Full Year 2023 Liberty Latin America Ltd Earnings Call

Operator: Good morning, ladies and gentlemen, and thank you for standing by. Today's call is being recorded. I'll turn the call over to Eduardo Diaz-Corona, Senior Vice President and General Manager of Liberty Puerto Rico. Good morning, and welcome to Liberty Latin America's full year 2023 investor call. At this time, all participants are in listen-only mode.

Good morning, ladies and gentlemen, and thank you for standing by.

Today's call is being recorded.

I'll turn the call over to Eduardo D S Corona Senior Vice President and General manager of Liberty, Puerto Rico.

Good morning, and welcome to Liberty Latin America's full year 2023 investor call.

At this time all participants are in listen only mode. Today's formal presentation materials can be found under the Investor Relations section of Liberty Latin America's website at Www Dot LLS Dot com. Following today's formal presentation instructions will be given for a question and answer session. As a reminder, this call is being.

Operator: Today's formal presentation materials can be found in the investor relations section of Liberty Latin America's website at www.lla.com. Following today's formal presentation, instructions will be given for a question and answer session. As a reminder, this call is being recorded. Today's remarks may include forward-looking statements, including the company's expectations with respect to its outlook and future growth prospects, and other information and statements that are not historical facts. Actual results may differ materially from those expressed or implied by these statements.

Recorded.

Today's remarks May include forward looking statements, including the company's expectations with respect to its outlook and future growth prospects and other information and statements that are not historical fact.

Actual results may differ materially from those expressed or implied by these statements for more information. Please refer to the risk factors discussed in Liberty Latin America's Most recently filed annual report on Form 10-K, along with the associated press release Liberty Latin America disclaims any obligation to update any.

Operator: For more information, please refer to the risk factors discussed in Liberty Latin America's most recently filed annual report on Form 10-K, along with the associated press release. Liberty Latin America disclaims any obligation to update any forward-looking statements or information to reflect any change in its expectations or in the conditions on which any such statement or information is based. In addition, on this call, we will refer to certain non-GAAP financial measures that are reconciled to the most comparable GAAP financial measures, which can be found in the appendices to the presentation, which is accessible under the investors section of our website.

Forward looking statements or information to reflect any change in its expectations or in the conditions on which any such statement or information is based.

In addition on this call we will refer to certain non-GAAP financial measures, which are reconciled to the most comparable GAAP financial measures, which can be found in the appendices to the presentation, which is accessible under the investors section of our website.

Balan Nair: I would now like to turn the call over to our CEO, Mr. Balan Nair. Thank you, Eduardo, and welcome everyone to Liberty Latin America's fourth quarter results presentation. I'll begin with a group overview and an overview of our operating results by reporting segment. Chris Noyes, our CFO, will then follow with a review of the company's financial performance. After that, we will get straight to your questions.

I would now like to turn the call over to our CEO Mr. Balan Nair.

Thank you Eduardo and welcome everyone to Liberty Latin America's fourth quarter results presentation.

I'll begin with our group highlights and an overview of our operating results by reporting segment, Chris Noyes. Our CFO will then follow with a review of the company's financial performance.

After that we will get straight to your questions as always I'm joined by my executive team from across the region and I will invite them to contribute as needed during the Q&A following our prepared remarks.

Balan Nair: As always, I'm joined by my executive team from across the region, and I will invite them to contribute as needed during the Q&A following our prepared remarks. As a point of housekeeping, we will both be working from slides, which you can find on our website at www.lla.gov. Starting on slide four, and now highlights for the year.

A point of housekeeping, we will both be working from slides, which you can find on our website at www Dot LLE dot com.

Starting on slide four and I'll highlight.

Highlights for the year.

Balan Nair: We consistently grew our high-speed internet and postpaid mobile basis through the year, adding 186,000 subscribers in total. This represents an overall increase of 5% in our base and is evidence of the volume growth potential in our region, as we have previously discussed. Broadband performance is particularly robust, with growth across our reporting segment. We reported adjusted OEBDA of $1.7 billion in the year, representing a 6% year-over-year increase.

We consistently grew our high speed Internet and postpaid mobile basis through the year, adding 186000 subscribers in total.

This represents an overall increase of 5% in our base and is evidence of the volume growth potential in our region. We have previously discussed.

Broadband performance is particularly robust with growth across our reporting segments.

We reported adjusted OIBDA of $1 7 billion in the year, representing a 6% year over year increase this is Beth rebates growth performance since 2019 and was driven by double digit growth in CSW, Caribbean, Panama and Costa Rica.

Balan Nair: This is our best rebase growth performance since 2019 and was driven by double-digit growth in CNW Caribbean, Panama, and Costa Rica; we grew despite the shortfall in pottery. We continue to also allocate capital for our buyback programs with $300 million between stock and convertible purchases during the year. We anticipate that the convertible bond will represent the maturity of our buyback this year with $220 million currently outstanding and due in July.

We grew despite the shortfall in Puerto Rico.

We continue to also allocate capital for buyback program $300 million between stock and convertible purchases in the year.

We anticipate that the convertible bond will represent the majority of our buyback this year with 220 million currently outstanding and due in July.

Balan Nair: Finally, we are making progress with our key business integration activity in Puerto Rico, with over 80% of our customers now successfully moved to a new mobile call and IT platform. I'll provide more details later in the presentation, but the key message here is that we are on track with the timeline we communicated when we last updated the market in November, referring to slide five. I'll begin our operating review with C&W Caribbean, where we saw good momentum throughout the year, consistently adding subscribers and positioning the business to continue its gross profile in 2024. Starting on the left of the slide with our subscriber edition, we delivered nearly 100,000 additional subscribers across internet and mobile post pages in the year. This represented a 9% uplift in ads year over year and was driven by growth of over 30% in Jamaica. Our FMC strategy continues to drive performance in these two product lines, growing volumes and improving our churn level. We intend on taking price increases this year, consistent with inflation.

Finally, we are making progress on key business integration activity in Puerto Rico.

80% of our customers now successfully moved to our new mobile core and IP platform.

I'll provide more details later in the presentation, but the key message here is that we are on track with the timeline, we communicated when we last updated the market in November.

Turning to slide five.

Ill begin our operating review, but CSW Caribbean, where we saw good momentum throughout the year consistently adding subscribers and positioning the business to continue its growth profile in 2024.

Starting on the left of the slide with our subscriber additions, we delivered nearly 100000 additional subscribers across internet and mobile postpaid in the year.

This represented a 9% uplifting adds year over year and was driven by growth of over 30% in Jamaica.

Our FMC strategy continues to drive performance in these two product lines growing volumes and improving our churn levels.

We intend on taking price increases this year consistent with inflation.

Balan Nair: We will be tactical and thoughtful about it, to optimize price increases versus churn and retention givebacks. Moving to the center of the slide, and our revenue by product. The pie chart depicts the well-diversified nature of CNW Caribbean's revenue, with B2B and consumer fixed the largest elements, followed by consumer mobile. However, revenue was flat year over year as underlying growth was offset by the discontinuation of the transit business, which we have mentioned throughout the year.

We'll be tactical and thoughtful about it to optimize price increases versus churn and retention give backs.

Moving to the center of the slide and our revenue by product. The Pie chart depicts the well diversified nature of CSW Caribbean revenue with BBB and consumer fixed the largest elements followed by consumer mobile.

Revenue was flat year over year underlying growth offset by the discontinuation of transit business.

We have mentioned throughout the year.

Balan Nair: Adjusting for this, our rebase growth rate for the year would have been nearly 300 basis points higher. Overall, 2023 was a good operational year for CNW Caribbean, and as Chris will come on to, this helped drive strong double-digit adjusted OEB. Moving to slide six in our CNW Panama segment, starting on the left of the slide.

Adjusting for this our rebased growth rate for the year would have been nearly 300 basis points higher.

Overall 2023 with a good operational year, plus USW Caribbean and as Chris will come onto this helped drive strong double digit adjusted OIBDA growth.

Moving to slide six and <unk>, Panama segment, starting on the left of the slide we continued our broadband momentum in 2023, adding 29000 subscribers, which was 12% higher year over year.

Balan Nair: We continued our broadband momentum in 2023, adding 29,000 subscribers, which was 12% higher year over year. We are continuing to invest in our network, expanding and upgrading with FTTH home passes, and I'm pleased to say that only 6% of our footprint is now covered by COVID-19. Our focus is to reduce this substantially by the end of 2021. In Mobile, we reported modest postpaid losses driven by retail disruption during some protests in the quarter.

We are continuing to invest in our network extending and upgrading with FTE DH home passes and I'm pleased to say that only 6% of our footprint is now covered by copper.

Our focus is to remove to substantially by the end of 2024.

In mobile we reported modest postpaid losses, driven by retail disruption during some protests in the quarter.

