Liberty Broadband Corp (LBRDK) 2023 Q2 法說會逐字稿

Welcome to the Liberty Broadband 2023 Q2 earnings call. (Operator Instructions) As a reminder, this conference will be recorded August 4. I would now like to turn the call over to Shane Kleinstein, Vice President, Investor Relations. Please go ahead.

歡迎參加 Liberty Broadband 2023 年第二季度財報電話會議。 （操作員說明）謹此提醒，本次會議將於 8 月 4 日進行錄製。我現在想將電話轉給投資者關係副總裁 Shane Kleinstein。請繼續。

Thank you, and good morning. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent Forms 10-K and 10-Q filed by Liberty Broadband and Liberty TripAdvisor with the SEC.

謝謝你，早上好。在開始之前，我們想提醒大家，本次電話會議包含1995 年《私人證券訴訟改革法案》含義內的某些前瞻性陳述。由於許多風險和不確定因素，實際事件或結果可能會存在重大差異，包括Liberty Broadband 和 Liberty TripAdvisor 向 SEC 提交的最新 10-K 和 10-Q 表格中提到的內容。

These forward-looking statements speak only as of the date of this call, and Liberty Broadband and Liberty TripAdvisor expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Liberty Broadband or Liberty TripAdvisor's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

這些前瞻性聲明僅代表本次電話會議之日的情況，Liberty Broadband 和Liberty TripAdvisor 明確表示不承擔任何義務或承諾傳播本文中包含的任何前瞻性聲明的任何更新或修訂，以反映Liberty Broadband 或Liberty 的任何變化TripAdvisor 對此的期望或任何此類聲明所依據的事件、條件或情況的任何變化。

On today's call, we will discuss certain non-GAAP financial measures for Liberty Broadband, including adjusted OIBDA. Information regarding the comparable GAAP metrics, along with required definitions and reconciliations, including preliminary notes in schedules 1 and 2, can be found in the earnings press release issued today as well as earnings releases for prior periods, which are available on Liberty Broadband's website.

在今天的電話會議上，我們將討論 Liberty Broadband 的某些非 GAAP 財務指標，包括調整後的 OIBDA。有關可比GAAP 指標的信息，以及所需的定義和調節，包括附表1 和附表2 中的初步說明，可以在今天發布的收益新聞稿以及前期收益發布中找到，這些信息可在Liberty Broadband 網站上找到。

Now I'd like to introduce Greg Maffei, Liberty's President and CEO.

現在我想介紹一下 Liberty 總裁兼首席執行官 Greg Maffei。

Thank you, Shane. Good morning. Today speaking on the call, we will have Liberty Broadband's Chief Accounting Officer and Principal Financial Officer, Brian Wendling; Ron Duncan, CEO of GCI and Pete Pounds, CFO of GCI, will also be available to answer questions. Also during the Q&A, we will be available to answer questions related to Liberty TripAdvisor.

謝謝你，謝恩。早上好。今天，Liberty Broadband 的首席會計官兼首席財務官 Brian Wendling 將在電話會議上發言。 GCI 首席執行官羅恩·鄧肯 (Ron Duncan) 和 GCI 首席財務官皮特·龐茲 (Pete Pounds) 也將出席並回答問題。此外，在問答期間，我們還將回答與 Liberty TripAdvisor 相關的問題。

So starting with Liberty Broadband. We remain under the 26% fully diluted ownership cap due to lighter buybacks and their annual issuance of equity awards at Charter. We have not sold into the buyback since January. We do plan to resume LBRDA and LBRDK buybacks using substantially all of our after-tax proceeds from Charter sales once they resume their buyback.

所以從自由寬帶開始。由於回購力度較小以及每年在 Charter 上發行股權獎勵，我們的完全稀釋所有權上限仍保持在 26% 以下。自一月份以來我們就沒有進行過回購。我們確實計劃在 LBRDA 和 LBRDK 恢復回購後，使用我們大部分包機銷售的稅後收益來恢復回購。

Charter, looking at it, strong operating results, 77,000 broadband net adds and 648,000 wireless net adds benefiting from the conversion strategy of Spectrum One. Charter is now about 30% of all the postpaid industry wireless net adds and cable in total is about 47%. The rural expansion is going well at Charter, pacing with 26,000 subsidized world subscribers added. That was 1/3 of our total broadband net adds coming from the subsidized world builds.

從 Charter 來看，運營業績強勁，寬帶淨增 77,000 戶，無線淨增 648,000 戶，受益於 Spectrum One 的轉換策略。目前包機約佔所有後付費行業無線網絡新增的 30%，有線網絡約佔 47%。 Charter 的農村擴張進展順利，全球新增 26,000 名受補貼用戶。我們的寬帶網絡新增總量的 1/3 來自補貼的世界建設。

We do expect progress on the investments we've made and easing cost pressures in the back half of 2023 to really reaccelerate growth. 2023 is an investment year and we did see modest financial growth in the quarter as expected due to that. There remains pressure in the video income system, which is impacting our top line, but not impacting EBITDA as much. Charter management is executing well on all pillars of its strategy, and we are pleased with their progress. The employee retention initiatives they've undertaken approved successful with better sales yields, retention and customer service. We are on track for 300,000 rural passings constructed in 2023, and the network evolution and physical upgrade plans are on track as well. 45% of our customers are now receiving our advanced WiFi product.

