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Item 7. Management’s Discussion and Analysis

2023-02-22 compared with 2022-02-23 · 308 added, 851 removed, 499 unchanged (70% of the section changed)

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Unless otherwise indicated, operational data (including subscriber statistics) is presented as of December 31, 2022.

A discussion regarding our financial condition and results of operations for the year ended December 31, 2021 compared with the year ended December 31, 2020 can be found under captions entitled “ Results of Operations ” and “ Liquidity and Capital Resources ” in the section entitled “ Item 7 - Management’s Discussion and Analysis of Financial Condition and Results of Operations ” of our annual report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 1, 2022, which is available free of charge through the SEC’s website at www.sec.gov or the Company’s website, https://investors.lla.com/financials/sec-filings.

The Company’s website and the information contained therein, or incorporated therein, are not intended to be incorporated into this Annual Report on Form 10-K.

We are an international provider of fixed, mobile and subsea telecommunications services.

residential and B2B services in:

over 20 countries across Latin America and the Caribbean through two of our reportable segments, C&W Caribbean and Networks and C&W Panama;

over 20 countries across Latin America and the Caribbean through two of our reportable segments, C&W Caribbean and C&W Panama;

Puerto Rico, through our reportable segment Liberty Puerto Rico;

Chile, through our reportable segment VTR;

Costa Rica, through Cabletica and its subsidiary, Telefónica Costa Rica;

through our Networks & LatAm business of our C&W Caribbean and Networks segment, (i) B2B services in certain other countries in Latin America and the Caribbean and (ii) wholesale communication services over its subsea and terrestrial fiber optic cable networks that connect approximately 40 markets in that region.

Prior to the first quarter of 2021, VTR and Cabletica were collectively one operating segment.

As a result of organizational changes during the first quarter of 2021, these operations became separate operating segments.

Following the Telefónica Costa Rica Acquisition on August 9, 2021 (as further described in note 4), Cabletica and Telefónica Costa Rica now comprise our operating and reportable segment referred to herein as “Costa Rica.” Accordingly, as of December 31, 2021, our reportable segments are as follows:

• C&W Caribbean and Networks;

• C&W Panama;

• Liberty Puerto Rico;

• Costa Rica.

As a result of the aforementioned segment change, we have revised the presentation of the discussion and analysis set forth below in order to align with the current segment presentation included in our consolidated financial statements.

Effective September 29, 2021, in connection with the pending formation of the Chile JV (as further described in note 9), we began accounting for the Chile JV Entities as “held for sale.” Accordingly, the assets and liabilities of the Chile JV Entities, excluding certain cash balances, are included in assets held for sale and liabilities associated with assets held for sale, respectively, on our December 31, 2021 consolidated balance sheet.

Consistent with the applicable guidance, we have not reflected similar reclassifications to exclude Chile JV Entities from continuing operations in our consolidated statements of

operations or cash flows.

As a result, the discussion and analysis of our results of operations and cash flows set forth below continue to include the amounts associated with the Chile JV Entities.

Costa Rica, through our reportable segment Liberty Costa Rica;

Chile, through our reportable segment VTR through September 30, 2022;

through our reportable segment C&W Networks & LatAm, (i) B2B services in certain other countries in Latin America and the Caribbean and (ii) wholesale communication services over its subsea and terrestrial fiber optic cable networks that connect approximately 40 markets in that region.

At December 31, 2022, we (i) owned and operated fixed networks that passed 4,327,000 homes and served 3,819,500 RGUs comprising 1,734,100 broadband internet subscribers, 958,700 video subscribers and 1,126,700 fixed-line telephony subscribers, and (ii) served 8,169,500 mobile subscribers.

In December 2019, COVID-19 was reported in Wuhan, China.

On March 11, 2020, the World Health Organization declared the outbreak a “pandemic,” pointing to the sustained risk of further global spread.

During 2020, COVID-19 negatively impacted our operations relative to the 2019 period prior to the pandemic, particularly with respect to revenue associated with B2B and mobile operations within our C&W Caribbean and Networks, C&W Panama and VTR segments.

Given COVID-19 continues to evolve, the extent to which COVID-19 may further impact our financial condition or results of operations continues to be uncertain and cannot be predicted at this tim e.

The heightened volatility of global markets resulting from COVID-19 further expose us to risks and uncertainties.

On September 29, 2021, we entered into an agreement with América Móvil to contribute the Chile JV Entities to América Móvil’s Chilean operations, to form the Chile JV that will be owned 50:50 by Liberty Latin America and América Móvil.

América Móvil is a telecommunications service provider with over 6.5 million mobile customers .