Balan Nair: Looking ahead, we are focused on the prepaid to postpaid migration, increasing the use of our digital channels, improving the effectiveness of our campaigns, and achieving better retention, a similar strategy to the one which has brought us success in neighboring Costa Rica. Moving to the center of the slide and our revenue streams, which in aggregate drove our top line 5% higher in the year. Growth was driven by B2B and fixed products, which were up by 12% and 7%, respectively.

Looking ahead, we are focused on prepaid to postpaid migration, increasing the use of our digital channels, improving the effectiveness of our campaigns and achieving better retention.

Similar strategy to the one which has brought us success in neighboring Costa Rica.

Moving to the center of the slide and our revenue streams, which in aggregate drove our top line, 5% higher in the year.

Growth was driven by BTB at fixed products, which were up by 12% and 7% respectively.

Balan Nair: B2B had a strong year following a number of high-profile contract wins and growth in underlying recurring revenues. Our fixed performance was supported by higher volume from our successful commercial strategy, including a focus on triple play plans, which now represents over half of our customer base. In mobile, revenue was broadly flat.

<unk> had a strong year following a number of high profile contract wins and growth in underlying recurring revenue.

Our fixed performance was supported by higher volume from our successful commercial strategy, including a focus on triple play plans, which now represents over half of our customer base.

In mobile revenue was broadly flat and as mentioned we are focusing on our strategy to drive growth in 2024.

Balan Nair: And, as mentioned, we are focusing on a strategy to drive growth in 2025. We plan on moving our prepaid pricing up through a thoughtful value ladder. And finally, to our integration update in the lower right of the slide. We have made good progress with our plans and achieved 70 million of total one-rate synergies by the end of 2020, of which approximately 20 million are related to capital, providing a tailwind for the business into 2020. The main outstanding area is to complete the migration of acquired customers. To date, we have successfully brought across 100% of the prepaid base, and we plan to have all customers across in the first half of the year. Note that this is not expected to be as challenging as in Puerto Rico, given our existing mobile platforms and capabilities in Panama. Next to slide seven and Liberty Pottery, starting on the left of the slide.

We plan on moving our prepaid pricing up through a thoughtful value ladder.

This and adjustments to postpaid pricing is expected to drive mobile revenue growth this year.

Finally to our integration update in the lower right of the slide.

We have made good progress with our plans and achieve $70 million of total run rate synergies by the end of 'twenty three.

Richard Proximately 20 million related to Capex, providing a tailwind for the business into 2024.

The main outstanding area is to complete the migration of a quiet customers to date, we have successfully brought across 100% of the prepaid base and we plan to have all customers across in the first half of the year.

Note that this is not expected to be as challenging as in Puerto Rico, given our existing mobile platforms and capabilities in Panama.

Next to slide seven and Liberty, Puerto Rico.

Starting on the left of the slide.

Balan Nair: We delivered a robust year of in-net additions, growing our subscriber base by 4%. Our business has continued to invest in products and infrastructure with over 50,000 new private lines to the home, passed or upgraded to five visitor homes in the year, an increase of over 20 percent. We now have 150,000 fiber-to-the-home, or 13% of our network, with FTTH, while the majority of HSV is at DOCSIS 3.1. Turning to mobile, we have had a challenging year, particularly in the fourth quarter as we accelerated our migration efforts. I would highlight a couple of points.

We delivered a robust year of in net additions growing our subscriber base by 4%.

Business has continued to invest in products and infrastructure with over 50000, new fiber to the home.

Passed or upgraded to fiber to the home in the year, an increase of over 20%.

Now have 150000 fiber to the home or 13% of fund net DTA.

PTH, while the majority of HFC is that DOCSIS three one.

Turning to mobile we have had a challenging year, particularly in the fourth quarter as we accelerated our migration efforts.

I would highlight a couple of points here.

Balan Nair: Firstly, we have been impacted by the withdrawal of ECF funding for schools in Puerto Rico. This is a program funded by the Department of Education. This drove 13,000 subscriber losses in Q4 2023, and we anticipate a further 50,000 headwind in Q1 2023. Our group for these customers is less than half our average across. Secondly, I mentioned our new prepaid offers during the last call, and these have started to show positive results. Overall, however, sales have been challenged as we have repurposed our in-store customer-facing colleagues to focus on migration activities. This will reverse once we are through with the migration, with our sales force primed to re-factor towards thriving volume growth. We also plan to bolster this unit with our proposed acquisition of boost customers from dish networks later this year. These actions should help drive an anticipated inflection in the second half, as I'll go on.

Firstly, we have been impacted by the withdrawal of ECF funding for schools in Puerto Rico. This.

This is a program funded by the Department of Education. This drove 15000 subscriber losses in Q4, 2023, and we anticipate a further 50000 headwind in Q1 2024.

Our group of these customers is less than half our average across the base.

Secondly, I mentioned, our new prepaid office during the last call and this has started to show positive results.

Overall, however sales have been challenged as we repurpose our in store customer facing colleagues to focus on migration activities.

This will reverse once we get through the migration with our sales force trying to re factor towards driving volume growth. We also plan to bolster this unit with our proposed acquisition of boost customers from dish networks later this year.

These actions should help drive an anticipated inflection in the second half that's I'll come on to.

Balan Nair: In the center of the slide, we show the revenue mix in Puerto Rico and our overall 3% top-line decline in the year. This was driven by growth in our fixed consumer and B2B operations, being more than offset by mobile challenges. We plan to reverse the mobile trend in the second half of 2020 when we are done with the migrations and our stores plus call center channels and get back to selling. And finally, to our integration update. We have made significant progress with migration activities since we last updated the market in November and have now moved over 800,000 customers to our network and billing platforms. This represents nearly all of our prepaid base and over 90% of our postpaid base and over 40% of our B2B customers. We have stopped selling new consumers on the AT&T IT stack.

And the incentive to slide we showed the revenue mix in Puerto Rico, and our overall, 3% top line decline in the year.

This was driven by growth in our fixed consumer and BBB operations.

Being more than offset by mobile challenges.

We plan to reverse the mobile trend into second half of 2024.

When we get done with the migrations in our stores plus call center channels and get back to selling.

Finally to our integration update.

We have made significant progress at migration activities. Since we last updated the market in November and have now moved over 800000 customers to our network and billing platform.

This represents nearly all of our prepaid base and over 90% of upload speeds and over 40% of our BBB customers.

We have stopped selling new consumers on the AT&T and.

Balan Nair: And this is a major step in our integration. We continue to anticipate completing the project in April and ending the TSAs in June. This will drive volatility in the first half, but we anticipate achieving monthly adjusted OEB of above $45 million at some point in the second half of the year. Clearly, Puerto Rico is a tale of two... We will get through the migration and exit the TSAs by the end of this quarter, and then we will redirect our teams to sell using the flexibility of our new, Turning to slide 8, and Liberty Costa Region, starting on the left of the slide. We saw a stable end to the year for broadband subscriber base in what is our most competitive fixed market. We continue to expand our footprint, adding over 40,000 fiber-to-the-home homes in the year, taking our total network to 750,000 homes.

And this is a major step in our integration.

We continue to anticipate completing the project in April and ending the TSA is in June.

It will drive volatility in the first half however, we anticipate achieving monthly adjusted or EBITDA above $45 million at some point in the second half of the year.

Clearly, Puerto Rico is a tale of two paths, we will get through the migration and exited TSA is by the end of June.

Dan.

<unk> redirect our teams to sell utilizing the flexibility of our new systems.

Turning to slide eight and Liberty study.

On the left of the slide.

We saw a stable end to the year for broadband subscriber base and what is our most competitive fixed market.

We continue to expand our footprint, adding over 40000 fiber to the home homes in the year, taking our total network to 750000 homes passed.

Balan Nair: We now have 20% of our network on FDTH, and we expect that to be about 40% by the end of this year. In mobile, we grew net ads again, reporting our strongest quarter of the year in Q4 and taking the year's postpaid subscriber ads to 87,000. FMC continues to be a key commercial factor driving this. We have also launched our first 5G trials and are prepared to be at the forefront of this development when spectrum is allocated by the regulators, moving to the center of the slide. Consumer Mobile remains our largest product with close to 60% share of revenue.

We now have 20% of our network on S. Dth, and we expect that to be above 40% by the end of this year.

In mobile we grew net adds again.

Putting our strongest quarter of the year in Q4, and taking the years postpaid subscriber adds 287.

FMC continues to be a key commercial factors driving this growth.

We have also launch of plus five trials and are prepared to be at the forefront of this development spectrum is allocated by the regulator.

Moving to the center of the slide.

Consumer mobile remains our largest product close to 60% share of revenue.

