ATUS - Earnings call transcript Q1 2018

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Operator

Good afternoon. My name is Tim, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Altice USA First Quarter 2018 Results Conference Call. [Operator Instructions]. Mr. Investor may of your Head Brown, Relations, begin you conference. Nick

Nick Brown

through In Thank Charlie, I'll you then you everyone. a take who presentation, questions. we'll for take and Hello, Dexter joining. moment, and to hand would the over

forward-looking presentation to on next the available disclaimer please today's over will the pleasure website, company's it's And and X. As with Goei. of statements, slides be this for Page call The read Altice to USA's month. that, contain may Dexter hand are the on a replay my available CEO,

Dexter Goei

you, it flow. particularly quarter don't EBITDA our the event quarter. would growth on in Good services. end straight as growth with - limited call, Residential the X.X%, dispute subscriber the quarter, Thank disrupting sorry, Slide Nick. just presentation on quarter I growth cash Starz and afternoon, X% and everyone, was relatively very And delayed X.X% a headwinds we grew why second into limited the , earnings revenue in until on of with Optimum we subfield as we with was and growth X. in was QX, In said free jump operating mentioned one-off at be the of the last last multiple year-end nor'easters snowstorms, from rate end at

well, investments with by the Business Altice reflecting enterprise particularly growth supporting an last solid event. revenue, a SMB subscribers USA, video overall Services in the months. have Residential Suddenlink impacted very basis, rate Suddenlink We video a strengthened saw up delay trends losses in fundamental However, X.X%, trending and several made of in for also more on improvement both at we

new multiscreen flow cost-efficiency strong growing year-over-year aX. by still further business, with improve and integrated is targeted And realization, a into strongly generation in seeing free we supported business capabilities, cash margins as to which Advertising continued was audience deleveraging. investment our Our are

in footprint. One, effective announced are of seen at lastly, with Suddenlink the has Optimum, from Altice entertainment new service be a Altice and expected June launch XXXX. early we the starting And to just new only platform, Our is successful USA spin-off this

just have for Dutch finalize Altice We the next to now week the and approval AFM N.V. are approvals regulatory XXth the for of before shareholder the waiting split everything. received vote U.S. on May

Turning components of revenue growth. to breakdown the Slide X. show We of a total

delay event. Our the impacted with which QX, business, mentioned, of revenue, just I Optimum, multiple X.X% Residential is Starz XX% year-over-year by over rate total of as a and the dispute, grew storms in

the decent of - delay digits where in Suddenlink growing our on saw business Business Starz with the revenue is at mid-single in Optimum. dispute. customer though slower QX. headwinds improved we capitalized X.X% the remains still event growth, X.X% driver, offsetting Services growth the also trends was through revenue in during by rate at up here. meant Advertising All being disruption with blackout a X.X% more And other slightly although is areas at supported customer this competitive providers growth

customer we growth stable X.X%. in how shows of residential the ARPU been with - X, Slide have to revenue seen base overall of Moving residential X.X% contributing to growth QX, year-over-year

$XXX.XX. and new X,XXX, innovative We Optimum, and speed broadband to Altice BXC And relationship services at ARPU residential loss unique on focused saw experience. offsetting remained USA higher customer net at of QX, in tiers total Suddenlink still service the Specifically, small improvements residential with additions strategy growth One network through a overall with Altice and upgrade, is further ARPU simplification. customer growing drive our of

our Residential a This trends. RGU is X. Moving on to of Slide summary

pricing, in year you of issues, trends Altice QX, net better weather USA's Suddenlink see which overall performance Altice than introduced driven Optimum, We're this marketing, area. can left, added last Viacom content more us more the losses in by in pleased really launch much should back the were better On better make in QX. of localized since at this One, video and we XX,XXX Suddenlink and spite the competitive top see, Starz most including to focused doing even pay-TV with before

again, the On less can growth XX,XXX left, XXXX showed the QX XX,XXX you bottom as had in net see additions QX slower QX the - additions getting X,XXX who XXXX, Starz Optimum, we at broadband saw the the video customers we this in the we're broadband you below X. to in next XXXX, due weren't and able the One Slide with as in service connect storms. dispute during can Optimum across to during sold slide, good many and traction bundle footprint, on launched January Altice fully see

Moving Slide entertainment and with One Wi-Fi, is control. Recall, TV, phone including an streaming platform our box, all-in-one on to integrated Altice absolute remote X. XK Internet, new voice-activated service,

XX% connected video of already, over Altice our the ARPU. taking are customers at add We at $XX launched XXX,XXX we least milestone One additions have gross higher which gross achievement is first with Over video now Optimum. since

launch And We feature soft apps to have confirm new we have choices, that us and now and QX. and launch Suddenlink, footprint at continually QX across great we'll enables improving features expand during our and feedback the its performance.

