Liberty Global Ltd.

stand by. Good day, everyone. You are holding for Liberty Global's fourth quarter 2025 investor call. Thank you for your patience. The investor call will begin in approximately five minutes. Thank you. Thank you. Good morning, ladies and gentlemen, and thank you for sending by. Welcome to Liberty Global's fourth quarter 2025 investor call. This call and the associated webcast are the property of Liberty Global, and any redistribution, retransmission, or rebroadcast of this call or webcast in any form without the express written consent of Liberty Global is strictly prohibited. At this time, all participants are in a listen-only mode. Today's formal presentation materials can be found under the Investor Relations section of Liberty Global's website at libertyglobal.com. After today's formal presentation, instructions will be given for our question-and-answer session. Page 2 of the slide details the company's safe harbor statement regarding forward-looking statements. Today's presentation may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including the company's expectations with respect to its outlook and future growth prospects, and other information and statements that are not historical fact. These forward-looking statements involve certain risks that could cause actual results to differ materially from those expressed or implied by these statements. These risks include those detailed in Liberty Global's filings with the Securities and Exchange Commission, including its most recently filed Forms 10Q and 10K as amended. Liberty Global disclaims any obligation to update any of these forward-looking statements to reflect any change in its expectations or in the conditions on which any such statement is based. I would now like to turn the call over to Mr. Mike Freese.

Hello, everyone, and thanks for joining us today. As you would have seen by now, in addition to our results, we announced two significant transactions earlier today, which of course we'll address in our prepared remarks. As a result, I think this call may run over 60 minutes. I hope you can stick with us because there's quite a bit to talk about here. We've broken this down into our typical quarterly results presentation, which Charlie and I will breeze through as we usually do, perhaps a little faster than normal. And then we'll move into more of a strategic update like we did two years ago at this time. I also think it might be a good call to follow the slides that we're broadcasting, especially the second half. But let me jump right in on slide four. And certainly by now, you are all familiar with how we organize and manage our business today. As illustrated here, everything falls into one of three operating verticals. Liberty Telecom comprises our four national FMC champions that generate $22 billion of revenue and $8 billion of EBITDA on an aggregate basis. And where our primary goals are to drive commercial momentum and, importantly, unlock equity value for shareholders. Much more on that in a moment. Liberty Growth on the far right houses our portfolio of media, infra, and tech investments, totaling $3.4 billion today. And here we're focused on rotating capital, right, and investing in high-growth sectors with scale and tailwinds. And, of course, in the center sits Liberty Global itself with $2.2 billion of cash and a team with decades of experience operating and investing in these businesses. Now, I'll come back to this slide in the strategic update, but first let me provide some highlights on each of these for 2025. So it has clearly been a busy year for us on all three fronts. And as slide five points out, we feel like we've delivered on our core strategic priorities. There's a lot of detail here, so I'm just going to hit a few of the high points. We'll talk about our telecom operating results in the next couple of slides, but we're pleased with the momentum that our commercial and network strategies are delivering, especially in the second half of the year. Supported in parts by the benefits we realized from AI, All of our three large opcos hit their guidance targets last year. When it comes to unlocking value in telecom, a key goal for us, as you know, you've no doubt seen our announcements on the UK fiber transaction and our acquisition of Vodafone's interest in the Netherlands. We'll dig into both those deals shortly, but this is exactly what we said we would do on our call last year and the year before. At Liberty Global, we've totally reshaped our operating model, having reduced our net corporate spend by 75% in the last 12 months. Needless to say, I'm excited to see how this new guidance weaves its way into analysts' sum of the parts calculations. And we continue to allocate capital to the highest return. As you know, we did reduce the buyback last year from 10% to 5% of shares, partially, to be honest, in anticipation of some of these very transactions. And so far this year, we're not actively in the market, but we always remain opportunistic on our stock. And we'll keep you abreast of our plans throughout the course of the year versus guiding to them. With respect to our cash balance, pro forma for the transactions announced today and for what we expect to realize in further asset sales, we should end the year with $1.5 billion of cash. And Charlie will get into that in a bit more detail in a moment. And then finally, our growth portfolio remains highly concentrated with five assets comprising 70% of the $3.4 billion in value. We couldn't be more excited about Formula E. the progress we're making on the Gen 4 car, our racing calendar, and, of course, our sponsors. And we have renewed focus on the experience economy. I'm not going to get into much detail here, but by this we mean live events, sports, etc. We've probably looked at 100 deals in this space. We've