Liberty Global Reports Preliminary Fiscal 2012 Results

  Liberty Global Reports Preliminary Fiscal 2012 Results

Record Subscriber Additions for Q4 and Full-Year 2012

Achieved 2012 Guidance Targets

Repurchased Approximately $1 Billion of Equity in 2012

Business Wire

ENGLEWOOD, Colo. -- February 5, 2013

Liberty Global, Inc. (“Liberty Global,” “LGI,” or the “Company”) (NASDAQ:
LBTYA, LBTYB and LBTYK), today announces its preliminary unaudited
consolidated financial and operating results for the year and three months
(“Q4”) ended December 31, 2012. We expect to publish our final consolidated
results for 2012 on February 13, 2013 after market close and conduct our 2012
earnings call on February 14, 2013. In addition, Liberty Global announced
today that it had signed an agreement to acquire Virgin Media. The details
regarding this acquisition are described in a separate press release issued
today by Liberty Global and Virgin Media.

Highlights for the full year and Q4 compared to the same period for 2011
(unless noted), include:^1

  *Organic RGU^2 additions increased 34% to 1.6 million in 2012, including
    465,000 in Q4
  *Revenue of $10.31 billion, including $2.73 billion in Q4

       *2012 rebased^3 revenue growth of 5.8%, including 6.5% in Q4

  *Operating Cash Flow (“OCF”)^4 of $4.87 billion in 2012, including $1.25
    billion in Q4

       *2012 rebased OCF growth of 4.1%, including 5.6% in Q4
       *Excluding VTR Wireless,^5 2012 rebased OCF growth was 5.2% and Q4
         rebased OCF growth was 6.5%

  *Operating income increased 9% to $1.98 billion for 2012 and 23% to $501
    million for Q4
  *Capital expenditures as a percentage of revenue of 16% for Q4 and 18% for
    2012, both reflecting significant declines over the corresponding prior
    year periods
  *2012 Adjusted Free Cash Flow (“Adjusted FCF”)^6 of $1.03 billion,
    including $594 million in Q4

       *Reflects year-over-year growth of 31% for 2012 and 62% for Q4

Key Subscriber Statistics^7

                          Organic Net Adds
                             Q4 2012              FY 2012
                             in thousands
Video                        (27.8    )                     (286.5   )
Internet                     249.1                          909.1
Telephony                    243.8                         971.4    
Total                        465.1                         1,594.0  
                                                            
                             Totals
                             FY 2011                        FY 2012
Total RGUs:                  in thousands
Video                        18,405.5                       18,308.5
Internet                     8,159.3                        9,244.3
Telephony^8                  6,225.3                       7,281.7  
Total                        32,790.1                      34,834.5 
                                                            
Homes Passed                 33,262.1                       34,193.5
2-Way Homes Passed           31,023.0                       32,190.4
                                                            
Customer Relationships       19,538.2                       19,788.2
                                                            

Summary of Debt, Capital Lease Obligations and Cash and Cash Equivalents

The following table^9 details the U.S. dollar equivalent balances of our
third-party consolidated debt, capital lease obligations and cash and cash
equivalents at December 31, 2012:

                               Capital        Debt and       Cash
                                     Lease             Capital           and Cash
                                                       Lease
                    Debt^10          Obligations       Obligations       Equivalents
                    in millions
LGI and its
non-operating       $ 1,243.4        $  13.6           $  1,257.0        $  701.3
subsidiaries
UPC Holding
(excluding            12,627.5          32.9              12,660.4          41.6
VTR Group)
Unitymedia            6,841.6           937.1             7,778.7           26.7
KabelBW
Telenet               4,666.2           405.1             5,071.3           1,196.0
Liberty               663.9             0.6               664.5             2.4
Puerto Rico
VTR Group^11          91.9              0.3               92.2              44.3
Other
operating            0.4              —                0.4              26.6
subsidiaries
Total LGI           $ 26,134.9       $  1,389.6        $  27,524.5         2,038.9
                                                                         