XX% the of repeaters improved Wi-Fi most more as key of used than One through X being router of OTT adoption by a much Netflix Wi-Fi power its X daily. home. the as voice customers Wi-Fi have and our X Altice as One seeing XX% base We are antenna watched advanced as watt seen well And experience a mini it has around base. the It's apps. such installed with initial of features using Altice one is high control, by providing

the will performance Smart further by launch will of frequency customers which take optimize later dynamically. Wi-Fi, year this We this with allocating to

decent Business This strengthened summary Slide like includes Carrier growth of to our X.X% by Services of quarter with the verticals. as Carrier Business Moving and Overall, SMB fiber-to-the-tower in up to large products. we connectivity, revenue & customer growth have own our X, services delay grew position. higher-speed was such we a with more in network in hosted boosted though wins Services in slower services event Education and plus slightly year-over-year X.X%, and is division. voice Enterprise sell-in QX, segment, a while competitive see rate at tiers with a X%, continue core advantage

We growth CapEx division the are network products the and to allocating Business services. new Services of portfolio to expand and

as want the speeds. quality Moving as on to our broadband we We the boosting offer broadband X. to Slide on focus improving of well highlight service

taken on we've the footprint. whole First, This the transmitters, has as USA receive footprint were amplifiers, we nodes upgrades XX% the made of upgrade the hybrid of digitalization as the and our to such Suddenlink specifically CMTS upgrading limiting our lasers, able that Altice involved active speed of across coverage and equipment of speeds. well legacy initial Suddenlink service left, up megabit to speeds. to XXX including to fiber/coax being the Altice with XX% This footprint disruptions has network, X some summarized availability and the USA over causing as footprint, gig plant

improvements and for IP One to are We which to interface deliver network And delivery, agnostic upgrade In to This it expand CPE words, the upgrade same has video. on wireless to X unicast availability we of QAM allows QAM technology this optimal will transition, continuous for Altice is enable the as offered cable get continue our in networks, as reducing the IP forward. legacy anticipation efficiencies. multiscreen video, is will over multicast additional gig it way access consumers. us video and network. IP allowing been enabled user high-quality In both major or other fixed the whether initiated video. and go cost benefits transition it's for service our as linear of and have IP we devices can nonlinear But network cost well

without with right, the that reminder the and be while the the new and on a between FTTH we still will on On losing time of is services networks native out which innovative can delivery, industry continuing where more this of half they all-IP bridge products coexist. services This trending, new FTTH IP the available that expected legacy be will we're advantages video of both so first which is in that FTTH with gap and second an commercialization develop build, has networks the strategy is the our year. fiber architecture,

Page differentiate our XX, to a are couple and approach. Moving investment we over highlight other to of able we think areas we our where

First agreement on, MVNO we the full have with signed Sprint.

has support Sprint's with core And Sprint's investment network specification, begun IT into service. USA's Our benefit which we to MVNO and microsites development Altice connecting will Wi-Fi are platforms. network networks to our

we to cost be growth of We area new to peers. are customers bundle expand confident a compared to offer allowing the us will our services very economic at this us of

one in of integration efficiencies. way flexibility and processes. which this give BSS a streamlining It the and in target system aX OSS of we left, XX, fully next-generation bill business, customers, further simplification allow billing more enable and platform. back-end result new On advertising our cost and will serve on we is the outline, our integrated will us platforms, the the Page Regarding for

devices. digital and national into across a single targeting Place TV including of acquisitions integrated a the Audience multiple Audience and advertising have We reach with Media, buy, Partners

and have and will customer more an expand way order to customized to model allow them This repeat our to introduced in which purchases solution us base unique allows a We clients. online self-serve easily. automated a tailored advertisers and for our offer

analytics recently, Interconnect data so robust News New this as and York success monitor QX, customers of growth was We includes can and the content which attribution, our business with business. the in saw service this launched enhanced have Advertising X.X% as their well We which really new business, campaigns. aX

the XX have I'll have of the review. as And growth We which Charlie for News this there. business to part over N.V., now, prospects with good financial adds see acquired and we news hand Altice split iXX local

