Liberty Global At Morgan Stanley TMT Conference Notes $LBTYK, $LBTYA

  • 2017 outlook calls for accelerated OCF growth of 6-7%
  • Topline drivers: New builds such as Project Lightning in UK, B2B growth, expanding mobile business
  • They are working to accelerate growth to 7-8%
  • Goal is to keep costs as flat as possible over next two years
  • Project Lightning is on track with regards to penetration and ARPU

  • Looking for 30% unlevered returns on new builds
  • Targeting 40% penetration after 3 years in new builds
  • Quad play: still early days but ahead of U.S.; fueled by an incumbent in every market. Liberty has mobile launched in every market; the economic benefit is churn reduction. Each market is treated differently.
  • Preference is a full MVNO that maximizes control over customer relationship. They want to own the SIM card.
  • They have invested in making the WiFi experience in the home very good. This is very important to the customer.
  • 5G will take a while to be market ready. Not a priority for Liberty.
  • Video: Invested to make a multi-screen, beautiful interface available. Churn rate on Horizon is lower. Provides replay TV back seven days on TV and mobile devices. Apps like YouTube and Netflix run on the device.
  • No home runs in content in Europe. They look for smaller incremental content investments.
  • Guiding to $1.5 billion of FCF in 2017; this is the trough. More vendor financing in 2017. They expect FCF will grow in 2018 and beyond.
  • They have a lot of flexibility to scale back new builds if returns do not materialize making it low risk.
  • Project Lightning has not seen much of a response from BT.
  • There is recent progress in turning around Ziggo.

Article by Greg Speicher

Michael Mauboussin Tips From Great Investors [Pt.2]

charles munger moat valuewalk Charlie Munger competitive advantage great companies great brands GARP value investing value investors Google Alphabet profit margins Berkshire HathawayThis is the second part of a short series on Michael J. Mauboussin's research document reflecting on 30 years of Wall Street analysis published in 2016. Q3 2020 hedge fund letters, conferences and more The document outlined Mauboussin's observations of successful investors throughout his three decades on the Street. This article starts at point six. Read More