Earnings call transcript Q4 2022

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Operator

Hello and welcome to the Liberty Broadband 2022 Yearend Earnings Call.

During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded, February 17.

I would now like to turn the call over to Shane Kleinstein, Vice President, Investor Relations. Shane. ahead, go Please

Shane Kleinstein

morning. Good

events begin, and including call we'd of everyone we Forms by of XXXX. to Private due filed differ to XX-K a TripAdvisor mentioned like certain forward-looking in with this number the Actual of includes Act meaning and Litigation that results statements SEC. could Securities materially Liberty uncertainties, Before risks Reform remind Broadband or those within the recent Liberty the most

as of Liberty events, to only or expectations date on of TripAdvisor which These disclaim conditions and or reflect speak forward-looking any herein, based. in change or any Liberty such updates contained the this call, statement with Liberty disseminate Broadband expressly forward-looking or statements revisions to TripAdvisor's any Liberty thereto and is undertaking any Broadband in obligation or statements regard circumstances any to change any

discuss Broadband, metrics, Information financial and earnings call, non-GAAP measures the on as X we today's Schedules with X required Liberty prior issued along for the which available will regarding periods, including definitions release found as and today, and for preliminary On earnings in be reconciliations, releases well Broadband's OIBDA. note certain comparable Liberty adjusted can are including press GAAP website.

to President like and CEO. introduce Liberty's I'd Greg Maffei, Now,

Greg Maffei

to Pete we to Chief available we'll and and Also during Financial GCI; Officer, questions. Principal Good questions morning. Ron will answers be CFO Thank Liberty have CEO questions available TripAdvisor. you, answer -- Shane. will Today also of speaking Accounting answer will Liberty Brian on the of Q&A, related call, be Broadband's; to we Duncan, GCI, Wendling; Pounds,

Liberty me Broadband. with Let start

approximately the in we liabilities. began mentioned flow the to near-term address XX% in September, from we the call sales charter As of our cash last retaining

prices. related billion exchangeables based by due October $X.X that on approximately charter the is to current have We

charter Charter to on sales the Liberty The we received million $XXX million and January, was from them, on $XXX about first through mismatch versus spend the repurchases repurchased they to spent the Broadband when of $XXX under for charter and Therefore, than on that price that of we of slightly account those this from come just may more we -- proceeds proceeds year. of only about a and the when $XXX slight November the repurchases. current being There's end of look timing XX%. [ph]

lower XXXX. do expect do towards to XX% sales We are we forward, Similar of from early purchases. from Liberty year, driven plan XX% Going grants. proceeds total last to also annual continue the year, by the the to in in Charter compensation this Broadband year ownership to be we proceeds Charter's apply Charter cap share fully-load under

goes the are we to at previously discuss a do company, But bit. more they as from and heard forward, the the expect investments due buybacks Charter at year XXXX and to compared lighter them, making will I

will revisit in the after We addressed. are maturities year our debt capital later allocation

Charter. So XXXX. unit We had in broadband at lower let's growth look

is doubt. pull a no Some of this COVID forward,

them competitor do has and fixed them a though taker, competition like been a and note ourselves, term. the entrants, term market not expander was fewer chances that long share get it wireless. a as for customer fewer will in wireless the we with cases, the of move share many taker would Some opportunities not we we over from lower fixed feel short to in sales Though view increased environment at a including new surely

drive recorded added, mobile product broadband and the is Spectrum had units sequential Nonetheless, net Charter XXX,XXX in improvement One, quarter, a the and were fourth mobile, pricing our strong residential operating momentum posted over we XX,XXX cable quarters. results. prior helping note, was we some other quarter, global In two record to has and fourth the adds. third quarter. Charter's I the net was in share of rather, net in of adds been mobile fourth mobile a huge compared in success XX% operators. all XX% It quarter would adds the And new --

of is of all a the net a Charter So which number. adds, mobile stunning nearly was quarter

the believe cost of to We and connectivity. bundling through seamless value this demonstrates savings customers

