Q3 2020 Liberty Global PLC Earnings Call

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Good morning, ladies and gentlemen, and thank you for standing by welcome to Liberty Global third quarter 2020, Investor call. This call and the associated webcast are the property of Liberty global and any redistribution retransmission or rebroadcast of this color webcast in any form without the express written consent.

Liberty Global is strictly prohibited.

At this time all participants are in a listen only mode. Today's formal presentation materials can be found under the Investor Relations section of opening football's website at Liberty, Google Dot Com. After today's formal presentation instructions will be given for a question and answer session.

Page two of the fights details the companies Safe Harbor statement regarding forward looking statements.

Which as we've said should be mid next year and you can see some highlights of our Q2 results on the right side of this slide we delivered strong customer growth in both fixed and mobile which will talk about the second and we saw modest declines in revenue adjusted EBITDA and operating free cash on a Charlie will drill down on those figures, but we are largely on plan for the year, which means.

We're managing through both the expected headwinds we identified at the beginning of the year and the unexpected impact of Cove, it pretty well and that's one of the reasons were confirming our original 2020 guidance today.

Digital platforms to drive things like online sales, which are up 10% in most markets and now represent nearly half of our sales in UK. For example, we also ramped up our digital care and support platforms, which helped drive call volume down 30 per cent of markets like Switzerland.

I'm sure you've heard from other operators the covid headwinds were less severe in Q3 than in the prior period. The return of sports improve roaming traffic and growth in both fixed and mobile subs helped our results more recently, however, we've seen a return to more stringent lockdown and social distancing protocols in Europe as infection and positivity rates of spike can be fair.

This could impact our medium term outlook, but I put out a few things most of the measures are intended to be short term and duration two to four weeks typically and generally they're more moderate and more targeted and last spring and after six to seven months of this businesses and consumers are more prepared this time around so I hope as I said before us to build in our improve.

Relationship with subscribers regulators and politicians and to make sure we come out of this period, even stronger and more customer focused and I think we will.

And the pandemic is also reinforced the fact that our strongest customer proposition is connectivity.

2.7% in 5.6% respectively those.

For your entertainment platform continues to delight customers with the best user interface seamless integration of apps voice control and tons of other features.

And importantly horizon is also laid the groundwork for our migration too and all I P video services platform with Paula box. This is in network agnostic App centric portable and low cost. This is where the entertainment business is headed and we're leading the way again in Europe.

Now our success in Holland, Belgium.

Really underscore excitement about the Sunrise acquisition, which we recap of it for you on slide seven the main driver here scale U P C and Sunrise together create a clear number two this wisconsin one of Europe's most attractive and stable markets with around 30 per cent share across all services and a significant opportunity to grab meaningful sure I'd be to be.

Now like our other F. M. C deals. The combination is anchored in best in class networks right out of the gate UPC Sunrise will reach 90% of the fixed market with one gig services they'll have leadership and for G mobile and the largest and fastest five G network in the country now the synergies are also substantial you'd expect.

With an M. P D of over 3 billion Swiss francs.

About 80% of which is attributable to Opex and Capex efficiencies now real opportunity here to deliver the sort of combined financial growth profile that we've seen in Holland I'm not saying the number it will be the exact same about were convinced that scale market strengthened synergies will deliver stable free cash flow for a very very long time, it's also worth mentioning that both.

Operations have a strong Q3 cause you can see from the charts on the right you cause he continues to deliver improved subscriber trends with a record sales month for mobile in September and consistent improvement in broad ma'am.

Uhm Sunrise released their results earlier today also a very strong order with positive service revenue growth despite romy headwinds.

Positive EBITDA growth, which reflects strong cost management. They also delivered their best quarter of postpaid mobile ads in a decade and really strong broadband a T V customer gross so far the pre merger integration work here has validated this energy estimates and clearly established the opportunity for Sunrise and UBC together that gives us come a run for its money now and on slide eight.

With a quick look at Liberty Global what we look like pro forma for both of US with in the UK transactions and most of you know this but it's really really important to continually reinforced the narrative how of how we transform this company.

We have tremendous converged scale in Europe, serving $84 million fixed and mobile RG use a generating $26 billion of aggregate revenue. That's a strong platform for value creation and as we've shown in Holland and Belgium, each operation generates stable long term free cash, though and represents a real opportunity.

For a further strategic growth and potentially public listing certainly sunrise has shown us that the institutional demand for crown jewel assets on local exchanges is huge.

Thanks, Mike.

Turning to a consolidated numbers I'm, starting on a page entitled underlying revenue stable.

Total revenue sort of decline of 1.3% in Q3.

And on the right hand side of the page, we set out our estimates of the impact of covered and then what it has done to our underlying revenue growth, which as you can see accounts will move in 100%, but the Q3 decline.

And Catherine we estimate of Covid reduced revenues by $41 billion compared to $110 million in queue too.

The total premium sports accounted for around $13 million.

Revenues will also impacted by $30 million and global revenues were reduced by nine but in predominantly by rubbing revenues.

9% on a presiding basis.

There was a reduction newbuild spending the quarter, but we still succeeded in building 125000 times in the UK darland contributing to a year to date type of 311000 homes.

We're looking to complete a third 100000 homes in queue for assuming our clients aren't affected by the upcoming lockdown.

In queue for we did not expect Capex to rise as it did in 2019 and set for the full year, we estimate capex the sales pre lightning will be around 20%.

The communist reduction in Capex will remain on track to grow oses mid single digits in 2020, as we set out to the next page.

63 reported oses, a $552 million and on a pre lightened basis $623 million of underlying oses.

All of our markets, except Belgium, where it was flat show underlying growth and ospf versus the Q3 2019 numbers.

The Netherlands in particular, so very strong growth rising from $247 million to $348 million year on year.

We expect these underlying growth to continue in queue for across our markets and our targeting $500 million a consolidated ospf the queue for including the impact of our lightning investments up from $433 million the previous year, turning to free cash let me confirm all guidance of $1 billion, a free cash flow for the full year increasing from 542.

Million dollars a year to date.

Setting up a key drove us to achieve this we expect no further material interest payments in queue for and run the previous years and tax payments will be minimal.

We expect to receive the balance of the shuttle distributions and developments ago, which we expect to be 50% of the upper end of that 400 500 million Euro target range.

He is a big working capital as positive $31 million and we expect it to be broadly flat for the full year.

Our underlying year to date pre lightning adjusted free cash flow with $789 million demonstrating the continued strong cashway generation of our businesses.

Turning to our capital allocation of on the next page group liquidity remains strong.

Reported full company liquidity of nine $3 billion at the end of Q3, including six $8 billion of cash and Sma's.

Performing for the Sunrise transaction close this will be reduced the five $4 billion, including approximately $2.9 billion of cash and Sma's.

If you overlay the clothes or the Virgin media Etsy transaction perform a cast is expected to be four $7 billion.

And with that transaction with deconsolidation presents revolving credit facility, leaving remaining labov as a $1.2 billion predominantly UPC credit pool, resulting in total group liquidity of five $9 billion, which will continue to provide the great with the excess capital to invest.

We continue to repurchase our stock and purchase $1 billion through the end of October.

Since two three of 2019, we'd be purchased 29% of our market cat and continued too much with purchase further stock.

As Mike indicated what looking to opportunistic and power back a further $1 billion through 2021.

Turn it standup is dividend distribution level committing to a dividend for $2 75 euro per share going forward. We see this film dividend distribution policy as a template for our future FMC companies as in exploring mccomas things over time.

In terms of leverage we remain committed to a four to five times leverage targets and a very comfortable at the top end of the range as those cleared near term visibility on EBITDA growth as we realized fmt's synergies, which allows us optionality today level towards the middle of the range and below over time.

Both of our existing FMC champions, Belgium by the things that go on this path both have long data that with an average life of around eight years of north borrowing costs fixed at $3, 4% in Belgium for 10% of preference ago.

Those in revenue remains of four four times in the U S gap basis for the execution of the synergies of eight six mobile consolidation.

One zero is continuing to execute percentages from this merger and should deliver further from his current four to five times.

We can put in a number of financing for the quarter, including trying to financings in advance of cleansing argued K Swiss transactions.

In both the UK in Switzerland companies will be like five times before the benefit of any synergies with average lives around eight years and the cost of that in the UK, a 4.4% and three 8% in UPC, which benefits from lower underlying Swiss rates.

Given the completion refinancings, we do not anticipate having to allocate any of our excess capital to further deleverage these or any of our other credit sorrows.

Inclusion category, so strong customer and broadband performance with high MTS.

The Swiss transaction has been approved of a close around mid November.

And the UK transaction remains on track.

Our underlying cash flow generation remains strong with capital intensity established by 20% of sales excluding lightning.

We are reconfirming all of 2020 guidance metrics, namely mid single digit adjusted EBITDA decline mid.

Mid single digit ospf growth and adjusted free cash flow for the full year $1 billion, including Lightning construction Capex and then finally, we're announcing new $1 billion buyback authorization.

And with that operator over two questions.

The question and answer session will be conducted electronically if you would like to ask a question. It. Please do tell by pressing let's start or extra key Oh, if I could get one on your phone.

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What parts for just a moment to give everyone an opportunity to join the kill.

And we will take our first question from VJ diet with Everquest.

Good morning, Mike.

Two questions.

Sure.

In the UK you've been.

Reconnecting with the a customized and instead of contact them on modifications other plans as far as part of the pricing of the base can you just talk about.

How much was done.

Customer impact in terms of.

<unk>.

An Indian but an outlook on what that could be.

Going forward.

Second set.

The bigger question.

Obviously fixed Bob can break in strategy, it's showing a lot of success and all of them in Belgium, we expect that to come in the UK in Switzerland over the next year any sort of talk about structurally of competitively constantly is Danny will lead them to market the new market won't have similar.

Success, and we can get back to you pretty healthy EBITDA growth.