Charles Stewart

everyone. Thanks, Dexter, hello, and

this in USA's the CPE that Altice more well you Margin flow is of at the to quarter footprint. XX%, back Looking deployment where we while capitalization the at EBITDA our had total programming see of of boxes less Altice fourth year-over-year progression, ahead in adjusted called really our say we margin the USA's a set-top One adding as as that in EBITDA XX%. here expense quarter were the the launch of of operating year-over-year, refurbished were Suddenlink less as unit Optimum margin, increased was video possible. the we're going EBITDA cash hard by XX.X% The high guiding contain certainly content Starz, single-digit to you expansion to that we're in free increases slide can fighting at saw margin still with margins Progression, Altice from as for impacted margin with summarize driven forward although, EBITDA Viacom here as X.X% QX much customer quarter as we expect CapEx, and

unified new billing organization, to now which increase for just simplifying We to and with on growth and maintaining should examples all continue allow the system, some margins while as the sales new as focus further mentioned investment upgrades areas network marketing. our in the the Dexter well and

CapEx, pace Slide existing was our as rollout an addressable build, year-over-year, plant was increased our that Suddenlink One quarter, cash the new here still CPE - primarily our overall of We expect budget. I of and of would Page basis. just very we higher ramp driven on network which fiber overview accrued But our XX to cost Turning do related the a Altice our by home expansion although extends given Suddenlink in see On as shows as in through well note our it spend, well especially that to on have we CapEx as Altice I'd cash at XXXX at as new an disciplined One which network and our plant there. line you build our the CapEx remain to our fiber market do - to mentioned. an built rollout. year-over-year present basis, network we CapEx increase the

timing activities be our next include third restructuring the and investing quarters growth we they'll of debt noting M&A, between small lower are so $X.X should expected means of up $XXX very of Recall, $X cash cash earn-out It's interest quarter, to in buybacks $XXX In to Partners quarter, flow in cash XXXX, see Financing that which in in $XX million cash the had underlying immediately we a the authorization share following quarters here by million XXXX. dividend slide, payments, worth approximately pay this flow. quarter. of a in Audience $X the Other of was through and normally costs which, payment. which reform, cash all that the to the of you we mostly the We due million fourth on accelerate higher the first of show our we includes here growth flow does change for cash million to that generated second free left, case, of that prior to free $XXX expect significant coupon first of can rebate the view million. Turning to costs. the remainder USA a cash tax free activities spin-off the have Altice is raised to tax with be remember until June. taxpayer spin-off. in Altice not reflects the USA we billion the following that the And and billion cash for revenue in

on starting the reported the see of quarter EBITDA Altice returns. free shareholder approximately XX, the a leverage acquisition. On of Slide come for further closed first and X.Xx basis growth, could cash right, Xx a USA's we deleveraging rapidly point we from as Optimum from as have on So LTM we further has when see to you down flow opportunities

additional first as just the of referenced which fund likely was pro as leverage X.Xx, that Optimum. from upcoming partially well financing hand dividend, end forma to the at on were With billion the $X.X at at from Suddenlink I quarter cash the

to Our we're potential the pace our Xx, repurchases. intend of leverage including given very with any be to share year of cash the and growth, by remains comfortable even X.X range flow end within which this target we

position We of the our have liquidity weighted debt $X.X dividend, a of pro strong X.X%. cost forma average for current around and of billion

our the show billion again, This debt activity. weighted Turning is dividend our to And on our a Slide $X.X profile. is, and for of maturity average forma refinancing we pro basis, this years. recent life summary XX, of debt X.X

Optimum free implemented we spin-off from generation. our $X.X XX, Suddenlink activity Slide revolving covered of We accounting at XXXX, which thought major the flow the it changes are no have our maturities cash would until some at other as as helpful summarize related and impacts our the well we've and to billion facility by as be GAAP of maturities corporate credit near-term On first quarter. recent as financial well the as

and to Firstly, as our N.V. a as USA the which from Altice recombination network business well in of Technical only on achieve is and this de minimis year, Altice cost. - savings us Services establishing the the quarter left, that second efficiency at Altice This process acquired of ATS allowed a US recall we last drive separated has build.

costs productivity also gains in activity profile and organization. they're for cost further are our scale build [indiscernible] we So advantage delivering than our as focused We before, as this see fiber ATS a lower add on competitive and our area through us. the

network, the iXX, due expanding an which is the to international on current XXXX modest news of affairs terms generate would currently if been we're of EBITDA the to or fully million and cash flow then. higher rapidly. business, expected U.S. basis setup a XXXX in had the business loss consolidated cash in impact, the operating less impact, have of financial Then In EBITDA $X CapEx, transfer free we

at our XX iXX and more and also Mediacom, this there's In wanted prospects to USA, business added excited business News growth have Altice about acquire Charter We as local next $XX there. the carriage of to our news elimination we and come just when as the it combine the to to with we're month. partially cost is The area. the offset of be fee Altice the that be in will management content paid split annual N.V. will I've million - mentioned, time effective by addition

right, impact standard the GAAP the we've On the changes. accounting of summarized

