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UPC Holding Reports 2012 Results

  UPC Holding Reports 2012 Results

Business Wire

AMSTERDAM -- February 14, 2013

UPC Holding B.V. (“UPC Holding”) is today providing selected, preliminary
unaudited financial and operating information for the three months (“Q4”) and
year ended December 31, 2012. UPC Holding is a wholly-owned subsidiary of
Liberty Global, Inc. (“Liberty Global”) (NASDAQ: LBTYA, LBTYB and LBTYK). A
copy of this press release will be posted to Liberty Global’s website
(www.lgi.com). In addition, UPC Holding’s consolidated financial statements
with the accompanying notes are expected to be posted prior to the end of
March 2013.

Financial and operating highlights for the year ended December 31, 2012, as
compared to the results for the same period last year (unless noted), include:

  *Organic RGU^1 additions increased 7% to 711,000, including 222,000 in Q4

       *Highest annual RGU additions since 2007

  *Revenue increased 6% to €4.27 billion, representing rebased^2 growth of 3%
  *Operating cash flow (“OCF”)^3 improved 7% to €2.07 billion, reflecting
    rebased growth of 4%

       *Achieved Q4 rebased OCF growth of 6%

  *Operating income increased by 11% year-over-year to €1.0 billion
  *Capital expenditures as a percentage of revenue declined to 17%
  *Over 75% of consolidated third-party debt is due in 2017 and beyond

Financial Results

For the three months and year ended December 31, 2012, our consolidated
revenue increased by 7% to €1.09 billion and 6% to €4.27 billion respectively,
as compared to the corresponding prior year periods. Besides acquisitions,
including Aster in Poland, and favorable foreign currency (“FX”) movements,
our revenue growth for both periods primarily resulted from continued volume
growth in RGUs. Neutralizing the impact of acquisitions and FX, we achieved
year-over-year rebased revenue growth of 3% for both the three-month and
full-year 2012 periods. For the last three years, our annual rebased revenue
growth has consistently averaged 3%.

Geographically, our European operations (“UPC Europe”) achieved rebased growth
of 3% in 2012, with our Western European and our Central and Eastern European
(“CEE”) regions posting rebased revenue growth of 4% and a modest decline of
1%, respectively. Our top-performing European markets for 2012 in terms of
rebased revenue growth were our Irish and our Dutch businesses. One particular
highlight in 2012 was the performance of UPC Cablecom in Switzerland. Gaining
momentum throughout the year, our Swiss business delivered rebased revenue
growth of 4% in 2012, up from 2% in 2011. Turning to South America, our
Chilean operations (“VTR”) realized rebased revenue growth of 4%, matching the
result of our Western European region.

We increased our OCF by 10% to €537 million and 7% to €2.07 billion for the
three months and year ended December 31, 2012, respectively, as compared to
the corresponding prior year periods. This OCF growth reflects the positive
impact of our organic growth, acquisitions and, to a lesser extent, favorable
FX movements. On a rebased basis, we delivered year-over-year growth of 6% for
Q4 and 4% for the full year. For 2012, we delivered year-over-year rebased OCF
growth of 5% in our Western European region with particularly strong
contributions from our Irish and Dutch businesses, which grew 11% and 6%,
respectively. In addition, our Swiss operation improved its rebased OCF growth
to 5% in 2012, its strongest result in the last four years. Rounding out our
other operations, CEE’s rebased OCF was flat for the second year in a row, and
in Chile, we posted rebased OCF growth of 8% for 2012, its strongest showing
since 2008.

Our consolidated OCF margins^4 increased by 130 basis points to 49.2% in Q4
and 50 basis points to 48.6% for full-year 2012, as compared to the
corresponding prior year periods. Specifically, for full-year 2012, our
Western European and CEE businesses attained OCF margins of 55.8% and 49.8%,
respectively, with each experiencing year-over-year OCF margin improvement of
approximately 100 basis points. With respect to Western Europe, each of our
operations delivered improved OCF margins. Moving to Chile, we achieved a
44.0% OCF margin in 2012, which reflected a 160 basis point improvement over
Chile’s OCF margin of 42.4% in 2011. The overall OCF margin improvements for
UPC Holding were partially offset by increased costs in our European central
and other operations during the 2012 periods as compared to the corresponding
periods in 2011.

For the year ended December 31, 2012, we reported capital expenditures of €724
million, reflecting a decline of approximately €58 million from 2011. As a
percentage of revenue, our capital expenditures decreased from 19% of revenue
in 2011 to 17% of revenue in 2012. This was in the middle of our target range
of 16% to 18% on a consolidated basis. The annual decline was attributable in
large part to our working capital efforts, as our non-cash vendor financing
arrangements were €87 million higher year-over-year. Additionally, our total
property and equipment additions, which include our capital expenditures on an
accrual basis and our vendor financing, capital lease and other non-cash
additions, declined year-over-year from 22% of revenue in 2011 to 21% of
revenue in 2012, despite our stronger subscriber growth in 2012 compared to
the prior year.

Subscriber Statistics

At December 31, 2012, we provided our 10.3 million unique customers with 18.7
million services, consisting of 9.3 million video, 5.5 million broadband
internet and 4.0 million telephony subscriptions. As compared to year-end
2011, we increased our RGU base by 5% or over 900,000 RGUs. This growth was
driven by over 700,000 organic RGU additions, as well as RGUs from the
inclusion of our historical small office home office (“SOHO”) business^5 and
from multiple small in-market acquisitions. During 2012, we increased our
combined double- and triple-play customers by 388,000 or 8% (inclusive of
acquisitions) to over 5 million bundled customers, or 50% of our customer
base. As a result, our bundling ratio increased from 1.73x RGUs per customer
at the end of 2011 to 1.81x RGUs per customer at the end of 2012.

Our subscriber additions increased by 7% year-over-year to 711,000 RGUs in
2012, with 222,000 RGUs added in the fourth quarter. Our 2012 result
represents our strongest performance since 2007 and our Q4 2012 result
reflects our second highest quarterly total since Q4 2007. Our subscriber
additions for the three months and year ended 2012 include 23,000 and 71,000
RGUs, respectively, relating to SOHO RGUs.

Geographically, our European operations accounted for over 85% of our total
RGU additions in 2012. Our Western European businesses added 278,000 RGUs
during the year, which was largely flat as compared to 2011. We had strong
performances in both Switzerland and Austria, which added 123,000 RGUs on a
combined basis in 2012 versus 46,000 RGUs in 2011. In particular, our Swiss
operation reported its best subscriber performance since 2006 with 80,000 RGU
additions. Offsetting our Swiss and Austrian improved performances, our Dutch
business faced a more competitive environment in the second half of 2012 and,
as a result, added 55,000 RGUs in 2012 as compared to 137,000 in 2011.
Rounding out our European footprint, our CEE operations grew their RGU
additions by 24% in 2012, gaining 329,000 RGUs. This was our highest annual
total since 2007 in that region, with both our Romanian and Hungarian
operations showing dramatic year-over-year improvement. Finally, our Chilean
operation realized a 7% decline in RGU additions to 105,000 in 2012.