Restricted
cash for LGI
Telenet                                                                    1,069.0
Tender
released on
2/1/13^12
Adjusted Cash                                                              3,107.9
Position
                                                                         
Unused
Borrowing                                                                  2,237.5
Capacity^13
Total
Consolidated                                                             $  5,345.4
Liquidity
                                                                         

Summary of Consolidated Liquidity and Leverage Ratios

The following table highlights our consolidated leverage ratios^14 at December
31, 2012:

                                         Gross           Net
Consolidated Leverage Ratios                5.5x                      4.9x
Adjusted Consolidated Leverage Ratios       5.3x                      4.6x
                                                                      

Operating Cash Flow Reconciliation

                    Three months ended                      Year ended
                                                   
                    December 31,                            December 31,
                    2012           2011                  2012            2011
                    in millions
Total segment
operating
cash flow           $ 1,254.4         $ 1,099.5             $ 4,869.6          $ 4,482.3
from
continuing
operations
Stock-based
compensation          (21.9   )         (25.6   )             (112.4   )         (131.3   )
expense
Depreciation
and                   (681.4  )         (618.7  )             (2,691.1 )         (2,457.0 )
amortization
Impairment,
restructuring
and other            (50.4   )        (47.1   )            (83.0    )        (75.6    )
operating
items, net
Operating           $ 500.7          $ 408.1              $ 1,983.1         $ 1,818.4  
income
                                                                               

Free Cash Flow and Adjusted Free Cash Flow Reconciliation

                      Three months ended                     Year ended
                                                    
                      December 31,                           December 31,
                      2012           2011                 2012            2011
                      in millions
Net cash
provided by
operating             $ 1,033.5         $ 837.6              $ 2,858.5          $ 2,562.7
activities of
continuing
operations
Excess tax
benefits from           3.5               4.4                  7.2                37.7
stock-based
compensation^15
Cash payments
for direct              14.3              2.6                  33.8               19.6
acquisition
costs^16
Capital                 (432.9  )         (511.3 )             (1,883.6 )         (1,927.0 )
expenditures
Principal
payments on
vendor                  (44.8   )         (6.6   )             (104.7   )         (10.0    )
financing
obligations
Principal
payments on            (8.1    )        (3.2   )            (17.5    )        (11.4    )
certain capital
leases
FCF                   $ 565.5          $ 323.5             $ 893.7           $ 671.6    
                                                                                
FCF                   $ 565.5           $ 323.5              $ 893.7            $ 671.6
Payments
associated with
Old
Unitymedia’s            —                 —                    —                  12.9
pre-acquisition
capital
structure^17
FCF deficit of         28.3            44.1               139.8            106.5    
VTR Wireless
Adjusted FCF          $ 593.8          $ 367.6             $ 1,033.5         $ 791.0    
                                                                                           

Capital Expenditures

The table below highlights the categories of our property and equipment
additions for the indicated periods and reconciles those additions to the
capital expenditures that we present in our consolidated statements of cash
flows:

                      Three months ended                   Year ended
                                                  
                      December 31,                         December 31,
                      2012         2011                 2012           2011
                      in millions, except % amounts
Property and
equipment             $ 638.4         $ 674.1              $ 2,274.1         $ 2,131.6
additions
Assets acquired
under
capital-related         (94.2 )         (42.7  )             (246.5  )         (101.4  )
vendor
financing
arrangements
Assets acquired
under capital           (17.6 )         (11.5  )             (63.1   )         (38.2   )
leases
Changes in
current
liabilities            (93.7 )        (108.6 )            (80.9   )        (65.0   )
related to
capital
expenditures
Total capital         $ 432.9        $ 511.3             $ 1,883.6        $ 1,927.0 
expenditures^18
                                                                             