The consummation of the transaction is subject to certain customary closing conditions, including regulatory approvals, and is expected to close in the second half of 2022.

During 2022, we completed an organizational change with respect to our C&W operations whereby management of certain subsidiaries of C&W, which primarily operate our subsea and fiber optic cable networks, now report directly to the chief operating decision maker of Liberty Latin America and no longer report to the former C&W Caribbean and Networks segment decision maker.

As a result, the aforementioned subsidiaries of C&W are now a separate operating and reportable segment, herein referred to as the C&W Networks & LatAm segment.

In connection with this change, we have restated our segment presentation for all periods to separately present (i) C&W Caribbean and (ii) C&W Networks & LatAm.

Claro Panama Acquisition.

On September 14, 2021, we entered into a definitive agreement to acquire América Móvil’s operations in Panama in an all-cash transaction based upon an enterprise value of $200 million on a cash- and debt-free basis.

The transaction is subject to certain customary closing conditions, including regulatory approvals, and is expected to close in the first half of 2022.

Telefónica Costa Rica Acquisition

On July 30, 2020, we entered into a definitive agreement to acquire Telefónica S.A.’s operations in Costa Rica in an all-cash transaction based upon an enterprise value of $500 million on a cash- and debt-free basis.

On August 9, 2021, we completed the Telefónica Costa Rica Acquisition.

The total purchase price of the Telefónica Costa Rica Acquisition was $538 million, which includes the impact of certain preliminary working capital adjustments totaling $38 million.

The Telefónica Costa Rica Acquisition was financed through a combination of debt, existing cash and a $47 million equity contribution from the noncontrolling interest owner of our Cabletica entity, as further described in note 19 to the consolidated financial statements.

On July 1, 2022, we completed the acquisition of Claro Panama, which was financed through a combination of debt and existing cash.

On September 29, 2021, we entered into an agreement with América Móvil to contribute the Chile JV Entities to América Móvil’s Chilean operations to form the Chile JV that will be owned 50:50 by Liberty Latin America and América Móvil.

In October 2022, we completed the formation of the Chile JV and made a balancing payment to América Móvil totaling $76 million.

The transaction did not trigger a change of control under VTR’s debt agreements, and was not subject to Liberty Latin America or América Móvil shareholder approvals.

Beginning in October, we have accounted for our 50% interest in the Chile JV as an equity method investment.

Strategy and Management Focus

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While we seek to increase our customer base, we also seek to maximize the average revenue we receive from each household or business by increasing the penetration of our video, broadband internet, fixed-line telephony and mobile services with existing customers through product bundling and up-selling.

We are engaged in the Network Extensions program across Liberty Latin America.

The Network Extensions will occur in phases with priority given to the most accretive expansion opportunities.

During 2021, our network extension and upgrade programs passed approximately 738,800 homes across Liberty Latin America.

Depending on a variety of factors, including the financial and operational results of the programs, the Network Extensions may be continued, modified or cancelled at our discretion.

Business—Products and Services—Residential Services—Internet Services .

For information regarding our expectation with regard to property and equipment additions as a percent of revenue during 2023, see Liquidity and Capital Resources—Consolidated Statements of Cash Flows below.

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We are experiencing significant competition from other telecommunications operators and other communication service providers in all of our markets.

The significant competition we are experiencing, together with macroeconomic factors, has adversely impacted our revenue, RGUs and/or ARPU in a number of C&W’s markets.

In Chile, we continue to experience significant competition with respect to VTR’s fixed-line business, as competitors continue to upgrade their networks.

The significant competition we are experiencing, together with macroeconomic factors, has adversely impacted our revenue, RGUs and/or ARPU in a number of our markets.

For additional information regarding the revenue impact of changes in the RGUs and ARPU of our reportable segments, see discussion below .

Results of Operations

The comparability of our operating results during 2021, 2020 and 2019 is affected by acquisitions, disposals and FX effects.

The comparability of our operating results during 2022 and 2021 is affected by acquisitions, a disposal and FX effects.

As we use the term, “organic” changes exclude FX and the impacts of acquisitions and disposals, each as further discussed below.

In the following discussion, we quantify the estimated impact on the operating results of the periods under comparison that is attributable to acquisitions and disposals.

We (i) acquired (a) Telefónica’s operations in Costa Rica in August 2021, (b) AT&T’s wireless and wireline operations in Puerto Rico and the U.S.

Virgin Islands in October 2020, (c) a small B2B operation in the Cayman Islands in July 2020, and (d) UTS in March 2019;

and (ii) disposed of (a) certain B2B operations in Puerto Rico in January 2021 in connection with the AT&T Acquisition, as further described in note 4 to our consolidated financial statements, and (b) our operations in the Seychelles in November 2019.