In terms of our TV business, we lost 169,000 video subscribers (including just
12,000 in Q4) in 2012, which is slightly better than our 2011 result, and
represented our lowest annual RGU attrition since 2006. We finished 2012 with
a digital video base of 5.2 million RGUs, as we added 497,000 digital cable
RGUs (including 141,000 in Q4) during the year. As a result of our growth in
digital subscribers, we achieved a digital penetration^6 of 61%, as compared
to 54% at year-end 2011. We expect that our opportunity to continue driving
digital upgrades will be enhanced by our recently launched Horizon TV product
and with over 3 million analog video subscribers, we remain confident in the
video growth opportunity. The take-up of Horizon TV in the Dutch market
remained robust during the fourth quarter and within five short months we have
sold over 100,000 Horizon TV subscriptions and have over 200,000 unique users
enjoying our on-line and multiscreen services. In January 2013, we introduced
Horizon TV in Switzerland and the early results so far have been very positive
and we look forward to launching Horizon TV in Ireland later this year.

Overall subscriber growth was powered by our market-leading double- and
triple-play bundles, with our superior broadband internet products serving as
the key competitive differentiator. As a result of continued strong demand
from within our customer base, we added 403,000 broadband internet subscribers
(including 113,000 in Q4) and 477,000 telephony subscribers (including 122,000
in Q4), reflecting a year-over-year decline of 4% for broadband internet, but
an increase of 16% for telephony, which represents a record level for annual
telephony additions.

Summary of Third-Party Debt and Cash and Cash Equivalents

At December 31, 2012, we reported €9.6 billion of third-party debt and €58
million of cash and cash equivalents. As compared to September 30, 2012, our
third-party debt remained relatively constant, decreasing €62 million. At
December 31, 2012, over 75% of our third-party debt was due in 2017 and
beyond, while our fully-swapped borrowing cost^7 declined to approximately
7.8% at Q4 2012 from 8.8% at Q4 2011, due to a combination of attractive
pricing on our new debt issuances and lower costs associated with our
derivative instruments.

During 2012, we completed several opportunistic financing transactions, which
enabled us to extend our maturity profile, lower our borrowing cost, and raise
new capital. In the fourth quarter, we rolled our existing $500 million of
commitments under Facility AB due 2017 into a new Facility AF, which matures
in 2021.

The following table details our consolidated third-party debt and cash and
cash equivalents as of the dates indicated:^8

                                                 December 31,  September 30,
                                                  2012           2012
                                                  in millions
UPC Broadband Holding Bank Facility               €   4,142.5    €    4,170.6
UPCB Finance Limited 7.625% Senior Secured            496.6           496.5
Notes due 2020
UPCB Finance II Limited 6.375% Senior Secured         750.0           750.0
Notes due 2020
UPCB Finance III Limited 6.625% Senior Secured        757.7           776.7
Notes due 2020
UPCB Finance V Limited 7.25% Senior Secured           568.3           582.5
Notes due 2021
UPCB Finance VI Limited 6.875% Senior Secured         568.3           582.5
Notes due 2022
UPC Holding 8.00% Senior Notes due 2016               300.0           300.0
UPC Holding 9.75% Senior Notes due 2018               380.5           379.8
UPC Holding 9.875% Senior Notes due 2018              286.8           293.4
UPC Holding 8.375% Senior Notes due 2020              640.0           640.0
UPC Holding 6.375% Senior Notes due 2022              594.7           594.6
Other debt, including vendor financing and           108.3          89.2
capital lease obligations
Total third-party debt                            €   9,593.7    €    9,655.8
                                                                 
Cash and cash equivalents                         €   58.3       €    71.0
                                                                      

UPC Broadband Holding Bank Facility

The following table details the key terms of the UPC Broadband Holding Bank
Facility at December 31, 2012:

                           As of December 31, 2012
              Final          Interest     Facility    Unused      Carrying
Facility      maturity       rate        amount^9   borrowing  value^10
                                                      capacity
                                          in millions
                                                                  
Facility Q    July 31,       E + 2.75%    € 30.0      € 30.0      € —
              2014
Facility R    Dec. 31,       E + 3.25%    € 290.7       —           290.7
              2015
Facility S    Dec. 31,       E + 3.75%    € 1,204.5     —           1,204.5
              2016
Facility T    Dec. 31,       L + 3.50%    $ 260.2       —           196.1
              2016
Facility U    Dec. 31,       E + 4.00%    € 750.8       —           750.8
              2017
Facility V    Jan. 15,       7.625%       € 500.0       —           500.0
              2020
Facility W    Mar. 31,       E + 3.00%    € 144.1       144.1       —
              2015
Facility X    Dec. 31,       L + 3.50%    $ 1,042.8     —           790.2
              2017
Facility Y    July 1,        6.375%       € 750.0       —           750.0
              2020
Facility Z    July 1,        6.625%       $ 1,000.0     —           757.7
              2020
Facility      July 31,       E + 3.25%    € 904.0       904.0       —
AA            2016
Facility      Nov. 15,       7.250%       $ 750.0       —           568.3
AC            2021
Facility      Jan. 15,       6.875%       $ 750.0       —           568.3
AD            2022
Facility      Dec. 31,       E + 3.75%    € 535.5       —           535.5
AE            2019
Facility      Jan. 31,       L +          $ 500.0       —           374.7
AF            2021           3.00%^11
Elimination of Facilities V, Y, Z, AC and AD in        —          (3,144.3 )
consolidation
Total                                                 € 1,078.1   € 4,142.5  
                                                                             

Borrowing Capacity & Covenant Calculations

UPC Broadband Holding B.V. (“UPC Broadband Holding”), our wholly-owned
subsidiary, is a borrower of outstanding indebtedness under the UPC Broadband
Holding Bank Facility, which we guarantee. As of December 31, 2012, UPC
Broadband Holding had maximum undrawn commitments under Facilities Q, W and AA
of the UPC Broadband Holding Bank Facility of €1.1 billion. We estimate that
approximately €789 million of this amount will be available upon completion of
our fourth quarter compliance reporting requirements.

