Liberty Global (A) [LBTYA] Conference call transcript for 2022 q4
2023-02-23 16:21:05
Fiscal: 2022 q4
Operator: Good morning, ladies and gentlemen, and thank you for standing by. Welcome to the Liberty Global Fourth Quarter 2022 Investor Call. This call and the associated webcast are the property of Liberty Global and any redistribution, retransmission or rebroadcast of this call or webcast in any form without the express written consent Liberty Global is strictly prohibited. At this time, all participants are in listen-only mode. Today's formal presentation materials can be found underneath the Investor Relations section of Liberty Global's website at libertyglobal.com. After today's formal presentation, instructions will be given for a question-and-answer session. Page two of the slides details the company's Safe Harbor statement regarding forward-looking statements. Today's presentation may include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including the company's expectations with respect to its outlook and future growth prospects and other information and statements that are not historical fact. These forward-looking statements involve certain risks that could cause actual results to differ materially from those expressed or implied by these statements. The risks include those detailed in Liberty Global's filings with Securities and Exchange Commission, including its most recent filed forms 10-K and 10-Q as amended. Liberty Global disclaims any obligation to update any of these forward-looking statements to reflect any change in its expectations or in the conditions of which any such statement is based. I would now like to turn the call over to Mike Fries. You may now proceed.
Mike Fries: Okay. Welcome, everyone, and thanks for joining our year-end results call. I hope you're all doing well. As usual, we have some prepared remarks that Charlie and I will manage and then we'll get right to your questions. And for that, I'll bring in my key leaders who will be ready to respond as needed. We're working off slides, as we usually do and they contain quite a bit of good information this time. So we'll assume you've got those in front of you or you'll access them at some point. Just a warning, this is our year-end call, so there's a bit more information than usual, but bear with us, we'll try to keep it crisp. I'll begin on slide three with some highlights for the quarter and the full year. And I have to start by saying that I'm extremely proud of my team in each of our operating businesses for how they executed through a challenging year. And just when we thought things were getting better, Europe was hit with a war in Ukraine, rising energy costs, record inflation and cost of living crisis that impacted customers really across the region. But despite these headwinds, we hit or exceeded all 16 guidance metrics for our big FMC operating companies that we established a year ago and we beat our forecast for distributable cash flow at the Liberty Global level by $100 million, and that's using guidance FX. So this is the third year in a row that we were faced with external uncertainty, but still managed to deliver on our public targets. Second, and perhaps not surprisingly, Q4 was a very strong quarter for us across the board and we delivered positive broadband and postpaid additions in every market, fueled by convergence offerings and Black Friday campaigns. And our largest operation Virgin Media O2 delivered their best financial result yet, with a double-digit EBITDA growth figures, supported by price adjustments synergies and net adds. And then third, we continue to benefit from consistent and steady revenue growth in our three most important segments, which are B2B, broadband and mobile. And just as importantly, we're actively addressing headwinds in our B2C fixed businesses more broadly, with smart network and product innovation and I'll dig into both of these topics in a moment. And then fourth, we've maintained a clear and consistent approach to capital allocation. In 2022, we bought back 40% more stock than we guided to, a total of $1.7 billion or 14% of the shares outstanding. And we're on track for at least another 10% this year. And in a few slides I'll expand a bit on how we see our capital allocation framework going forward. And then, finally, I'll let Charlie cover the details of our guidance, but I'll just highlight upfront that despite continued investment in fiber 5G and digital. This year we expect to generate another $1.6 billion in distributable cash flow in 2023. So a strong year for us operationally and financially and as we'll discuss in a moment we're well positioned to drive value for shareholders moving forward. Slide 4 is our standard schedule showing Connectivity Trends for our four large FMC Opco's over the last five quarters. One quick observation is that for the first time in over five years every market experienced positive broadband and postpaid mobile net adds in the fourth quarter. The top left shows VMO2, which has delivered three straight quarters of sequential growth in both broadband and postpaid net adds, despite intense competition and the cost of living pressures in the U.K. Broadband speed upgrades together with strong momentum from our Volt bundle drove our best broadband quarter of the year. By the way we outperformed BT again and we garnered an even higher share of national gross adds than we did a year ago. Q4 also saw strong pickup in postpaid net adds in what it is always an important trading period for mobile. And the O2 brand continues to perform very well, especially at the top end of the market with sector-leading churn well below 1%. Now Sunrise in Switzerland also had a strong fourth quarter with 53,000 broadband and postpaid adds. Importantly, after two quarters of losses in Switzerland we delivered positive broadband growth, helped by a strong Black Friday period focus on one gigabit offers and a new Netflix bundle we put into the market. This was a particularly good performance, given the continued higher churn we've experienced related to the UPC brand migration that we flagged really mid-year last year. Now in postpaid, Sunrise delivered another strong quarter with 34,000 adds supported by the Sunrise brand refresh and interestingly our SwissSki's sponsorship which is off to a great start now that the Ski season is fully underway. After nine quarters of broadband losses Vodafone Ziggo delivered 7,000 net adds in Q4 in-part, supported by its Ziggo Sprinters and Black Friday campaigns. Look at the Dutch market remains highly competitive with price and quality of service now becoming more important than fiber. When you look at customer churn, incidentally KPN lost broadband subs in the quarter. Vodafone Ziggo's 26,000 postpaid adds were negatively impacted by the loss of some corporate accounts, but were still higher than KPN in the quarter. It's also interesting that T-Mobile took some pricing in January up 9%. And then finally Telenet added 13,000 broadband and postpaid adds which was largely consistent with prior periods and postpaid mobile adds were steady, supported by their bundles and it's really strong performance from the base brand, so, solid execution across all of our markets in broadband and mobile. And slide 5 is also becoming a standard chart for us, showing revenue growth across the four main FMC Opco's and then broken down by revenue segment. So there's five key takeaways here. First, if you look at the total revenue growth for each FMC Opco, you'll see that revenue remained resilient with broadly stable to positive trends across the group. As you move down the chart however, you'll see that consumer fixed revenue as a whole is consistently negative, from negative 1% to negative 4%. And that's impacted by losses in video and voice RGUs something you're well aware of as well as pressure on ARPUs and mix during this cost of living crisis. But interestingly, while we continue to lose video subs at a rate third of what's happening in the U.S. video is now only about 15% of our revenue. Now, I'll spend a moment on how we're addressing the headwinds in FIXED on the next slide. Now embedded in this FIXED B2C result are broadband revenues which continue to grow albeit modestly and will increasingly become a larger and larger part of the FIXED consumer story in every market. And then third, revenue growth in consumer mobile is all green, across the board driven largely by service revenue which is growing 2% to 4% across the group. This is a function of strong postpaid additions of course, and price adjustments through the year. And then fourth, B2B remains a growth engine across all assets with revenue