In the following discussion, we quantify the estimated impacts on the operating results of the periods under comparison that are attributable to acquisitions and disposals.

We (i) acquired (a) América Móvil’s operations in Panama in July 2022, (b) 96% of Broadband VI, LLC’s operations in the USVI effective December 2021, (c) Telefónica’s operations in Costa Rica in August 2021, and (ii) disposed of the Chile JV Entities in October 2022 in connection with the formation of the Chile JV.

With respect to acquisitions, organic changes and the calculations of our organic change percentages exclude the operating results of an acquired entity during the first 12 months following the date of acquisition.

With respect to disposals, the prior-year operating results of disposed entities are excluded from organic changes and the calculations of our organic change percentages to the same extent that those operations are not included in the current year.

Changes in foreign currency exchange rates may have a significant impact on our operating results, as VTR, Costa Rica and certain entities within C&W have functional currencies other than the U.S.

Our primary exposure to FX risk is to the Chilean peso, as a significant portion of our revenue is derived from VTR.

Changes in foreign currency exchange rates may have a significant impact on our operating results, as VTR, Liberty Costa Rica and certain entities within C&W have functional currencies other than the U.S.

Our primary exposure to FX risk, prior to the formation of the Chile JV, was to the Chilean peso, as a significant portion of our revenue was derived from VTR.

For example, the average FX rate (utilized to translate our consolidated statements of operations) for the U.S.

dollar per one Chilean peso depreciated by 4% for the year ended December 31, 2021, as compared to 2020, and appreciated by 12% for the year ended December 31, 2020, as compared to 2019.

dollar per one Chilean peso depreciated by 17% for the nine months ended September 30, 2022, the period prior to the formation of the Chile JV in October 2022, as compared with the corresponding period in 2021.

The impacts to the various components of our results of operations that are attributable to changes in FX are highlighted below.

For information concerning our foreign currency risks and applicable foreign currency exchange rates, see Item 7A .

For information concerning our foreign currency

risks and applicable foreign currency exchange rates, see Item 7A .

Quantitative and Qualitative Disclosures About Market Risk—Foreign Currency Risk below.

For information regarding foreign currency risk and implications resulting from the political unrest in Chile, see Item 1A.

Risk Factors and Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview each set forth above.

For information regarding foreign currency risk, see Item 1A.

Risk Factors above.

The amounts presented and discussed below represent 100% of the revenue and expenses of each segment and our corporate operations.

As we have the ability to control certain subsidiaries that are not wholly-owned, we include 100% of the revenue and expenses of these entities in our consolidated statements of operations despite the fact that third parties own significant interests in these entities.

During the third quarter of 2019, we completed the UTS NCI Acquisition, as further defined and described in note 19 to our consolidated financial statements.

The noncontrolling owners’ interests in the operating results of (i) certain subsidiaries of C&W and (ii) Costa Rica are reflected in net earnings or loss attributable to noncontrolling interests in our consolidated statements of operations.

On April 1, 2019, certain B2B operations in Puerto Rico were transferred from our C&W Caribbean and Networks segment to our Liberty Puerto Rico segment, and on January 1, 2020, our captive insurance operation was transferred from our C&W Caribbean and Networks segment to our corporate operations.

These transfers did not have a significant impact on the financial results of our C&W Caribbean and Networks or Liberty Puerto Rico segments.

The noncontrolling owners’ interests in the operating results of (i) certain subsidiaries of C&W and (ii) Liberty Costa Rica are reflected in net earnings or loss attributable to noncontrolling interests in our consolidated statements of operations.

We are subject to inflationary pressures with respect to certain costs and foreign currency exchange risk with respect to costs and expenses that are denominated in currencies other than the respective functional currencies of our reportable segments.

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Adjusted OIBDA is the primary measure used by our chief operating decision maker to evaluate segment operating performance.

Adjusted OIBDA 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 incentive compensation plans.

Adjusted OIBDA is also a key factor that is used by our internal decision makers to determine how to allocate resources to segments.

Our internal decision makers believe Adjusted OIBDA is a meaningful measure because it represents a transparent view of our recurring operating performance that is unaffected by our capital structure and allows management to (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.

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GAAP measures of income or loss.

A reconciliation of total operating income (loss), the nearest U.S.

A reconciliation of total operating income, the nearest U.S.

GAAP measure, to Adjusted OIBDA on a consolidated basis, is presented below for the periods indicated.