Based on the results ended December 31, 2012 and subject to the completion of
our fourth quarter bank reporting requirements, (i) the ratio of Senior Debt
to Annualized EBITDA (last two quarters annualized), as defined and calculated
in accordance with the UPC Broadband Holding Bank Facility, was 3.64x and (ii)
the ratio of Total Debt to Annualized EBITDA (last two quarters annualized),
as defined and calculated in accordance with the UPC Broadband Holding Bank
Facility, was 4.66x.^12

About UPC Holding

UPC Holding connects people to the digital world and enables 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 in 10 countries that connect 10
million customers who subscribe to 19 million services as of December 31,
2012.

Disclaimer

This press release contains forward-looking statements, including our
expectations with respect to our strategy and future growth prospects,
including our continued ability to increase our organic RGU additions and
further grow the penetration of our advanced services and our assessment of
our liquidity and access to capital markets, including our borrowing
availability; our expectations with respect to the timing and impact of our
expanded roll-out of advanced products and services, including Horizon TV; our
insight and expectations regarding competitive and economic factors in our
markets; the impact of our M&A activity on our operations and financial
performance; and other information and statements that are not historical
fact. These forward-looking statements involve certain risks and uncertainties
that could cause actual results to differ materially from those expressed or
implied by these statements. These risks and uncertainties include the
continued use by subscribers and potential subscribers of our services and
their willingness to upgrade to our more advanced offerings, our ability to
meet challenges from competition and economic factors, the continued growth in
services for digital television at a reasonable cost, the effects of changes
in technology and regulation, our ability to achieve expected operational
efficiencies and economies of scale, our ability to generate expected revenue
and operating cash flow, control property and equipment additions as measured
by a percentage of revenue and achieve assumed margins, the impact of our
future financial performance, or market conditions generally, on the
availability, terms and deployment of capital, as well as other factors
detailed from time to time in Liberty Global's filings with the Securities and
Exchange Commission including Liberty Global’s most recently filed Form 10-K.
These forward-looking statements speak only as of the date of this release. We
expressly disclaim any obligation or undertaking to disseminate any updates or
revisions to any forward-looking statement contained herein to reflect any
change in our expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based.

We are required under the terms of the indentures for the UPC Holding senior
notes and the UPCB Finance Limited, UPCB Finance II Limited, UPCB Finance III
Limited, UPCB Finance V Limited and UPCB Finance VI Limited senior secured
notes to provide certain financial information regarding UPC Holding to
bondholders on a quarterly basis. UPC Broadband Holding, our wholly-owned
subsidiary, is a borrower and we are a guarantor of outstanding indebtedness
under the UPC Broadband Holding Bank Facility, which also requires the
provision of certain financial and related information to the lenders. This
press release is being issued at this time, in connection with those
obligations, due to the contemporaneous release by Liberty Global of its
December 31, 2012 results. The financial information contained herein is
preliminary and subject to change. We presently expect to issue our December
31, 2012 audited consolidated financial statements prior to the end of March
2013, at which time they will be posted to the investor relations section of
the Liberty Global website (www.lgi.com) under the fixed income heading.
Copies will also be available from the Trustee for the senior notes and the
senior secured notes.

    
      Please see footnotes to the operating data table for the definition of
      revenue generating units (“RGUs”). Organic figures exclude RGUs of
^1    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
^2    rebased amounts to the same extent that the revenue and OCF of such
      entities are included in our 2012 results and (ii) 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. Please see page 7 for supplemental information on rebased
      growth.
^3    Please see page 10 for our definition of operating cash flow and a
      reconciliation to operating income.
^4    OCF margin is calculated by dividing OCF by total revenue for the
      applicable period.
      Certain of our business-to-business (“B2B”) revenue is derived from SOHO
      subscribers that pay a premium price to receive enhanced service levels
      along with video, internet or telephony services that are the same or
      similar to the mass marketed products offered to our residential
      subscribers. Effective January 1, 2012, we recorded non-organic
      adjustments to begin including the SOHO subscribers of UPC Europe in our
      RGU and customer counts. As a result, all mass marketed products
^5    provided to SOHOs, whether or not accompanied by enhanced service levels
      and/or premium prices, are now included in the respective RGU and
      customer counts of our broadband communications operations, with only
      those services provided at premium prices considered to be “SOHO RGUs”
      or “SOHO customers.” With the exception of our B2B SOHO subscribers, we
      generally do not count customers of B2B services as customers or RGUs
      for external reporting purposes. RGU, customer, bundling and ARPU
      amounts presented for periods prior to January 1, 2012 have not been
      restated to reflect this change.
^6    Digital penetration is calculated by dividing the number of digital
      cable RGUs by the total number of digital and analog cable RGUs.
      Our fully swapped debt borrowing cost represents the weighted average
^7    interest rate on our aggregate variable and fixed rate indebtedness,
      including the effects of derivative instruments, discounts and
      commitment fees, but excluding the impact of financing costs.
      UPCB Finance Limited, UPCB Finance II Limited, UPCB Finance III Limited,
      UPCB Finance V Limited and UPCB Finance VI Limited are special purpose
      financing companies created for the primary purpose of issuing senior
      secured notes and are owned 100% by charitable trusts. We used the
      proceeds from the senior secured notes to fund Facilities V, Y, Z, AC
      and AD under the UPC Broadband Holding Bank Facility, with UPC
      Financing, our direct subsidiary, as the borrower. These special purpose
^8    financing companies are dependent on payments from UPC Financing under
      Facilities V, Y, Z, AC and AD in order to service their payment
      obligations under the senior secured notes. As such, these companies are
      variable interest entities and UPC Financing and its parent entities,
      including UPC Holding, are required by accounting principles generally
      accepted in the U.S. (“GAAP”) to consolidate these companies.
      Accordingly, the amounts outstanding under Facilities V, Y, Z, AC and AD
      eliminate within our condensed consolidated financial statements.
      Except as described in note 8 above, amounts represent total third-party
^9    commitments at December 31, 2012 without giving effect to the impact of
      discounts.
^10   Facilities T and AF carrying values include the impact of discounts.
^11   The Facility AF interest rate includes a LIBOR floor of 1.00%.
      Our covenant calculations are based on debt amounts which take into
^12   account currency swaps calculated at weighted average FX rates across
      the period. Thus, the debt used in the calculations may differ from the
      debt balances reported within the financial statements.
      

