Earnings call transcript: Liberty Global Q4 2024 results miss forecasts

Liberty Global (NASDAQ: NASDAQ:LBTYA) reported its fourth-quarter 2024 earnings, revealing a significant miss against analyst expectations. The company posted a loss per share of $0.55, compared to a revenue forecast of $1.92 billion, with actual revenue coming in at $1.12 billion. Following the announcement, Liberty Global’s stock price fell by 2.63% in after-hours trading, closing at $11.09, near its 52-week low of $8.09. According to InvestingPro analysis, the company currently trades below its Fair Value, suggesting potential upside despite recent challenges. InvestingPro data shows the company maintains impressive gross profit margins of 66.59% and generally trades with low price volatility.

Key Takeaways

• Liberty Global’s Q4 2024 results missed revenue and EPS forecasts significantly.
• Stock price dropped by 2.63% in after-hours trading, reflecting investor disappointment.
• The company continues to invest heavily in fiber networks and AI initiatives.
• Executed substantial debt refinancing and share buybacks in 2024.
• Committed to asset sales and share buybacks in 2025.

Company Performance

Liberty Global’s performance in Q4 2024 fell short of expectations, with both earnings and revenue missing analyst forecasts. Despite these challenges, the company maintained a strong focus on infrastructure investments, particularly in fiber and 5G networks across Europe. The company’s strategic moves, including debt refinancing and share buybacks, underscore its commitment to strengthening its financial position. InvestingPro research reveals management has been aggressively buying back shares, with the company maintaining a solid current ratio of 1.05. Get access to over 30 additional key metrics and insights with InvestingPro’s comprehensive research report.

Financial Highlights

• Revenue: $1.12 billion, below the forecast of $1.92 billion.
• Earnings per share: Loss of $0.55.
• Total (EPA:TTEF) shareholder remuneration: $4 billion in 2024.
• Cash balance: $2.2 billion at the end of Q4 2024.
• Share buybacks: $700 million executed in 2024.
• Debt refinancing: $3 billion completed.

Earnings vs. Forecast

Liberty Global’s Q4 2024 earnings per share of -$0.55 and revenue of $1.12 billion were significantly below the forecasted figures. The revenue miss was approximately 41.7%, highlighting a substantial deviation from expectations. This performance contrasts sharply with the company’s historical trends, where it has often met or exceeded market forecasts.

Market Reaction

The market reacted negatively to Liberty Global’s earnings miss, with the stock declining by 2.63% in after-hours trading. This drop places the stock closer to its 52-week low of $8.09, reflecting investor concerns about the company’s ability to meet future financial targets. The broader market trend has shown resilience, making Liberty Global’s performance stand out as a point of concern for investors.

Outlook & Guidance

Looking forward, Liberty Global is targeting $500-$750 million in non-core asset sales and a 10% share buyback in 2025. The company aims to limit corporate EBITDA losses to no more than -$200 million, with a strong emphasis on generating free cash flow across its markets. Despite the current setbacks, Liberty Global remains committed to its strategic initiatives and growth objectives. InvestingPro data shows the company generated $723.5 million in levered free cash flow over the last twelve months, with an EBITDA of $941.9 million. Discover more detailed financial analysis and forecasts by accessing the full InvestingPro Research Report, which provides comprehensive insights into Liberty Global’s financial health and future prospects.

Executive Commentary

CEO Mike Fries emphasized the company’s proactive approach, stating, "We ain’t waiting around anymore for you to figure it out. We’re just going to prove it." Fries also highlighted the focus on buybacks, deleveraging, and strategic investments, underscoring the company’s commitment to enhancing shareholder value.

Risks and Challenges

• Revenue shortfalls and earnings misses could impact investor confidence.
• Ongoing investments in infrastructure may strain financial resources.
• Competitive pressures in the European telecom market.
• Economic uncertainties and potential regulatory changes.
• Execution risks associated with asset sales and strategic initiatives.

Q&A

During the earnings call, analysts inquired about several strategic areas, including the spectrum acquisition in the UK and the valuation strategies for infrastructure assets. The company addressed questions on its mobile strategy, focusing on premium and volume brands, and provided insights into working capital expectations.

Full transcript - Liberty Global PLC (LBTYA) Q4 2024:

Conference Operator, Liberty Global: Good morning, ladies and gentlemen, and thank you for standing by. Welcome to Liberty Global’s Fourth Quarter twenty twenty four Investor Call. This call and the associated webcast are property of Liberty Global and any redistribution, retransmission or rebroadcast of this call or webcast in any form without expressed written consent of Liberty Global is strictly prohibited. At this time, all participants are in a listen only mode. Today’s formal presentation materials can be found under the Investor Relations section of Liberty Global’s website at libertyglobal.com.

After today’s formal presentation, instructions will be given for a question and answer session. Page two of the slides details the company’s safe harbor statement regarding forward looking statements. Today’s presentation may include forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including the company’s expectations with respect to its outlook and future growth prospects and other information and statements that are not historical facts. These forward looking statements involve certain risks that could cause actual results to differ materially from those expressed or implied by these statements. These risks include those detailed in Liberty Global’s filings with the Securities and Exchange Commission, including its most recently filed Forms 10 Q and 10 K as amended.

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

Mike Fries, CEO, Liberty Global: I would now like to turn the

Conference Operator, Liberty Global: call over to Mr. Mike Fries.

Mike Fries, CEO, Liberty Global: All right. Thank you, and welcome everyone to our year end investor call. It’s great to have you join us today. I’ve got the core team on the line as usual, so after prepared remarks, we’ll get right to your questions. And as a reminder, we always post a slide deck, which has really good data and follows the narrative that Charlie and I will deliver right now.

So I’m going to start on Slide three. Most of you know who we are and you know what we do. But it’s always good, I think, to start with the big picture, especially now. Twelve months ago on this call, we presented a plan to generate and importantly deliver value to our shareholders. That’s exactly what we did in 2024 with over $4,000,000,000 in shareholder remuneration delivered on a market cap of $7,000,000,000 just twelve months ago.

And as we’ll talk about today, this remains our primary focus. So to kick us off, I think the chart here on this slide is the simplest, least complex way to understand the business of Liberty Global today. We consider ourselves to be a dynamic team of veteran operators and investors committed to generating and delivering shareholder value through the strategic management of three platforms. Liberty Telecom (BCBA:TECO2m) consists of our four remaining European telcos, you know these well, in The UK, Ireland, Belgium and The Netherlands, serving $80,000,000 fixed and mobile connections and generating $22,000,000,000 of aggregate revenue and around $8,000,000,000 of aggregate EBITDA. And I’ll talk about our strategic plans for growing and ultimately crystallizing the value of these six mobile champions in just a moment.