我們確實預計我們的投資將在 2023 年下半年取得進展並緩解成本壓力，從而真正重新加速增長。 2023 年是投資年，因此我們確實看到了本季度的適度財務增長，正如預期的那樣。視頻收入系統仍然存在壓力，這影響了我們的營收，但對 EBITDA 的影響不大。包機管理在其戰略的所有支柱上都執行良好，我們對其進展感到滿意。他們採取的員工保留計劃取得了成功，取得了更好的銷售收益、保留率和客戶服務。預計2023年建設30萬個農村通行證，網絡演進和物理升級計劃也已步入正軌。我們 45% 的客戶現在正在接收我們先進的 WiFi 產品。

Turning to TripAdvisor. We believe the long-term trends and travel experiences will benefit the business and will continue. Recent growth has continued to be led by strength of experiences. Viator revenue was up 59% year-over-year. We are focused on growing the brand awareness of Viator and building a cost-efficient customer acquisition channel, which we believe is entirely doable and will continue to increase profitability over time. And we continue to evaluate ways to better highlight the value of Viator.

轉向 TripAdvisor。我們相信長期趨勢和旅行體驗將使業務受益並將持續下去。最近的增長繼續由豐富的經驗引領。 Viator 收入同比增長 59%。我們專注於提高 Viator 的品牌知名度並建立具有成本效益的客戶獲取渠道，我們相信這是完全可行的，並將隨著時間的推移繼續提高盈利能力。我們將繼續評估如何更好地凸顯 Viator 的價值。

There are -- we are working through the challenges in metasearch while carefully managing costs. TripAdvisor announced cost reductions recently, most recently targeted at the TripAdvisor core and corporate functions. We are investing in strategic initiatives to build deeper engagement with travelers and diversify our monetization schemes. We are leveraging AI, we have upgraded our trip planning tools built on trips proprietary data using AI, and we are augmenting our content offering both -- with both user-generated plus editorial content, leveraging that AI as well. And we have other initiatives underway to drive increased engagement and membership sign-in.

我們正在努力應對元搜索的挑戰，同時仔細管理成本。 TripAdvisor 最近宣布了成本削減，最近的目標是 TripAdvisor 核心和企業職能。我們正在投資戰略舉措，以與旅行者建立更深入的互動，並使我們的貨幣化計劃多樣化。我們正在利用人工智能，我們使用人工智能升級了基於旅行專有數據的旅行規劃工具，並且我們正在利用人工智能來增強我們的內容，包括用戶生成的內容和編輯內容。我們正在採取其他舉措來提高參與度和會員登錄率。

And with that, I'll turn it over to Brian for the details.

這樣，我會將其轉交給布萊恩了解詳細信息。

Thank you, Greg. Let's take a quick look at Broadband's balance sheet. At quarter end, Liberty Broadband had consolidated cash and cash equivalents of $81 million, which includes $60 million of cash at GCI. As of the end of the day, yesterday, the value of our Charter investment was $19.9 billion, and at quarter end, Liberty Broadband had a total principal amount of debt of $3.8 billion. Note that this excludes the preferred stock and remaining indemnification obligation to Qurate.

謝謝你，格雷格。讓我們快速瀏覽一下寬帶的資產負債表。截至季度末，Liberty Broadband 的合併現金和現金等價物為 8100 萬美元，其中包括 GCI 的 6000 萬美元現金。截至昨天收盤，我們的 Charter 投資價值為 199 億美元，截至季度末，Liberty Broadband 的債務本金總額為 38 億美元。請注意，這不包括優先股和對 Qurate 的剩餘賠償義務。

As Greg mentioned, we have not sold into Charter's buybacks since January. We do expect to resume share sales to Charter at some point this year to maintain our fully diluted ownership of 26% for our stockholders agreement. However, due to less buyback activity, we would expect lower tax leakage on our future Charter sales this year compared to the previously estimated range of 7% to 9%.

正如格雷格提到的，自一月份以來我們就沒有出售查特的回購股票。我們確實預計在今年某個時候恢復向 Charter 出售股票，以根據股東協議維持我們 26% 的完全攤薄所有權。然而，由於回購活動減少，我們預計今年未來包機銷售的稅收洩漏將低於之前估計的 7% 至 9% 範圍。

Taking a quick look at GCI. GCI had a solid second quarter. Revenue and adjusted OIBDA were up $7 million and $2 million, respectively. Revenue growth was driven by continued strength in data sales, particularly to RHC and school customers. This was partially offset by continued declines in our video business, which impacts revenue but does not have a meaningful impact on margin or free cash flow. Adjusted OIBDA grew less than revenue due to inflationary pressures, primarily in labor and personnel-related expenses. Over the last year, GCI has added 5,700 revenue-generating wireless subscribers and 4,000 revenue-generating cable modem customers.