Kit get growth and in that context is there any way to even quantify what side of the modern benefits are getting I know the John is down.

Better, but any sort of profitability medical.

Convergence of the fever.

Thank you.

Sure. Thank you day.

<unk> and I'll, let him drive the other contract an annual best tariff issue, what we've said in the past I before with the P. T. A L which is we're not giving specific disclosing specific numbers to who've contacted how many year, but we have said publicly that so far the effect of that in the contract.

Location process has been better than we expected, which means that while our churn from that process was largely in line. We have not had to provide the same level of discounting or or Kansas to offer that we thought with a car. So.

In the end, we believe that the end of contact location process. Thus far has been better than we expected, but how about leetch.

Get into that one you just answered the second question.

If there's more to add to that does go ahead well go ahead do that now that if you have something else to add to that.

Yeah, I think what I cannot.

Like over all you have to see stronger met that in UK. So therefore, you see that the number of end up conflict notification, it's not really material an overall, yeah, but yeah. We are doing much go downtown and on ops, you, yeah, 1% down but.

But yeah go we have had the price rise.

It started first of September and cause of October half-and-half across the customer base. So therefore, you see also that the impact.

Not too high however, that's named Tech and.

And take.

We'll also obviously flow through into a 2021, so that we have for me swallow and picked in a negative way 2020.

Yep and annual best tariff is really just started so it's too soon to know what titles out what about it yeah, sorry that.

Okay. This month on the FMC question listen I I do believe to answer your question and sort of the gel do you believe that both the UK, Switzerland can show should show.

Similar trends in terms of both financial trends in operating trying to what we've seen in Belgium and Holland.

There's a couple of things that are a thing of course, we look at the synergy estimates there.

And both market within.

<unk> of what we've seen and all the other transactions you've been involved and you've been involved them over a different country mergers, whether we're a seller or a buyer or a partner with F. M. C and so there's a lot of data on synergies just in the case of Holland, Belgium that was about 5 billion euro suggest them up and knocked.

Knocked the ball out of the park as they say on both in both countries. So we've got a chair or anything that actually I think it was I believe the estimates.

At the validate that don't the window the estimated to validate them both transactions by both sides of the equation.

Really good about those estimates.

To the number that you can switch it on and the six build a number of in in the UK those provide a lot of tailwind financially obviously, a course on the operating side. So the benefits of FMC hard to argue that Ah structural reductions in Sharon.

Consistent and regular improvements in M. P S.

In a competitive market, having described play bundle you said it doesn't seem that policy.

Corporate bundle matters being able to provide full package of products and services are all connectivity matters, having a mobile operation to cross celebre I've been having a broadband platform through crossville mobile matters.

And you know the the statistics statistics and the opportunities with very similar.

Both countries to what we've seen I can't share with you the long range plan, but if I could I wish you would see similar kinds of profiles.

<unk>.

The guidance on.

<unk> mid single digit while I just showed you that two years ago with negative high percent.

And we do think that those same kinds of characteristics of operating and financial art Superbowl and again I can't hear you My plan, but you should assume that we see that opportunity. Similarly, as do our partners in the case of UK and I think the Sunrise management team as well of course.

There wasn't the other side of the transaction for a long time, so everybody seems to be allying here and there were anxious to get service.

Thanks Bye.

Yep.

We'll take our next question from Michael Bishop Goldman Sachs.

Yes, hi, Besides just the one question, which is also on UK pricing and just want to say understand how do you think the price buses volume equation as what in the yeah not taking price.

And that's with a few cat essentially what you're thinking about next year, given betis means I'd actually some of the moves on UK, but I've always seen as well so just in general the pricing environment sales like a skull quite a bit better despite kindness.

Well I think I got that question.

Yeah go ahead, and all that I need to go ahead yeah.

Well I actually have.

Oh, they performed the price rise for this yeah Michael.

And you wanted to make sure that we really continue with the momentum the third up in especially broadband Nuggets.

And but it to record recognize yourself.

The market <unk> to get more rational on the price increase site and obviously, we cannot disclose here what we are going to do but I think overall I T that for that purpose.

Yeah, I think the decision made to defer the price rise in 2020 with the right decision. It had perhaps a module impact on volume, although I think it will reduce churn the pandemic essential element of our products and services probably had more of an impact on that but.

But as you pointed out loose the market is clearly expecting from other operators about about things of Vegas clear publicly that they will be taking price rises in 2021. So you know, we'll we'll decide internally what our best move is but what we think the decision in 2020 with the right one and.

For sure it set us up for a stronger 21.

Can we upgrade our next question can Bend Sunday with Morgan Stanley.

Thanks, Good morning.

Good afternoon to the folks overseas I I wanted to just stay in the UK. If we could two questions. One you guys have had some programming cost pressure I think over the last couple of years.

Probably largely tied to sports and I'm wondering if you look out from here if you see the curve, they're spending one way or the other partly bring it up because sky's talking about you know some real opportunities in terms of driving down I think entertainment expenses.

So I'm just wondering if if if you see that in your outlook as well and then sticking with video I know, we don't talk about video much anymore, but this Virgin T. V. 360 platform is this a big deal for your position in the market I don't know, how you would compare that to sky queue and I think it's I don't think it says your set top box or does it feel like a big capex.

[noise] deployments I wanted to make sure that's the case and get a little more color on that product, which launched this quarter.

Yeah I'll, let me again, you said a couple of things I don't hand revenue the 360 platform.

Really with a new user interface the horizon for you is there anything.

Which is excellent.

Excellent plus plus deal with everything you would expect to see them that you think is a game changer.

In this market where everybody.

Continues to watch video pretty pretty significantly on the TV [laughter], but it also integrates all the apps and has the full that's why it's called to assist you with a full.

Can you give me the OTT experience built in so we do think that's a game changer later this year when it when it rolls out it has been in other markets in Switzerland difficult without an island M. P. S.

And in Harlem M. P. S rises materially if people see it as the next the next generation of video experience, which we need to be part of an a customer drive as well.

The program the point.

Without being specific about any particular programmers.

Think it's fair to say that across Europe, not just in the U K.

We anticipate.

A different type of discussion with all of our linear providers, whether it be sports or entertainment, when you're seeing that and most of our market for not disclosing it.

And why is that occurring for the same reason you're seeing if he and yes, perhaps while viewership many of viewership remains prindiville Boston.

Compared to the U S. It's clearly move in the other direction over time, and you're seeing some modest losses and so can be subscribers. So the idea that will continue to pay more linear programming in Europe that will continue to play pay flat rates, if you will or not customer dependent weights is is crazy, it's not gonna happen.

It's so worth in all of our negotiations with with these providers will finding that.

Their desire to go over the top together with the headwinds Lucille in the video linear video business will result in better margins over time on the video product.

But I think most importantly on that issue, we're not waiting around for that that transformation, we're integrating apps and love boxes today as I mentioned in my remarks, or Ikea boxes was rolled out in Poland, That's an app centric.

Network agnostic pop you can roll it anywhere we have rights. So clearly Europe is heading the same direction integration of OTT apps aggregation of over the top content.

Leslie.

Okay Entertainment experience.

And you know we need to pack in Europe on that on that on that roadmap. So similar to the U S not quite a progressive or quickly appearing but I think <unk> pro programming cost pressure ought to be lessening for us over the longer term here, which is natural giving blair the the market's evolving.

Yeah, I don't need to get that most of it Mike So.

I think like a bedroom media T. V 360, you think it's a bit better vanskike cute alright, and we've had some furniture and it's got a cute doesn't that.

And it's an over the air software updates or customer forget.

And therefore, not high cost and it will be late two lower true alright. So because you know would come on the market that M. P. S is extremely high end that'd be sort of Elektra and we will affect though that in.

And on the on the program <unk> said, well when you compare gourmet programming <unk> 21 to 20, obviously the cost increase has flattened Lawrence.

Business mortgage with Covid in the long term, we're doing exactly what my cats explained for the oval European.

P market.

We want to get a much more radical strike or we help all are tough enough on their way to direct to consumer.

And we have a lot to offer that from Pullman and state your ankle and so forth and on the other side. We are keen on getting a more on variable content cost for linear viewing and we have already managed for clothes. Some of these contracts and then I'll opiate sending shivers.

And don't underestimate the the leather do bring to those conversations today you know years ago. Then we didn't have any mobile customers. Today <unk> include and you know so I will have something like 50 million mobile sounds C. O T. T guys are searching us out you know they they want you know it you've seen how well that's where I can do it for different plots and you've seen all you can teach you guys here and.

Looking for mobile partnerships to get launched we're in a position and all the core markets to play that role in a O T was already the lodge partner for Disney plus in the UK, So will be in that position and all these court and she markets with the mobile platform, which gives us additional leverage in those conversations right.

Got it and that makes sense. Thank you both.

Okay.

I don't take our next question from Steve Malcolm with that Brian.

Yeah. Good afternoon, guys Uhm I, just Wanna come back to that question of programming costs clarify if that's okay. And then one more quick question. After that Uhm you basically have two large premium sports providers in the U K B T and sky the Beachy deals largely fix the sky deals kind of fixed and variable.

What you were saying you know I think it's reasonably clear, but should we assume overtime, you're making every effort to make those fixed costs for those two large suppliers more variable and give them kind of you know more access to a larger base and ability to go out T. T. So I guess that's question one and then secondly, just the local listings point like I'm trying to I get off this law.

February but.

Look around Europe, there are two kind of.

Companies that that he'll tell him that in order to D. Both trade it very high dividend yields and pretty like multiple so I guess the question is what's the market missing why would switch it would be that different is it just cause it's a better market.

Would you consider something a bit more radical say a food the merger to your shareholders in an effort to create value. Thank you.

Well I'll take the second one is that you can be thinking about the first one Charlie China in here too. If you want I I was looking I think there is.

Did at the same question last name. Please write that down there are lots of reasons I'll tell him that.

