Liberty Global increases revenue, but subscriber growth slows sharply

Liberty Global beat expectations by delivering its strongest quarterly revenue growth in close to five years for the three months to March. However, the international cable group saw a sharp slowing down in its subscriber acquisition growth despite its well-publicised network build-out programme.

Rebased revenue was up 4.2% to US$1.156 billion thanks to strong growth in Germany – the unit the company is planning to sell to Vodafone – and the UK. Rebased revenue was down slightly in Belgium, Switzerland and Austria, but up in all other markets, led by the UK and Ireland, which saw growth of 5.2%, enhancing its place as Liberty’s biggest single market, accounting for over 40% of revenues.

Operating income was up 17.5% to US$493.1 million, and operating cash-flow increased by 4.7%, the company’s best result since 2014. The company posted a deepening net loss of US$1.186 million for the quarter, up from US$326 million last year.

On the downside, Liberty added only 66,000 revenue-generating units in Q1, a 73% decline in its growth for the prior year period. The company lost 84,000 video customers in the quarter, up from losses of 15,100 in Q1 2017. It gained 78,300 broadband customers, down from the 154,400 gained last year, and 71,800 voice customers, down from 105,000. Liberty added 52,000 mobile customers in the quarter, withy 101,000 contract subscriber additions being offset by the loss of pre-paid customers.

Customer additions were down sharply across all markets, except central and eastern Europe, where growth was in line with Q1 2017. Liberty Global saw increased net RGU losses in Switzerland and Austria, and Belgium, where it said it was hit by intense competition in the market.

Liberty did manage to add 201,000 subscribers to its various advanced TV platforms – Horizon TV, Horizon Lite, TiVo, Virgin TV V6 and Yelo TV – taking its advanced TV base to 45% of its total fixed cable video base.

The company’s advanced WiFi gateway, the Connect box, was taken by an additional 800,000 customers in Q1, taking its installed base to close to 7.3 million or 48% of the overall broadband base.