increasing 1.5% to 4% and significant upside as we expand our reach and market share. And then finally, as the pie charts at the bottom make clear, we have a highly diverse and arguably defensive revenue mix with mobile both B2C and B2B, now representing almost half our turnover and B2B itself comprising 20% to 25% of revenue. Slide 6 dives a bit deeper into our fixed consumer business and how we're addressing some of the headwinds today. I'll start by showing fixed ARPU trends on the top left, which as you can see have been relatively stable in Belgium and Holland even slightly up. With both markets bidding down, price rise as well and dealing with limited front-book, back-book dynamics. In the UK, in Switzerland however, we've seen around a 3% decline in fixed ARPU related partly to the fact that we start with fairly higher ARPUs in each market and then that's compounded in the UK by declining video voice and cost of living pressures. And then Switzerland as we discussed we're managing through a migration from UPC to Sunrise, which has impacted ARPU. So what are we doing here? First of all, we're taking price increases on fixed. You know that around 14% in the UK and mid-single digit in Belgium and Holland and those are outlined on the bottom left you can see what we've done. Secondly, we're implementing a number of commercial initiatives that are critical here. By far the most important is our broad convergence strategy, which as we've demonstrated helps improve churn, NPS and cross-sell opportunities. We've talked about it before in Holland. FMC households have on average 20 points higher NPS and 50% less churn. These are real theoretical benefits to the fixed base as we converge. We've also invested significant effort into integrating streaming apps into our video platforms. Netflix for example is bundled in just about every market and we're increasingly able to add these subscriptions to our bill. We're also focused on rolling out all IP and at first video devices across our markets. In the UK for example, we're now adding video subscribers, not losing video subscribers actually adding video subscribers in January as a result of our Stream TV launch. And then our investments in digital are reducing friction and cost in the fixed consumer business. The tools we're rolling out are driving more online sales, reducing call center interactions, improving self-install rates and driving cross-sell opportunities. And then finally, we're making good progress on new revenue streams. And these include things like home security or telehealth and energy. We've rolled out products just like this in most markets, and we intend to continue to take advantage of our customer relationships and digital platforms to widen our revenue lens and find new areas of growth. Certainly a significant part of our plans to keep growing broadband and improving our fixed consumer business relates to our fixed network investment strategies in every market, which we provide an update on in Slide 7. It's also important to remind folks that we are the broadband leader today in Europe, with over 31 million gigabit homes ready for service. And just as importantly, we have a clear path to 10 gigabit speeds in every market, with mostly creative structures, really creative structures that will ensure we're optimizing CapEx intensity. So the chart on the bottom left shows you that by 2028, we'll be 70% fiber to the home across what will then be a 36 million home footprint. Now that excludes whole buy arrangements in markets like Switzerland and Ireland, that add another 4 million fiber home takes us to $40 million and brings that fiber percentage to 75%. So we could be as many as 40 million homes by 2028. That's good organic greenfield growth. And our plans to get there are summarized on the right. You're familiar with our approach in the UK. We added or upgraded 1 million fiber homes in 2022 and that will accelerate by at least 50% in 2023. Again, most of that CapEx, especially the new build CapEx is being invested through our JV with Telefónica and InfraVia so off balance sheet. In Belgium, we've announced the deal with Fluvius, you're aware of that to build fiber across Flanders in a NetCo-ServCo structure that to close this summer. And in the meantime, we've agreed a reciprocal wholesale access deal with Orange that ensures that Telenet is the undisputed leader in the north with 70%-plus utilization and also capable of entering the sale. We completed our one-gig upgrade in Holland last year. And in Switzerland, as you know, we're going to use a hybrid approach with DOCSIS, fiber and whole buy. And then finally, Ireland will be our first market to launch wholesale services on our own fiber network in 2023 and that's after announcing a wholesale agreement with Vodafone. So we have a sound and we think, efficient set of plans in every market to remain the speed and quality leader in fixed connectivity and you should expect that we'll keep you posted on progress here every quarter. Now moving to slide 8. We decided to hit the valuation question head on this quarter. So if you back off and split your eyes a little bit, this might look like a complicated slide but it's really quite simple. The purpose here is to help decipher, the valuation gap in our stock a bit and focusing on our FMC opco. So, one way to look at our current market valuation is to break it down into three parts, as we've done on the left side of the chart. So assuming full value for our cash balance and our ventures portfolio, the implied valuation of our FMC opcos at the $21 price level, is roughly 5.5 times EBITDA and around 13 times operating free cash flow, using our actual and reported figures for 2022. And by the way, cash is cash and our venture investments are conservatively marked. They're held in very tax efficient structures and we've already returned over $500 million to the parent. Interestingly, the free cash flow yield at $21, once you reduce the market cap by ventures and cash, is well over 30%. Now moving to the middle of the slide, the analyst community has an average price target on our stock of $30. That implies a 40% premium to our current market price of $21 to run the same math and attributing all of that premium to the FMC telcos, resulted in an EBITDA multiple of around 6.5% and an operating free cash flow multiple of about $14.5 million. By the way, our peer group trades between 6.5% and 7.5% and some as high as 8.5 times EBITDA. The free cash flow yield at $30, by the way, is still compelling at around 15%. So while our peers would be really mid to high-single-digits. And the analysts correctly cite in our view, a handful of narratives to support their price targets, right? And this includes things like telco sector tailwinds in Europe, where we can now have pricing power. Market rationalization and mobile revenue growth and regulatory relief and we agree with that. But their arguments also typically include three other drivers, like the benefits we're realizing from a sub base that is now 50% converged or the expectation of continued and on-target synergy realization in the UK and Switzerland, and the inherent free cash flow profile of our businesses, especially given that we believe we're in a peak CapEx period right now. So I guess the message is that $30 doesn't seem like a big stretch to us. One of the reasons is that we don't believe analysts have captured all of the drivers that in our view support a premium market valuation. We don't specifically quantify what a premium market price looks like. Our lawyers wouldn't let us do that. But we do identify the key elements that should support values well above our stock price, and perhaps even twice the analyst price target. And those are summarized on the right-hand side of the slide. To begin with, we have been on the receiving end, as most of you know, of six private market transactions in the last six years where EBITDA multiples were as high as 12% and OFCF multiples exceeded 20%. Now admittedly, synergies did factor into some of those valuations but these were subscale cable TV operations, not fully converged FMC champions. You can run your own numbers. But in today's environment, we believe eight to 10 times EBITDA in 18 to 20 times operating free cash flow are not unrealistic multiples and are based -- if you look at historical transactions for high-quality FMC businesses in Europe. In addition, there are a handful of other value drivers that we believe would support a premium valuation that analysts don't cover. First, we've gone to great lengths to build true national champions that are shaping the market structure in every country we operate