Balan Nair: This is followed by a consumer-fixed business representing just nearly 30%, and then a small but fast-growing B2B operation. Finally, our integration activities are now substantially complete, with some smaller TSA-supported activities anticipated to be migrated this year. Moving to Slide 9, our Liberty Network segment. This continues to be a great business for us, with exceptional free cash flow generation, but there is some volatility from quarter to quarter, driven by non-recurring and often non-cash factors that provide some visibility of the underlying trends in the business. On the left side of the slide, we present the third-party monthly recurring revenue for December in each of the last three years. Here, you can see that the business grew at a healthy top-line CAGR of 8% over the period.

This is followed by consumer fixed business, representing just nearly 30% and then a small but fast growing <unk> operations.

Finally, our integration activities are now substantially complete with some smaller TSA supported activities anticipated to be migrated this year.

Moving to slide nine and our Liberty networks segment.

This continues to be a great business for us with exception of free cash flow generation, but there is some volatility from quarter to quarter, driven by nonrecurring and often noncash factors.

To provide some visibility of the underlying trends in the business on the left side of the slide we present the third party monthly recurring revenue for December each of the last three years.

Here you can see that the business grew at a healthy topline CAGR of 8% over the period.

Balan Nair: Enterprise has been the fastest growing company, up 9% relative to 7% in whole sales, driven by increased volume market share as we sell our value-added services. Lastly, in December, we announced a collaboration with GoldData to connect key data center locations in Cuerzaro, Mexico, with the U.S. This will open up a new subsea route from Veracruz in Mexico to Apalachee Bay in the Florida Panhandle and from Cancun to North Miami.

Enterprise has been the fastest growing up 9% relative to two 7% in wholesale driven by increased volume market shares we drove sales of our value added services.

Lastly in December we announced a collaboration with gold data to connect key data center location in Queretaro, Mexico with the U S.

This will open up a new subsea route from various crews in Mexico, two Apalachi Bay in the Florida Panhandle and from Cancun to North Miami.

Balan Nair: Liberty Networks will interconnect with the new system, providing an additional route for the increasing Columbia and Panama traffic and increasing capacity on an existing route CFX, which provides the lowest latency route to the U.S. Finally, to slide 10 and our strategic focus areas as we look to 2024 and longer-term shareholder values. These priorities are split across three pillars and consistent with those we have previously identified,

Liberty networks with interconnect with the new system, providing an additional route for the increase in Colombia, and Panama traffic and increasing capacity on existing routes see FX, which provides the lowest latency route to the U S. Today.

Finally to slide 10.

Our strategic focus areas as we look to 2024 and longer term shareholder value creation.

These priorities are split across three pillars and consistent with those we have previously identified.

Balan Nair: Networks, and like. We have progressed our strategy to create a giga-ready network, adding or upgrading 350,000 homes in 2020. And in 2024, we plan to add another $350,000 to $400,000. Over 80% of our network is now capable of receiving 1Gbps, and we are targeting approximately 95% by the end of this year.

Netflix in 19.

We have progress our strategy to create a giga ready network, adding or upgrading 350000 homes in 2023.

And in 2024, we plan to add another 350 to 400000 homes.

Over 80% of our network is now capable of receiving one gig speeds and we are targeting approximately 95% by the end of this year.

Balan Nair: As previously mentioned, the new mobile core in Puerto Rico is now fully operational, and we are strengthening our 5G position in Puerto Rico, specifically through the announced acquisition of Spectrum there, while preparing for 5G launches in other markets with trials. Second, a commercial approach. We continue to focus on reducing churn, as this is a material value driver for us commercially and a KPI for our management. Our push to drive FMC adoption is aligned with this, and we continue to see good traction with our offer. Delivering a strong digital platform is vital to meeting our customers where they want to interact, improving the customer journey, and also an important area where we can drive cost efficiency. In 2023, we achieved 18% digital sales across the group, and the target is to get into the low 20s in 2025. Product development includes investment across our portfolio, but specifically in the high-growth B2B segment and driving eSIM enablement. Lastly, in this area, customer care is always a key focus, with Quick Connect for installation proving popular, and our self-care app adoption increasing.

As previously mentioned, the new mobile core and Puerto Rico is now fully operational.

We are strengthening our <unk> position in Puerto Rico, specifically through the announced acquisition of spectrum, there, while preparing for <unk> launches in other markets with trials.

Second our commercial approach, we continue to focus on reducing churn. This is a material value driver for us commercially and the kpis for our management team.

Our push to drive FMC adoption is aligned with this and we continue to see good traction with our office.

Delivering our strong digital platform is vital to meeting our customers, where they want to interact with this improving the customer journey and also an important area, where we can drive cost efficiency.

In 2023, we achieved 18% digital sales across the group and the target is to get into the low twenty's in 2024.

Product development includes investment across our portfolio, but specifically in the high growth <unk> segment, and driving Esim and Neal Goldman.

Lastly in this area customer case all of these are key focus with quick connect for installation proving popular and our self care app adoption increasing.

Balan Nair: Third and finally, Capital Allocation. We completed the monetization of our tower assets in five or six markets, with Bahamas to complete in the coming months. We also continue to work towards getting the required approvals for the DISH spectrum and mobile subscribers in Puerto Rico and USVI later this year. We continue to see a lot of value in our stock and have a buyback program in place. This year, our focus will be on redeeming the residual $220 million of outstanding convertible notes, but we will also look to continue repurchasing, particularly at the current level. Our balance sheet remains in great shape with a long-dated maturity profile.

Third and finally capital allocation.

We completed the monetization of our tower assets in five or six markets Bahamas to complete in the coming months.

So continue to work towards getting the required approvals for the dish spectrum and mobile subscribers in Puerto Rico and USPI later this year.

We continue to see a lot of value in our stock and have a buyback program in place. This.

This year, our focus will be on redeeming the residual $220 million of outstanding convertible notes, but we will also look to continue repurchasing stock.

Particularly at the current levels.

Our balance sheet remains in great shape with a long dated maturity profile.

Christopher Noyes: And through adjusted orbiter growth, we anticipate our leverage will naturally de-lever towards three and a half in the coming years. Finally, as always, we will continue to consider inorganic opportunities, which can drive additional stakeholder value, including opportunities to combine and rationalize infrastructure. With that, I'll pass you over to Chris Noyes, our Chief Financial Officer, who will talk you through our financial performance before we take your questions.

And true adjusted OIBDA growth, we anticipate our leverage will naturally deleverage with three and a half in the coming years.

Finally, as always we will continue to consider inorganic opportunities, which can drive additional stakeholder value, including opportunities to combine and rationalize infrastructure assets.

I'll pass you over to Chris Noyes, Our Chief Financial Officer, who will talk you through our financial performance before we take your questions Chris.

Christopher Noyes: Thanks, Balan. On this slide, we highlight both our consolidated Q4 and full year 2023 results versus the prior year. Q4 is the first quarter where we didn't compile against VTR, which was deconsolidated at the start of Q4 2022. We reported revenue of $1.16 billion in Q4 and $4.5 billion for 2023, reflecting a 1% rebase decline in Q4 and flat full-year rebase growth. As a reminder, we discontinued a legacy non-core B2B voice transit arrangement in C&W at the start of 2023, which depressed this year's quarterly revenue by $10 million and full-year revenue by $40 million, adversely impacting our rebase growth rates by about 1%. Our best rebase revenue growth performers on a full year basis were CNW Panama, Liberty Costa Rica, and Liberty Network. We delivered adjusted OEBDA For both periods, rebased adjusted OEBDA growth was 6% year over year, with double-digit performances in Liberty Costa Rica, CNW Panama, and CNW Caribbean.

Thanks pound on this slide we highlight both our consolidated Q4 and full year 2023 results versus the prior year Q4 is the first quarter, where we didn't comp against BTR, which was deconsolidation at the start of Q4 2022, we reported revenue of $1 6 billion in Q4 and four.

$5 billion for 2023, reflecting a 1% rebased decline in Q4 and flat full year Rebased growth as a reminder, we discontinued our legacy noncore BTB voice transit arrangement and seen debut at the start of 2023, which depressed this year's quarterly revenue by $10 million and full year revenue by 40.

Adversely impacting our rebased growth rates by about 1%.

Our best Rebased revenue growth performers on a full year basis, we're seeing W. Panama Liberty Costa Rica, and Liberty networks, we delivered adjusted OIBDA of $432 million in Q4, and $1 7 billion for the full year for both periods Rebased adjusted OIBDA growth was 6% year over year with double digit perf.

<unk> in Liberty, Costa Rica, CDW, Panama, and CW Caribbean, we achieved our 2023, adjusted OIBDA guidance, and a 37, 7% margin, which improved over 100 basis points as compared to 2022.