Property and
equipment               23.4  %         28.0   %             22.1    %         22.4    %
additions as %
of revenue
Capital
expenditures as         15.9  %         21.3   %             18.3    %         20.3    %
% of revenue
                                                                             

Additional Information and Where to Find it

Nothing in this press release shall constitute a solicitation to buy or
subscribe for or an offer to sell any securities of Liberty Global, Virgin
Media or the new Liberty Global holding company. In connection with the
proposed transaction, Liberty Global and Virgin Media will file a joint proxy
statement/prospectus with the SEC, and the new Liberty Global holding company
will file a Registration Statement on Form S-4 with the SEC. STOCKHOLDERS OF
EACH COMPANY AND OTHER INVESTORS ARE URGED TO READ THE REGISTRATION STATEMENT
AND JOINT PROXY STATEMENT/PROSPECTUS (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS
THERETO) REGARDING THE PROPOSED TRANSACTION WHEN THEY BECOME AVAILABLE BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION. Stockholders will be able to obtain a
free copy of the registration statement and joint proxy statement/prospectus,
as well as other filings containing information about Liberty Global, Virgin
Media and the new Liberty Global holding company, without charge, at the SEC's
Internet site (http://www.sec.gov). Copies of the registration statement and
joint proxy statement/prospectus and the filings with the SEC that will be
incorporated by reference therein can also be obtained, without charge, by
directing a request to Liberty Global, Inc., 12300 Liberty Boulevard,
Englewood, Colorado, 80112, USA, Attention: Investor Relations, Telephone: +1
303 220 6600, or to Virgin Media Limited, Communications House, Bartley Wood
Business Park, Bartley Way, Hook, RG27 9UP, United Kingdom, Attn: Investor
Relations Department, Telephone +44 (0) 1256 753037.

Participants in Solicitation

The respective directors and executive officers of Liberty Global and Virgin
Media and other persons may be deemed to be participants in the solicitation
of proxies in respect of the proposed transaction. Information regarding
Liberty Global's directors and executive officers is available in its proxy
statement filed with the SEC by Liberty Global on April 27, 2012, and
information regarding Virgin Media's directors and executive officers is
available in its proxy statement filed with the SEC by Virgin Media on April
30, 2012. Other information regarding the participants in the proxy
solicitation and a description of their direct and indirect interests, by
security holdings or otherwise, will be contained in the joint proxy
statement/prospectus and other relevant materials to be filed with the SEC
when they become available. These documents can be obtained free of charge
from the sources indicated above.

About Liberty Global

Liberty Global is the leading international cable company, with operations in
13 countries. We connect people to the digital world and enable them to
discover and experience its endless possibilities. Our market-leading
television, broadband internet and telephony services are provided through
next-generation networks and innovative technology platforms that connect 20
million customers who subscribe to 35 million services as of December 31,
2012.

Liberty Global’s consumer brands include UPC, Unitymedia, KabelBW, Telenet and
VTR. Our operations also include Chellomedia, our content division, UPC
Business, a commercial services division and Liberty Global Ventures, our
investment fund. For more information, please visit www.lgi.com or contact:

                                       
Investor Relations:                             Corporate Communications:
Christopher           +1 303.220.6693           Hanne Wolf    +1
Noyes                                                            303.220.6678
Oskar Nooij           +1 303.220.4218           Bert             +31
                                                Holtkamp         20.778.9800
                                                                 

