Liberty Latin America Ltd.

Good morning, ladies and gentlemen, and thank you for standing by. Today's call is being recorded. I will now turn the call over to Danilo Fernandes, Senior Director of Corporate Business, CNW Panama.

Good morning and welcome to Liberty Latin America's second quarter 2024 investor call. At this time, all participants are in listen-only mode. Today's formal presentation materials can be found under the investor relations section of Liberty Latin America's website at www.nla.com. Following today's formal presentation, instructions will be given for a question and answer session. As a reminder, this call is being recorded. 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 facts. 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 filled annual report on Form 10-K and quarterly reports on Form 10-Q, along with the associated press release. LIBERT Latin America disclaims any obligation to update any forward-looking statement 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 investor section of our website. I would now like to turn the call over to our CEO, Mr. Balaner.

Thank you, Danilo, and welcome everyone to Liberty Latin America's second quarter. and first half results presentation. I'll begin with our group highlights and an overview of our operating results by reporting segment. 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'm joined by my executive team from across the region, and I will invite them to contribute 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 our highlights, we continue to grow our high-speed broadband and post-paid mobile bases in the first half, adding 62,000 subscribers in total across the group. This was close to 200,000 additions, excluding Puerto Rico, where we experienced specific challenges related to the completion of mobile subscriber migration and the sunset of the ECF program, which I'll cover later in the presentation. We reported adjusted EBITDA of $763 million in the first half. This included double-digit rebase growth in Panama and Costa Rica. in addition to high single-digit growth in cable and wireless Caribbean. We expect these businesses to continue their momentum in the second half and growth for the overall group to improve as we drive better results in our Puerto Rico operations. We have been aggressive with our buyback activity this year, including the redemption of our convertible notes in July We have now repurchased over $300 million of our equity and converts, which is equivalent to the total capital allocated during 2023. Finally, we continue to look at inorganic ways in which to drive additional stakeholder value, and we are excited to announce our combination with Millicom in Costa Rica. This will improve the market structure, drive synergies, and importantly, allow us to invest in fiber and 5G, delivering even better services for the Costa Rican people. Turning to slide five, I'll begin our operating review with Cable and Wireless Caribbean. On the left of the slide, we present our internet and mobile postpaid additions, where over the past 12 months, we've added 80,000 subscribers in total. Q2 saw flat broadband subscriber performance as our price increases resulted in higher churn during the quarter, which was in line with our expectations. Importantly, we continue to deliver year-over-year revenue growth, and we expect underlying improvements in the second half, although anticipating some one-time impacts resulting from Hurricane Beryl, primarily in Jamaica. Postpaid mobile ads remain robust, driven by another solid quarter in Jamaica, where we've now added subscribers for 16 consecutive quarters. Moving to the center of the slide, we generated 4% revenue growth in the first half of this year, as our consumer momentum was bolstered by strong B2B performance through the award of some notable projects. Lastly, for cable and wireless, I want to provide an update following Hurricane Beryl. which impacted our operations in Jamaica, Grenada, St. Vincent, and the Grenadines in early July. Most importantly, we were very grateful that our colleagues were saved through the storm. These territories did, however, suffer some infrastructure damage, and we have had teams working around the clock to get our services back up and running. We're pleased to confirm that on average, across our impacted markets, over 90% of our fixed and mobile network coverage is online, and this number continues to grow. As ever, in these situations, we are dependent on the power companies reinstating networks so that we can deliver services, and this is an ongoing process. Chris will discuss in more detail, but our expected operational and financial impacts are manageable, and we expect our parametric program will cover the cash flow impact. CNW Caribbean remains on a great trajectory, and we are working with our communities to recover as soon as possible. Moving to slide six and our CNW Panama segment. Starting on the left of the slide, we delivered another solid quarter of internet subscriber additions and robust revenue growth. Our go-to-market strategy is now delivering consistent results across our high-speed network, and we expect this to continue through the rest of the year. In mobile, we reported an exceptional quarter, adding a record number of over 50,000 postpaid subscribers as we successfully won a significant number of customers who came into the market following DigiCell's exit earlier this year. As well as fixed network investments, We are also investing in mobile with successful 5G trials during the May elections showing technology leadership in the market. Moving to the center of the slide, we drove 6% top line growth in the first half with contributions coming from all of our product areas. Overall, we are creating an exciting platform in Panama and are well positioned to continue the momentum we have built during the first half of the year. turning to slide seven and Liberty, Puerto Rico. Starting on the left of the slide, we reported a stable quarter of internet subscriber ads. Fixed revenues flat year over year as growth in our RGU base over the past 12 months was offset by reduced R pool following retention offers, including for our ACP base, who, as we indicated on the first quarter call, have mostly stayed with us. In mobile, our post-paid subscriber performance was impacted by certain factors. Following completion of the migration from AT&T in April, we experienced some disruption across our platforms, which led to increased churn in Q2. We also saw the final quarterly impact of ECF funding being removed for schools in Puerto Rico. This drove a total of 39,000 subscriber losses in Q2 and 74,000 of losses over the past year. As mentioned on the last quarter's call, our pool for these customers is less than half our average across the base. We expect our operating performance to improve and saw some green shoots in our prepaid segment during the second quarter as we added over 2,000 subscribers. which was only our second positive quarter since we acquired the AT&T operation in 2020. In the center of the slide, we show the revenue mix by product in Puerto Rico and the first half