Christopher Noyes: We achieved our 2023 adjusted OEBDOT guidance and a 37.7% margin, which improved by over 100 basis points as compared to 2022. For both reported revenue and adjusted OEBDA, our Q4 results showed sequential improvement to Q3 in absolute terms. Slide 13 recaps our segment results, and I will focus on Q4 specifically. Starting with CNW Caribbean, we reported $366 million of revenue in Q4, reflecting flat year-over-year rebase growth, and adjusting for the aforementioned transit revenue, rebase growth would have expanded to 3%. Specifically, we achieved rebased residential mobile and fixed revenue growth of 5% and 3%, respectively, over the prior year quarter, helped in large part by 70,000 postpaid and 27,000 broadband additions since the beginning of 2023. Adjusted OEBDA expanded significantly in Q4 to $160 million for 16% rebase growth.

For both reported revenue and adjusted OIBDA. Our Q4 results showed sequential improvement to Q3 in absolute terms.

Slide 13, recaps, our segment results and I will focus on Q4, specifically, starting with <unk> Caribbean, We reported $366 million of revenue in Q4, reflecting flat year over year Rebased growth and adjusting for the aforementioned transit revenue Rebased growth would have expanded to three <unk>.

Percent.

Specifically, we achieved rebased residential mobile and fixed revenue growth of 5% and 3% respectively over the prior year quarter helped in large part by 70000 postpaid and 27000 broadband additions since the beginning of 2023 adjusted OIBDA expanded significantly in Q4 to one.

Third $60 million for 16% Rebased growth. The primary driver of this growth was due to reductions in direct cost, especially with respect to handset in programming expenses and lower bad debt expense as a result of our cost improvement we drove our adjusted OIBDA margin to nearly 44% in Q4 and 42% for the full year.

Christopher Noyes: The primary driver of this growth was due to reductions in direct costs, especially with respect to handset and programming expenses and lower bad debt expenses. As a result of our cost improvement, we drove our adjusted OEBDA margin to nearly 44% in Q4 and 42% for the full year. Next to cable and wireless, Panama.

Next to cable and wireless Panama. The business continued its strong performance into Q4, delivering $206 million of revenue and $67 million of adjusted OIBDA at highest totals of the year revenue expanded by 2%, while adjusted OIBDA increased by 17% year over year Q4 revenue growth was driven.

Christopher Noyes: The business continued its strong performance into Q4, delivering $206 million of revenue and $67 million of adjusted OEBDA, its highest totals of the year. Revenue expanded by 2%, while adjusted OEBDA increased by 17% year over year. Q4 revenue growth was driven by 8% growth in B2B on the back of new project wins and a 6% increase in residential fixed as a result of a 10% expansion in the RGU base over the last year. Offsetting this, in part, was a 5% decline in residential mobile, primarily due to a decrease in prepaid RGUs exasperated by countrywide protests during the quarter.

By 8% growth in B to B on the back of New project wins, and 6% increase in residential fixed as a result of a 10% expansion in the <unk> base over the last year.

Offsetting in part with a 5% decline in residential mobile primarily due to a decrease in prepaid our ges exasperated by country wide protests during the quarter.

Christopher Noyes: As has been the case all year, our adjusted OEBDA performance was helped by value capture from the 2022 CLARO acquisition, which should further act as a tailwind into 2024. Turning to Liberty Networks, we reported $114 million in revenue and $62 million in adjusted OEBDA, reflecting rebate declines of 9% and 22%, respectively. The comparison to Q4 2022 was difficult as the prior year quarter benefited from higher revenue from a customer that is recognized on a cash basis, IRU accelerations, and higher amounts of deferred revenue amortization. The combined quarter-of-a-quarter impact of these factors was approximately $16 million. With that being said, Liberty Network's revenue was broadly similar to Q3, and Adjusted OEBDA was only lower by $3 million. Consequently, our Adjusted OEBDA margin remained very high at 54%. Second from the right is Liberty of Puerto Rico.

As had been the case all year, our adjusted OIBDA performance was helped by value capture from the 2022 Claro acquisition, which should further act as a tailwind into 2024.

Turning to Liberty networks, we reported $114 million in revenue and $62 million and adjusted OIBDA, reflecting rebased declines of 9% and 22% respectively.

The comparison to Q4 2022 was difficult as the prior year quarter benefited from higher revenue from a customer that is recognized on a cash basis, <unk> acceleration and higher amounts of deferred revenue amortization.

The combined quarter over quarter impact of these factors was approximately $16 million with that being said Liberty network's revenue was broadly similar to Q3 and adjusted OIBDA was only lower by $3 million. Consequently, our adjusted OIBDA margin remained very high at 54% second from the right Liberty, Puerto Rico our.

Christopher Noyes: Our revenue in Q4 was $354 million, and adjusted OEBDA was $104 million, representing rebase declines of 5% and 12%, respectively. As compared to Q4 last year, residential fixed revenues were up 5%, driven by a combination of volume and pricing, which was more than offset by a 11% decline in residential mobile revenue, primarily due to a decline in equipment sales and, to a lesser extent, a decline in mobile subscription revenue, mainly pertaining to prepaid subscribers. Our Q4 adjusted OEBDA of $104 million compares to $118 million in Q4 2022 and $116 million in Q3 2023. A key factor in our lower adjusted OEBDA as compared to both periods is a result of significantly higher operating costs attributable to our migration and integration activities.

Revenue in Q4 was $354 million and adjusted OIBDA was $104 million.

Representing rebased declines of 5% and 12% respectively as compared to Q4 last year residential fixed revenues was up 5% driven by a combination of volume and pricing, which was more than offset by a 11% decline in residential mobile revenue, primarily due to a decline in equipment sales and to a lesser extent a decline in mobile subscription.

<unk>, mainly pertaining to prepaid subscribers.

Our Q4, adjusted OIBDA of $104 million compares to $118 million in Q4, 2022 and $116 million in Q3 2023.

A key factor in our lower adjusted OIBDA as compared to both periods as a result of significantly higher operating cost attributable to our migration and integration activities, we incurred $7 million of incremental integration Opex in Q4, 23 as compared to the prior year quarter driven by the ramp up in migration activities. In addition, we are experiencing.

Christopher Noyes: We incurred $7 million of incremental integration OPEX in Q4-23 as compared to the prior year quarter driven by the ramp-up in migration activities. In addition, we are experiencing higher expenses in general during this period when we are running parallel operations across our new platform and the AT&T platform. On a full year basis, we incurred roughly $45 million of integration costs, with $20 million attributable to operating costs and $25 million relating to CapEx. In addition, we incurred approximately $90 million of costs to AT&T through the TSA arrangement.

Higher expenses in general during this period, where we are running parallel operations across our new platform and the AT&T platform on a full year basis, we incurred roughly $45 million of integration costs with $20 million attributable to operating costs and $25 million relating to Capex. In addition, we incurred approximately 90.

A cost to AT&T through the TSA arrangement with respect to the upcoming quarters. Our expectation is that Q1 will be the toughest quarter to date from a reporting perspective, given elevated integration migration activities and the continued duplication of certain costs, we expect to build from Q1 as migration related and duplicate.

Christopher Noyes: With respect to the upcoming quarters, our expectation is that Q1 will be the toughest quarter to date from a reporting perspective, given elevated integration migration activities and the continued duplication of certain costs. We expect to build from Q1 as migration-related and duplicative costs run off, we begin to execute on our revenue growth plan, and we drive our cost takeout strategy. This should enable us to deliver what Balan had noted, which is reaching a monthly adjusted OEBDA of $45-plus million at a point during H2. As such, we expect the leverage to be high-sided through Q1 and Q2, and begin the path to a more normal state in the second half of the year and furthermore into 2024. Concluding with Costa Rica on the far right, we generated Q4 revenue of $149 million and $58 million of adjusted OEBDA, reflecting strong rebase revenue growth of 10% and an LLA segment leading 36% rebase adjusted OEBDA growth.

The cost run off we begin to execute on our revenue growth plan and we drive our cost takeout strategy. This should enable us to deliver with Alan had noted which is reaching a monthly adjusted OIBDA of $45 million at one point during <unk> as such we expect the leverage to be high sided through Q1, and Q2 and begin the path too.

For a more normal state in the second half of the year and Furthermore into 2025 <unk>.

Concluding with Costa Rica on the far right, we generated Q4 revenue of $149 million and $58 million of adjusted OIBDA, reflecting strong rebased revenue growth of 10% and an MLA segment, leading 36% Rebased adjusted OIBDA growth year over year revenue performance was driven by <unk> and <unk>.

<unk> mobile revenue helped in large part by over 85000 postpaid additions during the year similar to previous quarters, adjusted OIBDA expanded significantly year over year benefiting from the continued strengthening of the Costa Rican colon to U S. Dollar as we have certain cost denominated in U S dollars as a result of the strong quarter.

Christopher Noyes: Year-over-year revenue performance was driven by B2B and residential mobile revenue, helped in large part by over 85,000 postpaid additions during the year. Similar to previous quarters, adjusted OEBDA expanded significantly year-over-year, benefiting from the continued strengthening of the Costa Rican código to the U.S. dollar as we have certain costs denominated in U.S. dollars. As a result of the strong quarter, our adjusted OEBDA margin hit 39%, our best result in over two years.