has revenue first two recognition primary relates standards, to change, The XXX, effects. which ASC

change cost the that a of has basis. but historical is XXXX effect a nonservice negative revenue million has XXXX-XX of accounting side, revenue which get It to is back the the bundled And reclassification for second which XXXX on positive Optimum, pension at a gift total on does cost And we million. historical our - impact lastly, in EBITDA. revenue, total purchase no $XX neutral relates a the change the on so on product product it's of $XX to with a some of splits then the EBITDA revenue but impact reallocation ASU The first discount. has incentive,

final Turning medium-term our for revenue to to Altice X% we to USA expect around here, total XXXX we're X.X% growth our for iterating the XXXX. guidance slide, compared which and of outlook,

mean a the quarter further to year. mid-term - year more So been is political also But elections point as will will given comparison This the rate advertising first prove of have be low events. proved we timing second we in favorable well, the expected. half this get likely to weighted a as more the

and we're Altice processes. Nick term, more cash expand XXXX. I'll lastly, regulatory the to our CapEx, but flow going due to USA's back current EBITDA guidance turn $X.X to this And further specific billion for give and Over be medium at adjusted for to profit annual XXXX can we're we long around unable And expect with time it we still to that, Q&A. our to over believe margins,

Nick Brown

lines, Please the Yes. open operator.

Operator

[Operator Instructions].

the question with line first comes of Phil Morgan. Cusick from Your JP

Philip Cusick

at the First, how you the come reports get procedurally, shareholder think the should your how X% we that consumer the about second, base. past And approval? quickly fundamentally, and on And talk across about have or next of spin? into coming Can then will consumer that event the business timing the spaces? month you once about in the rate vote, so the and what's Dutch timing

Dexter Goei

Sure, Phil.

the the On it's we I will next But be weeks will - the which think to that first think after shareholder AFM vote, don't Friday EGM. it. one, in Dutch we're at exactly when the know respond X circa

if the approves. AFM - So

timing, on a weren't of precise closing we we nor terms thinking is the view so what that's nor but a have the think have I dividend as of June, on ex in on AFM date approval, to do the don't when in we date U.S. the dividend full So spin on that's the kind why we're about still cash

more a not the June, everything the So become over But timing We we we're hopefully should today, those speaking, clear in know, the - just days hopeful. happens. when is. lot what will there. is next precision be early on week, the roughly It

you're the of terms rate In event, correct.

side. on as have with the X% rate we of will a depending event XX-day That well. filtering into be have just We BXC month the whole over our June have clients. BXB event the We notification rate on do

a mostly it, be will - it coming the then this let's So bit and year. full quarter quarter in a in of call June, June, half little in third of

Operator

line question next the Bazinet Citigroup. comes from Your of Jason with

Jason Bazinet

had sort something quick question MVNO. on just you I Sprint of - and closing everything something, up Sprint Sprint? If Or just agreement of it or Sprint relates or there's T-Mobile, your there sort a between unchanged option as transaction exit some an some with your the is to asked? asked ends is that

Dexter Goei

use to No, benefit if And in Obviously, would the things would don't roaming of that would have of from that could the irrespective benefit But closing T-Mo the no. think it any answers you, I happen for don't agreement from positive the the incremental we to, we merger. we be Jason. want has we with one clearly, transaction. of Sprint

will it positive. So but I be expectation's as that, usual, is if anything, business think it net

Operator

with from comes the Research. of Your Jonathan Street next New question line Chaplin

Jonathan Chaplin

the get what's would prepared process assuming Wi-Fi of to where that Just of little And detail CBC you be Wi-Fi as a get integration footprint the you remarks in with Jason's the infrastructure more the into you thought bit that in question. of the could to that, required guys give and some the you the mentioned wondering with Sprint. robust deployment, I'm how in relationship. follow-up on augment investment on to more - sort us in if required. would in I'm are out Sprint I've having certainly most always insight - love just among most conjunction a

Dexter Goei

of we about you've who peers has as traffic. seamless expect on how you've is correctly not outflow Yes, much traffic. if And been, some similar, Jonathan. higher, levels offloading of the the One Wi-Fi outflow This points our side. seen said there's that of two traffic have the from all there, publicly noted

improvement to get increase for network that's more anticipate traffic as sure the where Wi-Fi as mobile. So coming And trying well on obviously, really we network Wi-Fi the that the we the make throughput is. throughout in

the network we to would their probably In let's where are where when it the thought Sprint, terms on we're signed of have relative of side, of call be ahead we densification we we MVNO we agreement. -

at I over a the better think we Sprint ourselves goodwill deliver of best existing helping to amongst let most product that over can and at a tremendous there's Sprint our before alone deliver amount and launch, to we network colleagues friends dense to their customers. our

on well, say, core both we are our deployment So provider so well I IT there, Wi-Fi capabilities ahead the improving as we with core for offload. side. the densification, And signed on as our significantly stage a up network side in on would already as have the network

full more we ahead last the launching Sprint year. said next in So that I we here, intended. the quarter, think no first of goal quarter And in would pun was, be

