Liberty Latin America Ltd.

Good morning, ladies and gentlemen, and thank you for standing by. Today's call is being recorded. I'll now turn the call over to Mike Oliver, VP, Global Financial Reporting of Liberty Latin America.

Good morning, and welcome to Liberty Latin America's first quarter 2022 investor call. At this time, all participants are in listen-only mode. Today's formal presentation materials can be found under the investor section of Liberty Latin America's website at www.lla.com. Following today's formal presentation, instructions will be given for a question and answer session. As a reminder, this call is being recorded and will be available under the investor section of our website. Today's remarks may include forward-looking statements. including the company's expectations with respect to its outlook and future growth prospects and other information and statements that are not historical fact. Actual results may differ materially from those expressed or implied by these statements. For more information, please refer to the risk factors discussed in Liberty Latin America's most recently filed annual report on Form 10-K and the quarterly report on Form 10-Q most recently filed with the SEC along with the associated press release. Liberty Latin America disclaims any obligation to update any forward-looking statements or information to reflect any change in its expectations or in the conditions on which any such statement or information is based. In addition, on this call, we will refer to certain non-GAAP financial measures, which are reconciled to the most comparable GAAP financial measures, which can be found in the appendices to this presentation which is accessible under the Investors section of our website. I would now like to turn the call over to our CEO, Mr. Balan Nair.