Our adjusted OIBDA margin hit 39%, our best result in over two years.

Turning to slide 14, I will discuss 2023, <unk> additions and adjusted FCS first we incurred $207 million of <unk> additions in Q4 and $731 million for the full year with the latter representing 16% of revenue in line with our 2023 guidance target of note is valid.

Mentioned, we built or upgraded about 350000 homes during the year and second we delivered adjusted free cash flow of $184 million for Q4 and $198 million for 2023 after distributions to our partners of $34 million for Q4 and $75 million for 2020.

Christopher Noyes: Turning to slide 14, I will discuss 2023 P&E additions and adjusted FCF. First, we incurred $207 million of P&E additions in Q4 and $731 million for the full year, with the latter representing 16% of revenue, in line with our 2023 guidance target. Of note, as Balan mentioned, we built or upgraded about 350,000 homes during the year. Second, we delivered adjusted free cash flow of $184 million for Q4 and $198 million for 2023 after distributions to our partners of $34 million for Q4 and $75 million for 2023. For the full year, we had targeted $300 million of adjusted free cash flow before partner distributions and finished the year with $273 million, a good result year over year.

For the full year, we had targeted $300 million of adjusted free cash flow before partner distributions and finished the year with $273 million. A good result year over year. However, the risks that we had identified at Q3 did come to fruition, including a shortfall in BD GE collect.

<unk> in Panama.

Moving to slide 15, we finished 2023 with total debt of $8 $2 billion of cash of $1 billion in access to over $850 million in revolving facilities, our gross and net debt ratio of two <unk> adjusted OIBDA of four eight times and four two times, respectively and over 90.

5% of our debt is due in 2027 and beyond as a result of the tower transaction at year end and which we completed five of the six countries with Bahamas to complete the next few months, we recorded cash and debt of $244 million. The transaction is accounted for as a financing transaction in terms of our equity and equity linked.

Christopher Noyes: However, the risks that we had identified at Q3 did come to fruition, including a shortfall in B2G collections in Panama. Moving to slide 15, we finished 2023 with total debt of $8.2 billion, cash of $1 billion, and access to over $850 million in revolving facilities. Our gross and net debt ratios to L2QA adjusted OEBDA were 4.8 times and 4.2 times, respectively.

Repurchase activity, we bought $300 million in 2023, including the $118 million of our shares and $182 million of our convertible bonds. We finished 2023 with a fraction less than $140 million of our equity authorization remaining through year end 2025 on.

Christopher Noyes: And over 95% of our debt is due in 2027 and beyond. As a result of the tower transaction at year end, in which we completed five of the six countries, with Bahamas to complete in the next few months, we recorded cash in debt of $244 million. The transaction is accounted for as a financing transaction.

On the right hand part of the slide we thought it'd be helpful to provide a longer term set of financial targets that we are aiming to achieve over the next three years through 2026, we are targeting to grow adjusted EBITDA at a mid to high single digit Rebased CAGR. Similarly like in 2023, we are targeting 16% of revenue for Peony addition to annually.

Christopher Noyes: In terms of our equity and equity link repurchase activity, we bought $300 million in 2023, including $118 million of our shares and $182 million of our convertible bonds. We finished 2023 with a fraction less than $140 million of our equity authorization remaining through year-end 2025. On the right-hand side of the slide, we thought it would be helpful to provide a longer-term set of financial targets that we are aiming to achieve. Over the next three years through 2026, we are targeting to grow adjusted OEBDA at a mid- to high-single-digit rebase CAGR. Similarly, like in 2023, we are targeting 16% of revenue for P&E additions annually, which should be able to support our growth and maintenance requirements. Finally, we are targeting to deliver over $1 billion of aggregate-adjusted free cash flow before distributions over the next three years. Important to note, as a result of the Tower transaction, we will incur, among other things, transaction-related taxes, and currently intend to apply a substantial amount of the Panamanian net proceeds to repay high-cost vendor financing debt versus a 4.25% term loan. These factors would reduce our expected reported free cash flow by over $100 million in the year.

Which should be able to support our growth and maintenance requirements.

Finally, we are targeting to deliver over $1 billion of aggregate adjusted free cash flow before distributions over the next three years.

Important to note as a result of the tower transaction, we will incur among other items transaction related taxes and currently intend to apply a substantial amount of the Panamanian net proceeds to repay high cost vendor financing debt versus 4.25% term loans.

These factors would reduce our expected reported free cash flow by over $100 million in the year.

In summary, we remain focused on our customers and have been investing across our operations to improve their journey from sale to install to experience. We are beginning to see the fruits from these investments as Bob touched upon earlier. Additionally, we remain focused on volume growth and improving our pricing effectiveness through utilization of.

AI tools and capabilities, which should underpin our top line expansion in 2024 importantly, we are near the finish line in Puerto Rico and are looking forward to inflect the business in <unk> and driving improved financial performance on the back of cross sell activities more compelling CVP and cost rationalization, including the elimination of the AT&T.

TSA expenditures as balance at Puerto Rico is a tale of two halves, we will get through the migration and the team is poised to launch strong commercial plans in the second half Inorganically. We had two key announcements in 2023, our tower monetization, which unlocks capital and enhances flexibility across the group and the dish transaction, which upon expected close in 2024.

Christopher Noyes: In summary, we remain focused on our customers and have been investing across our operations to improve their journey from sale to installation to experience. We are beginning to see the fruits of these investments, as Balan touched upon earlier. Additionally, we remain focused on volume growth and improving our pricing effectiveness through the utilization of AI tools and capabilities, which should underpin our top line expansion in 2024. Importantly, we are near the finish line in Puerto Rico and are looking forward to infusing the business in H2 and driving improved financial performance on the back of cross-sell activities, more compelling CVPs, and cost rationalization, including the elimination of the AT&T TSA expenditures. As Balan said, Puerto Rico is a tale of two halves.

Should further strengthen our Puerto Rico business and help us further accelerate our mobile growth in terms of capital deployment, we continue to shrink our equity in 2023 and reduced the outstanding principal on our <unk> convertible bond, we expect to see more of that in 2024, including the repayment of the remaining outstanding balance of the convertible bond this summer.

Wrapping up we delivered 2023 growth in terms of adjusted OIBDA and adjusted FCS before our partner distributions, which is a solid result, when viewed across the industry and the overall business climate across the region. Today. We have also shared our three year targets, which we are working hard to execute and which highlight the potential to create significant value over the <unk>.

Coming years.

With that operator happy to open the line to take questions.

A question answer session will be conducted electronically if you would like to ask a question regarding the company's operations. Please do so by pressing star one to ask a question. Please press star two if you'd like to remove your question.

Christopher Noyes: We will get through the migration, and the team is poised to launch strong commercial plans in the second half. Inorganically, we had two key announcements in 2023: our tower monetization, which unlocks capital and enhances flexibility across the group, and the dish transaction, which, upon its expected close in 2024, should further strengthen our Puerto Rico business and help us further accelerate our mobile growth. In terms of capital deployment, we will continue to shrink our equity in 2023 and reduce the outstanding principal on our LLA convertible bond.

Press Star Zero for operator assistance.

In order to accommodate everyone. We request that you ask only one question with one follow up if needed.

If youre using a speakerphone. Please make sure your mute function is turned off to allow your signal to reach our equipment.

We'll pause for just a moment to give everyone an opportunity to signal for questions.

Our first question today is from the line of Sumit Datta with New Street Research. Your line is now open.

Okay.

Yeah, Hi, guys. Thanks, very much for taking the question.

Operator: We expect to see more of that in 2024, including the repayment of the remaining outstanding balance of the convertible bond this summer. Wrapping up, we delivered growth in terms of Adjusted OEBDA and Adjusted FCF before partner distributions, which is a solid result when viewed across the industry and the overall business climate across the region. Today, we also shared our three-year targets, which we're working hard to achieve and which highlight the potential to create significant value over the coming years, with that operator happy to open the line to take questions. If you would like to ask a question regarding the company's operations, please do so by pressing star 1 to ask a question. Please press star 2 if you would like to remove your question, or press star zero for operator assistance. In order to accommodate everyone, we request that you ask only one question with one follow-up, if needed. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment.

A couple from me.

Just Chris just going back to your to your presentation. There were a few numbers and then I'm not sure. If there was in the slide deck.

Particularly recalibrating, Puerto Rico do you mind, just again kind of maybe talking through the cadence.

For 2024, you mentioned Q1.

It's going to be it's going to be the tougher quarter and then you come out to that maybe if you could just either just recap on some of those numbers or just again talk about.

Some of the parameters around integration costs.

EBIT fell to the degree you can.

Maybe just.

Just walk through the year, we came in a bit more detail would be will be a great starting point. Please.

Sure.

Nice to hear from you.

I think a couple of things to point out with the migration where we're at.

