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Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2021

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, 2021 and 2020, were as follows:

2021

2020

Carrying Amount

Fair Value

Carrying Amount

Fair Value

Assets:

Cash and cash equivalents

Ps.

25,828,215

Ps.

25,828,215

Ps.

29,058,093

Ps.

29,058,093

Trade notes and accounts receivable, net

13,093,011

13,093,011

12,343,797

12,343,797

Long-term loan and interests receivable from GTAC (see Note 10)

755,973

760,143

821,253

824,092

Open-Ended Fund (see Note 9)

945,176

945,176

1,135,803

1,135,803

Publicly traded equity instruments (see Note 9)

3,517,711

3,517,711

5,397,504

5,397,504

Other equity instruments (see Note 9)

1,607,969

1,607,969

468,552

468,552

Liabilities:

Senior Notes due 2025, 2032 and 2040

Ps.

30,754,650

Ps.

39,592,552

Ps.

29,923,950

Ps.

40,584,237

Senior Notes due 2045

20,503,100

24,205,140

19,949,300

24,282,886

Senior Notes due 2037 and 2043

11,000,000

8,722,100

11,000,000

9,238,435

Senior Notes due 2026 and 2046

24,603,720

31,714,380

23,939,160

31,811,792

Senior Notes due 2049

15,377,325

19,307,154

14,961,975

18,978,667

Notes due 2027

4,500,000

4,509,405

4,500,000

5,035,860

Long-term notes payable to Mexican banks

20,260,404

20,417,854

19,602,893

19,801,142

Lease liabilities

9,680,559

9,830,878

9,292,351

9,343,100

The carrying amounts (based on estimated fair values), notional amounts, and maturity dates of the Group’s derivative financial instruments as of December 31, 2021 and 2020, were as follows:


					Notional
					Amount
December 31, 2021:		Carrying			(U.S. Dollars in
Derivative Financial Instruments		Amount			Thousands)			Maturity Date
Assets:
Derivatives recorded as accounting hedges (cash flow hedges):
TVI’s interest rate swap ^(a)		Ps.	127		Ps.	87,600		May 2022
Interest rate swaps ^(b)			133,197		Ps.	10,000,000		June 2024
Total assets		Ps.	133,324

Liabilities:
Derivatives recorded as accounting hedges (cash flow hedges):
TVI’s interest rate swap ^(c)		Ps.	2,015		Ps.	522,804		April 2022
Interest rate swaps ^(d)			9,749		Ps.	2,000,000		October 2022
Interest rate swaps ^(e)			7,243		Ps.	1,500,000		October 2022
Interest rate swaps ^(f)			23,798		Ps.	2,500,000		February 2023
Forwards ^(g)			35,524		U.S.$	67,125		January 2022 through March 2022
Derivatives not recorded as accounting hedges:
Interest rate swap ^(h)			2,943		Ps.	9,385,347		March 2022
TVI’s forwards ⁽ⁱ⁾			10,057		U.S.$	12,600		January 2022 through February 2022
Empresas Cablevisión’s forwards ^(j)			11,006		U.S.$	13,820		January 2022 through February 2022
Sky’s forwards ^(k)			14,054		U.S.$	15,000		February 2022
Forwards ^(l)			56,496		U.S.$	57,620		January 2022 through February 2022
Total liabilities		Ps.	172,885


					Notional
					Amount
December 31, 2020:		Carrying			(U.S. Dollars in
Derivative Financial Instruments		Amount			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 ^(c)			23,784		Ps.	730,493		April 2022
Interest rate swaps ^(d)			109,146		Ps.	2,000,000		October 2022
Interest rate swaps ^(e)			86,171		Ps.	1,500,000		October 2022
Interest rate swaps ^(f)			180,941		Ps.	2,500,000		February 2023
Interest rate swaps ^(b)			762,827		Ps.	10,000,000		June 2024
Forwards ^(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 forwards ⁽ⁱ⁾			176,868		U.S.$	88,353		January 2021 through February 2022
Empresas Cablevisión’s forwards ^(j)			190,726		U.S.$	96,789		January 2021 through February 2022
Sky’s forwards ^(k)			318,701		U.S.$	135,000		February 2021 through February 2022
Forwards ^(l)			706,287		U.S.$	344,898		January 2021 through February 2022
Total liabilities		Ps.	3,476,223

(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.87,600 and Ps.122,400 as of December 31, 2021 and 2020, respectively. Under these agreements, the Company receives monthly payments based on aggregate notional amounts of Ps.87,600 and Ps.122,400 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.58,847 and Ps.60,730 in other comprehensive income or loss as of December 31, 2021 and 2020, respectively. In the years ended as of December 31, 2021 and 2020, TVI recorded a (loss) gain of Ps.(1,118) and Ps.2,046, respectively, in consolidated other finance income or expense.

(b)

In June and July 2019 and October 2020, the Company entered into derivative transaction agreements (interest rate swaps) 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 as of December 31, 2021 and 2020. Under these agreements, the Company receives monthly payments based on aggregate notional amounts of Ps.10,000,000 as of December 31, 2021 and 2020, 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.143,819 in other comprehensive income or loss as of December 31, 2021. In 2021, the Company recorded a loss of Ps.226,192 in consolidated other finance income or expense.