The growth represents our $3,100,000,000 portfolio of investments in technology, media, sports and infrastructure. And we’ve grown this business substantially over the last five years. We’ve also been really disciplined about exiting positions at good returns and then repurposing that capital both into Liberty Telecom and additional growth investments. And then Liberty Services on the right is a hidden gem. Over the last several years, we have successfully transitioned over two thirds of our central employee base into profitable revenue generating activities in tech and financial services.

These are valuable operating divisions with long term contracts, nearly $600,000,000 of annual revenue, third party partnerships and really viable strategies to continue growing and ultimately monetizing these businesses for the benefit of shareholders. So why make a big deal of this, you might ask? Well, when your stock is $11 and you have $350,000,000 shares outstanding, we become hyper aware of the fact that even small opportunities like this can move the needle, which is a great segue to the next slide. And as I just mentioned, on our year end call last February, we announced a clear strategic pivot, right? We outlined a game plan at that time focused on maximizing the intrinsic value of our assets and delivering that value to shareholders.

Not surprisingly, the most important initiatives, which are summarized here on Slide four, revolved around Liberty Telecom, where the gap in value and the upside to shareholders was and remains the largest. The big headline was, of course, our commitment to spin off 100% of Sunrise, our Swiss subsidiary to Liberty Global shareholders before year end. The logic and timing of that transaction was compelling. Sunrise operates in a rational market. The company had been delivering solid operating performance, driven principally by strong free cash flow and the potential for sizable dividends.

And we saw strong local investor demand to own the number one challenger to Swisscom (SIX:SCMN). Now trust me, this was a complex transaction, but these are the things that this management team really excels at, in fact. The spin off was completed on time and effectively delivered to our shareholders a $9 per share tax free dividend was at the time an $18 stock. And we did that by spinning off 20% of our proportionate EBITDA. I’ll let that sink in.

Now by all accounts, this was a success. Sunrise stock is trading well with 70% of the ADSs now converted into local Swiss shares. And we’ve learned a really valuable lesson on how to unlock value. We also announced last year our intention to create a fixed netco in The UK market to accelerate and fund a portion of our fiber build out and to provide a vehicle for what we expect will be a rapidly consolidating infrastructure market. And I’m happy to report that we are making significant progress on this front.

The operational and financial perimeters of the UK NECCO have been established. They represent around 16,000,000 homes and over £1,000,000,000 of EBITDA. But more importantly, as of last week, we are in receipt of proposals from a handful of the strongest infrastructure investors in the business who have indicated an interest in participating with us in what will be, I think, the only viable long term competitor to BTO per And then finally, we discussed the opportunity to focus our attention and resources on the Benelux region. And while the prospect of a combined Dutch and Belgian operation is intriguing, we spent most of our time last year ensuring that each business is achieving its strategic and financial potential individually. And this included hiring a new CEO for Porto von Ziggo, Stephen Van Rohein, who hit the ground running in September.

And in Belgium, where we’ve already separated the network from Telenet, we’ve made substantial progress with the Belgian government to rationalize the fiber market through a network sharing and collaboration agreement between Wire, that’s our Netco, Telenet and Proximus. Even prior to the conclusion of that transaction, our treasury team just closed on a EUR500 million standalone facility for wire’s fiber rollout. That just supports the attractiveness of this market opportunity. Now in addition to our objectives for Liberty Telecom, we also announced a series of other key goals last year, and those are listed on Slide five, that we knew would anchor our value creation strategies. At the Liberty Global level, we committed to buying back up to 10% of our shares outstanding, and we spent approximately $700,000,000 doing that.

As a reminder, we have now spent roughly $15,000,000,000 over the last eight years to acquire over 60% of our shares. Now obviously, we believe in the multiplier effect of stock buyback. For example, if you own 1% of Liberty Global in 2017, you ended up with 2.5 of Sunrise at the spin off date. We also committed to refinance all of our 2027 maturities in the Liberty Telecom debt silos and we did that with over $3,000,000,000 in refis at Vodafone (NASDAQ:VOD) and VMO2. Acharya will get into more detail, but our balance sheet remains rock solid.

And we achieved all 14 of our financial guidance metrics with the exception of one, which is related to Vodafone Zego revenue, where we had guided to growth but came in flat due to slower mobile net adds and a lower mobile handset sale number. To implement our strategic goals, we also committed to sell assets amounting to $500,000,000 to $1,000,000,000 in 2024. That number came in at $900,000,000 and together with free cash flow helped fund the buyback and deleveraging at Sunrise to maximize the equity value of the spin for shareholders. And we articulated a clear preference to prioritize future investments in Liberty Growth around scale based platforms with tailwinds. And of course, the best example here is the acquisition of our controlling interest in Formula E, which I’ll talk about in just a moment.

Now here’s the kicker. Despite hitting the mark on the strategic goals in 2024, Liberty Global shares pro form a for the spin off of Sunrise remain significantly undervalued. I’ll walk you through how we see it on Slide six, which lays out a pretty simple sum of the parts analysis. Some investors like it when we just get down to the brass tacks, as they say, and this is how we run the business. So here you go.

The first key point to make on this chart is that we think our stock today assigns zero equity value to Liberty Telecom. How do we get to that conclusion? Well, the first three columns here show our cash balance and the combined fair market value of our Liberty growth portfolio, and that adds up to about $15 per share. And then we assume an appropriate reduction per corporate of $4 per share, which we’ll dive into later. But with that, you essentially get to a market price of $11 per share.

So what is the right value for Liberty Telecom, the blue bar there? There are many ways to approach this, as you know all too well, but the Sunrise spin demonstrated the potential uplift in trading multiples when you find the right transaction or market opportunity. Case in point, as part of Liberty Global, Sunrise traded essentially at our combined and current multiple of 5.5 times EBITDA. As a listed company in Switzerland, Sunrise trades at eight times EBITDA or a 7%, eight % dividend yield. Now assuming every operating company

: should

Mike Fries, CEO, Liberty Global: be worth eight times, that might be ambitious, right? But if you assume a conservative one multiple uplift in the value of Liberty Telecom, say from 5.5 times to 6.5 times EBITDA, by the way, which is the EU telco sector average and where most analysts have us, then you arrive at $14 per share for Liberty Telecom alone. Now we’ve certainly shown you higher numbers for Liberty Telecom in the past, but given what we’re trading today, we’re happy to be conservative. Adding all that up gets you to $25 per share for Liberty Global, and that’s before signing any equity value for Liberty Services. We’re not putting a number on that today, but I can tell you it’s greater than zero.