in. Secondly, we have embedded infrastructure upside in the form of towers as well as our fiber networks that's not recognized. Third, we're only beginning to realize now the benefits from new revenue streams like security, gaming and telehealth all of which we've launched. And finally, we are arguably at peak CapEx levels this year, which will result obviously in even greater long-term cash conversion. We add to this equation our unique approach to value creation that relies on agile capital allocation the leverage, but derisked balance sheet and the commitment to buybacks you've got a winning combination. So building on that last point about our levered equity model Slide 9 digs a bit deeper into our capital allocation framework and we know this differentiates us from our peers. It all begins with shareholder remuneration, which we show graphically on the left-hand side of the slide. As you know we've now retired over 50% of the shares in the last six years averaging 11% per year. And in 2022 we exceeded our initial buyback authorization as I mentioned by 40% buying 14% of the shares and returning all distributable cash flow $1.7 billion to shareholders. Now for 2023, we remain committed to the 10% buyback floor again, and we are well underway there. On the right-hand side, we try to put the buyback into context. If you look at our overall capital allocation framework, we have three principal sources of cash right? Of course, we start with our existing cash balance at the corporate level of $3.4 billion, and the modest interest we earn on that before investments. Then you add the $1.6 billion of distributable cash flow that we receive from our operating companies that we just guided to which includes recaps. And then finally, we expect cash proceeds. That's the bottom line from the sale of venture investments in non-core assets over time. Now we're clearly a cash-generative business. So where do we invest that capital? First, as you would expect we do prioritize our networks. So our fiber and 5G investments are important to us at the company level. None of that PP&E is funded out of our cash balance since we generate free cash flow at the OpCo level, but we mentioned it since it does impact the amount of distributable cash flow we receive, and therefore, it is a capital allocation decision. And as I mentioned on the previous slide, we see ourselves right now at peak levels of capital intensity. By far the largest use of cash is directed towards our buyback programs, where we've allocated over $12 billion since January 2017, and we are committed to this strategy again this year. From time to time, we will allocate capital to our FMC OpCos for strategic transactions that create value. A good example of this is the next fiber JV in the UK or even the acquisition of Sunrise. And then finally, we have been building a sizable portfolio of strategically aligned assets in tech media and infrastructure. Now building on this last point of investing capital into strategically aligned assets, we thought it would make sense to provide a bit more background on our current portfolio of investments and how we intend to manage this part of our business going forward. If you look at the top of Slide 10 on the left-hand side of my last slide, you'll see a familiar chart that breaks down the $3.1 billion ventures portfolio into principally tech content and infrastructure and then a few notes beneath that on how that value moved modestly in the fourth quarter. As a reminder, we're not coming up with these values on our own. We use a big four accounting firm to provide an independent assessment of value on an annual basis. Then in the three boxes on the top right we highlight some really important updates that we thought you should be aware of. First, but we have 60-plus investments in our tech portfolio, five of those investments, five companies today represent about 75% of the value. And we've listed them here for your reference. Three of these are companies that provide innovative cloud-based solutions, Plume you know well and BitSight is a cybersecurity business. Our net investment in these five companies is about $100 million and they are conservatively valued today at $700 million. Importantly, each of these companies is currently doing or planning to do business with our FMC opcos and that's part of the flywheel we provide investee companies. And quite frankly, why our pipeline of deals is so robust. The bottom line is that our tech ventures team has an eight-year track record of making money in strategically aligned product, service and technology companies and has already returned $500 million to the parent. Next, you'll also see our three largest infrastructure investments. AtlasEdge our 50/50 JV with DigitalBridge the EdgeConneX data center business, where we are a 5% shareholder with EQT. NEXFIBRE, the JV Iâve discussed already with Telefónica and InfraVia, that's going to build five million to seven million fiber homes in the UK. In each case here, we are using either existing opco assets or our strategic position in a market to create and benefit from these infrastructure platforms. It's also important to point out that these figures do not include our tower assets in markets like the UK and NL which we own through joint ventures. And then on the far right, we've provided just a few bullets on the announced Vodafone investment. I'm not sure there's much to add to what we've said publicly. We do think the stock is undervalued and there are a handful of near-term catalysts that should be beneficial. We've also put in place a very clever structure, which minimize the amount of equity we had to put up, while protecting our downside. By the way, there is no scenario where we would have to invest further capital beyond the relatively low cost of borrowing, which is partially offset by dividends. We also intend to replenish that equity investment, as we said in the press release, with asset sales and there are more than a handful that we're focused on presently. I suppose, it's good to see that the Vodafone stock is up since our announcement. We don't take credit for that, but obviously that's a positive. And then, finally, on the bottom right, we provided a few points on how we see this part of our business evolving. And you'll see that the three main verticals, tech, content and infrastructure, are targeting technology, services or platforms that are right up our alley, as they say. We have expertise, history or unique synergies in each of these areas. We've added a fourth pillar that we simply call Financial, for lack of a better word, which captures existing and potential investments in the debt or equity, of situations that we feel are strategic, distressed or provide a unique opportunity to put capital to work. Now, across the first three pillars, our investing principles are straightforward. We're looking for businesses that provide significant growth opportunities. This typically means businesses with scale, sector tailwinds and strategic benefits, to both our opcos or perhaps other portfolio investments. We're also interested in companies built around new or disruptive innovation that either diversify or amplify our core businesses. And then, lastly, we intend to be extremely disciplined here with exits and what we refer to as capital rotation. We've already begun to evaluate every position and believe there are more than a handful of assets that could be monetized, both in the Ventures group and outside the portfolio, like towers for example. So those are the core building blocks of value creation. First, we're going to continue to drive growth and free cash flow in our FMC champions and optimize our ownership positions in these businesses over time. This may include capital investment in M&A or strategic growth in some of those markets. Also, we'll be very flexible and agile about, as we've said in the past, listings or spins and things like that. Secondly, we're going to continue to put our capital to work in an efficient buyback program, as we've consistently done. And then, third, we're going to remain opportunistic about investments that we feel are strategically aligned with our core mission and within our capability set. And this last one is not easy, right? But we've surely earned the credibility to work here given our history of building, buying and exiting assets in our sector over time. I don't want to be on this call in three years' time, sitting on $3.5 billion of corporate cash and $6 billion of liquidity. I don't think you want that either. So we're focused on value creation first and foremost and I think we're in a great position to do that. Charlie, over to you.
