

$

1,389.9

 

$

568.1

 

$

431.9

 

$

1,449.7

 

$

258.5

 

$

787.5

 

$

21.6

 

$

(92.4

)

$

4,814.8

 

Rebase adjustments:

 

 

 

 

 

 

 

 

 

Acquisitions

 

 

 

69.4

 

 

 

 

11.7

 

 

169.5

 

 

 

 

 

 

 

 

250.6

 

Disposition

 

 

 

 

 

 

 

 

 

 

 

(174.8

)

 

 

 

 

 

(174.8

)

Foreign currency

 

(7.2

)

 

 

 

(8.6

)

 

 

 

(15.9

)

 

(85.6

)

 

 

 

(0.1

)

 

(117.4

)

Revenue – Rebased

$

1,382.7

 

$

637.5

 

$

423.3

 

$

1,461.4

 

$

412.1

 

$

527.1

 

$

21.6

 

$

(92.5

)

$

4,773.2

 

Reported percentage change

 

3

%

 

13

%

 

4

%

 

1

%

 

71

%

 

(43

) %

 

3

%

N.M.

 

%

 

 

 

 

 

 

 

 

 

 

Rebased percentage change

 

4

%

 

1

%

 

7

%

 

1

%

 

7

%

 

(15

) %

 

3

%

N.M.

 

1

%

N.M. – Not Meaningful.

The following tables set forth the reconciliations from reported Adjusted OIBDA to rebased Adjusted OIBDA and related change calculations.

 

Three months ended December 31, 2021

 

C&W

Caribbean

 

C&W

Panama

 

C&W Networks

& LatAm

 

Liberty

Puerto Rico

 

Liberty

Costa Rica

 

VTR

 

 

Corporate

 

Total

 

In millions

 

 

 

 

 

 

 

 

 

Adjusted OIBDA – Reported

$

125.0

 

$

62.6

 

$

71.2

 

$

135.3

 

$

29.4

 

$

55.3

 

$

(15.2

)

$

463.6

 

Rebase adjustments:

 

 

 

 

 

 

 

 

Acquisitions

 

 

 

0.9

 

 

 

 

0.2

 

 

 

 

 

 

 

 

1.1

 

Disposition

 

 

 

 

 

 

 

 

 

 

 

(55.3

)

 

 

 

(55.3

)

Foreign currency

 

0.1

 

 

 

 

(0.7

)

 

 

 

1.4

 

 

 

 

 

 

0.8

 

Adjusted OIBDA – Rebased

$

125.1

 

$

63.5

 

$

70.5

 

$

135.5

 

$

30.8

 

$

 

$

(15.2

)

$

410.2

 

 

 

 

 

 

 

 

 

 

Reported percentage change

 

10

%

 

(9

) %

 

12

%

 

(11

) %

 

23

%

N.M.

 

(72

) %

 

(13

) %

 

 

 

 

 

 

 

 

 

Rebased percentage change

 

10

%

 

(10

) %

 

13

%

 

(11

) %

 

17

%

N.M.

 

(72

) %

 

(1

) %

N.M. – Not Meaningful.

 

Year ended December 31, 2021

 

C&W

Caribbean

 

C&W

Panama

 

C&W Networks

& LatAm

 

Liberty

Puerto Rico

 

Liberty

Costa Rica

 

VTR

 

Corporate

 

Total

 

In millions

 

 

 

 

 

 

 

 

 

Adjusted OIBDA – Reported

$

482.9

 

$

200.1

 

$

264.3

 

$

580.9

 

$

80.2

 

$

259.6

 

$

(52.9

)

$

1,815.1

 

Rebase adjustments:

 

 

 

 

 

 

 

 

Acquisitions

 

 

 

2.3

 

 

 

 

1.1

 

 

47.5

 

 

 

 

 

 

50.9

 

Disposition

 

 

 

 

 

 

 

 

 

 

 

(55.3

)

