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Financial Instruments (Tables) | 12 Months Ended
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Dec. 31, 2020
Financial Instruments |
Schedule of carrying value and estimated fair value of financial instruments | The carrying and estimated fair values of the Group’s non-derivative financial instruments as of December 31, 2020 and 2019, were as follows:
|  | 2020 |  | 2019
|  | Carrying Value |  | Fair Value |  | Carrying Value |  | Fair Value
Assets: |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | Ps. | 29,058,093 |  | Ps. | 29,058,093 |  | Ps. | 27,452,265 |  | Ps. | 27,452,265
Trade notes and accounts receivable, net |  |  | 12,343,797 |  |  | 12,343,797 |  |  | 14,486,184 |  |  | 14,486,184
Warrants issued by UHI (see Note 9) |  |  | — |  |  | — |  |  | 33,775,451 |  |  | 33,775,451
Long-term loan and interests receivable from GTAC (see Note 10) |  |  | 821,253 |  |  | 824,092 |  |  | 872,317 |  |  | 875,585
Open-Ended Fund (see Note 9) |  |  | 1,135,803 |  |  | 1,135,803 |  |  | 4,688,202 |  |  | 4,688,202
Other equity instruments (see Note 9) |  |  | 5,397,504 |  |  | 5,397,504 |  |  | 5,751,001 |  |  | 5,751,001
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Senior Notes due 2025, 2032 and 2040 |  | Ps. | 29,923,950 |  | Ps. | 40,584,237 |  | Ps. | 28,325,700 |  | Ps. | 34,954,254
Senior Notes due 2045 |  |  | 19,949,300 |  |  | 24,282,886 |  |  | 18,883,800 |  |  | 19,739,047
Senior Notes due 2037 and 2043 |  |  | 11,000,000 |  |  | 9,238,435 |  |  | 11,000,000 |  |  | 8,986,870
Senior Notes due 2026 and 2046 |  |  | 23,939,160 |  |  | 31,811,792 |  |  | 22,660,560 |  |  | 26,645,193
Senior Notes due 2049 |  |  | 14,961,975 |  |  | 18,978,667 |  |  | 14,162,850 |  |  | 15,364,426
Notes due 2027 |  |  | 4,500,000 |  |  | 5,035,860 |  |  | 4,500,000 |  |  | 4,656,375
Long-term notes payable to Mexican banks |  |  | 19,602,893 |  |  | 19,801,142 |  |  | 22,845,382 |  |  | 23,012,707
Lease liabilities |  |  | 9,292,351 |  |  | 9,343,100 |  |  | 9,363,520 |  |  | 9,120,903
Other notes payable |  |  | — |  |  | — |  |  | 1,324,063 |  |  | 1,295,780
The carrying values (based on estimated fair values), notional amounts, and maturity dates of the Group’s derivative financial instruments as of December 31, 2020 and 2019, were as follows:
|  |  |  |  | Notional |  |
|  |  |  |  | Amount |  |
December 31, 2020: |  | Carrying |  | (U.S. Dollars in |  |
Derivative Financial Instruments |  | Value |  | Thousands) |  | Maturity Date
Liabilities: |  |  |  |  |  |  |  |
Derivatives recorded as accounting hedges (cash flow hedges): |  |  |  |  |  |  |  |
TVI’s interest rate swap(a) |  | Ps. | 1,759 |  | Ps. | 122,400 |  | May 2022
TVI’s interest rate swap(b) |  |  | 23,784 |  | Ps. | 730,493 |  | April 2022
Interest rate swaps (c) |  |  | 109,146 |  | Ps. | 2,000,000 |  | October 2022
Interest rate swaps (d) |  |  | 86,171 |  | Ps. | 1,500,000 |  | October 2022
Interest rate swaps (e) |  |  | 180,941 |  | Ps. | 2,500,000 |  | February 2023
Interest rate swaps (f) |  |  | 762,827 |  | Ps. | 10,000,000 |  | June 2024
Forward (g) |  |  | 714,763 |  | U.S.$ | 330,500 |  | January 2021 through March 2022
Derivatives not recorded as accounting hedges: |  |  |  |  |  |  |  |
Interest rate swap(h) |  |  | 204,250 |  | Ps. | 9,385,347 |  | March 2022
TVI's forward (i) |  |  | 176,868 |  | U.S.$ | 88,353 |  | January 2021 through February 2022
Empresas Cablevisión’s forward (j) |  |  | 190,726 |  | U.S.$ | 96,789 |  | January 2021 through February 2022
Sky's forward (k) |  |  | 318,701 |  | U.S.$ | 135,000 |  | February 2021 through February 2022
Forward (l) |  |  | 706,287 |  | U.S.$ | 344,898 |  | January 2021 through February 2022
