Q3 2024 Liberty Latin America Ltd Earnings Call
Liberty Latin America.
Speaker Change: Good morning, and welcome to Liberty Latin America's third quarter 2024, 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 <unk> Dot com following today's <unk>.
<unk> presentation instructions will be given for a question and answer session. As a reminder, this call is being recorded.
Speaker Change: 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.
Speaker Change: For more information please refer to the risk factors discussed in Liberty Latin America's Most recently filed annual report on Form 10-K, and quarterly report on Form 10-Q, along with the associated press release.
Please stand by. Good day, everyone. You are holding for Liberty, Latin America's third quarter 2024 invest call.
Speaker Change: 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 statements 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.
We'll begin in roughly one minute's time to allow all participants to get connected.
Speaker Change: <unk> financial measures, which can be found in the appendices to this presentation, which is accessible under the investors section of our website.
Speaker Change: I would now like to turn the call over to our CEO Mr. Bolan there.
Mr. Bolan: Thank you Bill and welcome everybody to Liberty Latin America's third quarter results presentation.
Mr. Bolan: I'll begin with our group highlights and an overview of our operating results by reporting segment.
Mr. Bolan: 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'll invite them to contribute as needed during the Q&A following our prepared remarks.
Speaker Change: Good morning, ladies and gentlemen, and thank you for standing by. Today's call is being recorded. I'll now turn the call over to Bill Greer-Lee, Head of Compliance and Ethics, Liberty Latin America.
Mr. Bolan: Point of housekeeping, we will both be working from slides, which you can find on our website at www Dot LLE dot com.
Mr. Bolan: Starting on slide four and our highlights.
Bill Greer-Lee: Good morning, and welcome to Liberty Latin America's third quarter 2024 investor call.
Mr. Bolan: We have added over 50000 high speed broadband and postpaid mobile subscribers year to date.
Mr. Bolan: This figure was a robust 225000 ads, excluding Puerto Rico, where we have begun to recover following a complex migration project.
Speaker Change: Following today's formal presentation, instructions will be given for a question and answer session. As a reminder, this call is being recorded.
Mr. Bolan: Further color on our progress later in the presentation.
Mr. Bolan: We also experienced some negative net adds in cable and wireless Caribbean during the quarter as a result of hurricane barrel.
Speaker Change: 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.
Mr. Bolan: We reported adjusted OIBDA of $1 $2 billion year to date this.
Mr. Bolan: This includes rebased growth in <unk>, Caribbean, <unk>, Panama, and Liberty Costa Rica.
Speaker Change: For more information, please refer to the risk factors discussed in Liberty Latin America's most recently filed annual report on Form 10-K and quarterly report on Form 10-Q, along with the associated press release.
Mr. Bolan: We expect adjusted OIBDA performance to accelerate in Q4, driven by <unk> and anticipated improved results in our Puerto Rican operations.
Mr. Bolan: We successfully refinanced $1 billion of folks cable and wireless credit silo senior notes last month, the issuance was significantly oversubscribed, reflecting the silos strength.
Bill Greer-Lee: 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.
Mr. Bolan: Finally, we continue to explore inorganic ways to drive shareholder value and I'm excited to provide more details regarding an investment that we've been cultivating in Peru.
Bill Greer-Lee: 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 this presentation, which is accessible under the Investors section of our website.
Mr. Bolan: This is a large and growing market, where we have built significant fiber footprint and see potential to create value.
Bill Greer-Lee: I would now like to turn the call over to our CEO, Mr. Balan Nair.
Mr. Bolan: We are also pleased to announce the addition of sparkle to our new Pan regional subsea system.
Balan Nair: Thank you, Bill, and welcome everybody to Liberty Latin America's third quarter results presentation.
Mr. Bolan: Turning to slide five I will begin our operating review with CFW Caribbean.
Bill Greer-Lee: Chris Noyes, our CFO, will then follow with a review of the company's financial performance.
Mr. Bolan: On the left of the slide we present, our internet and mobile postpaid additions.
After that, we will get straight to your questions.
Mr. Bolan: Q3 broadband adds were negatively affected by hurricane barrel, which impacted our operations in Jamaica, Grenada, St Vincent and the Grenadines in early July.
Bill Greer-Lee: As always, I'm joined by my executive team from across the region, and I'll invite them to contribute as needed during the Q&A following our prepared remarks.
Mr. Bolan: Adjusting for this event, we would've added 3000 broadband <unk> used in the quarter.
Mr. Bolan: We anticipate further impacts to net adds in Q4, but are working hard to minimize them.
starting on slide four in our highlights.
Mr. Bolan: Postpaid mobile adds although positive were lower sequentially and year over year barrel impacted sales efforts.
Bill Greer-Lee: We have added over 50,000 high-speed broadband and postpaid mobile subscribers year-to-date. This figure was a robust 225,000 ads, excluding Puerto Rico, where we have begun to recover following our complex migration project.
Mr. Bolan: There was however, an increase in prepaid adds as customers wanted to ensure access to mobile networks in the event of any outages, particularly in Jamaica.
Mr. Bolan: Moving to the center of the slide we generated 2% Rebased revenue growth year to date, driven by our continued consumer momentum, particularly in mobile.
Bill Greer-Lee: I'll share further color on our progress later in the presentation.
Bill Greer-Lee: We also experienced some negative net ads in cable and wireless Caribbean during the quarter as a result of Hurricane Beryl.
Mr. Bolan: Finally, I want to recognize our colleagues in <unk> for delivering adjusted OIBDA growth, both sequentially and year over year in Q3, despite the challenges faced in the quarter.
Bill Greer-Lee: We reported adjusted OEBDA of $1.2 billion year-to-date. This includes rebase growth in CNW Caribbean, CNW Panama, and Liberty Costa Rica.
Mr. Bolan: Moving to slide six and our CFW Panama segment.
Bill Greer-Lee: We expect adjusted OEVIDA performance to accelerate in Q4, driven by B2B, and anticipated improved results in our Puerto Rican operations.
Mr. Bolan: Starting on the left of the slide.
Mr. Bolan: We continue to drive penetration of our fixed footprint and delivered another solid quarter of Internet subscriber adds and robust revenue growth.
Bill Greer-Lee: We successfully refinanced $1 billion of folks cable and wireless credit silo senior notes last month, the issuance was significantly oversubscribed, reflecting the silos strength.
Bill Greer-Lee: We successfully refinanced $1 billion of our cable and wireless credit silo senior notes last month. The issuance was significantly oversubscribed, reflecting the silo's strength.
Mr. Bolan: Our fixed network provides high speed connectivity across more than 95% of our homes passed with the majority of those homes passed via FTE th infrastructure.
Bill Greer-Lee: Finally, we continue to explore inorganic ways to drive shareholder value.
Bill Greer-Lee: Finally, we continue to explore inorganic ways to drive shareholder value and are excited to provide more details regarding an investment that we've been cultivating in Peru.
Mr. Bolan: In mobile we continue to grow our postpaid base. However returned to a more normalized rate of adds following an exceptional second quarter driven by did yourselves exit from the market.
Bill Greer-Lee: Excited to provide more details regarding an investment that we've been cultivating.
Bill Greer-Lee: This is a large and growing market, where we have built significant fiber footprint and see potential to create value.
Mr. Bolan: We mentioned our successful <unk> trials during our last earnings presentation and last month, we became the first operator to launch <unk> in Panama, highlighting our technology leadership in the market.
Bill Greer-Lee: This is a large and growing market where we have built significant fiber footprint and see potential to create value.
Bill Greer-Lee: We're also pleased to announce the addition of sparkle to our new Pan regional subsea system.
Bill Greer-Lee: We are also pleased to announce the addition of SPARCL to our new pan-regional subsea system.
Mr. Bolan: Moving to the incentive the slide we've driven 3% topline growth year to date with positive contributions coming from all our product areas.
Bill Greer-Lee: Turning to slide five I'll be.
Bill Greer-Lee: Turning to slide 5. I'll begin our operating review with CNW Caribbean.
Bill Greer-Lee: Again, our operating review with CFW Caribbean.
Bill Greer-Lee: On the left of the slide we present, our internet and mobile postpaid additions.
Bill Greer-Lee: On the left of the slide, we present our internet and mobile postpaid additions.
Mr. Bolan: Overall, we continued to build momentum in Panama and anticipate continued growth.
Bill Greer-Lee: Q3 broadband adds were negatively affected by hurricane barrel, which impacted our operations in Jamaica, Grenada, St Vincent and the Grenadines in early July.