Thank you, Mike. Let's welcome everybody to Liberty Latin America's first quarter results presentation. I'll begin with our group highlights and an overview of our operating results. Chris Noyes, our CFO, will then follow with a review of the company's financial performance. After that, we will get straight to your questions. As always, I am joined by my executive team from across the region. I also have our new CTO, Amir Hussain, joining us for this call. I will get him and the rest of the ET involved as needed during the Q&A following our prepared remarks. As a point of housekeeping, we will both be working from slides, which you can find on our website at www.LLA.com. Starting on slide four. And now highlights for the quarter. Revenue was up by 1% on a rebase basis. This was a solid start to the year for the group, driven by strong performances in Costa Rica and CNW, which grew by 9% and 5% respectively, and also robust subscription revenues growth in Puerto Rico. In mobile, we are seeing strong results from our commercial focus on post-bates and delivered a record 121,000 ads in the quarter, significantly higher year over year. We are on track with our integration of previously acquired operations in Puerto Rico and Costa Rica, and this remains an important driver of our future free cash flow growth with over 85 million in synergies anticipated once these businesses are fully integrated. The transactions in Panama and Chile which we expect to drive further value, continue to progress towards completion in line with previous expected timelines. Finally, we have accelerated our buyback activity with over $55 million of shares repurchased in the first quarter, which is our most active quarter to date. Turning to slide five in our broadband internet subscriber ads by market. We are focusing on Internet subscribers here as this is the key driver of our fixed consumer proposition. Starting with CNW in the upper left of the slide, we have a slight negative net ad for the quarter driven by a channel focus on post-paid mobile and churning out bad credit customers. We anticipate our net ads to return in future quarters. Year over year, first quarter financial performance was driven by growth of our base over the past 12 months, so you can see that in the chart. Moving across in the center of the slide and Liberty, Puerto Rico, this continues to be one of our best performing operations. And we delivered a good quarter with 8,000 broadband RGU ads consistent with the last two quarters performance. For this right on the top row to Costa Rica, where we have seen consistent growth in additions and added 9,000 broadband subs in Q1, 50% higher year over year. Moving to the lower left and CNW Panama, we had a strong quarter with 9,000 broadband ads, 80% up on the prior year period. We have continued to invest in our fiber networks in Panama, and it was our second largest market for new build and upgrade activity behind Chile in the quarter. Finally, VTR saw a reduced level of broadband losses in Q1 sequentially, as our commercial activities had some positive impact. However, the market continues to be intensely competitive. We remain focused on stabilizing our subscriber base in Chile, and I'll cover our strategy here in more depth later in the presentation. Overall, the group generated broadband ads improving on Q4 level. Moving to slide six in our mobile performance, we have highlighted post-paid ads as this is our focus and a driver of growth in recurring revenue. starting in the top left of the slide and CNW. Our distribution channel initiatives have continued to drive strong performance with 50% growth in ads year over year and 25% growth sequentially. We expect this momentum to continue through the rest of the year. Turning to Puerto Rico, we had a particularly strong first quarter, adding 39,000 postpaid customers. This was driven by a government initiative incentivizing mobile data access for teachers and students. Excluding these impact additions, we were broadly in line with prior quarters. Moving to the right of the slide in Costa Rica, this is our largest mobile operation in terms of subscribers and was acquired during the third quarter last year. In Q1, we added 44,000 post-paid subs here as we continued to grow our overall customer base and migrate subscribers from prepaid. On the bottom left of the slide, we present Panama's mobile subscriber performance. Building on a strong performance in Q4, we added 28,000 postpaid subscribers in the first quarter, driving 25% year-over-year postpaid revenue growth. In aggregate, we are building momentum and delivered a record quarter for postpaid ads, adding 121,000 subscribers. which was nearly double our Q4 performance. We are improving our post-paid to prepaid mix and growing our recurring mobile revenue. Next is slide seven and our B2B operations. Starting on the left of the slide, we delivered 4% revenue growth in Q1. This was driven by growth in B2B service revenue, particularly in CNW where we won some significant contracts as well as delivering growth in fixed and mobile subscription services. In the rest of the slide, we've outlined some of the products we offer across our B2B customers, starting with SMB in the center. This is a segment which currently represents less than 20% of B2B revenue, but where we've identified that we are underweight and can generate increased penetration. As with all our customers, we aim to combine leading products with fantastic service, in this case 24 by 7 support. And from a product perspective, we have created packages that leverage our full-service communications capabilities with smart solutions layered on top, according to customer needs. On the right of the slide, we present the solutions we deliver to satisfy the needs of larger enterprises and government customers, ranging from essential connectivity to security, collaboration, and IT infrastructure products. Finally, to slide eight. where we provide updates on the Chile market as well as important integrations taking place in Puerto Rico and Costa Rica. Starting on the left of the slide with Chile. As we've mentioned previously, this is an extremely competitive market with multiple operators. Our focus here is to compete aggressively to win and retain customers. Consistent with this approach, we launched a new range of plans called Phoenix in March, a key month of the year including back-to-school campaigns. With these plans, we introduced significantly lower price points for our products with a focus on our broadband offering, which carried the lead discount. As a result, we recorded our highest ever number of gross ads in March, adding 100,000 RGUs. Even though I must say, churn remained a challenge given the competitive intensity. We also saw strong traction across our HFC footprint with the offers. Further highlighting that price is a key decision factor for customers. From an inorganic perspective, we are progressing with approvals for the JV with Claro in Chile and anticipate closing the transaction in the second half. The combination is expected to drive significant annual synergies of over $180 million, as well as consolidation in the markets. On the right of the slide, we wanted to provide an update on the integration activity in Puerto Rico and Costa Rica. The key takeaway here is that both are on track. In Puerto Rico, we are entering an important phase as we look to start migrating customers to our new mobile core towards the end of the year. We anticipate completing all aspects of the integration at the end of next year, and so we'll see the full benefit of over $70 million in synergies during 2024. In Costa Rica, we are progressing similar work streams, however, slightly earlier in the process, given the acquisition completed more recently. Again, we anticipate seeing the full benefit of over $15 million in synergies during 2024. Across both transactions, we expect to deliver somewhere in the region of $90 million of synergies once integration activity is completed. Overall, We have had a steady start to the year and anticipate building operational and financial momentum through 2022. Our inorganic moves should drive additional growth in the coming years, particularly for free cash flow as synergies are achieved. With that, I'll pass you over to Chris Noyes, our Chief Financial Officer, who will talk you through our financial performance before we take your questions. Chris?