Charlie Bracken: Thanks, Mike. On the next page, we've provided a summary of the revenue profile in our four key markets. 2022 saw stable revenues in three of our four markets and slight growth in Belgium despite the challenging macroeconomic environment. Fixed consumer revenue pressures across our markets were suffered by sensible price adjustments in Benelux and in the UK and we saw strong mobile and B2B growth across our portfolio. Virgin Media O2 delivered stable revenues in Q4 and across 2022 with continued pressures on fixed consumer ARPU and challenges in B2B being offset by strong mobile subscription revenue growth. Switzerland saw Q4 revenue growth decline, as continued strong mobile growth was offset by weaker B2B wholesale revenues and continued pressure on the consumer ARPU mix, as the business resets the pricing of its UPC customers in the migration to the Sunrise brand. In the Netherlands, despite a strong net outperformance, we saw a slight decline in revenue growth due to weakness in the consumer fixed business, partially offset by price adjustments, which we implemented in July. We delivered mobile service revenue growth of 6.3% in Q4, which was supported by a metal price adjustment in October. Belgium delivered Q4 revenue growth of 1.7% and 1.5% across 2022 and as the mid-June price adjustment continue to support top line fixed ARPU growth in the second half of the year. The next slide sets out our adjusted EBITDA performance in the quarter. The standout performance in Q4 was delivered by Virgin Media O2, posting full year adjusted EBITDA growth of 6%. In Q4, Virgin Media O2 delivered accelerated EBITDA growth of 10%, driven by synergies from the merger and the continued impact of price rises earlier in the year. This was despite $40 million of cost to capture, which hit the OpEx line this quarter. Versus the exceptional EBITDA growth in Q4, we do expect Q1 growth to be much more muted and this is impacted by the phasing of a delayed fixed price rise and tougher synergy comparative versus the prior year. Sunrise saw an EBITDA decline of 8.1% in Q4, as tailwinds from the MVNO synergies faded, combined with a continued weaker fixed ARPU mix. This continues to be as a result of the rotational churn challenge associated with the UPC migration to the Sunrise brand. We expect headwinds from this migration to continue to impact EBITDA trends in 2023 and in particular, impact the Q1 numbers. VodafoneZiggo saw a slight decline in EBITDA growth in Q4, driven by cost inflation headwinds, which offset the impact of price adjustments. We expect cost inflation headwinds, in particular, in energy to impact our 2023 outlook with an estimated EBITDA hit of over â¬100 million from energy and wages. Telenet reported EBITDA growth at around 5% for the second consecutive quarter, driven by price adjustments. The business anticipates ongoing headwinds from energy inflation, as well as manage wage increases of 11%, which will hit from the start of 2023. The next slide provides a more detailed update on our energy costs. Before the Ukraine invasion, energy typically accounted for a low single-digit percentage of operating costs. And historically, our policy was to hedge those costs forward on a rolling 12-month basis. This hedging policy helped soften the impact of rising energy costs in our 2022 results and we were able to absorb the impact of the unhedged costs and still meet our EBITDA guidance in our OpCos. However, in 2023, you will see a full impact of the increased energy costs, resulting from the invasion. And as you can see from these slides, we have broadly hedged the energy costs in each of our markets for 2023, but this has been at significantly higher rates than 2021 and 2022. We've highlighted the impact on each of our markets. But if you were to add them all up and use today's dollar exchange rates broadly our 2021 energy cost of around $280 million increased to around $410 million in 2022 and will be around $600 million in 2023, and representing a hit to free cash flow across our portfolio of around $330 million as a result of the invasion. So like everyone else, we don't know where energy prices will settle out. But in the meantime we continue to execute our rolling 12-month hedging program, and it starts over 2024 hedges, which thanks to recent price declines are at lower prices than we have locked in for 2023. We're also investigating longer-term fixed rate deals through PPA agreements. The next slide gives an update on our progress on the UK and Swiss synergies resulting from the O2 merger and Sunrise acquisition. We remain on track in both the UK and Switzerland with our overall synergy targets with a very strong finish to the year in the UK. Now just to remind you at Virgin Media O2, we expect to deliver £6.2 billion of NPV synergies or an annualized run rate target of £540 million from the O2 merger. In 2022, we constantly delivered over 30% of our synergies in the first 18 months of the combined business and are on track to deliver the 50% by the end of 2023. Meanwhile cost of capture peaked in 2022 and with over £300 million recorded out of the total £700 million cost to capture envelope. Cost to capture are expected to roughly halve in 2023 falling to around £150 million as investment in mobile capacity to support the MVNO migration took place in 2022. In 2023, trends are expected to benefit from the continued flow-through of MVNO synergies along with the unlocking of further synergy streams, including labor and commercial. Moving to Switzerland. We reaffirm our target to deliver CHF 3.7 billion NPV of synergies and incur CHF 400 million of overall cost to capture. 2022 represents a peak year for cost to capture as approximately CHF 140 million of cost to capture supported the business and achieving nearly 50% of our synergy run rate target, including the early benefit of MVNO synergies supporting half one trends in 2022. The business aims to deliver around 60% of the synergy run rate target by the end of 2023 with key focus areas being the buildup of the DSL migration and headcount synergies and delivery of these synergy projects will be supported by an expected CHF 50 million of cost to capture spend in 2023. Turning to capital allocation. Q4 saw a step up in capital intensity across our key operations, as we expected and was consistent with our full year capital intensity guidance for the group. Moving to distributable cash flow. We achieved our distributable cash flow guidance for the year delivering over $1.7 billion of full company distributable cash flow in 2022 based on the FX rates at the time of our 2022 guidance. On a reported basis for the full year, distributable cash flow was around $1.6 billion, including $455 million of dividends from Virgin Media O2 along with $478 million coming from our share of the recapitalization of that company and $321 million from VodafoneZiggo. Finally, our outlook for 2023. Now I appreciate there's a lot on this slide, but to help you understand our current view and the 2023 key financial drivers and ultimately the free cash flow and cash flow distributions of our key assets, we've added our view on some of the drivers behind those assumptions. Starting with VMO2. On an IFRS basis, we expect to achieve revenue growth mid-single-digit adjusted EBITDA growth supported by synergy execution and inflation-linked price rise adjustments with headwinds from inflationary pressures impacting