Bill Greer-Lee: Q3 broadband ads were negatively affected by Hurricane Beryl, which impacted our operations in Jamaica, Grenada, St. Vincent and the Grenadines in early July.
Mr. Bolan: Turning to slide seven and Liberty Costa Rica.
Mr. Bolan: Starting on the left of the slide.
Mr. Bolan: We delivered another quarter of solid broadband subscriber ads against a challenging competitive backdrop in Costa Rica.
Bill Greer-Lee: Adjusting for this event, we would've added 3000 broadband RG use in the quarter.
Bill Greer-Lee: Adjusting for this event we would have added 3,000 broadband RGUs in the quarter.
Bill Greer-Lee: We anticipate further impacts to net adds in Q4, but are working hard to minimize that.
Mr. Bolan: We continue to work towards completing a great combination with millicom, which we anticipate will close by the end of 2025.
Bill Greer-Lee: We anticipate further impacts to net ads in Q4, but are working hard to minimize them.
Bill Greer-Lee: Postpaid mobile adds although positive were lower sequentially and year over year barrel infected sales efforts.
Bill Greer-Lee: Postpaid mobile ads, although positive, were lower sequentially in year-over-year barrel-infected sales efforts.
Mr. Bolan: In mobile we reported another strong quarter removed.
Bill Greer-Lee: There was however, an increase in prepaid adds as customers wanted to ensure access to mobile networks in the event of any outages, particularly in Jamaica.
Mr. Bolan: Remove to book the milestone of 1 million subscribers with net postpaid adds higher both year over year and sequentially.
Bill Greer-Lee: There was, however, an increase in prepaid ads as customers wanted to ensure access to mobile networks in the event of any outages, particularly in Jamaica.
Mr. Bolan: Over the last 12 months, we've now added over 125000 postpaid subs in the market, representing an almost 15% growth in our base.
Bill Greer-Lee: Moving to the center of the slide we generated 2% Rebased revenue growth year to date, driven by our continued consumer momentum, particularly in mobile.
Bill Greer-Lee: Moving to the center of the slide, we generated 2% rebase revenue growth year-to-date, driven by our continued consumer momentum, particularly in mobile.
Mr. Bolan: Moving to the center of the Slide we reported healthy Rebased revenue growth of 5% year to date.
Bill Greer-Lee: Finally, I want to recognize our colleagues <unk> for delivering adjusted OIBDA growth, both sequentially and year over year in Q3, despite the challenges faced in the quarter.
Bill Greer-Lee: Finally, I want to recognize our colleagues in CNW for delivering adjusted OEBD growth, both sequentially and year-over-year in Q3, despite the challenges they faced in the quarter.
Mr. Bolan: Led by mobile.
Mr. Bolan: Next to slide eight and Liberty networks.
Mr. Bolan: On the left of slide we present year to date revenue for the current and prior year periods.
Bill Greer-Lee: Moving to slide six and I'll <unk> Panama segment.
Moving to slide six in our CNW Panama segment.
Mr. Bolan: And the price continues to be our fastest area of growth in this segment and was 8% higher on a rebased basis.
Bill Greer-Lee: Starting on the left of the slide.
starting on the left of the slide.
Bill Greer-Lee: <unk> continued to drive penetration of our fixed footprint and delivered another solid quarter of Internet subscriber adds and robust revenue growth.
Bill Greer-Lee: We continue to drive penetration of our fixed footprint and deliver another solid quarter of internet subscriber ads and robust revenue growth.
Mr. Bolan: As in prior quarters for Liberty networks, and a wholesale business specifically.
Bill Greer-Lee: Fixed network provides high speed connectivity across more than 95% of our homes passed with the majority of those homes passed via F Dth infrastructure.
Mr. Bolan: We highlight the $17 million year over year impact of noncash <unk> declines despite.
Bill Greer-Lee: Our fixed network provides high-speed connectivity across more than 95% of our homes passed, with the majority of those homes passed via FDTH infrastructure.
Mr. Bolan: Fight this headwind from lower <unk> and noncash revenues are underlying wholesale business continued to demonstrate resilience growing modestly.
Bill Greer-Lee: In mobile we continue to grow our postpaid base. However returned to a more normalized rate of adds following an exceptional second quarter driven by did yourselves exit from the market.
Bill Greer-Lee: In mobile, we continue to grow our postpaid base, however, we tend to a more normalized rate of ads following an exceptional second quarter driven by Digicel's exit from the market.
Mr. Bolan: Overall, we are building a business with strong foundation of recurring revenue, which underpins our future prospects.
Bill Greer-Lee: We mentioned the successful <unk> trials during our last earnings presentation and last month, we became the first operator to launch <unk> in Panama, highlighting our technology leadership in the market.
Mr. Bolan: The metrics shown beneath the bars reflect the unique cash conversion characteristics and Liberty. Netflix. This is an infrastructure business with growing cash OIBDA and over 40% OFC of conversion of revenue.
Bill Greer-Lee: Moving to the incentive to slide you have driven 3% topline growth year to date with positive contributions coming from all our product areas.
Mr. Bolan: Given these characteristics Liberty Netflix is a very attractive financial profile and we have spoken previously about the opportunities to invest further in this segment.
Bill Greer-Lee: Moving to the center of the slide, we have driven 3% top-line growth year-to-day with positive contributions coming from all our product areas.
Bill Greer-Lee: Overall, we continued to build momentum in Panama and anticipate continued growth.
Bill Greer-Lee: Overall, we continue to build momentum in Panama and anticipate continued growth.
Mr. Bolan: On the right side of the slide we highlight an investment that will create a new pan regional subsea cable system.
Bill Greer-Lee: Turning to slide seven and Liberty Costa Rica.
Turning to slide seven and Liberty, Costa Rica.
Mr. Bolan: We are excited to share that in addition to gold data, we will partner with Sparkle, a wholly owned subsidiary of Telecom Italia on this project. This will enhance the systems value given sparkles extensive presence in the region.
Bill Greer-Lee: Starting on the left of the slide.
Bill Greer-Lee: Starting on the left of the slide, we delivered another quarter of solid broadband subscriber ads against a challenging competitive backdrop in Costa Rica.
Bill Greer-Lee: We delivered another quarter of solid broadband subscriber ads against challenging competitive backdrop in Costa Rica.
Bill Greer-Lee: We continue to work towards completing our greed combination with millicom, which we anticipate will close by the end of 2025.
Bill Greer-Lee: We continue to work towards completing our agreed combination with Milicom, which we anticipate will close by the end of 2025.
Mr. Bolan: The highlights of the new system will be at site spending over $5 5000 kilometers low latency with six new access points connecting major data hubs new routes the lending in Veracruz, and Appalachia creates vital routes between Mexico, and the United States integrating and enhancing.
Bill Greer-Lee: In mobile we reported another strong quarter.
In Mobile, we reported another strong quadrant.
Bill Greer-Lee: Remove to book the milestone of 1 million subscribers with net postpaid adds higher both year over year and sequentially.
Bill Greer-Lee: Removed above the milestone of 1 million subscribers with net postpaid ads, higher both year-over-year and sequentially.
Bill Greer-Lee: Over the last 12 months, we've now added over 125000 postpaid subs in the market, representing an almost 15% growth in our base.
Bill Greer-Lee: Over the last 12 months, we've now added over 125,000 post-paid subs in the market, representing an almost 15% growth in our base.
Mr. Bolan: Powerful mesh infrastructure and ensuring we have a future proof ready.
Mr. Bolan: We are building a system that will serve to incredible growth in demand from Hyperscale is and the rising traffic requirements related to the ongoing shift to the cloud and AI innovations from the USA to Latin America and the Caribbean.
Bill Greer-Lee: Moving to the center of the Slide we reported healthy Rebased revenue growth of 5% year to date led by mobile.
Bill Greer-Lee: Moving to the center of the slide, we reported healthy rebates revenue growth of 5% year-to-date, led by MOBA.
Bill Greer-Lee: Next to slide eight and Liberty Netflix on.
Next, to Slide 8 and Liberty Networks.
Bill Greer-Lee: On the left of slide we present year to date revenue for the current and prior year periods and.
Mr. Bolan: Turning to slide nine and Liberty, Puerto Rico.
Bill Greer-Lee: On the left of the slide, we present year-to-date revenue for the current and prior year periods.
Mr. Bolan: Starting on the left of the slide.
Bill Greer-Lee: And the price continues to be our fastest areas of growth in this segment was 8% higher on a rebased basis.
Mr. Bolan: We reported a stable quarter of Internet subscriber ads adjusting for the impact of ACP related Chin.
Bill Greer-Lee: and the price continues to be a fastest area of growth in this segment and was 8% higher on a rebase basis.
