Liberty Latin America: Record for Puerto Rico
SAN JUAN — Telecom parent company Liberty Latin America Ltd. announced Wednesday its financial and operating results for the second quarter of 2020 and six months (YTD, or H1) ended June 30.
Liberty Latin America operates in more than 20 countries in Latin America and the Caribbean under the consumer brands VTR, Flow, Liberty, Más Móvil, BTC, UTS and Cabletica.
The company said its performance was impacted by COVID-19, but was improving from an April low.
Liberty Puerto Rico delivered “another strong quarter” according to the earnings release, which listed the following:
- Record RGU additions of 34,000 in Q2 driven by 22,000 broadband additions as demand increased for access to our high-speed network.
- Reported and rebased revenue growth of 5% was driven by broadband subscriber additions, reflecting the strength of our networks and entertainment propositions.
- New build / upgrade activity added over 5,000 homes
Liberty Puerto Rico RGU, or subscriber, growth was driven by “47,000 broadband adds; Liberty Puerto Rico reported a record quarter with 20,000 customer additions, approximately five times the prior-year period’s additions,” the company’s release reads.
“As anticipated, following a strong start to the year, the second quarter brought with it a number of COVID-19 related challenges for many of our operations, resulting in declining year-over-year top-line performance,” CEO Balan Nair said in Liberty’s earnings release. “The good news is that we planned extensively and were able to offset some of the impacts through early cost management actions. As we look to the rest of the year, our mobile and B2B businesses are expected to see further challenges, however we believe we are past the low point. We continue to be focused on generating positive free cash flow in 2020, and took a step towards that with our strong Q2 performance.
“In terms of our reporting segments, Puerto Rico led with another tremendous quarter, reporting record RGU additions and we are looking forward to adding AT&T’s assets in Puerto Rico and the US Virgin Islands to further enhance our customer proposition and prospects. VTR and Cabletica also added subscribers in the period, albeit seeing more of an impact from lockdown restrictions in Chile. C&W experienced the greatest headwinds with declining RGUs driven by Panama where we experienced the most restrictive lockdowns across all of our markets. From a product perspective, consumers continue to demand high-speed connectivity and our fixed-line services have been particularly resilient.
“Last week, we announced the exciting news that we agreed to acquire Telefónica’s Costa Rica business. We have had great success in Costa Rica with our cable operation Cabletica and are increasing our investment in the country through a complementary, fast-growing, and postpaid-weighted mobile business. The two businesses combined would create a leading full-service communications player with approximately $400 million of revenue. This transaction comes at an attractive valuation, consistent with our disciplined approach towards M&A.
“As part of the financing for our acquisition of Telefónica Costa Rica as well as looking to other potential opportunities across our strong pipeline, we announced a $350 million rights offering today, with all the members of our Board and my leadership team having expressed their intention to subscribe. We feel this is an appropriate step to ensure we have flexibility to participate in accretive M&A opportunities, while maintaining a prudent capital structure.
“Overall there continues to be uncertainty due to COVID-19, however our operating and financial performance has been improving since a trough in April, and we anticipate further progress over the remainder of 2020. Looking further ahead, cash generation remains our focus. This should be bolstered by organic performance, as we drive growth and efficiency in the business, benefiting from targeted network and product investments, in addition to disciplined acquisition activity.”
See the full release at www.lla.com.