Then lastly, this compares to average analyst price targets of around $14.6 Now one of the big differences is the deduction of corporate, which is typically twice the number we’re using, but completely neglects the fact that these net central costs are nearly 100% variable OpEx and should be valued on an EBITDA multiple. More on that from Charlie. At this point, the question you should be asking is how do we intend to continue bridging this gap? We’ll try to address that on Slide seven with a summary of our strategic plan for 2025 and beyond. And as you just saw, there is significant upside to improving the real or perceived value of Liberty Telecom.

Just one additional EBITDA multiple more than doubles our stock. So not surprisingly, we believe there will be opportunities to crystallize or monetize the value of Liberty Telecom’s businesses over time. Like summarized, this could include spinoffs, although as many of you know, this decision is dependent on several tax, legal and financial factors. We could also consider tracking stocks, IPOs and of course, we always remain open to M and A options. To achieve any of these though, we need to pursue three tactical steps.

Number one, we have to continue to drive commercial momentum at the operating level. This is the primary objective of every local management team. They are all focused on expanding loyalty programs to reduce churn, promoting robust flanker brands to drive market share, realizing the benefits of digital and AI, accelerating B2B and rolling out new revenue streams. Second, we’ll continue to creatively finance our fixed network infrastructure, particularly in The UK, Belgium and Ireland, where our fiber plans are well underway. These infrastructure assets trade at higher multiples, attract a unique type of investor and can absorb more leverage than what we are typically seeing on Servco.

So we want to take advantage of these factors and we will. And third, our ability to achieve greater value recognition at Liberty Telecom will to a large extent be dependent on generating free cash flow, especially free cash flow that can be used for dividends. So the Sunrise model demonstrated this clearly. As a result, we’re squarely focused on achieving this goal over the next twenty four to thirty six months. Now moving to Liberty Growth, our plans take two forms.

On the one hand, we recognize that many of the assets we own today are non core and as we demonstrated in 2024, can be highly accretive sources of cash for more strategic opportunities. So as a result, we will continue to rotate capital into higher return Liberty Growth assets, prioritizing infrastructure, sports and media, as well as into strategic Liberty Telecom transactions. Towards that end, we are committing today to sell between $500,000,000 and $750,000,000 of non core assets in 2025. And then finally, our cash balance of $2,200,000,000 is a significant strategic asset. Our primary use here will be for buybacks, deleveraging and the investments described above.

Specifically, we’re committing to buying up to 10% of our shares outstanding in 2025 as we did last year. And we anticipate that our cash Charlie will talk about our Liberty Services platform and corporate spend in a moment. I’ll just say watch this space. Both of these are expected to be meaningful contributors to our value creation narrative. Now turning to the next slide, I’ll just spend a minute on our Q4 operating results.

You would have reviewed these already and we do have the OpCo leads on the call. The punch line here is that we’re seeing steady or improved broadband results with continued fixed ARPU uplift in most of our markets. And we also saw a small pickup in postpaid mobile, particularly in The UK. Sticking with VM02, The UK saw another strong broadband quarter at 12,000 net adds supported by new homes in the next fiber territory and really good base management. All of this despite aggressive alt net pricing and what looks like a flat broadband market overall.

It was also the third straight quarter of fixed ARPU growth in The UK, reflecting material better retention as a result of our digital and AI tools. And the M02 also saw a significant turnaround in postpaid mobile throughout the year. We lost nearly 200,000 subs in the first half of the year and were essentially flat in the second half with a positive net add quarter in Q4. You contribute this to two things, I think strong results from Gift Gaff, our flanker brand and success in underpinning the premium position of O2. Now some quick remarks in Ireland.

This is a small operation with largely stable results, but we want to start adding this to the narrative here. Virgin Media Ireland is the farthest along on the fiber transformation with around half of our 1,000,000 premises already upgraded, almost 50,000 fiber customers on our network, including Vodafone and Sky wholesale customers. Now while CapEx will remain elevated in 2025, we should be largely done with the bill by the end of this year, early next year. And like many European telcos, the decline in CapEx should drive meaningful free cash flow over the long run. Turning to The Netherlands, we saw intense competition in the Dutch brand broadband market continue with losses mostly price led in Q4.

Vodafone ZIGO remains focused on value over volume with largely flat ARPU in the quarter. On the positive front, UEFA rights are driving uptake across different channels, including through ZIGO Sport. The Dutch mobile market is more rational, but has seen lots of price competition in the no frills segment. Nonetheless, we have delivered stable net adds as the impact from B2B port out stabilized and FMC (NYSE:FMC) SIMS penetration continued to increase. And then lastly, on Telenet, they returned to positive broadband net adds for the first time in two years in the fourth quarter, and that was underpinned by successful fixed mobile convergence campaigns, including the new base proposition, which is exceeding expectations.

And fixed ARPU growth continued to be supported by the price rise earlier this year and mobile postpaid decreased modestly in the quarter driven by challenging market dynamics. So two more slides on Liberty Growth before I turn it over to Charlie. Understandably, we get a lot of questions about the portfolio and hopefully our disclosures this quarter and in future quarters will demonstrate that we are committed to providing greater transparency and information to you, especially as this becomes a bigger part of our valuation story. Towards that end, Slide nine provides two important pieces of data. First on the left, you’ll see our investment activity over the last five years in the aggregate.

At the end of twenty nineteen, so five years ago, our investment assets totaled around $900,000,000 in what we now call Liberty Growth. Between 2019 and the end of twenty twenty four, we invested an additional 2,400,000,000 in our tech, media and infrastructure verticals, plus some strategic holdings. During that same period, however, we also exited investments that returned $1,200,000,000 to us, including dividends, with a weighted average IRR of 25%. Now this includes the good and the bad deal. So this is a true measure of those disposals.

That left us with net invested capital in the portfolio at the end of last year 2024 of $2,100,000,000 compared to a fair market value in our 10 ks of $3,100,000,000 That valuation by the way is independently reviewed by Deloitte and breaks down between tech, media, infrastructure, etcetera, as shown in the color legend at the bottom. So we’re sitting on $1,000,000,000 of unrealized gains in the portfolio today. I already mentioned that we intend to generate between $500,000,000 and $750,000,000 in sale proceeds this year, a significant portion of which will likely come from Liberty Growth. The Liberty Growth is a diversified portfolio with investments in upwards of 70 different companies. I get that, that creates some complexity for you.

But on the right hand side, we make the important point that 75% of our portfolio resides in just seven investments, and we list those here. This includes three media holdings, Formula E, ITV (LON:ITV) and TeleVC Univision three infrastructure investments, Atlas (NYSE:ATCO) Edge, EdgeConnex and Next (LON:NXT) Fiber and our stake in Vodafone. Now we’re not discouraging you from focusing on the balance of our investments, but I do think it makes it simpler when we present it like this. These are the assets that you’ll be hearing about, we’ll be talking about and that more often than not will be driving our returns. Now I’ll end on a super high note.