Revenue and Operating Cash Flow

In the following tables, we present revenue and operating cash flow by
reportable segment for the three months and year ended December 31, 2012, as
compared to the corresponding prior year periods. All of the reportable
segments derive their revenue primarily from broadband communications
services, including video, broadband internet and telephony services. Most
reportable segments also provide B2B services. At December 31, 2012, our
operating segments in UPC Europe provided broadband communications services in
nine European countries and direct-to-home (“DTH”) services to customers in
the Czech Republic, Hungary, Romania and Slovakia through a Luxembourg-based
organization that we refer to as "UPC DTH." Our Other Western Europe segment
includes our broadband communications operating segments in Austria and
Ireland. Our Central and Eastern Europe segment includes our broadband
communications operating segments in the Czech Republic, Hungary, Poland,
Romania and Slovakia. UPC Europe’s central and other category includes (i) the
UPC DTH operating segment, (ii) costs associated with certain centralized
functions, including billing systems, network operations, technology,
marketing, facilities, finance and other administrative functions and (iii)
intersegment eliminations within UPC Europe. VTR provides video, broadband
internet and telephony services in Chile.

Beginning in the fourth quarter of 2012, the management responsibility for
certain of our operations in Switzerland was transferred to our Austrian
operations and, accordingly, such operations are now reported within our Other
Western Europe segment. Segment information for all periods presented has been
retrospectively revised to reflect this change. We present only the reportable
segments of our continuing operations in the tables below.

For purposes of calculating rebased growth rates on a comparable basis for all
businesses that we owned during 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 our rebased amounts for the three months and year ended December
31, 2011 to the same extent that the revenue and OCF of such entities are
included in our results for the three months and year ended December 31, 2012
and (ii) reflect the translation of our rebased amounts for the three months
and year ended December 31, 2011 at the applicable average foreign currency
exchange rates that were used to translate our results for the three months
and year ended December 31, 2012. The acquired entities that have been
included in whole or in part in the determination of our rebased revenue and
OCF for the three months ended December 31, 2011 include four small entities
in Europe. The acquired entities that have been included in whole or in part
in the determination of our rebased revenue and OCF for the year ended
December 31, 2011 include Aster and six small entities in Europe.

We have reflected the revenue and OCF of the acquired entities in our 2011
rebased amounts based on what we believe to be the most reliable information
that is currently available to us (generally pre-acquisition financial
statements), as adjusted for the estimated effects of (i) any significant
differences between GAAP and local generally accepted accounting principles,
(ii) any significant effects of acquisition accounting adjustments, (iii) any
significant differences between our accounting policies and those of the
acquired entities and (iv) other items we deem appropriate. We do not adjust
pre-acquisition periods to eliminate non-recurring items or to give
retroactive effect to any changes in estimates that might be implemented
during post-acquisition periods. As we did not own or operate the acquired
businesses during the pre-acquisition periods, no assurance can be given that
we have identified all adjustments necessary to present the revenue and OCF of
these entities on a basis that is comparable to the corresponding
post-acquisition amounts that are included in our historical results or that
the pre-acquisition financial statements we have relied upon do not contain
undetected errors. The adjustments reflected in our rebased amounts have not
been prepared with a view towards complying with Article 11 of Regulation S-X.
In addition, the rebased growth percentages are not necessarily indicative of
the revenue and OCF that would have occurred if these transactions had
occurred on the dates assumed for purposes of calculating our rebased amounts
or the revenue and OCF that will occur in the future. The rebased growth
percentages have been presented as a basis for assessing growth rates on a
comparable basis, and are not presented as a measure of our pro forma
financial performance. Therefore, we believe our rebased data is not a
non-GAAP financial measure as contemplated by Regulation G or Item 10 of
Regulation S-K.

The selected financial data contained herein is preliminary and unaudited  and
subject to possible adjustments in connection with the publication of UPC
Holding’s December 31, 2012 consolidated financial statements. In each case,
the following tables present (i) the amounts reported by each of our
reportable segments for the comparative periods, (ii) the euro change and
percentage change from period to period and (iii) the percentage change from
period to period on a rebased basis:

                            Three months ended      Increase        Increase
Revenue                                                         
                            December 31,            (Decrease)      (Decrease)
                            2012       2011        €       %      Rebased %
                            in millions, except % amounts
UPC Europe:
The Netherlands             € 242.2     € 232.8     € 9.4    4.0    3.9
Switzerland                   250.9       236.7       14.2   6.0    3.8
Other Western Europe         169.3      162.2      7.1    4.4    4.4    
Total Western Europe          662.4       631.7       30.7   4.9    4.0
Central and Eastern           220.4       211.6       8.8    4.2    (0.9   )
Europe
Central and other            24.1       21.2       2.9    13.7   —      
Total UPC Europe              906.9       864.5       42.4   4.9    3.0
VTR (Chile)                  184.7      159.9      24.8   15.5   3.8    
Total                       € 1,091.6   € 1,024.4   € 67.2   6.6    3.1    
                                                                    

                           Year ended              Increase         Increase
                                                                
                           December 31,            (Decrease)       (Decrease)
                           2012       2011        €        %      Rebased %
                           in millions, except % amounts
UPC Europe:
The Netherlands            € 955.6     € 914.9     € 40.7    4.4    4.4
Switzerland                  979.6       921.3       58.3    6.3    3.8
Other Western Europe        659.5      641.8      17.7    2.8    2.7    
Total Western Europe         2,594.7     2,478.0     116.7   4.7    3.7
Central and Eastern          867.5       806.6       60.9    7.6    (0.6   )
Europe
Central and other           91.2       89.3       1.9     2.1    —      
Total UPC Europe             3,553.4     3,373.9     179.5   5.3    2.6
VTR (Chile)                 718.2      639.4      78.8    12.3   4.3    
Total                      € 4,271.6   € 4,013.3   € 258.3   6.4    2.9    
                                                                           

                       Three months ended      Increase             Increase
Operating Cash Flow                                             
                       December 31,            (Decrease)           (Decrease)
                       2012       2011        €         %         Rebased %
                       in millions, except % amounts
UPC Europe:
The Netherlands        € 147.7     € 137.4     € 10.3     7.5       7.5
Switzerland              142.9       132.7       10.2     7.7       5.5
Other Western Europe    84.4      74.6      9.8     13.1     13.1
Total Western Europe     375.0       344.7       30.3     8.8       7.9
Central and Eastern      111.6       99.9        11.7     11.7      6.2
Europe
Central and other       (34.1 )    (25.0 )    (9.1 )   (36.4 )   —
Total UPC Europe         452.5       419.6       32.9     7.8       5.8
VTR (Chile)             84.4      70.8      13.6    19.2     7.0
Total                  € 536.9    € 490.4    € 46.5    9.5      6.0
                                                                    