Sure. It is when we think that the the dividend they've announced longterm free cashflow profile their competitive position in the marketplace.

Ah Ah winning.

Characteristics I think there was some concern that you could tell them that amongst shareholders, there specifically related to strategic issues, whether it's the media's conversation capital expenditures. So that'll be can you look a towel on it and read across the rest of Europe until well because of trade here you know a Swiss I P. O R. A U K I P O won't trade well if you just like a boat.

<unk>, but keep your <unk> need K P N and all the core metrics. If you look at the three months or year to date results for both companies, It's night and day and yet you know that that will also could be an opportunity for reasonable.

Uhm Lastly, I'll, just say that [laughter].

Wow Yogi it could be right in the valuation 20th Boston, perhaps we hope for they couldn't be any lower than our own valuation. Let me just pause there alright. So so perhaps it won't be nine times, EBITDA and 6% free castle deal, but if you look at where we tried today, creating local listings.

With local following and local energy in that marketplace gives you the shot at and manage though with the balance sheet correctly and the dividend profile correctly, taking a shot at longterm value creation day, but apparently will not able to achieve topco here provisions you would know better than me I suppose and so from my point of view, creating value at the opposite whether it's a lazy so.

Germany or the way over to a manager telling it was a valuable creative both let me go back the core of that great value for us and we'll look at all options to address your last point will look at all options to create bye Bye Bye now you can flush with the value gap.

Goes or whatever that might look like.

So that should be a state New York instead of number one how about.

Thank you bye.

I, just got off and it should be assumed that you would seek to use any proceeds raised through and Ikea just to retire more equity arbitrage a hard multiple in Switzerland, possibly against your you know your group multiple.

I think it's cause we generate free cash flow. So we don't need to look at inorganic transactions to raise cash for equity strikes. So can generate free cash, but look it will be opportunistic you've seen that the last five years ready. We've always done that we believe is the right thing both in terms of the awkward and strategic position, we're in and you'll be.

Go to the manager capital capital allocation, so nothing's off the table.

No doubt about us however, I think that the <unk> should be pretty clear would you want a desk a program your cost question.

Yeah. My my comments the fourth more across all told them. It costs. So you will know only really furry to the sports premium programming alright. So therefore take this view a bit more broadly across all of our content close to not go into the print when it comes to the spot premium.

Obviously, we have to expose pop Knoxville T N Sky still we we have to be in there and then existing contract and.

That would come up I think in a few months ago.

So yeah, we need to find the weight on one hand side.

To to help our partner to have a secure revenue stream.

Alright to to sit on something more variable and and this is something up with you. When you go figure out in the.

It makes the 18 months and and then obviously we were we would share that with you guys. So I could be the idea is.

Obviously strategically and generally we wanted to get more on there the cost and on the other hand five if it comes to available then obviously, we use all the yes. It's we're having two two then come to a proper bunion plan behind that.

Deep just one fight you figure negotiating position with those offers are stripes into the last eight months given what's happened.

Well I mean, so first of all we have worked very good together.

During the pandemic I think that that's what they're good and then I mean these contact me a contract to come into play I think when we also hopefully at close.

And and then yes, I need them, we have mobile endothrix customer and hopefully we have multiple for for the submission all of them.

Great. Thanks, a lot.

Mhm.

And we'll take our next question from Matthew hair again with benchmark.

Well, Thank you Mike and your comments at their cable Jack you kind of highlighted some differences between your position and in the U S.

Raiders a lot more fireworks competition over in Europe, and how about you also seem to suggest pretty explicitly even.

You thought the the headroom a DOCSIS three one with a little bit less than what you asked the offers were saying and clear with it.

Requires a need for deeper fiber.

And your doctors four O L. About I mean do you think that's a fair characterization and do you think that with all this capacity being brought on five G. Doctors for when all there you're gonna finally see some better App development that you can monetize I'm nursing cool things a cable tech like the light field whole grass.

Coughing frog and all that but yeah. It feels like you really could see some definite celebration in your in your perceived value in price, but you absolutely can <unk> zoom in conferencing and all that thank you.

I think there's a couple of points there the value of our networks is undeniable you can just look at what's happening European infrastructure space. You can let me know networks are valuable today, well beyond with a few valued and and and for all kinds of reasons. It made good sense the path to continue speed.

Enhancement in our in our fix networks, we've got multiple paths today.

Today, we're getting the most out of free that one with a good we can you've already trial, two and a half phds with three that one you know that's something that's something we can do if you choose to do trial that in the UK, but we're really focused on 10 G. Four can gig and to be honest with you. When I mentioned, one gig five or six years ago, everybody was like what the heck is that needed for.

Trust me when I say that the 10 gig conversation will be starting and restart and will be starting pretty quickly and when we look at our networks. You've got a couple of ways to get there with boxes for that as you mentioned and where would that fall right in line with the U S operators charges Comcast both of them to be pursuing a strategy like that and we could also you can find it at home.

Yes pond, where we had been since the economics to support that kind of roadmap. The time G. So stay tuned lots to talk about there and as you point out lots of cool things with faster speeds are low latency lots of cool things we can do.

Both of our fixed and mobile networks, you know, we just talk yesterday as a team on some of the internet or the ideas, where I live in that thing.

And that'd be it to be honest with you guys will benefit should being in the mobile space for the I T opportunity. It's also advantages to be partners with companies like Telefonica, Vodafone who are leading the way in the development of loyalty Avenue and his partners of ours, we learn and benefit from that too. So I think there's tens of opportunity to monetize networks fixed and mobile continue to.

Stan speed and capacity and introduced late in two to five you attended and you know Sky's the limit I think that's really why these networks are being valued where they are.

Thanks Bye.

Yeah.

And we'll take our next question from change that that with.

With Me Street research.

Yes. Thank you very much and date and two quick questions. Please. The first one was just regarding your U K K P. I mean, the customer ads this quarter ready look to me like one of those kind of stand out steak as in never Lynch. I was wondering if you could kind of just talk us through a bit more what's help.

To drive that it adds up you know you can start. It then we saw in queue to I mean, it is that solely down to be more kind of price competitive out a short not having the price rise might've been any impacted September so I'm a strong performance day I was wondering.

You know what you can say about how you see that in future Cortes as well and then.

And secondly, just interested to get your updated thoughts on the I T V. Steak I believe that that call up position. You have is now on winding I think about the cheapest San Anton wound in the quarter. So you'll know running a kind of economic stake wait at quickie expenditure on the I T V steak again.

Just interested in your thoughts on the kind of rationale for continuing to hold back and what you want to do with that state longer term and cute.

I'll take the second one which you can take the first one look at an I T V. As he would know games. When we originally acquired our position some time ago average cost as well over two pounds. Fortunately, we call in that position and had virtually no economic exposure to the ups and downs of I T V. As those colors are <unk>.

Fiery, we had a choice to make and we decided to average down the price around 70% or more so we're essentially owning the shares that the market thinks we owned anyway at about a 70% reduced price and online that was worth exploring and we are doing that from time to time and we think that's smart we have no intention of do.

Anything with the state we have no intention of doing anything with ITV look at we're gonna be the second largest telco in this market second only to beauty and I view as a small stake in the largest broadcast your could be strategic.

Definitely offensive it I don't know, but there's an opportunity to own that day for 70 per cent left if <unk>. If you think that's a good trade. So we might look at that we might not we could head the position again once we what's the online that we could also had good again, so and they expect us to be you know.

Financially astute and take advantage of any opportunities are out up to the average down and be and be stronger position than we were.

<unk> on that strategic take a physician or a strategic steak. So did you want to take the case at that point.

Yeah on.

Freedom in your Christian walk around fix my back.

And then so I think it's two sector right. The Chinatown and this is not only because of Covid corporate pet's health, especially in queue to add Openreach Heck no installation pizza all day, and we have a tech look up the case in here three but we have done a lot for a couple of months.

On the show up or call Central resources that we have offered a lot of good to too funny charge of poor customer. We have offered hand up ended speed at the minimum for everybody without charging more so we have to offer them up to them and N. P. S has increased at 10% which card so previous here so.

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Gotcha and.

And this is in effect, which we see.

It's it's not only into 223, it's more midterm and obviously also we are making up for the chair on Los Angeles and up contract notification for that said before.

And then on the other hand side, although we have close all our research tools, we must remember that we have been able to accelerate failed. So we not only about budget yeah.

Previous yet in terms of sales and and I need Exposition price.

If more under pressure alright, so that if why are the best book, it's getting more rational the acquisition pricing is still the covid competition, we are not going down trees prices and we get a a fair share and that's a culmination and also obviously fix mobile convergence with helping alright.

So we have launched 15 months ago, and also that you would see that more more contributing for sure. So therefore, maybe long explanation, but sort show up so it's not that we have done anything special.

More commissions or no what a physician prices a mom with me or mutual attention and we can only do the schools one quarter. It as an automatic effects of the long term either mortgage until better MPAA for customer and an electric.

<unk>, sorry about that what kinda suggests that the right you've seen in Q3, <unk> probably be sustained any kid it towards into queue for as well.

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Okay. Thank you.

And we'll take our next question from Andrew be all authenticated.

Hi, Uhm, just one of them from Steve failure, Alright. Good question, I mean, I I guess I understand the point rush isn't the current let me see global equity valuation uhm, but.

What are you thinking of the rough timeline can make listings uhm I'm given the state of the European sect evaluations why why do you think this is a better midterm Bunny Christian Kaufman private Montreal corporate transactions, giving you know fairly unique footprint. The fact that seems to be pretty wide go between public and private.

Both of the operating us at noon, so the underlying infrastructure.

And also if I can just ask <unk> when you say strategic investments Jason too can you explain what you're meaning I I mean, I see <unk>.

Five and Tony's Enchondroma, please <unk>, but what about geographic expansion excuse me content and is there anything you can rule out.

Yeah, Okay two questions.

