NASDAQ:LILA Liberty Latin America Q3 2023 Earnings Report $5.57 -0.01 (-0.18%) Closing price 04/25/2025 04:00 PM EasternExtended Trading$5.56 0.00 (-0.09%) As of 04/25/2025 04:05 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings HistoryForecast Liberty Latin America EPS ResultsActual EPS$0.29Consensus EPS N/ABeat/MissN/AOne Year Ago EPSN/ALiberty Latin America Revenue ResultsActual Revenue$1.13 billionExpected Revenue$1.12 billionBeat/MissBeat by +$1.05 millionYoY Revenue GrowthN/ALiberty Latin America Announcement DetailsQuarterQ3 2023Date11/9/2023TimeN/AConference Call DateFriday, November 10, 2023Conference Call Time8:30AM ETUpcoming EarningsLiberty Latin America's Q1 2025 earnings is scheduled for Tuesday, May 6, 2025, with a conference call scheduled on Wednesday, May 7, 2025 at 8:30 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Liberty Latin America Q3 2023 Earnings Call TranscriptProvided by QuartrNovember 10, 2023 ShareLink copied to clipboard.There are 11 speakers on the call. Operator00:00:00Morning, ladies and gentlemen, and thank you for standing by. Today's call is being recorded. I will now turn the call over to Matt Reid, Treasurer of Liberty Latin America. Speaker 100:00:11Good morning, and welcome to Liberty Latin America's Q3 2023 Investor Call. At this time, all participants We're in a listen only mode. Today's formal presentation materials can be found under the Investors section of Liberty Latin America's website As a reminder, this call is being recorded and will be available under the Investors section of our website. Today's remarks may include forward looking statements, including the company's expectations with respect to its outlook, our recently announced pending transactions 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. Speaker 100:00:58For more information, please refer to the risk factors discussed in Liberty Latin America's most recently filed annual report on Form 10 ks and the quarterly report on Form 10Q 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, We 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. Speaker 200:01:45Thank you, Matt, and welcome, everyone, to Liberty Latin America's 3rd quarter 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 am joined by my executive team from across the region, and I will invite them to contribute as needed during the Q and A following our prepared remarks. Speaker 200:02:16As 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 4 and our highlights for the Q3. We had another strong operating quarter with 44,000 additions across Internet and postpaid mobile subscribers. Over the past year, we have added close to a quarter of a 1000000 subscribers across these two products, which shows the strength of our commercial office. We are also continuing to invest in our networks with over 100,000 homes passed, all upgraded in the quarter and 285,000 year driven by activity in Cable and Wireless Caribbean and Panama. Speaker 200:03:05We reported adjusted OIBDA Of CAD 428,000,000 in the quarter, representing a 10% year over year increase. This is our Best rebase growth performance in 2 years, driven by double digit growth in all of our segments apart from Puerto Rico, Which we will cover in later slides. I want to emphasize that this significant growth primarily reflects Structural efficiency improvements across our operations and not one offs. We continue to allocate capital for our buyback program with $12,000,000 between stock and convertible repurchases in the quarter. Through the end of Q3, We have bought back $111,000,000 of our stock $111,000,000 of our stock And reduced the outstanding amount of our convertible bond due next year by 45% to $220,000,000 Finally, we are making progress with our key business integrations. Speaker 200:04:08In Panama, we are already seeing the benefits of synergies, Driving the Q3 adjusted OIBDA growth rate of 25%. And in Puerto Rico, over 225,000 customers Have now been migrated to our platform. We anticipate the process will now run into next year. However, completing a multiyear project of this scale within a Few months of our initial target is still a very good outcome. I'm also excited to I'll highlight the 2 accretive transactions we announced this week. Speaker 200:04:43Firstly, the acquisition of Spectrum and subscribers in Puerto Rico And the U. S. Virgin Islands. And secondly, the sale of mobile tower infrastructure across a number of our markets. I'll cover both deals at the end of my section. Speaker 200:05:00Turning to Slide 5. I'll begin our operating review with C&W Caribbean. The recovery in tourism we initially noticed in the first half of the year continued in Q3, despite it being the low season, Bold string performance in this segment. Starting on the left of the slide with our subscriber ads. We delivered another positive quarter With 20,000 net adds across internet and mobile postpaid, with more than 50% coming from Jamaica, Our FMC strategy continues to drive performance in these two product lines, growing volume and improving our churn levels. Speaker 200:05:38Moving to the center of the slide and our revenue by product. The pie chart depicts the well diversified nature of C&W Caribbean's revenue with B2B And consumer fixed, the largest elements followed by consumer mobile. Year over year rebates growth of 1% was driven by in net and mobile postpaid subscriber growth, where we have achieved over 100,000 net adds in the last 12 months. Adjusting for the discontinuation of the transit business that we announced earlier this year, this rebased growth rate would have been nearly 300 basis points Moving to Slide 6 and our C&W Panama segment. Starting on the left of the slide, Fixed momentum continued with almost 60,000 RGU net adds in the last 12 months across our service bundles. Speaker 200:06:30We have a strong network with 93% of our home's best either via FTTH or HFC, And we are targeting 100% through the removal of all residual copper next year. In mobile, we reported our Q1 postpaid losses in over 3 years, this was driven by conscious decision to reduce our push into lower value segments of the market, Where you can see the increased reported ARPU in Q3 as well as some impact from integration activities. Moving to the center of the slide and our revenue stream, which together drove 10% growth in the quarter. In Panama, our largest product By revenue on mobile and B2B, fixed is the smallest product area, but one of the fastest growing. Positive trends from the first half of the year continued with both fixed and B2B recording strong revenue growth of 7% and 26% year over year respectively. Speaker 200:07:30Growth in fixed revenue was supported by higher volume from our successful commercial strategy, Focus on increasing penetration in our growing fiber to the home network and across triple play plans. In mobile, We saw reduced churn in both prepaid and postpaid. Finally, to our integration update in the lower right of the slide, We have made significant progress with the integration of Claro Panama's operation. Our network consolidation is Close to complete with 99% of overlapping sites now. This is in addition to commercial progress, including optimization of sales channels, People, advertising and sponsorships. Speaker 200:08:14These actions have driven significant synergies supporting our financial growth Despite integration costs peaking in the quarter. Next to Slide 7 and Liberty Puerto Rico. Starting on the left of the slide, we delivered another very robust quarter of in net additions. Continuous investments in our network And commercial activities have supported a 6% subscriber growth over the past year. Turning to mobile, We maintain a relatively stable postpaid base with 7,000 net losses across a total of 900,000 subscribers. Speaker 200:08:54We anticipate being able to grow share from our number 2 position in the market once migration activities have been completed. Our announced acquisition of Spectrum will further support these growth plans. Moving to the center of the slide and our highlights for the segment. We recorded 11% year over year fixed revenue growth in the quarter driven by gains across all fixed services. In mobile, we continued with our subsidy optimization strategy, targeting investments with high value customers in connection with the new iPhone 15 launch, Having previously reduced subsidy levels in the first half of the year, our sales volume were more than 50% higher than the iPhone 14 launch in the previous year. Speaker 200:09:41Finally, to our integration update. We have been progressing with our migration activities And have now moved approximately 225,000 customers to our new IT platform, which is fully operational and being used to sell prepaid and postpaid products to our customers. The migration itself has slowed down due to many factors such as data quality, software incompatibility in number of Android devices, iPhone 15 launch complexity and certain software issues in our IT stack. These have been solved We have a solution that will be delivered in the near term. We continue to monitor and manage these technologies as we scale the platform. Speaker 200:10:29However, there will be an impact to our costs under the TSA, 3rd party contractors and doubling of software licenses costs. In addition, we have invested in more equipment replacement, additional hiring to handle migrations and additional staff in our call centers. These decisions result in one time spend to ensure the best possible customer experience and to minimize churn from migration. We now anticipate integration activities will conclude by April 2024. As I mentioned earlier, We do not regard this as a material shift in the context of such a large and important project. Speaker 200:11:11Turning to Slide 8 and Liberty Costa Rica. Starting on the left of the slide, we returned to Internet subscriber growth in Q3, Showing encouraging stabilization in our most competitive fixed market. In mobile, we reported our strongest quarter of the year In terms of net adds, with postpaid subscribers increasing by 20,000, FMC has been Steadily growing and we are now above 20% penetration in our fixed base. Moving to the center of the slide, Consumer mobile remains our largest product with close to 60% share of revenue. This is followed by our consumer fixed business representing just over 30% and then a small, but fast growing B2B operations. Speaker 200:12:03Finally, our integration activities are now substantially complete with some smaller TSA supported activities anticipated to be migrated early next year. Moving to Slide 9 and our Liberty Networks segment. Running through the revenue performance in the middle of the slide. Wholesale, accounting for 70% of the segment's revenue, delivered 8% rebase growth in Q3, driven by a Significant customer we recognize on a cash basis and high affiliate capacity usage. Typically, The wholesale operations delivered steady low single digit top line growth, mostly USD denominated revenue It has low CapEx requirements, which underpins high cash flow conversion. Speaker 200:12:51Our unique multi ring infrastructure, as shown on the left of the slide, Remains a differentiating factor in relation to the other networks in the region and importantly brings reliability. Enterprise, representing the remaining 30% of revenue, posted a 14% increase, driven by higher demand for our connectivity solutions And IT as a Service product. This is a high growth area for the Group with significant opportunities across our markets, Particularly in Latin America where we have a low market share and there is low penetration of services generally. Moving to the right of the slide and some highlights for this segment. Following our successful branding to Liberty Networks in Q2, We were recently awarded the Best Marketing Team Accolade at the Global's Carrier Awards. Speaker 200:13:45We also continue to deploy innovative solutions to Finally, to Slide 10 and a summary of the transactions we have announced in the past week. Firstly, the acquisition of Spectrum and subscribers from DISH. Our commitment to Puerto Rico and the U. S. Virgin Islands is Further reflected in this deal to acquire a combination of 100 megahertz of spectrum and approximately 120,000 Upon completion, this transaction will provide us with valuable spectrum that will allow us to add more capacity, increase speeds And further strengthened our leading 5 gs mobile network, as well as increased our scale in the prepaid market. Speaker 200:14:43Important