Operator

from comes MoffettNathanson. question of line from Craig next Your Moffett the

Craig Moffett

could. the a more requiring technical see I this I obviously, And you've seen now including philosophical just upgrades, lot the plant where amplifiers you that replacing now much does fiber - in EBITDA to transmission a questions, can of is, reductions business? how broader EBITDA in I'm confident upgrades sustainable still that itself having slowed under - are the much made plant fiber in come Does of the if question, your do do already made? you've just growth one, make EBITDA need, guess, a growth pretty bit. quite the - a guess, to gotten the about having a drop, the I medium - think wondering two rates in? have growth which availability. talked you you done get where XG I'm and you just that then having how as manage cost You've, that And business? And can you this One the belt, you

Dexter Goei

as right, relatively I storm. Well, on in that we deliver announced think, seeing we've Optimum, asked the side, thought is, clearly, Craig, questions, we're years, first we've by the a and quarter, on X.X interlinked, maybe event years. issues delivered Starz you growth the in EBITDA driven synergies, rate clear think X really somewhat slowdown years, couple I X which the been of OpEx delivered to But anyhow over and we two last quarters, could and our we which in two

about Now project-related And continuing top business. grow line it's obviously, drive take to the growth, EBITDA not more and but margin advantage efficiencies. of the gross our only to operating leverage in

I we towards this interface. this think targeting one hybrid to the a will USA of our not relating where point Altice will this our single our flexibility will business integration shape on able drive a in This or will us under first integration a and have more system. end single will which billing BSS/OSS to any key platform in be customer drive big platform, the to projects, significant year, the be go being a and happen full year, synergies us of in billing to a allow form, lot allow we

transition from able I about a better away to best-in-class secondly, gig is efficiencies where implement footprint sense and on HFC right? time. anticipate is a makes the current both projects and network to we're think HFC homes and size to an an Optimum not be to to then we economic estate-related, footprint, it as forward, customer of large it different the going goal - over network driven interfacing depending of relating by the ahead. we to over Suddenlink and terms services But lot continuously the business, entire selective upgrades, in standpoint the of the out G&A-related. multiple of CapEx speeds real populations other the more But than our that FTTH also there clusters. across roll of then better key will amount of go X network broadband projects, coax for that is work only the side drive desire But FTTH larger OpEx big our sorry, pockets your have, in plant one passed be continued FTTH are from what on will applied or much we that FTTH point over much So under an

Craig Moffett

you it has make fiber than in to like plant I been what the in most what feeder done understand, of Just sure the said actual sounds though, you've so but drops. from far rather

right? haven't really that You so started in earnest? that And is

Dexter Goei

homes about year. get numbers. just a of in quarter decent dropped launch scale haven't already. commercial to We probably the we've - No, which We'll effectively this third been before into of public We're we the amount be product, will to looking get a

Operator

with comes Kannan question from next of Your the line Venkateshwar Barclays Capital.

Kannan Venkateshwar

couple. a Just

it in cost you First on the that'll of be if in impact of had Starz the any to product, with that that it the update are about well system, impact that helpful. if roughly your terms can And some quantify as terms impact is dispute, that impact Charlie the was. of of if think going of the in adds you when Altice targets then what the what storm, could respect you for give us it as can also, may you us quantify of what And deep so or and into terms Dexter, very in net have One rollout had the how quarter.

Dexter Goei

pinpoint our impacted broadly if the It's of the at and and terms I the Sure. a interlinked. specifically. centers call Optimum storm-related call two year storms. versus impacts the related the of you overall specifically, there little what went a think quarter normal a from flow is to gross moved negative websites, We it And of above probably to know is and mean, secondly is thousand clear speaking the it's also storms, and impacted the the whether last reduced don't Starz-related that storms. just just allocate because between several higher that is number, but mind and on away one that Starz first as differences do look Starz or our quantity listen, than incoming of that, as and I our in we've our relating churned specifically both in that you effect And other quarter are published gross primarily. and they customer net to people adds it that was volumes the FiOS the there. adds, is Starz number One lack inquiries first to difficult impact the to to in connectivity relating adds churn marketing year, between of the you the this impact right? the into which know bit the of has - So are somewhat Starz

a in on I think the to numbers Starz, I think in [indiscernible] publicly. talk about that position we're don't terms of

you an We've I to moved distribute them great attractive customers. is deal we on. We've all say is we very our partner. think think a continue in product, their incentivized transaction place, that with which got both with we're where and our liked much by can - got to we push

a adds. this but our that standpoint, longer the net was the on on through right - from go our for effect structure, term we So but did our by the compounded onetime was weather gross impact adds and cost by to decision decision drive bad