Thanks, Valen. In the first quarter, our revenue was $1.2 billion, reflecting a $54 million year-over-year increase. This was driven by the acquisition of the Telefonica asset in Costa Rica and organic growth. These two factors were countered by adverse currency movements, especially with respect to the Chilean peso, which impacted our U.S. dollar reported results. As Valen highlighted, we delivered modest rebase growth of 1 percent for the quarter, led by B2B, and slightly positive rebase growth across both residential and mobile subscription revenue. In terms of our operating units, Costa Rica and CNW Caribbean and Networks were our best rebase performers in the quarter. Turning to adjusted EBITDA, we delivered $440 million in Q1, reflecting a rebase decline of 2%, of which a roughly percentage point of the decline is attributable to the impact of integration costs. Similar to revenue, Costa Rica and CNW Caribbean networks posted strong rebase growth on the back of subscriber volume gains over the last 12 months, which was more than offset by declines in Chile, Panama, and Puerto Rico. In the third section, our P&E additions were $175 million in Q1, or 14% of revenue. Nearly 80% of our quarterly spend was directed to CPE, new build, upgrade, and capacity. Importantly, we expanded our new building upgrade by over 30% in the quarter as compared to Q1 last year, reaching 167,000 homes. This build is virtually all fiber-based and across each of our operating segments. We incurred about $8 million of integration CapEx in the quarter and expect to incur about $40 million in Puerto Rico and Costa Rica for 2022. In the last chart, and consistent with the statement we made on our Q4 call, we delivered negative $57 million of adjusted FCF in the quarter. As a reminder, our first quarter is typically negative due in part to phasing of interest and tax payments. Last year's Q1 result was particularly helped by favorable working capital from our newly acquired mobile business in Puerto Rico. Slide 11 highlights our revenue and adjusted EBITDA results by segment for Q1. Beginning with CNW Caribbean and Networks, we generated $445 million of revenue or 5% rebase growth and $193 million of adjusted EBITDA or 8% rebase growth. Once again, our Jamaican business led with double-digit rebase revenue growth, and nearly all of our residential markets delivered positive rebase growth. Each of our key product revenue categories remained steady as we posted 8% rebase growth in mobile, 5% in fixed residential, and 4% in B2B. With respect to our sub-C business, which is within the B2B category, our growth was adversely impacted by a $4 million headwind relating to IRU accelerations, which largely occurred in Q1 2021. Adjusted EBITDA was propelled by double-digit rebase increases in the Bahamas and Jamaica, and our margin increased year-over-year by over 100 basis points to exceed 43%. Moving to cable and wireless Panama, CWP contributed $127 million of revenue and $41 million of adjusted EBITDA in Q1, reflecting flat rebase revenue growth and a decline of 8% in rebased adjusted EBITDA. Our results moved lower in Q1 from Q4 due in large part to the seasonally strong Q4 we experienced in B2B, particularly around project revenue. With that being said, our residential fixed revenue continued to build with 9% rebase growth, reflecting 75,000 RGUs we have gained in the last 12 months. Residential mobile revenue declined 3% from Q1 2021, primarily as a result of lower prepaid recharging activity which more than offset strong growth in postpaid revenue. Adjusted EBITDA compressed year over year due in large part to an increase in cost to support higher levels of sales. In terms of Liberty Puerto Rico, I will cover it in detail on the next slide. Next to VTR, we reported $171 million of revenue and $47 million of adjusted EBITDA reflecting rebates declines of 9 percent and 26 percent respectively. As expected, Q1 was a tough quarter financially as the annualization impact of lower RGUs and ARPU pressure flowed through the results. Additionally, with our new pricing plans in March, we experienced tremendous sales activity and movements within our base, which impacted March results and will roll through the remainder of the year. Our adjusted EBITDA result was impacted largely by the decline in revenue and higher programming and commercial costs, including a settlement on a programming contract and marketing costs related to a music