I think everyone knows we increased our stake in Formula E to 66% last year when we bought out Warner Bros. Discovery (NASDAQ:WBD). And I have to say, I couldn’t be more excited about that transaction and where this championship is going. Slide 10 just hits a few of the key points, the key highlights, beginning on the top left with the car itself. When we first invested in Formula E, we made a bet on technology innovation and that bet is paying off.

The first generation car topped out at 140 miles per hour and really couldn’t drive very far. We are now in what we call the Gen three EVO car and it is a rocket ship It has speeds capable of 200 miles per hour and the car accelerates 30% faster than an F1 car zero to 60 in just one point eight two seconds. And we have the Gen four car coming out in just eighteen months’ time, which aims to double the power. I think the point is that these cars are lightning fast, no pun intended, and the racing is more and more exciting every year. As you can see on the top right, we already race some of the most iconic cities in the world, places like Sao Paulo, Mexico City, Jetta, Miami, Monaco, Tokyo, Shanghai, Jakarta, Berlin and London.

With a faster car and longer races, we expect to gain access even more tracks and venues. Even though we’ve been net zero since day zero, this is all about the racing, right? It’s no surprise to me, shouldn’t be to you that we’ve attracted some of the world’s greatest racing brands, including Porsche, Jaguar, McLaren, Maserati, Nissan (OTC:NSANY), Penske, Andretti and others. They’re part of this global championship because they see the future and the potential. By 02/1935, nearly 70% of global car sales are expected to be electric vehicles.

And we have an exclusive on this racing series with the FIA, who by the way are great partners of ours for many, many years to come. And then finally, word is getting out. We’re now at roughly 400,000,000 fans globally, and that’s growing 23%. You’ll also see on the bottom left that while there are two championships with bigger audiences today, F1 and MotoGP, neither is growing as fast. Remember, we’re a very, very young championship, at least compared to Formula one, which is 75 years old, but the ceiling feel seems unlimited.

So stay tuned for more updates on what is now consolidated asset, Formula E. And Charlie, with that, I’ll send it over to you.

Charlie, CFO, Liberty Global: Thanks, Mike. The next slide sets out a summary of the quarterly revenue and EBITDA performance in our key markets. Telenet reported a revenue decline of 0.4% year on year in Q4, primarily driven by declining customers, which was partially offset by the 3.5% price rise in June and the continued shift towards higher tier broadband plans. Virgin Media two reported a revenue decline of 2.8%, excluding the impact of next fiber construction, driven by decreases in mobile revenue due to lower handset sales and B2B revenue. Encouragingly, underlying mobile service revenues were stable and residential fixed revenues increased in the year.

Vodafone Zigger reported a revenue decline of 2.5% in Q4, primarily due to a decline in the consumer fixed customer base, lower out of bundle revenue and a decrease in low margin handset sales. This was partially offset by growth in Ziggo Sport Total subscribers and continued growth in B2B revenue. Moving on to our Q4 adjusted EBITDA performance, Telenet’s adjusted EBITDA decreased 3.9% in Q4, driven by wage increases and higher programming costs and BMO2’s adjusted EBITDA in Q4 decreased 5.9% excluding the impact of Next Fiber construction. In addition to the revenue impacts, the decrease was impacted by increased marketing investments on the Next Fiber footprint reduced year on year growth in the B2B segment. Vodafone Ziggo reported an adjusted EBITDA decrease of 4.8%, driven by the decrease in revenue, higher programming costs related to UEFA broadcast, wage increases relating to the collective labor agreement and an $8,000,000 1 off impact following the sale of certain handset receivables during the quarter.

Turning to our next slide, we continue to remain committed to a strong capital allocation model. In terms of cash generation, we surpassed free cash flow guidance at Telenet and achieved our target for Liberty Services and corporate adjusted EBITDA less P and E additions. At Burjometer O2, we successfully delivered £850,000,000 of cash distribution to shareholders in 2024 with full year free cash flow of £500,000,000 supported by a working capital benefit of approximately £200,000,000 Vodafone Zigger delivered €228,000,000 total cash distributions, which which are modestly lower than the full year 2024 free cash flow after allowing for spectrum payments during the year. The majority of cash distributions from VMO2 and VodafoneZiggo were received in Q4 as in previous years. We ended Q4 with a substantial cash balance of $2,200,000,000 even after the $1,600,000,000 capital injection to Sunrise before its Q4 spin.

Total cash inflow from operations and JV dividends was around $500,000,000 We executed a further $200,000,000 in buybacks this quarter, bringing the total to $700,000,000 for the year and resulting in approximately $350,000,000 shares remaining at the end of twenty twenty four. Looking to our CapEx trends, we continue to invest in our fixed and mobile networks in line with our capital intensity targets. As a reminder, last year at VM02, we highlighted over £500,000,000 of spend in 2023 on five gs capacity and fiber up, which has continued in 2024 and will continue in 2025. At Telenet, the step up in CapEx will support an additional 375,000 homes passed by year end 2025 at YAR and will also ramp in five gs digital CapEx at Servco. We expect capital intensity in the Telenet Servco to decline in 2026 as the major investments in the mobile network will be completed in 2025.

While CapEx will also be fully debt financed through an agreed CapEx facility, meaning no equity requirement from Liberty Global or Telenet. And lastly, our investment into AI initiatives are anticipated to drive $200,000,000 to $300,000,000 of annual benefits across Liberty Telecom over the next three years. Initial focus areas are using AI to better manage customer, for example, with agent assist to provide real time support, networks, for example, improve in house customer experience through preventative care and diagnostics, and in customer workplace experience, for example, in our entertainment and connectivity programs. This is equivalent to approximately 2% of telecom OpEx with roughly 70% of the benefits focused on cost savings and 30% helping to drive revenue through customer acquisition and retention initiatives. Moving to our balance sheet, our silo debt stacks have an average tenure of approximately five years with no material maturities until 2028.

Our aggregate debt is split equally between bank debt and bonds with the bonds typically issued with a longer duration of ten years as compared to the bank debts of eight to ten years. Our variable bank debt is fixed using swaps, which are independent of the underlying debt. This allows us to refinance near term maturities and extend the tenure, but also benefit from the underlying swaps. Now in general, we look to manage our debt maturities so that there are no material refinancing commitments in the next three years. In 2024, we successfully refinanced all debt maturities due before 2028 and in Q4 completed a green bond issuance for Vodafone Ziggo as well as a $500,000,000 term loan extension in VM02.

Now all of these refinancings were secured in line with our historic credit spreads, and we continue to see strong appetite for our debt securities. We also use the bank market to finance large CapEx builds. We just agreed a EUR 500,000,000 standalone CapEx facility for Wire and during 2024, we also secured similar bank financings for our growth assets, for example, EUR $273,000,000 of project and land banking facility for Addus Edge. On the next page, we lay out the key financials for Liberty Services and corporate. Our corporate group provides management and advisory services focusing on financial and human capital as well as technology expertise, but we also have two other revenue generating units, Liberty Bloom and Liberty Tech, which I’ll talk about more in the next slide.