Kannan Venkateshwar

you All us? And on help right. One, Altice could

Dexter Goei

that the with the The Optimum has our we've the on home Altice footprint. our today, to basis. on equipment most may a shortfall Altice of XXX,XXX One, of of a, gross to listen, quality customers time do the really connected video adds got are XX% have. the One daily customers XX%

sets related You'd are, whether older how televisions be no be or they'd HDMI connection. there on SD surprised many

they customers goal be of Those WE have the their front So consistently to The there the are home here who foot. are we're migrating cannot clients as amounts proactively to we're asking who have today Altice clusters. been to upgrade certain migrating basis certain for One is migrating certain them started our well. it, on receive until also equipment. it, and proactively customer and

the into little has So days. obviously, It just in has four great. it upgrade about had the the We which is, this experience, but also not normal. ever months middleware, been launch is features feedback January. launched of early looking is we've a stability only the we The We're new in still the been my in it. in There, system, of but continuously that best over a are to regularly. box, bugs

So that first the And that a now much January in Optimum better continue across in Suddenlink it footprint. that which Suddenlink in has The footprint, we're at of the third the second which quality different homogenous obviously, are Optimum to reason as been goes gets the acquisitions footprint, pace Suddenlink it getting quarter and on will is, used. roll different than and our was the of and product terms on many the architectures are up throughout was footprint, a customers launched technologies footprint. equipment the they network relative pretty why getting there

Operator

next line with comes the from of Deutsche Bank. Your Bryan Kraft question

Bryan Kraft

questions. two had I

lot a is, N.V. supply but concerned flood hitting to investors getting spin the the that shareholders about Europe in down I selling due market stock of a after obviously, their to some delever are before sheet the First, with repurchases, shares. of understand shares share already. the balance you U.S. aggressive want

weakness have that. to the Just willingness repurchase further a by to I is authorization curious to take after as work. advantage putting what of And then your follow-up your share spin after

Dexter Goei

on Sure. Bryan, I our maintain right? every looks intentions. be right? How today a peers to cheap stand-alone be, that comment at Xx if there any can single, metric can much this about stage an the at out navigate to we allocation, by basis we our is valuation year-end relative flexibility mean, think as our there as metric think I like look on keep think will leverage we'll annual we USA here Altice in it's you targeting view to that's thoughtful I relative ratio. So get I our capital quite we'll X.X the about, you - it - think standpoint, probably, is to are to

I themselves to know of much shareholders when think given liability the answer I ahead already would spin how in U.S. of flowback lot you the been that There's has view tax positioned I on because volatility that's crystallized. as date, our don't that stock. mentioned, ex-dividend the a people comment the effectively, a get of think, have for that, there

themselves So are people already of that. ahead positioning

the of think NV those the what lot already see we'll a the I smart out But this. will been to which time. date, stocks and correlate, between there's there how in start happening, at and - Altice less that forward point anticipate after date of these things was different flow the weird than the ex-dividend and on and just understand back machinations we're because I'm looking independently, happens enough split we very stock trading as and till because themselves potentially, ex-dividend actually positioned of the be ahead So to not may trading all people USA

Bryan Kraft

debt-to-EBITDA. year could following the just repurchases that X.Xx billion this think X I that year Dexter, end do at the we is you still net share by up of reasonable? And in Do you math that. mean, estimate on and end

Dexter Goei

to love on our can't about comment limitations on that, but our profitability based I'd XXXX here. we talk Well, regulatory

being to talk guidance of this to I we do about if be really profitability at then So that publish torturous the we've things and is quarter. kind weren't our that quarter matrices, cute last side we got would It on our N.V.'s that. think

we and the So delay could process.

So than smarter than I you're a lot am. that I think

math I'm to that you're works your about the right So out numbers sure mentioning.