festival that had been delayed due to COVID. Finishing with Costa Rica. Led principally by continued strong performance in our newly acquired mobile business, we reported revenue of $107 million or rebase revenue growth of 9%. We delivered adjusted EBITDA of $30 million, which represents a double-digit rebase increase over last year's Q1. We incurred integration expense of $2 million in the quarter and are currently projecting integration costs of around $10 million for 2022. Next to slide 12, I wanted to spend a few extra minutes on Puerto Rico. This is our first full quarterly comparison with mobile under our ownership. We reported revenue of $369 million, accounting for 1% rebase growth. The two charts on the left highlight our revenue components with the upper chart for Q1 2022 and the bottom chart for Q1 2021. First, our residential fixed business continues to be fueled by broadband growth as we reported $121 million of revenue in the quarter. Second, residential mobile service revenue of $117 million has remained flat over the year, which is a good result given competition and our rebranding from AT&T. The roughly $10 million decline we experienced in the total mobile category is attributable to lower equipment and inbound roaming revenue. Finally, on B2B and other, we are principally growing on mobile-related services, including equipment, as the island continues to recover, and we are benefiting from increases in FCC funding. Turning to adjusted EBITDA, we delivered $144 million for a rebase decline of 4% year-over-year, which was in line with our own internal expectations. In the bridge walk, the principal drivers are highlighted. We benefited from the positive impact of increased services revenue, which was more than offset by a combination of a higher negative equipment margin, a lower net roaming margin, and net incremental integration costs. As Balan discussed, our integration is moving well ahead. For 2022, we are targeting roughly $50 million of integration spend, split roughly 35% in direct and operating costs and 65% in CapEx. Both components of the integration spend are higher year over year and will begin to decline, particularly CapEx, in 2023. Turning to slide 13, at Q1, including VTR, which is held as an asset for sale on our balance sheet, we had $9.2 billion of total debt, $.9 billion of cash, and $1.2 billion of availability under our revolving credit lines. We had gross leverage of 5.1 times and net leverage of 4.6 times. Our weighted average life is just under six years and our fully swapped borrowing rate is under 6% as well. In the current FX and interest rate environment, our hedges are significantly valuable and in the money. Our debt maturity is largely termed out with only two maturities of note before 2027. Our term loans in Costa Rica and our LLA convert, both of which are due in 2024. As we highlighted on our year-end call, we accelerated our equity repurchases. In fact, we bought 5.4 million shares for $56 million in Q1, our largest quarterly repurchase to date. Since quarter end, we have continued repurchasing at a healthy clip. Moving to the final slide, 2022 is clearly a transition year for LLA with significant focus on integrations in Puerto Rico and Costa Rica and completing the Panama and Chilean transactions. Especially in Puerto Rico, we'll be turning the corner as we exit 2022 with integration spend decreasing and synergies ramping in 2023 as we drop off the TSA with AT&T by the fall of next year. Besides our core fixed residential recurring revenue, we continue to drive enhancements in our mobile business across the Caribbean and Central America as highlighted by Balan today. These regions have always been reliant on prepaid mobile, but we are starting to move the needle on postpaid adoption. very important to us to change the status quo and enhance the reliability and sustainability of the mobile revenue stream. Investing in our network remains a key strategic goal. We are shrinking our legacy copper footprint in our incumbent telco businesses, upgrading and expanding our fiber footprint across our largest operating businesses, and adding mobile capacity, all within a disciplined approach to capital spent. Besides CapEx and M&A, we are also investing in our business through our buyback program and believe its unique opportunity at today's price is given our medium-term growth and free cash flow outlook. With that, operator, if you can open up for questions.