our cost base including energy. Now these numbers are excluding cost of capture for the year where we expect OpEx and CapEx cost to capture of around GBP 120 million, which is still within our multiyear expectation of GBP 700 million. We also guide to property and equipment additions of around GBP 2 billion benefited from project lightly moving off balance sheet but this is offset somewhat by the fiber upgrade accelerating and the 5G mobile investments. On cash distributions to shareholders, Virgin Media O2 is guiding to around GBP 1.8 billion to GBP 2 billion versus GBP 1.6 billion distributed in 2022. Turning to Sunrise. We expect low single-digit revenue decline for the year along with low to mid-single-digit adjusted EBITDA decline including cost to capture. As the business continues to navigate the impact of the UPC brand migration and lower tailwinds from the synergies in 2023. We guide to property and equipment additions as a percentage of sales to be around 15% to 17% also including cost of capture. Cost to capture spend will drop this year falling to around CHF 50 million, of which CHF 10 million is expected to be attributed to OpEx. VodafoneZiggo is guiding to an improved revenue profile supported by pricing actions and low to mid-single-digit adjusted EBITDA decline as the business will be impacted by cost inflation headwinds of around â¬100 million from energy and wages. Property and equipment additions as a percentage of sales is expected to be 21% to 23%. The Dutch JV is guiding to shareholder distributions of â¬300 million to â¬400 million of cash which is impacted by higher cash taxes and a tougher EBITDA outlook. This is versus cash distributions of â¬602 million in 2022. And finally on an IFRS basis, Telenet are guiding to revenue growth of 1% to 2%, supported by price adjustments and broadly stable adjusted EBITDA, impacted by wage and energy inflation headwinds. Property and equipment additions as a proportion of sales are expected to be around 26% with an adjusted free cash flow outlook of â¬200 million for the year. This is lower versus the â¬409 million delivered in 2022, as free cash flow will be impacted by higher CapEx on 5G fiber build. And finally on group distributable cash flow guidance, regarding to GBP 1.6 billion of distributable cash flow in 2023 at guidance FX rates. We reiterate our commitment to buyback 10% of our shares outstanding in 2023. And with that operator, let's turn to questions.
Operator: The first question comes from the line of Sam McHugh with Exane. You may now proceed.
Sam McHugh: Thanks very much for question. I'm just trying to wrap my head around Slide 21 and the central cost update. It's kind of a two-part question. The first bit is just I see that there's some changes happening with the P&E allocations. Just to confirm that's already captured in the OpCo guidance that you gave separately for example, like the Switzerland OpEx charge shift that's already in the Swiss guidance? And then secondly, how should we think about the cash burn in Central in 2023, relative to what looks like maybe â¬200 million loss in 2022. Thanks very much.
Mike Fries: Charlie?
Charlie Bracken: Yes. Yes I confirm just everyone understands what goes on we do it sort of our joint venture as well as our wholly owned companies. We have what we call technical service agreements to really support the tech spend, which has been coming consistently down actually over the years. And so that's baked in at the opco level, we've actually got a renegotiation with one of them pending, but broadly speaking it's all fully baked in. And then at the center as you know we've been running around this â¬200 million time number. Gives and takes on that depending a little bit on how much money we spend on development and new areas, but I think you should assume it's going to be broadly consistent around that number for the upcoming years.
Sam McHugh: Fair. Thanks very much. Thanks, Charlie.
Operator: Thank you, Mr. McHugh. The next question comes from the line of James Ratcliffe with Evercore. You may now proceed.
James Ratcliffe: Thank you. Two if I could. One, sort of, big picture and one more specific. You talked about you're seeing for converged customers higher NPS scores, lower churn et cetera. What's the comparison to that? Because I certainly imagine that somebody isn't happy with their broadband service they're probably not going to add the mobile service as well. So can you talk about what sort of the comparison set for specific customers who do add on broadband what you're seeing versus customers who don't the converge route. And second just on the Vodafone investment. You're now a meaningful holder of a core partner of yours. Can you talk about anything that that would facilitate or anything you would make more difficult or limit in terms of your relationships around the JVs in particular? Thanks.
Mike Fries: Hi, James. Listen on the convergence figures is on the call, I can let him chime in a little bit too. But in the case of Holland, which we cite regularly I think we're simply comparing FMC converged customers to non-converged customers. Now fair point if that's one you're making there could be some sort of self-selection there. If you are happy with us then you're likely to buy more products, which means you become happier, whereas people who are not happy with us generally may not buy more products in which case you might say, well, clearly they're not having customers. At the same time there's no other way to do it. I mean, you're either converged or you're not. And when you can drive 20 points of NPS and have your churn that's a big enough gap so to speak to support the premise that convergence works. Now we can maybe endeavor to provide a bit more color and detail around that going forward, but that is the basic set of statistics. On the Vodafone stake we are good partners with Vodafone. We do business together quite frankly in three countries. We own a power network together through this Beacon arrangement in the UK. We've just signed a wholesale deal to provide them fiber access in Ireland. And of course we're partners in Holland. So our touch points with Vodafone are many. This may or may not change that dialogue. We'll see. It's certainly not the reason we did it. Direct reason we did it, but I think it doesn't hurt to have to ensure that our conversations with them going forward about all of these business arrangements are open and direct. That's really all I would say there.
James Ratcliffe: Great. Thank you.
Mike Fries: You bet.
Operator: Thank you, Mr. Ratcliffe. The next question comes from the line of Maurice Patrick with Barclays. You may now proceed.
Maurice Patrick: Thanks, guys. Thanks for taking the question. Yes, if I could ask a question on the UK ARPU trends. I think the UK ARPU the fixed ARPU was down about 3% or so this quarter despite 6.5% price increase you put through early in the year. Just curious to your thoughts in terms of how the next pricing increased lands. Obviously you've communicated the increase. I wondered how much of that you thought would flow through into better ARPU and therefore what's baked into your guidance would be helpful. And just linked to if I can be curious to know your thoughts around front book and backward pricing in the UK, clearly a lot of back book pricing increases but the front book is still very promotional. What do you think that's set to narrow? Thank you.