Now on the right hand side, we’ve deconstructed services and corporate to illustrate how we think about this pillar internally. We see our two services companies, Liberty Bloom and Liberty Tech, as leveraging our group scale and expertise to develop third party opportunities and cost effective solutions to our internal and external customers. We believe both these divisions have significant equity value and should grow over time. 1,300 of the 1,900 employees in Central work for these two services companies. The 600 people in our corporate group provide strategic and operating management and advisory services.

Now this covers a number of areas including key organic and inorganic capital allocation decisions for our telecom growth and services companies, developing and executing key strategic acquisitions and disposals financing and legal support to our public and private debt and equity providers and fundraisings developing senior and junior talents and culture to support our companies and providing specialist technology advice, particularly in fixed and mobile network strategies such as cyber and AI services. We believe that these services add significant value to our portfolio companies. And in many cases, we receive market tested management fees, for example, from Sunrise following its spin. Going forward, we will look to secure appropriate management fees from our companies, whether I’m currently none, particularly in our growth assets, as well as other fully owned companies. And over time, we expect the negative EBITDA associated with this segment to be significantly reduced through this as well as ongoing operating efficiencies.

Turning to a deep dive on Liberty Services, highlighted the value propositions for Bloom and TET, both of which capitalize on long term contracts and talent that we already have at Liberty Global. Liberty Bloom is the newest addition to Liberty Services, leveraging our scale and in house expertise to deliver back office solutions that enhance efficiency, primarily by leveraging technology and scale to reduce costs for customers, notably in financial solutions, particularly around working capital insurance, device financing and energy management products, procurement solutions, including category sourcing, management and tech platforms and business solutions, including finance, HR, legal, tax and construction shared services. We’re already generating over $100,000,000 of revenue here and breaking even on an adjusted EBITDA basis, which includes approximately $15,000,000 of growth investments. Beyond the Liberty Global Federation, key clients include Tesco (OTC:TSCDY), Mobile and Zayo Europe with further building of the customer pipeline to come in 2025. We see an opportunity to grow revenues in Liberty Global’s existing $1,000,000,000 plus back office spend as well as with third parties.

We also see accretive incremental acquisition opportunities to build out our portfolio, for example, in insurance services. At Liberty Tech, we are transforming our cost center to marginal profitability by commercializing our best in class entertainment and connectivity platforms, which already serve over 12,000,000 households across five European markets. This is underpinned by multi year tech services agreements and commercial agreements already in place across Liberty Telecom. While Liberty Tech is generating approximately $450,000,000 of annual revenue and making a positive EBITDA contribution, We are proactively making investments in new areas such as AI, cybersecurity and strategic partnerships to drive further value creation. Turning to guidance for 2025, we’re providing guidance by operating company including free cash flow.

For Virgin Media A2, we expect growing revenues excluding handsets and next fiber construction revenues driven by continued pricing benefits and further next fiber penetration. Growing adjusted EBITDA excluding next fiber construction supported by revenue growth and a step down in the impact of one off OpEx investments that occurred in 2024 stable property and equipment additions of around GBP 2,000,000,000 to GBP 2,200,000,000.0 excluding RoU additions due to continued elevated five gs and fiber to the home spend, notably at fiber up adjusted free cash flow of GBP $350,000,000 to GBP 400,000,000 for the year, which will support cash distributions to shareholders of GBP $350,000,000 to GBP 400,000,000. Now this is lower year on year despite EBITDA growth expectations as we do not expect the same working capital benefit in 2025 as we experienced in 2024. For Vodafone ZIGO, we expect broadly stable revenue growth supported by price indexation in both fixed and mobile, low single digit decline in adjusted EBITDA growth impacted by strategic customer initiatives, UEFA rights and continued impact from collective labor agreements. Property and equipment additions to sales are between 2022% as five gs and CPE investment continues.

Adjusted free cash flow of around EUR 300,000,000 again in 2025, which will support cash distributions to shareholders of around EUR 300,000,000. For Telenet, we expect broadly stable revenues with FMC revenue offsetting the pressure from the standalone mobile segment, a low to mid single digit rebased adjusted EBITDA decline impacted by deferred revenue in 2024 of EUR 17,000,000, which creates a challenging comparison, commercial investment and mandated wage indexations, property and equipment additions of around 38% of revenue, driven by accelerated investment in five gs and digital, which peaks in 2025 whilst wire is ramping up fiber to the home build, where we expect 350,000 Fiber to the Home premises to be passed in 2025. Adjusted free cash flow will be negative €150,000,000 to €180,000,000 given the heavy network CapEx, with wire being debt financed through the new committed CapEx facility. And at corporate, we’re introducing new guidance. Now as you know, historically, we’ve got it to over the past five years on an operating free cash flow basis.

However, we feel it’s time to update this guidance to an EBITDA basis, primarily as we now expect very limited central CapEx going forward. This is because the fact that all our corporate expenses are basically operating expenses. And this is not least because if you look at the services companies like Liberty Tech, we’ve converted CapEx into OpEx through things like the Infosys (NSE:INFY) deal. Going forward, we’re targeting EBITDA for Liberty Services and Corporate to be no more than negative $200,000,000 under our new disclosure. This will be driven by the telecom MSAs such as the one we’ve agreed with Sunrise, as well as increased revenue from third parties for services delivered by Liberty Tech and Liberty Bloom.

We’ll be investing in the growth of our services companies, in particular in AI initiatives by Liberty Tech on behalf of the broader Liberty Telecom assets. We’re targeting up to 10% buyback of shares outstanding for 2025 to further deliver value back to shareholders supported by non core asset disposals during the year. Finally, you will note that our new disclosure now shows Liberty Growth, Privileged Ventures, split out separately for growth assets we fully consolidate such as Formula E, Slovakia and EGG, our home EV charging and energy storage business. It’s worth noting we pick up the equity value for these investments within our Liberty Growth fair market value. And that concludes our prepared remarks for Q4, and I’d like to hand over to the operator for Q and A.

Conference Operator, Liberty Global: The question and answer session will be conducted electronically. Our first question comes from the line of Steve Malcolm with Redburn. Your line is now open.

Steve Malcolm, Analyst, Redburn: Yes, hi there. I hope you can hear me guys. Yes, one question is tricky. I just wanted to sort of a general free cash flow question beyond 2025. I don’t want you to guide on EBITDA beyond this year.