Mr. Bolan: As previously indicated we managed to keep most ACP subscribers to targeted retention office. However, there has been some impact with 6000 subscribers loss in Q3 and adds to the 4000, who left during the first half.
Bill Greer-Lee: As in prior quarters for Liberty, Netflix and a wholesale business specifically.
Bill Greer-Lee: As in prior quarters, for Liberty Networks and the wholesale business specifically, we highlight the $17 million year-over-year impact of non-cash IRVU declines.
Bill Greer-Lee: We highlight 17 million year over year impact of noncash <unk> declines.
Bill Greer-Lee: Despite this headwind from lower <unk> and noncash revenues are underlying wholesale business continued to demonstrate resilience growing modestly.
Bill Greer-Lee: Despite this headwind from lower IRU non-cash revenues, our underlying wholesale business continued to demonstrate resilience, growing modestly.
Mr. Bolan: Adjusting for this impact we would have had net broadband subscriber adds in the quarter.
Mr. Bolan: We continue to invest in strengthening our leading fixed business in Puerto Rico and aim to have approximately 200000 fiber to the homes passed by the end of the year representing over 15% of our total footprint.
Bill Greer-Lee: Overall, we are building a business with a strong foundation of recurring revenue which underpins our future prospects.
Bill Greer-Lee: The metrics shown beneath the bars reflect the unique cash conversion characteristics in Liberty Networks.
Mr. Bolan: In mobile our postpaid base was lower during the third quarter, partly driven by a migration adjustment of approximately 20000 lines we.
Bill Greer-Lee: This is an infrastructure business with growing cash orbiter and over 40% OFCF conversion of revenue.
Mr. Bolan: We have begun to see some encouraging signs now that the migration is complete.
Bill Greer-Lee: Given these characteristics, Liberty Networks has a very attractive financial profile, and we have spoken previously about the opportunities to invest further in this segment.
Mr. Bolan: I'll talk to these green shoots on the following slides but of note. We've now launched our new converged commercial proposition called loop.
Bill Greer-Lee: On the right side of the slide, we highlight an investment that will create a new pan-regional subsea cable system.
Mr. Bolan: Owning leading fixed and mobile platforms is a core differentiating feature for Liberty, Puerto Rico, and our strategies centered on leveraging this as we have done successfully in other parts of L. A.
Bill Greer-Lee: We are excited to share that, in addition to GoldData, we will partner with Sparkle, a wholly owned subsidiary of Telecom Italia, on this project. This will enhance the system's value given Sparkle's extensive presence in the region.
Mr. Bolan: In prepaid we had more success with a second consecutive quarter of net adds in Q3.
Mr. Bolan: This momentum should be further bolstered by the addition of Echostar boost subscribers following the close of that transaction in early September.
Speaker Change: In the center of the Slide we show the revenue mix by product in Puerto Rico, and a year to date decline of 12% Chris.
Bill Greer-Lee: New routes, the landing in Veracruz and Apalachic creates vital routes between Mexico and the United States, integrating and enhancing a powerful mesh infrastructure and ensuring we are future proof ready.
Speaker Change: Chris will cover the financial performance in greater detail within his section.
Speaker Change: Moving to slide 10.
Speaker Change: We wanted to share some of the early indicators that we feel represents signs of our mobile operations turning around.
Bill Greer-Lee: We are building a system that will serve the incredible growth in demand from hyperscalers and the rise in traffic requirements related to the ongoing shift to the cloud and AI innovations from the USA to Latin America and the Caribbean.
Speaker Change: Starting with the left chart and our average sales per month.
Speaker Change: Here, we can see that drop off in sales as we started to focus our efforts on migration in 2023 and into the first half of this year.
Speaker Change: This impact was the result of our Salesforce needing to spend more time, managing migration related queries, thereby having less time to sell while navigating some customer experience challenges.
Turning to slide nine and Liberty, Puerto Rico.
starting on the left of the slide.
Bill Greer-Lee: We reported a stable quarter of internet subscriber ads, adjusting for the impact of ACP related share.
Speaker Change: Encouragingly Q3, 2024 showed significant improvements across postpaid and prepaid.
Speaker Change: <unk> now back above 2022 levels.
Mr. Bolan: In October we saw postpaid sales flips in 2022 levels as well, which is very encouraging.
Mr. Bolan: In the center of the Slide we show our NPS progression, which is a leading performance indicators that we track closely.
Mr. Bolan: We are now above pre migration levels and significantly better than the low point at the end of the year for both postpaid and prepaid.
Mr. Bolan: Importantly, we have seen a significant increase in promoters with a postpaid promotive percentage in October three times above the December low.
Mr. Bolan: Lastly, on the right of the slide to customer sentiment.
Mr. Bolan: This metric has more than doubled from pre migration levels, reflecting the work we have been doing to improve customer experience.
Mr. Bolan: The complexity of disintegration stems from the carve out nature of this transaction with AT&T, where we needed to build a whole new network and a whole new billing stack.
Mr. Bolan: This coupled with migrating from a legacy platform within the large corporation brought many unanticipated problems.
Mr. Bolan: However.
Mr. Bolan: Our other acquisitions, we are now through the technical phase and positioned to improve our commercial execution.
Mr. Bolan: Having said that the larger than expected churn has delayed our recovery to pre migration EBITDA.
Mr. Bolan: To get that we will cut costs as required had been improving NPS and improve platforms, we will recapture market share.
Mr. Bolan: The commercial recovery will require investments in 2025.
Mr. Bolan: We are planning for.
Mr. Bolan: Leveraging our FMC capabilities combined with achieving targeted cost savings sets us up for future adjusted OIBDA expansion.
Mr. Bolan: We remain confident of our longer term plans and the opportunity to grow in Puerto Rico.
Mr. Bolan: On slide 11, we highlight our track record of organic and inorganic growth across the NW Caribbean <unk>, Panama and Liberty Costa Rica segments, Firstly, taking <unk> Caribbean on the left of the Slide is an example of strong operational execution in.
Mr. Bolan: In the periods shown from full year 2020 to the last 12 months, we have achieved an adjusted OIBDA CAGR over 30%.
Mr. Bolan: This has been driven by the effective creation and implementation of converged product offerings, which has resulted in over 350000 broadband in postpaid mobile net adds.
Mr. Bolan: We are also focused on driving cost efficiencies, achieving an eight percentage point improvement in ospf margin over the period.
Mr. Bolan: Moving to <unk>, Panama and the center of the slide into significant financial benefits of the acquisition in 2022 of cloud mobile business.
Mr. Bolan: This is an example of a successful integration.
Mr. Bolan: The middle of this year, we have migrated customers to a common platform and adjusted significant cost synergies.
Mr. Bolan: The business, we acquired from Claro had minimal adjusted OIBDA, when we close to position and so the growth shown here flex synergies, we achieved true integration.
Mr. Bolan: <unk> is expected to improve further in Q4 and rise above 'twenty 'twenty levels as a percentage of revenue.
Mr. Bolan: We also see this as an exciting organic story for coming periods, given the constructive market structure and an underweight position in the fixed market.
Mr. Bolan: Finally to Liberty Costa retail on the right of the slide.
Mr. Bolan: We initially entered the Costa Rican market through our acquisition of a controlling stake in <unk> 2018.
Mr. Bolan: Through the acquisition of telephonic, because mobile operations in 2021, we created a leading converged operator.
Mr. Bolan: This is another example of a successful integration, which we completed during 2023.
Mr. Bolan: At the time of acquisition to Telefonica business was generating approximately $70 million to $80 million of adjusted OIBDA year.
Mr. Bolan: And so we've driven significant additional value through synergies.
Mr. Bolan: We've continued to grow the mobile operations had a tremendous base, surpassing 1 million postpaid subscribers and launching <unk> earlier this year to further cement our position as the forefront of the market.
Mr. Bolan: Our track record shows that we have successfully integrated and growing operations.
Mr. Bolan: The nature of our Puerto Rico acquisition is much more complex compared to the transactions noted on the slide which is the primary reason why it has taken longer than anticipated to achieve our targets. However, our experience and track record gives us confidence that we will begin to see improved results in Puerto Rico as we have.
Mr. Bolan: In other markets.
Mr. Bolan: Finally to slide 12.
Mr. Bolan: And an exciting inorganic moves we have made in payroll.
Mr. Bolan: We began investing in a greenfield fiber to the home business alongside our local partner in 2021.
Mr. Bolan: And true and aggressive Bill now pass approximately 3 million homes in the market with fiber.
Mr. Bolan: <unk> has significant growth potential given its low internet penetration at around 40% and it provides exposure to market much larger than those in our current footprint.