Bryan Kraft

Okay. is return levels? that's generating? the to to passed expect that XQ clean And my Optimum and after broadband what's the to a you about footprint Have seen sub churn disruption of the trans talk be Starz representative you can the getting happened And healthy company last capable of growth quarter would more then you nor'easters? in trends just is, the gross question

Dexter Goei

Yes.

trends, and second of both Suddenlink Our side. so year-over-year have improved, March and they're both kind of on on customer RGU half a in on the Optimum numbers starting up, basis the and

Operator

from with comes question line James next the Ratcliffe Evercore. of Your

James Ratcliffe

if Two, could. I

to you what the the additional an secondly, to costs and of FTTH higher launching year you First programming the brings are product, you? impact on to in cling do later of mentioned the had somewhat much the Starz that the network give a differentiating your going by traditional And you services broadband it of topic. benefit? quarter with coax delivered speeds how think Can that us and terms all, about idea versus I'm in this product how in opportunities beyond presumably the

Dexter Goei

thought what the probably felt an ultimately X months I and don't about we at to And the being way, we're our contract. privacy by one, of ended extract as to then don't good if I first gone comment I Needless a we think say, think attractive at the offered would've given was we on think they liberty didn't think transaction. exercise through our up that over well. I where Starz partners

can So talk much we that's as probably about. as

programming over the costs up in think our quarter. just X% I

position, in think above I of the on think, So weight weight to exclusive programmers. basis York New the on our we us allows are because a the relative growth sector punching our our punch to I DMA, our costs really here on programming the above of, size

the that not FTTH, there. we not again, the On are saying product here. to We're wheel a trying necessarily differentiated that so we out reinvent is have

the We are business. much where interfacing the self-install self-install better where have would our side on a will the to preparing of include which the fiber experience, on us to seamless example, go up, reduce network better lot for allow where CapEx of and not customer to maintenance requirements and really world OpEx speeds our as customer our be on ourselves want a continue we a if an self-install,

it's going even Mi be I year, think moving X we're slightly we NG-PONX, to be type we'll start ourselves anymore speeds, won't today, rollout Mi speeds, higher. next that if But FTTH as setting relative believe, be as which higher we be to I delivering into HFC. delivering speeds X maybe up to going of clear not, to

James Ratcliffe

Are just they're gigabit XXX-megabit could, the follow-up, in to difference a done a the upgrade XXX- areas you files speeds performance where area? Verizon I seeing competitively to still in where if speed And question. has the in on versus

Dexter Goei

issue of is of coming a through we the mindshare, through question a specific product. mean, by and People - sites more see buy our right? driven I centers our are e-commerce call lot a here desire our that for

adds because churning may X-gig that's they FiOS available. where the go toy product in we mindshare so It's people don't from limited a gross aggressive our area where us them off the about And product on away it's the of of move at to town. in when are the products to coming more to X-gig marketing see new the a to

which on so And of or we're we FTTH mindful shares we FiOS focused X-gig upgrades on product. on that, the the have seeing a is the But our network as market they well Starz though when footprint. the in changes any as of have that areas rollout why is are product material excluding we're not Optimum effect, normalized behavior customer any in even HFC

Operator

Ryvicker comes Your with of Marci from next question Fargo. line the Wells

Marci Ryvicker

we've at the rewarding to about to do flow, you're back I levering other to because know not stocks like lower appreciate take was did Bryan might What the companies your buy And you does - not be more to talking a what about, confident leverage have target the think stock. in market want seen I risk up to helpful kind Xx? side point. the some you the of come feel to I market for but be you seem cash strategy? the X.X And how this.

Dexter Goei

listen, pretty that at flow cash much our numbers comment, daily appreciate Well, regularly look I a basis. we but on

lower and to maybe sit look low as who next X levered stock numbers in at lot the or calculations our a right? doesn't fully it's under trading are free cash of peers confidence lot us flow at cash we have our slightly that in and very growth really on projects it's top have difficult free targets, leverage flow We flow sizable look a aggressively that delivering our taxed, a over better double-digit our is improvements line yield there you year cash say targets, to of and most that single-digit for lowering free make that flow deleveraging when be sense. yield, numbers in and cash in If start you

about out they very I CapEx is significantly the think concerned balance XX% street, you're EBITDA minus at running the higher anyone XX%, than and there are leverage absolute, in on if levered sheet. then our

we're the looking on be day, So very end suggest of we leverage targets, at to - the sleep we leverage you're with then the right? a that target, run if higher at their business significantly comfortable But we where would math well our night. should

a us think tomorrow, at a whole point and about, And buybacks shareholder X.X about order. that your or very short So you makes night. reallocation in very capital, to allows whether be a almost math, we've do well today needs what a us policy talked year, is I to there deleveraging sleep spoken run we right? of if we're Xx share to

absolutely and softness there's if we at we'll cash our profile, have steps necessary, put the So in that will flow a equity make never we view free then our risk.