I know you can’t group wise, but it feels like it’s another transition year for Liberty. You’ve had a few that’s where year feels particularly transitional. But as you look into sort of ’twenty six and beyond, maybe just give us a flavor of your outlook for CapEx across the major regions. You talked about Belgium, that’s going to be down. I guess, Ireland will be down as well.

Where we are on five gs CapEx in The UK. Some quite big moving parts on tax as well, obviously, the demand for repatriation tax. On that end, you’ve done a lot of refinancing. Well, the interest cost outlook is beyond 2026. It would be very helpful to get sort of sense of direction of free cash flow beyond this year below the EBITDA light, if you can sort of throw a bit of light on that, that would be very helpful.

Thanks a lot.

Mike Fries, CEO, Liberty Global: Yes. Thanks, Steve. Listen, as I said in my remarks, and by the way, we appreciate you being so patient this morning, but at year end, we have a lot to say. I mentioned that free cash flow, as you’re indicating, is the key metric here that we’re driving towards in every market. I’m not going to go one by one by one, but obviously Charlie showed you in his guidance that we’re generating free cash at VMO2 in Vodafonezigo as we have in the past and as we expect to in the future.

So I think in those two instances clearly with and especially with the netco separation in The UK, we expect that free cash flow is a critical metric for us and one that we anticipate growing. In the case of Belgium and Ireland, I mentioned that Ireland is coming through its CapEx funnel, if you will, and ought to be finished largely in early part of next year with its fiber build and can’t give you the numbers, but obviously we expect that a marginally negative free cash flow figure this year becomes a meaningful free cash flow figure over time. So that trajectory mirrors more of what you’re seeing brought more broadly in European Tempo sector, which is reduced CapEx over time and that should generate free cash flow. So those three assets I think are pretty clear, should be pretty clear. Belgium, a little more complicated because there, we’re still consolidating the netco and that netco has at least EUR 2,000,000,000 in front of it, some of which we finance, some of which are partner financed, some of which will be debt financed.

And what we haven’t yet done there is really engage the market or sell a state to be more blunt about it in the wire asset. There may come a time, will come a time where that is the right move. Wire is arguably going to be the most interesting, attractive infrastructure asset in Europe given what we’re trying to do there with utilization rates at 80% or more in a big chunk of the network. So we fully anticipate that that asset could either be deconsolidated or certainly reflect a value contribution to our value creation narrative that’s substantial and over time reduce the focus on CapEx and really put the attention back on Servco. And the Servco in Belgium has some five gs CapEx, which we’ve discussed and others, but that trajectory also looks positive.

So I think I’m answering your question more indirectly than directly, but I’d say market by market, we absolutely believe the free cash flow trajectory of these businesses looks good. That’s why we’re investing in CapEx. That’s why we’re being creative as to how we invest the CapEx. That’s why we’re establishing netcos in two instances. I think you’re going to like what you see longer term.

Conference Operator, Liberty Global: Thank you for your question, Steve. Our next question comes from the line of Joshua Mills with BNP Paribas (OTC:BNPQY). Your line is now open.

Joshua Mills, Analyst, BNP Paribas: Hi, guys. I’ll use my one question to go into a bit more detail on Slide 14, please. If I understand this right, I think what you’re saying to us is going forward, you want to illustrate the value of the central services business. And part of the way you’re going to do that is by increasing the MSA fees and trying to get more money from the OpCo levels. I guess my question is how do you think about the balance there?

Because on the one hand, yes, you’ll potentially neutralize this negative cash drag, which is clearly a headwind from a valuation perspective. But it’s also going to reduce the EBITDA and the free cash flow out of those businesses, which in some cases are already under pressure. And you’re talking about spinning off or doing IPOs within the next few years. So maybe just a couple of commentaries on how you get that balance right so that you can still get what you deem to be fair value for those businesses when they come to market whilst upstreaming cash in an appropriate way to Liberty would be helpful. And then maybe just part B to that question.

Are we talking here mainly about the businesses within your 100% ownership? Or have you had the conversations with Telefonica (NYSE:TEF) at VM02 and Vodafone at Vodafone Zico that they should be paying you more effectively from the JV level up to Liberty because of the services you provide? Thanks.

Charlie, CFO, Liberty Global: Mike, are you there?

Mike Fries, CEO, Liberty Global: Sorry, I was on mute. That was a great question, Josh. I’m going to let Charlie address most of it. I just want to say quickly upfront that while we definitely mentioned MSAs at the outset as to a source of net corporate spend reduction, there is an additional source which is of course just simply reducing costs. And I would not be surprised if we take a good hard look at the operating model and the expenses and size and scale of the corporate group at the same time.

So it’s not simply laying off costs to opcos as you point out who are already having their own issues and quite frankly which we want to maximize the value of. It’s also rethinking the operating model as we move forward. So you should expect both things to occur. Charlie, you want to address the MSA question?

Mike Fries, CEO, Liberty Global: Yes. So I think, some ways it’s

: a good test case. What services make sense to scale and where we have expertise that is expensive to replicate at the OpCos and what doesn’t. And I’m not going to go through each of the key levers I’ve tried in my remarks to do that. But I’ll give you an example, treasury would be a good example. Right along the weekend we have a very, very good treasury who are well experienced on managing debt facilities and bank balance sheets.

And they just, for example, did actually a very good refinancing for Sunrise since its spin, which materially reduced the cost of its capital and extended its average life. Now it doesn’t make sense for Sunrise to build its own treasury for less regular transactions and also they’d find it hard to replicate the level of expertise we have.

Charlie, CFO, Liberty Global: So in getting that balance right, that is the kind

: of thing we’re trying to get right. I think it’s also worth pointing out that we have obviously charged these companies for many years MSAs, but they’ve always been below the EBITDA line. So there’s nothing new going on here. What we’re now when we spin them is making explicit what proportion

Charlie, CFO, Liberty Global: of that should be above the line. And just to confirm, what

: I’m talking about here is specifically related to those corporate advisory services. Liberty Tech and indeed Liberty Bloom are genuine arm’s length businesses, where they win or lose according to third party contracts. And in the case, for example, of Zayo, we were competitive enough to win from a third party and the same thing applies with each of these opcodes.

Mike Fries, CEO, Liberty Global: On your question around JVs, we do collect management fees, MSA fees from VM02 that was established at the outset along with Teff. And Charlie is working very hard on our growth portfolio where we are providing meaningful services to controlled and minority owned positions there. So, this isn’t an extraction exercise. This is a value creation exercise, but it’s also ensuring that the extraordinary value we think we provide is being properly recognized. But also as I’ll repeat, we’ll look at the operating model as well.

This is not just offsetting, this is going to be rethinking the operating model as the shape of the business changes.

Conference Operator, Liberty Global: Thank you for your question, Joshua. Our next question comes from the line of Karl Murdock Smith with Citigroup (NYSE:C). Your line is now open.

