Liberty .(LBTYK) - 2024 Q3 - Quarterly Report

Customer Base and Market Presence - As of September 30, 2024, the company served 4,008,800 fixed-line customers and 5,932,500 mobile subscribers, with networks passing 8,546,000 homes[213]. - The company’s reportable segments derive revenue primarily from residential and B2B communications services, with a focus on markets in Switzerland, Slovakia, Belgium, Luxembourg, and Ireland[211]. - The company experienced competition across all markets, impacting customer growth and average revenue per user (ARPU)[225]. Financial Performance - Net earnings for the three months ended September 30, 2024, were $(1,410.9) million, a decrease from $822.7 million in 2023[223]. - Adjusted EBITDA for the same period was $668.3 million, up from $597.7 million in 2023, representing an increase of 11.4%[223]. - Total revenue for the reportable segments was $1,935.2 million, an increase of $80.7 million or 4.4% compared to $1,854.5 million in 2023[227]. - The total revenue for the nine months ended September 30, 2024, was $1,854.4 million, reflecting a $30.8 million increase, or 1.7%, compared to 2023[242]. - Consolidated revenue increased by $80.7 million or 4.4% for the three months ended September 30, 2024, compared to the same period in 2023, and by $183.1 million or 3.3% for the nine months[253]. Revenue Segmentation - Sunrise segment revenue for the three months ended September 30, 2024, was $865.7 million, a slight increase of 0.7% from $859.3 million in 2023[227]. - Telenet segment revenue increased by 10.0% to $785.2 million from $775.2 million in 2023[227]. - Central and Other segment revenue saw a significant increase of 65.0%, reaching $229.3 million compared to $164.3 million in 2023[227]. - Total residential revenue decreased by $25.9 million or 2.0% for the three months ended September 30, 2024, and by $14.3 million or 0.4% for the nine months[254]. - B2B total revenue increased by $15.6 million or 4.1% for the three months ended September 30, 2024, and by $39.2 million or 3.5% for the nine months[248]. Cost and Expense Management - The company is experiencing inflationary pressures on labor, programming, and other costs, which may negatively impact operating results and cash flows[215]. - Programming and other direct costs of services increased by $5.3 million or 0.9% for the three months ended September 30, 2024, and by $112.5 million or 6.5% for the nine months ended September 30, 2024, compared to the corresponding periods in 2023[264]. - Other operating expenses (excluding share-based compensation) increased by $5.4 million or 1.8% for the three months ended September 30, 2024, compared to the same period in 2023[269]. - SG&A expenses decreased by $6.8 million or 1.6% for the three months ended September 30, 2024, compared to the same period in 2023[272]. Foreign Exchange and Financial Risks - The company faces risks related to foreign currency exchange rates, particularly with the euro and Swiss franc, which significantly impact reported operating results[217]. - The company reported a significant impact from foreign currency exchange rates, with 56.5% of revenue derived from subsidiaries using the euro and 45.2% from those using the Swiss franc[350]. - The foreign currency transaction losses for the three months ended September 30, 2024, were $578.3 million, a significant decrease from the gains of $664.4 million in the same period of 2023[296]. Shareholder Activities and Corporate Governance - The company authorized a share repurchase program for 2024 to repurchase up to 10% of total outstanding shares as of December 31, 2023, with aggregate repurchases of $503.1 million during the nine months ended September 30, 2024[329]. - The company anticipates that tax considerations will not adversely impact corporate liquidity over the next 12 months, allowing for potential share repurchase activities[326]. Future Outlook and Strategic Initiatives - The company plans to spin off the Sunrise Entities in November 2024, which was approved by shareholders on October 25, 2024[212]. - The company anticipates challenges in maintaining or increasing subscription rates due to inflationary pressures and competition in the broadband and mobile service industries[208]. - The company expects potential impairment charges in future periods if equity values decline or if adverse economic conditions worsen[288].