European cable operator Liberty Global reported fourth-quarter organic growth in line with its full-year outlook and said it expects a similar rate of growth in 2018. Quarterly revenue growth was its strongest in the year, led by UK operator Virgin Media, its biggest unit.
Fourth-quarter revenues rose 2.9 percent year-on-year on a rebased basis to USD 3.988 billion, leading to growth of 2.3 percent over the full year. The company benefited from growth in the mobile and business markets, which helped offset fewer TV subscribers.
Operating cash flow on the same basis rose 4.3 percent to USD 1.912 billion in Q4, resulting in annual growth of 4.5 percent. Liberty Global said it expects rebased OCF to again grow around 5 percent in 2018, while adjusted free cash flow is forecast stable at USD 1.6 billion.
Customer growth slowed to 149,200 fixed RGUs added in Q4, down from over 272,000 a year ago. TV customer losses were more than 7x higher at 54,500, led by losses at Telenet in Belgium and the Switzerland and Austria unit. Liberty did better in the mobile market, with net additions of 95,300 in the quarter, as both Telenet and Virgin Media turned to positive growth.
Liberty said it reached 7.7 million customers using its advanced video platforms (Horizon and Tivo) by year-end, after 210,000 net additions in Q4. That's equal to 43 percent of its cable video base. The same percentage of broadband customers had its new WiFi Connect Box, up by 1 million in Q4 to over 6.4 million subscribers.
On a reported basis, Liberty Global's quarterly results were lower, due to the deconsolidation of its Netherlands business and negative forex effects. Operating profit fell 27 percent to USD 496 million in Q4, and the net result turned to a loss of USD 992 million.
The company ended the year with cash of USD 1.7 billion and available credit of USD 3.2 billion. Net debt was at 4.9x earnings.
Liberty Global said it expects to increase spending on property and equipment additions in 2018 to around USD 5.1 billion from USD 4.8 billion in 2017. That includes USD 2.1 billion for expanding and upgrading its network footprint, up from USD 1.2 billion last year. In 2017, the network passed 1.1 million additional premises, to reach a total of over 45.2 million.
