Liberty .(US:LBTYK)2025-10-30 12:07Customer Base and Market Environment - As of September 30, 2025, the company served 11,443,800 fixed-line customers and 44,970,800 mobile subscribers, with networks passing 29,073,400 homes[250] - The competitive environment has adversely impacted revenue, customer numbers, and average monthly subscription revenue per fixed-line customer or mobile subscriber (ARPU)[251] - The company experienced competition across all markets, adversely impacting customer growth and ARPU[261] - The economic environment in the countries of operation is influenced by various factors beyond the company's control, potentially leading to inflation[252] Financial Performance - Loss from continuing operations for Q3 2025 was $83.4 million, compared to a loss of $1,423.7 million in Q3 2024[260] - Total consolidated revenue for Q3 2025 was $1,207.1 million, a 12.9% increase from $1,069.5 million in Q3 2024[263] - Total consolidated Adjusted EBITDA for the nine months ended September 30, 2025, was $996.4 million, up from $912.0 million in the same period of 2024, representing an increase of 9.3%[260] - Telenet's revenue for Q3 2025 was $804.9 million, a 2.5% increase from $785.2 million in Q3 2024, while VM Ireland's revenue increased by 2.0% to $122.2 million[263] Revenue Breakdown - The company derives revenue primarily from residential and B2B communications services through its reportable segments, including Telenet and VM Ireland[257] - Total residential revenue increased by $27.6 million (4.6%) to $624.4 million for the three months ended September 30, 2025, compared to $596.8 million in 2024[274] - Total B2B revenue increased by $20.3 million (9.5%) to $233.3 million for the three months ended September 30, 2025, compared to $213.0 million in 2024[274] - The "Plus: all other category" revenue increased by $94.0 million, or 40.9%, in Q3 2025 compared to Q3 2024[263] Cost and Expense Analysis - Programming and other direct costs of services increased by $72.5 million or 22.6% for the three months and $210.3 million or 20.0% for the nine months ended September 30, 2025[284] - Other operating expenses (excluding share-based compensation) increased by $23.6 million or 12.5% for the three months and $63.3 million or 11.5% for the nine months ended September 30, 2025[288] - SG&A expenses increased, with specific increases in core network and IT-related costs of $10.7 million or 19.4% for the three months and $19.1 million or 15.9% for the nine months ended September 30, 2025[288] - General and administrative expenses rose by $37.9 million or 24.6% for the three months and $50.2 million or 10.4% for the nine months ended September 30, 2025[293] Joint Ventures and Affiliates - The company has a 50% noncontrolling interest in both the VMO2 JV and the VodafoneZiggo JV, with results accounted for under the equity method[256] - VMO2 JV reported an Adjusted EBITDA of $1,250.3 million for the three months ended September 30, 2025, an increase of $79.4 million (6.8%) from $1,170.9 million in 2024[270] - The VodafoneZiggo joint venture generated revenue of $1,156.8 million for the three months ended September 30, 2025, slightly up from $1,131.1 million in 2024, with Adjusted EBITDA of $522.2 million compared to $527.8 million[318] Cash Flow and Liquidity - The total cash and cash equivalents as of September 30, 2025, amounted to $1,674.2 million, with $1,160.8 million held by borrowing groups[337] - Net cash provided by operating activities decreased to $580.2 million for the nine months ended September 30, 2025, down from $664.1 million in 2024, representing a decline of $83.9 million[358] - Net cash used in investing activities was $(607.8) million for the nine months ended September 30, 2025, a decrease of $1,327.7 million compared to $719.9 million in 2024[359] - The company aims to maintain a consolidated debt balance between four and five times its consolidated Adjusted EBITDA[353] Foreign Currency Impact - Changes in foreign currency exchange rates significantly impact reported operating results, particularly exposure to the euro[255] - The company experienced a foreign currency transaction gain of $3,160.9 million for the nine months ended September 30, 2025, compared to a gain of $202.1 million in the same period in 2024[260] - For the three months ended September 30, 2025, the company reported total foreign currency transaction gains of $10.0 million, compared to a loss of $934.9 million in the same period of 2024[308] Impairments and Restructuring - The company recognized impairment, restructuring, and other operating items of $22.0 million and $25.8 million for the three and nine months ended September 30, 2025, respectively[299] - The restructuring program initiated in Q3 2025 included $17.3 million in costs related to employee terminations[300] - The company experienced significant competition in the VodafoneZiggo joint venture, which may lead to potential impairments in future periods[319] Taxation - The income tax benefit for the three months ended September 30, 2025, was $46.9 million, compared to a benefit of $11.2 million in the same period of 2024[322] - The net negative impact on income tax benefits was primarily due to non-deductible foreign currency exchange results and permanent differences in financial and tax accounting treatments[326][327] - The financial and tax accounting treatment of items associated with investments in subsidiaries and affiliates contributed to the discrepancies in expected income tax benefits[326][327]