Joshua Mills, Analyst, BNP Paribas: That’s great. Thanks very much.

Charlie, CFO, Liberty Global: I’ll ask the

Joshua Mills, Analyst, BNP Paribas: A shares versus C shares question please regarding the buyback. Just an update on how you’re thinking around that. All of the buyback last year I think was done on the C line, despite it being more expensive and now having lower liquidity than the A shares. So I was just wondering on what your thoughts are around the buyback going forward and in terms of which line to do it on? Thank you.

Mike Fries, CEO, Liberty Global: Yes. Thanks, Carl. Listen, I think we are we do this on a relatively dynamic basis. So I don’t know that we have at this very moment a grid we’re willing to disclose. I will say we haven’t been buying any stock through the course of this year.

We did not have a 10b5-one plan in place at year end. So through February 19, we haven’t bought a single share, but we anticipate obviously doing that. And as you’ll see what we do as time goes by as we disclose it, but I’m not going to give you the expectation at this point.

Conference Operator, Liberty Global: Thank you for your question, Carl. Our next question comes from the line of Matthew Harrigan with The Benchmark Company. Your line is now open.

Carl Murdock Smith, Analyst, Citigroup: Thank you. There is a sense at CES this year and some other forms that you get acceleration in the handset replacement cycle. Right now, it’s about four years. It’s been the longest it’s ever been. Some of that could be prompted by AI functionality of the phones beyond the facial recognition and transcription.

Maybe it’s better integrated. So you have to fumble around with an app. How do you think an increase in switching activity on the high end of the market could affect your mobile operations in The UK and Benelux, what are the opportunities there and would you expect to gain share if that finally happened? Obviously, everyone on this call is well aware that five gs in Europe has substantially lagged that in The U. S, but it does feel like it could be an interesting propellant for your business.

Thanks for taking the question.

Mike Fries, CEO, Liberty Global: Thanks, Matt. Lutz, you want to address that in The UK?

Joshua Mills, Analyst, BNP Paribas: Yes.

Mike Fries, CEO, Liberty Global: You might be on mute.

Lutz, UK Operations Lead, Liberty Global: Can you hear me?

Mike Fries, CEO, Liberty Global: Hello? Yes.

Lutz, UK Operations Lead, Liberty Global: Yes. Okay. So as you rightly point out, Matt, right, O2 has really the majority of premium customers. So we are the home of iPhone and also we have recently launched the flagship innovation from Samsung (KS:005930). But with all of it, we don’t see any acceleration based on AI on these demand for these kind of phones yet.

So therefore, we are very cautious factoring this in the future. I mean, if your forecast is right, it’s upside, but it’s not really in our guidance. So we don’t see that. But I agree with your question and hopefully, you’re right.

Conference Operator, Liberty Global: Thank you for your question, Matthew. Our next question comes from the line of Orest Glass with Bernstein Societe Generale (OTC:SCGLY) Group. Your line is now open.

Orest Glass, Analyst, Bernstein Societe Generale Group: Thank you very much. Thank you so much. I have clarification questions on The UK. What was the nature of that working capital benefit in the fourth quarter that’s now weighing in a way sort of on the year on year trends for free cash flow? And also what is the nature of these Prostate NatHets in terms of the acquisition ARPU?

I think you mentioned GiffGaff as a particular driver, which suggests that this could be ARPU dilutive, this recovery of the NetAds. And if I may, just to clarify, one thing that was left open in the guidance was the next fiber impact, which has been either way in the past. I mean, how do you actually expect that to unfold in 2025 in The UK? Thank you so much.

Mike Fries, CEO, Liberty Global: Thanks. Charlie, you want to take the working capital question and maybe the next fiber question and then Lutz, you can handle the postpaid ARPU.

Charlie, CFO, Liberty Global: Yes. So on the working capital, just

: to remind you, we try we believe telecom companies run their working capital broadly flat because our customer cycle, broader the customer pays us real time and to the extent to which your costs stay flat, you broadly have a payable cycle that doesn’t really finance. Now within that, there are obviously seasonal variations. Q4 variation makes a big difference. And we do do some optimization of it, for example, around realizing a much lower cost of capital by what they call factoring receivables. We do handset receivables as many people do.

And in the case of our payables, we try and take the pressure off our suppliers by doing what’s called vendor financing, which I think we’ve talked about over the years. I would characterize the 2024 swing as within broadly flat because it’s

Charlie, CFO, Liberty Global: a big company, $10,000,000,000

: of revenue, but it was slightly positive there. And I think what we’ve suggested in 2025 is that we are just reverting back to a pure flat number. And to be honest with

Charlie, CFO, Liberty Global: you, the only certainty is

: it will be plus or minus around that. It could be a bit more positive if it could be slightly negative. And it will depend a lot on the seasonal nature and also the timing of certain CapEx, etcetera. Do you want to take the

Mike Fries, CEO, Liberty Global: Next fiber on guidance, Charlie?

Charlie, CFO, Liberty Global: So what was the question

: on Next Fiber? Because I beg your pardon.

Lutz, UK Operations Lead, Liberty Global: I can do this. I mean, we are not guiding NextFiber. Yes, so maybe then I start with NextFiber question. I mean, as you know, we are not publicly differentiating in our net debt growth between our existing coverage and Next Fiber. So therefore, you get the blended number.

I think underlying, of course, it shouldn’t be a surprise for you that in the BAU coverage, we are losing customers, small amount, but we are losing it. And in Next Fiber, we are growing because we are penetrating a new network. Now what I can tell you is that our losses in our existing coverage are significant less to other big market players. This is what we believe. But aggressive ordnance, yes, with very aggressive prices are getting some customers also away from us.

The question is, for your models, what do you factor in? How long will this last? How sustainable is this? On the postpaid question, so first, I think it’s very important to understand that we’ve taken a conscious decision to approach the market in postpaid, so in pay monthly with two brands, O2 and GiftGuff. So therefore, deliberately, we are not lowering prices or not too much because this is our premium brand.

And if we are going in acquisition too aggressive, we also would offer that to our existing base. So therefore, there are two markets we are playing in, the classical MNO market, this is O2, and here we look clearly more after ARPU than after volume. GiftGulf is the volume brand. Here, we look more after volume and less after ARPU. And if you edit those up, you can see on Page eight of the deck that the postpaid ARPU in Q4 has been shrinking minus 6%, but the a year ago, it was a tough comparator.

And as you know, we are doing the price rise in Q1, and I think you know the level of price rise we are doing. So we have a much less tough previous year comparator out of price rise last year, and the price rises are quite interesting for us. So therefore, going forward, we are pretty confident that, right, ultimately what we are interested in is to grow mobile service revenue out of P times Q out of both brands, and we are confident in them.