As Chris December, high plan product so Winfrey initiatives of our is in and growth undertaking a outlined differentiated series accelerating opportunities. network attack That converged evolution to large connectivity Charter through accelerate includes split has far like returns offerings rural a above our think X high way builds, mid which we we IRRs. teens penetration are to and attractive targeting in Spectrum build, and initial with expectations

both to investments By in will the Chris percent yield extensions be percent the excluding Winfrey with CapEx cash marketplace and of and increase below positive long XXXX, free vehicle. working he's CapEx declined revenue, relationship the by excited do here both a but strategy, with have the of investments the and in business, as his that flow offer in Liberty had that and revenue. a as the attractive Broadband XX% are line further, to articulated even in the Charter a stock we board Liberty growth expect price, these interim, a increase

of I 'XX free investments yield flow Charter the look Broadband despite it's is was cash cash Broadband. more would Liberty XX.X%. even yield note about free and X.X% X.X% through their compelling Liberty relative value -- The flow

year the TripAdvisor. the XXXX expectations. number the Full of to recovery now Trip hotel XXX% [ph] fourth the was throughout accelerated turn quarter recovery XXXX The in the XX% travel quarter, The of continued reached model actually number. exceeding revenue year. and management's me Let fourth

US XXXX, degree. driving I'm revenue, and less to going is from margins hotel obviously about hitting both and free from in with revenue to that a more In in reach talk traffic and paid strength which second. are volumes, our meta the pricing more in XXXX parity a with we collection,

would marketing XXX% quarter the the reduce up was [ph] that Viator losses in fourth despite over increased prior spend. year the

in confident see and customers, in repeat continue the are experienced and improved to this of We conversion segment. we growth benefits very

XXXX opportunities margins flat cost strategic in investment through including segments, product increased the they would using enhancements and to to expect maintain I on disciplined allocation growth. focused despite management experiences. long-term is growth drive Management in our and note

over Brian discuss to it the financials. to And with I'll that, turn

Brian Wendling

held morning, good indemnification had based Broadband a was million stock. Note equivalents and of of and everybody. charter $XX as of excludes shares of billion. our cash The includes investment Liberty Greg, of At you, February XX quarter debt had $XXX share principal and our Charter and billion. at quarter end, Broadband cash directly amount At value Liberty this consolidated of $X.X preferred $XX.X that at million, the cash obligation yesterday's which on Thank price close end, GCI. total

Charter commentary in XXXX. Charter we Greg's reiterate share proceeds the part of to early that I'll expect sales from reduced

X% sell, However, tax X%. do to XX% for shares 'XX our are previous we annual X% our to the updating guidance for of we rate to to compared guidance

The range the booked the minimum dividend tax Act. high Reduction the assumes under does end the updated deduction, apply not DRD, for sales received Inflation to share of Charter

accruing are additional higher in a We the the for 'XX, is from pending. IRA rate while guidance and tax Treasury IRS

So is this year. we clarification believe possible

any the for of book paid tax us. in to tax carry minimum exceeds note extent this for a to income making forward will 'XX future tax timing more offset regular the BMC, impact I'd that years regular income

as there Reduction Act. of the and not are beyond certain cadence are share many pricing our aspects and Charter guidance control, tax Inflation repurchases around We including providing 'XX variables outside clarification specific of

Liberty with that the GCI; adjusted record Looking XXXX the flow quarter. for is dividends be an contract $XXX to $XX dividends third roaming year. headwinds year-over-year also the solid Liberty GCI comparisons year great Broadband Broadband and year-to-date in at additional this company 'XX, distributed despite will dividends paid paid GCI million free of OIBDA, from impacted million additional we to generated during in cash far year. a so the through and anticipate

up quarter, $XXX the driven was revenue grew primarily XXXX, through which we negative the company's highest and X% entered adjusted OIBDA that roaming was and adjusted was in the revenue data X%, was ARPU also strong by of comparisons the up data drove positive long third to agreement growth. full both the by from million, impact as OIBDA, this ever into and is XX%. For created of as the which 'XX that year, In QX subscriber growth demand, lapping quarter This OIBDA flat well adjusted driven year. fourth term

consumer X,XXX results quality continues customers wireless the improve in of completion XXXX. to with the fiber network The capacity Dutch continued growth led wireless X,XXX the consumer The subscribers XG deleverage. added to in the build modem GCI Operationally, operating Harbor. and and of network, cable increased satellite strength to

credit at the its GCI's as For in $XX GCI times year-end million has X.X million. capacity on the $XXX agreement defined full debt revolver. was year, net undrawn declined Leverage and

hybrid spend fiber fiber In of the state proceeds and XXXX, $XXX primarily Dutch expenditures. to the grant wireless to net million capital This GCI received from project. and federal net improvements CapEx on was related spent funding. Harbor networks is

approximately critical in government middle [indiscernible] fiber due 'XX, which be in continued $XXX projects, investments rural be securing necessary which view including million, and mile project. Alaska, connectivity Rural to we connectivity to Net proactive with expansion CapEx in taking last the We're for expect should approach AU-Aleutians high-returning a the funding. network to additional elevated the we as

