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01/10 16:00
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary reveals mixed results: a decline in revenue and adjusted OIBDA, particularly in Puerto Rico, and positive developments in Costa Rica and Panama. The refinancing of debt and increased free cash flow are positive, but the lack of clear guidance and competition concerns in Puerto Rico are negative. The Q&A section highlighted management's focus on cost-cutting and strategic investments, but also showed some reluctance in providing direct answers, adding uncertainty. Considering the market cap and the mixed signals, a neutral stock price movement is expected over the next two weeks.
Adjusted OIBDA $1.2 billion year-to-date, with a year-over-year decline of 6%. The decline was primarily driven by reductions in Liberty Puerto Rico, offset by growth in Panama and C&W Caribbean.
Revenue $1.1 billion in Q3, a 4% year-over-year decline on a rebased basis. The decline was mainly due to organic reductions in Liberty Puerto Rico, partially offset by growth in Liberty Costa Rica.
Cash Flow Adjusted FCF before partner distributions was $77 million, compared to $33 million in Q3 2022. After distributions, adjusted FCF was $66 million.
P&E Additions $171 million in Q3, or 16% of revenue, compared to $187 million or 17% of revenue in the prior year period.
Total Debt $8.2 billion at the end of Q3, with gross leverage of 5.2 times and net leverage of 4.8 times, a modest improvement from Q2.
Revenue from C&W Caribbean $360 million in Q3, flat year-over-year on a rebased basis. Mobile revenue grew by 7%, offset by declines in fixed and B2B revenue.
Revenue from C&W Panama $188 million in Q3, a 1% year-over-year decline. Mobile revenue grew by 9%, but B2B revenue decreased by 13%.
Revenue from Liberty Puerto Rico $308 million in Q3, reflecting a 13% rebased decline year-over-year, driven by lower mobile and residential fixed revenue.
Revenue from Liberty Costa Rica $146 million in Q3, reflecting 5% rebased revenue growth.
Adjusted OIBDA from Liberty Puerto Rico $88 million in Q3, representing a rebased decline of 24% year-over-year, mainly driven by lower revenue.
Adjusted OIBDA from C&W Caribbean $158 million in Q3, representing 5% rebased growth, driven by management's focus on reducing operating costs.
Adjusted OIBDA from C&W Panama $69 million in Q3, representing 17% year-on-year growth, driven by project-related cost phasing and synergies from the Claro acquisition.
Adjusted OIBDA from Liberty Networks $59 million in Q3, reflecting an 8% rebased decline, impacted by noncash IRU-related revenue decline and higher bad debt expense.
Adjusted OIBDA from Liberty Costa Rica $51 million in Q3, reflecting a 1% rebased decline due to higher bad debt expense.
New Subscribers: Added over 50,000 high-speed broadband and postpaid mobile subscribers year-to-date, with 225,000 adds excluding Puerto Rico.
5G Launch: Became the first operator to launch 5G in Panama, highlighting technology leadership.
Converged Commercial Proposition: Launched LOOP in Puerto Rico, combining fixed and mobile services.
Subsea Cable System: Announced partnership with Sparkle for a new pan-regional subsea cable system.
Market Expansion in Peru: Invested in a greenfield fiber-to-the-home business, passing approximately 3 million homes.
Growth in Costa Rica: Achieved over 1 million postpaid subscribers, with a 15% growth in the mobile base.
Operational Efficiencies: Successfully refinanced $1 billion of Cable & Wireless credit silo senior notes, reflecting strength.
Cost Management: Focused on cost cuts in Puerto Rico to improve EBITDA.
Strategic Shift in Puerto Rico: Focusing on regaining commercial momentum and improving customer experience post-migration.
Investment Strategy: Exploring inorganic ways to drive shareholder value, particularly in Peru.
Hurricane Impact: Hurricane Beryl negatively affected operations in Jamaica, Grenada, and St. Vincent and the Grenadines, leading to reduced broadband subscriber additions and revenue declines in Cable & Wireless Caribbean.
Regulatory Challenges: The cancellation of the FCC's Emergency Connectivity Fund resulted in a significant loss of mobile postpaid subscribers in Puerto Rico, impacting revenue.
Migration Issues: The complex migration from AT&T's legacy systems to Liberty's infrastructure caused unexpected challenges, including higher-than-anticipated churn and operational difficulties.