I P O question.

And the reference department to buy the multiples and other sort of corporate transaction you know us we are always going to be opportunistic.

And it isn't that you have one and we will pursue that path at all costs no stand standby understand no stand down we're going to be looking at all sorts of opportunities and sometimes it could be doing factor, yeah, who knows but we do know that that taking action and being taught him on the first show up when it comes to value crystallization and things of that nature.

<unk> posture for us and so you'll see US look at these opportunities may not take advantage of them. We might so we'll always be opportunistic and focused on creating value first and foremost an we'd never exclude any particular financial corporate a strategic approach to doing that without getting into the details of what those might look like.

<unk>.

Valuations of things of that nature, you just need to rest assured that we will.

Email us you've seen as you've watched out with David and a guest and stay agile well. We can do what you think is the best for long term value creation con in terms of adjacency, yes, certainly we can do a certain things out and you know what geographically our focus is principally in Europe. That's what we think the Adjacencies design, yeah, because we have a strong.

Long pitch number 430 in Europe, and so for the most part the Adjacencies geographically we'd be in your epidote exclude you know.

Absolutely anything else that you should assume that most of those adjacencies would be your focus and then you Jason choose with the technology and content focused things that enable our core fixed mobile converged platform. So the things that we've done you know investments we've made in our tech platforms of things to Charlie and Andre I'm working on.

And infrastructure things that I was content team or investing in these are all opportunities to not just to make money and the underlying investment but create value relationships long-term partnership with our operating assets. So the adjacencies are sort of you know structural in terms of our operations in our technology platform.

And they are you know geographic and it's also thirdly using our expertise.

One thing we know how to do is find self company and one thing we know how to do is finance and manage and and structure businesses. We have an incredible TNI platform that M U K one.

Vast knowledge of where things are happening with technical that things are going technologically and so the adjacencies also exist in our talent pool and our expertise in our specific you know capabilities in this marketplace. So those are the three adjacencies, we're referring to and I would you know if you stick with those two lenses I think you'd be you'd be close to where we're heading.

Okay. Thanks, just on the timeline can like lift things is there anything you can say without breaking news.

I don't think so yeah, no I don't I don't really want to get into that right now.

And we'll take our next question from Christian thing then with each S E C.

Yeah, Hi, Thanks, I've actually a question on on the Swiss business it looks like.

The U P. C S. It's finally stabilizing it's onto your trends.

But financially I mean, obviously, we have not seen a substantial improvement.

Why what what's the structure issue that the avatar is weaker than.

Then the then the top line performance I used to the investing in the infrastructure.

Expecting a bit more you know, let's say closing the gap between the revenue trends in there I bet that trend I mean, I know going forward now that you're on.

Some wife thinks with maturity to change anyway, but just trying to understand the the short term dynamics with respect to cure for maybe two one next year. Thanks.

In that case, which are you taken several that.

Yeah. They should about peace then maybe late and so we see now in the quota that in quite a momentum really calls.

Nah that's in the last.

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Doesn't really to me, but like always in the cable business Your transportation and show. Your last 18 months 24 months Nedette price effects flow through your P and L.

But like pull most we were able to stabilize the T catch though and again, it's toll free cash flow cool. So we did we see the momentum doing around in the in the coming years as well so Charlie.

Yeah, you're right they're very helpful.

I can truly across the board.

Cause it has been accelerated what was gonna be good time investment anyway. The other thing I think Christian which are very minded there's another switch across our cost structure.

Capex dwell, thanks, which actually a good thing so.

So for example, if you provide services.

Which is what was he a more efficient way of providing a full set your password in the old days you to Kansas Capex. So that's one of the reasons why sometimes it seems counterintuitive, but I'll O S. C. F is growing so much but I'll quit Abigail hopefully if it's declining there was a bit of an accounting with that cause recent materials that trunk quantify that for you because if it was a whole lot she it that you're in.

Yeah.

Okay, and then I have a wonderful off regarding the UK deal and it looks like.

Like and with respect timing kind of your.

Uhm scheduling or expecting a poor kind of a bit of next year that implies actually that you think it's going to the U K level and rather than staying at the you is it is it a fair assumption.

Well I was outside of our control really I I think you know it could that timeframe could also be consistent with a longer term evaluation from you right. So but you know it's really in the hands of the commission they will determine.

Whether to decide the case or refer back and we will prepared for the longer term process. If that's where it goes and will happily engage with C. N N a.

What's your name that to some extent off calm on the transaction, which we think is absolutely in a positive for the UK consumer the UK business environment and you know has been actually no competitive issues at all.

The cleanest simplest transaction any regulators looked at so we're we're excited to keep the process moving and I think the next year's attack when we've always talked about it and so what will hopefully make that time frame.

Okay. Thanks, Good luck alright, operator, Yep, you got it that's it for us operator, and I want to thank everybody for joining us getting a little over an hour less if you're still on so I appreciate that just to point out the I R. T as in London in Denver are always available.

More questions and standby so feel free to reach out to them in order to me and Charlie or anybody here that that you'd like to chat with the doctors, who I would appreciate your input questions and we look forward to talking to you in three months or so between that and then the foodstuffs April well. Thank you very much everybody take care.

And he's a gentleman that concludes February 3rd quarter 2020, Investor call. As a reminder, a replay of the call will be available in the Investor Relations section of Liberty Globals website. There you can also find a copy of today's presentation material.

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Good morning, ladies and gentlemen, and thank you for standing by welcome to Liberty Global third quarter 2020, Investor call. This call and the associated webcast are the property of Liberty global and any redistribution retransmission or rebroadcast of this call or webcast in any form without the express written consent of Liberty Global.

It is strictly prohibited.

At this time all participants are in a listen only mode. Today's formal presentation materials can be found under the Investor Relations section of Liberty Global's website at Liberty Global Dotcom.

After today's formal presentation instructions will be given for a question and answer session.

Page two of the slides details the Companys safe Harbor statement regarding forward looking statements.

Today's presentation May include forward looking statements within the meaning of the private Securities Litigation Reform Act of 1985 incur.

Including the company's expectations with respect to its outlook and future growth prospects and other information and statements that are not historical facts. Please.

These forward looking statements involve certain risks that could cause actual results to differ materially from those expressed or implied by these statements.

These risks include those detailed and Liberty Globals filings with the Securities and Exchange Commission, including its most recently filed form 10-Q, and 10-K as amended Liberty.

Liberty Global disclaims any obligation to update any of these forward looking statements to reflect any change in its expectations or in the conditions on which any such statements speak.

I would now like to turn the call over to Mr., Mike freeze.

Thanks, operator, and welcome everyone, there's quite a bit going on in the world. So we certainly appreciate you spending an hour with US we'll try to make it worth your while Charlie and I will handle the prepared remarks today and then I'll get other objects involved into Q1 as we normally do I will be referring to slides as you walk through quarters, hopefully can grab those off the website and.

Follow along with us and I'll kick it off on slide four with some key highlights from the quarter and this should get you level set on most of the main issues many of which will come back to in this presentation and let me start with the pandemic as we've discussed throughout the year, while were not immune to the effects of this global crisis of course, nobody is we continue to delay.

However, solid operating and financial results largely in line with or in some cases better than our original expectations for the year and I'll talk about that a bit on the next slide.

Obviously this has been a busy year for us on the M&A front and we're excited to be on the verge of closing our acquisition of Sunrise and the Swiss markets. You would have seen that around 97% of the shares were tendered to us which is a great result, and will facilitate the delisting and merger process. We.

We also just received all regulatory approvals, which means we're targeting completion of that transaction actually next week and then a few slides I'll spend just a minute revisiting the strategic and financial benefits of this combination which are significant.

We're also making steady progress on the completion of our JV with Telefonica in the UK.

The teams are working extremely well together and have already validated to 6.2 billion pounds synergy estimate they've developed strong commercial day, one plans and of course. The transaction is now fully financed I'd say are even more convinced today that this will be a fantastic deal for customers employees and shareholders and are waiting for now is regulatory approval.

Which as we've said should be mid next year and you can see some highlights of our Q2 results on the right side of this slide we delivered strong customer growth in both fixed and mobile, which I'll talk about the second and we saw modest declines in revenue adjusted EBITDA and operating free cash on a Charlie will drill down on those figures, but we are largely on plan for the year, which means.

We're managing through both the expected headwinds we identified at the beginning of the year and the unexpected impact of Cove, it pretty well and that's one of the reasons were confirming our original 2020 guidance today.

In particular mid single digit operating free cash flow growth in $1 billion of adjusted free cash flow both of which are benefiting from continued declines in capital intensity no doubt notice that we added a billion to our buyback program. Today. This will give us the flexibility to be opportunistic during the remainder of this year and will give us the capacity to continue shrinking.

Equity in driving Levered free cash flow per share in 2021.

And then finally I just want to say how encouraged we are by our employees and how well they are managing through the spend demicks and we've consistently made their safety and wellbeing our number one priority and as a result, we're seeing record engagement levels across our markets, which is a good segue to the next slide where we talk a bit about the COVID-19 pandemic.

Which has in many ways highlighted some of our own strengths beginning of course with our networks, which have remained resilient in the face of increased utilization both upstream and downstream.

Plenty of remaining capacity I, just I can't express how important this is for the families and students in hospitals and schools and businesses that we serve it certainly helps explain why we are experiencing some of the highest NPS levels, we've seen across our core markets.

And allowed us to support our customers with more data more speed and more content, while at the same time supporting our communities with programs like Virgin Medias essential broadband and Telenets digital lifeline services that are targeted to the more vulnerable among us for home connectivity is even more important.

I would also point out the cobot has forced us to accelerate our investment in other areas of our business like digital we've talked about this when customer care centers were disrupted in shops are closed we need the lean on our digital platforms to drive things like online sales, which are up 10% in most markets and now represent nearly half of our sales of UK. For example, we also ramped up.