快速瀏覽一下 GCI。 GCI 第二季度表現強勁。收入和調整後的 OIBDA 分別增長 700 萬美元和 200 萬美元。數據銷售的持續強勁推動了收入增長，尤其是針對 RHC 和學校客戶的數據銷售。這被我們視頻業務的持續下滑所部分抵消，這影響了收入，但對利潤率或自由現金流沒有產生有意義的影響。由於通貨膨脹壓力（主要是勞動力和人事相關費用），調整後的 OIBDA 增長低於收入。去年，GCI 增加了 5,700 個創收無線用戶和 4,000 個創收有線調製解調器客戶。

Solid performance has allowed GCI to continue making distributions up to Liberty Broadband. Subsequent to quarter end, GCI paid a $25 million dividend to Liberty Broadband using cash on hand, and we anticipate additional dividends will be paid this year. Year-to-date, Broadband has received $65 million in dividends from GCI. Leverage as defined in its credit agreement was 2.95x as of quarter end and GCI has $397 million of undrawn capacity under it's revolver.

穩定的性能使 GCI 能夠繼續發行直至 Liberty Broadband 的產品。季度末後，GCI 使用手頭現金向 Liberty Broadband 支付了 2500 萬美元的股息，我們預計今年還將支付額外股息。今年迄今為止，Broadband 已從 GCI 獲得了 6500 萬美元的股息。截至季度末，其信貸協議中定義的槓桿率為 2.95 倍，GCI 的循環賬戶下有 3.97 億美元的未提取能力。

And then just a quick update on 2 litigation settlement matters. During the second quarter, GCI paid the previously accrued $41 million settlement to the FCC and DOJ resolving that long-standing inquiry regarding the RHC program. And additionally, during the second quarter, Liberty Broadband paid the previously accrued $38 million settlement related to a 2015 lawsuit. More information on both these matters is available in our 10-Q, which will be filed shortly.

然後簡單介紹一下 2 起訴訟和解事宜。第二季度，GCI 向 FCC 和 DOJ 支付了之前累積的 4100 萬美元和解金，解決了有關 RHC 計劃的長期質詢。此外，在第二季度，Liberty Broadband 支付了之前與 2015 年訴訟相關的 3800 萬美元和解金。有關這兩個問題的更多信息可在我們即將提交的 10-Q 中找到。

And with that, I'll turn the call back over to Greg.

然後，我會將電話轉回給格雷格。

Thank you, Brian. And to our listening audience, we appreciate your continued interest in Liberty Broadband and Liberty TripAdvisor. Our Annual Investor Day will be Thursday, November 9 in New York City. Please save the date, additional details will be provided soon. We hope to see many of you there. And with that, operator, we'd like to open the line for questions.

謝謝你，布萊恩。對於我們的聽眾，我們感謝您對 Liberty Broadband 和 Liberty TripAdvisor 的持續關注。我們的年度投資者日將於 11 月 9 日星期四在紐約市舉行。請保存日期，我們將很快提供更多詳細信息。我們希望在那裡見到你們中的許多人。接線員，我們希望開通提問熱線。

(Operator Instructions) Our first question comes from Michael Rollins with Citi.

（操作員說明）我們的第一個問題來自花旗銀行的邁克爾·羅林斯（Michael Rollins）。

Just curious on the Liberty Broadband side, any new perspectives on the opportunity for Liberty Broadband to close some of the NAV discount relative to the value of the Charter stake and the other assets, GCI and the other assets that you own?

只是對 Liberty Broadband 方面感到好奇，對於 Liberty Broadband 關閉相對於 Charter 股份和其他資產、GCI 和您擁有的其他資產的價值的部分資產淨值折扣的機會，有什麼新的看法嗎？

Yes. Thank you for the question. Look, we are always interested in trying to maintain the smallest discount possible, but when presented with the discount, we are going to try and take advantage of it. And we believe with the cash flows that we are going to be generated from Charter to us, we will be able to repurchase shares at an attractive rate. Over the long term, we'll see how that narrows and when becomes most logical as it probably will at some point to combine Liberty Broadband at Charter, but we have no current plan or intent.

是的。感謝你的提問。看，我們總是有興趣嘗試保持盡可能小的折扣，但是當提供折扣時，我們將嘗試並利用它。我們相信，憑藉特許經營所產生的現金流，我們將能夠以有吸引力的利率回購股票。從長遠來看，我們將看到這一範圍如何縮小，以及何時變得最合乎邏輯，因為它可能會在某個時候將 Liberty Broadband 與 Charter 合併，但我們目前沒有計劃或意圖。

Operator, I believe we have no more questions. So with that, again, thanks to our listening audience. Appreciate your interest in Liberty Broadband and Liberty TripAdvisor. We hope to see you next quarter, if not sooner. Thank you.

接線員，我相信我們沒有更多問題了。再次感謝我們的聽眾。感謝您對 Liberty Broadband 和 Liberty TripAdvisor 的關注。我們希望在下個季度（甚至更早）見到您。謝謝。

Thank you. All parties may disconnect.

謝謝。所有各方都可以斷開連接。