Marci Ryvicker

do quickly, I you've How don't addressed systems billing I if appreciate now? this. have And response. know you many that

Dexter Goei

Optimum, billing each systems Suddenlink currently the one one over at similar in have on side, BXC two the our BXB at one and we very and on Well, - side.

single we system going side. simultaneously, single So one billing are the billing also on on side one to billing integrating into be the BXC doing system BXB and, systems those

Marci Ryvicker

to bunch Charter's Do systems we numbers systems. billing they of you from know saw And only of the ask because as timing of that? lot a in I messiness smaller a billing went

Dexter Goei

their what Charter - Yes, done at to of not single was have what friends the necessarily And of over I the towards goal think understand a year. to our billing top this platform, into legacy but I effectively put billing this was system to second wrapper, systems. of that's a merge the as do on half end a

I think I merge is into systems number systems, think view they're amount historically go think increasing reducing of was And billing billing and they restructuring processes. they're I and experience have. whenever not the of to the our the two So we integration necessarily our

times they're reason to area. have - be our We we've And at by the we here IT all experience, seamless done we've on risk, did telecoms-related friends do related and think all to obviously. doing they not this. we've Charter just way experience we a like not about the But to whole possible. going businesses. And doing a got over, without it's But here many we platforms it's in don't feel deliver something issue, I'm this. over with our cautious this for something as times a ability I need as people that our It's go But over. feel We're issue to want it. but - we board sure definitely in the the to this maybe many are the many, be way it, in way, across gray done and to many, able good tools, a the extremely the do about

Operator

Harrigan Your with of the Buckingham Research. next Matthew comes from line question

Matthew Harrigan

they buybacks deal doing architectures more of doesn't it questions. and I like it's buybacks you Actually, vantage pretty given do and of kind eventually the it. will of that and when great Apologize And and might and with preserve honestly, other but secondly how I deep you being efficient verbose But to something if don't seems question, your transformational just repurchases, of And some risk to say, forklift you pretty we're blow vendors, cable on you are all Marci's of do to latitude some absurdly some on the gist a street [indiscernible] and point you try FiOS, under the it. ROI optionality to comment preserve are that? somethings you mean, or global undervalued obviously the think surely the their your look stock do particular, in that the And there's to market numbers on on experience They feel fiber are How of side. go. Comcast, They lot balancing thought can transitional two readily transformative, do of technology adds in the sometimes strategically now? versus really CapEx - from for that's the more many you it even One, a right guess, trying people about share numbers on optimization effusive some fiber internationally. buybacks the the to were sheet. from who on companies, on I where as a a when Can at rather. they that through balance FiOS CapEx seeing then got pretty builds recognizable brand a Verizon of build-out, distributed OpEx involved with issue names. going of access a that other some bit seduce some

Dexter Goei

homes have our starting to people think has actual our drops seen. U.S. of up of from providers constraints. within build the I in on technology focused our you, hear deliver than and people's you seen, to on the fiber and to our feel Matt. the ability budget what FiOS Nice Listen, setting we And last comfortable execute other into on year what international here given fiber-to-the-home side,

recall, and are out may rolling Portugal. we in you France fiber aggressively Matt, in As

we the and the points snow have price points York countries, with regulatory differences our in French feel the and between we Alps, in New different certain labor the know-how excluding So price between the the and nothing comfortable adjusted but architecture, So there. snow right? there's

our to in is well have remember got a network terms than Optimum that the of an as we of advantage the amount as aerial actually footprint lot dense more network of You've in example. here as France's that's here our density an the

forward nothing from that pretty you the and are even post think going the a we're the I much better it's from feel to profile and because we're all itself heading where CapEx into mixer, need good heading we going about on put to where FTTH we rollout CapEx after a do So network that. profile about

properly. how to repurchase every is capital program, you faces, which conundrum decisions think company listen, balance raised a I share the On and allocation single

think M&A our that is focus. I clear it's today, not

or to shares. focus So buy to back we allocation could capital on single-handedly delever

around price this waiting in. sit think a continue in where depending more be better that use alone Maybe, don't And delever It fleeting purview is two respects. on their as many there's it an to next question a takes dance at the year pace. capital. M&A M&A delever people be rapid is asked, I occur. let and and significantly people hats so as transaction is. to is may a our in our maybe I to to throw for we to for stock than think

to necessarily. the like situation So expand we'd arises. continue make we But our decisions around if waiting on allocation sit to obviously taken, point something to can't happen and capital

that to ready So we need occurs. be when

Matthew Harrigan

New French a lot snow. better York than the snow is The in the Alps

know you think - the but got than I As better right me way.

Dexter Goei

be may that's They slight right. better,

Operator

turn This concludes to back our I'd presenters. call. to call question-and-answer over the the portion of like the

Nick Brown

with next Thank you and catching Thank joining, very to few weeks. the in up we you. for forward you much look

Operator

This concludes today's conference.

You may now disconnect.

Altice USA (ATUS) 9 May 182018 Q1 Earnings call transcript