 

 

 

(55.3

)

Foreign currency

 

(2.7

)

 

 

 

(2.1

)

 

 

 

(5.3

)

 

(28.7

)

 

 

 

(38.8

)

Adjusted OIBDA – Rebased

$

480.2

 

$

202.4

 

$

262.2

 

$

582.0

 

$

122.4

 

$

175.6

 

$

(52.9

)

$

1,771.9

 

Reported percentage change

 

11

%

 

(6

) %

 

5

%

 

(7

) %

 

68

%

 

(55

) %

 

(35

) %

 

(5

) %

 

 

 

 

 

 

 

 

 

Rebased percentage change

 

11

%

 

(7

) %

 

5

%

 

(8

) %

 

10

%

 

(34

) %

 

(35

) %

 

(3

) %

The following tables set forth the reconciliations from reported revenue by product for our C&W Caribbean segment to rebased revenue by product and related change calculations.

 

Three months ended December 31, 2021

 

Residential

fixed

revenue

 

Residential

mobile

revenue

 

Total

residential

revenue

 

B2B revenue

 

Total

revenue

 

In millions

 

 

 

 

 

 

 

 

 

 

Revenue by product – Reported

$

128.4

 

 

$

96.2

 

 

$

224.6

 

 

$

132.3

 

 

$

356.9

 

Rebase adjustment:

 

 

 

 

 

 

 

 

 

Foreign currency

 

0.1

 

 

 

0.1

 

 

 

0.2

 

 

 

 

 

 

0.2

 

Revenue by product – Rebased

$

128.5

 

 

$

96.3

 

 

$

224.8

 

 

$

132.3

 

 

$

357.1

 

 

 

 

 

 

 

 

 

 

 

Reported percentage change

 

%

 

 

5

%

 

 

2

%

 

 

4

%

 

 

3

%

 

 

 

 

 

 

 

 

 

 

Rebased percentage change

 

%

 

 

5

%

 

 

2

%

 

 

4

%

 

 

3

%

 

 

Year ended December 31, 2021

 

Residential

fixed

revenue

 

Residential

mobile

revenue

 

Total

residential

revenue

 

B2B revenue

 

Total

revenue

 

In millions

 

 

 

 

 

 

 

 

 

 

Revenue by product – Reported

$

508.0

 

 

$

364.1

 

 

$

872.1

 

 

$

517.8

 

 

$

1,389.9

 

Rebase adjustment:

 

 

 

 

 

 

 

 

 

Foreign currency

 

(2.3

)

 

 

(1.7

)

 

 

(4.0

)

 

 

(3.2

)

 

 

(7.2

)

Revenue by product – Rebased

$

505.7

 

 

$

362.4

 

 

$

868.1

 

 

$

514.6

 

 

$

1,382.7

 

 

 

 

 

 

 

 

 

 

 

Reported percentage change

 

2

%

 

 

5

%

 

 

3

%

 

 

4

%

 

 

3

%

 

 

 

 

 

 

 

 

 

 

Rebased percentage change

 

2

%

 

 

6

%

 

 

4

%

 

 

4

%

 

 

4

%

The following tables set forth the reconciliations from reported revenue by product for our C&W Panama segment to rebased revenue by product and related change calculations.

 

Three months ended December 31, 2021

 

Residential

fixed

revenue

 

Residential

mobile

revenue

 

Total

residential

revenue

 

B2B revenue

 

Total

revenue

 

In millions

 

 

 

 

 

 

 

 

 

 

Revenue by product – Reported

$

25.5

 

 

$

54.9

 

 

$

80.4

 

 

$

93.2

 

 

$

173.6

 

Rebase adjustment:

 

 

 

 

 

 

 

 

 

Acquisition

 

2.2

 

 

 

25.5

 

 

 

27.7

 

 

 

6.2

 

 

 

33.9

 

Revenue by product – Rebased

$

27.7

 

 