Mike Fries: Okay. I'll take the first one Lutz you take the second one. I think on the pricing, I will say is that, we anticipate our mobile and fixed pricing to behave â the impact of that pricing to be similar to prior years. And we said in the past, I think what we believe generally happens in fixed pricing, where we get roughly half of that if not more and mobile pricing a larger percentage. And so for sure we expect to either do as good or better, it's a larger increase that's certain in which case you might argue, hey, it's going to be harder. On the other hand, we have a lot more tools in place to manage customers in this particular go around. And as you would have read in the â going forward we have put into the Ts and Cs of contracts in the fixed side of our business in RPI plus 3.9% moving forward. So now you'll know next year, what that price rise is based on January's RPI. It won't be something we're making. It won't be a decision we're making on a discretionary basis it will look like BTs. Lutz, do you want to handle the front book back book question?
Lutz Schüler: Yeah. Maybe the only thing I would add on the pricing is right Mike said, it we have much more tools in place. So we are a month into it. And we know exactly how many customers of which cohorts have reacted in whatever way of form. And we also therefore understand exactly how much of the retained revenue we got. And we â I won't disclose any number, but so far we are fully on plan right? The last year you referred to that there are two things right? One thing is you do a general price increase and you get a certain reaction. And then second, during the entire year customers have been optimizing their bill irrespective price rise, because they don't want to keep using their landline or they want to get rid of mid-tier video content to simply optimize their bill. And therefore, you're right last year, the net of the part have been negative. Now we are not giving a guidance for this year, but we are guiding an overall revenue growth and so we are much more confident on this piece of it as well. Front book back book. So in general you are right. This is the strategic challenge, right? So you see price increases now across most of the operators, but you still see high competition in the acquisition market. Now, the way we are dealing with it in a positive way is twofold. One, we are not offering promotions on broadband. We're not following promotions of broadband around £21, £22 so we are staying more closer to £30 leveraging our speed advantage. So the promotions you've seen from us the last three months are selling more 50 mg, close to £30. And therefore, we have less of a back book front book issue. And the second thing is, we are also â with our digital capabilities, we now can test different ways of selling. So instead of an end of a promotion step-up we are also offering within the minimum contract length that customers are paying half of it. But in the minimum contract length then they pay a higher price so there's less of a churn. So there's a lot of optimization going on and stay tuned.
Maurice Patrick: Great. Thank you so much.
Operator: Thank you, Mr. Patrick. The next question comes from the line of Robert Grindle with Deutsche Bank. You may now proceed.
Robert Grindle: Yeah. Hi, there. Hope, you can hear me. On the UK cable upgrade and new fiber JV 1.5 million new fiber homes for the combination in 2023, doesn't appear massive versus one million achieved in full year 2022. Are you being cautious here? Perhaps, it takes a while to get to run rate and perhaps related to the question is the press as you're looking at out net acquisitions? Are you tilting away from build to buy? And how quickly can VMO2 sell off the new build, once it's happened? Thanks.
Mike Fries: Yes. There's a handful of good questions there. And I think on the speed point, I would simply say that we've got until 2028. So this is not -- we've never given numbers or time frames, that we believe would imply this is going to happen overnight. So, we think it does take a bit of time to get the machine moving, and the 50% uptick is reasonable, but could be exceeded. Let's see. It's a -- I'm not saying it's a marathon, but it's not a sprint either. We're hoping to have 80% of homes covered by fiber here by 2028. We think that is the right long-term strategy, but it's a long-term strategy. So we'll do it at the pace that makes sense for us. And as Lutz would say, we sit today with a one gig network, that reaches 16 million homes offering an average speed of 300 meg, which is 5 or 6 times faster than the average British households received from other providers. So, we're in a great position even while we build out. It's not as if, we have to convert a network from copper to fiber, or in some sort of other foot rates. Quite frankly, we are already leading the race and so we're just fortifying the long-term position. Lutz, do you want to take the second part?
Lutz Schüler: Yes. Can you repeat the question, Robert. So, what was it again?
Robert Grindle: How long does it take VMO2 to sell off the new JV once homes are passed? And are you tilting more to buy than build in the JV homes?
Lutz Schüler: Okay. So, I mean the first one, we are as you know, very experienced to get to the penetration on the lightening network. With now, next fiber there's no change there, right? Because Virgin Media O2, is building the network for next fiber and where the media is also the anchor tenant of it. So we are selling into it. And so you know, that we are getting to a far higher penetration than any altnet got to. And you know, also how quickly we ramp up. So, I don't expect any changes here in the future. So, we plan exactly with the same. And then obviously, it Virgin Media O2 is not a shareholder of next fiber. So this is more Liberty Global Telefonica and InfraVia. But altnet are getting under stress. This is our perception. The reason is they don't get to the penetration they need to. So according to our numbers, there is 7.6 million fiber homes in the UK from altnets and the penetration is around 15%. And from a pure wholesale perspective, we all know you need 40%, and cost of capital are increasing. So opportunistically, we will look at it and we will take the opportunities then as they come.
Operator: Thank you.
A â Mike Fries: Next question, operator.
Operator: The next question comes from the line of Luis Sanchez-Lecaroz with Credit Suisse. You may now proceed.
Luis Sanchez-Lecaroz: Hi. Thank you for taking my questions. I wanted to follow-up on the previous question and specifically looking a little bit deeper on the â¬1.5 million for next year? And can you give us the split between upgrade and rebuild rollout. And then looking into the UK guidance, can you let us know if you are factoring in the construction revenues from the new fiber JV and the retail business that you would get from greenfield areas? Thank you.
Mike Fries: Yeah. I mean, I think Luis we've said the split is roughly 50/50. But I don't know -- and Charlie this is a question for you whether we identified the revenues from next fiber or call them out, but there will be revenue, modest revenues not material revenues.
Charlie Bracken: Thatâs the correct answer. This is not a massive number, but there is some modest revenue baked into our numbers.