year-over-year decline of 11%. Chris will cover the financial puts and takes in greater detail within his section. I will provide more color on our Puerto Rico story in the next slide, but want to be very clear that our long-term message remains consistent. We had expected greater sequential adjusted EBITDA expansion in the second quarter. However, some unanticipated factors affected our performance, and this has led to a small shift in our target timeline to achieve certain milestones. The full effect of synergies and cost savings are still expected in the third and fourth quarters, as we had previously indicated. These synergies Operating cost improvements and top-line sequential growth with FMC should drive adjusted OEBIDA to more than $45 million per month in the second half, however, now towards the end of the year, still setting us up for significant expansion in adjusted OEBIDA for 2025. Moving to slide eight, we wanted to provide an overview of execution today, challenges we faced, and our next steps to drive significantly improved results in Puerto Rico, starting with the commercial side of the business. In terms of execution, we have consistently reported solid subscriber additions across our fixed operations over many years. Fixed revenue represents 40% of our Puerto Rico total, and so this remains a strong foundation for the business. In mobile, we were able to maintain a stable postpaid base until migration began. This is a market structure where we can stabilize and grow share. The prepaid performance I mentioned on the price slide is just the beginning. In terms of challenges, during and following the migration, we have seen subscriber losses across our postpaid and prepaid basis, albeit some Q2 improvements in prepaid, which was the first segment to be migrated. We were also impacted by the ECF program sunset, which is now completed. Importantly, we now have a tremendous opportunity to leverage a full-service product to drive FMC penetration from current levels of around 25%. In mobile, we have a market share around 20%, and there is clearly significant room to grow as we ramp up our commercial efforts. The acquisition of Dishes Boost subscribers and Spectrum, which we expect closing in Q3, is an exciting addition and catalyst here. Moving to operational aspects, the key execution point here was completing the migration in April. This is a complex undertaking for any operator and we experienced challenges, in particular related to mapping and billing as we tried to convert an extensive number of legacy AT&T plans with Associate Quoting to our new platform. We are now through the worst of the disruption and are stabilizing platforms so that our commercial colleagues can start driving top-line growth. Finally, the financial areas. From an execution perspective, we have successfully managed to sustain and grow our fixed revenue for a number of years. We have also mostly exited the TSA and expect minimal costs in the second half. Challenges have centered around certain migration-related costs, which are now mostly behind us. As mentioned, the unanticipated factor in Q2 was a decision with our customer relationship in mind to write off $12 million of bad debt. Looking forward, we expect to drive top-line growth through our commercial initiatives, cost efficiencies from our headcount reduction and other initiatives, and drive synergies. To reiterate, We remain very confident of our longer-term plans and excited by the opportunity to return to growth in Puerto Rico. Turning to slide nine and Liberty Costa Rica. Starting on the left of the slide, we delivered a solid fixed subscriber performance with net ads similar to the first quarter. We've referenced the challenging competitive backdrop in Costa Rica's fixed market in previous calls, This was one of the drivers for the transaction with Millicom that we have announced. I'll provide more color in that deal in a later slide, but we think it will be great for all stakeholders, particularly our customers. In mobile, we reported another strong quarter with growth concentrated in the higher value post-paid segments where net ads were over 60% higher compared to the prior year quarter. Following successful trials, We were first to market with a commercial 5G offering in July, further reinforcing our technology and service leadership in the market. Moving to the center of the slide, we reported healthy rebase revenue growth of 6% in the first half, led by mobile. Next, to slide 10 in our final segment, Liberty Networks. On the left side of the slide, we present revenue for current and prior year first halves. Enterprise continues to be our fastest area of growth, rising by 11% on a rebase basis year over year. This performance was driven by connectivity growth and higher value-added services penetration as customers migrate their mission-critical operations on our cloud infrastructure. To help drive this growth, we host events such as our annual data center and cybersecurity summit. These are great forums for our teams to showcase our capabilities to customers, whilst at the same time getting valuable insights into their needs. Despite facing a year-over-year decline in IRU non-cash revenues, our wholesale business continues to demonstrate resilience. Importantly, we are building a strong foundation of monthly recurring revenues, which bodes well for future prospects. In the center of the slide, we present our revenue split and highlight the strong financial profile of the business. Liberty Network has an adjusted OEBIDA margin above 50%, and given its relatively low capital intensity, an operating free cash flow drops over 40%. Finally, to slide 11 and an update on inorganic moves we are making to drive additional value. Firstly, taking the left of the slide and last week's announced agreement to combine our operations with Tigo and Costa Rica. This transaction will create significant value. In particular, it will improve the fixed market structure, create cost synergies through enhanced scale, bring cross-sell opportunities for FMC across the Tigo customer base, create network synergies given significant footprint overlap, and enable FTTH investment synergies and compete with the existing three FTTH networks in the country. Secondly, an update regarding the acquisition of Spectrum and subscribers from DISH, which we announced last November. We received HSR clearance and anticipate the transaction receiving FCC clearance in Q3. The purchase consideration will be spread across four annual payments from the date of closing with $99 million due at completion. Our commitment to Puerto Rico and the US Virgin Islands is reflected in this deal, where we will acquire a combination of over 100 megahertz of spectrum and over 110,000 boost subscribers. Upon completion, This transaction will provide us with valuable spectrum that will allow us to add more capacity, increase speed, and further strengthen our 5G mobile network, as well as increase our scale in the prepaid market. With that, I'll pass you over to Chris Noyes, our Chief Financial Officer, who will take you through our financial performance before we move on to your questions. Chris?