                  Year ended                  Increase              Increase
                                                                
                  December 31,                (Decrease)            (Decrease)
                  2012         2011          €          %         Rebased %
                  in millions, except % amounts
UPC Europe:
The Netherlands   € 573.1       € 542.5       € 30.6      5.6       5.6
Switzerland         558.4         518.5         39.9      7.7       5.2
Other Western      316.9       300.6       16.3     5.4      5.4
Europe
Total Western       1,448.4       1,361.6       86.8      6.4       5.4
Europe
Central and         431.7         393.5         38.2      9.7       0.0
Eastern Europe
Central and        (122.2  )    (95.3   )    (26.9 )   (28.2 )   —
other
Total UPC           1,757.9       1,659.8       98.1      5.9       2.8
Europe
VTR (Chile)        316.0       271.0       45.0     16.6     8.2
Total             € 2,073.9    € 1,930.8    € 143.1    7.4      3.6
                                                                    

Operating Cash Flow Definition and Reconciliation

Operating cash flow is the primary measure used by our chief operating
decision maker to evaluate segment operating performance. Operating cash flow
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, operating cash flow is defined as
revenue less operating and selling, general and administrative expenses
(excluding stock-based compensation, related party fees and allocations,
depreciation and amortization, 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 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.A reconciliation of total segment
operating cash flow to our operating income is presented below.

                          Three months ended        Year ended
                                                 
                          December 31,              December 31,
                          2012        2011         2012          2011
                          in millions
Total segment operating   € 536.9      € 490.4      € 2,073.9      € 1,930.8
cash flow
Stock-based                 (3.7   )     (3.6   )     (17.8    )     (13.5   )
compensation expense
Depreciation and            (246.5 )     (247.3 )     (1,037.3 )     (970.2  )
amortization
Related party fees and      (13.8  )     (6.8   )     2.4            (5.9    )
allocations, net
Impairment,
restructuring and other    (5.9   )    (12.5  )    (8.2     )    (26.8   )
operating items, net
Operating income          € 267.0     € 220.2     € 1,013.0     € 914.4   
                                                                   

Capital Expenditures

The following table provides property and equipment additions for UPC Holding
for the indicated periods:

                                 Three months ended      Year ended
                                                      
                                 December 31,            December 31,
                                 2012       2011        2012       2011
                                 in millions, except % amounts
UPC Europe:
The Netherlands                  € 51.7      € 45.8      € 172.3     € 166.6
Switzerland                        44.1        55.7        173.2       169.5
Other Western Europe              29.7      43.5      112.7     139.4 
Total Western Europe               125.5       145.0       458.2       475.5
Central and Eastern Europe         54.0        42.0        176.7       144.9
Central and other                 35.2      37.8      120.2     120.7 
Total UPC Europe                   214.7       224.8       755.1       741.1
VTR (Chile)                       33.9      32.4      160.6     132.1 
Total UPC Holding                € 248.6    € 257.2    € 915.7    € 873.2 
                                                                     
Total property and equipment      22.8  %    25.1  %    21.4  %    21.8  %
additions as % of revenue
                                                                     

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
Customer premises equipment     € 91.9      € 71.6      € 400.5      € 326.5
Scalable infrastructure           49.7        64.2        165.0        196.1
Line extensions                   28.9        29.4        102.2        98.0
Upgrade/rebuild                   25.5        31.7        82.0         93.7
Support capital                  52.6      60.3      166.0      158.9 
Property and equipment            248.6       257.2       915.7        873.2
additions
Assets acquired under
capital-related vendor
financing                         (48.8 )     (31.8 )     (160.6 )     (73.2 )
arrangements (including
related-party amounts)^1
Assets acquired under capital     (0.5  )     (0.3  )     (1.9   )     (1.4  )
leases^1
Assets contributed by parent      (3.7  )     —           (10.2  )     —
company^2
Changes in current
liabilities related to
capital expenditures             (29.5 )    (39.1 )    (19.2  )    (17.0 )
(including related-party
amounts)
Total capital expenditures      € 166.1    € 186.0    € 723.8     € 781.6 
                                                                     
Total Capital Expenditures:
UPC Europe                      € 137.0     € 170.4     € 571.6      € 663.6
VTR (Chile)                      29.1      15.6      152.2      118.0 
Total UPC Holding               € 166.1    € 186.0    € 723.8     € 781.6 
                                                                     
Total Capital Expenditures as
% of Revenue:
UPC Europe                        15.1  %     19.7  %     16.1   %     19.7  %
VTR (Chile)                      15.8  %    9.8   %    21.2   %    18.5  %
Total UPC Holding                15.2  %    18.2  %    16.9   %    19.5  %
                                                                             

RGUs, Customers and Bundling^3

The following table provides information on the breakdown of our RGUs and
customer base and highlights our customer bundling metrics at December 31,
2012, September 30, 2012 and December 31, 2011:

                               September      December 31,   Q4’12 /   Q4’12 /
               December 31,  30,                         Q3’12    Q4’11
                2012           2012           2011           (%        (%
                                                             Change)   Change)
Total RGUs
Video           9,290,400      9,294,500      9,375,500      —         (0.9 %)
Broadband       5,458,400      5,343,800      4,968,000      2.1  %    9.9  %
Internet
Telephony       3,986,700     3,865,000     3,464,100     3.1  %    15.1 %
UPC Holding     18,735,500     18,503,300     17,807,600     1.3  %    5.2  %
RGUs
                                                                       
Total
Customers
Total
Single-Play     5,188,700      5,269,700      5,517,000      (1.5 %)   (6.0 %)
Customers
Total
Double-Play     1,923,900      1,953,300      2,015,700      (1.5 %)   (4.6 %)
Customers
Total
Triple-Play     3,233,000     3,109,000     2,753,100     4.0  %    17.4 %
Customers
UPC Holding     10,345,600     10,332,000     10,285,800     0.1  %    0.6  %
Customers
                                                                       
% Double-Play
Customers
UPC Europe      18.3       %   18.7       %   19.4       %   (2.1 %)   (5.7 %)
VTR (Chile)     20.7       %   20.5       %   21.2       %   1.0  %    (2.4 %)
UPC Holding     18.6       %   18.9       %   19.6       %   (1.6 %)   (5.1 %)
                                                                       
% Triple-Play
Customers
UPC Europe      29.4       %   28.0       %   24.6       %   5.0  %    19.5 %
VTR (Chile)     46.1       %   46.7       %   45.2       %   (1.3 %)   2.0  %
UPC Holding     31.3       %   30.1       %   26.8       %   4.0  %    16.8 %
                                                                       
RGUs per
Customer
Relationship
UPC Europe      1.77           1.75           1.69           1.1  %    4.7  %
VTR (Chile)     2.13           2.14           2.12           (0.5 %)   0.5  %
UPC Holding     1.81           1.79           1.73           1.1  %    4.6  %
                                                                       

ARPU per Customer Relationship^4

The following table provides ARPU per customer relationship for the indicated
periods:

             Three months ended Dec. 31,            FX Neutral
              2012            2011         % Change   % Change^5
UPC Europe    €     28.91      €   27.43    5.4   %    3.8    %
VTR (Chile)   CLP   30,830     CLP 30,572   0.8   %    0.8    %
UPC Holding   €     31.20      €   29.23    6.7   %    3.5    %
                                                              

     The capital expenditures that we report in our consolidated cash flow
     statements do not include amounts that are financed under vendor
^1  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
     principal is repaid.
     Represents non-cash contributions of property and equipment that we
^2   received from our parent company. These amounts are excluded from the
     capital expenditures that we report in our consolidated cash flow
     statements.
     The RGU, customer and bundling statistics reported for periods prior to
^3   January 1, 2012 have not been restated to reflect the January 1, 2012
     change in our reporting of SOHO RGUs.
     ARPU per customer relationship refers to the average monthly subscription
     revenue per average customer relationship and is calculated by dividing
     the average monthly subscription revenue (excluding installation, late
     fees and mobile service revenue) for the indicated period, by the average
     of the opening and closing balances for customer relationships for the
^4   period. Customer relationships of entities acquired during the period are
     normalized. Unless otherwise indicated, ARPU per customer relationship
     for UPC Europe and UPC Holding are not adjusted for currency impacts.
     ARPU per customer relationship amounts reported for periods prior to
     January 1, 2012 have not been restated to reflect the January 1, 2012
     change in our reporting of SOHO RGUs.
     The FX-neutral change represents the percentage change on a
^5   year-over-year basis adjusted for FX impacts and is calculated by
     adjusting the prior year figures to reflect translation at the foreign
     currency rates used to translate the current year amounts.
     

                  Consolidated Operating Data – December 31, 2012
                                                                          Video                                                                              Internet                            Telephony
                   Homes        Two-way      Customer            Total        Analog Cable      Digital Cable     DTH               MMDS              Total       Homes                                Homes
                                Homes                                                                                                                                          Subscribers^(10)                     Subscribers^(12)
                   Passed^(1)                Relationships^(3)   RGUs^(4)     Subscribers^(5)   Subscribers^(6)   Subscribers^(7)   Subscribers^(8)   Video       Serviceable^(9)                      Serviceable^(11)
                                Passed^(2)
UPC Europe:
The                2,825,200    2,810,800    1,731,800           3,685,500    651,600           1,078,000         —                 —                 1,729,600   2,823,500         1,025,400          2,820,700          930,500
Netherlands^(13)
Switzerland^(13)   2,074,700    1,825,400    1,485,600           2,464,400    842,500           606,000           —                 —                 1,448,500   2,292,000         594,500            2,323,900          421,400
Austria            1,313,400    1,297,400    733,000             1,408,000    199,400           335,900           —                 —                 535,300     1,297,300         490,700            1,265,400          382,000
Ireland            862,900      737,200      538,800             988,800      63,000            337,800           —                 45,600            446,400     737,200           304,300            715,000            238,100
Total Western      7,076,200    6,670,800    4,489,200           8,546,700    1,756,500         2,357,700         —                 45,600            4,159,800   7,150,000         2,414,900          7,125,000          1,972,000
Europe
Poland             2,667,900    2,537,600    1,472,000           2,616,000    546,000           756,300           —                 —                 1,302,300   2,537,600         854,700            2,527,600          459,000
Hungary            1,525,700    1,508,300    1,029,600           1,760,300    306,900           327,100           242,900           —                 876,900     1,508,300         486,600            1,510,700          396,800
Romania            2,082,800    1,708,000    1,177,600           1,733,900    428,700           423,600           319,700           —                 1,172,000   1,708,000         333,000            1,646,200          228,900
Czech Republic     1,345,200    1,236,900    745,300             1,217,300    76,100            406,000           102,200           —                 584,300     1,236,900         439,900            1,234,200          193,100
Slovakia           495,500      464,800      287,500             425,600      84,100            123,100           54,300            1,100             262,600     433,600           103,800            431,800            59,200
Total CEE          8,117,100    7,455,600    4,712,000           7,753,100    1,441,800         2,036,100         719,100           1,100             4,198,100   7,424,400         2,218,000          7,350,500          1,337,000
Total UPC Europe   15,193,300   14,126,400   9,201,200           16,299,800   3,198,300         4,393,800         719,100           46,700            8,357,900   14,574,400        4,632,900          14,475,500         3,309,000
                                                                                                                                                                                                                          
VTR (Chile)        2,861,100    2,330,400    1,144,400           2,435,700    163,200           769,300           —                 —                 932,500     2,330,400         825,500            2,322,100          677,700
                                                                                                                                                                                                                          
Grand Total        18,054,400   16,456,800   10,345,600          18,735,500   3,361,500         5,163,100         719,100           46,700            9,290,400   16,904,800        5,458,400          16,797,600         3,986,700
                                                                                                                                                                                                                          

                  Subscriber Variance Table – December 31, 2012 vs. September 30, 2012
                                                                         Video                                                                              Internet                            Telephony
                   Homes        Two-way      Customer            Total       Analog Cable      Digital Cable     DTH               MMDS              Total       Homes                                Homes
                                Homes                                                                                                                                         Subscribers^(10)                     Subscribers^(12)
                   Passed^(1)                Relationships^(3)   RGUs^(4)    Subscribers^(5)   Subscribers^(6)   Subscribers^(7)   Subscribers^(8)   Video       Serviceable^(9)                      Serviceable^(11)
                                Passed^(2)
UPC Europe:
The                5,800        6,600        (30,200     )       2,000       (42,600     )     12,200            —                 —                 (30,400 )   6,500             12,100             6,700              20,300
Netherlands^(13)
Switzerland^(13)   (46,200  )   (15,200  )   (58,500     )       (30,300 )   (79,500     )     21,200            —                 —                 (58,300 )   (16,100    )      8,800              15,800             19,200
Austria            51,100       35,100       31,900              50,100      22,000            8,500             —                 —                 30,500      35,000            11,600             3,100              8,000
Ireland            (900     )   3,800       600                19,600     (4,500      )     1,700            —                 (2,300     )      (5,100  )   3,800            10,000            7,300              14,700      
Total Western      9,800       30,300      (56,200     )       41,400     (104,600    )     43,600           —                 (2,300     )      (63,300 )   29,200           42,500            32,900             62,200      
Europe
Poland             18,200       24,100       8,200               56,200      (46,700     )     40,900            —                 —                 (5,800  )   24,100            34,600             24,600             27,400
Hungary            7,200        5,800        10,300              37,500      (13,600     )     13,300            10,900            —                 10,600      5,800             9,100              5,800              17,800
Romania            4,100        7,400        25,300              58,300      (17,700     )     19,400            23,600            —                 25,300      7,400             16,300             7,500              16,700
Czech Republic     3,200        3,200        1,000               2,800       3,800             (4,700     )      6,000             —                 5,100       3,200             300                3,300              (2,600      )
Slovakia           9,000       5,400       10,100             16,900     700              4,800            2,900             400              8,800      6,000            5,400             4,100              2,700       
Total CEE          41,700      45,900      54,900             171,700    (73,500     )     73,700           43,400            400              44,000     46,500           65,700            45,300             62,000      
Total UPC Europe   51,500       76,200       (1,300      )       213,100     (178,100    )     117,300           43,400            (1,900     )      (19,300 )   75,700            108,200            78,200             124,200
                                                                                                                                                                                                                         
