Liberty Global reported another small drop in underlying sales and EBITDA in the third quarter, hurt by the effects of the pandemic. Nevertheless, the company maintained its full-year guidance for growth in adjusted free cash flow, supported by strong growth in the broadband market and a growing FMC penetration in the customer base.
The group added a net 37,600 customer relationships in the quarter, reversing a decline of 18,000 in Q3 2019. The company said this was its best quarterly performance since Q1 2017. The growth came mainly in the UK at Virgin Media (+37,300), along with the CEE operations (+8,600), while Belgium (-3,100) and Switzerland (-6,300) lost customers.
Cable ARPU was still down 0.9 percent on an organic basis to USD 60.37, and mobile ARPU fell 6.5 percent to USD 17.04. Total RGUs declined by 79,800 to 24.80 million, with a loss of 57,300 TV customers and 93,000 fewer fixed telephony users.
Liberty Global said it added over 70,000 broadband customers in Q3, its best result in over three years. It also gained 127,000 postpaid mobile customers, helping FMC penetration increase to 25 percent of customers across the group. The company sees room for growth to around 40 percent, similar to the levels achieved already in Belgium and the Netherlands.
Total revenues rose 4.0 percent to USD 2.95 billion in Q3, but were down 1.3 percent on an organic basis. Sales were hurt by lower advertising at the TV businesses in Ireland and Belgium and continued difficulties at UPC Switzerland. Liberty Global said it expects to close the takeover of Sunrise in Switzerland in mid-November, after acquiring over 96 percent of shares in the public offer.
Adjusted EBITDA of USD 1.21 billion fell 0.2 percent on a reported basis and dropped 5.0 percent after adjusting for currency effects and scope, in line with the full-year outlook for a mid single-digit drop. The company ended the period with a loss from continuing operations of USD 973.6 million versus a profit of USD 587.2 million a year ago.
Capex was largely stable at USD 656 million, as was OFCF at USD 551.5 million. With an improved financing cash flow, the group's adjusted free cash flow reached USD 403 million compared to a negative USD 48 million a year earlier. Liberty Global said its balance sheet remained solid, with USD 9.3 billion in available liquidity and net leverage of 4.0x.