to note that the purchase consideration will be spread across 4 annual payments from the date of closing, Which we expect to take place next year. We expect funding for these payments to come from local sources. Secondly, we are pleased to have announced an agreement with a high quality partner in Phoenix Towers That crystallizes the value of approximately 1300 of our mobile tower infrastructure assets at a very attractive cash flow multiple. We will enter into long term lease agreements with PTI upon close, which will enable us continue delivering leading mobile services to our customers and support network expansion, including future 5 gs deployment plans Across the Caribbean and Latin America, we anticipate using the transaction proceeds to reduce third party debt and buyback shares. Overall, we feel very positive as we approach the end of the year, With many of our businesses delivering a good top line and adjusted OIBDA growth, we remain focused on finalizing the integrations in Panama and Puerto Rico, which will further add to our momentum and contribute to cash flow growth in the coming years. Speaker 200:16:03As the transactions have just talked through and we as a management team feel that the business has lots of opportunity for growth Speaker 300:16:11ahead. With that, Speaker 200:16:14I'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? Speaker 400:16:26Thanks, Balan. I'll now take you through our financial performance in greater detail, starting on Slide 12. As a reminder, we deconsolidated our Chilean business the start of Q4 2022, so our reported results in 2023 do not include the operating results of VTR. Revenue was 1% higher on a rebased basis at $1,100,000,000 in the 3rd quarter. We saw positive commercial traction across many of our markets With performance driven by double digit growth in C&W Panama and Liberty Networks. Speaker 400:16:59As mentioned in prior quarters, C&W Caribbean reported revenue was impacted by a business decision to discontinue a legacy non core B2B voice transit arrangement in Q1 2023, Which was accounting for about $10,000,000 of quarterly revenue and will have a similar impact in Q4. Adjusting for this, Q3 group revenue would have grown by 2% on a rebased basis year over year. Turning to adjusted OIBDA. We reported rebased growth of 10% to $428,000,000 our best quarterly result in 2 years and reflecting structural efficiency improvements. Year to date rebased growth was 5% for the group. Speaker 400:17:38And with further growth anticipated in Q4, we are well positioned to deliver our target of mid to high single digit We based adjusted OIBDA growth for LLA this year. In the 3rd column, our P and E additions were $187,000,000 in Q3 Or 17% of revenue. Nearly 60% of our quarterly spend was directed to CPE, new build, upgrade and capacity. We continue to step up our new build and upgrade activity sequentially, reaching over 100,000 homes in the quarter. We are on track to deliver our guidance target of 16% of revenue for 2023. Speaker 400:18:15In the last chart, we delivered $33,000,000 Adjusted FCF in the quarter. As in previous years, we anticipate that our adjusted free cash flow generation for the year will be substantially weighted to Q4, Reflecting our seasonally strong financial performance and favorable working capital swings. Our adjusted FCF target remains at Approximately $300,000,000 before distribution to non controlling interests. Several factors have materialized recently, which add variability to the target this year, Including the delay in timing of the Puerto Rico migration and dependency on large payments, particularly in Panama, Due from B2G and B2B customers that could fall into next year. Slide 13 highlights our segment results. Speaker 400:19:04Beginning on the left with C&W Caribbean. We reported $361,000,000 of revenue in Q3, Reflecting 1% rebased growth and $150,000,000 of adjusted OIBDA, resulting in 14% rebased growth year on year. Adjusting for the transit impact in the prior year period, revenues would have been 4% higher on a rebased basis. Our primary driver of growth was through residential mobile with service revenue expansion led by our postpaid efforts, Prepaid ARPU following price increases earlier in the year and higher inbound roaming. Our strong adjusted OIBDA rebased growth was driven by lower direct costs, Including programming and improved operating leverage across many of our islands. Speaker 400:19:51We finished the quarter with a margin around 42%, More than 400 basis points higher than the prior year quarter. Moving to Cable and Wireless Panama. CWP contributed $190,000,000 of revenue And $59,000,000 of adjusted OIBDA in Q3, reflecting 10% rebased revenue growth and 25% rebased adjusted OIBDA growth. Reed based top line growth was driven by contract wins in our B2B business and an increase in residential fixed subscribers over the past year. Adjusted OIBDA grew strongly in Q3 as we captured value from the Claro Panama integration. Speaker 400:20:27Turning to the middle column, Liberty Networks. We generated $113,000,000 in revenue for 10% rebase growth and $64,000,000 in adjusted OIBDA For an 11% rebased increase. Year over year, rebased revenue growth followed robust performances in both our wholesale and enterprise operations, as Balan highlighted. Adjusted OIBDA growth was driven by our revenue performance. Our adjusted OIBDA margin was just below 60% for the quarter And our operating free cash flow margin stood at a very robust 45% of revenue. Speaker 400:21:002nd from the right, Liberty Puerto Rico. Q3 revenue was $351,000,000 reflecting a year over year rebased decline of 4% and adjusted EBITDA of $116,000,000 Reflecting a rebased decline of 11% as compared to Q3 2022. I'll cover this in more detail on the next slide. Wrapping up with Costa Rica on the far right, we delivered Q3 revenue of $135,000,000 and adjusted OIBDA of $50,000,000 Reflecting flat rebased revenue and rebased adjusted OIBDA growth of 21%. Year over year revenue was flat as subscriber driven growth in was offset by declines in fixed residential revenue from lower video RGUs and ARPU due to increased retention discounts and declines In higher ARPU plans, adjusted OIBDA expanded significantly year over year benefiting from the year over year strengthening of the Costa Rica cologne to the U. Speaker 400:21:55S. Dollar We have certain costs denominated in U. S. Dollars. Turning to Slide 14 and the detailed review of our financial performance in Puerto Rico. Speaker 400:22:05Starting with revenue in the upper half of the slide. Sequentially, revenue was stable with mobile fixed and B2B growth mostly offset by a reduction FCC funds effective in June this year. Year over year, we reported revenue decline of $15,000,000 or 4%. Residential fixed continued to be strong with growth following rate increases and a negative prior year impact of credits issued to customers related to Hurricane Fiona. The increase was also driven by net broadband subscriber additions totaling 23,000 over the past 12 months. Speaker 400:22:38Residential Mobile decreased year over year driven by lower ARPU, including the impact of higher contract asset amortization And reduced roaming revenue due to a change in our agreement with AT and T this year. Other revenue was impacted by the reduction in FCC funds in June as well as the prior year benefiting from increased revenue recognition in USVI. Moving to the lower half of the slide. Adjusted OIBDA was lower sequentially due to an increase in both direct and operating costs. This includes higher equipment costs related to the iPhone 15 launch with strong sales Balan mentioned and free handsets we have offered to customers as part of their migration. Speaker 400:23:17Labor costs also increased in part due to a one off credit in Q2 related to the CARES Act. The year over year decline in adjusted OIBDA is mainly by lower revenue and an increase in OpEx, including the impact of higher professional services and IT related costs related to the migration. Looking ahead to the coming quarters, we anticipate expenses will continue to run at a higher than normal level due to duplication of costs in our business During migration related to the TSA we have with AT and T. Moving to our usual balance sheet overview on Slide 15. At the end of Q3 on a consolidated basis, we had $8,000,000,000 of total debt, dollars 600,000,000 of cash and $900,000,000 of availability under our revolving credit lines. Speaker 400:24:03Important to note that 96% of our debt stack is due in 2027 or beyond And more than 95% has fixed interest rates. The long maturity and fixed interest features of our balance sheet coupled with significant liquidity Result in a robust capital structure for the group. In terms of leverage, we have made good progress reducing levels year to date And then in Q3 at net leverage of 4.3x. In the bottom right of the slide, we have repurchased about $182,000,000 of our convert $111,000,000 of our equity year to date, including a combined $112,000,000 in Q3. Importantly, we have retired about 45% of our convert this year. Speaker 400:24:45And with $220,000,000 outstanding And due next July, we will have ample liquidity to manage redemption next year. Moving to the final slide and our closing remarks. Our consistent subscriber additions and B2B expansion helped deliver top line rebased growth in the quarter. Operational leverage and synergy realization contributed A strong quarter of growth delivering a double digit increase in adjusted OIBDA. Integration execution continues to be a primary focus for us. Speaker 400:25:15While there has been some movement in time lines, these projects are inherently highly complex, and we feel good overall about their execution and the benefits we will achieve once completed. During the quarter, we continued to invest in our leading networks while also repurchasing our equity and convertible notes at attractive prices. As noted by the commentary today, we have been active inorganically, which continues to be a key lever of value for us. We are positioned to have a strong Q4 and look forward to updating everyone in February. With that operator, please open it up for questions. Operator00:25:49Thank you. The question and answer session will be conducted electronically. With one follow-up if needed. We'll pause for just a moment to give everyone an opportunity to signal for questions. Our first question goes to Michael Rollins of Citigroup. Operator00:26:31Michael, please go ahead. Your line is open. Speaker 500:26:35Thanks and good morning. First, just focusing on Puerto Rico. Thanks for all the color and detail on the sequential and year over year changes. Can you provide a little more context In terms of how much the totality of integration and duplicative TSA costs may be weighing on the OIBDA in the quarter and for the year. And maybe just talk about the journey of how the business as you get To get to April of next year and get fully done with the integration, how the financial performance Speaker 600:27:12of this segment improved? Speaker 300:27:17Sure. Thanks, Michael. We had signal a $70,000,000 type Synergy, 4434 and we are still going to get that. It's kind of slightly delayed by perhaps a couple of quarters Due to the delays in our migration. And so the way we think about it is the days definitely an impact. Speaker 300:27:43There's a few impacts here on the cash for us. 1, because of the delay in the migration, we are now not only paying AT and T for the services in the TSA, but we've also stood up our own platforms, both the network and the ID stack and we're already paying licenses for all that. So we kind of like doubled up in costs During this period. The second part is, as we looked at the migration, there were a few things that we over the last 6 months or so have come to the conclusion where there are just a whole bunch of handsets that's just not Feasible for us to software upgrade. These are handsets like Android devices that On an Android path that is really determined by AT and T and those software pushes come out from AT and T, they don't Come out from Samsung as an example. Speaker 300:28:36So when a Samsung release comes out, it's on a different port as the one with AT and T. And in some cases, we've just decided, you know what, it's going to be a terrible customer experience where we do the migration and suddenly the devices do not work. And so we've also taken the decision to start replacing proactively headsets During these migrations, so that's also going to hit us in a cost that we certainly didn't even budget for. So there's a number of things that you'll see impact us towards the end of the year. And certainly, you bleed a little bit into the Q1 of next year and Q2 as well. Speaker 300:29:20But for the most part, next year, it will be less about handsets and stuff and it's really about the doubling of costs On the TSA as well as our own internal licensing costs. Now what happens after April? 