Our digital care and support platforms, which helped drive call volume is down 30% in markets like Switzerland.

And I'm sure you've heard from other operators to co bid headwinds were less severe in Q3 than in the prior period. The return of sports improved roaming traffic and growth in both fixed and mobile subs helped our results more recently, however, we've seen a return to more stringent locked down and social listening protocols in Europe as infection and positivity rates of Spike NFV.

This could impact our medium term outlook, but I point out a few things.

Most of the measures are intended to be short term in duration two to four weeks typically and generally they are more moderate and more targeted in last spring and after six to seven months of this businesses and consumers are more prepared this time around so.

I hope as I said before is to build on our improved relationship with subscribers regulators and politicians and to make sure. We come out of this period, even stronger and more customer focused and I think we will.

And the pandemic is also reinforce the fact that our strongest customer proposition is connectivity fixed and mobile fast and reliable and intelligent and adaptable connectivity, including also the integration of incredible features content and applications and on slide six you can see that our broadband results reflect that.

With 71000 net additions in the third quarter, that's up six fold from a year ago, and we saw strong strength across our footprint, Belgium had its best result in five years. The UK delivered solid growth on both the lightning Nvidia you footprint and Switzerland had its first positive month in September and a very very long time, and we know that speed leadership still Matt.

Others in these markets and that our investment in fiber deep smaller node to DOCSIS three dot one is paying off.

Remember the debates we all do around the question of who needs a 100 megabits at home what today nearly 100% of our UK customers are taking 100, megabits or higher with average speeds of 156, Meg across the footprint, but where that compares to 46, Meg and the rest of the UK among other operators across Europe around 50% of our south.

Subs are taking the products of 200 Mega higher and then you add to that the fact that we are gigabit ready across 32 million homes and actively marketing gigabit services to about 45% of those and we're in a very strong position here. There's no question that broadband is also impacted positively by our fixed mobile strategies.

Across our markets, where convergence continues to grow in Holland over 40% of broadband subs take a mobile product from us after about three years and we'll talk a lot about the strategic and operating rationale for fixed mobile convergence Europe. We've done that will continue to do that and there's really no better example than photophobia Ziggo in Holland, There's a chart on this slide and.

I apologize, it's a little small, but it shows the complete turnaround and revenue and EBITDA growth, but the team has achieved over the last three years in 2017, the company's revenue EBITDA declined 3.7% in 5.6% respectively.

Those numbers have improved steadily every year with revenue and EBITDA actually in the nine months of this year up 2.5% in EBITDA up 7.5%. There are several factors that contribute to this including of course, a significant synergy target that was achieved year early but equally important is the positive impact of higher NPS and reduce.

Churn levels from fixed mobile subs, that's anywhere from 50% to 80%.

And the scale that Vodafone Ziggo has in the Dutch market is also critical right. It's now larger the KPN and broadband fixed voice and entertainment services and is generating four to 500 million euros of distributable cash to shareholders. This year.

The other major factor here is continuous innovation across our product and technology roadmap in Holland, Vodafone Ziggo is rolling out a nationwide one gig network. They were the first to rollout fiveg and they've embraced our horizon entertainment platform and that sort of innovation is occurring across the European footprint. It all begins with network superiority in markets like the UK for.

Sample or project lighting has been resoundingly success. In fact, we've included the latest figures in the appendix of the stacks of check them up and we continue to be bullish on continued expansion of lightning.

We're also working on a clear path to 10 G are 10 gigabits per second.

Using a combination of HSC and fiber to the home page.

Pace of innovation of five you mobile is equally critical with Vodafone Ziggo and Sunrise and others, leading the way in their markets revenue.

Robust and reliable network support innovation to connectivity, which is where this all began and moved led the way with smart and intelligent Wi Fi in better faster and cheaper CP and then finally, our entertainment platform continues to delight customers with the best user interface seamless integration of apps voice control and tons of other features.

And importantly horizon has also laid the groundwork for our migration to an all IP video services platform with Apollo box. This is network agnostic app centric portable and low cost. This is where the entertainment business is headed and we're leading the way again in Europe.

Our success in Holland, and Belgium, really underscore our excitement about the Sunrise acquisition, which we recap a bit view on slide seven the main driver here scale, you PC and Sunrise together create a clear number two to Swisscom one of Europe's most attractive and stable markets with around a 30% share across all services in a.

An opportunity to grab meaningful share and b to B now like our other FMC deals. The combination is anchored in best in class networks right out of the gate.

You'd be sunrise will reach 90% of the fixed market with one gig services.

I'll have leadership in Fourg mobile and the largest and fastest fiveg network in the country and the synergies are also substantial you'd expect that with an NPV of over 3 billion Swiss francs about.

About 80% of which is attributable to opex and capex efficiencies the real opportunity here is to deliver the sort of combined financial growth profile that weve seen in Holland, I'm, not saying the numbers will be the exact same but we're convinced that scale market strength and synergies will deliver stable free cash flow for a very very long time, it's also worth mentioning that both.

Operations had a strong Q3, you can see from the charts on the right. You can see continues to deliver improved subscriber trends with a record sales month for mobile in September and consistent improvement in broadband.

Sunrise released their results earlier today also a very strong quarter with positive service revenue growth despite revenue headwinds.

Positive EBITDA growth, which reflects strong cost management. They also delivered their best quarter of postpaid mobile ads in a decade, and really strong broadband and TV customer growth. So far the pre merger integration work here has validated the synergy estimates and clearly established the opportunity for Sunrise and you can see together to get Swisscom a run for its money now and on slide eight.

With a quick look at Liberty Global what we look like pro forma for both the Swiss and the UK transactions. Most of you know this but it's really really important to continually reinforced the narrative how of how we've transformed this company.

After spending over a decade consolidating cable and chasing broadband market share we saw the fixed mobile convergence story developing in Europe around five years ago.

Around that time, the incumbent telcos started prioritizing or fixed networks and broadband growth together with wireless and they left the other three to four mobile operator struggling to compete with their own fixed infrastructure because it didnt have any.

That was a moment we pivoted.

Where we didnt have scale, we exited the mobile only operators like T mobile in Austria, and Vodafone in Germany, and as you know those deals were valued at double digit multiples and represented huge returns on equity for us because of the value of the network and the value of the fixed customer base. In fact, you could argue that at those prices look cheap given where infrastructure assets are trading.

And where we had network and broadband scale, we decided to build our own FMC champions in four markets right. We merge with Vodafone mobile unit in Holland to form a 50 50 JV and it just showed you the results there we by Kps mobile business in Belgium, and Telenet today is a leading converged operator in the market, we announced the merger Virgin media and Telefonica, So two and.

Okay to form a 50 50, JV that will be second only to BT and size and scale and poised for incredible strategic and financial upside and we're acquiring the best mobile companies, which was to create a clear number two the swisscom. When you put it all together, we have tremendous converged scale in Europe, serving $84 million fixed and mobile RG usage.

Generating $26 billion of aggregate revenue Thats, a strong platform for value creation and as we've shown in Holland and Belgium, each operation generates stable long term free cash flow and represents a real opportunity for further strategic growth and potentially public listing certainly sunrise has shown us that the into.

The traditional demand for crown jewel assets on local exchanges is huge.

Beyond that we're focused on allocating capital just as we've done so thus far we've announced a new $1 billion buyback program I mentioned that when that money is spent we will have purchased around $4.7 billion of our stock since we closed the sale of Germany to Vodafone 16 months ago.

Represents about 40% or more of those proceeds.

Now, we'll look for opportunities and our remaining capital markets, Ireland, Poland, Slovakia, we'll see if theres opportunities there to pursue similar FMC playbook strategies or not.

And we'll continue to invest in adjacent see throughout ventures portfolio, which we conservatively valued today at over 1 billion. Let me just take a second to talk about that.

We've had a really good track record with our venture investing and some recent wins, we were an early investor through our technology portfolio and skills of mobile gaming platform. It just got bought for 3.5 billion that was a 10 x. for us.

The crown Jewel of our sports portfolio was Formula E race series with the conservative value at a quarter of a billion.

We have small but important interesting content platforms in our largest markets. Our infrastructure portfolio was an early investor in edge Connex, which was just acquired by IEC UTI in a multi billion dollar transaction and were actively pursuing ways to monetize or grow our own infrastructure and property related assets, which is an exciting space right now you're following that I'm sure.

So looking forward were mainly focused on four things.

Firstly, delivering stable and long term free cash flow in our core fixed mobile markets I've, just talked about that looking for ways to close the value gap on those assets, which you think are a real and tangible opportunities.

Investing in our own equity story through buybacks of course, we've just added more to our buyback program and then selectively and only when appropriate investing in adjacent and attractive opportunities. That's the strategy. So I'm happy to take questions on any or all of my remarks at the end, but for now our right now going to turn it over to Charlie Charlie to you. Thanks, Mike.

Turning to a consolidated numbers, let's go to page entitled underlying revenue stable.

Total group revenue sort of declined to 1.3% in Q3 only.

On the right hand side of the page, we set on our estimates of the impact to covered.

What it has done to underlying revenue growth, which as you can see it accounts for more than 100% of the Q3 to six months.

In Q3, we estimated a coverage reduce revenues by $41 million compared to $110 million in Q2.

Well the total premiums both accounted for around $30 million it'd be revenues were also impacted by $30 million I'm worried about revenues were just about $9 billion predominantly by roaming revenues.

Cost of revenues accounted for around $6 million or the drag.

No different to revenue streams or other relatively low margin will have compensating operating expense impacts, which is why our adjusted EBITDA growth was not significantly impacted in the quarter.

On the next slide we provide details of our adjusted EBITDA for the women based adjusted EBITDA growth was minus 4% in the quarter, which means year to date growth is minus 3%.

No were confirming our full year guidance to mid single digit Rebased, adjusted EBITDA declined which implies a significant year over year decline in Q4.

Why is this.