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The following table sets forth organic and non-organic changes in Adjusted OIBDA for the period indicated:

C&W Caribbean and Networks C&W Panama Liberty Puerto Rico VTR Costa Rica Corporate Intersegment eliminations Consolidated

C&W Caribbean C&W Panama C&W Networks & LatAm Liberty Puerto Rico Liberty Costa Rica VTR Corporate Intersegment eliminations Consolidated

Adjusted OIBDA for the twelve months ending:

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Year ended December 31,

C&W Caribbean and Networks 42.7 41.8

C&W Caribbean 37.2 34.7

C&W Panama 29.4 35.2

C&W Networks & LatAm 61.3 61.2

Liberty Puerto Rico 36.6 40.1

VTR 33.0 37.9

Costa Rica 31.3 39.2

Liberty Costa Rica 30.5 31.0

VTR (a) 25.7 33.0

(a) During October 2022, we contributed the Chile JV Entities into the Chile JV.

As such, subsequent to September 30, 2022, VTR is no longer included in our consolidated results of operations and is no longer a reportable segment.

Adjusted OIBDA margin is impacted by organic changes in revenue, programming and other direct costs of services and other operating costs and expenses, as further discussed below.

The decreases in the Adjusted OIBDA margin presented for both Liberty Puerto Rico and Costa Rica are primarily related to the inclusion of Liberty Mobile and Telefónica-Costa Rica operations following the AT&T Acquisition and Telefónica-Costa Rica Acquisition, respectively, that each generate lower Adjusted OIBDA margins relative to the legacy operations.

In addition, the decrease in the Adjusted OIBDA margin for Liberty Puerto Rico is also impacted by an increase in roaming expense, and negative margin on handset sales that occurred during the second half of 2021.

The decreases in the Adjusted OIBDA margin for VTR are primarily related to a decline in revenue, as further discussed below.

All of our segments derive their revenue primarily from (i) residential fixed services, including video, broadband internet and fixed-line telephony, (ii) mobile services, and (iii) B2B services.

C&W Caribbean and Networks also provides wholesale communication services over its subsea and terrestrial fiber optic cable networks.

The decrease in Adjusted OIBDA margin for C&W Panama is due in part from the inclusion of Claro Panama operations following the Claro Panama Acquisition, which generates a lower Adjusted OIBDA margin compared to legacy operations.

We incurred in aggregate $26 million of integration costs during the year ended December 31, 2022 in our Liberty Puerto Rico, Liberty Costa Rica and C&W Panama segments.

During the year ended December 31, 2021, we incurred $16 million in our Liberty Puerto Rico and Liberty Costa Rica segments.

The decrease in the Adjusted OIBDA margin for VTR is primarily related to a decline in revenue, RGUs and ARPU resulting from significant competition in Chile.

Most of our segments derive their revenue primarily from (i) residential fixed services, including video, broadband internet and fixed-line telephony, (ii) mobile services and (iii) B2B services.

C&W Networks & LatAm also provides wholesale communication services over its subsea and terrestrial fiber optic cable networks.

While not specifically discussed in the below explanations of the changes in revenue, we are experiencing significant competition in all of our markets.

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In the following discussion, we discuss ARPU changes in terms of the net impact of the above factors on the ARPU that is derived from our video, broadband internet, fixed-line telephony and mobile products.

For the comparisons below, revenue variances, including changes in ARPU, were also influenced by the impacts of COVID-19, as further discussed below and in Overview above.

The following tables set forth the organic and non-organic changes in revenue by reportable segment.

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in millions, except percentages

C&W Caribbean and Networks $ 1,751.2 $ 1,706.8 $ 44.4 $ (25.1) $ 3.9 $ 65.6

C&W Caribbean $ 1,436.8 $ 1,389.9 $ 46.9 $ (8.2) $ — $ 55.1

C&W Panama 642.7 568.1 74.6 — 69.6 5.0

C&W Networks & LatAm 450.8 431.9 18.9 (9.1) — 28.0

Liberty Puerto Rico 1,470.1 1,449.7 20.4 — 24.5 (4.1)

Liberty Costa Rica 441.3 258.5 182.8 (4.3) 169.6 17.5

VTR 450.6 787.5 (336.9) (72.4) (174.8) (89.7)

Costa Rica 256.2 140.0 116.2 (8.9) 111.8 13.3

Corporate (a) 21.6 2.7 18.9 — — 18.9

Corporate 22.2 21.6 0.6 — — 0.6

Intersegment eliminations (99.4) (92.4) (7.0) — — (7.0)

Total $ 4,815.1 $ 4,814.8 $ 0.3 $ (94.0) $ 88.9 $ 5.4

(a) Amounts relate to services we provide for mobile handset insurance following the closing of the AT&T Acquisition.

C&W Caribbean and Networks .

C&W Caribbean and Networks’s revenue by major category is set forth below:

C&W Caribbean .