Notes  
          We began accounting for Austar United Communications Limited
          (“Austar”) as a discontinued operation effective December 31, 2011.
          The results of operations, subscriber metrics and cash flows of
^1      Austar have been classified as a discontinued operation for all
          periods presented. Accordingly, the financial and statistical
          information presented herein includes only our continuing
          operations, unless otherwise indicated.
          Revenue Generating Unit (“RGU”) is separately an Analog Cable
          Subscriber, Digital Cable Subscriber, DTH Subscriber, MMDS
          Subscriber, Internet Subscriber or Telephony Subscriber. Organic
^2        figures exclude RGUs of acquired entities at the date of
          acquisition, but include the impact of changes in RGUs from the date
          of acquisition. All subscriber/RGU additions or losses refer to net
          organic changes, unless otherwise noted.
          For purposes of calculating rebased growth rates on a comparable
          basis for all businesses that we owned during 2011 and 2012, we have
          adjusted our historical revenue and OCF for the three months and
          year ended December 31, 2011 to (i) include the pre-acquisition
          revenue and OCF of certain entities acquired during 2011 and 2012 in
          the respective 2011 rebased amounts to the same extent that the
^3        revenue and OCF of such entities are included in our 2012 results,
          (ii) exclude a small disposition to the extent that the revenue and
          OCF are included in our 2011 results and (iii) reflect the
          translation of our rebased amounts for the 2011 periods at the
          applicable average exchange rates that were used to translate our
          2012 results. For additional information regarding our rebased
          growth calculations, please see page 11 of our third quarter 2012
          earnings release dated November 4, 2012.
          As we use the term, operating cash flow is defined as revenue less
          operating and selling, general and administrative expenses
          (excluding stock-based compensation, depreciation and amortization,
          provisions for litigation and impairment, restructuring and other
          operating items). Other operating items include (i) gains and losses
          on the disposition of long-lived assets, (ii) direct acquisition
          costs, such as third-party due diligence, legal and advisory costs,
          and (iii) other acquisition-related items, such as gains and losses
          on the settlement of contingent consideration. Our internal decision
          makers believe operating cash flow is a meaningful measure and is
          superior to available GAAP measures because it represents a
          transparent view of our recurring operating performance that is
^4        unaffected by our capital structure and allows management to (i)
          readily view operating trends, (ii) perform analytical comparisons
          and benchmarking between segments and (iii) identify strategies to
          improve operating performance in the different countries in which we
          operate. We believe our operating cash flow measure is useful to
          investors because it is one of the bases for comparing our
          performance with the performance of other companies in the same or
          similar industries, although our measure may not be directly
          comparable to similar measures used by other public companies.
          Operating cash flow should be viewed as a measure of operating
          performance that is a supplement to, and not a substitute for,
          operating income, net earnings (loss), cash flow from operating
          activities and other GAAP measures of income or cash flows.
^5        Represents our consolidated rebased growth rate, excluding the
          incremental OCF deficit of VTR Wireless SA (“VTR Wireless”).
          Free Cash Flow (“FCF”) is defined as net cash provided by our
          operating activities, plus (i) excess tax benefits related to the
          exercise of stock incentive awards and (ii) cash payments for direct
          acquisition costs, less (a) capital expenditures, as reported in our
          consolidated cash flow statements, (b) principal payments on vendor
          financing obligations and (c) principal payments on capital leases
          (exclusive of the portions of the network lease in Belgium and the
          duct leases in Germany that we assumed in connection with certain
          acquisitions), with each item excluding any cash provided or used by
          our discontinued operations. We believe that our presentation of
          free cash flow provides useful information to our investors because
^6        this measure can be used to gauge our ability to service debt and
          fund new investment opportunities. Free cash flow should not be
          understood to represent our ability to fund discretionary amounts,
          as we have various mandatory and contractual obligations, including
          debt repayments, which are not deducted to arrive at this amount.
          Investors should view free cash flow as a supplement to, and not a