Mr. Bolan: While has been very successful driving penetration in its footprint, which is mostly outside hema.
Mr. Bolan: In a short period, while achieved an approximate 15% broadband market share nationally and 25% in the provinces outside Lima.
Mr. Bolan: With 34 million people and 10 million homes in total payroll presents a large market opportunity.
Mr. Bolan: It is more than six times the size of our largest consolidated market.
Mr. Bolan: In line with the region also has a young demographic with a population median age of 34.
Mr. Bolan: Finally, we are creating a leading business and brand.
Mr. Bolan: This was exemplified as wild was awarded Latam fiber operator of the year into 2020 for fiber connect Latam Awards.
Mr. Bolan: We are excited about this investment.
Mr. Bolan: With that.
Speaker Change: Pass you over to Chris Noyes, our Chief Financial Officer, who will take you through our financial performance before we move on to your questions.
Mr. Bolan: Chris.
Chris Noyes: Thanks, Don.
Speaker Change: Now I'll take you through our financial results, starting with our group revenue and adjusted OIBDA performance on Slide 14 sequentially reported revenue was 3% lower at $1 1 billion and adjusted OIBDA grew by 4% Q4 hundred $3 million in the third quarter. The sequential decline in reported revenue from Q2 was.
Mr. Bolan: Driven by lower revenue in cable and wireless partly due to the impact of hurricane barrel in the quarter and in Panama and Liberty networks related to lower project revenue and less IRA you'd acceleration respectively.
Mr. Bolan: Adjusted OIBDA growth was driven by improvement in Puerto Rico and Panama.
Mr. Bolan: Turning to year over year revenue was 4% lower on a rebased basis, and adjusted OIBDA declined by 6% revenue performance was primarily driven by an organic reduction in Liberty, Puerto Rico, partly offset by organic growth and liberty customer.
Mr. Bolan: With respect to adjusted OIBDA organic growth in Panama, and CDW Caribbean was more than offset by reductions in liberty.
Mr. Bolan: Moving to slide 15, and our <unk> additions and adjusted Mcf results for the third quarter on the left of the slide we incurred <unk> additions of $171 million in Q3 or 16% of revenue. This compares to $187 million or 17% of revenue in the prior year peer.
Mr. Bolan: During Q3, we built or upgraded nearly 135000 homes and launched <unk> services in Panama on the right. We reported adjusted FCS for partner distributions of $77 million distributions to our partners totaled $12 million in the quarter with $10 million in Panama and <unk>.
Mr. Bolan: In Costa Rica.
Mr. Bolan: Adjusted FCS after these distributions were $66 million in Q3.
Mr. Bolan: This result compares to adjusted <unk> of $33 million for Q3 2023.
Mr. Bolan: Looking to the fourth quarter, we should deliver our strongest cash flow performance of the year driven by improved adjusted OIBDA as well as seasonally positive working capital.
Mr. Bolan: Slide 16, recaps, our segment results, starting with <unk> Caribbean, we reported $360 million of revenue in Q3 flat year over year on a rebased basis, 7% growth in mobile was offset by declines of 3% and 2% in fixed <unk>, respectively on a rebased basis mobile.
Mr. Bolan: Performance was driven by an organic increase of over 50000 postpaid subscribers year over year as we increase penetration of our fixed mobile converged propositions and higher prepaid <unk> following price increases.
Mr. Bolan: Hurricane barrel drove the reduction in fixed revenue and <unk>.
Mr. Bolan: We posted adjusted OIBDA of $158 million, representing 5% Rebased growth.
Mr. Bolan: Good result, given the storm adversely impacted adjusted EBITDA in the quarter management's focus on reducing operating cost is contributing to its adjusted OIBDA expansion.
Mr. Bolan: Our adjusted OIBDA margin improved by over 200 basis points year over year to 44%.
Mr. Bolan: Next moving to cable <unk> wireless Panama, CW P generated $188 million of revenue declining 1% year over year topline growth of 9% in mobile and 5% in fixed was more than offset by a decrease of 13% and <unk> revenue.
Mr. Bolan: Growth in <unk> was driven by broadband argue additions and mobile fueled by increases in <unk> and handset sales.
Mr. Bolan: <unk> revenue declined due to lower revenue from government related projects some of which we anticipate will be executed in the fourth quarter.
Mr. Bolan: We posted $69 million of adjusted OIBDA in Q3, representing 17% year on year growth driven by phasing of project related costs and synergies from the Claro Panama acquisition.
Mr. Bolan: Turning to Liberty networks, we generated $110 million in revenue and $59 million and adjusted OIBDA, resulting in rebased declines of 2% and 8% respectively.
Mr. Bolan: Top line performance was driven by a reduction of $4 million in noncash <unk> revenue, primarily due to lower amortization year over year, partly offset by higher enterprise revenue from continued growth in managed services and <unk> connectivity <unk>.
Mr. Bolan: Rebased adjusted OIBDA was impacted by the noncash <unk> related revenue decline in the quarter and higher bad debt expense driven by one large customer.
Mr. Bolan: From the right Liberty, Puerto Rico, Q3 revenue was $308 million, reflecting a 13% rebased decline year over year residential fixed revenue was down 4% on a rebased basis. The decline was driven by lower ARPA following retention related discounts and the impact of credits issued to customers.
Mr. Bolan: Following hurricane Ernesto, which impacted Puerto Rico in August 2024.
Mr. Bolan: Mobile revenue declined by 22% on a rebased basis. This was driven by our lower mobile subscriber base following disruption related to the migration of customers and lower equipment sales related to reduce volumes for the iPhone 16 launched in September 2024, compared to the iPhone 15 in the previous year <unk>.
Mr. Bolan: <unk> revenue declined 5% on a rebased basis, primarily reflecting the cancellation of the FCC's emergency connectivity fund, which led to a reduction of 74000 mobile postpaid subs over the past year. In addition, the migration related churn.
Mr. Bolan: We reported $88 million of adjusted OIBDA during the quarter, representing a rebased decline of 24% as compared to Q3 2023 negative performance year on year was mainly driven by lower revenue, partly offset by direct cost reductions related to lower handset sales.
Bill Greer-Lee: <unk> revenue declined due to lower revenue from government related projects some of which we anticipate will be executed in the fourth quarter.
Bill Greer-Lee: We posted $69 million of adjusted OIBDA in Q3, representing 17% year on year growth driven by phasing of project related costs and synergies from the Claro Panama acquisition.
Mr. Bolan: On a sequential basis, adjusted OIBDA improved by 24% driven by lower indirect costs, including lower bad debt reduced TSA costs and the benefits of our H one reorganization.
Bill Greer-Lee: Turning to Liberty networks, we generated $110 million in revenue and $59 million and adjusted OIBDA, resulting in rebased declines of 2% and 8% respectively.
Mr. Bolan: Concluding with Costa Rica on the far right. We delivered Q3 revenue of $146 million and adjusted EBITDA of $51 million, reflecting 5% Rebased revenue growth and a 1% rebased decline in adjusted OIBDA.
Bill Greer-Lee: Top line performance was driven by a reduction of $4 million in noncash <unk> revenue, primarily due to lower amortization year over year, partly offset by higher enterprise revenue from continued growth in managed services and <unk> connectivity <unk>.
Mr. Bolan: We delivered positive performance across all three business lines in the quarter <unk>.
Mr. Bolan: Adjusted OIBDA decreased slightly as a result of higher bad debt expense in light of increasing equipment sales and higher tower and labor expenses on a year over year basis.
Bill Greer-Lee: Rebased adjusted OIBDA was impacted by the noncash <unk> related revenue decline in the quarter and higher bad debt expense driven by one large customer.
Mr. Bolan: Slide 17 lays out our last three quarters in Puerto Rico in terms of both revenue and adjusted OIBDA for revenue Q3 reported revenue was stable relative to Q2 and I wanted to call out a few items residential fixed revenue was $123 million in Q3 or about 40% of the $308 million total.
Bill Greer-Lee: Second from the right Liberty, Puerto Rico, Q3 revenue was $308 million, reflecting a 13% rebased decline year over year residential fixed revenue was down 4% on a rebased basis. The decline was driven by lower ARPA following retention related discounts and the impact of credits issued to customers.
Mr. Bolan: Relative to Q2 fixed declined $3 million due in part to a $1 million credit we gave customers for hurricane Ernesto and the impact of lower Rps similar to fixed revenue residential mobile revenue was $125 million in Q3 or 40% of the total.
Bill Greer-Lee: <unk> following hurricane Ernesto, which impacted Puerto Rico in August 2024.