Competitive Pressures: Increased competition in the mobile market, particularly in Puerto Rico, has made it challenging to regain market share and improve revenue.
Economic Factors: Potential impacts from a stronger U.S. dollar and high tariffs on imported equipment could affect operational costs and capital expenditures.
Debt Management: The company has a significant debt load of $8.2 billion, with a gross leverage of 5.2 times, which poses risks in terms of financial flexibility and capital structure.
Cost Management: Ongoing cost-cutting measures are necessary to improve EBITDA, especially in Puerto Rico, where recovery has been slower than expected.
Subscriber Growth: Added over 50,000 high-speed broadband and postpaid mobile subscribers year-to-date, with 225,000 adds excluding Puerto Rico.
Adjusted OIBDA: Reported adjusted OIBDA of $1.2 billion year-to-date, with expectations for acceleration in Q4 driven by B2B and improved Puerto Rican operations.
Inorganic Growth: Exploring inorganic ways to drive shareholder value, particularly in Peru, where significant fiber footprint has been established.
Subsea Network Investment: Announced partnership with Sparkle for a new pan-regional subsea cable system to enhance connectivity and support growth in demand.
5G Launch: Became the first operator to launch 5G in Panama, highlighting technology leadership.
Cost Management: Implementing cost cuts and targeted commercial acquisitions to improve financial performance.
Q4 Performance Expectations: Expecting strongest cash flow performance of the year in Q4, driven by improved adjusted OIBDA and seasonally positive working capital.
Puerto Rico Recovery: Focused on regaining commercial momentum in Puerto Rico, with plans for improved adjusted OIBDA performance in Q4.
Capital Expenditure: P&E additions of $171 million in Q3, with plans for continued investment in growth areas.
Future Investments in Peru: Invested approximately $100 million in Peru over the last 3 years, targeting low broadband penetration areas.
Debt Management: Refinanced $1 billion of Cable & Wireless credit silo senior notes, extending the weighted average life of debt.
Shareholder Return Plan: Liberty Latin America has not explicitly detailed a Shareholder Return Plan involving dividends or share buybacks in the call. However, they mentioned exploring inorganic ways to drive shareholder value, particularly through investments in Peru and the development of a new pan-regional subsea system.
Investment in Peru: The company has invested approximately $100 million over the last three years in a greenfield fiber-to-the-home business in Peru, targeting areas with low broadband penetration.
Subsea Network Investment: Liberty Latin America is building a new subsea network, which is expected to enhance their operational capabilities and create future growth opportunities.
The earnings call reveals strong financial performance with growth in revenue and adjusted OIBDA across most segments. The strategic focus on cost-cutting and operational efficiencies is yielding results. The Q&A highlights ongoing cost initiatives and margin expansion, with positive sentiment despite some lack of clarity on cash use priorities. The market cap indicates a small-cap stock, which tends to react more strongly. Overall, the financial health and optimistic outlook suggest a positive stock price movement of 2% to 8% over the next two weeks.
The earnings call presents mixed signals. Strong financial performance in various regions, like the Caribbean and Panama, is counterbalanced by declines in Puerto Rico and Costa Rica. The Q&A reveals management's optimism but lacks specifics on liability management. The market cap suggests moderate volatility. Overall, the sentiment is neutral, with positive growth in some areas offset by challenges in others.
The earnings call summary reveals mixed results: a decline in revenue and adjusted OIBDA, particularly in Puerto Rico, and positive developments in Costa Rica and Panama. The refinancing of debt and increased free cash flow are positive, but the lack of clear guidance and competition concerns in Puerto Rico are negative. The Q&A section highlighted management's focus on cost-cutting and strategic investments, but also showed some reluctance in providing direct answers, adding uncertainty. Considering the market cap and the mixed signals, a neutral stock price movement is expected over the next two weeks.
The earnings call presents mixed signals: positive developments include a completed migration in Puerto Rico, promising 5G trials, and strong growth in C&W Panama and Caribbean. However, declines in Puerto Rico and Liberty Networks, high leverage, and a negative free cash flow are concerning. The Q&A reveals cautious optimism but lacks clarity on EBITDA projections. The market cap suggests moderate volatility. Thus, the stock price is likely to remain stable, with a neutral movement of -2% to 2% over the next two weeks.
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