Liberty Broadband Corporation

Ladies and gentlemen, thank you for standing by. Welcome to the Liberty Broadband Q1 earnings call. During the presentation, all participants will be in a listen-only mode. Afterwards, we will conduct a question and answer session. At that time, if you have a question, please press star 1 on your telephone. As a reminder, this conference is being recorded. I would now like to turn the conference over to Courtney Chun, Chief Portfolio Officer. Please go ahead.

Good morning. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent forms 10-K and 10-Q filed by Liberty Broadband and Liberty Trip Advisor with the SEC. These forward-looking statements speak only as to the date of this call, and Liberty Broadband and Liberty Trip Advisor expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein, to reflect any change in Liberty Broadband or Liberty Trip Advisors' expectations with regard thereto, or any change in events, conditions, or circumstances on which any such statement is based. On today's call, we will discuss certain non-GAAP financial measures for Liberty Broadband, including adjusted OIBDA, information regarding the comparable GAAP metrics, along with required definitions and reconciliations, including preliminary note and Schedules 1 and 2, can be found in the earnings press release issued today, which is available on Liberty Broadband's website. Now I'd like to turn the call over to Liberty's President and CEO, Greg Maffei.

Thank you, Courtney, and good morning to all of you out there. Today, speaking on the call, besides myself, we'll have Liberty Broadband's Chief Accounting and Principal Financial Officer, Brian Wendling. Also during the Q&A, we will answer questions related to Liberty TripAdvisor, Ron Duncan, CEO of GCI, and Pete Pounds, the CFO of GCI, will also be available to answer questions. So turning now to Liberty Broadband. In March, Liberty Broadband began participating in charters buyback, holding our fully-delivered ownership at 26%. Through April, we had received nearly $1 billion of proceeds, and we used these proceeds to repurchase 6.1 million LBRDK shares from February through April at an average price per share of $152.30 per share. We view this as having meaningful value creation for our shareholders with the LBRD NAV discount running about 19% and allowing us to have a look-through purchase price on charter of about $516 per share. While our quarterly repurchases may fluctuate due to the timing of cash received and et cetera, we expect that our LBRD repurchases to match or exceed the active tax proceeds we receive from sales of charter shares on an annual basis. I would remind you in 2021, we expect only 5% to 7% tax leakage on any charter share sales due to some tax loss carry forwards. Looking now at charter itself, we are approaching the five-year mark of the purchase of Time Warner Cable and Bright House. The EV of charter has gone up over $100 billion through this period, and our total gain in Charter prior to the time in which we began selling to our buyback was nearly $30 billion, and we're up over four times on our initial investment. In Q1 at Charter, growth in data usage continued to grow. We added 2 million internet customers over the past year, and the average internet-only customer is using 700 gig per month in the first part of the quarter, up nearly 20% year over year. And there are a sizable cohort of users using more than one terabyte per month. Charter continues to invest in its network to satisfy that demand at a high ROIC. During the first quarter, residential revenue grew 5.8%, the fastest level of growth in several years. and the adjusted EBITDA grew 12.5%. That's up double digits for the third consecutive quarter, and margins expanded over 200 basis points year over year. Charter's mobile business continues to demonstrate strong growth. Revenues were up 90% year over year. We added 300,000 mobile lines, which is especially impressive considering the general low level of sales activity in Q1, as Tom and Chris noted on their call. There are meaningful potential cost savings for customers who choose Charter as a full service connectivity partner, including mobile. So with that, let me turn over to Trip Advisor and Liberty Trip Advisor. And beginning first at Liberty Trip, at the corporate level, we completed the repurchase of 42% of Sertare's preferred shares for $373 million. We note that 3% of the repurchase was actually completed after the quarter ended. We funded that with the net proceeds of a new $330 million TRIP exchangeable bond, and we delivered $92 million in TRIP stock to Certaris. Importantly, Certaris waived their put rights under their preferred, eliminating any potential negative overhang on L-TRIP and giving us a four-year runway on that security for value creation potential. Certaris has been a great partner over the past year. We look forward to their continuing and ongoing involvement. and Greg O'Hara's continuity on both the TRIP and L-TRIP boards. Now turning to TRIP Advisor itself, TRIP continues to see rising demand for leisure travel in its platform, led by domestic travel, particularly U.S. domestic travel. We believe the U.S. can be a leading indicator for global travel as the vaccine rollout continues worldwide and other countries replicate the successes we have had here. In March, for example, U.S. traffic on the site approached 80% of 2019 levels. Trip continued to exhibit cost discipline in the first quarter, which we believe positions us well for increased operating leverage going forward. We also made good progress on our direct TV offering, TripAdvisor Plus. While Plus is still only in beta, it is already saving subscribers an average of more than $300 per booking. much greater than the $99 subscription fee. TRIP also opportunistically accessed the bond market in tandem with the L-TRIP bond offering we did in March, and they priced a $345 million convertible note up 37.5% at an attractive 25-bit rate. So with that, let me turn it over to Brian to discuss the financials in a little more detail.