2 things. 1, The TSA doesn't completely end at the end of the migration. We still have about a couple of months where we're still going to contract with AT and T For access to DS Systems, the cost drops quite a bit, but it doesn't go to 0. Speaker 300:29:46And the reason we're going to do that is, of course, Over a period after the migration, customers may call in regards to billings and a whole bunch of things that we still need access to prior records. Then I think by June, we'll be completely off. That's on the cost side. But from an operation standpoint, beginning in January, We are going to start exclusively selling all of our devices, all of our postpaid plans On our own stack and that has big implications for us positively. We can start doing a lot of the FMC that we want to do. Speaker 300:30:23We can be a lot more nimble in the promotions that we're doing. That today, any changes in our offerings, we really need to coordinate with AT and T. It gives us a lot of flexibility operationally and as well as a few months later, you'll I'll take a lot of cost out of the system. Hopefully, that was helpful. Speaker 500:30:47Thank you. That was. And I'm looking back at Slide 13, where you lay out the financial performance in the quarter By segment, and I'm looking at the stronger rebased OIBDA growth In C and W, in Panama, in Liberty Networks, in Costa Rica, can you just give us a sense of how much of those OIBDA levels are considered run rate versus maybe any impact that might be a Seasonal point of strength or a transitory source of strength to the extent that there were some like one time benefits or some things that Maybe costs that you avoided that need to come back at some point. So just trying to think about the durability of these new adjusted OIBDA levels Speaker 300:31:51Kind of our new run rate. So we've already taken a lot of the synergies in Panama, in Costa Rica. And when you look at the OIBDA in Cable and Wireless, it also included not necessarily synergies, but some serious cost reductions that are permanent. So what would that be? One would be programming. Speaker 300:32:12We restructured a lot of our content costs in Cable and Wireless that Give us some really good upside on the OIBDA line. In addition to that, The one other area that gave us incremental OIBDA as well is the increment in roaming. Our roaming has returned not to the levels of pre COVID, but people are starting to travel again, cruise ships are out there and so we're getting that upside as well. Now you can say that roaming may go up and down over the years, but we think we've kind of hit that kind of steady state there. It's never going to come back to pre COVID levels, but it's certainly an Expansion over last year. Speaker 300:32:55So between those 2, you saw quite a bit of an OIBDA expansion there. And in addition, the revenues, as Chris pointed out, The revenue growth is actually larger than what is showed here on a year to year basis because of some of the transit traffic that had 0 margins in it. So that was helpful. And then as a matter of fact, when I look at the overall LLA, there are a couple of things here that actually we showed 1% increase At the LLA level, it should be close to like 3% because there's about a couple of one offs from last year, like FCC funding that we got last year that don't exist this year. So that went away. Speaker 300:33:34So that was quite a hit to us. So I think if you normalize for some of the Thanks across LLA as well. We actually grew more than 1%. And that's why I feel really good about your EBITDA contribution margin has expanded. And so you would normally look at it operating wise about a percent grower on the top line and 10% grower on the bottom line, which is kind of a healthy way to run-in operations. Speaker 500:34:08Thank you very much. Operator00:34:13Thank you. And the next question go to Vitor Tamitha of Goldman Sachs. Vitor, please go ahead. Your line is open. Speaker 600:34:22Hello, good morning and thanks for taking our questions. Two questions from our side. The first one is also on the Puerto Rico integration. If you could give us a bit more color On how the decision was taken and why now the decision to extend the timeframe for Puerto Rico? In particular, if anything came up that you did not expect During the course of the integration and on how comfortable you are with completing the integration under the new timeframe? Speaker 600:34:52And our second question would be also on Puerto Rico. If you could give us an update on the competitive scenario, specifically for mobile And on how you have been navigating it in terms of offerings and promotions, since I recall this was a major topic in So after previous conference calls and was still a bit of a difficult competitive environment? Thank you. Speaker 700:35:15Sure. Thanks for those questions. Speaker 300:35:17So the decision to expand the migration was probably we made that decision In the September timeframe August, September timeframe. And at that point, we were still Hoping that we could close some of it. Let me give you a little bit of color into this migration. The migration is made up of multiple migrations. So we have windows between us and AT and T where each window and the windows a day, where we can actually push Subscriber is true. Speaker 300:35:49So it's really kind of like if you think of a regular basis, a port out. So it would be a port out from AT and T and a port into ourselves. So that's kind of like the migration. And we were anticipating to do about 10,000 a day in that migration In each window. And over the period, we've discovered 2 things. Speaker 300:36:121, there were a whole bunch of folks that we were going to migrate. We decided not to migrate because of Handsets issues, these guys, some are not on the right releases. And even with the iPhones, not just the Android, We have a feature voice over Wi Fi when you get to your room, into your house, it goes over Wi Fi. That specific feature On our stack required a software release of like 16.5 and above. And a lot of the iPhones, a lot of users had not Migrated to that software release. Speaker 300:36:44So as we learn all these things, we said, okay, do we optimize for cost and we just ramp everything through Well, do we optimize for the experience of our customers? And we said, let's optimize for the experience of the customers, not only because we're such good guys or anything, But if it's a terrible experience, your churn is going to really mess you up. So we optimized for let's make this as smooth as possible. We went back to AT and T and said we needed more windows. The problem the second problem then hit us, then we were getting through Thanksgiving, we were getting through Christmas holidays. Speaker 300:37:19And then of course, there was the iPhone 15 launch in September, which AT and T shut down all the windows, rightfully so. We didn't argue with them. We just said, okay, now we've lost 14 windows because of the iPhone 15. Then we've lost like a whole bunch of windows, almost 14 windows during the Thanksgiving period. We're going to lose like almost 18 windows during Christmas. Speaker 300:37:40And then when you do the math, you go, okay, let's methodically do this. We'll need to get into January February. We think we're going to beat the April timeline, but we want to make sure that we have enough Runway and get to the end of April and get this thing done methodically. But if you do the backward math in January, February, March April and the number of windows we have, We're going to like easily close this. And our engineering teams, operating teams, a whole bunch of people are just working really hard On all facets of this, setting up a new network, setting up a whole new IT stack is quite unusual in a migration. Speaker 300:38:21Usually, you're migrating customers to your own billing system because you buy a company and it comes with a mobile core and everything. In this case, we didn't get that AT and T still supported us on the network. We had the radios. We owned the radios. We owned the towers, but we didn't have the core. Speaker 300:38:40Then we had to stand up a whole new mobile stack because we didn't have a mobile network in Puerto Rico. And the other complexity is we couldn't use any of our Other IT stacks all core from the rest of our network because Puerto Rico is part of the United States and we have a whole bunch of U. S. Regulations and U. S. Speaker 300:39:00Privacy and security laws that we had to comply with that puts us in a kind of A situation where our core had to be in Puerto Rico and our redundancy in Miami, it's an example. So we could not use any of our other Elements. This thing is really complex, but I tell you, I'm really proud of the team. I've been on many I used to be a CTO and you can talk to any of the CTOs In North America, Europe or Asia, when you have run one of these delivery IT migration projects, usually Either you never get to where you're at, you're missing it by a year, year and a half or you abandon the project altogether. In this case, we're really going to come like within months and I tell the team this is actually quite magical. Operator00:40:03Our next question will go to Cesar Medina of Morgan Stanley. Cesar, please go ahead. Your line is open. Speaker 800:40:11Thank you. The first question is regarding your guidance. You mentioned that there is now a little bit more variability On that target, can you please maybe quantify what is the magnitude of potential availability and the direction of it over and over? And then second regarding Panama, several moving parts in the sense that you have a very positive uplift for B2B, is that sustainable? And then there is protest in the country plus the fate of The 3rd operator DigiCell on that country? Speaker 800:40:46Thank you. Speaker 300:40:48Sure. I'll answer these questions and then I'm going to ask Chris to jump in as well On the guidance, as Chris pointed out, there's 2 things. 1, this whole migration thing, we may end up spending more on headsets. We're going to be very flexible on it. Right now, the reason we're not changing the guidance, we think we're going to hit it, but there's a few things and we thought we ought to like Just give everybody a heads up. Speaker 300:41:121, the equipment and 2, as Chris highlighted in Panama, we have a very large B2B customer that At the end, a lot of your bills are get paid in the months of November December. And we see light at the end of the tunnel, but We thought maybe we should highlight that. If that doesn't come in, it will come in, in January. It's just a timing issue. And Chris will give you more color on that. Speaker 300:41:36In Panama, the business itself, the B2B business, that's where a lot of the growth our B2B business there, it's about 2 thirds monthly recurring and 1 third Non recurring revenue. And a lot of the non recurring revenue comes in, in the 3rd Q4, a lot of government contracts, large enterprise contracts. And we close those deals usually in the second half of the year and then we ride it the following year. And every year, it's kind of like the same cadence that way. And but we feel fairly confident. Speaker 300:42:05It's about a $300,000,000 business to B2B. I don't know if we break that segment out, but I'll tell you it's about a $300,000,000 B2B business, it's about $100,000,000 of NRR and our sales team there led by actually one of our best salesperson And that team delivers every year. So I'm not that worried about the variability Of that business on the B2B segment. On the protest, it is what it is. In Panama, it has impacted us a bit. Speaker 300:42:37Our shops have been closed. 