Total liabilities |  | Ps. | 3,476,223 |  |  |  |  |
|  |  |  |  | Notional |  |
|  |  |  |  | Amount |  |
December 31, 2019: |  | Carrying |  | (U.S. Dollars in |  |
Derivative Financial Instruments |  | Value |  | Thousands) |  | Maturity Date
Assets: |  |  |  |  |  |  |  |
Derivatives recorded as accounting hedges (cash flow hedges): |  |  |  |  |  |  |  |
TVI’s interest rate swap(a) |  | Ps. | 4,592 |  | Ps. | 407,200 |  | May 2020 through May 2022
Total assets |  | Ps. | 4,592 |  |  |  |  |
Liabilities: |  |  |  |  |  |  |  |
Derivatives recorded as accounting hedges (cash flow hedges): |  |  |  |  |  |  |  |
TVI’s interest rate swap(b) |  | Ps. | 8,943 |  | Ps. | 938,182 |  | April 2022
Interest rate swaps (c) |  |  | 38,543 |  | Ps. | 2,000,000 |  | October 2022
Interest rate swaps (d) |  |  | 30,702 |  | Ps. | 1,500,000 |  | October 2022
Interest rate swaps (e) |  |  | 83,122 |  | Ps. | 2,500,000 |  | February 2023
Interest rate swaps (f) |  |  | 185,205 |  | Ps. | 6,000,000 |  | June 2024
Forward (g) |  |  | 144,466 |  | U.S.$ | 218,688 |  | January 2020 through September 2020
Derivatives not recorded as accounting hedges: |  |  |  |  |  |  |  |
TVI's forward (i) |  |  | 45,968 |  | U.S.$ | 66,000 |  | January 2020 through October 2020
Empresas Cablevisión’s forward (j) |  |  | 48,474 |  | U.S.$ | 73,000 |  | January 2020 through October 2020
Sky's forward (k) |  |  | 87,090 |  | U.S.$ | 127,850 |  | January 2020 through September 2020
Forward (l) |  |  | 242,777 |  | U.S.$ | 361,550 |  | January 2020 through October 2020
Total liabilities |  | Ps. | 915,290 |  |  |  |  |
| (a) |  | TVI has entered into several derivative transaction agreements (interest rate swaps) with two financial institutions from August 2013 through May 2022 to hedge the variable interest rate exposure resulting from Mexican peso loans of a total principal amount of Ps.122,400 and Ps.407,200, as of December 31, 2020 and 2019, respectively. Under these agreements, the Company receives monthly payments based on aggregate notional amounts of Ps.122,400 and Ps.407,200 and makes payments based on the same notional amount at an annual weighted average fixed rate of 5.585%. TVI has recognized the change in fair value of this transaction as an accounting hedge, and recorded a loss of Ps.60,730 and Ps.54,383 in other comprehensive income or loss as of December 31, 2020 and 2019, respectively. In the years ended as of December 31, 2020 and 2019, TVI recorded a gain of Ps.2,046 and Ps.26,962, respectively, in consolidated other finance income or expense.
| (b) |  | In March and April 2017, TVI entered into several derivative transaction agreements (interest rate swaps) with two financial institutions through April 2022 to hedge the variable interest rate exposure resulting from Mexican peso loan of a total principal amount of Ps.730,493 and Ps.938,182, as of December 31, 2020 and 2019, respectively. Under these agreements, the Company receives monthly payments based on aggregate notional amounts of Ps.730,493 and Ps.938,182, as of December 31, 2020 and 2019, respectively, at an annual variable rate of 28- days TIIE and makes monthly payments based on the same notional amounts at an annual weighted average fixed rate of 7.2663%. The Company has recognized the change in fair value of this transaction as an accounting hedge, and recorded a loss of Ps.23,784 and Ps.8,943 in other comprehensive income or loss as of December 31, 2020 and 2019, respectively. TVI recorded a (loss) gain of Ps.(11,700) and Ps.11,738 for this transaction agreement in consolidated other finance income or expense as of December 31, 2020 and 2019, respectively.