$

80.4

 

 

$

108.1

 

 

$

99.4

 

 

$

207.5

 

 

 

 

 

 

 

 

 

 

 

Reported percentage change

 

15

%

 

 

45

%

 

 

35

%

 

 

(1

) %

 

 

16

%

 

 

 

 

 

 

 

 

 

 

Rebased percentage change

 

5

%

 

 

(1

) %

 

 

1

%

 

 

(7

) %

 

 

(3

) %

 

 

Year ended December 31, 2021

 

Residential

fixed

revenue

 

Residential

mobile

revenue

 

Total

residential

revenue

 

B2B revenue

 

Total

revenue

 

In millions

 

 

 

 

 

 

 

 

 

 

Revenue by product – Reported

$

97.4

 

 

$

220.9

 

 

$

318.3

 

 

$

249.8

 

 

$

568.1

 

Rebase adjustment:

 

 

 

 

 

 

 

 

 

Acquisition

 

4.3

 

 

 

52.0

 

 

 

56.3

 

 

 

13.1

 

 

 

69.4

 

Revenue by product – Rebased

$

101.7

 

 

$

272.9

 

 

$

374.6

 

 

$

262.9

 

 

$

637.5

 

 

 

 

 

 

 

 

 

 

 

Reported percentage change

 

13

%

 

 

21

%

 

 

19

%

 

 

6

%

 

 

13

%

 

 

 

 

 

 

 

 

 

 

Rebased percentage change

 

8

%

 

 

(2

)%

 

 

1

%

 

 

1

%

 

 

1

%

The following tables set forth the reconciliations from reported revenue for our C&W borrowing group to rebased revenue and related change calculations (USD in millions).

 

Three months ended

December 31, 2021

Year ended

December 31, 2021

 

 

 

Revenue by product – Reported

$

624.4

 

$

2,310.6

 

Rebase adjustments:

 

 

Acquisition

 

33.9

 

 

69.4

 

Foreign currency

 

(3.4

)

 

(15.6

)

Revenue by product – Rebased

$

654.9

 

$

2,364.4

 

 

Reported percentage change

 

7

%

 

6

%

 

 

 

Rebased percentage change

 

2

%

 

4

%

The following table sets forth the reconciliation from Adjusted OIBDA for our C&W borrowing group to rebased Adjusted OIBDA and related change calculations.

 

Three months ended

December 31, 2021

Year ended

December 31, 2021

 

In millions

 

 

 

Adjusted OIBDA – Reported

$

258.8

 

$

947.3

 

Rebase adjustments:

 

 

Acquisition

 

0.9

 

 

2.3

 

Foreign currency

 

(0.6

)

 

(4.8

)

Adjusted OIBDA – Rebased

$

259.1

 

$

944.8

 

 

Reported percentage change

 

6

%

 

6

%

 

Rebased percentage change

 

6

%

 

6

%

Non-GAAP Reconciliation for Consolidated Leverage Ratios

We have set forth below our consolidated leverage and net leverage ratios, inclusive and exclusive of VTR in light of the deconsolidation of VTR that occurred in connection with the formation of the Chile JV in October 2022. Our consolidated leverage and net leverage ratios, each a non-GAAP measure, are defined as (i) adjusted total debt and finance lease obligations (total carrying value of debt and finance lease obligations plus discounts, premiums and deferred finance costs, less projected derivative principal-related cash receipts) less cash and cash equivalents divided by (ii) last two quarters annualized Adjusted OIBDA as of December 31, 2022. For purposes of these calculations, adjusted total debt and finance lease obligations is measured using swapped foreign currency rates. We believe our consolidated leverage and net leverage ratios are useful because they allow our investors to consider the aggregate leverage on the business inclusive of any leverage at the Liberty Latin America level, not just at each of our operations. Investors should view consolidated leverage and net leverage as supplements to, and not substitutes for, the ratios calculated based upon measures presented in accordance with U.S. GAAP. Reconciliations of the numerator and denominator used to calculate the consolidated leverage and net leverage ratios as of December 31, 2022 and September 30, 2022 are set forth below:

 

December 31,

2022

 

September 30,

2022

 

Liberty Latin

America

 

VTR

 

LLA,

excluding VTR

 

Liberty Latin

America

 

VTR

 

LLA,

excluding VTR

 

in millions, except leverage ratios

 

 

 

 

 

 

 

 

 

 

 

 

Total debt and finance lease obligations

$

7,880.7

 

$

 

$

7,880.7

 

$

9,254.7

 

 

$

1,403.2

 

 

$

7,851.5

 

Discounts, premiums and deferred financing costs, net

 

94.0

 

 

 

 

94.0

 

 

120.4

 

 

 

18.2

 

 

 

102.2

 

Projected derivative principal-related cash receipts, net1

 

 

 

 

 

 

 

(167.6

)

 

 

(167.6

)

 

 

 

Adjusted total debt and finance lease obligations

 

7,974.7

 

 

 

 

7,974.7

 

 

9,207.5

 

 

 

1,253.8

 

 

 

7,953.7

 

Less:

 

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

781.0

 

 

 

 

781.0

 

 

832.2

 

 

 

63.0

 

 

 

769.2

 

Net debt and finance lease obligations

$

7,193.7

 

$

 

$

7,193.7

 

$

8,375.3

 

 

$

1,190.8

 

 

$

7,184.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income2:

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) for the three months ended June 30, 2022

 

N/A

 

 

N/A

 

 

N/A

 

$

(352.9

)

 

$

31.4

 

 

$

(384.3

)

Operating income for the three months ended September 30, 2022

$

152.9

 

$

30.4

 

$

122.5

 

 

152.9

 

 

 

30.4

 

 

 

122.5

 

Operating income for the three months ended December 31, 2022

 

109.5

 

 

 

 

109.5

 

 

N/A

 

 

 

N/A

 

 

 

N/A

 

Operating income (loss) – last two quarters

 

262.4

 

 

30.4

 

 

232.0

 

 

(200.0

)

 

 

61.8

 

 

 

(261.8

)

Annualized operating income (loss) – last two quarters annualized

$

524.8

 

$

60.8

 

$

464.0

 

$

(400.0

)

 

$

123.6

 

 

$

(523.6

)

Adjusted OIBDA3:

 

 

 

 

 

 

 

 

 

 

 

Adjusted OIBDA for the three months ended June 30, 2022

 

N/A

 

 

N/A

 

 

N/A

 

$

460.8

 

 

$

38.3

 

 

$

422.5

 

Adjusted OIBDA for the three months ended September 30, 2022

$

415.0

 

$

31.9

 

$

383.1

 

 

415.0

 

 

 

31.9

 

 

 

383.1

 

Adjusted OIBDA for the three months ended December 31, 2022

 

405.2

 

 

 

 

405.2

 

 

N/A

 

 

 

N/A

 

 

 

N/A

 

Adjusted OIBDA – last two quarters

$

820.2

 

$

31.9

 

$

788.3

 

$

875.8

 

 

$

70.2

 

 

$

805.6

 

Annualized Adjusted OIBDA – last two quarters annualized

$

1,640.4

 

$

63.8

 

$

1,576.6

 

$

1,751.6

 

 

$

140.4

 

 

$

1,611.2

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated debt and finance lease obligations to operating income (loss) ratio

15.0

x

 

 

 

N/A

 

(23.1

)x

 

 

 

 

N/A

 

Consolidated net debt and finance lease obligations to operating income (loss) ratio

13.5

x

 

 

 

N/A

 

(21.1

)x

 

 

 

 

N/A

 

Consolidated leverage ratio

 

N/A

 

 

 

5.1 x

 

 

N/A

 

 

 

 

4.9

x

Consolidated net leverage ratio

 

N/A

 

 

 

4.6 x

 

 

N/A

 

 

 

 

4.5

x

N/A – Not Applicable.