Bill Greer-Lee: Mobile revenue declined by 22% on a rebased basis. This was driven by our lower mobile subscriber base following disruption related to the migration of customers and lower equipment sales related to reduce volumes for the iPhone 16 launched in September 2024, compared to the iPhone 15 in the previous year.
Mr. Bolan: The $3 million increase in Q3 was driven by the inclusion of the acquired boost subscribers since September.
Mr. Bolan: Excluding that mobile revenue was broadly flat with higher roaming revenue offsetting slightly lower postpaid in equipment revenue the.
Bill Greer-Lee: <unk> revenue declined 5% on a rebased basis, primarily reflecting the cancellation of the FCC's emergency connectivity fund, which led to a reduction of 74000 mobile postpaid subs over the past year. In addition to migration related churn.
Mr. Bolan: The remaining $60 million or 20% of revenue consists of <unk> and other and was flat to Q2 levels. Our FCC revenue declined sequentially by $1 million turning to adjusted OIBDA. The sequential improvement was $17 million from Q2, consistent with our quarterly decline in operating expenses.
Bill Greer-Lee: We reported $88 million of adjusted OIBDA during the quarter, representing a rebased decline of 24% as compared to Q3 2023 negative performance year on year was mainly driven by lower revenue, partly offset by direct cost reductions related to lower handset sales.
Mr. Bolan: Impacting the $88 million, we still have elevated bad debt as we worked through the last components of the migration and billing and collection processes, especially with <unk> customers compared to Q2 bad debt was $6 million improved but still about $5 million higher than what we would consider a more normalized baseline.
Bill Greer-Lee: On a sequential basis, adjusted OIBDA improved by 24% driven by lower indirect costs, including lower bad debt reduced TSA costs and the benefits of our H one reorganization.
Mr. Bolan: Additionally, we had $3 million of TSA and integration related expenses in the quarter, which dropped significantly from the prior quarter turning to slide 18 at the end of Q3 on a consolidated basis, we had $8 2 billion of total debt $600 million cash and $700 million of availability under our revolving credit lines we have.
Bill Greer-Lee: Concluding with Costa Rica on the far right. We delivered Q3 revenue of $146 million and adjusted EBITDA of $51 million, reflecting 5% Rebased revenue growth and a 1% rebased decline in adjusted OIBDA.
Mr. Bolan: <unk> leverage of five two times and net leverage of four eight times at modest improvement from Q2, driven by Q3 adjusted OIBDA.
Bill Greer-Lee: We delivered positive performance across all three business lines in the quarter.
Bill Greer-Lee: Adjusted OIBDA decreased slightly as a result of higher bad debt expense in light of increasing equipment sales and higher tower and labor expenses on a year over year basis.
Mr. Bolan: Following the quarter end in October we refinanced more than 50% of our outstanding cable and wireless 2027 bonds with a new senior secured notes issuance, which was well received by the market as <unk> highlighted earlier, we raised $1 billion at a seven.
Bill Greer-Lee: Slide 17 lays out our last three quarters in Puerto Rico in terms of both revenue and adjusted OIBDA for revenue Q3 reported revenue was stable relative to Q2 and I wanted to call out a few items residential fixed revenue was $123 million in Q3 or about 40% of the $308 million total.
Mr. Bolan: 5% coupon maturing in October 2032, the net proceeds were used to redeem in full of $495 million of our 2027 senior secured notes and in part $485 million of our $1 $2 billion 2027 senior notes as a result, we extended our weighted average life at la to over.
Bill Greer-Lee: Relative to Q2 fixed declined $3 million due in part to a $1 million credit we gave customers for hurricane Ernesto and the impact of lower office similar to fixed revenue residential mobile revenue was $125 million in Q3 or 40% of the total to.
Mr. Bolan: For years, and only a roughly 10 basis point increase to our weighted average cost of debt as of September 2024.
Mr. Bolan: We actively monitor credit market conditions, and we'd expect to refinance the remaining 2027 kilowatts bonds within the next 12 months further improving our capital structure.
Bill Greer-Lee: The $3 million increase in Q3 was driven by the inclusion of the acquired boost subscribers since September <unk>.
Bill Greer-Lee: Alluding that mobile revenue was broadly flat with higher roaming revenue offsetting slightly lower postpaid in equipment revenue.
Mr. Bolan: Moving to the final slide in our closing remarks operation momentum is building in many of our operations year over year subscriber growth coupled with seasonal strength in both <unk> mobile should underpin our Q4 financial performance in Puerto Rico, clearly the pace of recovery has been much slower and tougher than we had previously anticipated.
Bill Greer-Lee: The remaining $60 million or 20% of revenue consists of <unk> and other and was flat to Q2 levels. Our FCC revenue declined sequentially by $1 million turning to adjusted OIBDA. The sequential improvement was $17 million from Q2.
Bill Greer-Lee: <unk> with our quarterly decline in operating expenses.
Mr. Bolan: Our consumer value propositions that became available. This fall are attractively positioned we are focused on regaining commercial momentum in the coming quarters, and we expect to see improved adjusted EBITDA performance in Q4.
Bill Greer-Lee: Impacting the $88 million, we still have elevated bad debt as we work through the last components of the migration and billing and collection processes, especially with <unk> customers compared to Q2 bad debt was $6 million improved but still about $5 million higher than what we would consider a more normalized baseline <unk>.
Mr. Bolan: Finally in terms of capital deployment, we had a very active quarter with two items accounting for about $240 million of cash use we repaid our remaining outstanding convertible bond at $140 million and funded the roughly $100 million initial installment of the Echostar transaction.
Bill Greer-Lee: Additionally, we had $3 million of TSA and integration related expenses in the quarter, which dropped significantly from the prior quarter turning to slide 18 at the end of Q3 on a consolidated basis, we had $8 2 billion of total debt $600 million of cash and $700 million of availability under our revolving credit lines we have.
Mr. Bolan: In Puerto Rico, and the USDA.
Speaker Change: And as <unk> mentioned, we are excited about our Peruvian opportunity and have been investing to support the build out of this fiber rich business.
Mr. Bolan: Overall for <unk>, we are driving to have our strongest quarter of the year in the fourth quarter and look forward to sharing with everyone. Our results next February.
Bill Greer-Lee: Leverage of five two times and net leverage of four eight times at modest improvement from Q2, driven by Q3 adjusted OIBDA.
Speaker Change: With that operator, please open it up for questions.
Bill Greer-Lee: Following the quarter end in October we refinanced more than 50% of our outstanding cable and wireless 2027 bonds with a new senior secured notes issuance, which was well received by the market as Bob highlighted earlier, we raised $1 billion at a seven five.
Speaker Change: Thank you the question answer session will be conducted electronically.
Speaker Change: Thank you I would like to ask a question regarding the company's operations.
Speaker Change: Steve day by pressing star one to ask a question.
Bill Greer-Lee: The 5% coupon maturing in October 2032, the net proceeds were used to redeem in full of $495 million of our 2027 senior secured notes and in part $485 million of our $1 $2 billion 2027 senior notes as a result, we extended our weighted average life at la to over.
Speaker Change: Operator.
Speaker Change: In order to accommodate everyone. We request that you only ask one question with one follow up if needed.
Speaker Change: If you are using a speaker phone. Please thank you.
Speaker Change: So for me it function.
Speaker Change: And now you're taking in order to reach our equipment.
Speaker Change: We'll pause for just a moment to give everyone an opportunity to signal for questions.
Bill Greer-Lee: For years, and only a roughly 10 basis point increase to our weighted average cost of debt as of September 2024.
Speaker Change: The first question does TJ Toro to meter of Goldman Sachs.
Bill Greer-Lee: We actively monitor credit market conditions and would expect to refinance the remaining 2027 kilowatts bonds within the next 12 months further improving our capital structure.
Speaker Change: Please go ahead.
Bill Greer-Lee: Moving to the final slide in our closing remarks operation momentum is building in many of our operations year over year subscriber growth coupled with seasonal strength in both <unk> mobile should underpin our Q4 financial performance in Puerto Rico, clearly the pace of recovery has been much slower and tougher than we had previously anticipated.
Speaker Change: Hey, Toni your line is open.
Speaker Change: Hello can you hear me.
Speaker Change: Yes, we can.
Speaker Change: Okay perfect. So my question is related to capital allocation.
Bill Greer-Lee: Our consumer value propositions that became available. This fall are attractively positioned we are focused on regaining commercial momentum in the coming quarters, and we expect to see improved adjusted EBITDA performance in Q4.
Speaker Change: I would ask if you would be open to injecting capital from the group, which supports the Puerto Rico operation in the enhanced that it needs support in the future given the.