1 of our key shops have been closed. A number of our other shops, the foot traffic have dropped quite a bit. And as you know, in these regions, a lot of our sales happens at the retail level, and happens at the door to door level as well. So a lot of these protests have kind of cramped in a little bit. Speaker 300:42:57But I did check on our sales. We go through our sales numbers every week. And sales, while it slowed down our backlog installs have been increasing. So as soon as this process is done, the installs Gets out there and we should recover. So it's a temporary blip with the protest. Speaker 300:43:18I don't expect much of a hit to us financially. With that, I'll pass to Chris. Maybe just Speaker 900:43:27a little bit color as to the potential headwind we would see in particular around the delay in the migration. There's kind of 2 key points. One is the There's kind of 2 key points. One is the inventory. Since we have both our new stack, which is Getting up and running and then we have the AT and T platform. Speaker 900:43:48We basically have double handset inventory than one would Normally, Carey, going into the holiday season. And then second, we have obviously monthly TSA costs and additional costs Related to the migration. I mean, I would say just conceptually the headwind around that would be greater than sort of $30,000,000 on the free cash flow side, but we are working hard driving our businesses across the group Continue to produce and strive to meet our target that we had given at the start of the year. Speaker 500:44:27Thanks, Chris. Speaker 800:44:29Thank you. Very careful gentlemen. Thank you very much. Speaker 300:44:36Sorry, we missed that. Operator00:44:40Thank you. Our next question go to Sumit Datta of New Street Research. Speaker 700:44:54And then also, I don't think we got an answer on the Puerto Rican mobile conversation. I'd be interested if you could So back on that. So I think that was a previous question. But just first of all, on just thinking about free cash flow Looking into next year, I think, Balan, you mentioned the $70,000,000 of synergies in Puerto Rico is still intact. But as we look forward, should we think about those synergies layering in from here as well as Some of the kind of extra costs we've seen at the moment falling away. Speaker 700:45:30So is the uplift kind of €70,000,000 plus a little bit more? And then secondly, as well kind of looping into the same theme, how much of the synergies are now Coming through in Panama, so how much more can we think about coming in from that market as well? Just trying to get a feel for What sort of cash flow uplift we can think about on a run rate basis once this integration process is completed, please? That's the first question. I'll maybe come back in a second. Speaker 300:46:05Sure. I'll come back to the PR mobile. But On the free cash flow, I don't anticipate us changing our synergy guidance on Puerto Rico. It would be about $70,000,000 annualized Clearly, next year because of the bleed in costs, we'll probably not see the full $70,000,000 next year. In Panama, the incremental synergies is not that significant anymore going forward. Speaker 300:46:30So you'll see the synergies that we've captured a lot this year. Next year, there's an incremental I'm going to try the number like $5,000,000 or so, probably won't exceed $10,000,000 next year Over and above what we've captured this year. That's the number on top of my head for my last reviews. On Puerto Rico Mobile, yes, that was the question. So we actually feel Pretty good about it. Speaker 300:46:58We've said there's 2 things that happened there. At the end of last year when T Mobile really went aggressive on their subsidies, I mean, they were offering iPhone 14, AirPods. They were paying $600,000,000 sorry, dollars 600 to buyout contracts. We had matched it through the end of last year. And of course, Chris and I were Not very happy with the free cash flow implications of matching that. Speaker 300:47:27So in the first half of this year, we kind of slowed down the subsidies. And subsequently, you can see that our net adds came flat. This is just a little right flat, just slightly Sounds good, but kind of noise. So you can say it's just flat. And then what happened in the second half of this year We did a number of changes in our executive team in Puerto Rico on the product side. Speaker 300:47:54And so we've been looking at it through a new lens. And with the iPhone 15, we've come back into the subsidy game quite aggressively, Both on the iPhones as well as non Apple devices as well. And my sense is next year, you're going to see Forcepaid do better. You're going to see prepaid do better as well. We just launched a new prepaid Promotion that I think will capture attention. Speaker 300:48:24It's a 4 by 20 plan. You get 4 lines, dollars 20 each. It's very impressive. And the reason we couldn't do some of these things before is we didn't have our own IT stack. So I did indicate earlier that in January, we'll On postpaid, we will exclusively sell on our own postpaid stack. Speaker 300:48:42But on the prepaid side, we stood that up already. So as of last Sweet. We can just do whatever we promotions we want. And so we're going to get aggressive in the prepaid. And as you look at our mobile business and the number And the lines that we've lost, most of it's on the prepaid side. Speaker 300:48:59So this will now show up the prepaid with the Boost transaction with DISH, Which we should close sometime next year. That will give us more channels on the prepaid. So we feel like the prepaid will get back to a good place. And then on the postpaid side, we're back in the subsidy gain. The returns are actually quite good on that. Speaker 300:49:18We've kind of stretched it in a way that I think works really well for us. So we'll get back into the capture business. And you should look at this In 2024 and 2025, after we have our own stack running on our own network that we will be the attacker in Puerto Rico. And that's Mobile Slate going forward. Speaker 700:49:47Just on the tower deal, that's a great deal, which has just been announced. Could you give any you said it was a great free cash flow multiple. Any kind of steer as to what The multiple will be what sort of free cash flow will kind of fall out as a result of that transaction? And I just wondered, are there more towers To come or is there potentially sort of other infrastructure you're looking to monetize at this time as well? Thanks very much. Speaker 300:50:15I'll answer the last question first. No, we're not looking at any other infrastructure to monetize at this point. Of course, you know we will be very opportunistic, but That's not what we're looking at. This tower deal is we kind of like bundled up a lot of the towers that we thought we should But in this day, days and any more towers, what we thought we should transact is included in this whole cohort. And we feel really good about it. Speaker 300:50:40I'm glad you asked the The press release went out right before the call. Literally, we were closing the final points in the deal Until like 5 this morning, 5:30 and then about 6 o'clock still getting some governance issues resolved. And That's why he was very late on the press release coming out. But we are really excited about it. You asked about the multiple. Speaker 300:51:06We agreed with the sale sorry, with the buyer that we wouldn't talk too much about the multiples. But you can imagine it's highly accretive. It's very happy with it. The headline price and is that The EBITDA Chris or John, can I start by the EBITDA numbers? No. Speaker 300:51:27Okay. Just checking my General Counsel. Yes. We probably won't say the EBITDA hit on it, but you can clearly imagine it's not that significant. Speaker 700:51:40Great. Okay. Thank you. Speaker 300:51:44Yes. We are excited about it, Sumit. That tower deal is a good one. Operator00:51:50Thank you. And our next question goes to Matthew Harrigan of Benchmark. Matthew, please go ahead. Your line is open. Speaker 1000:51:59Thank you. Speaking of good ones, per megahertz pop price On the Spectrum transaction with DISH, it seems really good, especially for that quality of Spectrum. I know it would be a discount to the U. S, but you really If you take out the 120,000 mobile customers, you're also getting it looks like it was just a really good deal for you. Could you elaborate a little bit more on the pricing and the input for Puerto Rico relative to the states? Speaker 1000:52:29Thank you. Speaker 300:52:31Sure. Puerto Rico always trades in the auctions. There's a slight discount Again, it's Mainland. For a couple of reasons. 1, the potential buyers there are limited. Speaker 300:52:442, it's kind of a captive market there. And so it's always traded at a slight discount because it's easy to build a lot more towers there As opposed to just relying on spectrum. Now having said that, the team has done a tremendously good job. I think it's a win win for both us and DISH On that, it's quite accretive for them, accretive for us. It's accretive for them because they don't have to build out in Puerto Rico. Speaker 300:53:09We are going to take on the build out over in Puerto Rico. And so it saves them a lot of CapEx that they can focus in Mainland. Our General Counsel was at the SEC yesterday at the Justice Department and did a tremendous job explaining The rationale for the deal together with the executives from DISH. And so we feel positive about it. I think it's a good deal for DISH. Speaker 300:53:38It's certainly a good one for us as well. It shows 2 things. 1, our confidence in Puerto Rico. And secondly, T Mobile is this huge humongous company, 30 times our size Then we're going to go up head to head with those guys with them day in, day out. We are all in, in Puerto Rico in mobile. Speaker 1000:54:01Great. Thanks, Paul. Operator00:54:07Thank you. That will concludes today's question and answer session. I'd like to hand back to Balan Mayer for any additional or closing remarks. Speaker 300:54:17Thank you, operator. You can clearly see I am very happy. I'm very happy with the Good earnings results for this quarter. And I think the growth that you see here, It's really good. I think Q4 is looking pretty good as well. Speaker 300:54:40And then next year, as we go into next year, we'll go in with a base of EBITDA And revenue that I think we can build nicely on as well. The business is in good place. I know there will be a lot of concerns about Puerto Rico And it's a phase. We'll get through the migrations. The network has stood up. Speaker 300:54:58It's running really well. The IT stacks have stood up. We need to finish the migration. We get off the cost in a year, and nobody will remember about the migration And all that. And this is fundamentally a really strong good business. Speaker 300:55:13The fixed network is growing really well. Prepaid Speaker 700:55:17business is going to grow. Speaker 300:55:18Postpaid business, I think our plans are really good. The Spectrum acquisition we just made, the prepaid business we just bought, I think we're going to put Puerto Rico in a good place. So between that in a good place, our C and W business operating really well, Panama on to big and better things, Costa Rica is doing really well. Liberty Networks is doing really well. I think we've got a good franchise here and I'm really excited about it. Speaker 300:55:45So thank you so much for all your support and have a great day. Operator00:55:53Thank you, ladies and gentlemen. This concludes Liberty Latin America's Q3 2023 Investor Call. As a reminder, a replay of the This 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 all for joining. Operator00:56:14You may now disconnect your lines.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallLiberty Latin America Q3 202300:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) Liberty Latin America Earnings HeadlinesLiberty Latin America Taps CSG to Rocket Wholesale Growth to New HeightsApril 9, 2025 | tmcnet.comThe past three years for Liberty Latin America (NASDAQ:LILA) investors has not been profitableMarch 31, 2025 | finance.yahoo.comReal Americans Don’t Wait on Wall Street’s Next MoveWhat's happening in the markets right now should concern every freedom-loving American who's worked hard and saved smart. Your 401(k) doesn't deserve to be dragged through the mud by tariffs, trade wars, reckless spending, and political standoffs. And you don't have to stand by while Wall Street plays roulette with your future.April 27, 2025 | Premier Gold Co (Ad)Liberty Latin America: WiFi Optimization And Video Enhancements Likely Stock Price DriversMarch 13, 2025 | seekingalpha.comBarclays Downgrades Liberty Latin America (LILA)February 25, 2025 | msn.comBarclays downgrades Liberty Global LiLAC (LILA) to a SellFebruary 25, 2025 | markets.businessinsider.comSee More Liberty Latin America Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Liberty Latin America? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Liberty Latin America and other key companies, straight to your email. Email Address About Liberty Latin AmericaLiberty Latin America (NASDAQ:LILA), together with its subsidiaries, provides fixed, mobile, and subsea telecommunications services. The company operates through C&W Caribbean, C&W Panama, Liberty Networks, Liberty Puerto Rico, and Liberty Costa Rico segments. It offers communications and entertainment services, including video, broadband internet, fixed-line, telephony, and mobiles services to residential and business customers; and business products and services that include enterprise-grade connectivity, data center, hosting, and managed solutions, as well as information technology solutions for small and medium enterprises, international companies, and governmental agencies. The company also operates a sub-sea and terrestrial fiber optic cable network that connects approximately 40 markets. It provides its services under the brands of C&W, Liberty Costa Rica, Liberty Communications, BTC, Flow, and Mas Móvil. The company was incorporated in 2017 and is based in Hamilton, Bermuda.View Liberty Latin America ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Markets Think Robinhood Earnings Could Send the Stock UpIs the Floor in for Lam Research After Bullish Earnings?Texas Instruments: Earnings Beat, Upbeat Guidance Fuel RecoveryMarket Anticipation Builds: Joby Stock Climbs Ahead of EarningsIs Intuitive Surgical a Buy After Volatile Reaction to Earnings?Seismic Shift at Intel: Massive Layoffs Precede Crucial EarningsRocket Lab Lands New Contract, Builds Momentum Ahead of Earnings Upcoming Earnings Cadence Design Systems (4/28/2025)Welltower (4/28/2025)Waste Management (4/28/2025)AstraZeneca (4/29/2025)Mondelez International (4/29/2025)PayPal (4/29/2025)Starbucks (4/29/2025)DoorDash (4/29/2025)Honeywell International (4/29/2025)Regeneron Pharmaceuticals (4/29/2025) Get 30 Days of MarketBeat All Access for Free Sign up for MarketBeat All Access to gain access to MarketBeat's full suite of research tools. 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There are 11 speakers on the call. Operator00:00:00Morning, ladies and gentlemen, and thank you for standing by. Today's call is being recorded. I will now turn the call over to Matt Reid, Treasurer of Liberty Latin America. Speaker 100:00:11Good morning, and welcome to Liberty Latin America's Q3 2023 Investor Call. At this time, all participants We're in a listen only mode. Today's formal presentation materials can be found under the Investors section of Liberty Latin America's website As a reminder, this call is being recorded and will be available under the Investors section of our website. Today's remarks may include forward looking statements, including the company's expectations with respect to its outlook, our recently announced pending transactions 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. Speaker 100:00:58For more information, please refer to the risk factors discussed in Liberty Latin America's most recently filed annual report on Form 10 ks and the quarterly report on Form 10Q 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, We 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. Speaker 200:01:45Thank you, Matt, and welcome, everyone, to Liberty Latin America's 3rd quarter 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 am joined by my executive team from across the region, and I will invite them to contribute as needed during the Q and A following our prepared remarks. Speaker 200:02:16As 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 4 and our highlights for the Q3. We had another strong operating quarter with 44,000 additions across Internet and postpaid mobile subscribers. Over the past year, we have added close to a quarter of a 1000000 subscribers across these two products, which shows the strength of our commercial office. We are also continuing to invest in our networks with over 100,000 homes passed, all upgraded in the quarter and 285,000 year driven by activity in Cable and Wireless Caribbean and Panama. Speaker 200:03:05We reported adjusted OIBDA Of CAD 428,000,000 in the quarter, representing a 10% year over year increase. This is our Best rebase growth performance in 2 years, driven by double digit growth in all of our segments apart from Puerto Rico, Which we will cover in later slides. I want to emphasize that this significant growth primarily reflects Structural efficiency improvements across our operations and not one offs. We continue to allocate capital for our buyback program with $12,000,000 between stock and convertible repurchases in the quarter. Through the end of Q3, We have bought back $111,000,000 of our stock $111,000,000 of our stock And reduced the outstanding amount of our convertible bond due next year by 45% to $220,000,000 Finally, we are making progress with our key business integrations. Speaker 200:04:08In Panama, we are already seeing the benefits of synergies, Driving the Q3 adjusted OIBDA growth rate of 25%. And in Puerto Rico, over 225,000 customers Have now been migrated to our platform. We anticipate the process will now run into next year. However, completing a multiyear project of this scale within a Few months of our initial target is still a very good outcome. I'm also excited to I'll highlight the 2 accretive transactions we announced this week. Speaker 200:04:43Firstly, the acquisition of Spectrum and subscribers in Puerto Rico And the U. S. Virgin Islands. And secondly, the sale of mobile tower infrastructure across a number of our markets. I'll cover both deals at the end of my section. Speaker 200:05:00Turning to Slide 5. I'll begin our operating review with C&W Caribbean. The recovery in tourism we initially noticed in the first half of the year continued in Q3, despite it being the low season, Bold string performance in this segment. Starting on the left of the slide with our subscriber ads. We delivered another positive quarter With 20,000 net adds across internet and mobile postpaid, with more than 50% coming from Jamaica, Our FMC strategy continues to drive performance in these two product lines, growing volume and improving our churn levels. Speaker 200:05:38Moving to the center of the slide and our revenue by product. The pie chart depicts the well diversified nature of C&W Caribbean's revenue with B2B And consumer fixed, the largest elements followed by consumer mobile. Year over year rebates growth of 1% was driven by in net and mobile postpaid subscriber growth, where we have achieved over 100,000 net adds in the last 12 months. Adjusting for the discontinuation of the transit business that we announced earlier this year, this rebased growth rate would have been nearly 300 basis points Moving to Slide 6 and our C&W Panama segment. Starting on the left of the slide, Fixed momentum continued with almost 60,000 RGU net adds in the last 12 months across our service bundles. Speaker 200:06:30We have a strong network with 93% of our home's best either via FTTH or HFC, And we are targeting 100% through the removal of all residual copper next year. In mobile, we reported our Q1 postpaid losses in over 3 years, this was driven by conscious decision to reduce our push into lower value segments of the market, Where you can see the increased reported ARPU in Q3 as well as some impact from integration activities. Moving to the center of the slide and our revenue stream, which together drove 10% growth in the quarter. In Panama, our largest product By revenue on mobile and B2B, fixed is the smallest product area, but one of the fastest growing. Positive trends from the first half of the year continued with both fixed and B2B recording strong revenue growth of 7% and 26% year over year respectively. Speaker 200:07:30Growth in fixed revenue was supported by higher volume from our successful commercial strategy, Focus on increasing penetration in our growing fiber to the home network and across triple play plans. In mobile, We saw reduced churn in both prepaid and postpaid. Finally, to our integration update in the lower right of the slide, We have made significant progress with the integration of Claro Panama's operation. Our network consolidation is Close to complete with 99% of overlapping sites now. This is in addition to commercial progress, including optimization of sales channels, People, advertising and sponsorships. Speaker 200:08:14These actions have driven significant synergies supporting our financial growth Despite integration costs peaking in the quarter. Next to Slide 7 and Liberty Puerto Rico. Starting on the left of the slide, we delivered another very robust quarter of in net additions. Continuous investments in our network And commercial activities have supported a 6% subscriber growth over the past year. Turning to mobile, We maintain a relatively stable postpaid base with 7,000 net losses across a total of 900,000 subscribers. Speaker 200:08:54We anticipate being able to grow share from our number 2 position in the market once migration activities have been completed. Our announced acquisition of Spectrum will further support these growth plans. Moving to the center of the slide and our highlights for the segment. We recorded 11% year over year fixed revenue growth in the quarter driven by gains across all fixed services. In mobile, we continued with our subsidy optimization strategy, targeting investments with high value customers in connection with the new iPhone 15 launch, Having previously reduced subsidy levels in the first half of the year, our sales volume were more than 50% higher than the iPhone 14 launch in the previous year. Speaker 200:09:41Finally, to our integration update. We have been progressing with our migration activities And have now moved approximately 225,000 customers to our new IT platform, which is fully operational and being used to sell prepaid and postpaid products to our customers. The migration itself has slowed down due to many factors such as data quality, software incompatibility in number of Android devices, iPhone 15 launch complexity and certain software issues in our IT stack. These have been solved We have a solution that will be delivered in the near term. We continue to monitor and manage these technologies as we scale the platform. Speaker 200:10:29However, there will be an impact to our costs under the TSA, 3rd party contractors and doubling of software licenses costs. In addition, we have invested in more equipment replacement, additional hiring to handle migrations and additional staff in our call centers. These decisions result in one time spend to ensure the best possible customer experience and to minimize churn from migration. We now anticipate integration activities will conclude by April 2024. As I mentioned earlier, We do not regard this as a material shift in the context of such a large and important project. Speaker 200:11:11Turning to Slide 8 and Liberty Costa Rica. Starting on the left of the slide, we returned to Internet subscriber growth in Q3, Showing encouraging stabilization in our most competitive fixed market. In mobile, we reported our strongest quarter of the year In terms of net adds, with postpaid subscribers increasing by 20,000, FMC has been Steadily growing and we are now above 20% penetration in our fixed base. Moving to the center of the slide, Consumer mobile remains our largest product with close to 60% share of revenue. This is followed by our consumer fixed business representing just over 30% and then a small, but fast growing B2B operations. Speaker 200:12:03Finally, our integration activities are now substantially complete with some smaller TSA supported activities anticipated to be migrated early next year. Moving to Slide 9 and our Liberty Networks segment. Running through the revenue performance in the middle of the slide. Wholesale, accounting for 70% of the segment's revenue, delivered 8% rebase growth in Q3, driven by a Significant customer we recognize on a cash basis and high affiliate capacity usage. Typically, The wholesale operations delivered steady low single digit top line growth, mostly USD denominated revenue It has low CapEx requirements, which underpins high cash flow conversion. Speaker 200:12:51Our unique multi ring infrastructure, as shown on the left of the slide, Remains a differentiating factor in relation to the other networks in the region and importantly brings reliability. Enterprise, representing the remaining 30% of revenue, posted