At the tail end. So there is a significant amount of sort of cost right at the end as we move customers on both B to C and b to B. So as we look at the quarter and compare back to Q4, you do have customers that have incompatible handsets and things like that so we will incur.

Operator: We'll pause for just a moment to give everyone an opportunity to signal for questions. Our first question today is from the line of Soomit Datta of New Street Research. Soomit, your line is now open.

Additional cogs running through the numbers in the quarter as well as I would say at somewhat heavy.

Soomit Datta: Yeah, hi, guys. Thanks very much for taking the question. A couple from me.

Integration costs, some of which you saw in Q4, but it will be pretty heavy as we go February March April and then start tailing off so as I look at the <unk> or the adjusted OIBDA number.

Christopher Noyes: Chris, just going back to your presentation, there were a few numbers in there. I'm not sure if they're all in the slide deck, particularly regarding Puerto Rico. Do you mind, again, kind of maybe talking through the cadence?

Soomit Datta: 2024, you mentioned Q1 is going to be the top of the quarter, and then you come out of that. Maybe if you could just either recap on some of those numbers or just again talk about some of the parameters around integration costs, EBITDA, to the degree you can, maybe just walk through the year again in a bit more detail would be a great starting point. Sure, Soomit, nice to hear from you.

And we look back over history, it should be the most compressed to date.

And then as we as we start tailing out in Q2, the TSA will wind off so it starts ratcheting down so that by the end of June it will be off the overall TSA expense last year, and 23 was $90 million I would expect it.

Christopher Noyes: You know, I think a couple things to point out. With the migration, you know, we're at the tell end, so there's a significant amount of sort of cost right at the end as we move customers on both B2C and B2B. So as we look at the quarter and compare back to Q4, you do have customers that have incompatible handsets and things like that. So we will incur, you know, additional cogs running through the numbers in the quarter, as well as, I would say, a somewhat heavy set of integration costs, some of which you saw in Q4, but it'll be pretty heavy, you know, as we go through February, March, April, and then start tailing off So as I look at the OCF or the adjusted OEBDOT number, and we look back over history, it should be the most compressed to date. And then as we start tailing out in Q2, the TSA will wind off, so it starts ratcheting down so that by the end of June, it will be off. The overall TSA expense last year in $23 million.

75% or so in 2024, which is all through <unk>.

Route to June so that's when you start seeing that pick up as that bleeds off as you get into Q3 Q4.

That's great. Thanks, hopefully that.

I'll give you some quick question.

Sure.

Super helpful. Thank you go.

Go ahead, just maybe as a follow up then.

If you could maybe just again similar question maybe.

Talk through the cadence of the free cash flow guide.

In any more detail you can I guess.

One can assume the.

The free cash flow for 2004 will be the lower end.

That will build.

But are there any other kind of puts and takes we should be thinking about.

Specifically also just on the refinancing maybe you could just talk through that again.

What are you assuming in terms of refinancing.

When might that happen how are you looking at the rates et cetera, et cetera that would be great. Thanks.

Christopher Noyes: I would expect it down, you know, 75% or so, in 2024, which is all through to June. So that's when you start seeing the pickup as that bleeds off as you get into Q3, Q4. That's great, thanks. Yeah, yeah, no, super helpful.

Yes.

Yes, a couple of things I think we feel pretty pre tower transaction, we feel really good about our free cash flow trajectory in 2024.

Soomit Datta: Thank you. Go ahead. Maybe as a follow-up, then, if you could maybe, again, a similar kind of question, maybe, talk through the cadence of the free cash flow guide in any more detail you can. I guess one can assume that the free cash flow for 24 will be the lower end, and that will build. But are there any other kind of puts and takes we should be thinking about? And specifically, also on the refinancing; maybe you could just talk through that again? What are you assuming in terms of refinancing? When might that happen? How are you looking at the rates, etc., etc.? That would be great.

The net impact, which I did flag, we do have transaction related taxes that will run through the numbers circa $45 million. So that wasn't obviously in 'twenty three and as we look at the vendor financing and debt stack in our jointly owned business in.

Panama, we do receive about $90 million.

Net proceeds in that business and so we're thinking of repaying very high kind of vendor financing debt, which is <unk>.

Christopher Noyes: Thanks. Yeah, a couple of things. I think we feel, pre-Tower transaction, we feel really good about our free cash flow trajectory in 2024. The net impact, which I did flag, you know, we do have transaction-related taxes that will run through the numbers, circa $45 million, so that wasn't obviously in 2023. And as we look at the vendor financing and debt stack in our jointly-owned business in Panama, you know, we do receive about $90 million of net proceeds in that business, and so we're thinking of paying a very high amount of vendor financing debt, which is 2X, you know, our current long-term debt in that business, which is at four and a quarter percent. So economically, it would make sense to, you know, repay some of that, So from a phasing perspective, 24 would be the low versus 25, 26.

Our current long term debt in that business, which is at 4.25%. So economically it would make sense to repay some of that which is a negative on the reported free cash flow. So from a phasing perspective 24 would be the low versus 'twenty five 'twenty six we should build as the synergies and value capture.

In Puerto Rico, as well as the other things we're doing across the group delivering on the adjusted OIBDA growth.

In terms of financing assumptions, we did factor in we have 27 to 29 maturities of debt. We did assume we would be refinancing flash terming out some of our debt during the 25 and call. It 24 to 26 time period, obviously rates are higher.

Today than they were several years back so we've factored in much higher.

Got.

Hopefully, we're being conservative and we have some upside on that in terms of as we look at our numbers, we're pretty prudent as we think about sort of our cash flow trajectory. So I am hopeful that.

Christopher Noyes: We should build on the synergies and value capture in Puerto Rico, as well as the other things we're doing across the group, delivering on the adjusted OYPDOC growth. In terms of financing assumptions, you know, we did factor in that we have 27 to 29 maturities of debt. We did assume we would be refinancing and slashing terms out some of our debt during the 25—we call it 24 to 26 time period. Obviously, rates are higher today than they were, you know, several years back.

No surprise overtime.

Sure Okay. Thanks very much.

Okay.

Our next question today is from the line of Vitor Tomita of Goldman.

Goldman Sachs. Your line is now open.

Thank you very much for taking my questions. Good morning al. So the question from our side would be on Puerto Rico could you give me some more color on how the competitive situation is developing in Puerto Rico.

Operator: So we've factored in, you know, much higher costs. You know, hopefully, we're being conservative and we have some upside on that in terms of as we look at our numbers. We're pretty prudent as we think about sort of our cash flow trajectory. So I'm hopeful that, you know, we'll surprise over time. Sure, okay, thanks very much. Our next question today is from the line of Vito Tomito of Goldman Sachs. Vito, your line is now open.

Aside from the customer migration disruptions that affected Q4. Thank you.

Thank you and good morning as well.

Puerto Rico, it's been kind of an interesting market since.

Early last year.

Primary competitor on the mall.

Outside T mobile became extremely aggressive on subsidies.

And we've kind of zig zag around matching them.

And Youll see that as we got into the second half of last year, we started doing a lot more handset subsidies.

Operator: Thank you very much for taking our questions; good morning all. So the question from our side would be on Puerto Rico. Could you give me some more color on how the competitive situation is developing in Puerto Rico, aside from the customer migration disruptions that affected Q4? Thank you. Thank you, and good morning as well.

And in that case, I think we will.

We started to see some positive traction back again on the gross add side.

But as we got into this year I think our biggest.

Balan Nair: You know, Puerto Rico has been kind of an interesting market since early last year when our primary competitor there on the mobile side, T-Mobile, became extremely aggressive, and we've kind of zigged and zagged around matching them. And you'll see that as we got into the second half of last year, we started doing a lot more handset subsidies. And in that case, I think, you know, we started to see some positive traction back again on the growth side.

Our focus right now is in the migration and doing the migration.

A lot of our stores.

Our retail channel our stores and our call center channels as well all of them.

Kind of like just refocus them on helping our customers with the migration.

So the plan is as we come out of the migration riches, we anticipate around.

So it's the latter half of April and then starting in May you're going to see us getting very aggressive back into the market under gross that site.

Balan Nair: As we get into this year, I think our biggest focus right now is the migration. And during the migration, a lot of our stores, both, you know, our retail channels, our stores, and our call center channels as well, all of them, we've kind of just refocused them on helping our customers with the migration. And so the plan is as we come out of the migration, which we anticipate around, you know, towards the latter half of April and then starting in May, you're going to see us getting very aggressive back into the market on the gross debt side. And the one thing we have that Timo doesn't have, of course, it's a great company and all, is that on the island, it's real local, and we have full FFC, which we didn't have, by the way, during the times when we were relying on the AT&T systems.

But one thing we have that T. Mo doesn't have a cross sell I mean, it's a great company and all that.

On the island, we are local.

And we have full <unk>.

<unk>, which we didn't have by the way during the <unk>.