Thank you. The question and answer session will be conducted electronically. If you would like to ask a question regarding the company's operations, please do so by pressing the star or asterisk key followed by the digit one on your touch tone telephone. In order to accommodate everyone, we request that you ask only one question with one follow-up if needed. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. We'll pause for just a moment to give everyone an opportunity to signal for questions. Your first question comes from the line of Matthew Robillard with Barclays. Your line is open.

Yes, good morning and thank you. I had a question about Chile and then maybe read across to other geographies. So your business in Chile, the cable business, historically, as I understand it, was a highly premium product, great content, great service, and correspondingly very good output levels. Obviously, over the past few years, things have changed, and I understand the pandemic didn't help. But I was trying to understand if part of the change was explained by the fact that maybe the plant wasn't as competitive as one could have thought compared to fiber, which has been developing in Chile. So that was the first part of the question, but the second part was, Is there any other geographies where you feel that maybe there could be increased competition from fiber-based competition and where you are exposed to a cable network that may not be as robust as a fiber product? Thank you.

Good morning. It's a good question and one that we've been thinking about and we've analyzed pretty significantly. I'll give you, here's how we think about this. In Chile, as you recall, we've grown this business dramatically in a four-player market. And two of the other players in the four-player market were fiber providers for the longest time. And we won every day of the week, every week of the month. Something changed since then. And what changed really is when there were two additional Competitors that came to the market so a four-player market went to a six-player market and by the way today it's a seven-player market and What happens in a seven-player market is that you have a lot of stranded capacity? meaning you have a lot of folks that either build fiber build infrastructure and Running pretty close to empty networks that have to fill it and therefore their contribution margin for those infrastructure is extremely you know, positive at whatever level dollars you charge for it. And so the challenge we have in Chile is not so much an infrastructure technology issue. Our product is 500 megabits on broadband. Our video product is probably the best in class. We even have HBO in our basic lineup there. We have CDF, the Football League. We have all the great programming. The challenge, of course, is really on pricing. And we experimented with this in the month of March where we took our pricing down. We didn't even go to the lowest price in the market. We just took it down to the third lowest price in the market. And, uh, as I indicated earlier, we added about a hundred thousand RGUs in one month. It was our best month ever, which goes to show that, and most of that came in our HFC network. So, um, So it's really, you know, a question of pricing, which is why we are so excited about the transaction between us and Claro. Consolidation in the market is necessary. Do you have some structural repair? And clearly the synergies between this combination helped, you know, power a lot of things for us going forward. I think both Claro and us are like-minded in that. And we think this could be the start of a lot more consolidation in that market. To your second question around is this a contagion that can spread elsewhere, we've looked at every one of our other markets and we don't see anywhere else going to a six or seven player market on the fixed side. And certainly we've learned a couple of things as well to be ahead of the game before it becomes a six, seven player market in any other location. So if you look at Costa Rica Puerto Rico, these are 4 million type population centers. Costa Rica, slightly north of that, about 5 million. Puerto Rico, about 3 to 4 million. Panama, about 4 million. These are smaller geographies that won't attract 6 to 7 player competitors. So we feel relatively confident. And then I finally end with also one thing. In those markets, we are also now very aggressively upgrading to fiber. In Panama, we hope to get off all of our twisted-pair copper, so it will be primarily fiber, mostly fiber with HFC. In Costa Rica, all our bills are all in fiber. In Puerto Rico, as you know, we won the UNIENDO funding, which we are upgrading the network with that funding to fiber. So we feel really good going forward, and we don't think what happened in Chile would be replicated anywhere else. Hopefully that's helpful. Very helpful. Thank you very much.

Your next question comes from the line of Sumit Data with New Street Research. Your line is open.

Yeah, hi there. One question to start with, please. Just on postpaid wireless, you've featured that quite heavily in the earnings slide. I was just curious what sort of uplift are you seeing at ARPU when you're migrating from prepaid to postpaid? You know, you've got different markets with different levels of postpaid penetration. Puerto Rico is high, Caribbean is low. I guess when might we see some of those penetration numbers where they're lower kind of moving up? And then just kind of finally, is 5G relevant on any sort of near-term horizon in any of these markets? That would be the first question, please.