a 14% increase, driven by higher demand for our connectivity solutions And IT as a Service product. This is a high growth area for the Group with significant opportunities across our markets, Particularly in Latin America where we have a low market share and there is low penetration of services generally. Moving to the right of the slide and some highlights for this segment. Following our successful branding to Liberty Networks in Q2, We were recently awarded the Best Marketing Team Accolade at the Global's Carrier Awards. Speaker 200:13:45We also continue to deploy innovative solutions to Finally, to Slide 10 and a summary of the transactions we have announced in the past week. Firstly, the acquisition of Spectrum and subscribers from DISH. Our commitment to Puerto Rico and the U. S. Virgin Islands is Further reflected in this deal to acquire a combination of 100 megahertz of spectrum and approximately 120,000 Upon completion, this transaction will provide us with valuable spectrum that will allow us to add more capacity, increase speeds And further strengthened our leading 5 gs mobile network, as well as increased our scale in the prepaid market. Speaker 200:14:43Important to note that the purchase consideration will be spread across 4 annual payments from the date of closing, Which we expect to take place next year. We expect funding for these payments to come from local sources. Secondly, we are pleased to have announced an agreement with a high quality partner in Phoenix Towers That crystallizes the value of approximately 1300 of our mobile tower infrastructure assets at a very attractive cash flow multiple. We will enter into long term lease agreements with PTI upon close, which will enable us continue delivering leading mobile services to our customers and support network expansion, including future 5 gs deployment plans Across the Caribbean and Latin America, we anticipate using the transaction proceeds to reduce third party debt and buyback shares. Overall, we feel very positive as we approach the end of the year, With many of our businesses delivering a good top line and adjusted OIBDA growth, we remain focused on finalizing the integrations in Panama and Puerto Rico, which will further add to our momentum and contribute to cash flow growth in the coming years. Speaker 200:16:03As the transactions have just talked through and we as a management team feel that the business has lots of opportunity for growth Speaker 300:16:11ahead. With that, Speaker 200:16:14I'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? Speaker 400:16:26Thanks, Balan. I'll now take you through our financial performance in greater detail, starting on Slide 12. As a reminder, we deconsolidated our Chilean business the start of Q4 2022, so our reported results in 2023 do not include the operating results of VTR. Revenue was 1% higher on a rebased basis at $1,100,000,000 in the 3rd quarter. We saw positive commercial traction across many of our markets With performance driven by double digit growth in C&W Panama and Liberty Networks. Speaker 400:16:59As mentioned in prior quarters, C&W Caribbean reported revenue was impacted by a business decision to discontinue a legacy non core B2B voice transit arrangement in Q1 2023, Which was accounting for about $10,000,000 of quarterly revenue and will have a similar impact in Q4. Adjusting for this, Q3 group revenue would have grown by 2% on a rebased basis year over year. Turning to adjusted OIBDA. We reported rebased growth of 10% to $428,000,000 our best quarterly result in 2 years and reflecting structural efficiency improvements. Year to date rebased growth was 5% for the group. Speaker 400:17:38And with further growth anticipated in Q4, we are well positioned to deliver our target of mid to high single digit We based adjusted OIBDA growth for LLA this year. In the 3rd column, our P and E additions were $187,000,000 in Q3 Or 17% of revenue. Nearly 60% of our quarterly spend was directed to CPE, new build, upgrade and capacity. We continue to step up our new build and upgrade activity sequentially, reaching over 100,000 homes in the quarter. We are on track to deliver our guidance target of 16% of revenue for 2023. Speaker 400:18:15In the last chart, we delivered $33,000,000 Adjusted FCF in the quarter. As in previous years, we anticipate that our adjusted free cash flow generation for the year will be substantially weighted to Q4, Reflecting our seasonally strong financial performance and favorable working capital swings. Our adjusted FCF target remains at Approximately $300,000,000 before distribution to non controlling interests. Several factors have materialized recently, which add variability to the target this year, Including the delay in timing of the Puerto Rico migration and dependency on large payments, particularly in Panama, Due from B2G and B2B customers that could fall into next year. Slide 13 highlights our segment results. Speaker 400:19:04Beginning on the left with C&W Caribbean. We reported $361,000,000 of revenue in Q3, Reflecting 1% rebased growth and $150,000,000 of adjusted OIBDA, resulting in 14% rebased growth year on year. Adjusting for the transit impact in the prior year period, revenues would have been 4% higher on a rebased basis. Our primary driver of growth was through residential mobile with service revenue expansion led by our postpaid efforts, Prepaid ARPU following price increases earlier in the year and higher inbound roaming. Our strong adjusted OIBDA rebased growth was driven by lower direct costs, Including programming and improved operating leverage across many of our islands. Speaker 400:19:51We finished the quarter with a margin around 42%, More than 400 basis points higher than the prior year quarter. Moving to Cable and Wireless Panama. CWP contributed $190,000,000 of revenue And $59,000,000 of adjusted OIBDA in Q3, reflecting 10% rebased revenue growth and 25% rebased adjusted OIBDA growth. Reed based top line growth was driven by contract wins in our B2B business and an increase in residential fixed subscribers over the past year. Adjusted OIBDA grew strongly in Q3 as we captured value from the Claro Panama integration. Speaker 400:20:27Turning to the middle column, Liberty Networks. We generated $113,000,000 in revenue for 10% rebase growth and $64,000,000 in adjusted OIBDA For an 11% rebased increase. Year over year, rebased revenue growth followed robust performances in both our wholesale and enterprise operations, as Balan highlighted. Adjusted OIBDA growth was driven by our revenue performance. Our adjusted OIBDA margin was just below 60% for the quarter And our operating free cash flow margin stood at a very robust 45% of revenue. Speaker 400:21:002nd from the right, Liberty Puerto Rico. Q3 revenue was $351,000,000 reflecting a year over year rebased decline of 4% and adjusted EBITDA of $116,000,000 Reflecting a rebased decline of 11% as compared to Q3 2022. I'll cover this in more detail on the next slide. Wrapping up with Costa Rica on the far right, we delivered Q3 revenue of $135,000,000 and adjusted OIBDA of $50,000,000 Reflecting flat rebased revenue and rebased adjusted OIBDA growth of 21%. Year over year revenue was flat as subscriber driven growth in was offset by declines in fixed residential revenue from lower video RGUs and ARPU due to increased retention discounts and declines In higher ARPU plans, adjusted OIBDA expanded significantly year over year benefiting from the year over year strengthening of the Costa Rica cologne to the U. Speaker 400:21:55S. Dollar We have certain costs denominated in U. S. Dollars. Turning to Slide 14 and the detailed review of our financial performance in Puerto Rico. Speaker 400:22:05Starting with revenue in the upper half of the slide. Sequentially, revenue was stable with mobile fixed and B2B growth mostly offset by a reduction FCC funds effective in June this year. Year over year, we reported revenue decline of $15,000,000 or 4%. Residential fixed continued to be strong with growth following rate increases and a negative prior year impact of credits issued to customers related to Hurricane Fiona. The increase was also driven by net broadband subscriber additions totaling 23,000 over the past 12 months. Speaker 400:22:38Residential Mobile decreased year over year driven by lower ARPU, including the impact of higher contract asset amortization And reduced roaming revenue due to a change in our agreement with AT and T this year. Other revenue was impacted by the reduction in FCC funds in June as well as the prior year benefiting from increased revenue recognition in USVI. Moving to the lower half of the slide. Adjusted OIBDA was lower sequentially due to an increase in both direct and operating costs. This includes higher equipment costs related to the iPhone 15 launch with strong sales Balan mentioned and free handsets we have offered to customers as part of their migration. Speaker 400:23:17Labor costs also increased in part due to a one off credit in Q2 related to the CARES Act. The year over year decline in adjusted OIBDA is mainly by lower revenue and an increase in OpEx, including the impact of higher professional services and IT related costs related to the migration. Looking ahead to the coming quarters, we anticipate expenses will continue to run at a higher than normal level due to duplication of costs in our business During migration related to the TSA we have with AT and T. Moving to our usual balance sheet overview on Slide 15. At the end of Q3 on a consolidated basis, we had $8,000,000,000 of total debt, dollars 600,000,000 of cash and $900,000,000 of availability under our revolving credit lines. Speaker 400:24:03Important to note that 96% of our debt stack is due in 2027 or beyond And more than 95% has fixed interest rates. The long maturity and fixed interest features of our balance sheet coupled with significant liquidity Result in a robust capital structure for the group. In terms of leverage, we have made good progress reducing levels year to date And then in Q3 at net leverage of 4.3x. In the bottom right of the slide, we have repurchased about $182,000,000 of our convert $111,000,000 of our equity year to date, including a combined $112,000,000 in Q3. Importantly, we have retired about 45% of our convert this year. Speaker 400:24:45And with $220,000,000 outstanding And due next July, we will have ample liquidity to manage redemption next year. Moving to the final slide and our closing remarks. Our consistent subscriber additions and B2B expansion helped deliver top line rebased growth in the quarter. Operational leverage and synergy realization contributed A strong quarter of growth delivering a double digit increase in adjusted OIBDA. Integration execution continues to be a primary focus for us. Speaker 400:25:15While there has been some movement in time lines, these projects are inherently highly complex, and we feel good overall about their execution and the benefits we will achieve once completed. During the quarter, we continued to invest in our leading networks while also repurchasing our equity and convertible notes at attractive prices. As noted by the commentary today, we have been active inorganically, which continues to be a key lever of value for us. We are positioned to have a strong Q4 and look forward to updating everyone in February. With that operator, please open it up for questions. Operator00:25:49Thank you. The question and answer session will be conducted electronically. With one follow-up if needed. We'll pause for just a moment to give everyone an opportunity to signal for questions. Our first question goes to Michael Rollins of Citigroup. Operator00:26:31Michael, please go ahead. Your line is open. Speaker 500:26:35Thanks and good morning. First, just focusing on Puerto Rico. Thanks for all the color and detail on the sequential and year over year changes. Can you provide a little more context In terms of how much the totality of integration and duplicative TSA costs may be weighing on the OIBDA in the quarter and for the year. And maybe just talk about the journey of how the business as you get To get to April of next year and get fully done with the integration, how the financial performance Speaker 600:27:12of this segment improved? Speaker 300:27:17Sure. Thanks, Michael. We had signal a $70,000,000 type Synergy, 4434 and we are still going to get that. It's kind of slightly delayed by perhaps a couple of quarters Due to the delays in our migration. And so the way we think about it is the days definitely an impact. Speaker 300:27:43There's a few impacts here on the cash for us. 1, because of the delay in the migration, we are now not only paying AT and T for the services in the TSA, but we've also stood up our own platforms, both the network and the ID stack and we're already paying licenses for all that. So we kind of like doubled up in costs During this period. The second part is, as we looked at the migration, there were a few things that we over the last 6 months or so have come to the conclusion where there are just a whole bunch of handsets that's just not Feasible for us to software upgrade. These are handsets like Android devices that On an Android path that is really determined by AT and T and those software pushes come out from AT and T, they don't Come out from Samsung as an example. Speaker 300:28:36So when a Samsung release comes out, it's on a different port as the one with AT and T. And in some cases, we've just decided, you know what, it's going to be a terrible customer experience where we do the migration and suddenly the devices do not work. And so we've also taken the decision to start replacing proactively headsets During these migrations, so that's also going to hit us in a cost that we certainly didn't even budget for. So there's a number of things that you'll see impact us towards the end of the year. And certainly, you bleed a little bit into the Q1 of next year and Q2 as well. Speaker 300:29:20But for the most part, next year, it will be less about handsets and stuff and it's really about the doubling of costs On the TSA as well as our own internal licensing costs. Now what happens after April? 