1.

Amounts represent the U.S. dollar equivalents and are based on interest rates and exchange rates that were in effect as of December 31, 2022 and September 30, 2022, respectively.

2.

Operating income or loss is the closest U.S. GAAP measure to Adjusted OIBDA, as discussed in Adjusted OIBDA and Adjusted OIBDA less P&E Additions above. Accordingly, we have presented consolidated debt and finance lease obligations to operating income (loss) and consolidated net debt and finance lease obligations to operating income (loss) as the most directly comparable financial ratios to our non-GAAP consolidated leverage and consolidated net leverage ratios.

3.

Adjusted OIBDA is a non-GAAP measure. See Adjusted OIBDA and Adjusted OIBDA less P&E Additions above for reconciliation of Adjusted OIBDA to the nearest U.S. GAAP measure for the three months ended December 31, 2022. A reconciliation of our operating income (loss) to Adjusted OIBDA for the three months ended June 30, 2022 and September 30, 2022 is presented in the following table:

 

 

Three months ended

 

June 30, 2022

 

September 30, 2022

 

Liberty Latin

America

 

VTR

 

Liberty Latin

America

 

VTR

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

$

(352.8

)

 

$

31.4

 

$

152.9

 

$

30.4

Share-based compensation expense

 

31.8

 

 

 

4.2

 

 

20.8

 

 

0.3

Depreciation and amortization

 

213.3

 

 

 

 

 

234.3

 

 

Impairment, restructuring and other operating items, net

 

568.5

 

 

 

2.7

 

 

7.0

 

 

1.2

Adjusted OIBDA

$

460.8

 

 

$

38.3

 

$

415.0

 

$

31.9

Non-GAAP Reconciliations for Our C&W Borrowing Group

The financial statements of each of our borrowing groups are prepared in accordance with U.S. GAAP. We include certain financial measures for our C&W borrowing group in this press release that are considered non-GAAP measures, including: (i) Adjusted OIBDA; (ii) Adjusted OIBDA Margin; and (iii) Proportionate Adjusted OIBDA.

Adjusted OIBDA is defined as operating income or loss before share-based compensation, depreciation and amortization, related-party fees and allocations, provisions and provision releases related to significant litigation and impairment, restructuring and other operating items. Proportionate Adjusted OIBDA is defined as Adjusted OIBDA less the noncontrolling interests' share of Adjusted OIBDA. We believe these measures at the borrowing group level are useful to investors because they are one of the bases for comparing our performance with the performance of other companies in the same or similar industries, although our measures may not be directly comparable to similar measures used by other public companies. These measures should be viewed as measures of operating performance that are a supplement to, and not a substitute for, operating income or loss, net earnings or loss and other U.S. GAAP measures of income.

A reconciliation of C&W's operating income (loss) to Adjusted OIBDA and Proportionate Adjusted OIBDA is presented in the following table:

 

Three months ended

 

Year ended

 

December 31,

 

December 31,

 

2022

 

2021

 

2022

 

2021

 

in millions

 

 

 

 

 

 

 

 

Operating income (loss)

$

77.1

 

$

(526.9

)

 

$

(252.1

)

 

$

(340.0

)

Share-based compensation expense

 

3.2

 

 

8.5

 

 

 

27.8

 

 

 

36.8

 

Depreciation and amortization

 

152.2

 

 

146.1

 

 

 

574.2

 

 

 

578.5

 

Related-party fees and allocations

 

15.0

 

 

14.3

 

 

 

54.2

 

 

 

42.6

 

Impairment, restructuring and other operating items, net

 

27.5

 

 

616.8

 

 

 

595.9

 

 

 

629.4

 

Adjusted OIBDA

 

275.0

 

 

258.8

 

 

 

1,000.0

 

 

 

947.3