Sure, Sumit. You know, we are actually quite excited about our post-paid growth for a couple of reasons. As you pointed out, the ARPU is high, and it's quite a bit higher than prepaid. But more importantly, it's very predictable. and stable cash flow and finally you know actually my general counsel reminded me as well earlier this week that you know in addition to that we get better visibility of our customers with postpaid over the prepaid cards so we get better visibility of our customers it's more stable it's very predictable cash flow and it is a higher ARPU having said that this region is mostly a prepaid region it has taken us a few years to really push for this migration to postpaid and a lot of our managers here have deep experience in FMC and we've used that as a way to get people to move, but we've also incentivized and played with our prepaid pricing to make it more attractive for someone who tops up every month to go move to a postpaid product. And we are actually quite happy with that migration, but we're in early days and I suspect You know, there is a cap to that. It's probably, we'll never get to like in the Western countries of like 78% post-paid. It'll be certainly south of 50%. I'm not really sure where the number ends, but we're hoping we can get to even 30, 40% post-paid. We'd be sitting pretty good. On 5G, as you know, we've launched 5G in Puerto Rico and we are doing pretty well there. Handsets are readily available. And it's a product that we have that is, I think, best in class on the island. And as I look at the rest of our region, you know, it's a tail wagging a dog, I guess. I'm not too terribly sure if we would be investing a lot in 5G. Handsets are not readily available. It is expensive. If you recall, when we first started this journey, we just needed people to get to 4G. And even then, 4G penetration is still not anywhere close to Western countries. And so we're still focusing a lot on capacity, pushing more 4G handsets out there. And we may do a few 5G trials in some cities, in metro areas, but not more than trials, but launching into metro areas. We don't see any other operations where we'll go countrywide 5G. I'll wait until the handset's available. It would not be good capital spend to be ahead of the game on this one.

Okay, that's great. Thank you. Just a quick follow-up then on wireless still, but just looking at Panama. Interested to get your thoughts on the announcement of Digicel looking to exit the market. I suppose one thing we're curious is we're still seeing kind of subscriber losses there. We're still seeing revenues down a little bit in Panama. I think there was a reference to maybe the sort of external environment. Do you mind, you know, putting all of that into context would be really helpful. Thanks.

Sure. I'll ask Guillermo. a general manager for that region to be ready to answer the second question as well. On Digicel, you know, I'll tell you this. With our announcement of the Claro acquisition, we've moved from a four-player market to a three-player market, and that was necessary in Panama. And... Yeah, so, yeah, it's moved from a four-player market to a three-player market, and we feel that's just... just right for that market. And vis-a-vis Digicel, we probably shouldn't comment on what's going on with them and their options. I'll ask Guillermo to jump in on the prepaid to postpaid revenue on the mobile side.

Yeah, thank you, Balan, and good morning, Sumit. In Panama, we see a slightly decline in the total revenue mix when you compare Q1 last year with Q1 this year. And that's a tale of two stories. Number one, the prepaid revenue has been somewhat impacted by a very intense competition that is somewhat impacting the recharge activity. And this is what we see when we compare year to year. On the flip side, we see very strong postpaid additions to your earlier question. Our strategy has been focused on getting stronger in postpaid to get all the benefits that Balan depicted, a more stable revenue stream. I would add one more additional value of the postpaid migration, which is the ability to do FMC, the ability to cross-sell a known customer on the postpaid side with fixed services as well. strategy that we are pushing in Panama with very good results. Having said all that, we do see over the last few months a stabilization of the prepaid activity measured by the quality amount of cannibalization that occurs in the market when all competitors are going very aggressively and self-cannibalizing the recharge activity. hopefully, uh, that was helpful for you. That's great.

And maybe just a follow up just on, on digital. I mean, if they've got assets for sale, I'm not sure how it all works, but if they do exit spectrum and towers, I guess, and maybe some infrastructure, is that, is that sort of something you'd be interested in looking at?

You know, uh, to me at this point, we just focus on closing our transaction with Claro and, uh, We really haven't paid much attention to what's going on with DigiCell. At some point in the future, we will look at that, but not right now.

All right. Thanks very much.

As a reminder, to ask a question, please press star followed by the number one on your telephone keypad. Again, that is by pressing star or asterisk key followed by the digit one on your telephone keypad or touchtone telephone. Your next question comes from the line of Matthew Harrigan with Benchmark. Your line is open.