Mike Fries, CEO, Liberty Global: Thanks, Luis.

Conference Operator, Liberty Global: Thank you for your question, Ulrich. Our next question comes from the line of David Wright with Bank of America. Your line is now open.

Mike Fries, CEO, Liberty Global0: Thank you. And thank you for taking my calls. I’m just going to come back to Slide six, your sum of the parts walk, which I think there’s an element of there’s a lot of debate around this, of course, if only the fact that obviously the market is not agreeing and thus your derivation of the undervalued assets. I guess my question is, is U. K.

Related, but as a derivative of this, which is you talk about there being zero equity value for the telecom assets. But obviously, what we are observing in telecom, I think we know very clearly is that the infrastructure assets are valued at a much higher multiple than the Circa assets. So if you do go down the route in The UK or in Belgium of selling off infrastructure within the NetCos or Wire or whoever it may be, is it not the case that the value of the mix of the telecom asset will be on a lower EBITDA multiple because you’ve got less infrastructure and more Servco. And that’s coming to I guess my key question here is what potential equity

Conference Operator, Liberty Global: Thank you for your question.

Steve Malcolm, Analyst, Redburn: Did we lose you?

Mike Fries, CEO, Liberty Global: Well, sorry, we lost the last little bit of your question, David, but I’ll try to riff off of what I think you’re getting at. Look, there’s lots of ways of answering that. I would say number one, whether it’s one turn on the integrated EBITDA or it’s three turns on the netco and half a turn on the serveco, there’s no question that we’re trading at the value of our debt. And that’s where Sunrise was trading as well as an integrated operator. If you look at the telco average across Europe, which is a mix of Netco Servco’s integrated companies at 6.5%, does it seem extraordinary to us to think that getting people to appreciate the value of our infrastructure, the value of our free cash flow potential over time is worthy of a higher multiple.

And by the way, I’m not going to wait around for you to get there. Meaning, if the market doesn’t appreciate it, we’ll just have to prove it. And that’s really the difference. The strategic pivot twelve months ago was we ain’t waiting around anymore for you to figure it out. We’re just going to prove it.

And we did that with Sunrise. So to me, it’s not a question of will it or won’t it. We’ll demonstrate that it’s there. We’ll show you with transactions, with strategic opportunities that it’s there. And people who stick around will get the benefit of it.

I mean, we certainly want research analysts, yourself included, to see the value in what we’re doing. We want you to appreciate the free cash flow potential of our businesses. We want you to understand the network infrastructure strategies. That’s no question. But we know that over time, a combination of these things will absolutely be reflected in the value of these telecom businesses.

And that if I went to my partners, if I went to an investment bank to list something, if I went to a private equity shop to sell it, they’re not giving me zero. All right. They’re not giving me zero. So the fact that we think it’s zero, I think is the starting point and we can debate whether it’s one turn, two turns, three turns, whether it’s free cash flow dividend yield strategy or network infrastructure premium multiple strategy or a combination of all of those. But we’re convinced that over this twenty four to thirty six month timeframe, we’re going to demonstrate that.

And that is what you have to believe to buy this stock. That’s the bottom line. Whether you get there or other analysts get there, I don’t really care. We’re going to get there and it will be delivered through external independent transactions or opportunities as opposed to analytical research. But Dave, we didn’t get the end part of your question, but I hope that’s responsive.

Conference Operator, Liberty Global: Thank you for your question, David. Our final question comes from the line of James Ratzer with New Street Research. Your line is now open.

Mike Fries, CEO, Liberty Global1: Yes, Mike, good morning. Thanks very much for taking the question. So the area I was interested in focusing on today, please, was just the spectrum position that you have in The U. K. Asset with Virgin Media.

So obviously with the Vodafone three transaction, they build a pretty dominant spectrum position, but to offset that, you will be buying some spectrum from them to strengthen your own position. So I was wondering if you can give us some more insight into the moving parts here. Can you let us know, for example, how much spectrum you will be purchasing? Can you give us some steer on what the cost of that will be?

Steve Malcolm, Analyst, Redburn: Will we see the cost

Mike Fries, CEO, Liberty Global1: of that in 2025? Or is it going to be phased in over a few years? And then with this new spectrum position, how secure do you feel about, for example, the Sky MVNO on your network and whether they could be lured across with a stronger spectrum position at Vodafone three? When does that contract with Sky next come up for renewal? Thank you.

Mike Fries, CEO, Liberty Global: Yes, lots of really good questions there. I’ll let Lutz dig in. I don’t believe we disclosed much in the way of detail, Lutz, on price and megahertz spectrum and the bands we’re buying, but I’ll let you address that as well as the Sky contract length.

Lutz, UK Operations Lead, Liberty Global: Yes, thank you. Yes, James, as Mike said, right, we can’t really disclose neither the concrete spectrum nor the price. The deal is also not closed on Vodafone three yet. I think the spectrum will be disclosed by Ofcom, if I’m not mistaken, after the deal has been closed. And also to share with you the price, we need agreement from our partners there.

So unfortunately, we cannot say that. I think what I can say is, you know that our market share is significantly higher today compared to the spectrum we hold, and we fix that with this kind of deal. So we put ourselves in a healthy position. I also don’t want and I’m not allowed to disclose with you the term of the deal with Sky. But what I can tell you is that the spectrum we are sitting on, the investments we are doing in our mobile network, we have done, especially in 2024, which was significantly higher and we will do going forward, puts us in the position to really stay in a long term relationship with Sky.

Mike Fries, CEO, Liberty Global: Thanks, Lutz. I think that’s time. Operator, was there one more?

Conference Operator, Liberty Global: No, sir. That concludes today’s question and answer session.

Mike Fries, CEO, Liberty Global: I

Conference Operator, Liberty Global: would now like to pass the call back to Mr. Fryes.

Mike Fries, CEO, Liberty Global: Ed Fries, yes. Thanks, everybody. And David, sorry to get animated on your question. I didn’t get the end part of it. So I hope we were responsive.

But listen, I appreciate you joining us a little longer remarks today, but I think appropriate given year end. And as far as we’re concerned, we think 2024 was a standout year. We hit 13 to 14 guidance metrics on Sunrise and more or less achieve all the strategic goals. And we’re setting ourselves up for an equally ambitious 2025 and beyond. So, we feel like this is nothing but upside here and of course the buyback will help us benefit from that and you hopefully over time.

So we’re excited about where we’re heading and we always appreciate your questions and your support and you know where to find us. So thanks everybody.

Conference Operator, Liberty Global: Ladies and gentlemen, this concludes Liberty Global’s fourth quarter twenty twenty four investor call. As a reminder, a replay of the call will be available in the Investor Relations section of Liberty Global’s website. You can also find a copy of today’s presentation materials. Thank you and have a wonderful day.

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