2 things. 1, The TSA doesn't completely end at the end of the migration. We still have about a couple of months where we're still going to contract with AT and T For access to DS Systems, the cost drops quite a bit, but it doesn't go to 0. Speaker 300:29:46And the reason we're going to do that is, of course, Over a period after the migration, customers may call in regards to billings and a whole bunch of things that we still need access to prior records. Then I think by June, we'll be completely off. That's on the cost side. But from an operation standpoint, beginning in January, We are going to start exclusively selling all of our devices, all of our postpaid plans On our own stack and that has big implications for us positively. We can start doing a lot of the FMC that we want to do. Speaker 300:30:23We can be a lot more nimble in the promotions that we're doing. That today, any changes in our offerings, we really need to coordinate with AT and T. It gives us a lot of flexibility operationally and as well as a few months later, you'll I'll take a lot of cost out of the system. Hopefully, that was helpful. Speaker 500:30:47Thank you. That was. And I'm looking back at Slide 13, where you lay out the financial performance in the quarter By segment, and I'm looking at the stronger rebased OIBDA growth In C and W, in Panama, in Liberty Networks, in Costa Rica, can you just give us a sense of how much of those OIBDA levels are considered run rate versus maybe any impact that might be a Seasonal point of strength or a transitory source of strength to the extent that there were some like one time benefits or some things that Maybe costs that you avoided that need to come back at some point. So just trying to think about the durability of these new adjusted OIBDA levels Speaker 300:31:51Kind of our new run rate. So we've already taken a lot of the synergies in Panama, in Costa Rica. And when you look at the OIBDA in Cable and Wireless, it also included not necessarily synergies, but some serious cost reductions that are permanent. So what would that be? One would be programming. Speaker 300:32:12We restructured a lot of our content costs in Cable and Wireless that Give us some really good upside on the OIBDA line. In addition to that, The one other area that gave us incremental OIBDA as well is the increment in roaming. Our roaming has returned not to the levels of pre COVID, but people are starting to travel again, cruise ships are out there and so we're getting that upside as well. Now you can say that roaming may go up and down over the years, but we think we've kind of hit that kind of steady state there. It's never going to come back to pre COVID levels, but it's certainly an Expansion over last year. Speaker 300:32:55So between those 2, you saw quite a bit of an OIBDA expansion there. And in addition, the revenues, as Chris pointed out, The revenue growth is actually larger than what is showed here on a year to year basis because of some of the transit traffic that had 0 margins in it. So that was helpful. And then as a matter of fact, when I look at the overall LLA, there are a couple of things here that actually we showed 1% increase At the LLA level, it should be close to like 3% because there's about a couple of one offs from last year, like FCC funding that we got last year that don't exist this year. So that went away. Speaker 300:33:34So that was quite a hit to us. So I think if you normalize for some of the Thanks across LLA as well. We actually grew more than 1%. And that's why I feel really good about your EBITDA contribution margin has expanded. And so you would normally look at it operating wise about a percent grower on the top line and 10% grower on the bottom line, which is kind of a healthy way to run-in operations. Speaker 500:34:08Thank you very much. Operator00:34:13Thank you. And the next question go to Vitor Tamitha of Goldman Sachs. Vitor, please go ahead. Your line is open. Speaker 600:34:22Hello, good morning and thanks for taking our questions. Two questions from our side. The first one is also on the Puerto Rico integration. If you could give us a bit more color On how the decision was taken and why now the decision to extend the timeframe for Puerto Rico? In particular, if anything came up that you did not expect During the course of the integration and on how comfortable you are with completing the integration under the new timeframe? Speaker 600:34:52And our second question would be also on Puerto Rico. If you could give us an update on the competitive scenario, specifically for mobile And on how you have been navigating it in terms of offerings and promotions, since I recall this was a major topic in So after previous conference calls and was still a bit of a difficult competitive environment? Thank you. Speaker 700:35:15Sure. Thanks for those questions. Speaker 300:35:17So the decision to expand the migration was probably we made that decision In the September timeframe August, September timeframe. And at that point, we were still Hoping that we could close some of it. Let me give you a little bit of color into this migration. The migration is made up of multiple migrations. So we have windows between us and AT and T where each window and the windows a day, where we can actually push Subscriber is true. Speaker 300:35:49So it's really kind of like if you think of a regular basis, a port out. So it would be a port out from AT and T and a port into ourselves. So that's kind of like the migration. And we were anticipating to do about 10,000 a day in that migration In each window. And over the period, we've discovered 2 things. Speaker 300:36:121, there were a whole bunch of folks that we were going to migrate. We decided not to migrate because of Handsets issues, these guys, some are not on the right releases. And even with the iPhones, not just the Android, We have a feature voice over Wi Fi when you get to your room, into your house, it goes over Wi Fi. That specific feature On our stack required a software release of like 16.5 and above. And a lot of the iPhones, a lot of users had not Migrated to that software release. Speaker 300:36:44So as we learn all these things, we said, okay, do we optimize for cost and we just ramp everything through Well, do we optimize for the experience of our customers? And we said, let's optimize for the experience of the customers, not only because we're such good guys or anything, But if it's a terrible experience, your churn is going to really mess you up. So we optimized for let's make this as smooth as possible. We went back to AT and T and said we needed more windows. The problem the second problem then hit us, then we were getting through Thanksgiving, we were getting through Christmas holidays. Speaker 300:37:19And then of course, there was the iPhone 15 launch in September, which AT and T shut down all the windows, rightfully so. We didn't argue with them. We just said, okay, now we've lost 14 windows because of the iPhone 15. Then we've lost like a whole bunch of windows, almost 14 windows during the Thanksgiving period. We're going to lose like almost 18 windows during Christmas. Speaker 300:37:40And then when you do the math, you go, okay, let's methodically do this. We'll need to get into January February. We think we're going to beat the April timeline, but we want to make sure that we have enough Runway and get to the end of April and get this thing done methodically. But if you do the backward math in January, February, March April and the number of windows we have, We're going to like easily close this. And our engineering teams, operating teams, a whole bunch of people are just working really hard On all facets of this, setting up a new network, setting up a whole new IT stack is quite unusual in a migration. Speaker 300:38:21Usually, you're migrating customers to your own billing system because you buy a company and it comes with a mobile core and everything. In this case, we didn't get that AT and T still supported us on the network. We had the radios. We owned the radios. We owned the towers, but we didn't have the core. Speaker 300:38:40Then we had to stand up a whole new mobile stack because we didn't have a mobile network in Puerto Rico. And the other complexity is we couldn't use any of our Other IT stacks all core from the rest of our network because Puerto Rico is part of the United States and we have a whole bunch of U. S. Regulations and U. S. Speaker 300:39:00Privacy and security laws that we had to comply with that puts us in a kind of A situation where our core had to be in Puerto Rico and our redundancy in Miami, it's an example. So we could not use any of our other Elements. This thing is really complex, but I tell you, I'm really proud of the team. I've been on many I used to be a CTO and you can talk to any of the CTOs In North America, Europe or Asia, when you have run one of these delivery IT migration projects, usually Either you never get to where you're at, you're missing it by a year, year and a half or you abandon the project altogether. In this case, we're really going to come like within months and I tell the team this is actually quite magical. Operator00:40:03Our next question will go to Cesar Medina of Morgan Stanley. Cesar, please go ahead. Your line is open. Speaker 800:40:11Thank you. The first question is regarding your guidance. You mentioned that there is now a little bit more variability On that target, can you please maybe quantify what is the magnitude of potential availability and the direction of it over and over? And then second regarding Panama, several moving parts in the sense that you have a very positive uplift for B2B, is that sustainable? And then there is protest in the country plus the fate of The 3rd operator DigiCell on that country? Speaker 800:40:46Thank you. Speaker 300:40:48Sure. I'll answer these questions and then I'm going to ask Chris to jump in as well On the guidance, as Chris pointed out, there's 2 things. 1, this whole migration thing, we may end up spending more on headsets. We're going to be very flexible on it. Right now, the reason we're not changing the guidance, we think we're going to hit it, but there's a few things and we thought we ought to like Just give everybody a heads up. Speaker 300:41:121, the equipment and 2, as Chris highlighted in Panama, we have a very large B2B customer that At the end, a lot of your bills are get paid in the months of November December. And we see light at the end of the tunnel, but We thought maybe we should highlight that. If that doesn't come in, it will come in, in January. It's just a timing issue. And Chris will give you more color on that. Speaker 300:41:36In Panama, the business itself, the B2B business, that's where a lot of the growth our B2B business there, it's about 2 thirds monthly recurring and 1 third Non recurring revenue. And a lot of the non recurring revenue comes in, in the 3rd Q4, a lot of government contracts, large enterprise contracts. And we close those deals usually in the second half of the year and then we ride it the following year. And every year, it's kind of like the same cadence that way. And but we feel fairly confident. Speaker 300:42:05It's about a $300,000,000 business to B2B. I don't know if we break that segment out, but I'll tell you it's about a $300,000,000 B2B business, it's about $100,000,000 of NRR and our sales team there led by actually one of our best salesperson And that team delivers every year. So I'm not that worried about the variability Of that business on the B2B segment. On the protest, it is what it is. In Panama, it has impacted us a bit. Speaker 300:42:37Our shops have been closed. 