(c)

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.522,804 and Ps.730,493 as of December 31, 2021 and 2020, respectively. Under these agreements, the Company receives monthly payments based on aggregate notional amounts of Ps.522,804 and Ps.730,493 as of December 31, 2021 and 2020, 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.2,015 and Ps.23,784 in other comprehensive income or loss as of December 31, 2021 and 2020, respectively. TVI recorded a loss of Ps.17,501 and Ps.11,700 for this transaction agreement in consolidated other finance income or expense as of December 31, 2021 and 2020, respectively.

(d)

In November 2017, the Company entered into derivative transaction agreements (interest rate swaps) 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.9,031 and Ps.107,884 in other comprehensive income or loss as of December 31, 2021 and 2020, respectively. In 2021 and 2020, the Company recorded a loss of Ps.56,263 and Ps.28,719, respectively, in consolidated other finance income or expense.

(e)

In November and December 2017, the Company entered into derivative transaction agreements (interest rate swaps) 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.6,697 and Ps.85,217 in other comprehensive income or loss as of December 31, 2021 and 2020, respectively. In 2021, the Company recorded a loss of Ps.42,555 in consolidated other finance income or expense.

(f)

In January 2018, the Company entered into derivative transaction agreements (interest rate swaps) 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.19,612 and Ps.175,498 in other comprehensive income or loss as of December 31, 2021 and 2020, respectively. In 2021, the Company recorded a loss of Ps.81,759 in consolidated other finance income or expense.

(g)

As of December 31, 2021 and 2020, the Company had entered into derivative contracts of foreign currency (forwards) to fix the exchange rate for the purchase of U.S.$67.1 million and U.S.$330.5 million, respectively, at an average exchange rate of Ps.21.1433 and Ps.22.5859, respectively. The Company has recognized the change in fair value of this transaction as an accounting hedge, and recorded a cumulative loss of Ps.35,524 and Ps.714,763 for this transaction agreement in other comprehensive income or loss as of December 31, 2021, and 2020, respectively. In 2021 and 2020, the Company recorded a (loss) gain of Ps.(725,209) and Ps.308,562 in consolidated other finance income or expense, respectively.

(h)

In March 2020, the Company entered into derivative transaction agreements (interest rate swaps) 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 2021 and 2020, the Company recorded a gain (loss) of Ps.62,679 and Ps.(274,285) in consolidated other finance income or expense, respectively.

(i)

As of December 31, 2021, TVI had foreign currency contracts (forwards) in the aggregate notional amount of U.S.$12.6 million at an average rate of Ps.21.4394. As a result of the change in fair value of these agreements in the year ended December 31, 2021, the Company recorded a loss of Ps.9,812 in consolidated other finance income or expense.

(j)

As of December 31, 2021, Empresas Cablevisión had foreign currency contracts (forwards) in the aggregate notional amount of U.S.$13.8 million at an average rate of Ps.21.4352. As a result of the change in fair value of these agreements in the year ended December 31, 2021, the Company recorded a loss of Ps.8,926 in consolidated other finance income or expense.

(k)

As of December 31, 2021, Sky had foreign currency contracts (forwards) in the aggregate notional amount of U.S.$15.0 million at an average rate of Ps.21.6000. As a result of the change in fair value of these agreements in the year ended December 31, 2021, the Company recorded a loss of Ps.20,077 in consolidated other finance income or expense.

(l)

As of December 31, 2021 and 2020, the Company had foreign currency contracts (forwards) in the aggregate notional amount of U.S.$57.6 million and U.S.$344.9 million at an average rate of Ps.21.5927 and Ps.22.4872, respectively. As a result of the change in fair value of these agreements, in the years ended December 31, 2021 and 2020, the Company recorded a (loss) gain of Ps.(56,447) and Ps.207,412, 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, 2021 and 2020:

Quoted Prices in

Internal Models

Internal Models

Balance as of

Active Markets

with Significant

with Significant

December 31,

for Identical

Observable

Unobservable

2021

Assets (Level 1)

Inputs (Level 2)

Inputs (Level 3)

Assets:

At FVOCIL:

Open-Ended Fund

Ps.

945,176

Ps.

—

Ps.

945,176

Ps.

—

Publicly traded equity instruments

3,517,711

3,517,711

—

—

Derivative financial instruments

133,324

—

133,324

—

Total

Ps.

4,596,211

Ps.

3,517,711

Ps.

1,078,500

Ps.

—

Liabilities:

Derivative financial instruments

Ps.

172,885

Ps.

—

Ps.

172,885

Ps.

—

Total

Ps.

172,885

Ps.

—

Ps.

172,885

Ps.

—

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.

—

Publicly traded 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.

—

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, 2021 and 2020:


		2021			2020
Balance at beginning of year		Ps.	—		Ps.	33,775,451
Included in other comprehensive income			—			(16,387,752)
Warrants exercised for common stock of UHI			—			(17,387,699)
Balance at the end of year		Ps.	—		Ps.	—