C&W Caribbean’s revenue by major category is set forth below:

Year ended December 31, Increase (decrease)

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Subscription revenue $ 484.3 $ 473.4 $ 10.9 2.3

Video $ 132.1 $ 142.4 $ (10.3) (7.2)

Broadband internet 273.2 250.0 23.2 9.3

Fixed-line telephony 68.1 74.6 (6.5) (8.7)

Total subscription revenue 473.4 467.0 6.4 1.4

Non-subscription revenue 32.6 34.6 (2.0) (5.8)

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Service revenue 314.5 300.2 14.3 4.8

Interconnect, inbound roaming, equipment sales and other (a) 55.1 44.4 10.7 24.1

Interconnect, inbound roaming, equipment sales and other 67.9 63.9 4.0 6.3

Total residential mobile revenue 382.4 364.1 18.3 5.0

Total residential revenue 899.3 872.1 27.2 3.1

Service revenue 614.6 600.4 14.2 2.4

Subsea network revenue 264.5 258.7 5.8 2.2

Total B2B revenue 879.1 859.1 20.0 2.3

B2B revenue 537.5 517.8 19.7 3.8

Total $ 1,436.8 $ 1,389.9 $ 46.9 3.4

(a) Revenue from inbound roaming was $25 million and $14 million, respectively.

The details of the changes in C&W Caribbean and Networks’s revenue during 2021, as compared to 2020, are set forth below (in millions):

The details of the changes in C&W Caribbean’s revenue during 2022, as compared to 2021, are set forth below (in millions):

Increase (decrease) in residential fixed subscription revenue due to change in:

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ARPU (b) (3.6)

Increase in residential fixed non-subscription revenue 1.9

Decrease in residential fixed non-subscription revenue (1.7)

Total increase in residential fixed revenue 11.6

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Increase in residential mobile interconnect, inbound roaming, equipment sales and other (d) 4.0

Increase in B2B service revenue (e) 20.7

Increase in B2B subsea network revenue (f) 5.8

Increase in B2B revenue (e) 23.3

Total organic increase 55.1

Impact of an acquisition 3.9

Impact of FX (8.2)

(a) The increase is primarily attributable to higher average broadband internet RGUs.

(b) The decrease is primarily due to the net effect of (i) lower ARPU from video and fixed-line telephony services, and (ii) higher ARPU from broadband internet services.

(c) The increase is attributable to (i) higher average number of mobile subscribers, mostly due to an increase in sales initiatives, and (ii) higher ARPU from mobile services, which was mostly a result of relaxed COVID-19-related travel restrictions.

(d) The increase is primarily attributable to (i) higher inbound roaming revenue, primarily related to the relaxing of travel restrictions associated with COVID-19, and (ii) an increase related to the settlement during 2021 of a minimum commitment guarantee associated with inbound roaming.

(e) The increase is primarily due to (i) higher revenue from fixed and mobile services, partially due to the recovery of reduced or suspended service across our markets as a result of the COVID-19 lockdowns, (ii) higher non-recurring revenue, and (iii) higher wholesale call volumes.

(f) The increase is primarily attributable to the net effect of (i) an increase associated with the recognition of deferred revenue and penalties upon termination of two customer contracts, (ii) a decrease related to revenue recognized on a cash basis during 2020 for services provided to a significant customer, and (iii) an increase associated with continued demand for telecommunications capacity on our subsea network.

(a) The increases are primarily attributable to higher average broadband internet RGUs.

(b) The decrease is primarily due to lower ARPU from broadband internet and video services, partially offset by higher ARPU from fixed-line telephony service.

(c) The increase is attributable to the net effect of (i) higher average numbers of mobile subscribers, mostly due to growth from fixed-mobile convergence efforts and increases in sales initiatives, and (ii) declines in ARPU as a result of certain pricing strategies.

(d) The increase is primarily attributable to higher inbound roaming traffic.

(e) The increase is attributable to higher revenues from (i) fixed and managed services, primarily due to broadband internet services-related growth, (ii) mobile services, driven by higher average numbers of subscribers, and (iii) certain non-recurring B2B contracts.

C&W Panama’s revenue by major category is set forth below:

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Subscription revenue $ 102.8 $ 87.9 $ 14.9 17.0

Video $ 25.9 $ 27.8 $ (1.9) (6.8)

Broadband internet 44.9 39.0 5.9 15.1

Fixed-line telephony 17.1 18.8 (1.7) (9.0)

Total subscription revenue 87.9 85.6 2.3 2.7

Non-subscription revenue 7.3 9.5 (2.2) (23.2)

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Service revenue 218.6 176.4 42.2 23.9

Interconnect, inbound roaming, equipment sales and other (a) 44.5 41.0 3.5 8.5

Interconnect, inbound roaming, equipment sales and other 49.5 44.5 5.0 11.2

Total residential mobile revenue 268.1 220.9 47.2 21.4

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Total $ 642.7 $ 568.1 $ 74.6 13.1

(a) Revenue from inbound roaming was $4 million and $2 million, respectively.