Speaker Change: Lower than expected recovery and Theyre also already ask a follow up related to your capital allocation, though not really related to Puerto Rico, the Paragon business hazard ratio relevant market share in a fairly short time became a fair view rather than separate during there could you give more color on your strategy for our debt vehicles and on how.
Bill Greer-Lee: Finally in terms of capital deployment, we had a very active quarter with two items accounting for about $240 million of cash use we repaid our remaining outstanding convertible bond at $440 million and funded the roughly $100 million initial installment of the Echostar transaction.
Speaker Change: In Puerto Rico, and the USDA.
Speaker Change: Much capital has been allocated Subaru over the last three years to build that the investment. Thank you.
Speaker Change: And as Alan mentioned, we are excited about our Peruvian opportunity and have been investing to support the build out of this fiber rich business.
Speaker Change: Sure on the Puerto Rico, and I'll ask Chris to jumping in a bit as well our intent in Puerto Rico is to operate our way there on the cash side.
Speaker Change: Overall for <unk>, we are driving to have our strongest quarter of the year in the fourth quarter and look forward to sharing with everyone. Our results next February.
Speaker Change: Implementing cost cuts.
Speaker Change: With that operator, please open it up for questions.
Speaker Change: What we're really hot on the revenue line.
Speaker Change: And very targeted commercial <unk>.
Speaker Change: Thank you the question answer session will be conducted electronically.
Speaker Change: Acquisitions.
Speaker Change: We don't anticipate at this point of having to support Puerto Rico from any other stack.
Speaker Change: Thank you I would like to ask a question regarding the company's operations.
Speaker Change: Steve day by pressing star one to ask a question.
Speaker Change: Before I jump into my Guru answer maybe Chris do you want to add to that.
Bill Greer-Lee: Operator.
Chris Noyes: No I mean, I think that I think thats that.
Speaker Change: In order to accommodate everyone. We request that you only ask one question with one follow up if needed.
Speaker Change: Accurate.
Speaker Change: We keep a close watch.
Speaker Change: On our liquidity and we've been able to manage I think quite well with the additional spend that we had in the first half.
Bill Greer-Lee: If you are using a speaker phone. Please thank you.
Speaker Change: So for me it function.
Bill Greer-Lee: And now you are taking longer to reach our equipment.
Speaker Change: Of the year.
Speaker Change: Well pause for just a moment to give everyone an opportunity to signal for questions.
Speaker Change: One thing we did do an in Puerto Rico in Q3, as we did a handset securitization.
Speaker Change: And we've done several of those now that we're off the AT&T stack. We can continue to manage working capital in a more effective way in that business.
Speaker Change: The first question does take a two meter of Goldman Sachs. Please go ahead.
Chris Noyes: Thanks, Chris and on Peru.
Speaker Change: So we've been at it now for about three years.
Speaker Change: And.
Speaker Change: Hey, Toni your line is open.
Speaker Change: The total equity debt.
Speaker Change: Total cash that we put into the business.
Toni: Hello can you hear me.
Speaker Change: $100 million.
Speaker Change: Yes, we can.
Speaker Change: And.
Speaker Change: And clearly upon is that both the contributed some.
Speaker Change: Okay perfect. So my question is related to capital allocation.
Speaker Change: <unk>.
Speaker Change: Bill has been fast within a very very entrepreneurial team them.
Speaker Change: I would ask if you would be open to injecting capital from the group supports the Puerto Rico operation in the advanced that it needs support in the future given the.
Speaker Change: We are working with some really interesting technologies that drive our costs lower on a per bill.
Speaker Change: <unk> basis.
Speaker Change: Lower than expected recovery in there also already ask for a follow up related to your capital allocation, though not really related to Puerto Rico.
Speaker Change: And we've purposefully targeted.
Speaker Change: So out of Lima.
Speaker Change: And the reason for that being the very low penetration of broadband.
Speaker Change: <unk> business has reached a relevant market share in a fairly short time became a fair view rather than separate or in there could you give more color on your strategy part of that business and on how much capital has been allocated Subaru over the last three years to deal with that investment. Thank you.
Speaker Change: Less competition for sure less investments in those areas.
Speaker Change: Clearly we've been I think that strategy is paying off.
Speaker Change: Rob.
Rob: We're very excited about that.
Speaker Change: That investment in the future prospects in Peru.
Speaker Change: Sure on the Puerto Rico, and I'll ask Chris to jump in here in a bit as well our intent in Puerto Rico is to operate our way there on.
Speaker Change: Very clear thank you both very much.
Speaker Change: Thank you as a reminder, if you would like to ask a question. Please press star one on your telephone keypad.
Speaker Change: On the cash side.
Bill Greer-Lee: Sure.
Bill Greer-Lee: Implementing cost cuts.
Bill Greer-Lee: What we really hard on the revenue line.
Speaker Change: And the next question comes from Rebecca <unk> of Citigroup.
Bill Greer-Lee: And very targeted commercial.
Bill Greer-Lee: Acquisitions.
Speaker Change: Please go ahead.
Bill Greer-Lee: We don't anticipate at this point, having to support Puerto Rico from any of the stack.
Speaker Change: Okay.
Speaker Change: Thank you.
Speaker Change: Just wanted to understand how labor.
Speaker Change: Before I jump into my Guru answer maybe Chris do you want to add to that.
Speaker Change: Looking at opportunities and.
Speaker Change: Offer encompass bundles in the current market and if you could share metrics on how conversion could impact operational and financial performance going forward.
Speaker Change: No I mean, I think that I think thats.
Speaker Change: That's accurate.
Speaker Change: We keep a close watch on the liquidity and we've been able to manage I think quite well with the additional spend that we had in the first half.
Speaker Change: Second one would be if I may on if you can share any update on how far along.
Speaker Change: Of the year. The one thing we did do in in Puerto Rico in Q3, as we did a handset securitization.
Speaker Change: You are in the main market at upgrading five E trading <unk>.
Speaker Change: <unk> and how these upgrades can.
Speaker Change: And we've done several of those now that we're off the AT&T stack. We can continue to manage working capital in a more effective way in that business.
Speaker Change: Expand addressable market impact.
Speaker Change: Thank you.
Speaker Change: Sure.
Speaker Change: Thanks, Chris.
Speaker Change: I'll ask maybe.
Speaker Change: And on Peru.
Speaker Change: So we've been at it now for about three years.
Speaker Change: To help me on the converged part as well to give some more color.
Bill Greer-Lee: And.
Speaker Change: Because we've been a lot more advanced in the Liberty Caribbean area, even though I must say in the unconverted.
Bill Greer-Lee: The total equity that we thought the total cash that we've put into the business.
Bill Greer-Lee: $100 million.
Speaker Change: Two things one the reason we made the AT&T acquisition with Telefonica acquisition in Costa Rica.
Bill Greer-Lee: And clearly up one as opposed to contribute some.
Bill Greer-Lee: The Bill has been fast within a very very entrepreneurial deem them.
Speaker Change: In other acquisitions that we've made in human kudos.
Speaker Change: And strengthening it in Panama with the CLARCOR acquisition is to have a convergent bundles.
Bill Greer-Lee: We are working with some really interesting technologies that drive our costs lower on a per home.
Speaker Change: And the idea is that we would have a very high speed for the Baidu mobile network with a very high speed fiber to the home of DOCSIS three one network.
Bill Greer-Lee: <unk> basis.
Bill Greer-Lee: And we've purposefully targeted.
Bill Greer-Lee: Lima.
Bill Greer-Lee: And the reason for that being the very low penetration of broadband.
Speaker Change: That is our play and it is working really well and in the case of Puerto Rico as I indicated earlier, we've launched this thing called Liberty loop that Eduardo our general managers have champion together with his team.
Bill Greer-Lee: Less competition for sure.
Bill Greer-Lee: Investments in those areas.
Bill Greer-Lee: Clearly we've been I think that strategy is paying off quite.
Rob: Thanks, Rob.
Speaker Change: We're very excited about that.
Speaker Change: We are bundling both high speed broadband.
Bill Greer-Lee: That investment in the future prospects in Peru.
Speaker Change: Mobile very high speed <unk> mobile network there.
Speaker Change: Very clear thank you both very much.
Speaker Change: And the same thing applies in Costa Rica.
Speaker Change: Panama and Liberty Caribbean I'm going to answer your question on <unk>, then I am going to ask.
Speaker Change: Thank you as a reminder, if you would like to ask a question. Please press star one on your telephone keypad.
Speaker Change: And to give you a little bit more color on the success, we've been having and how we sell it you will find it very interesting because we've approached it and liberty Caribbean through our digital channels and so on.
