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v3.21.1

Segment Reporting | 3 Months Ended
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Mar. 31, 2021
Segment Reporting, Measurement Disclosures [Abstract] |
Segment Reporting | Segment Reporting We generally identify our reportable segments as (i) those consolidated subsidiaries that represent 10% or more of our revenue, Adjusted EBITDA (as defined below) or total assets or (ii) those equity method affiliates where our investment or share of revenue or Adjusted EBITDA represents 10% or more of our total assets, revenue or Adjusted EBITDA, respectively. In certain cases, we may elect to include an operating segment in our segment disclosure that does not meet the above-described criteria for a reportable segment. We evaluate performance and make decisions about allocating resources to our operating segments based on financial measures such as revenue and Adjusted EBITDA. In addition, we review non-financial measures such as customer growth, as appropriate. Adjusted EBITDA is the primary measure used by our chief operating decision maker to evaluate segment operating performance and is also a key factor that is used by our internal decision makers to (i) determine how to allocate resources to segments and (ii) evaluate the effectiveness of our management for purposes of annual and other incentive compensation plans. As we use the term, “Adjusted EBITDA” is defined as net earnings (loss) before net income tax benefit (expense), other non-operating income or expenses, net share of results of affiliates, net gains (losses) on extinguishment of debt, net realized and unrealized gains (losses) due to changes in fair value of certain investments and debt, net foreign currency gains (losses), net gains (losses) on derivative instruments, net interest expense, depreciation and amortization, share-based compensation, provisions and provision releases related to significant litigation and impairment, restructuring and other operating items. Other operating items include (a) gains and losses on the disposition of long-lived assets, (b) third-party costs directly associated with successful and unsuccessful acquisitions and dispositions, including legal, advisory and due diligence fees, as applicable, and (c) other acquisition-related items, such as gains and losses on the settlement of contingent consideration. Our internal decision makers believe Adjusted EBITDA is a meaningful measure because it represents a transparent view of our recurring operating performance that is unaffected by our capital structure and allows management to (1) readily view operating trends, (2) perform analytical comparisons and benchmarking between segments and (3) identify strategies to improve operating performance in the different countries in which we operate. A reconciliation of net earnings or loss to Adjusted EBITDA is presented below. As of March 31, 2021, our reportable segments are as follows: Consolidated: •U.K./Ireland •Belgium •Switzerland •Central and Eastern Europe Nonconsolidated: •VodafoneZiggo JV All of our reportable segments derive their revenue primarily from residential and B2B communications services, including broadband internet, video, fixed-line telephony and mobile services. Our central and corporate functions (Central and Corporate) primarily include (i) services provided to the VodafoneZiggo JV and various third parties related to transitional service agreements, (ii) sales of customer premises equipment to the VodafoneZiggo JV and (iii) certain centralized functions, including billing systems, network operations, technology, marketing, facilities, finance and other administrative functions. Performance Measures of Our Reportable Segments The amounts presented below represent 100% of each of our reportable segment’s revenue and Adjusted EBITDA. As we have the ability to control Telenet, we consolidate 100% of Telenet’s revenue and expenses in our condensed consolidated statements of operations despite the fact that third parties own a significant interest. The noncontrolling owners’ interests in the operating results of Telenet and other less significant majority-owned subsidiaries are reflected in net earnings or loss attributable to noncontrolling interests in our condensed consolidated statements of operations. Similarly, despite only holding a 50% noncontrolling interest in the VodafoneZiggo JV, we present 100% of its revenue and Adjusted EBITDA in the tables below. Our share of the VodafoneZiggo JV’s operating results is included in share of results of affiliates, net, in our condensed consolidated statements of operations.