And with that, back over the Greg. to call I'll turn

Greg Maffei

in that, operator, listening open the the like audience, continued your I'd for questions. appreciate Thank And Brian. Liberty and you, Liberty interest we line To with TripAdvisor. to Broadband

Operator

question from [Operator James from is coming today first Ratcliffe Instructions] ISI. Our Evercore

live. line now is Your

James Ratcliffe

could. I if two, Greg,

does -- place it or cash to works remains additional to? First Delaware raising any over the XX.X% that buyback, at in cap of would be and board XX% litigation you whether flexibility you you're settling you moment, all, regarding Charter the Charter selling the but to the if time can creating open give around

assuming pay exchangeable October. are those -- mentioned terms consider factors about in put? should the are And down, or you how you Thanks. the fact they refi in them of to secondly, we talk that in putable considering that Can

Greg Maffei

color second. I'll our James. hand handle first the it the Oren, I'll to and some you Treasurer, on to one, Thanks, give Ben

So think on the first, you're right. I

up that Charter, can settlement have ideas with litigation note about opportunities the does to and us for open had that. more discussions preliminary some we've fruitful You

And taking given high-returning to the in is us. Charter less in be shareholders, able assets, in basis, be than Liberty and by to the we more other would table, that business nonetheless, investing raising they less by XX% XX% are to the that investments relative because increased and would than that that off on many cap. go a would open We will the in think many buybacks, productive down do we buyback goes a XXXX, bit, quite the or positive our ameliorate the

get do So could that done, is in Ben? done do. we'd XXXX, think it to and like that I are optimistic we something get something might

Ben Oren

to amount we are meaningful the charter respect With of you're a cash. accruing exchangeable, right,

Charter to this cash with some to margin is slight and accessing those a probably option prefer address with we preference that point exchangeable, new maintain optimal would we have of loan I think related that the say combination to hand between a exchangeable a what shares Charter at the probably Charter have we on liquidity. potentially exchangeable and we'd margin new loan

Operator

from coming is question Doug Mitchelson next Suisse. from Our Credit

Your line is now live.

Doug Mitchelson

was for to beat. X% the looking sure but levered just right high think, returns, the -- had EBITDA and growth EBITDA for look, ask equity I I and Charter is growth that Charters not this, curious year single-digit way with hard Street quite to this was

was buyback riskless CapEx. curious outlook look is for at as Charter point. versus investing on relatively buying through I investing investment for this So just they're mid-to-high that which back It's in as your stock more returns you, interesting versus an we

interesting Broadband It's a shareholders. from a perspective long-term Liberty dynamic an versus Charter

are my you as Liberty looking ago? -- were question the about few for years returns terms you a for guess forward? Broadband of And investment ultimately, you an algorithm is, from I excited Charter as what's So Charter in

Greg Maffei

A you, couple Thank think. of points, Doug. I

on yes, We'll network, were those upgrades we all million the little agree. all We'll on that's existing doing a attractive First, relatively stipulate. business, -- when capital; the dam two additions look, existing with okay?

existing initiatives still the have are attractive rural really business a a is split on we network people but bid give very the think we a federal making broadband got of attractive investments to more at attractive pushed be on we're that runway the capital us the I high they're set return what enthused about think, higher many something and market set quite Liberty and incremental fulfil, broadband state bidding and actually than cases, endorsed The on And then made and investments level, which, with local the to in lot are by led these up, going the IRRs. RDOF as build-outs and the whole attractive not governments basis. board up well as to do We the very government spend process, of these doing. as are

we're So about enthused them.

we Holding are isn't offensive they're And buyback for interesting, to out go is long we defensive investments, but over worthwhile comparing that to making on the going long and probably these the the attractive yes, are the away. term Charter. haul, we buyback basis opportunity for but and and an think

remain issues I enthused we're have how and back to kind -- equity. a back which to So much buying effectively we're some prospects, do these through basis is to deciding on quite that, issue Charter's and about buy that of we're around all our attacking or the Liberty exchangeable, given remains future take current own way likely some we have going fact basis the of other going the is though continued indication

Doug Mitchelson

in not Do mid-single-digit too you see distant the Charter returning high EBITDA single-digit growth future? to or

Greg Maffei

Yes.