done real work on about 40, and we've only closed a handful of very small transactions. So that did give you some comfort that while we're excited about this sector, we're staying very disciplined as we look to rotate capital. Now, the next two slides... Summarized Q4 operating performance for telecom businesses. In the UK, Lutz and the team have implemented a number of things that helped improve broadband performance throughout the year. Initiatives like bundling Netflix and being recognized as a top UK broadband provider. Those things drove a strong Q4 as well as stable ARPUs. Post-paid mobile results were impacted, however, by the increases in that they took in October. Hopefully, we'll see improved performance in 26, especially as 5G coverage continues to grow and pricing pressure settles. In Ireland, a combination of fiber wholesale activations, improved network performance. Actually, they're also ranked the best provider in the market. And off-net expansion, supported net growth in the fixed base with stable ARPUs. Mobile in Ireland continues to grow steadily. Remember, we're an MVNO there, helped in part by a 15-euro offer launched in June. In the Netherlands, Vodafone Ziggo's How We Win plan is driving substantial improvements in the broadband base. Becoming the largest provider of 2-gigabit broadband speeds in the market and recent recognition as the best TV provider helped make Q4 the single best result in fixed services in nearly three years, with steady improvement over the last six months carrying into 2026. Post-paid mobile growth in Holland continues to be supported by nearly universal 5G coverage and a strong flanker brand. And then finally, Telenet had its highest quarterly broadband result in three years, helped by fixed mobile convergence in the south and a strong Black Friday period. And similar to other markets we operate in, our poos were fixed and mobile are very stable. Now, if it wasn't enough information for you, we will be discussing three out of these four markets in our strategic update later in the call, including a lot more commentary on their performance and outlook. So in the meantime, Charlie, over to you.

Thanks, Mike. Now turning to our Q4 financial highlights. Our operating companies in the UK, the Netherlands and Belgium delivered on their four-year guidance metrics despite challenging market conditions. VM02 delivered a revenue decline of 5.9% on a reported basis, which was impacted by lower Next Fibre construction revenues due to a slowdown in the fibre build, and also sustained competitive pressure in both the fixed and mobile market in the UK. On a guidance basis, excluding Next Fibre construction and O2 Daisy, we delivered modest growth for the full year. Adjusted EVDA declined by 2.4% on a reported basis, primarily driven by lower next-fiber construction profitability. Excluding this, adjusted EVDA fell by 1% in Q4, but we still achieved growth overall for the full year of positive 1%. Moving to Vodafone Zygo, we saw a revenue decline of 2.3% in Q4, driven by fixed churn and reduced low-margin IoT revenues. This is partially offset by the annual price adjustment and higher Zygo Sport revenues. Adjusted EBITDA declined 3.4% in Q4, driven by this lower revenue, and higher costs related to commercial initiatives. The four-year figures were in line with the guidance in Q1 for the new How We Win strategy. At Telenet, we saw a revenue decline of 1.3%, driven by our strategic decision to not renew the Belgium football broadcasting rights and lower programming revenues. Adjusted EBITDA declined by 9.9%, driven by elevated labour and marketing costs. as well as hire professional services and outsource labor spend. Turning to our Treasury update, we've been extremely proactive through 2025 and the early part of 2026 in extending our 2028 and 2029 maturities, and we successfully refinanced close to $15 billion across our credit silos. At both VMO2 and Vodafone Zika, we have fully refinanced all 2028 maturities, following successful term loan refinancings, senior secured note issuances, and private taps within these credit silos. In Belgium, as we announced at Q3, we have €4.35 billion of committed financing at wire, which is contingent on BCA regulatory approval of our Fibre Sharing Agreement. A portion of the proceeds, around €2.34 billion, are allocated to repay the inter-company loan with Telenet and will be used to rebalance leverage at Telenet. We intend to further repay some of the 2028 debt at Telenet with the proceeds from our partial wire stake sale, which is expected to complete this year. All of this proactive refinancing activity has significantly reduced our 2028 maturities and maintained our average tenor of around five years at broadly comparable credit spreads to our historic levels. Turning to the next slide, we remain committed to our disciplined capital allocation model as you rotate capital into high growth investments and strategic transactions. Starting in the top left, we successfully delivered against all three cash flow guidance metrics for the year across our OPCOs and JBs. Additionally, following our corporate reshaping program, Liberty Services and Corporate closed 2025 ahead of guidance at negative $130 million of adjusted WDA, which is around $20 million better than our $150 million target. Moving to the Liberty Growth Walk in the bottom left, the fair market value of our growth portfolio remained broadly stable versus Q3 at $3.4 billion. This was driven by modest investments in NextFiber, Atlas Edge, and Edge Connects, offset by the partial disposal of our ITV stake and the full exit of our Infabrica stake, as well as positive fair market value adjustments at Formula E and UPC Slovakia, which has been held in the growth portfolio until the sale process completes later this year. Turning to our cash