|  |  |  |  | Revenue
|  |  | Three months ended March 31,
|  |  |  |  | 2021 |  | 2020
|  |  |  |  | in millions
U.K./Ireland |  |  |  |  | $ | 1,770.7 |  |  | $ | 1,620.6 |
Belgium |  |  |  |  | 772.7 |  |  | 718.1 |
Switzerland |  |  |  |  | 841.8 |  |  | 316.8 |
Central and Eastern Europe |  |  |  |  | 128.6 |  |  | 119.1 |
Central and Corporate |  |  |  |  | 102.7 |  |  | 101.2 |
Intersegment eliminations |  |  |  |  | (1.2) |  |  | — |
Total |  |  |  |  | $ | 3,615.3 |  |  | $ | 2,875.8 |
VodafoneZiggo JV |  |  |  |  | $ | 1,217.0 |  |  | $ | 1,097.1 |
|  |  |  |  | Adjusted EBITDA
|  |  | Three months ended March 31,
|  |  |  |  | 2021 |  | 2020
|  |  |  |  | in millions
U.K./Ireland |  |  |  |  | $ | 692.6 |  |  | $ | 655.4 |
Belgium |  |  |  |  | 371.8 |  |  | 331.6 |
Switzerland |  |  |  |  | 281.6 |  |  | 134.1 |
Central and Eastern Europe |  |  |  |  | 57.0 |  |  | 54.3 |
Central and Corporate |  |  |  |  | (35.7) |  |  | (25.1) |
Total |  |  |  |  | $ | 1,367.3 |  |  | $ | 1,150.3 |
VodafoneZiggo JV |  |  |  |  | $ | 565.2 |  |  | $ | 502.8 |
The following table provides a reconciliation of net earnings to Adjusted EBITDA:
|  |  | Three months ended March 31,
|  |  |  |  | 2021 |  | 2020
|  |  |  |  | in millions
Net earnings |  |  |  |  | $ | 1,440.3 |  |  | $ | 1,017.7 |
Income tax expense |  |  |  |  | 170.5 |  |  | 80.1 |
Other income, net |  |  |  |  | (10.1) |  |  | (52.4) |
Share of results of affiliates, net |  |  |  |  | (1.7) |  |  | (33.4) |
Losses on debt extinguishment, net |  |  |  |  | — |  |  | 54.5 |
Realized and unrealized losses (gains) due to changes in fair values of certain investments and debt, net |  |  |  |  | (194.6) |  |  | 529.8 |
Foreign currency transaction gains, net |  |  |  |  | (303.1) |  |  | (391.7) |
Realized and unrealized gains on derivative instruments, net |  |  |  |  | (811.1) |  |  | (1,237.3) |
Interest expense |  |  |  |  | 335.1 |  |  | 313.3 |
Operating income |  |  |  |  | 625.3 |  |  | 280.6 |
Impairment, restructuring and other operating items, net |  |  |  |  | 44.4 |  |  | 31.0 |
Depreciation and amortization |  |  |  |  | 634.2 |  |  | 783.5 |
Share-based compensation expense |  |  |  |  | 63.4 |  |  | 55.2 |
Adjusted EBITDA |  |  |  |  | $ | 1,367.3 |  |  | $ | 1,150.3 |
Property and Equipment Additions of our Reportable Segments The property and equipment additions of our reportable segments (including capital additions financed under vendor financing or finance lease arrangements) are presented below and reconciled to the capital expenditure amounts included in our condensed consolidated statements of cash flows. For additional information concerning capital additions financed under vendor financing and finance lease arrangements, see notes 8 and 10, respectively.