The details of the changes in C&W Panama’s revenue during 2022, as compared to 2021, are set forth below (in millions):

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ARPU (b) (3.2)

Decrease in residential fixed non-subscription revenue (c) (2.3)

Decrease in residential fixed non-subscription revenue (2.5)

Total increase in residential fixed revenue

Decrease in residential mobile service revenue (d) (4.2)

Increase in residential mobile interconnect, inbound roaming, equipment sales and other revenue (e) 3.5

Increase in B2B service revenue (f) 48.1

Decrease in residential mobile service revenue (c) (0.7)

Decrease in residential mobile interconnect, inbound roaming, equipment sales and other revenue (d) (5.2)

Increase in B2B revenue (e) 3.1

Total organic increase 5.0

(a) The increase is primarily attributable to higher average broadband internet RGUs.

(b) The decrease is primarily due to lower ARPU from fixed-line telephony and video services.

(d) The decrease is primarily due to the net effect of (i) lower ARPU from mobile services, mainly attributable to prepaid plans as a result of the termination of certain value-added services, and (ii) higher average numbers of mobile subscribers.

(e) The increase is primarily attributable to (i) higher volumes of handset sales, as COVID-19 related lockdowns in 2020 negatively impacted customers’ ability to purchase handsets, and (ii) an increase in inbound roaming revenue, primarily related to the relaxing of travel restrictions associated with COVID-19.

(f) The increase is primarily due to (i) an increase driven by certain government-related projects, some of which were put on hold during 2020 due to the impact of COVID-19, and (ii) higher revenue from mobile services.

Impact of an acquisition 69.6

(a) The increase is primarily attributable to higher average broadband internet and video RGUs.

(b) The decrease is primarily due to lower ARPU from (i) fixed-line telephony services, as customers shift to lower priced plans and (ii) video services, mainly due to customer discounts.

(c) The decrease is primarily due to the net effect of (i) lower ARPU from prepaid mobile services, mainly attributable to lower recharging activity, and (ii) higher average numbers of postpaid mobile subscribers.

(d) The decrease is primarily attributable to lower interconnect revenue due to lower call volume.

(e) The increase is primarily due to increases in the volume of certain projects.

C&W Networks & LatAm .

C&W Networks & LatAm’s revenue by major category is set forth below:

Year ended December 31, Increase

2022 2021 $ %

in millions, except percentages

Service revenue $ 113.7 $ 109.0 $ 4.7 4.3

Subsea network revenue 337.1 322.9 14.2 4.4

Total $ 450.8 $ 431.9 $ 18.9 4.4

The details of the changes in C&W Networks & LatAm’s revenue during 2022, as compared to 2021, are set forth below (in millions):

Increase in B2B service revenue (a) $ 9.7

Increase in B2B subsea network revenue (b) 18.3

Total organic increase 28.0

Impact of FX (9.1)

(a) The increase is primarily attributable to (i) higher B2B connectivity revenue and (ii) growth in managed services.

(b) The increase is primarily due to (i) an increase associated with revenue recognized on a cash basis for services provided to a significant customer, (ii) higher affiliate revenue, (iii) the net negative impact of (a) lower amortized prepaid capacity and operating and maintenance revenue driven by the cancellation of prepaid capacity contracts in prior periods, and (b) higher revenue associated with the recognition of deferred revenue and penalties upon the termination of prepaid capacity contracts, and (iv) a net increase in lease capacity revenue, resulting from customer growth, partially offset by service disconnections and lower revenue from existing customers due to price erosion.

Liberty Puerto Rico.

Liberty Puerto Rico’s revenue by major category is set forth below:

Year ended December 31, Increase

Year ended December 31, Increase (decrease)

2022 2021 $ %

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Subscription revenue $ 457.3 $ 438.2 $ 19.1 4.4

$ 156.7 $ 147.2 $ 9.5 6.5

Broadband internet

253.3 204.7 48.6 23.7

Fixed-line telephony

28.2 25.5 2.7 10.6

Total subscription revenue

438.2 377.4 60.8 16.1

Non-subscription revenue

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Service revenue 448.0 480.8 (32.8) (6.8)

Interconnect, inbound roaming, equipment sales and other (a) 254.4 50.6 203.8 402.8

Interconnect, inbound roaming, equipment sales and other 268.4 253.5 14.9 5.9

Total residential mobile revenue 716.4 734.3 (17.9) (2.4)

Total residential revenue 1,195.8 1,191.8 4.0 0.3

B2B service revenue 220.4 89.8 130.6 145.4

Other revenue (b) 37.5 5.7 31.8 557.9

B2B revenue 220.6 220.4 0.2 0.1

Other revenue 53.7 37.5 16.2 43.2

$ 1,470.1 $ 1,449.7 $ 20.4 1.4

(a) Revenue from inbound roaming was $69 million and $11 million, respectively.