walk on the top right, we ended the year with a consolidated cash balance of $2.2 billion. During the quarter, we received $162 million of upstream cash and JV dividends and $140 million of net cash proceeds from disposals in our growth portfolio, including $180 million from the partial ITB stake sale. We spent $34 million on our buyback program during the quarter. We're purchasing a total of 5% of our outstanding shares during the year. Moving to the bottom right, we are aiming to end 2026 with around $1.5 billion of corporate cash. After deducting for the cash outflows related to the M&A transactions Mike will touch on in a minute, we intend to replenish our corporate cash with a combination of dividends and cash upstream from our operating businesses, as well as non-core asset disposals from our gross portfolio. So into liberty growth in media and sports, our strategy remains to invest in live sports and entertainment platforms with growing global fan bases, Formula E is our lead example of this, and Season 12 has started strongly ahead of the launch of the Gen 4 car. Our data centre assets, Edge Connects and Atlas Edge, continue to show strong top-line revenue growth, supporting a $1 billion-plus year-end valuation. And our energy transition assets also made big steps forward in 2025. Egg Power secured £400 million of senior debt to help fund over 400 megawatts equivalent of wind and solar power projects, And Believe, our destination charging business, has now built 2,500 public charging sockets, which are averaging around £1,500 per socket, with a further 23,000 awarded to them by UK local authorities. And they're currently bidding on a large number of additional sockets which are being awarded. In tech, the focus is on AI. We made a strategic investment in 11 labs, and we're also moving our in-house AI investments into the growth pillar, given their potential to sell services to third-party customers outside the Liberty family. We've also established a new services pillar and have transferred Liberty Bloom into it from Jan 2026. Now, Liberty Bloom develops tech-enabled back-office solutions for Liberty Global companies as well as third parties. It delivered over 20% revenue growth in 2025, achieving over £100 million of revenue with an order book of nearly £400 million. The initial value has been set at £100 million We've hired a new CEO to accelerate growth. Starting January 2026, we're also introducing an annual management fee of 1.5% of assets under management, paid by Liberty Growth to Liberty Services. This fee will be funded by distributions from the growth portfolio, including disposals, and will be used to fund direct and allocated operating costs, such as treasury and related legal services, and these are all directly attributable to the growth portfolio. So here's our guidance for 2026. we are providing guidance by operating company. For Virgin Media O2 from Q1, 2026, we will move to new disclosure, which better reflects the three key operating verticals following the creation of O2 Daisy. Now these are consumer, business, and wholesale. There's a performer information in the standalone BMO2 release, which explains this further alongside updated KPI disclosures. On this basis, the BMO2 revenue guidance is now set on total service revenues, which we expect to decline by 3% to 5%. Now, this is adjusted for the impact of the DAISY transaction, which is driven by continued promotional intensity, as well as planned streamlining of the B2B product portfolio following the creation of O2DAISY. Adjusted EBITDA is also expected to decline by 3% to 5%, also against a comparable period adjusted for the DAISY impact, driven by lower revenue and lower gross margin due to the changing customer mix. stable property and equipment additions of 2 to 2.2 billion pounds, excluding right-of-use additions, due to continued investment in 5G and fiber to the home, and adjusted free cash flow of around 200 million pounds for the year, supporting cash distributions to shareholders of the same amount. For Vodafone Zigo, we expect stable to low single-digit decline in revenue, driven by a lower fixed base and the flow through the front book pricing impact, albeit with support from continued price indexation and fixed and mobile. Mid to high single-digit decline in adjusted EVDA, driven by OPEX investments into network resilience and service reliability. Property and equipment additions to revenue is expected to be around 23% to 25%. driven by continued 5G and DOCSIS 4.0 investments, as well as the CAPEX component of investments into network resilience and service reliability. Now, to give more detail on this additional investment, we expect 100 million euros of incremental investment of OPEX and CAPEX into network resilience and service reliability during 2026. Now, this will reduce to 50 million OPEX impact in 2027-2028. And we're expecting adjusted free cash flow to be around 100 million euros with no shareholder distributions planned for the year. For Telenet, we're introducing new full-year 2026 guidance based on IFRS financials, excluding wire. We expect stable revenue growth, reflecting a stable operating environment and the annual price indexation under Belgian regulations. Low single-digit growth in adjusted EBITDA, supported by OPEC savings from significant digital and IT investments. and continued lower programming costs. Property and equipment additions to revenue of around 20%, as investments in 5G and digital upgrades step down, and positive adjusted free cash flow of around 20 million euros. And finally, for Liberty Corporates, we expect around $50 million negative adjusted EBITDA, driven by the annualization of the cost savings from the corporate reshaping that took place in 2025, and the implementation of the new 1.5% management fee from the growth portfolio.