Thank you. I was curious if you had any thoughts on the video evolution in your markets given everything that's happening in the U.S. with all IP, Comcast, and Charter, and then I think initially more in Mexico and the U.S., Televisa launching VIX on an AVOD as well as an SVOD basis. You know, what are the implications for your broadband business as well? And I think at one point you even talked about having more flexibility for a more modest income demographic off an IP video offering, if I'm not mistaken. Thank you.

Thanks, Matt. You know, on the video front, interestingly enough, that announcement by Charter and Comcast and the Flexbox, we've actually launched a similar product a year – and a half ago, but we did not use the RDK platform, which is what Comcast and Charter are doing, which makes absolute sense for them. First, what we did was we went down the Android path, and we launched this now in Puerto Rico, in Costa Rica, in Panama, and we'll soon launch this in a couple of the other islands, Trinidad, Jamaica. It's an all IP box, very similar to the Flexbox. It doesn't take up any of our QAM signals. And we feel really good about it. And the price has come down quite a bit as well on that. And of course, we've been also experimenting with putting that same, because it's all IP and the same technology on other devices like fire stick and Chrome, uh, Chrome dongles. So, so we, we weighed down that path. Now we've also looked recently at our video strategy and we've come to the conclusion that, um, while the video product will, it's not a huge growth driver for us, it is a necessary product for us to continue to be a leader in broadband. And so you sell your broadband product, you ship out this cheap IP box that goes with it, whether it's a box that we ship out ourselves so they can bring a fire stick to it, but you have, you know, a video associated product together with that broadband. And it seems to resonate with a lot of our customers, not all of our customers, We still sell a lot of solo broadband products, but they have a subset of customers that would buy broadband from us only if we had the video product. So we're in it. We're innovating in those technologies, and we feel pretty good on the path that we are.

I think it's a legitimate follow-up on that. What are your thoughts on AVOD versus SVOD in Latin America? I mean, Netflix actually was very sluggish in LATAM. last quarter and Tel Aviv is obviously very excited about, uh, their VIX product. I mean, do you think it's going to evolve to have much more of an AVOD centric market than, uh, in the U S or do you think the jury is still, uh, still out? Thanks.

You know, I, I'll share my personal opinion. I, I, you know, for at least in our region, I shouldn't speak for any other region. Um, AVOD is not an easy product to develop. Um, and, um, I think, you know, which is why, you know, a lot of the big West Coast companies have stuck to the SWAT story. And I think it's similar in our region, for sure. I think for companies that are in the advertising business, that live that, know it really well, I think they can make a go at it. But certainly not, you know, businesses like ours. We're perfectly happy with an SWAT product associated with And if somebody wants to add an AVOD to it, you know, the way we develop our Android platform, we can put almost anybody on it, even an AVOD service on it.

Thanks for jogging my memory on what you already did 18 months ago. A little embarrassed I didn't recall that immediately. Thanks, Paul.

Sure. Thanks, Matt. Thank you.

That will conclude today's question and answer session. I'd like to hand back to Bala Ney for any additional or closing remarks.

Thank you. And, you know, I'd say, you know, first quarter, we felt we started off well. Not as great as previous first quarters, but as we've kind of explained, I think if you go through our numbers, you can see the puts and takes. The underlying business is robust. It's still good. It's strong. We expect the rest of the year to continue to be strong. We continue to monitor Chile. Chile is unique, and I want to reiterate, I think the rationale for us to do what we did in Chile, what we announced last year between Claro and us, I think for both our companies, it continues to make sense, actually even more sense. And I think once we get consolidation going in Chile, things get better. We still remain bullish in that market, even though if you look at it now, you'd scratch your head on it. But I think over the next couple, three years with consolidation and rationality in that market, things will get better there as well. But if you subtract Chile off it, you look at our underlying business, I think we've got a good thing going here. So thank you, everybody, for your support. And we'll talk to you again next quarter.

Ladies and gentlemen, this concludes Liberty Latin America's first quarter 2022 investor call. As a reminder, a replay of the call will be available in the Investor Relations section of Liberty Latin America's website at www.lla.com. There you can also find a copy of today's presentation materials. Thank you for your participation. You may now disconnect.