André Krause: Yeah. So, I mean, next fiber, right, we are building the network for that we are getting paid. On the other hand side, we are selling the network. And for that, we are now paying wholesale revenue. So this is the changes in the P&L, I think we haven't disclosed any numbers the split between expansion and upgrade. So -- and I think we don't want to do that. The only thing I'm saying is these are two completely different activity; expanding obviously is much more heavy lifting, it takes more work. And I think what we have said is that in 2022, we have expanded faster than in 2021. And in 2023 we have the ambition to expand faster than in 2022. And on the upgrade, what we have to do just to remind everybody is we have to pull fiber through our existing duct. This is much less of heavy listing. We have also guided that we will -- we are spending around £100 per homes passed. So, which also explains that the work is significantly less. And I want to simply reiterate the point Mike has made earlier that we first leverage our core network as much as we can. And selling fiber too early doesn't have really a commercial benefit for us at that point in time. So we have time.
Luis Sanchez-Lecaroz: Okay.
Mike Fries: Thanks Luis. Next question, operator.
Luis Sanchez-Lecaroz: Thanks.
Operator: Thank you, Mr. Lecaroz. The next question comes from the line of Polo Tang with UBS. You may now proceed.
Polo Tang: Hi, thanks for taking questions. I have two. The first one is on Switzerland. So a question for André. Can you talk through the competitive dynamics in the Swiss market? And maybe talk in a bit more detail about the issues that you're facing with the retirement of the UPC brand? And going forward, should we expect maybe a relatively stable broadband performance in terms of net adds for Switzerland but maybe it's just a case of re-pricing taking its time to work its way through. Alternatively where are the other moving parts that are driving the Swiss EBITDA declines in 2023? And then second question is really just about fiber wholesale in the UK. So I appreciate that you're still in the process of upgrading your cable network to fiber, but have you had any discussions with other communication providers about wholesaling on the VMO2 network? And do you think that this could be a meaningful revenue stream going forward? Alternatively, is the Equinox 2 pricing from Openreach now an unstoppable train meaning you have no chance.
Mike Fries: Well, let me take the second one first, and Andre, you can work up an answer to the first one. As I just mentioned, we're building a network, we think we'll reach 80% of the market. It's going to happen over an extended period of time. It's not happening tomorrow. And what any investor in a telecom market requires or would like to see some long-term certainty and a level playing field. Equinox 2, from our point of view, is unlikely to make a long-term impact on our plans. But in the short term, feels to us to be a bit desperate and premature by BT, reflecting, I would say, an overreaction to the market more broadly for whatever reason they felt that was necessary. On the other hand, we think Ofcom gets the larger picture here and is likely to look at Equinox 2 in a -- hopefully, a comprehensive way, and we look forward to the consultation process. But from our point of view, whether we are providing wholesale services tomorrow or next year or the year after, remember that in the upgrade of our fiber homes, which we announced some time ago, upgraded to 16 million homes. We did not say at that point in time that, that decision to spend £100 per home was based upon the need to realize wholesale revenue. In fact, we said the exact opposite, which was we believe this makes sense relative to DOCSIS 4, regardless of wholesale revenue. That doesn't mean we don't have ambition. It just means to say that our economics are sound either way. Now the next fiber JV clearly would love to expand wholesale revenue beyond Virgin Media O2 as its anchor tenant. And in that instance, that particular joint venture will make the argument it needs to make and pursue the strategic ambition it needs to pursue. So hopefully, that puts a little bit of context around how we see the market. This is a long-term process here. This isn't something that any one move by any one operator is going to derail in our opinion, and we remain committed. Andre?
André Krause: Yes. In regards to competitive dynamics, I would say, Q4 has seen a lot of liquidity in the market. Also seasonally, Black Friday was probably the biggest sales event in the last year. As such, we have also seen a very high level of promotional activity. We were benefiting from that from a customer perspective. As you've seen and not only us, but also competitors gained quite a lot of new customers in the market, but the pricing levels or the discount levels on those promotions are not really sustainable and are also causing some of the pressure that we have the migrations at customers that are looking at the front book prices at or migrated at back book prices, that is, of course, attention that is not making our life easy with all of the customers that we want to migrate over to the new Sunrise portfolio. As a result of that, we have started already in Q1 to reduce our promotional aggressiveness mainly on the main brand. Our Flanker brand will not be addressed by that, mainly because the Flanker brand has a different role and needs to play also the role of being more price aggressive. But on the main brand, we want to protect the back book better with lower promotional aggressiveness in particular, with promotions that do no longer offer a discount over the first contract term, but at maximum only half of the first contract terms, so that customers get, again, used to actually pay the normal list price. Now in terms of dynamics for next year, clearly the main driver for next year is those right pricing of the mainly fixed customers coming from UPC that is roughly less than one-third of our total customers and not all of those customers will be necessarily a drag to ARPU and to direct to our revenues. But some of those are, if you think about it I mean there are of course, certain customers that are sitting on one or two products, where we still have good opportunity to cross and up-sell products, provide more for same for example or more for more. While there is a certain segment of customers that has already maxed out the product range and is sitting on an outpriced price point that no longer exists on the new front book. And in order to maintain those customer relations healthy and to continue working with them, we are doing this right pricing exercise. That's the main drag I would say also on the top line for next year. On top of that I would say on the EBITDA guidance, we of course continue to actually prep the business to capture growth going forward. So we continue to actually do OpEx investments on the digital side. We also do have some increase in OpEx that is coming from cloudification things moving from CapEx to OpEx. And we have a number of other, I would say marketing activities that for the first time will hit full year range like for example the Swiss sponsorship, which we only started in 2022 but we'll see for the full extent only in 2023. But the major driver I would say of the headache is really the right pricing in that relatively small fixed customer segment. All other growth engines. If you look at mobile, if you get D2D, if you look at flanker brand, maintain healthy but we are accelerating this exercise now to actually create a growth platform that we can start from going forward.
Mike Fries: I'll just add that I have confidence in Andre and the team to manage through this. There's deep knowledge and understanding of the market and this is a blip not a change in direction. On the other hand, I would also point out that Charlie skipped over in his guidance slide, the fact that Switzerland is guiding to 320 million to 350 million of free cash flow in 2023, which I'm going to guess here Andre I think it's up 30% to 40% over 2022. So despite the challenge is that Andre is working through at the revenue and customer level, which I'm sure we will get through, the business is generating significant free cash flow and on pace for the kinds of free cash flow results we had initially anticipated when we made the acquisition.
Polo Tang: Clear. Thanks.
Operator: Thank you, Mr. Tang. The next question comes from the line of Steve Malcolm with Redburn. You may now proceed.