(b) Amounts relate to funds received from the FCC primarily related to Liberty Mobile following the closing of the AT&T Acquisition.

The details of the changes in Liberty Puerto Rico’s revenue during 2022, as compared to 2021, are set forth below (in millions):

Increase in residential fixed subscription revenue due to change in:

Increase (decrease) in residential fixed subscription revenue due to change in:

Average number of RGUs (a) $ 23.3

ARPU (b) (13.9)

Increase in residential fixed non-subscription revenue 0.6

Total increase in residential fixed revenue 10.0

Decrease in residential mobile service revenue (1.5)

Decrease in residential mobile interconnect, inbound roaming, equipment sales and other (c) (3.4)

Increase in B2B service 2.2

Increase in other revenue (d) 3.5

Total organic increase 63.2

Impact of an acquisition and a disposition, net 769.4

Total $ 832.6

(a) The increase is primarily attributable to higher average broadband internet and video RGUs.

The higher average broadband internet RGUs are partially due to increased demand as a result of COVID-19 work-from-home mandates, which subsequently led to increased purchases of video products as a result of bundling offers.

(b) The increase is primarily due to higher ARPU from broadband internet services, and the impact resulting from credits provided to customers during 2020 in connection with the earthquakes that impacted Puerto Rico in January 2020.

(d) The increase is primarily attributable to funds received from the FCC to continue to expand and improve our fixed network in Puerto Rico.

VTR’s revenue by major category is set forth below:

Decrease in residential mobile service revenue (c) (32.8)

Increase in residential mobile interconnect, inbound roaming, equipment sales and other (d) 14.9

Increase in B2B revenue (e) 0.2

Increase in other revenue 3.6

Total organic decrease (4.1)

Impact of an acquisition (f) 24.5

(a) The increase is primarily attributable to higher average broadband internet RGUs.

(b) The decrease is primarily attributable to lower ARPU from broadband internet and video services, which includes the impact of credits issued to customers during 2022 as a result of Hurricane Fiona.

(c) The decrease is primarily due to (i) lower ARPU from mobile services, primarily resulting from higher contract asset amortization driven by increases in handset sales and subsidy levels, and (ii) a decline in the average number of prepaid mobile subscribers.

(d) The increase is primarily due to higher volumes of handset sales.

(e) The increase is primarily due to the net effect of (i) higher revenue associated with data services, and (ii) lower revenue from equipment sales.

(f) The impact of an acquisition includes FCC revenue related to the BBVI Acquisition.

Liberty Costa Rica .

Liberty Costa Rica’s revenue by major category is set forth below:

Year ended December 31, Increase (decrease)

4 unchanged sentences

Subscription revenue $ 137.6 $ 138.5 $ (0.9) (0.6)

Video $ 294.4 $ 291.5 $ 2.9 1.0

Broadband internet 313.4 331.3 (17.9) (5.4)

Fixed-line telephony 77.3 73.5 3.8 5.2

Total subscription revenue 685.1 696.3 (11.2) (1.6)

Non-subscription revenue 5.1 6.2 (1.1) (17.7)

7 unchanged sentences

Total $ 441.3 $ 258.5 $ 182.8 70.7

The details of the changes in VTR’s revenue during 2021, as compared to 2020, are set forth below (in millions):

Decrease in residential fixed subscription revenue due to change in:

The details of the changes in Liberty Costa Rica’s revenue during 2022, as compared to 2021, are set forth below (in millions):

Increase (decrease) in residential fixed subscription revenue due to change in:

Average number of RGUs (a) $ 14.6

1 unchanged sentence

Decrease in residential fixed non-subscription revenue (c) (1.0)

Total decrease in residential fixed revenue

Decrease in residential mobile service revenue (d) (9.9)

Decrease in residential mobile interconnect, inbound roaming, equipment sales and other revenue

Increase in B2B service revenue 0.6

Total organic decrease (55.8)

Total increase in residential fixed revenue 3.2

Increase in residential mobile service revenue (d) 11.2

Increase in residential mobile interconnect, inbound roaming, equipment sales and other 0.1

Increase in B2B revenue (e) 3.0

Total organic increase 17.5

Impact of an acquisition 169.6

Impact of FX (4.3)

Total $ 182.8

(a) The decrease is primarily attributable to lower average broadband internet and video RGUs.