VTR (Chile)        41,500      52,000      14,900             19,100     (9,400      )     24,600           —                 —                15,200     52,000           6,400             52,400             (2,500      )
                                                                                                                                                                                                                         
Grand Total        93,000      128,200     13,600             232,200    (187,500    )     141,900          43,400            (1,900     )      (4,100  )   127,700          114,600           130,600            121,700     
                                                                                                                                                                                                                         
ORGANIC CHANGE
SUMMARY:
UPC Europe         40,500       72,000       (9,900      )       203,000     (184,900    )     116,500           43,400            (2,300     )      (27,300 )   71,700            106,100            75,900             124,200
VTR (Chile)        41,500      52,000      14,900             19,100     (9,400      )     24,600           —                 —                15,200     52,000           6,400             52,400             (2,500      )
Total Organic      82,000      124,000     5,000              222,100    (194,300    )     141,100          43,400            (2,300     )      (12,100 )   123,700          112,500           128,300            121,700     
Change
                                                                                                                                                                                                                         
Q4 2012
ADJUSTMENTS:
Acquisition - HU   1,300        1,000        600                 1,000       200               400               —                 —                 600         800               400                800                —
Acquisition - SK   7,000        1,700        8,000               9,100       6,600             400               —                 400               7,400       1,700             1,700              —                  —
PL adjustment      2,700        1,500        —                   —           —                 —                 —                 —                 —           1,500             —                  1,500              —
CH                 (47,900  )   (31,900  )   (30,700     )       (35,600 )   (30,700     )     —                 —                 —                 (30,700 )   (31,900    )      (4,900      )      —                  —
adjustment^(14)
AT                 47,900      31,900      30,700             35,600     30,700           —                —                 —                30,700     31,900           4,900             —                  —           
adjustment^(14)
Net Adjustments    11,000      4,200       8,600              10,100     6,800            800              —                 400              8,000      4,000            2,100             2,300              —           
                                                                                                                                                                                                                         
Total Adds         93,000      128,200     13,600             232,200    (187,500    )     141,900          43,400            (1,900     )      (4,100  )   127,700          114,600           130,600            121,700     
(Reductions)
                                                                                                                                                                                                                                     

