First Quarter 2018 Results

  • Continued uptake of our quad-play "WIGO" bundles despite a tough competitive market to 333,600 RGUs at March 31, 2018 (+30,000 in Q1 2018), reaching around 15% of customer relationships.
  • Q1 2018 revenue of €618.4 million, marking a slight decrease on a rebased(1) basis and reflecting a continued intensely competitive environment and adverse regulatory impacts.
  •  Adjusted EBITDA of €307.8 million in Q1 2018 (+5% rebased yoy), demonstrating tight cost control and synergy execution. Net profit of €29.7 million versus €65.8 million in Q1 2017.

The enclosed information constitutes regulated information as defined in the Royal Decree of 14 November 2007 regarding the duties of issuers of financial instruments which have been admitted for trading on a regulated market.

Brussels, April 26, 2018 – Telenet Group Holding NV (“Telenet” or the “Company”) (Euronext Brussels: TNET) announces its unaudited consolidated results under International Financial Reporting Standards as adopted by the European Union (“EU IFRS”) for the three months ended March 31, 2018.

 HIGHLIGHTS

  • Q1 2018 revenue of €618.4 million, slightly up by 1% compared to Q1 last year and reflecting certain inorganic movements. On a rebased basis, our top line slightly contracted amidst a tough competitive market, continued adverse regulatory and ARPU trends in our mobile business and the absence of a price adjustment in the first quarter this year, which was largely offset by higher B2B and wholesale revenue.
  • The Q1 2018 net subscriber trend for our video, broadband internet and fixed-line telephony services continued to reflect both an intensely competitive and heavy promotional quarter, which adversely impacted our annualized churn levels.
  • Continued robust net postpaid subscriber growth in Q1 2018 (+28,000) thanks to our converged "WIGO" offers and improved net subscriber trend in the prepaid segment as the impact of last year's mandatory prepaid registration has lapsed.
  • Net profit of €29.7 million for Q1 2018 versus €65.8 million in Q1 last year. Net profit for Q1 2018 was driven by (i) the increase in Adjusted EBITDA, as discussed below, (ii) a €42.6 million non-cash foreign exchange gain on our USD-denominated debt, (iii) a €58.2 million non-cash loss on our derivatives and (iv) a €2.0 million loss on the extinguishment of debt following certain refinancings.
  • Adjusted EBITDA(2) of €307.8 million for Q1 2018, +6% yoy on a reported basis and +5% yoy on a rebased basis. Our rebased Adjusted EBITDA growth was primarily driven by substantially reduced MVNO-related costs as a result of the accelerated onboarding of our Full MVNO customers and tight cost control, partially offset by higher network operating expenses and higher sales and marketing spend in the quarter. Our Adjusted EBITDA margin improved by 270 basis points yoy on a rebased basis to 49.8%, which represented our best quarterly performance since the BASE February 2016 acquisition.
  • Accrued capital expenditures(3) of €156.6 million for Q1 2018, up 25% yoy, and representing approximately 25% of our revenue on the back of continued investments in both our fixed and mobile infrastructures and the start of our IT network modernization project.
  • Net cash from operating activities, net cash used in investing activities and net cash used in financing activities of €191.3 million, €100.6 million and €93.7 million, respectively, for Q1 2018. Adjusted Free Cash Flow(4) of €83.4 million for Q1 2018, marking a substantial improvement versus the €15.9 million negative Adjusted Free Cash Flow we generated in Q1 last year.
  • Full year 2018 outlook reconfirmed as we continue to target healthy financial growth with rebased Adjusted EBITDA(a) growth of 7-8% leading to a rebased Adjusted EBITDA(a) CAGR of 6-7% over the 2015-2018 period. Against stable rebased revenue growth, we expect our accrued capital expenditures to represent around 26% of our revenue in 2018, leading to robust Adjusted Free Cash Flow(b) of €400.0-420.0 million for 2018.d in the Royal Decree of 14 November 2007 regarding the duties of issuers of financial instruments which have been admitted for trading on a regulated market.