          substitute for, GAAP measures of liquidity included in our
          consolidated cash flow statements. We also present Adjusted FCF,
          which adjusts FCF to eliminate the incremental FCF deficit
          associated with the VTR Wireless mobile initiative and, during 2011,
          the payments associated with the capital structure of the
          predecessor of Unitymedia KabelBW GmbH (“Old Unitymedia”).
          For further information regarding certain operating data and
^7        subscriber definitions, please see pages 20-21 of our third quarter
          2012 earnings release dated November 4, 2012.
          We do not include subscriptions to mobile services in our externally
          reported RGU counts. In this regard, our December 31, 2012 RGU
^8        counts exclude 521,600, 132,400, 48,300, 34,500, 3,500 and 2,800
          postpaid subscriber identification module (“SIM”) cards in service
          in Belgium, Germany, Chile, Poland, the Netherlands and Hungary,
          respectively, and 89,900 prepaid SIM cards in service in Chile.
^9        Except as otherwise indicated, the amounts reported in the table
          include the named entity and its subsidiaries.
          Debt amounts for UPC Holding and Telenet include senior secured
^10       notes issued by special purpose entities that are consolidated by
          each.
^11       Of these amounts, VTR Wireless accounts for $92 million of the debt
          and $9 million of the cash of VTR Group.
          On December 17, 2012, we launched a voluntary and conditional cash
          public offer, at an offer price of €35.00 per share, for (i) all of
          Telenet's issued shares that we did not already own or that were not
          held by Telenet and (ii) certain of Telenet’s outstanding vested and
          unvested employee warrants (the “LGI Telenet Tender”). Pursuant to
          the LGI Telenet Tender, which was completed on February 1, 2013, we
^12       acquired (i) 9,497,637 of Telenet’s issued shares, and (ii) 3,000 of
          the outstanding and vested warrants. In connection with the launch
          of the LGI Telenet Tender, we were required to place €1,142.5
          million ($1,507.8 million) of cash into a restricted account. On
          February 1, 2013, we used €332.5 million ($438.8 million) of this
          restricted cash account to fund the LGI Telenet Tender and the
          remaining amount was released from restrictions.
          The $2.2 billion amount reflects the aggregate unused borrowing
          capacity, as represented by the maximum undrawn commitments under
^13       our subsidiaries’ applicable facilities without regard to covenant
          compliance calculations. Upon completion of our Q4 2012 compliance
          reporting, we would expect to be able to borrow approximately $1.8
          billion of this aggregate borrowing capacity.
          Our gross and net debt ratios are defined as total debt and net debt
          to annualized OCF of the latest quarter. Net debt is defined as
          total debt less cash and cash equivalents. Additionally, our cash
^14       and cash equivalent balance for these purposes include restricted
          cash that was released from restrictions after completion of the LGI
          Telenet Tender offer, subsequent to year-end. For our adjusted
          ratios, the debt amount excludes the $1.1 billion loan that is
          backed by the shares we hold in Sumitomo Corporation.
          Excess tax benefits from stock-based compensation represent the
          excess of tax deductions over the related financial reporting
          stock-based compensation expense. The hypothetical cash flows
^15       associated with these excess tax benefits are reported as an
          increase to cash flows from financing activities and a corresponding
          decrease to cash flows from operating activities in our consolidated
          cash flow statements.
^16       Represents costs paid during the period to third parties directly
          related to acquisitions.
          Represents derivative payments on the pre-acquisition capital
          structure of Old Unitymedia during the post-acquisition period.
          These payments were reflected as a reduction of cash provided by
^17       operations in our consolidated cash flow statement for the year
          ended December 31, 2011. Old Unitymedia’s pre-acquisition debt was
          repaid on March 2, 2010 with part of the proceeds of the debt
          incurred for the Unitymedia acquisition.
          The capital expenditures that we report in our consolidated cash
          flow statements do not include amounts that are financed under
^18       vendor financing or capital lease arrangements. Instead, these
          expenditures are reflected as non-cash additions to our property and
          equipment when the underlying assets are delivered, and as
          repayments of debt when the related principal is repaid.

Contact:

Liberty Global, Inc.
Investor Relations:
Christopher Noyes, +1 303.220.6693
Oskar Nooij, +1 303.220.4218
or
Corporate Communications:
Hanne Wolf, +1 303.220.6678
Bert Holtkamp, +31 20.778.9800
 
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