Steve Malcolm: Yes. Good afternoon, guys. And I'll go for 1.5 questions, one in the UK just a quick follow-up to an earlier question. First just going back to the UK and the price moves look that you're enacting at the moment. I guess if I look at 2022, looking from the outside in my perception would be that the fixed line price rises didn't learn probably quite as well, as you'd hoped and the mobile price size maybe landed a bit better. I don't know if that's right, wrong but that's my impression. As you go into 2023, look you said you've got more tools at your disposal, but obviously, it's a very, very big price rise. So I guess the instinctive reaction would be that you're going to see more churn, you're going to some more promotional activity. But could you just elaborate maybe on those best actions that you can take to prevent that and give us sort of a bit more confidence that we don't see the ARPU reactions that we saw following the price rise last year that would be great. And then just coming back to the point on Vodafone. Mike, you said that the reason for the investment was not to sort of create more touch points of Vodafone was it exactly? Was it just because you thought the shares were cheap. And if that is the case, can you maybe give us some sort of guidelines as to what is sort of in and out your scope? Is it just sort of contiguous sector telco media anything that you think is sort of opportunistic. Or does there have to be some kind of existing relationship for you to invest shareholders' money in stocks like Vodafone? Thank you.
Mike Fries: Lutz, do you want to start with that?
Lutz Schüler: So I mean your high-level observation is right for last year, but I think the reasons are a bit different. So if you park the price rise for a second, right? On the fixed side customers are optimizing their bill because simply right the average ARPU is £50 pounds. So if you want to optimize household spend you look more at the fixed side at the mobile side. And so irrespective of price rise, customers are canceling their landline because they use their mobile and customers are optimizing and picking more of the video content they really need. This is what we have been seeing. And the mobile side you don't see that. What you see on the mobile side instead is they keep using their old phone for longer, right? So if you -- these are developments there would have been happening with price rise or without price rise due to the cost and living crisis. Now the price rise, itself and this is then the question, how do you define that? Last year and I think this is what Mike said earlier on, if you would say well everything you take into account two months after customers have seen the first bill. Then you can say that also on the fixed side, we landed something like 50% of the price rise. And on the mobile side, because it's only on airtime not on hardware, the overall number of the price rise is much lower and it is embedded in the Ts and Cs. So you see barely very little barely zero or very little reason to it. Now what does this mean for this year, right? And we are not guiding on fixed ARPU but we have been -- we are doing a lot of things different. Number one, we are sending out the letters to customers over a period of two months and in a staggered approach. This is number one. That has two benefits. One, we always can ensure we have enough agents dealing with it, so which weren't the case 100% last year. And second, we have really real-time data, so we can see how many customers are calling and what is the best possible retention for them in terms of customer and ARPU. And then we see within 24 hours delay what is actually happening. And when you take this all into account, there's a lot of room for optimization. We can leverage convergence of our fixed customers, we can sell mobile. We can sell in interesting content. We can sell in hardware. And I'm not disclosing anything, but so far, as I said early on, we are on plan with a fixed price rise. And on the mobile side, we have landed it also now, right? So it is communicated and out. And the reaction so far we have been seeing are not higher than a year ago. Hope, that helps.
Mike Fries: Looking on Vodafone -- yes. Vodafone, I would say to people -- we said publicly, yes, the stock seems undervalued to us. There's a lot of undervalued stocks out there, by the way. Ours included. And that's why we spent $1.7 billion last year buying it. But certainly, this one also looks undervalued with some near-term catalysts that should play out here we think in a positive way. And it was a relatively small investment, if you look at the -- if you see through how we financed the position. Now, we have a lot of touch points with Vodafone, as I just mentioned and I look forward to a very constructive dialogue with the current and future CEO, whoever that will be, around all of those particular issues and if necessary, with the Board. So, as I mentioned, we're not an activist here, but we certainly hope to be engaged in understanding of what their strategy is and to perhaps even influence that if it makes sense. But we're not doing this to create tension or stress. We're not trying to rattle the pages here. We thought it was an opportunistic transaction that was financed. We thought very effectively with relatively small amounts of capital we could put to risk in a stock that was at or near a 25-year low. So that's really the way to think about it. Are we going to do 10 more of these? No, no. But we will always be opportunistic in situations that we think are strategically and financially aligned. We have time for one more or weâre calling it? Go ahead.
Steve Malcolm: Sorry, I was just -- when you say catalyst, I mean, can you elaborate on what they may be.
Mike Fries: I can't give you anything that hasn't been talked about 100 times publicly, UK, mobile, consolidation, rationalization, Spain and Italy, pending Vantage deal, towers in the UK and NL, a German strategy evolution, et cetera. I mean, there's Africa, you just have to read the press. There's a handful for you right there.
Steve Malcolm: Okay. Thanks a lot.
Mike Fries: You got it. Yes. Rick, I donât know if we have time for one more or if the minutes passed, should I close it off?
Rick Westerman: Just take one more Mike and then shut it down.
Mike Fries: Okay. All right. Thanks for hanging in guys. Weâll take one more.
Operator: We'll take the last question from Carl Murdock-Smith with Berenberg. You may now proceed.
Carl Murdock-Smith: Hi, thanks very much for the question and taking time for one last one. So I'll just ask one. I think, slide 9 is a very powerful one, on the long-term buyback commitments overtime. Obviously, you've committed to a floor of 10% of buyback this year. That commitment was first actually made 2.5 years ago at the Q2 2021 results and kind of I think that long-term commitment, as also shown on slide 9 is very, very important. Did you at all think about giving a longer-term buyback commitment rather than just committing to the 2023 buyback? And how should we be thinking about your ongoing commitments in future years? Thanks.
Mike Fries: Yeah. That's good question, Carl. I appreciate you asking that. We're not today providing any additional long-term guidance, but you don't have to do much reading between the lines to conclude based on everything I said in my remarks, that we're committed to shareholder remuneration. So you should expect overtime we'll continue to provide updates on that long-term strategy. And I think past is prologue.
Carl Murdock-Smith: Okay. That helps. Okay. Thatâs great. Thank you very much.
Mike Fries: You got it. Thanks you got it. Thanks everybody for hanging in. I appreciate you enduring the long remarks. If you're still on we had a lot of info and a lot of talk about and a very strong 2022. And I think all the building blocks in place for strong 2023 and most importantly for value creation. So I appreciate your support. And we're always around for questions if you have any as a follow-up. Thanks everyone.
Operator: Ladies and gentlemen, this concludes Liberty Global's Fourth Quarter 2022 Investor Call. As a reminder, a replay of the call will be available in the Investor Relations Section of Liberty Global's website. There, you can also find a copy of today's presentation materials. Have a good day.
