Liberty .(US:LBTYA)2019-02-27 21:05Revenue Performance - Total revenue for 2018 was $11,957.9 million, an increase from $11,276.4 million in 2017, representing a growth of 6.1%[314] - Total revenue for consolidated reportable segments increased by $703.0 million (6.2%) from $11,254.9 million in 2017 to $11,957.9 million in 2018, with an organic increase of $239.0 million (2.1%)[354] - The U.K./Ireland segment reported a revenue increase of $489.3 million (7.7%) in 2018 compared to 2017, driven by a rise in residential cable subscription revenue[357] - The Belgium segment's revenue increased by $132.0 million (4.6%) from $2,861.6 million in 2017 to $2,993.6 million in 2018, despite a decrease in non-subscription revenue[354] - The Central and Corporate segment saw a significant revenue increase of $84.8 million (44.8%) in 2018 compared to 2017, primarily from services provided to the VodafoneZiggo JV[354] - The VodafoneZiggo JV reported revenue of $4,602.2 million in 2018, an increase from $4,488.9 million in 2017, representing a growth of 2.5%[461] Operating Income and Losses - Operating income for 2018 was $839.1 million, compared to $792.4 million in 2017, reflecting a growth of 5.9%[314] - The company reported a loss from continuing operations of $(1,411.5) million in 2018, an improvement from a loss of $(2,350.0) million in 2017[314] - Losses from continuing operations were reported at $1,411.5 million in 2018, a decrease from $2,350.0 million in 2017, reflecting a reduction of 40.0%[471] - The company reported earnings from discontinued operations of $1,163.4 million in 2018, compared to a loss of $370.6 million in 2017, marking a significant turnaround[474] Assets and Equity - The total assets as of December 31, 2018 were $53,153.6 million, a decrease from $57,596.8 million in 2017[313] - Total equity decreased to $4,148.3 million in 2018 from $6,393.0 million in 2017, indicating a decline of 35.1%[313] Debt and Financial Obligations - Debt and capital lease obligations amounted to $29,805.2 million in 2018, down from $32,644.5 million in 2017, a reduction of 8.5%[313] - Interest expense increased by $11.3 million or 0.8% in 2018, totaling $1,478.7 million, primarily due to slightly higher average interest rates[447] - Net losses on debt modification and extinguishment were $65.0 million in 2018, down from $252.2 million in 2017[457] Revenue Sources and Segmentation - The company served 25,267,500 revenue generating units (RGUs), including 8,559,200 video subscribers and 9,270,400 broadband internet subscribers[323] - The average number of RGUs in the U.K./Ireland increased, contributing $70.9 million to subscription revenue, while ARPU increased by $49.3 million[357] - B2B subscription revenue increased by $50.9 million, driven by an increase in the average number of broadband internet SOHO RGUs in the U.K.[387] - Residential mobile subscription revenue decreased by $68.3 million or 6.3% on an organic basis, primarily due to declines in the U.K. and Belgium[484] Costs and Expenses - Programming and other direct costs of services are expected to rise due to higher digital video content costs and rate increases[424] - Programming and other direct costs of services increased by $271.5 million or 9.1% in 2018 compared to 2017, with organic growth of $164.5 million or 5.5%[426] - Other operating expenses (excluding share-based compensation) rose by $53.7 million or 3.2% in 2018, while organic expenses decreased by $22.2 million or 1.3%[430] - SG&A expenses (excluding share-based compensation) increased by $19.5 million or 1.1% in 2018, with total SG&A expenses reaching $2,049.1 million[434] Foreign Currency and Market Risks - For the three months ended December 31, 2018, 52.9% of reported revenue was derived from the British pound sterling and 32.4% from the euro, highlighting significant foreign currency exposure[339] - The company faces inflationary pressures and foreign currency exchange risks that could impact operating margins if costs cannot be passed on to subscribers[349] Acquisitions and Disposals - The Acquisition Impact is estimated based on the operating results of acquired entities during the first three to twelve months post-acquisition, adjusted for integration costs and unusual items[338] - The impact of acquisitions contributed an additional $108.6 million to total revenue, while disposals had a negative impact of $30.0 million[388] Taxation - The company recognized an income tax expense of $1,573.3 million in 2018, significantly higher than the $238.9 million in 2017[466]