We're relying on the AT&T systems. So once we migrate everything over I think we have a pretty good product proposition.

That's very clear thank you very much.

As a reminder, if you would like to ask a question. Please press star followed by one on your telephone keypad now.

And our next question today is from the line of Matthew Harrigan with benchmark company.

Please go ahead your line is open.

Thank you.

You have some dispersion in the economic performance across.

Balan Nair: But once we migrate everything over, I think we'll have a pretty good product proposition. Very clear, thank you very much. As a reminder, if you would like to ask a question, please press star followed by 1 on your telephone keypad now. And our next question today is from the line of Matthew Harrigan of Benchmark Company. Please go ahead.

Market cable and wireless will have maybe call and these are pretty good given the level of tourism right now.

Programs or even apart from the competitive issues in Puerto Rico, and the long term macro outlook.

You talked about having broadband pricing increases.

Or in the vicinity of <unk>.

Place there with the.

Matthew Harrigan: Clearly, you have some dispersion in the economic performance across your markets, you know, cable and wireless. But I have to believe, you know, the economies are pretty good given the level of tourism. Right now, you know, I know people will be concerned, even apart from the competitive issues in Puerto Rico and the long-term macro outlook. But you talked about having broadband pricing increases at or in the vicinity of inflation. I mean, there were some markets, I know the UK, you know, all the markets over there have had very material price increases. In some instances, you had, you know, realized RFP would actually pull down as people downgrade some of their tiers.

The market that there will be U K and all the endpoints over there.

Very material price increases and some increases you've had realized RFP will actually pull down.

People downgrade from there.

Ours.

Is there anything that gives you concern on pricing or are you quite confident you can pull off those price increases and is there anything you really across your broad territory that makes you concerned about the enterprise business. If you do get some.

The economic softness and again, thanks for letting me ask a question.

Thank you Matthew and I think when it comes to price increases we're going to be very opportunistic yet also realistic and theres a couple of three different factors that drive that across different markets.

Balan Nair: Is there anything that gives you concern about pricing? Are you quite confident you can pull off those price increases? And is there anything you really across your broad territory that makes you concerned about the enterprise business if you do get some economic softness? And again, thanks for letting me ask the question. Thank you, Matthew.

It's going to be a very different outcome.

So you look at one <unk>.

<unk> propensity to be able to absorb price increases secondly, look at where your competitor is that and what they expected response or what did they do for us.

Certainly you've got to look at this on product line, we have prepaid postpaid we have fixed broadband video clearly some products you tend to take price increases on some products you just it's just not that.

Balan Nair: And I think, you know, when it comes to price increases, we're going to be very opportunistic, yet also realistic. And, you know, there are a couple, three different factors that drive that. Of course, different markets, it's, it's going to be a very different outcome. So you look at one, the consumer's propensity to be able to absorb price increases.

Smart to do it.

And then lastly, we also look at inflation in each one of these markets.

And so you try to moderate yourselves as Chris alluded to in his.

Comments earlier, we are looking at using a number of different tools to help us with those.

Balan Nair: Let me look at where your competitor is at and what the expected response is or what they did first. Thirdly, you've got to look at this on the product line. We have prepaid, postpaid, we have fixed broadband, and video; clearly, some products you can take price increases on, and some products you just, it's just not that, you know, that smart to do it. And then lastly, we also look at inflation in each one of these markets. And so you should try to moderate yourself.

To not only maximize that price increase opportunities, but also to maximize it with minimal amount of just a minimal amount of calls coming into our retention desk and so we are going to be very very situational on our price increases.

Clearly.

I think this industry.

All of.

Everybody in the telecom space, I think kind of like minded debt for the longest time.

We've held back on price increases and.

I think some of the cost of really absorbed in our businesses I think our consumers also understand to some degree that some of that costs will come back because it comes back to them and other things, whether it's food energy et cetera, but telecoms. It remained relatively flat. So so I think youll see some price increases across.

Balan Nair: As Chris alluded to in his comments earlier, we are looking at using a number of different tools to help us with this, to not only maximize our price increase opportunities but also to maximize it with a minimal amount of churn and minimal amount of calls coming into our retention desk. And so we're going to be very, very situational on our price increases. But clearly, I think this industry... all of our, you know, everybody in the telecom space, I think, kind of like-minded that for the longest time, we've held back on price increases. And in time, I think some of the cost that we've really absorbed in our businesses; I think our consumers also understand to some degree that, you know, some of that cost will come back because it comes back to them and other things, whether it's food, energy, et cetera, but telecoms have remained relatively flat.

The board.

And Thats, what Im hearing also from some of the other folks whether it's in North America, and Europe and Asia, everybody is looking at it that way.

And there's nothing that concerns you right now on the enterprise business in terms of the <unk>.

Economies.

On the enterprise is kind of interesting.

Because we have it as enterprise the large enterprises.

Our government.

And clearly the this meeting medium minute rides in Soho and each one of them will have different reactions to this I can tell you for sure on the government side all governments in our region are under a lot of pressure.

Balan Nair: So I think you'll see some price increases across the board. And that's what I'm hearing also from some of the other folks; whether it's in North America or in Europe or in Asia, everybody's looking at that. And there's nothing that concerns you right now in the enterprise business in terms of it interlaced with the economy. On the enterprise, it's kind of interesting, because it's enterprise to the large enterprises, to our government, and clearly SME, medium enterprises, and so on. And each one of them will have a different reaction to this.

Don't think I don't think youre going to see much price increases in that segment and that segment. We are focused on more volume we focus on more new products, but we're not going back and taking a look at.

Increasing the prices.

Yes.

On the back book on.

On margin to prices I think there's a couple of this opportunity for us for sure.

Especially in some of the new services that we intend on coming out with and so I see opportunities certainly in the Soho space opportunities as well and once again, its situational and by country.

Balan Nair: I can tell you for sure on the government side: all governments in our region are under a lot of pressure. I don't think you're going to see many price increases in that segment. In that segment, we'll focus on more volume. We'll focus on more new products. But we're not going back and taking a look at, you know, increasing their prices on the back.

Some countries I think there is more opportunities than others.

Great.

Thank you.

Our next question today is from the line of Gabriel Lima of Morgan Stanley.

Your line is now open.

Balan Nair: On large enterprises, I think there's opportunity for us, for sure, especially in some of the new services that we intend on coming out with. And so I see opportunities there. Certainly, in the Soho space, there's opportunities as well. But, once again, it's situational and by country.

Thank you very much for taking my question just.

Just wanted to get your thoughts in terms of what are the trends you're seeing for first quarter anything you can share with us will be super helpful.

Okay Hi.

Hey, Bill.

Balan Nair: So some countries, I think there are more opportunities than others. Great. Makes sense. Our next question today is from the line of Gabriel Vaz de Lima of Morgan Stanley. Gabriel, your line is...

I've got to be capital, how I say this because there is no further guidance beyond the guidance that we've provided.

I can tell you that January sales are coming in well.

But that's also.

Gabriel Vaz de Lima: Thank you very much for taking my question. I just wanted to get your thoughts in terms of what the trends you're seeing for the first quarter are. Anything you can share with us will be super helpful.

We are cautiously optimistic because we wanted to.

We want to get through the migration.

We wanted to get through the migration of our customers in Puerto Rico.

Balan Nair: Okay. Hi Gabriel. I've got to be careful how I say this because there's no further guidance beyond the guidance that we've provided. I can see that January, you know, sales are coming in well. But that's also, you know, we're cautiously optimistic because we want to get through the migration of our customers in Puerto Rico and get that behind us. And then we'll, you know, then we'll look at the second half more clearly. But January sales are coming in, you know, right around to slightly better than last year. But that's Shannon. One month does not make a trend. You got it crystal clear. Thank you very much.

And that.

That's behind US and then well then we'll look at the second half more clearly.

January sales were coming in.

Right around to slightly better than budget.

That center.

One one month does not make a trend.

Got it crystal clear thank you very much.

Our next question today is from the line of Michael Rollins of Citigroup. Michael Your line is now open. Please go ahead.

Good morning, two questions if I could first I was just curious.

If you can unpack a bit more of what's happening in the Liberty networks in terms of financial performance in the fourth quarter and how that might progress on a go forward basis.

Michael Rollins: Our next question today is from the line of Michael Rollins of Citigroup. Good morning, questions. If I could first, I was just curious. Let's unpack a bit more of what's happening. This concludes our webinar. And then secondly, and just taking a step back, where is Liberty Latin America on the journey of optimizing the app, that, and you know, is there... I don't know.

And then secondly, just taking a step back.

There is Liberty Latin America on the journey.

Optimizing the assets that you hold and operate.

And is there anything of significance.

Left to do or important to do that investors should be mindful of.

Balan Nair: Court, that investors should be mindful of. Thanks. I'll ask Ray to jump in here as well.

<unk>.