| (c) |  | In November 2017, the Company entered into a derivative transaction agreement (interest rate swap) through October 2022, to hedge the variable interest rate exposure resulting from a Mexican peso loan of a total principal amount of Ps.2,000,000. Under this transaction, the Company receives monthly payments based on an aggregate notional amount of Ps.2,000,000, at an annual variable rate of 28 days of TIIE and makes monthly payments based on the same notional amount at an annual fixed rate of 7.3275%. The Company has recognized the change in fair value of this transaction as an accounting hedge, and recorded a cumulative loss of Ps.107,884 and Ps.38,543 in other comprehensive income or loss as of December 31, 2020 and 2019, respectively. In 2020 and 2019, the Company recorded a (loss) gain of Ps.(28,719) and Ps.20,933, respectively, in consolidated other finance income or expense.
| (d) |  | In November and December 2017, the Company entered into a derivative transaction agreement (interest rate swap) through October 2022, to hedge the variable interest rate exposure resulting from a Mexican peso loan of a total principal amount of Ps.1,500,000. Under this transaction, the Company receives monthly payments based on an aggregate notional amount of Ps.1,500,000, at an annual variable rate of 28 days of TIIE and makes monthly payments based on the same notional amount at an annual fixed rate of 7.35%. The Company has recognized the change in fair value of this transaction as an accounting hedge, and recorded a cumulative loss of Ps.85,217 and Ps.30,702, in other comprehensive income or loss as of December 31, 2020 and 2019, respectively. In 2020, the Company recorded a loss of Ps.21,741 in consolidated other finance income or expense.
| (e) |  | In January 2018, the Company entered into a derivative transaction agreement (interest rate swap) through February 2023, to hedge the variable interest rate exposure resulting from a Mexican peso loan of a total principal amount of Ps.2,500,000. Under this transaction, the Company receives monthly payments based on aggregate notional amount of Ps.2,500,000, at an annual variable rate of 28 days of TIIE and makes monthly payments based on the same notional amount at an annual fixed rate of 7.7485%. The Company has recognized the change in fair value of this transaction as an accounting hedge, and recorded a cumulative loss of Ps.175,498 and Ps.83,122 in other comprehensive income or loss as of December 31, 2020 and 2019, respectively. In 2020, the Company recorded a loss of Ps.42,553 in consolidated other finance income or expense.
| (f) |  | In June and July 2019 and October 2020, the Company entered into a derivative transaction agreements (interest rate swap) through June 2024, to hedge the variable interest rate exposure resulting from a Mexican peso loan of a total principal amount of Ps.10,000,000 and Ps.6,000,000 as of December 31, 2020 and 2019, respectively. Under this agreements, the Company receives monthly payments based on aggregate notional amounts of Ps.10,000,000 and Ps.6,000,000, at an annual variable rate of 28 days of TIIE and makes monthly payments based on the same notional amount at an annual weighted average fixed rate of 6.7620%. The Company has recognized the change in fair value of this transaction as an accounting hedge, and recorded a cumulative loss of Ps.747,630 in other comprehensive income or loss as of December 31, 2020. In 2020, the Company recorded a loss of Ps.89,336 in consolidated other finance income or expense.
| (g) |  | As of December 31, 2020 and 2019, the Company had entered into derivative contracts of foreign currency (forwards) to fix the exchange rate for the purchase of U.S.$330.5 million and U.S.$218.7 million, respectively, at an average exchange rate of Ps.22.5859 and Ps.19.9256, respectively. The Company has recognized the change in fair value of this transaction as an accounting hedge, and recorded a cumulative loss of Ps.714,763 and Ps.144,466 for this transaction agreement in other comprehensive income or loss as of December 31, 2020, and 2019, respectively. In 2020 and 2019, the Company recorded a gain (loss) of Ps.308,562 and Ps.(107,440) in consolidated other finance income or expense, respectively.
| (h) |  | In March 2020, the Company entered into a derivative transaction agreement (interest rate swap) through March 2022, to hedge the variable interest rate exposure resulting from a Mexican peso loan of a total principal amount of Ps.9,385,347. Under this transaction, the Company receives monthly payments based on aggregate notional amounts of Ps.9,385,347, at an annual variable rate of 28 days of TIIE, and makes monthly payments based on the same notional amount at an annual fixed rate of 6.0246%. In 2020, the Company recorded a loss of Ps.274,285 in consolidated other finance income or expense.
| (i) |  | As of December 31, 2020, TVI had foreign currency contracts (forwards) in the aggregate notional amount of U.S.$88.4 million at an average rate of Ps.22.4570. As a result of the change in fair value of these agreements in the year ended December 31, 2020, the Company recorded a loss of Ps.3,482 in consolidated other finance income or expense.
