First Nine Months 2016 Results

Thursday, October 27, 2016 —

  • Robust uptake of our attractive and innovative quad-play offering "WIGO" since its launch at the end of June with 99,900 subscribers already achieved at the end of Q3 2016;
  • BASE(a) integration on track with joint organization since end-June and the recent start of our mobile network upgrade, enabling us to achieve €220.0 million of annual run-rate synergies by 2020;
  • Rebased(1) top line and Adjusted EBITDA growth of 3% and 2% in 9M 2016 to €1,799.9 million and €847.8 million, respectively, including BASE's mobile business acquired on February 11, 2016.


Telenet Group Holding NV ("Telenet" or the "Company") (Euronext Brussels: TNET) announces its unaudited condensed consolidated results under International Financial Reporting Standards as adopted by the European Union ("EU IFRS") for the nine months ending September 30, 2016.

HIGHLIGHTS

  • Successful launch of our first all-in-one converged offering "WIGO" in late June 2016, resulting in 99,900 "WIGO" subscribers at Q3 2016 quarter-end, boosting quad-play penetration to 23% of cable customers;
  • In mobile, Telenet had its best quarterly net postpaid subscriber growth (+64,700) since early 2013 driven by the traction of our "WIGO" offering, partially offset by declines at BASE and continued competition. In Q3 2016, our total net mobile postpaid subscriber additions, including BASE, reached 52,200;
  • Revenue(2) of €1,799.9 million in 9M 2016, +32% yoy on a reported basis. Year-to-date, we achieved 3% rebased revenue growth with solid mid-single-digit top line growth for our cable business being partially offset by continued competitive and regulatory pressures on our acquired mobile business. Revenue of €621.3 million in Q3 2016, +35% yoy on a reported basis and +1% yoy on a rebased basis, respectively;
  • Net income of €41.6 million in 9M 2016 compared to €135.4 million in 9M 2015, a decrease of 69%. Net income for the 9M 2016 was impacted by a €117.0 million net loss on our derivative financial instruments and a €16.9 million loss on extinguishment of debt due to certain refinancings;
  • Adjusted EBITDA(3) of €847.8 million in 9M 2016, +17% yoy and +2% yoy on a rebased basis. Adjusted EBITDA for both 9M 2016 and 9M 2015 included nonrecurring benefits of €6.0 million and €7.6 million, respectively, linked to the settlement of certain operational contingencies. Adjusted EBITDA growth in 9M 2016 was adversely impacted by €2.9 million higher BASE integration costs. Q3 2016 Adjusted EBITDA of €295.3 million, +22% yoy and +3% yoy on a rebased basis as a result of lower direct costs and our continued focus on cost control;
  • Accrued capital expenditures(4) of €417.6 million in 9M 2016, reflecting (i) the recognition of the Belgian and UK football broadcasting rights, (ii) higher network investments as part of our 1 GHz HFC upgrade project and the start of our mobile network upgrade program, and (iii) the effects of the BASE acquisition. Excluding the impacts related to football broadcasting rights, accrued capital expenditures represented around 19% of revenue in 9M 2016;
  • Net cash provided by operating activities, net cash used by investing activities and net cash provided by financing activities of €518.3 million, €1,527.7 million and €755.0 million, respectively, for 9M 2016;
  • Free Cash Flow(5) of €166.7 million in 9M 2016 with €107.4 million in Q3 2016, driven by (i) solid Adjusted EBITDA growth, (ii) an improved trend in our working capital, and (iii) the implementation of a vendor financing program in Q3 2016, enabling us to extend payment terms for certain suppliers to 360 days;
  • On track to deliver on our full year 2016 outlook, while the execution of our 2020 Vision, including the synergies related to the BASE acquisition, will enable us to achieve profitable growth, targeting a 5-7% Adjusted EBITDA CAGR(b) over the 2015-2018 period.

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