Okay.

I'll ask Ralph to jump in here as well I think.

Balan Nair: I think, you know, as Chris pointed out, The Liberty Network's revenue stream is kind of, you know, very interesting. We do have a number of non-cash revenues that come in that's kind of, you know, it's very lumpy. And so whether it's our, you know, IRU acceleration or one-off IRU sales. And so when we came into December of last year, the fourth quarter, there were a number of contracts that we were looking at with some really, you know, some of the hyperscalers as an example that, for one reason or another, were phased out into the second quarter.

As Chris pointed out.

Yes, the Liberty network's revenue stream, it's kind of very interesting. We do have a number of noncash revenues that come in that's kind of.

It's very lumpy.

So whether it's our <unk>.

<unk> acceleration.

One off.

<unk> sales and so when we came into December of last year fourth quarter. The number of contracts that we were looking at it.

Some really some of the Hyperscale is this an example of that.

For one reason and another was phased out and do in the second quarter, they were not as much cash impacting.

Balan Nair: They were not as cash impacting, but it was certainly revenue that we would have booked in the fourth quarter. So from a revenue line perspective, you know, you'll see some lumpiness in a lot of these one-off, what we call NRR, non-recurring revenue type opportunities. Now, one of the things that Ray and I and a number of folks have been focused on in this business is moving a lot more to MRR-type revenue streams, and you can see that in the bottom line as well. So that's, therefore, when you look at the year over year growth, it is somewhat impacted. But when you look at the cash flow growth, it's less impacted.

Sydney Robb.

The revenue that we would have booked in the fourth quarter, so from a revenue and lines perspective.

Youll see some lumpiness in a lot of these one off what we call nonrecurring revenue opportunities.

Opportunities no one thinks that ray and I and the number of folks have been focused on this business is moving a lot more to the MRI type revenue streams.

And you can see that in the bottom line as well. So therefore, when you look at the year over year growth. It is somewhat impacted but when you look at the cash flow growth is less impacted.

Balan Nair: But you'll see in 24, one of the things Ray's working on, two things I'm really excited about is one, the way we're migrating a lot of our revenues into longer-term and really cash-generating revenues, which we have a ton of, but now we're going to focus double down even more on those. And secondly, you saw from my comments earlier today and the press releases that we put out last year on new routes that we're building. We are now, you know. We really see a lot of opportunity in this segment where we're going to invest in more routes. Demand for traffic is higher than ever.

But you will see in 'twenty form one of the things rates working on two things I'm really excited about is one of the way.

We're migrating a lot of our revenues and do longer term and really cash generating revenues.

We have done up but now we're going to double down even more on dose and secondly, you saw from my comments earlier today in press releases that we've put out last year on new routes that rebuilding we are now.

See a lot of opportunity in this.

Segment, where we can invest in more routes demand for traffic is higher than ever.

Balan Nair: We're going to build new drops into locations where we think the hyperscalers are going to build even more data centers, and they are going to bring a lot more traffic back to the U.S. I'm actually very, very bullish and excited about this business unit. Ray, maybe you want to add on to that.

Building new drops into locations, where we think the hyperscale is it going to be even more data centers going to bring a lot more traffic back to the U S.

Italy, very very bullish and excited about this business unit Ray maybe you want to add on to that.

Ray: Yeah, the only thing I would say, and I think you hit it, Balan, but just the slides that you shared in the presentation where you see the 8% growth in the MRO, which taken together with our intercompany revenue, makes up the majority of the overall revenue in the segment. So, you're seeing underlying top-line growth at 8%. But you do get volatility from quarter to quarter and year over year in terms of quarters.

Okay.

Yes.

I think you hit it down but just to the slides that you shared.

The presentation, where you see the 8% growth from the MMR, which taken together with our intercompany revenue makes up the majority.

Of the overall revenue in the segment, so youre seeing underlying top line growth at 8%.

But you do get you do get volatility from quarter to quarter and year over year.

Quarter.

Ray: But in many cases, that is, as Balan said, non-cash impacting. So, I concur that we're very bullish on this. Bureaucracy.

In many cases that is non.

Non cash impacting.

Where I do concur that where we're very bullish on the future.

Christopher Noyes: Yeah, and I would add just one thing on the... Sorry, I was just going to add one more point on the network's revenue. You know, we did have a very large cash collection in Q4 2022, and it's a customer that we recognize revenue on a cash basis. And then in 2023, we collected throughout the year. So that's sort of the biggest delta on a year-over-year basis for the business, although it was skewed from the Q4 22.

Yeah, and I would add just one thing on the.

Sorry, I was just going to add one more point.

On the networks revenue, we did have a very large.

Cash collection in Q4, 2022, and it's a customer that we recognize revenue on a cash basis.

And then in 2023, we collected throughout the year. So that that's sort of the biggest delta on a year over year basis for the business. It was skewed from the Q4 'twenty two.

Christopher Noyes: Thanks for the clarification, Chris. Yeah. Thanks. That's our large customer, yeah, in Venezuela. And I think you had a second question, which was about the footprint. Is that correct?

Thanks for the clarification, Chris Thanks.

The large customer.

In Venezuela.

And I think you had a second question, which was on the footprint.

Is that correct.

Michael Rollins: Yeah, exactly where Liberty Latin America is in terms of optimizing. The assets that you hold and operate and are left to do all should be mindful. I think, you know, we'd be.

Yes.

Exactly where.

Liberty Latin America is in terms of optimizing the assets that you hold and operate.

And.

If theres anything that you feel is left to do significant.

All should be mindful of.

I think we.

Balan Nair: Actually quite opportunistic in this space, you know, there are two really business segments in Liberty Networks. That's the wholesale business where we have subsea, you know, landing points in a number of countries. And I just alluded to the fact that we're building even more so coming out of Colombia, into Mexico, and then back to Miami, with drops in Panama, etc. So we will get more landing sites for the subsidy business and more, a bigger mesh, I guess you can say. But in addition to that, we also have another segment within this unit that is focused on enterprise B2B. And we are in Central America; we are in Colombia, and we are in the Dominican Republic.

We actually quite opportunistic in this space.

Yes, there is two really business segments and Liberty networks that the wholesale business, where we have subsea Len.

Lending points in a number of countries and I just alluded to the fact that we're building even more so coming out of Colombia into Mexico, and then back to Miami with drops in Panama et cetera. So.

Get more lending sites for our subsea business in mall.

Bigger mesh I guess, you can say, but in addition to that we also have another segment within this unit that is focused on enterprise B to B and we are in Central America and Colombia.

Dominican Republic.

Balan Nair: And I must tell you, I am actually quite excited about a number of these areas. And one of the things that Ray, Chris, and I are going to be looking at is perhaps different ways of expanding our footprint in some of these markets. They are actually quite positive. The numbers are pretty small right now, but we're gonna really re-look at a lot of our investments here. And I think that's a huge opportunity. I'm particularly excited about El Salvador, Guatemala, Honduras, and these countries. I think there's something there, but you'll see that play out in 2040.

And.

I must tell you I am actually quite excited about number of these areas and one of the things that ray.

Chris and I are going to be looking at is perhaps different ways on expanding our footprint in some of these markets.

Actually quite positive the numbers are pretty small right now, but but we kind of we look at a lot of our investments you're in I think.

Huge opportunity, particularly excited about.

EBITDAR, Guatemala, Honduras in these countries.

I think that's something that there, but you will see that play out in 2004.

Balan Nair: Thank you. That will conclude today's question and answer session. I'd now like to hand it back to Balan Nair for any additional or closing remarks. Thank you, Operator. And to everybody who saw our guidance, we've moved from a one-year guidance to a three-year guidance, and I think that gives you a little bit more visibility into our business in the medium term. And I want to emphasize one of the things that Chris said, especially in the free cash flow, which I think, as you said, is greater than $1 billion. I think we are quite optimistic about the future. And I do want to thank all of you for your support. Have a great day! Ladies and gentlemen, this concludes Liberty Latin America's full-year 2023 Investor Call. As a reminder, a replay of the call will be available in the Investor Relations section of Liberty Latin America's website at www.lla.gov. There you can also find a copy of today's presentation.

Thank you.

That will conclude today's question and answer session I would now like to hand back to <unk> for any additional or closing remarks.

Thank you operator, and everybody you saw guidance, we've moved from a one year guidance of three year guidance anything that gives you a little bit more visibility mid term due to our business.

I want to emphasize one of the things that Chris said.

Especially on the free cash flow.

I think you said greater than $1 billion I think.

Quite optimistic about the future.

And I don't want to thank all of you for your support have a great day.

Okay.

Ladies and gentlemen, this concludes Liberty Latin America's full year 2023, Investor call. As a reminder, a replay of the call will be available in the Investor Relations section of Liberty Latin America's website at Www Dot dot.

Dot com.

You can also find a copy of today's presentation materials.

Okay.

Yeah.