Liberty Global reported second-quarter sales up 25 percent year-on-year to USD 3.16 billion. Its takeover of Virgin Media in the UK contributed around two-thirds of the increase, and Liberty said it already sees synergies from the takeover turning out higher than initially estimated.
The company's organic growth was 4 percent in Q2, including 5 percent growth in Western Europe, a flat performance in Eastern Europe and 9 percent growth in Chile thanks to expansion in mobile services. The cable operator saw a slowdown in customer growth in the period, with 191,000 revenue-generating units added on an organic basis compared to 364,000 a year ago. This was due to a slowdown in Germany and East Europe and tough competition in the Netherlands, where it lost customers.
Operating cash flow was up 21 percent to USD 1.45 billion and grew 3 percent on an organic basis, while operating profit fell 7 percent to USD 445 million, hurt by charges and increased depreciation related to the Virgin takeover. This resulted in a net loss of USD 12 million or USD 0.04 per share, versus a profit of USD 702 million or USD 2.60 per share a year ago, when the company booked a gain on selling its Australian assets.
The cable operator increased capex slightly in the quarter to USD 490 million or 16 percent of revenues and said it was using vendor financing and capital leasing more to fund the investments. Free cash flow was still up 29 percent to USD 193 million in Q2. While debt increased substantially in the quarter on the Virgin takeover, Liberty still had USD 2.1 billion in cash and said it would continue its share repurchase programme.