Operator

Stanley. Morgan next question is coming Our today Ben Swinburne from from

Ben Swinburne

on a guess little I up Charter. Doug's question around following bit

favorable a for slower, obviously is are than there were, an a a is for see given some has growth are capital scenario Rates guys there today years. quite there's higher the the off XX That's leverage. scenario, where over John's financial than that be up. bit obviously intensity optimal it? last you but Do think should months? they're -- many I'm been sure is stock you approach around leverage it higher Charter actually they Is running lower You come level

somewhat which seemingly was about [ph] if FCC got on you're strong on of And you about views she's a was of kind curious Gigi or things on have implications But in that that unrelated a market short becoming lot happen Charter. may any from guys are cable. although tied broadband be I soon to the something just then if Chairperson, curious order. you the Obviously, any is topic, I I'd front? watching in perspective concerned thinking

Greg Maffei

markets, be the the on reason that. particular, might enthused not that where front, are Charter Look, We're more in leverage environment public handle there's think leverage, no markets about buying I more to are but an in it push Ben. equity Thanks, so people not can today, up. leverage,

but you is very You're it's any getting if cost, that refinanced only the has, look Charter little, period. right to note at which increased about floating in debt of or stack really

given our increase floating. actual borrowing minimis, much So existing or is the rolled in is versus is cost net relatively much de how getting how

are to don't think the than I a said, I higher, case I these businesses could think very lower fearful. you make think I for think I stable. it's are harder for a case as other make -- capital markets

And We the but costs not would the -- and have a half to you're very sophisticated increased investment, finance and program, stock it of is right note the I'm was. with increased worried about environment increased the leverage. note what I

attractive work it's you pretty still my that all So in at view.

Ben Oren

me that earlier in And on regulatory, since growth business risk existing tell the always during present has successfully. has about regulation point 'XXs, been its with second say, administration the an could a regulatory but cable regulatory the maybe [ph] he early activist I cable went environment relatively risk earlier, a would time the it, right, ever but I've II Title the Obama around navigated spent certainly, been that We we real through the from risk. John

it's unlikely there what and broadband see that is and more I market but we COVID Washington, than more think always in now. and many vigilant aggressive do less out the are voices about constantly I done attractiveness through things a think the would free that, extending had that and industry something that we job are of are aggressive [ph] which great building that

risk at risk, it I it's don't an ever a So over time. increased that period we've certainly as seen a look of while

Ben Swinburne

lining actual CapEx help still wireless in might investments context? this Yes. fixed an and least in silver rural be And the at should certainly,

Greg Maffei

that are -- both comments, good think Ben. those I

Operator

is Barton coming Next Crockett Securities. question from from Rosenblatt

Barton Crockett

looking Yes, ask seem could. Okay. volatility wireless is I'd in One year. them. like some if just to the two subs are on I questions, we to They GCI, have at after

on just what's numbers with I explain Can think you quarter. down it going wireless subscriber the this was there?

Greg Maffei

take counterparts. our Ron, you first I'll that offer could but Pete? want it or shot, we up to Well, to Alaskan a answer do

Ron Duncan

been wireless both prepaid was and the a and for our the strong with we've seasonality. off of postpaid what fishing the XX summer there in prepaid we're number those the in in months this an with fall to quarters. up consecutive having There's a overall and very due communities industry prepaid you're fall There's sales to year, subs, in then then decrease problems some to platform. volatility business, think due seeing the I on surge

We're almost right stabilize been working that platform postpaid the the got continue last -- uniformly best continue make and on far the we on three and the which will measure has core of our competitive, believe to We've up is the in now that, network, XG Alaska. the side, it success best to improving grow. wireless really but years, more and will for network away

you ranked always data factor helping the three, or is with of by we the and high-speed comparisons, plus two If products postpaid bundling look at speed the often number a that test one sales.

Barton Crockett

break can guys prepaid you Do you -- mix? the . postpaid down and

Ron Duncan

I we, those publish Pete? numbers. we that Do don't know

Pete Pounds

No.