| Three months ended March 31,
| 2021 |  | 2020
| in millions
U.K./Ireland | $ | 351.4 |  |  | $ | 346.6 |
Belgium | 153.4 |  |  | 141.6 |
Switzerland | 154.2 |  |  | 69.2 |
Central and Eastern Europe | 17.6 |  |  | 18.9 |
Central and Corporate (a) | 70.0 |  |  | 78.1 |
Total property and equipment additions | 746.6 |  |  | 654.4 |
Assets acquired under capital-related vendor financing arrangements | (328.2) |  |  | (370.9) |
Assets acquired under finance leases | (9.7) |  |  | (11.1) |
Changes in current liabilities related to capital expenditures | 67.1 |  |  | 75.4 |
Total capital expenditures, net | $ | 475.8 |  |  | $ | 347.8 |
Property and equipment additions - VodafoneZiggo JV | $ | 234.5 |  |  | $ | 245.4 |
_______________ (a)Includes (i) property and equipment additions representing centrally-owned assets that benefit our operating segments and (ii) the net impact of certain centrally-procured network equipment that is ultimately transferred to our operating segments. Revenue by Major Category Our revenue by major category for our consolidated reportable segments is set forth below:
|  |  | Three months ended March 31,
|  |  |  |  | 2021 |  | 2020
|  |  |  |  | in millions
Residential revenue: |  |  |  |  |  |  |
Residential cable revenue (a): |  |  |  |  |  |  |
Subscription revenue (b): |  |  |  |  |  |  |
Broadband internet |  |  |  |  | $ | 926.8 |  |  | $ | 796.8 |
Video |  |  |  |  | 745.1 |  |  | 683.1 |
Fixed-line telephony |  |  |  |  | 357.2 |  |  | 338.2 |
Total subscription revenue |  |  |  |  | 2,029.1 |  |  | 1,818.1 |
Non-subscription revenue |  |  |  |  | 56.7 |  |  | 53.0 |
Total residential cable revenue |  |  |  |  | 2,085.8 |  |  | 1,871.1 |
Residential mobile revenue (c): |  |  |  |  |  |  |
Subscription revenue (b) |  |  |  |  | 481.3 |  |  | 235.9 |
Non-subscription revenue |  |  |  |  | 280.4 |  |  | 145.3 |
Total residential mobile revenue |  |  |  |  | 761.7 |  |  | 381.2 |
Total residential revenue |  |  |  |  | 2,847.5 |  |  | 2,252.3 |
B2B revenue (d): |  |  |  |  |  |  |
Subscription revenue |  |  |  |  | 147.9 |  |  | 124.6 |
Non-subscription revenue |  |  |  |  | 456.3 |  |  | 349.5 |
Total B2B revenue |  |  |  |  | 604.2 |  |  | 474.1 |
Other revenue (e) |  |  |  |  | 163.6 |  |  | 149.4 |
Total |  |  |  |  | $ | 3,615.3 |  |  | $ | 2,875.8 |
_______________ (a)Residential cable subscription revenue includes amounts received from subscribers for ongoing services and the recognition of deferred installation revenue over the associated contract period. Residential cable non-subscription revenue includes, among other items, channel carriage fees, late fees and revenue from the sale of equipment. (b)Residential subscription revenue from subscribers who purchase bundled services at a discounted rate is generally allocated proportionally to each service based on the standalone price for each individual service. As a result, changes in the standalone pricing of our cable and mobile products or the composition of bundles can contribute to changes in our product revenue categories from period to period. (c)Residential mobile subscription revenue includes amounts received from subscribers for ongoing services. Residential mobile non-subscription revenue includes, among other items, interconnect revenue and revenue from sales of mobile handsets and other devices. (d)B2B subscription revenue represents revenue from services to certain small or home office (SOHO) subscribers. SOHO subscribers pay a premium price to receive expanded service levels along with broadband internet, video, fixed-line telephony or mobile services that are the same or similar to the mass marketed products offered to our residential subscribers. B2B non-subscription revenue includes (i) revenue from business broadband internet, video, fixed-line telephony, mobile and data services offered to medium to large enterprises and, on a wholesale basis, to other operators and (ii) revenue from long-term leases of portions of our network. (e)Other revenue includes, among other items, (i) broadcasting revenue in Belgium and Ireland, (ii) revenue earned from the JV Services and the sale of customer premises equipment to the VodafoneZiggo JV and (iii) revenue earned from transitional and other services provided to various third parties. Geographic Segments The revenue of our geographic segments is set forth below:
|  |  | Three months ended March 31,
|  |  |  |  | 2021 |  | 2020
|  |  |  |  | in millions
U.K. |  |  |  |  | $ | 1,635.0 |  |  | $ | 1,496.4 |
Belgium |  |  |  |  | 772.7 |  |  | 718.1 |
Switzerland |  |  |  |  | 841.8 |  |  | 316.8 |
Ireland |  |  |  |  | 135.7 |  |  | 124.2 |
Poland |  |  |  |  | 115.6 |  |  | 106.7 |
Slovakia |  |  |  |  | 13.0 |  |  | 12.4 |
Other, including intersegment eliminations |  |  |  |  | 101.5 |  |  | 101.2 |
Total |  |  |  |  | $ | 3,615.3 |  |  | $ | 2,875.8 |
VodafoneZiggo JV (the Netherlands) |  |  |  |  | $ | 1,217.0 |  |  | $ | 1,097.1 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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