Speaker Change: And the next question comes from Rebecca <unk> of Citigroup.
Speaker Change: Please go ahead.
Bill Greer-Lee: Okay.
Bill Greer-Lee: Thank you.
Speaker Change: <unk> <unk>.
Speaker Change: We are upgrading.
Bill Greer-Lee: Wanted to understand how labor.
Speaker Change: Suddenly got five in Puerto Rico.
Bill Greer-Lee: Looking at opportunities and.
Speaker Change: Launched it in Costa Rica.
Bill Greer-Lee: Offering Congress bundles in the current market and if you could share metrics on how conversion could impact operational and financial performance going forward.
Speaker Change: Panama and no impairment as well we are very judicious about where we make a fight.
Speaker Change: Investments it is a function of when the market's ready, meaning do we have enough handsets in the market that can support <unk>.
Bill Greer-Lee: The second one would be.
Bill Greer-Lee: If I may on if you can share any update on how far along.
Speaker Change: And also where we stand in that market.
Bill Greer-Lee: You are in the main markets at upgrading five creating <unk>.
Speaker Change: Clearly in Costa Rica, and Panama, we are the leaders in mobile.
Speaker Change: Both in volume and.
Bill Greer-Lee: <unk> and how these upgrades.
Speaker Change: Value as well as in technology, and we continue to invest there and some of the markets, where we think that <unk> is sufficient we are going to be very very careful with our capital spend and make sure that we don't spend too far ahead of where the consumers already.
Bill Greer-Lee: Expand its at the market impact.
Speaker Change: Thank you.
Bill Greer-Lee: Sure.
Bill Greer-Lee: I'll ask maybe.
Speaker Change: You got to help me on the converged part as well to give some more color.
Speaker Change: Because we've been a lot more advance in the Liberty Caribbean area, even though I must say in the convergence I'll say two things one the reason we made the AT&T acquisition, the Telefonica acquisition in Costa Rica.
Speaker Change: Having said that.
Speaker Change: Can you jump in and talk a little bit about your success in FMT.
Speaker Change: Yes.
Speaker Change: Good morning, everybody. Good morning, it'll better yes, so we've been in the last three four years within the Caribbean. The whole region. We've been really pursuing converged offers which we adapt in every single market. Because every single market of course is different we are today more or less accurately reaching a percentage of 25%. So we can still.
Speaker Change: In other acquisitions that we've made in human kudos.
Bill Greer-Lee: And strengthening it in Panama with the collateral acquisition is to have a convergent bundles.
Bill Greer-Lee: And the idea is that we would have a very high speed <unk> mobile network with a very high speed fiber to the home of DOCSIS three one network.
Speaker Change: Go and we will do that and we really looked at the consumer segment and then we adapt our offering like for example, Jamaica.
Bill Greer-Lee: That is our play and it is working really well and in the case of Puerto Rico as I indicated earlier, we've launched this thing called Liberty loop that Eduardo our general managers as champion together with his team.
Speaker Change: It really has the converged offer between data and full speed and it's really really Scotty up their route and its been.
Speaker Change: Executed over the last two years and it's really working for US is similar to what is happening Cayman, we launched the converged offer including <unk>, it's called flow Mania.
Bill Greer-Lee: We are bundling both high speed broadband.
Bill Greer-Lee: Very high speed <unk> mobile network there.
Bill Greer-Lee: And of course, the same thing applies in Costa Rica.
Speaker Change: So country by country, we go converged offerings and we adapted sometimes you do fixed mobile conversion some stance, we do mobile fixed conclusion.
Bill Greer-Lee: Panama and Liberty Caribbean I'm going to answer your question on <unk> and I'm going to ask.
Bill Greer-Lee: And good to give you a little bit more color on the success, we've been having and how we sell it you will find it very interesting because we've approached it and liberty Caribbean through our digital channels and so on.
Speaker Change: And we really start from the consumer and some of the consumer out of equal.
Speaker Change: Adapt our go to market.
Speaker Change: Dean.
Speaker Change: Really working for us.
Bill Greer-Lee: <unk> <unk>.
Speaker Change: Thank you Inger.
Bill Greer-Lee: We are upgrading.
Bill Greer-Lee: Suddenly we got five in Puerto Rico.
Speaker Change: Thank you so much.
Bill Greer-Lee: Launched it in Costa Rica.
Speaker Change: Yeah.
Bill Greer-Lee: Panama and now came in as well.
Speaker Change: Thank you and as a final reminder, if you would like to ask a question. Please press star followed by one on your telephone keypad.
Bill Greer-Lee: Very judicious about where we make a fight.
Bill Greer-Lee: Investments it is a function of when the market is ready, meaning do we have enough handsets in the market that can support.
Speaker Change: So just a moment.
Speaker Change: We have a question from Matthew mobile yard of Barclays. Matthew. Please go ahead.
Bill Greer-Lee: And also where we stand in that market.
Bill Greer-Lee: Clearly in Costa Rica, Panama, we are the leaders in mobile.
Speaker Change: Yes, good morning, and thank you for the presentation.
Bill Greer-Lee: Both in volume.
Bill Greer-Lee: Value, our service and technology, and we continue to invest in and some of the markets, where we think that <unk> is sufficient we are going to be very very careful with our capital spend and make sure that we don't spend too far ahead of where the consumers already.
Speaker Change: I had a follow up question on Puerto Rico.
Speaker Change: When I look at the slide deck from the Q2 and the slight pick from Q3's I'm trying to understand how things have developed I think.
Speaker Change: Tom.
Speaker Change: Five.
Speaker Change: Sort of migration related costs of around $28 million.
Bill Greer-Lee: Having said that.
Bill Greer-Lee: Can you jump in and talk a little bit about your success in.
Speaker Change: In the second quarter.
Bill Greer-Lee: FMC.
Speaker Change:
Bill Greer-Lee: Yes.
Speaker Change: Lead you to an EBITDA of 71.
Speaker Change: Good morning, everybody. Good morning, it'll better yes, so we've been in the last three four years within the Caribbean. The whole region. We've been really pursuing converged offers which we adapt in every single market. Because every single market of course is different we are today moura Ms accurately reaching a percentage of 25%. So we can still.
Speaker Change: Q3, the revenues have not really moved but the EBITDA has grown by about $17 million.
Speaker Change: So success.
Speaker Change: If the revenues don't really move do you only have 11 million.
Speaker Change: Of course takeaway in order to improve.
Speaker Change: GUL and we will do that and we really looked at the consumer segments and that we adapt our offering like for example, Jamaica.
Speaker Change: But then in order to reach the 45 target return I understand there is not any more actual.
Speaker Change: You really need.
Speaker Change: It really has the converged offer between data and full speed and it's really really Scotty up their route and its been.
Speaker Change: Big acceleration on the top line and so I guess my question really is how confident can we repeat that to accelerate the top line and also because it seems like the market has become a bit more competitive.
Speaker Change: Executed over the last two years and it's really working for US similar to what is happening Cayman, we launched the converged offer including <unk>, it's called flu mania.
Speaker Change: I realize the NPS and customer sentiment has improved but at.
Speaker Change: At least in my experience it takes years before.
Speaker Change: Two things can translate into financials. Thank you.
Speaker Change: Good morning, Matthew and let me see if I can answer it this way.
Speaker Change: Your math is correct.
Speaker Change: The way we are going to approach.
Speaker Change: Recovery in EBITDA comes from a number of different areas.
Speaker Change: I indicated that we're.
Speaker Change: In addition to some of the synergies we've gone from the <unk>.
Speaker Change: <unk> action given the reduction in revenue.
Speaker Change: Also tackling another round of cost cutting in the island.
Speaker Change: And the way we approach the cost cutting is.
Speaker Change: Suddenly on areas that are non growth related.
Speaker Change: So anything and any cost that doesn't touch of growth we are scrutinizing.
Speaker Change: Together with my finance team and my operating team the combination it's going through every line item and we've identified some costs that were going to close.
Speaker Change: Cost cutting that we're going to build into our 2025 budget.
Speaker Change: As you pointed out clearly just taking costs out would not get us there.
Speaker Change: We do have to invest into growth.
Speaker Change: We anticipate that you saw in the numbers, we shared we announced selling already at the pre 2022 level.
Speaker Change: And which means that our sales is coming in now two things we have to manage to one the cost of that sale.
Speaker Change: And in the mobile World clearly in the postpaid mobile room.
Speaker Change: With tier of sales and acquisition.
Speaker Change: Has very little EBITDA contribution to the way we've been approaching this is we want to grow maximally on sales and <unk> five but it will show up in early in 2006.