Footnotes for Operating Data and Subscriber Variance Tables
      
        Homes Passed are homes, residential multiple dwelling units or
        commercial units that can be connected to our networks without
        materially extending the distribution plant, except for direct-to-home
        (“DTH”) and Multi-channel Multipoint (“microwave”) Distribution System
        (“MMDS”) homes. Our Homes Passed counts are based on census data that
        can change based on either revisions to the data or from new census
^(1)    results. We do not count homes passed for DTH. With respect to MMDS,
        one MMDS customer is equal to one Home Passed. Due to the fact that we
        do not own the partner networks (defined below) used in Switzerland
        and the Netherlands (see note 13) or the unbundled loop and shared
        access network used by one of our Austrian subsidiaries, UPC Austria
        GmbH (“Austria GmbH”), we do not report homes passed for Switzerland’s
        and the Netherlands’ partner networks or the unbundled loop and shared
        access network used by Austria GmbH.
        Two-way Homes Passed are Homes Passed by those sections of our
        networks that are technologically capable of providing two-way
        services, including video, internet and telephony services. Due to the
^(2)    fact that we do not own the partner networks used in Switzerland and
        the Netherlands or the unbundled loop and shared access network used
        by Austria GmbH, we do not report two-way homes passed for
        Switzerland’s or the Netherlands’ partner networks or the unbundled
        loop and shared access network used by Austria GmbH.
        Customer Relationships are the number of customers who receive at
        least one of our video, internet or telephony services that we count
        as Revenue Generating Units (“RGUs”), without regard to which or to
        how many services they subscribe. To the extent that RGU counts
        include equivalent billing unit (“EBU”) adjustments, we reflect
        corresponding adjustments to our Customer Relationship counts. For
^(3)    further information regarding our EBU calculation, see Additional
        General Notes to Tables below. Customer Relationships generally are
        counted on a unique premises basis. Accordingly, if an individual
        receives our services in two premises (e.g., a primary home and a
        vacation home), that individual generally will count as two Customer
        Relationships. We exclude mobile customers from Customer
        Relationships.
        Revenue Generating Unit is separately an Analog Cable Subscriber,
        Digital Cable Subscriber, DTH Subscriber, MMDS Subscriber, Internet
        Subscriber or Telephony Subscriber. A home, residential multiple
        dwelling unit, or commercial unit may contain one or more RGUs. For
        example, if a residential customer in our Austrian system subscribed
        to our digital cable service, telephony service and broadband internet
        service, the customer would constitute three RGUs. Total RGUs is the
        sum of Analog Cable, Digital Cable, DTH, MMDS, Internet and Telephony
        Subscribers. RGUs generally are counted on a unique premises basis
        such that a given premises does not count as more than one RGU for any
        given service. On the other hand, if an individual receives one of our
        services in two premises (e.g. a primary home and a vacation home),
^(4)    that individual will count as two RGUs for that service. Each bundled
        cable, internet or telephony service is counted as a separate RGU
        regardless of the nature of any bundling discount or promotion.
        Non-paying subscribers are counted as subscribers during their free
        promotional service period. Some of these subscribers may choose to
        disconnect after their free service period. Services offered without
        charge on a long-term basis (e.g., VIP subscribers, free service to
        employees) generally are not counted as RGUs. We do not include
        subscriptions to mobile services in our externally reported RGU
        counts. In this regard, our December 31, 2012 RGU counts exclude
        34,500, 3,500 and 2,800 postpaid subscriber identification module
        (“SIM”) cards in service in Poland, the Netherlands and Hungary,
        respectively.
        Analog Cable Subscriber is a home, residential multiple dwelling unit
        or commercial unit that receives our analog cable service over our
        broadband network. The Analog Cable Subscriber count reported for
        Switzerland also include subscribers who may use a purchased set-top
        box or other non-verifiable means to receive our basic digital cable
^(5)    channels without subscribing to any services that would require the
        payment of recurring monthly fees in addition to the basic analog
        service fee (“Basic Digital Cable Subscriber”). In Europe, we have
        approximately 400,500 “lifeline” customers that are counted on a per
        connection basis, representing the least expensive regulated tier of
        video cable service, with only a few channels.
        Digital Cable Subscriber is a home, residential multiple dwelling unit
        or commercial unit that receives our digital cable service over our
        broadband network or through a partner network. We count a subscriber
        with one or more digital converter boxes that receives our digital
        cable service in one premises as just one subscriber. A Digital Cable
        Subscriber is not counted as an Analog Cable Subscriber. As we migrate
^(6)    customers from analog to digital cable services, we report a decrease
        in our Analog Cable Subscribers equal to the increase in our Digital
        Cable Subscribers. As discussed in further detail in note 5 above,
        Basic Digital Cable Subscribers are not included in the respective
        Digital Cable Subscriber count reported for Switzerland. Subscribers
        to digital cable services provided by our operations in Switzerland
        and the Netherlands over partner networks receive analog cable
        services from the partner networks as opposed to our operations.
        DTH Subscriber is a home, residential multiple dwelling unit or
^(7)    commercial unit that receives our video programming broadcast directly
        via a geosynchronous satellite.
^(8)    MMDS Subscriber is a home, residential multiple dwelling unit or
        commercial unit that receives our video programming via MMDS.
        Internet Homes Serviceable are Two-way Homes Passed that can be
        connected to our network, or a partner network with which we have a
        service agreement, for the provision of broadband internet services if
^(9)    requested by the customer, building owner or housing association, as
        applicable. With respect to Austria GmbH, we do not report as Internet
        Homes Serviceable those homes served either over an unbundled loop or
        over a shared access network.
        Internet Subscriber is a home, residential multiple dwelling unit or
        commercial unit that receives internet services over our networks, or
        that we service through a partner network. Our Internet Subscribers in
^(10)   Austria include 73,000 digital subscriber line (“DSL”) subscribers of
        Austria GmbH that are not serviced over our networks. Our Internet
        Subscribers do not include customers that receive services from
        dial-up connections.
        Telephony Homes Serviceable are Two-way Homes Passed that can be
        connected to our network, or a partner network with which we have a
        service agreement, for the provision of telephony services if
^(11)   requested by the customer, building owner or housing association, as
        applicable. With respect to Austria GmbH, we do not report as
        Telephony Homes Serviceable those homes served over an unbundled loop
        rather than our network.
        Telephony Subscriber is a home, residential multiple dwelling unit or
        commercial unit that receives voice services over our networks, or
^(12)   that we service through a partner network. Telephony Subscribers
        exclude mobile telephony subscribers. Our Telephony Subscribers in
        Austria include 59,000 subscribers of Austria GmbH that are not
        serviced over our networks.
        Pursuant to service agreements, Switzerland and, to a much lesser
        extent, the Netherlands offer digital cable, broadband internet and
        telephony services over networks owned by third-party cable operators
        (“partner networks”). A partner network RGU is only recognized if
        there is a direct billing relationship with the customer. Homes
        Serviceable for partner networks represent the estimated number of
        homes that are technologically capable of receiving the applicable
        service within the geographic regions covered by the applicable
        service agreements. Internet and Telephony Homes Serviceable with
^(13)   respect to partner networks have been estimated by our Switzerland
        operations. These estimates may change in future periods as more
        accurate information becomes available. At December 31, 2012,
        Switzerland’s partner networks account for 125,500 Customer
        Relationships, 236,500 RGUs, 91,900 Digital Cable Subscribers, 466,600
        Internet and Telephony Homes Serviceable, 83,500 Internet Subscribers,
        and 61,100 Telephony Subscribers. In addition, partner networks
        account for 454,100 of Switzerland’s digital cable homes serviceable
        that are not included in Homes Passed or Two-way Homes Passed in our
        December 31, 2012 subscriber table.
        During the fourth quarter of 2012, the management responsibility for
^(14)   certain of our operations in Switzerland was transferred to our
        Austrian operations resulting in a non-organic adjustment to record
        the transfer between these two operating segments.
        

Additional General Notes to Tables:

All of our subsidiaries provide telephony, broadband internet, data, video or
other business-to-business (“B2B”) services. Certain of our B2B revenue is
derived from small or home office (“SOHO”) subscribers that pay a premium
price to receive enhanced service levels along with video, internet or
telephony services that are the same or similar to the mass marketed products
offered to our residential subscribers. Effective January 1, 2012, we recorded
non-organic adjustments to begin including the SOHO subscribers of UPC Europe
in our RGU and customer counts. As a result, all mass marketed products
provided to SOHOs, whether or not accompanied by enhanced service levels
and/or premium prices, are now included in the respective RGU and customer
counts of our broadband communications operations, with only those services
provided at premium prices considered to be “SOHO RGUs” or “SOHO customers.”
With the exception of our B2B SOHO subscribers, we generally do not count
customers of B2B services as customers or RGUs for external reporting
purposes.

Certain of our residential and commercial RGUs are counted on an EBU basis,
including residential multiple dwelling units and commercial establishments,
such as bars, hotels and hospitals, in Chile and certain commercial
establishments in Europe. Our EBUs are generally calculated by dividing the
bulk price charged to accounts in an area by the most prevalent price charged
to non-bulk residential customers in that market for the comparable tier of
service. As such, we may experience variances in our EBU counts solely as a
result of changes in rates.

While we take appropriate steps to ensure that subscriber statistics are
presented on a consistent and accurate basis at any given balance sheet date,
the variability from country to country in (i) the nature and pricing of
products and services, (ii) the distribution platform, (iii) billing systems,
(iv) bad debt collection experience and (v) other factors add complexity to
the subscriber counting process. We periodically review our subscriber
counting policies and underlying systems to improve the accuracy and
consistency of the data reported on a prospective basis. Accordingly, we may
from time to time make appropriate adjustments to our subscriber statistics
based on those reviews.

Subscriber information for acquired entities is preliminary and subject to
adjustment until we have completed our review of such information and
determined that it is presented in accordance with our policies.

Contact:

UPC Holding
Investor Relations:
Christopher Noyes, +1 303-220-6693
or
Oskar Nooij, +1 303-220-4218
or
Corporate Communications:
Hanne Wolf, +1 303-220-6678
or
Bert Holtkamp, +31 20-778-9800
 
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