2019 sort of material step up in adjusted EBITDA in Q4 versus Q3, whereas in 2020, we expect Q4 EBITDA will be flat to Q3.

This is because we have deferred the entry price rise, but we typically executed in Q4, resulting in a 26 million dollar Delta.

We're still sort of the loans have covered we are onshoring certain customer care operations and have accelerated investments in a number of digital initiatives. Together. This results in an increased spend year on year of $17 million.

We expect these investments to deliver long term savings going forward, but these are after these initial setup costs.

Finally in both the UK and Switzerland, we expect to incur a pre merger integration costs of $8 million of $9 million due to the pending transactions.

Turning to our capital intensity yesterday, we continued to reduce our capex spend versus previous years due to the completion of many of our investments in capacity and roadmap projects as one of the decrease spend that resulted from upgrading our customer premise equipment on the new platforms.

In Q3 reported a capex to sales ratio of 22.3% or 19.9% on a pre lightening basis.

There was a reduction enabled spend in the quarter, but we still succeeded in building a 125000 homes in the anchor in Ireland contributing to a year to date total of 311000 homes.

Well, we're going to complete a further 100000 tons in Q4, assuming Oakland owns affected by the upcoming long term.

In Q4, we do not expect Capex to rise as it did in 2019, so for the full year, we estimate terrific sales pre lightening, we around 20% but.

Because of this reduction in Capex, we remain on track to grow our own FCF mid single digits and Twentytwenty as we set out to the next page.

For Q3 reported or FCF of $552 million on a pre lightening basis $623 million of underlying CF.

All in all markets, except Belgium, when it was flat so underlying growth in CF versus the Q3 2019 numbers.

The Netherlands in particular, so very strong growth rising from $247 million to $348 million year on year.

We expect this underlying growth to continue in Q4 across all markets targeting $500 million of consolidated CF for Q4, including the impact of our lightning investments up from $433 million the previous year, turning to free cash flow, we confirm our guidance of $1 billion of free cash flow for the full year increasing from 542.

These orders year to date.

Turning on the key drivers to achieve this we expect no further material interest payments in Q4 in line with previous years and tax payments will be minimal.

We expect to receive the balance of the shareholder distributions and Vodafone Ziggo, which we expect to be 50% to the upper end of that forward from Germany to euro target range.

These are great working capital is close to $31 million and we expect to be broadly flat for the full year.

Our underlying year to date pre lightning adjusted free cash flow was $789 million demonstrating the continued strong cash flow generation of our businesses.

Turning to our capital allocation on next page great liquidity remained strong.

Reported full company liquidity of $9.3 billion at the end of Q3, including $6.8 billion accounts in the semis.

Referring to the Sunrise client transaction close this will be reduced to $5.4 billion, including approximately $2.9 billion accounts in this race.

If you remember at the close of the Virgin Media currency transaction performance is expected to be $4.7 billion.

Now with that transaction, we will deconsolidate versions revolving credit facility, leaving remain favorable was a $1.2 billion predominately MPC critical resulting in total group liquidity of $5.9 billion, which would contend to provide a degree with excess capital to invest.

We continued to repurchase our stock and approaches $1 billion through the end of October.

Since January of 2019, we repurchased 29% of our market cap, we continue to its repurchase further stroke.

As Mike indicated we are looking to Opportunistically buy back a further $1 billion through 2021.

So, let's turn to up his dividend distribution model comes into a dividend for 2.75 euros pressure going forward. We see this growing dividend distribution policy as a template for future FMC companies as we explore requirements things over time.

In terms of leverage we remain committed to our four to five times leverage targets and I'm very comfortable it's within the range as there is clearly a near term visibility on EBITDA growth as we realize FMC synergies, which allows us optionality to deliver towards the middle of the range and below over time.

With our existing FMC champions, Belgium verticals that are on this call both of long dated debt with an average life of around eight years, and Merck borrowing costs fixed at 2.4% in Belgium, and 4.2% up vertical ziggo.

Those are rubber turns of 4.4 times in the U.S. GAAP basis, where we execution of the percentages of its fixed mobile consolidation.

Whether from Ziggo is continuing to execute the synergies riskmanager and should deliver further from its current 1.25 times.

We completed a number of financing for the quarter, including attractive financings in advance of closing our UK Swiss transactions.

In both the enhanced Switzerland, the companies will be another five times before the benefit of any synergies with average lives around eight years and the cost of debt, new carrier, 4.4% and 3.8% in the PC, which benefits from lower underlying Swiss rates.

Given the completion of refinancings, we do not anticipate having to allocate any of our excess capital to further de leverage these or any of our other credit saw those in.

In conclusion on Tacttthree, so strong customer and broadband performance with higher NPS.

This transaction has been approved in the close around mid November.

On the UK transaction remains on track.

Our underlying cash flow generation remains strong capital intensity established below 20% of sales excluding rising.

We are reconfirming rollout Twentytwenty gardens metrics, namely mid single digit adjusted EBITDA declined mid.

Mid single digit growth and adjusted free cash flow for the full year $1 billion, including revenue construction Capex.

Finally, we are announcing a new $1 billion buyback authorization.

And with that operator over to questions.

The question and answer session will be conducted electronically. If you would like to ask a question. Please do so by pressing star or Astra key Oh by the digit one on your phone in.

In order to accommodate everyone here, we request that you ask only one question.

If you are using a speaker phone. Please make sure. Your mute function is turned off to allow your signal to retire equipment well pause for just a moment to give everyone an opportunity to drink Hill.

And we will take our first question from DJ giant with Evercore.

Good morning, Mike.

Two questions there.

In the UK you'd be reconnecting with their customers and.

And sort of on track them on modification to that plan or the thought about the pricing of the base can you just talk about how much was done what the end customer impact in terms of dollars.

And any outlook on what that could be.

Going forward.

Second more sort of a bigger picture question.

Obviously, all fixed mobile convergence strategy is showing a lot of success and Holland and Belgium, we expect that to come in the UK and Switzerland. Although the next year can you sort of talked about structurally or competitively or how silly. It then you will leave in those two markets the new market one have similar.

Our success and we can get back to pretty healthy EBITDA growth and CPI growth and in that context is there any way to even sort of quantify what sort of the margin benefits are getting I know that John is down on that.

Does that have any sort of profitability measure on on this convergence of would be very helpful. Thank you.

Sure. Thank you get lifted.

Leases on and I'll, let him address the other contract annual best tariff issue of what we've said in the past we would repeat here, though which is we're not giving specific.

Disclosing specific numbers that we've gone back and how many here, but we have said publicly that.

So far the effect of that in the contract modification process has been better than we expected, which means that while our churn from that process was largely in line. We have not had to provide the same level of discounting or or changes to ARPU that we thought would occur so.

In the end, we believe at the end of contract location process. Thus far has been better than we expected, but I'll let loose.

It into that let me just answer the second question.

There's more to add to that leads go ahead is that although I do that now that together something else to add to that.

Yeah.

I think what I characterize it right.

Overall, you have seen strong net debt in the UK. So therefore, you see that the churn numbers end up conflict qualification, it's not really material.

Overall year over year, we are doing much better on Sean.

Obviously, we are a 1% down.

Up to a year ago, we have had the price right.

Started.

So September and October how can hop across the customer base. So therefore, you see also.

The impact.

Hi, all this mid tech and impact.

We'll also obviously flow through into a 2021 so.

All of that we.

We have fully swallow negative way 2020.

Yep and annual best therapy is really just started so it's too soon to know whether it works out about it yet sorry that victory at that site on the FMC question listen I do believe to answer your question in sort of the general we do believe that both the UK, Switzerland.

Can show should show.

Similar trends in terms of both financial trends and operating trends.

What we've seen in Belgium Holland.

There's a couple of things that are the same of course, we look at the synergy estimates there.

Both market share within the range of what we've seen in all the other transactions weve been involved and have been involved in over eight different country merger is whether we're a seller or a buyer or partner with FMC. So there's a lot of data on synergies the adjustment in the case of Holland and Belgium. It was about a 5 billion euros synergy estimate.

And Weve knocked the ball out of the park as I say on both in both countries. So we've got experience in other expenses, we believe the estimates.

The validated don't I know the estimates of the validated in bulk transactions by both sides of the equation.

And we feel really good about those estimates you know the prebuild number in Switzerland, The 6 billion number in.

As the UK those provide a lot of tailwinds financially obviously of course on the operating side. The benefits of FMC are hard to argue that structural reduction in churn.

Consistent and regular improvements in NPS in a competitive market. How does this quad play bundle usage, Belgium, Holland, although the quad play bundle matos being able to provide full package of products and services around connectivity matters, having a mobile operation to cross sell broadband having a broadband platform through cross sale.

Mobile matters.

The statistics of the opportunities that very similar in both countries to what we've seen I can't share with you. The long range plan, but if I could I would you would see similar kinds of profiles that both on the DAU is up the guidance on EBITDA.

EBITDA this year mid single digit margins showed you that three years ago was negative 5% and.

We do think that those same kinds of characteristics of operating and financial are achievable and again I can't Shake My plans, but you should assume that we see that opportunity. Similarly, as do our partners in the case of UK and I think the Sunrise management team as well of course, they won't let us out of the transaction for a long time, so everybody seems to be aligned here and there.

Just to get started.

Thanks, Mike.

Yes, Okay, well take our next question from Michael Bishop with Goldman Sachs.

Yes. Thanks, I just have one question, which is also on UK pricing I just wanted to understand how you think the price versus volume equation has worked in the year not taking price and that's with a view to essentially.

Thinking about next year, given bts means actually some of the moves on you guys I've always seen as well so just in general the pricing environment feels like it's got quite a bit better despites guidance.

Well I think I like that question.

Yeah go ahead.

Correct, yes.

Well once we have all the purple input price right for this year Michael.

And you wanted to make sure.

But we really continue with the momentum that we built up.