| (j) |  | As of December 31, 2020, Empresas Cablevisión had foreign currency contracts (forwards) in the aggregate notional amount of U.S.$96.8 million at an average rate of Ps.22.4103 . As a result of the change in fair value of these agreements in the year ended December 31, 2020 the Company recorded a loss of Ps.300 in consolidated other finance income or expense.
| (k) |  | As of December 31, 2020, Sky had foreign currency contracts (forwards) in the aggregate notional amount of U.S.$135.0 million at an average rate of Ps.22.8411. As a result of the change in fair value of these agreements in the year ended December 31, 2020 the Company recorded a gain of Ps.43,419 in consolidated other finance income or expense.
| (l) |  | As of December 31, 2020 and 2019, the Company had foreign currency contracts (forward) in the aggregate notional amount of U.S.$344.9 million and U.S.$361.5 million at an average rate of Ps.22.4872 and Ps.19.9898 , respectively. As a result of the change in fair value of these agreements, in the years ended December 31, 2020 and 2019, the Company recorded a gain (loss) of Ps.207,412 and Ps.(820,585), in consolidated other finance income or expense, respectively.
Schedule of reconciliation for all assets and liabilities measured at fair value | Financial assets and liabilities measured at fair value as of December 31, 2020 and 2019:
|  |  |  |  | Quoted Prices in |  | Internal Models |  | Internal Models
|  | Balance as of |  | Active Markets |  | with Significant |  | with Significant
|  | December 31, |  | for Identical |  | Observable |  | Unobservable
|  | 2020 |  | Assets (Level 1) |  | Inputs (Level 2) |  | Inputs (Level 3)
Assets: |  |  |  |  |  |  |  |  |  |  |  |
At FVOCIL: |  |  |  |  |  |  |  |  |  |  |  |
Open-Ended Fund |  | Ps. | 1,135,803 |  | Ps. | — |  | Ps. | 1,135,803 |  | Ps. | —
Other equity instruments |  |  | 5,397,504 |  |  | 5,397,504 |  |  | — |  |  | —
Total |  | Ps. | 6,533,307 |  | Ps. | 5,397,504 |  | Ps. | 1,135,803 |  | Ps. | —
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Derivative financial instruments |  | Ps. | 3,476,223 |  | Ps. | — |  | Ps. | 3,476,223 |  | Ps. | —
Total |  | Ps. | 3,476,223 |  | Ps. | — |  | Ps. | 3,476,223 |  | Ps. | —
|  |  |  |  | Quoted Prices in |  | Internal Models |  | Internal Models
|  | Balance as of |  | Active Markets |  | with Significant |  | with Significant
|  | December 31, |  | for Identical |  | Observable |  | Unobservable
|  | 2019 |  | Assets (Level 1) |  | Inputs (Level 2) |  | Inputs (Level 3)
Assets: |  |  |  |  |  |  |  |  |  |  |  |
At FVOCIL: |  |  |  |  |  |  |  |  |  |  |  |
Open-Ended Fund |  | Ps. | 4,688,202 |  | Ps. | — |  | Ps. | 4,688,202 |  | Ps. | —
Other equity instruments |  |  | 5,751,001 |  |  | 5,751,001 |  |  | — |  |  | —
Warrants issued by UHI |  |  | 33,775,451 |  |  | — |  |  | — |  |  | 33,775,451
Derivative financial instruments |  |  | 4,592 |  |  | — |  |  | 4,592 |  |  | —
Total |  | Ps. | 44,219,246 |  | Ps. | 5,751,001 |  | Ps. | 4,692,794 |  | Ps. | 33,775,451
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Derivative financial instruments |  | Ps. | 915,290 |  | Ps. | — |  | Ps. | 915,290 |  | Ps. | —
Total |  | Ps. | 915,290 |  | Ps. | — |  | Ps. | 915,290 |  | Ps. | —
The table below presents the reconciliation for all assets and liabilities measured at fair value using internal models with significant unobservable inputs (Level 3) during the years ended December 31, 2020 and 2019:
|  | 2020 |  | 2019
Balance at beginning of year |  | Ps. | 33,775,451 |  | Ps. | 34,921,530
Included in other comprehensive income |  |  | (16,387,752) |  |  | (1,146,079)
Warrants exercised for common stock of UHI |  |  | (17,387,699) |  |  | —
Balance at the end of year |  | Ps. | — |  | Ps. | 33,775,451

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