Barton Crockett

team for Then All here interest but which sides a I call, topic. can -- moving equity bankruptcy type positioning of on the noticing is through distributor we to around was as these in and through -- both this interest Okay. have some maybe interesting and the thought cost cable this switching a and sports a at their come be industry for big I networks towards speculation you on payment right. Charter and missed I'm you they're an RSN a news a considered little of big with just to bit. different owner that an Diamond, very as programming they've of guys different a opportunity -- source we some think, acknowledged of flow the complex Greg, and you they've that Braves and presents,

talk is what cost there the think companies? opportunity Is like cable the likely revenues to present play if out? a of reduction to for Braves? this wondering was risk sports I an just programming you in some you about could teams the Does for

Greg Maffei

a question. Barton, Well, hydro good It's there. multiheaded

is well and baseball at situation -- I recall, try to MLP the been think looking an you closely with aligned Diamond attractive may and complicated. very I as think best And the ways it it in as situation make we've quite for investment.

first, public, But costs. can Charter it I see that. I you'll on a That's less costs attractive can, down RSN but will Charter, That's time, think in just continually it's Charter renew the renews and just for inevitable. And putting relative those see on I over will but as reductions you had, Charter go carriage don't suspect continue to reductions. terms best basis. on think

largest On we from -- dozen the the than of reasons, RSNs. lot very the is Braves everything engaged the Dodgers, cases a including Braves the or fact the know a RSN for understanding attractive, a are relatively compared My have RSN. they looking a profitable from we certainly that of broadband logical territory, a a side, more modest, to have Diamond, from we the base very their relatively modest payments fee most and believe

Diamond, there RSN will even unlikely take that we speculated event happen my to So version for some long but in the successor is owned probably them. a their a or has Diamond attractive takes all bankruptcy because would things, the of RSNs filing as it's in something they by profitable a of will it contract Diamond is think there our be that accept renegotiate reject not a over speculation. or slim-down them very What term, are not maybe been doesn't be will that suspect I by a

Barton Crockett

to bringing ownership opportunity there's leagues or MLB, of and you're mentioned take Do else You you for think an the maybe? RSNs something rights the aligned. the do

Greg Maffei

just we'll more I -- it's is I see, opportunity Barton. speculation said, but some leagues that, think the for look than complicated. there honestly, to at, Speculating it's as

Barton Crockett

it. I appreciate that, Well, all Okay. you Thank for Greg.

Operator

Michael coming from question Rollins Citi. Our today from is final

Michael Rollins

year you Greg, after capital that your give consideration you Liberty you the us would earlier a later upcoming the of you in get in maturity. for through preview set Can the mentioned Broadband? allocation call revisit

given then moment. there's could characteristics quantification amount the will for share and to evolve Charter, And of you if at is both how this curious expectation secondly, around and just program meaningful the defined if of potentially some your program seen GCI has how it the for a and been ACP that funding

Greg Maffei

I the the point, think through Broadband financing, we'll look -- but price charter long Liberty what of to our with on first is, weigh, the more term, that of what probably prices, using we'll those likely stock at stock quite taxes if if our get discount, all we the -- there's the factors cash it's back once -- flow. XXX% there's be around possible clarity buying and will more free the

Broadband Free stock. here basically from back buy that to Liberty we'll get repurchased for cash flow we using what defined be is Charter, that

the think I that's most likely case.

it, On during the question COVID clearly, attractive that we on you and as one Ron of help that reasons comment as I'll saw an well. program of ACP, let why the

One the seen of we debt, debt. broadband why declines think our such in growth reasons bad the a during reasons adds. adds, one see net such I units, COVID in saw the we we've of -- broadband It's why of

keeping of are see done. the of it's what see what D.C. program. They're So Ron, We'll in going an on. them track We'll gets There I X all much you this funding is. been a add? attractive how think lot funding the might

Ron Duncan

I that primary got the material qualify material for think of it's a debt particularly benefit. at less we've been last GCI In of percent has revenue And tribal but absurdly to subs ACP tenths than levels. X.X%. year Alaska. the for a number XX,XXX, we number of of in were of an six almost total norm by We bad benefited a such bad versus run industry our low subs. a norm debt We've pre-COVID X.X% and And Alaska, reason

making subscriber off of on taking good base ordinarily the turn stable a $XX think it's doing And end month. getting them our that and is and we're lowest it's I customers. So would what

ACP in that program go projecting of more we the That our to current house, Republicans control said, think it's the environment and bad we're sometime return early in 'XX in the to with of unknown, because political to levels necessary funding out it's actual to it away the of in is runs on unlikely debt benefits normal be first the depends when money provided half that would the of It continue but the date termination likely expenditure of and the ongoing rate. program 'XX.

Greg Maffei

done. for and that, soon. So Thank I not with to Broadband. interest think Liberty your operator, you very you next we're much We quarter in to Trip both talking Liberty forward look if

Operator

does Thank and teleconference webcast. you. That conclude today's

your disconnect participation. time, may You for line We have this you day. wonderful at thank and your a

Liberty Broadband (LBRDP) 17 Feb 232022 Q4 Earnings call transcript