Andy.

Especially broadband net.

And but.

He will record have recognized fuel cells.

The market for you to get more rational.

On the price increase side and obviously, we cannot disclose here, what we are going to do but I.

I think.

Overall IP that are pretty positive.

I think the decision made to defer the price rising 20 with the right decision. It had perhaps a marginal impact on volume, although I think the reduce churn and then that will be essential element of our products and services probably had more of an impact on that.

But as you pointed out that the market is clearly expecting from other operators and other operators have made it clear that publicly that they will be taking price rather than 2021. So we'll see we'll decide internally what our best move is but what we think the decision in 2020 with the right one and.

For sure it set us up for a stronger 2001.

And our next question from Ben Swinburne Morgan Stanley.

Thanks, Good morning.

Hi, and good afternoon folks overseas I want to just stay in the UK. If we could two questions. One you guys have had some programming cost pressure I think over the last couple of years.

Probably largely tied to sports I'm wondering if you look out from here. If you see the curve they are spending one way or the other partly bring it up because guys talking about yes.

Some real opportunities in terms of driving down I think entertainment expenses.

So I'm just wondering if you see that in your outlook as well and then sticking with video I know, we don't talk about video much anymore, but this Virgin TV 360 platform. It's a big deal for your position in the market I don't know, how you would compare that to sky Q and I think its I don't think its a new set top boxes I feel like a big cap.

X deployments I want to just make sure that's the case and get a little more color on that product, which launched this quarter.

Yep.

Which again as you said a couple of things that I had revenue of between 60 platform.

Really as a new user interface the horizon for your user interface, which is you know X one plus plus the over revenue you'd expect to see that we think is a game changer.

This market where everybody.

Continue to watch video pretty pretty significantly on the television but.

But it also integrates all the apps and has the fourth was called to secure the full.

Integrated OTI to experience built in so we do think that's a game changer later this year when it rolls out it has been in other markets and Switzerland before without an Ireland MPS.

Anyhow, and NPS rises materially and people see it as the next you know the next generation of video experience, which we need to be part of it and our customers as well.

On the programming point.

Without being specific about any particular programmers I think it's fair to say that across Europe, not just in the UK.

We anticipate.

A different type of discussion with all of our linear providers, whether they be sports or entertainment venue.

You're seeing that in most of our markets were not disclosing it.

And why is that occurring for the same machine here, yet, perhaps while viewership linear viewership remains pretty robust in Europe compared to the U.S.

It's clearly moving the other direction over time, and we are seeing some modest losses and video subscribers. So the idea that we will continue to pay more for linear program in Europe that will continue to play a flat rate, if you will or not customer.

Dependent rates is crazy, it's not going to happen. It's a work in all of our negotiations.

These providers will find is that their desire to go over the top.

Together with the headwinds we feel in the video linear video business.

Will result in better margins over time on the video product.

But I think most importantly on that issue, we're not waiting around for that that transformation. We are integrating apps into boxes today as I mentioned in my remarks. Your IP boxes is rolled out in Poland, Apple App centric network.

Network agnostic, Bob you can roll that is where we have IP rights. So clearly Europe has had in the same direction innovation of RTT apps aggregation of over the top content seamlessly in home entertainment experience and we lead the pack in Europe on that on that on that road map, so similar catching us quite as.

Aggressive or quickly, appearing but I think gopro programming cost pressure ought to be lessening for us over the longer term deal just natural given where the market's evolving.

Yes, I will tell you that most of that Mike.

So I think.

Virgin Media TV through 60.

We think it's a bit better vanskike right.

Right.

Some tonnage and Sky Q doesn't that.

And.

And over the air software.

Ralph date or customer for debt.

And therefore, not high cost and it really relates to lower true fivefold because we.

We know from other markets that that MPS is extremely high and that leads to larger and we were affected revenue.

And on the on the program called Cardwell when you compare from a program incurred 21 to 20, obviously the cost increases flat lots.

This is more due to colder in the long term we are doing exactly what Mike has explained for the overall.

The market.

We want to get much more to rub nickels rights, where we help all apartments on their way to direct to consumer.

We have a lot to offer them from form and then they turn unfolds with fault and on the other side. We are keen on getting more on variable content cost for linear viewing and we have already managed to close some of these contracts and in our models.

And then on to estimate the better leverage the brink of those conversations today, you know years ago that we didnt have any mobile customers today meals.

Ill conclude them you know several have something like 50 million mobile subs.

You guys are searching that's out you know they were at you've seen how well they are driving the bus and you've seen all the DTC guys here looking for mobile partnerships to get launched so we're in a position in all the core markets to play that role.

In Oh Gee is already the launch partner for business across the UK. So we'll be in that position and all these core FMC markets with the mobile platform, which gives us additional leverage of conversations right.

Got it that makes sense. Thank you both.

Okay.

And we'll take our next question from Steve Malcolm with Redburn.

Yeah. Good afternoon, guys I just want to come back to that question on programming cost just clarify if thats, okay and.

And one more quick question after that.

You basically have two large premium sports providers in the UK BT sky, the BG deals largely fixed the sky deals kind of fixed and variable from what you're saying.

Recently, there, but should we assume over time, you are making every effort to make those fixed costs from those two large suppliers more variable given kind of more access to a larger base and ability to grow TT I guess that's question one and then secondly, just on the local listing point, Mike I'm trying to get off this last time right, but when I look.

In Europe, there are two kind of you know.

[music].

Companies about telling that in order to be both trade at very high dividend yields and pretty low multiples. So I guess the question of whats the market missing why would switch it wouldn't be that different is it just because it's a better market or would you consider something a bit more radical say it will be merger to your shareholders in an effort to create value. Thank you.

Well I'll take the second one is that you can be thinking about the first one Charlie chime in here too. If you want I look at I think there's you did ask the same question. That's like this or that there are lots of the motel and that is where it is we think that the dividend as announced a long term free cash flow profile their competitive position in them.

Good place or a winning.

Characteristic I think there was some concern that need to tell them that among shareholders. There specifically related to strategic issues, whether it's the easiest conversation capital expenditures. So I don't think you look upon it and read across the rest of Europe, and say well because the trade here.

You know a Swiss IPO or UK IPO won't trade, while if you just take the vertical developer KPN trade both consumer though.

'cause lead KPN and all the core metrics. If you look at the amounts are year to date results for both companies, It's night and day.

And yet you know that also could be an opportunity for reasonable valuation I lastly, I'll just say that.

Well you could be right in the valuations won't be as robust as perhaps we hoped for they couldn't be any lower than our own valuation.

He just pause there.

So perhaps it wont be nine times, EBITDA and a 6% recast the yield but if you look at where we trade today, creating a local listings with a local following local energy in that marketplace gives you the shop that and manageable with algae correctly in the dividend profile correctly English.

Got it long term value creation that but apparently we're not able to achieve the topco here for reasons, you would know better than me I suppose and so from my point of view, creating value at the Opco, whether it's the way, we sold Germany or the way in which we manage its own it was a valuable created both on the back the core that create value for us and we'll look at all options to address your last point.

Well look at all options to create value.

Value as much as the value gap in our opcos and or whatever that might look like.

Should we assume that youre sort of number one.

Sure.

You bet.

Okay got you know should we assume that you would seek to use any proceeds raised through an IPO just to retire more equity arbitrage a horrible school in Switzerland, possibly against your your group multiple.

I think that you know we generate free cash flow. So we don't need to look at inorganic transactions to raise cash for equity shrinks.

To generate free cash, but look it will be opportunistic you've seen that over the last five years revenue. We've always done that we believe is the right thing both in terms of the opposite in strategic position, we're in and the ability to manage our capital and capital allocation. So nothing's off the table or you would know that about us.

However, I think that you know that the plan a is should be pretty clear that you want to guess programming cost question yeah.

Yeah, My my comments the floor.

More.

Across all told them at cost. So you will now only fair he could the sport premium program in coal fired so that will take the view that more broadly across all our content cost not only the parent.

When it comes to the spot premium obviously, we have to both top notch.

Thanks, Guy still we have today.

It could stay on track and yields.

New York's would come up I think in 18 months from now so.

So yeah, we need to find their way on one hand.

To to help our partner to have the secured revenue stream.

All right.

To sit on from saying more variable and this is something that we will figure out in the market.

It makes the 18 month and then obviously, we will we will share that with you that the idea.

That obviously strategically and generally want to get more more on variable cost and they already have five if it comes to ago. Then obviously, we use all the the exits we are having to two then come to a proper while you plan behind that.

Dick just one thought you fill your negotiating position with those operators the strength of the last eight months given what's happened.

Well I I mean, so first of all we have worked very good too that our ER during the pandemic acting.

Very good and then I mean, the content or contract come into play I think when we are also well hopefully at close.

And then yes, I mean that we are mobile analytics customer and hopefully we have more to offer a full distribution all of them.

Great. Thanks, a lot.

Yes.

And we'll take our next question from Matthew Harrigan with benchmark.

Well. Thank you Mark in your comments that the cable can you kind of highlighted some of the differences between your positioning in the U S.

Operators, a lot more fiber competition over in Europe and.

It would seem to suggest you're pretty explicitly event that you thought the headroom of DOCSIS three one was a little bit less than what you us operator, who are saying and grow that big requires a need for deeper fiber.

And your thoughts as for old El.

Do you think that's a fair characterization that you think that.

With all this capacity being brought on on Fiveg DOCSIS forward, all that you're going to finally see some better App development you can monetize in nursing cool thing, but able to export the light field whole graphic hopping frog and all that but yes.

It feels like you really could see some.

After that the Celleration in your in your perceived value and price the Johnson.

Are you seeing will resume and conferencing and all that thank you.

David I think the a couple of points there the value of our networks is unbearable you can just look at what happened in European infrastructure space.

You know our networks are valuable today, well beyond with a P value them and look for all kinds of reasons that make good sense. The path to continued speed enhancement in our in our fixed networks.