1 of our key shops have been closed. A number of our other shops, the foot traffic have dropped quite a bit. And as you know, in these regions, a lot of our sales happens at the retail level, and happens at the door to door level as well. So a lot of these protests have kind of cramped in a little bit. Speaker 300:42:57But I did check on our sales. We go through our sales numbers every week. And sales, while it slowed down our backlog installs have been increasing. So as soon as this process is done, the installs Gets out there and we should recover. So it's a temporary blip with the protest. Speaker 300:43:18I don't expect much of a hit to us financially. With that, I'll pass to Chris. Maybe just Speaker 900:43:27a little bit color as to the potential headwind we would see in particular around the delay in the migration. There's kind of 2 key points. One is the There's kind of 2 key points. One is the inventory. Since we have both our new stack, which is Getting up and running and then we have the AT and T platform. Speaker 900:43:48We basically have double handset inventory than one would Normally, Carey, going into the holiday season. And then second, we have obviously monthly TSA costs and additional costs Related to the migration. I mean, I would say just conceptually the headwind around that would be greater than sort of $30,000,000 on the free cash flow side, but we are working hard driving our businesses across the group Continue to produce and strive to meet our target that we had given at the start of the year. Speaker 500:44:27Thanks, Chris. Speaker 800:44:29Thank you. Very careful gentlemen. Thank you very much. Speaker 300:44:36Sorry, we missed that. Operator00:44:40Thank you. Our next question go to Sumit Datta of New Street Research. Speaker 700:44:54And then also, I don't think we got an answer on the Puerto Rican mobile conversation. I'd be interested if you could So back on that. So I think that was a previous question. But just first of all, on just thinking about free cash flow Looking into next year, I think, Balan, you mentioned the $70,000,000 of synergies in Puerto Rico is still intact. But as we look forward, should we think about those synergies layering in from here as well as Some of the kind of extra costs we've seen at the moment falling away. Speaker 700:45:30So is the uplift kind of €70,000,000 plus a little bit more? And then secondly, as well kind of looping into the same theme, how much of the synergies are now Coming through in Panama, so how much more can we think about coming in from that market as well? Just trying to get a feel for What sort of cash flow uplift we can think about on a run rate basis once this integration process is completed, please? That's the first question. I'll maybe come back in a second. Speaker 300:46:05Sure. I'll come back to the PR mobile. But On the free cash flow, I don't anticipate us changing our synergy guidance on Puerto Rico. It would be about $70,000,000 annualized Clearly, next year because of the bleed in costs, we'll probably not see the full $70,000,000 next year. In Panama, the incremental synergies is not that significant anymore going forward. Speaker 300:46:30So you'll see the synergies that we've captured a lot this year. Next year, there's an incremental I'm going to try the number like $5,000,000 or so, probably won't exceed $10,000,000 next year Over and above what we've captured this year. That's the number on top of my head for my last reviews. On Puerto Rico Mobile, yes, that was the question. So we actually feel Pretty good about it. Speaker 300:46:58We've said there's 2 things that happened there. At the end of last year when T Mobile really went aggressive on their subsidies, I mean, they were offering iPhone 14, AirPods. They were paying $600,000,000 sorry, dollars 600 to buyout contracts. We had matched it through the end of last year. And of course, Chris and I were Not very happy with the free cash flow implications of matching that. Speaker 300:47:27So in the first half of this year, we kind of slowed down the subsidies. And subsequently, you can see that our net adds came flat. This is just a little right flat, just slightly Sounds good, but kind of noise. So you can say it's just flat. And then what happened in the second half of this year We did a number of changes in our executive team in Puerto Rico on the product side. Speaker 300:47:54And so we've been looking at it through a new lens. And with the iPhone 15, we've come back into the subsidy game quite aggressively, Both on the iPhones as well as non Apple devices as well. And my sense is next year, you're going to see Forcepaid do better. You're going to see prepaid do better as well. We just launched a new prepaid Promotion that I think will capture attention. Speaker 300:48:24It's a 4 by 20 plan. You get 4 lines, dollars 20 each. It's very impressive. And the reason we couldn't do some of these things before is we didn't have our own IT stack. So I did indicate earlier that in January, we'll On postpaid, we will exclusively sell on our own postpaid stack. Speaker 300:48:42But on the prepaid side, we stood that up already. So as of last Sweet. We can just do whatever we promotions we want. And so we're going to get aggressive in the prepaid. And as you look at our mobile business and the number And the lines that we've lost, most of it's on the prepaid side. Speaker 300:48:59So this will now show up the prepaid with the Boost transaction with DISH, Which we should close sometime next year. That will give us more channels on the prepaid. So we feel like the prepaid will get back to a good place. And then on the postpaid side, we're back in the subsidy gain. The returns are actually quite good on that. Speaker 300:49:18We've kind of stretched it in a way that I think works really well for us. So we'll get back into the capture business. And you should look at this In 2024 and 2025, after we have our own stack running on our own network that we will be the attacker in Puerto Rico. And that's Mobile Slate going forward. Speaker 700:49:47Just on the tower deal, that's a great deal, which has just been announced. Could you give any you said it was a great free cash flow multiple. Any kind of steer as to what The multiple will be what sort of free cash flow will kind of fall out as a result of that transaction? And I just wondered, are there more towers To come or is there potentially sort of other infrastructure you're looking to monetize at this time as well? Thanks very much. Speaker 300:50:15I'll answer the last question first. No, we're not looking at any other infrastructure to monetize at this point. Of course, you know we will be very opportunistic, but That's not what we're looking at. This tower deal is we kind of like bundled up a lot of the towers that we thought we should But in this day, days and any more towers, what we thought we should transact is included in this whole cohort. And we feel really good about it. Speaker 300:50:40I'm glad you asked the The press release went out right before the call. Literally, we were closing the final points in the deal Until like 5 this morning, 5:30 and then about 6 o'clock still getting some governance issues resolved. And That's why he was very late on the press release coming out. But we are really excited about it. You asked about the multiple. Speaker 300:51:06We agreed with the sale sorry, with the buyer that we wouldn't talk too much about the multiples. But you can imagine it's highly accretive. It's very happy with it. The headline price and is that The EBITDA Chris or John, can I start by the EBITDA numbers? No. Speaker 300:51:27Okay. Just checking my General Counsel. Yes. We probably won't say the EBITDA hit on it, but you can clearly imagine it's not that significant. Speaker 700:51:40Great. Okay. Thank you. Speaker 300:51:44Yes. We are excited about it, Sumit. That tower deal is a good one. Operator00:51:50Thank you. And our next question goes to Matthew Harrigan of Benchmark. Matthew, please go ahead. Your line is open. Speaker 1000:51:59Thank you. Speaking of good ones, per megahertz pop price On the Spectrum transaction with DISH, it seems really good, especially for that quality of Spectrum. I know it would be a discount to the U. S, but you really If you take out the 120,000 mobile customers, you're also getting it looks like it was just a really good deal for you. Could you elaborate a little bit more on the pricing and the input for Puerto Rico relative to the states? Speaker 1000:52:29Thank you. Speaker 300:52:31Sure. Puerto Rico always trades in the auctions. There's a slight discount Again, it's Mainland. For a couple of reasons. 1, the potential buyers there are limited. Speaker 300:52:442, it's kind of a captive market there. And so it's always traded at a slight discount because it's easy to build a lot more towers there As opposed to just relying on spectrum. Now having said that, the team has done a tremendously good job. I think it's a win win for both us and DISH On that, it's quite accretive for them, accretive for us. It's accretive for them because they don't have to build out in Puerto Rico. Speaker 300:53:09We are going to take on the build out over in Puerto Rico. And so it saves them a lot of CapEx that they can focus in Mainland. Our General Counsel was at the SEC yesterday at the Justice Department and did a tremendous job explaining The rationale for the deal together with the executives from DISH. And so we feel positive about it. I think it's a good deal for DISH. Speaker 300:53:38It's certainly a good one for us as well. It shows 2 things. 1, our confidence in Puerto Rico. And secondly, T Mobile is this huge humongous company, 30 times our size Then we're going to go up head to head with those guys with them day in, day out. We are all in, in Puerto Rico in mobile. Speaker 1000:54:01Great. Thanks, Paul. Operator00:54:07Thank you. That will concludes today's question and answer session. I'd like to hand back to Balan Mayer for any additional or closing remarks. Speaker 300:54:17Thank you, operator. You can clearly see I am very happy. I'm very happy with the Good earnings results for this quarter. And I think the growth that you see here, It's really good. I think Q4 is looking pretty good as well. Speaker 300:54:40And then next year, as we go into next year, we'll go in with a base of EBITDA And revenue that I think we can build nicely on as well. The business is in good place. I know there will be a lot of concerns about Puerto Rico And it's a phase. We'll get through the migrations. The network has stood up. Speaker 300:54:58It's running really well. The IT stacks have stood up. We need to finish the migration. We get off the cost in a year, and nobody will remember about the migration And all that. And this is fundamentally a really strong good business. Speaker 300:55:13The fixed network is growing really well. Prepaid Speaker 700:55:17business is going to grow. Speaker 300:55:18Postpaid business, I think our plans are really good. The Spectrum acquisition we just made, the prepaid business we just bought, I think we're going to put Puerto Rico in a good place. So between that in a good place, our C and W business operating really well, Panama on to big and better things, Costa Rica is doing really well. Liberty Networks is doing really well. I think we've got a good franchise here and I'm really excited about it. Speaker 300:55:45So thank you so much for all your support and have a great day. Operator00:55:53Thank you, ladies and gentlemen. This concludes Liberty Latin America's Q3 2023 Investor Call. As a reminder, a replay of the This 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 all for joining. Operator00:56:14You may now disconnect your lines.Read morePowered by