Speaker Change: Certain degree that's why the $45 million of move down.
Speaker Change: Secondly on the sales front, we are also focusing a lot more on <unk>.
Speaker Change: Non mobile <unk>.
Speaker Change: And we are looking at a number.
Speaker Change: A number of different opportunities there.
Speaker Change: <unk> business is about 200 million that will grow a lot more and so there are a number of projects that we're working on with a number of appointments as well look at growth in a BBB space.
Speaker Change: And then our fixed business, which has been steady as she goes that's a really good business.
Speaker Change: Very good share.
Speaker Change: In a very very good product.
Speaker Change: A combination of fixed and mobile, which we've never been able to do throughout the last three years. When we had the systems with AT&T, we were never able to converge. These products. We are now looking in every of our move outs.
Speaker Change: To see if they have broadband and every of our broadband sub to see if they have mobile and that is what we call Liberty loop, which we are now putting in place a number of really exciting commercial initiative for our customers, but also foreign sales group.
Speaker Change: To incent them to sell this product so there's a lot of different moving parts here and how we wanted to get back on that.
Speaker Change: Then on the EBITDA that I think my management team and I feel it's appropriate for this for this business.
Speaker Change: That's very helpful. Thank you if I can pull up obviously, you will have to echostar subscriber base.
Speaker Change: At some point in 2025.
Speaker Change: If I put that in the complex of the difficult integration.
Speaker Change: Yeah.
Speaker Change: Things.
Speaker Change: You'll learn.
Speaker Change: Or do you feel about demand because it's a much easier transition than what's happened with the chips I realize you have to operate on their system, but could you I mean could you give a bit of color as to how youre looking to the upcoming integration.
Speaker Change: Okay I'll give you three specific point to why.
Speaker Change: This is going to be a lot more smoother one we already have a network now we didn't have a mobile network. When we bought <unk> and we had to stand it up and get it operational and scale. While we were migrating that's done. So we have the network, we can migrate to <unk>.
Speaker Change: Second.
Speaker Change: And <unk> now that we didn't have when we bought the AT&T business, we had in Nike stack, but with the fixed network IP stack.
Speaker Change: The robot.
Speaker Change: Is that if you recall I mean.
Speaker Change: We actually have that in our business. When we did this migration of this acquisition is part of the conditions on the acquisition, we would not able to use our existing <unk> and mobile networks.
Speaker Change: That said in Puerto Rico, because this is an American business at that point, we had to change our strategy and build everything from scratch.
Speaker Change: The AT&T business look within the United States or else you would have moved a lot more smoothly. If we didn't have to build a whole new IP.
Speaker Change: And mobile network.
Speaker Change: And then the third reason is.
Speaker Change: This is on prepaid so theres no complexity and lots of billing that we experienced with the postpaid migration from AT&T. So those three things makes it a lot easier but to be sure that as well. We do have some things that were working on because there are a number of handsets.
Speaker Change: On the dish network, it's actually the T mobile network that may not work in our.
Speaker Change: In our Ericsson networks.
Speaker Change: In that sense.
Speaker Change: Our technical teams are going to work very closely.
Speaker Change: And the handset compatibility is probably the only thing I am really concerned about in that migration.
Speaker Change: Thanks for your useful thank you.
Speaker Change: Thank you. The next question does he Matthew Harrigan of the benchmark company.
Speaker Change: Go ahead.
Matthew Harrigan: Well thank you.
Speaker Change: Something in the currency market.
Speaker Change: And in part the strong dollar.
Speaker Change: That's the only one.
Speaker Change: Rob very vocally.
Speaker Change: <unk> you talked about.
Speaker Change: I think at one point you were well above.
Speaker Change: With that on the U S dollar softness or without.
Speaker Change: So.
Speaker Change: The dollar can you talk about updated thoughts on that and also maybe.
Speaker Change: Implications in your capital structure for that.
Speaker Change: Hum.
Speaker Change: Operator.
Speaker Change: Importantly.
Speaker Change: I don't think that makes it so.
Speaker Change: Have a good tourism bump there and then you'd have the countervailing effect on the on the ground poison, but how are you thinking about your business. If we did have a significant.
Speaker Change: A significantly stronger dollar.
Matthew: Hey, Matthew.
Speaker Change: We haven't put like lots of notes is behind US I will say a few things.
Speaker Change: As you pointed out we are already in the 70% <unk> on U S. Dollar so our exposure to a lot less we don't have Chilean pesos and stuff like that right, where its very volatile, but having said that Chris Noyes and our treasury team has hedged.
Speaker Change: Not only hits the cost, but we also hedged the currency on and most of where we operate that is sufficient liquidity to do that there are a couple of exceptions, but it's not needle moving to us and so.
Speaker Change: So on the currency side, the only thing I would say with the new elections is that the president elect.
Speaker Change: <unk> publicly indicated that he is going to try to.
Speaker Change: If you look at a weaker U S dollar going forward, how he does it who knows but.
Speaker Change: Of course as you know.
Speaker Change: It could be helpful. What could not be helpful is high tariffs because we do import a lot of equipment and equipment from Asia, especially for CPE and.
Speaker Change: Thats equipment on handsets as equipment network equipment.
Speaker Change: I think it's wait and see and learn more.
Speaker Change: Not adjusting any of our internal budgets reflect any of this.
Speaker Change: But it's one that we are going to be watching closely.
Speaker Change: Chris do you want to add and Paul.
Chris Noyes: Yes, I would say what I would say, Matt when you when you look at our portfolio.
Speaker Change: <unk>.
Speaker Change: Operating assets, it's really Jamaica, and Costa Rica are the two that that float.
Speaker Change: For us.
Speaker Change: Most of our other businesses are U S dollar or us dollar AG link et cetera. So we have just a little bit of exposure there the Costa Rica, Costa Rica has been particularly stable and has actually been strengthened over the last few years and similarly, Jamaica has been.
Speaker Change: Quite a nice currency over the last five years Hasnt depreciated much.
Speaker Change: So I think we feel really good from from the mix of assets that we have and we do hedge from a forward perspective, you know when we do have mismatches and then where we can we will hedge components of the debt payment.
Chris Noyes: Thanks, Chris.
Matthew Harrigan: Yes, Thanks, Matt.
Speaker Change: Thank you that will now conclude todays question and answer session I would like to hand back to <unk> for any additional remarks.
Speaker Change: Thank you operator, and maybe I'll say a couple of things before we close one.
Speaker Change: Clearly.
Speaker Change: We will all surprise here in the management team on the performance in Puerto Rico between the last quarter and this quarter. There were a number of reasons for that to price. Some of the post migration customers that came over was not what we thought it was and.
Speaker Change: And we learned a lot during that period.
Speaker Change: Assured this management team is focused on recovering those losses.
Speaker Change: P. J I think in Puerto Rico's really bright some advanced move ahead to do that transaction all over again with I've done it I would.
Speaker Change: Clearly in the migration, we are a lot smarter, but when you buy something from a very large corporation.
Speaker Change: The one billing systems or legacy in the way they run in and it's very different than how we would run the business.
Speaker Change: There are lots of complexities that we did not anticipate but I can tell you. This.
Speaker Change: We've learned a lot.
Speaker Change: Going to fix a lot of the firms.
Speaker Change: We are already seeing the green shoots we're going to solve this.
Speaker Change: Topline growth and cost cutting.
Speaker Change: And then we will get out of the woods. The remaining part of our business you can see all the hard work that we did it's paying off a lot of complex transactions that won't buy something from collateral and integrating in Panama buying something from telefonica integrating it in Costa Rica with cost cutting that my management team has been in Liberty Caribbean.
Speaker Change: Opportunities of investments in both Peru, and I can tell you I'm really excited about our subsea network and are met general manager that runs at this new network. The rebuilding that will create huge opportunities in 2007. So we are planning the seeds for future growth.
Speaker Change: Already improved a lot of our operations and growing them. We have one operation right now the challenge and we're going to fixed rate and get through it and then we're going to grow that as well.
Speaker Change: From that sense I can tell you.
Speaker Change: Excited and bullish about the future and I. Thank you for your support.
Speaker Change: Yeah.
Speaker Change: Thank you ladies and gentlemen, this concludes Liberty Latin America that quarter 2020 for Invesco.
Speaker Change: A reminder, a replay of the call will be available in the Investor Relations section of Liberty Latin America's website at <unk>.
Speaker Change: Www count.
Speaker Change: Dot com.
Speaker Change: And you can also find a copy of today's presentation materials.
Speaker Change: Thank you you may now disconnect your lines.