You know we've got multiple paths. We today, we're getting the most out of food out one with a gay because we've already trial, two and a half gig speeds would see that one.

You know that's something that's something we can do to choose to do trial that UK, but we're really focused on 10, Mg or 10 gig and beyond IMMU. One I mentioned, one gig five or six years ago, everybody is like what the heck is that needed for trust me when I say that the 10 gig conversation will be starting and be start and we'll be starting pretty quickly and when we look at our networks, you've got a couple of ways.

Yet there with boxes for that as you mentioned a little bit fall right in line with the U.S. operators charter and Comcast both agreed to be pursuing a strategy like data we could also decided at home.

Yes, PON, where we had because the economics to support that kind of road map. The TMG. So stay tune lots to talk about there.

As you point out lots of cool things with faster speeds and lower latency lots of cool things we can do.

Both with our fixed and mobile networks. You know, we just talk yesterday as a team are going to be eliminated the ideas are hitting that things.

But to be honest with you the real benefits of being in the mobile space for the I.T. application. It's also advantageous to be partners with companies like Telefonica, Vodafone who are leading the way in the development allowed revenue and its partners of ours, we learned a benefit from that too. So I think there's tens of opportunity to monetize networks fixed and mobile continue to.

Stan speed and capacity reduced latency to Fiveg intended and Sky's the limit I think that's really why these networks are being valued where they are.

Thanks Bye.

Yeah.

And we'll take our next question from James Ratcliffe, New Street research.

Yes, thanks, very much and Dayton that two quick questions. Please the first one was just regarding your UK K.P.I. I mean, the customer adds this quarter, where do you look to me like one of the kind of stand out stake as in the release I was wondering if you could kind of just talk us through a bit more what's helped to.

Drives that it adds up.

Even farther than we saw in Q2, I mean is that solely down to being more kind of price competitor, so not having the price rise might it only impacted September.

So I'm a strong performance that I was wondering.

What you can say about how you see that in future quarters as well and then secondly, just interested to get your updated thoughts on the ITD stay I believe that back call. A position you have is now unwinding I think about 30% unwound in the quarter. So you are now running at kind of echo.

Ill make stake with equity exposure on the TV stake again, just interested in your thoughts on the kind of rationale so continuing to hold back.

And what you want to do is at stake longer term. Thank you.

I'll take the second one lives you can take the first one looking at night TV as he would know James when we originally acquired out position sometime though.

Our average cost with well over two pounds. Fortunately, we powered that position and had virtually no economic exposure to the ups and downs like TV as those cars are expiring, we had a choice to make and we decided to average down price around 70% or more so we're essentially owning the shares that the market thinks we own.

<unk> increased 10 percentage points in previous years, so that leads to lower term.

And this is an effect, which we see it.

It's not only in Q2 Q3, it's more mid term and obviously also we are making up for the children of entrust end up contract modification for that said before.

And then on the other hand side, although we have closed all our retail stores, you must remember that and.

We have been able to accelerate sales. So we not only about much of your buffer or previous years in terms of sales and and I mean acquisition.

Brian.

If more under pressure right. So the it's a while the back book, it's getting more rational the acquisition pricing is still.

The heavy competition, we are not going down to price levels, and we get our fair share and that's a combination and also obviously fixed mobile convergence to help them out right. So we have launched it.

Oh 15 months ago, and also that you would see that more more contributing.

So therefore, maybe long explanation, but so short story, it's not that we have done anything special more commissions or no was ER acquisition prices enormously or huge retention and we can only do this for one quarter. It isn't automatic effects of the long term.

Either more did so better NP, four custom lots and lots of them.

Like he left so I would kind of suggest that the rate you've seen in Q3 could probably be sustained any chance it towards into Q4 as well.

Hey, Jim.

Great. Thank you.

And we'll take our next question from Andrew be almost every occasion.

Hi.

Just following on from Steve's earlier aren't good question I mean, I guess on standpoint relative to the current.

Liberty Global equity valuation.

What is what do you thinking it's a rough timeline to make listings I'm, giving the states to the European sector valuations why why do you think this is about a mid term value creation, Boston private market or corporate transactions.

Given you own a fairly unique footprint and the fact that seems to be a pretty wide Gulf between public and private.

Based for the operating assets and also the underlying infrastructure.

And also if I can go so like if when you say strategic investments in adjacent areas can you explain what you're meaning I mean I seem to.

Fiber and tone is unconscionable things or in the case, but what about geographic expansion exclusive content and is there anything you can rule out.

Yeah, Okay, two questions missing out on the IPO crushing.

And the weapons to public and private multiples and other sort of corporate transaction, you know us we're always going to be opportunistic.

It isn't like we have one and you will see that happen all costs, you know stand standby or stand stand down we're going to be looking at all sorts of opportunities and sometimes it could be do factor you know who knows but we do know that they're taking action and being sort of on the for sure. When it comes to value crystallization things of that nature is there.

Posture for us and so you'll see US look at these opportunities may not take advantage of them. We might so we'll always be opportunistic and focused on creating value first and foremost and would never exclude any particular financial corporate or strategic approach to doing that without getting into the details of what those might look like.

Good.

Valuations or things of that nature, just rest assured that we're you know you know us you've seen us you've watched our reported and adjusted his dad, Yeah. We're always going to do what we think is the best for long term value creation on.

In terms of adjacent tea.

Yes, certainly we can do a certain things out any you know what geographically our focus is principally in Europe. That's what we think the adjacent to reside because we have a strong pensionable footprint in Europe and so for the most part the adjacent geographically would be in Europe, We don't exclude you know with.

And absolutely anything else that you should assume that most of those games such as the year focused and adjacent GCB technology and content focused things that enable our core fixed mobile converged platform. So the things that we've done you know investments we've made in our tech platforms and thinks it Charlie and they're working on.

In infrastructure and the things you know content team or investing in these are all opportunities to not just make money in the underlying investment, but create value relationships long term partnership with our operating assets to the adjacent these are sort of you know structural in terms of our operations and our technology platform.

And they are in a geographic and it's also thirdly, using our expertise I mean, one thing we know how to do is find cell companies. One thing we know how to do is finance and manage and and structure businesses or we have an incredible platform at our UK wanting to be a vast knowledge of where things are happening protect that things are going.

Technologically and so the adjacent is also exists in our talent pool and our expertise in our specific you know capabilities in this marketplace. It doesn't the three day countries were referring to and I would you know if you stick with those three lenses I think you'd be you'd be close to where we're heading.

Okay. Thanks, and just on the timeline from a couple of things is there anything you can say without breaking the rules.

I don't think so yeah, no I wouldn't want to get into that right now.

And we'll take our next question from Christian thing then the HSBC.

Yeah, Hi, thanks.

Thanks, I have actually a question on on the Swiss business it looks like.

The U.P.C.S. is finally stabilizing its aren't you trends but.

But financially I mean, obviously, we have not seen a substantial improvement it.

Why what's the structural issue that the EBITDA and if you know weaker.

Then the than the top line performance and are you still investing in the digital infrastructure I was expecting a bit more let's say closing the gap between the revenue trends and the EBITDA trends I mean, I know going forward now that you're well on sunrise thinks will materially change anyway, but just trying to understand that the short term dynamics with it.

Like the Q4, and maybe Q1 next year. Thanks.

And that seems to Charlie you want to take us out of that.

Yeah. This is Bob piece, there maybe like.

We see now in the quarter that in quarter momentum really calls for the broadband net adds in the last month.

And just really to me, but like always in the cable business. Your trend business show. Your last 18 months 24 months net adds and price effects flow through your PML.

But like pull much as we were able to stabilize the key cash flow and again its toll free cash flow cool. So with this we see the momentum for doing around India in the coming years. This will show Charlie.

Yeah, you're right that there is obviously impressive digitization true across the board.

'cause it accelerates what we're going to be good return investments anyway. The only I think Christian we should bear in mind. It there's a lot of switch across our cost structure.

From Capex to Opex, which actually is a good thing. So for example, if you provide outpace services.

Which is already in a more efficient way of providing Ah I T support that's actually Opex revenue base. It depends its capex. So that's one of the reasons why sometimes it seems counterintuitive, but I'll see if it's growing so much but our core EBITDA associated decline and it was a bit of an accounting impact was muted material I'm not trying to quantify that for you for the group as a whole actually it or the euro.

Yeah.

Okay, and then I have one follow up regarding the UK deal looks like.

Like here and with respect timing and kind of your.

Scheduling or expecting to put kind of middle of next year that implies actually is that you think it's going to the UK levels and rather than staying at the E. U is that a fair assumption.

Well I was outside of our control really I think you know it could that timeframe could also be consistent with the longer term the valuation from you right. So but you know it's really in the hands of the commission they'll determine or whether.

Whether to decide the case or refer back and we were prepared for the longer term process. If that's where it goes and we'll have to engage with CNN off because of this year and then that gets understand outcome on the transaction, which we think is absolutely a positive for the UK consumer or the UK business environment and.

No as virtually no competitive issues at all.

I think it's probably the cleanest simplest transaction any regulators look at so we're excited to keep the process moving and I think the next year's attack and we've always talked about it and so you know what we're hoping to make that happen.

Great. Thanks, Good luck all right operator, I think yes, you got it I think that's it for US operator, and I will just thank everybody for joining us letting little over an hour or less if you're still onto appreciate that just to point out to the IR team in London, and Denver are always available.

For more questions and then on standby, so feel free to reach out to them warranty and Charlie or anybody here that that you'd like to chat with the doctors. We always appreciate your input questions and we look forward to talking to you in three months or so between now and then to stay safe and well thanks very much everybody take care.

Ladies and gentlemen, this concludes Liberty Global's third quarter 2020, Investor call. As a reminder, a replay of the call will be available in the Investor Relations section of Liberty Global's website. There you can also find a copy of today's presentation material.