(b) The decrease is primarily due to lower ARPU from broadband internet services and video services, partially the result of continued high levels of competition.

The decline in ARPU from video services is partially offset by increases related to live soccer matches being broadcast on our premium programming that were cancelled during 2020.

(c) The decrease is primarily due to (i) lower volumes of interconnect revenue, (ii) lower installations, and (iii) lower amounts of infrastructure-related engineering projects with local governments.

(d) The decrease is due to lower average numbers of mobile subscribers and lower ARPU from mobile services.

Costa Rica’s revenue by major category is set forth below:

Year ended December 31, Increase (decrease)

(a) The increase is primarily attributable to higher average broadband internet RGUs.

(b) The decrease is primarily due to (i) lower ARPU from video services and fixed-line telephony and (ii) the impact of product mix.

(c) The decrease is primarily due to a discontinued Costa Rica government-sponsored assistance program that provided computer equipment to low-income households offset by an increase in sales of inventory to employees and third-parties.

(d) The increase is primarily attributable to higher postpaid average mobile subscribers.

(e) The increase is primarily due to higher average broadband service revenue.

VTR’s revenue by major category is set forth below:

Year ended December 31, Decrease

2022 2021 $ %

3 unchanged sentences

Subscription revenue $ 392.3 $ 685.1 $ (292.8) (42.7)

Video $ 74.5 $ 79.1 $ (4.6) (5.8)

Broadband internet 59.6 51.4 8.2 16.0

Fixed-line telephony 4.4 3.7 0.7 18.9

Total subscription revenue 138.5 134.2 4.3 3.2

Non-subscription revenue 8.9 14.9 (6.0) (40.3)

1 unchanged sentence

Residential mobile revenue:

Service revenue 70.4 — 70.4 N.M.

Interconnect, inbound roaming, equipment sales and other (a) 27.1 — 27.1 N.M.

Total residential mobile revenue 97.5 — 97.5 N.M.

Service revenue 25.8 48.0 (22.2) (46.3)

Interconnect, inbound roaming, equipment sales and other 2.9 7.3 (4.4) (60.3)

Total residential mobile revenue 28.7 55.3 (26.6) (48.1)

Total residential revenue 429.9 755.3 (325.4) (43.1)

B2B service revenue 14.0 — 14.0 N.M.

Total $ 256.2 $ 140.0 $ 116.2 83.0

- Not Meaningful.

(a) Revenue from inbound roaming was $2 million and nil, respectively.

The details of the changes in Costa Rica’s revenue during 2021, as compared to 2020, are set forth below (in millions):

Increase in residential fixed subscription revenue due to change in:

B2B revenue 20.7 32.2 (11.5) (35.7)

Total (a) $ 450.6 $ 787.5 $ (336.9) (42.8)

(a) The amounts for the 2022 period reflect the revenue of VTR for the period from January 1, 2022 through the October closing of the Chile JV.

The details of the changes in VTR’s revenue during 2022, as compared to 2021, are set forth below (in millions):

Decrease in residential fixed subscription revenue due to change in:

Average number of RGUs (a) $ (22.2)

Increase in residential fixed non-subscription revenue 0.7

Total organic increase 13.3

Impact of an acquisition 111.8

ARPU (b) (55.5)

Decrease in residential fixed non-subscription revenue (0.9)

Total decrease in residential fixed revenue

Decrease in residential mobile service revenue (c) (7.8)

Decrease in residential mobile interconnect, inbound roaming, equipment sales and other revenue

Decrease in B2B service revenue (0.8)

Total organic decrease (89.7)

Impact of disposition (174.8)

Impact of FX (72.4)

Total $ (336.9)

(a) The increase is primarily attributable to higher average broadband internet RGUs.

(b) The increase is primarily due to higher ARPU from broadband internet.

(a) The decrease is primarily attributable to lower average broadband internet and video RGUs.

(b) The decrease is primarily due to lower ARPU from broadband internet services, mainly associated with (i) increased competition that generally resulted in (a) the churn of higher-ARPU customers and (b) the addition of lower-ARPU customers, and (ii) strategic initiatives implemented during 2022.

Higher discounts and lower-ARPU customers related to video and telephony services also contributed to the decline in ARPU.

(c) The decrease is primarily due to (i) lower ARPU from mobile services, mainly associated with strategic initiatives implemented during 2022, and (ii) lower average numbers of mobile subscribers.

Programming and other direct costs of services

4 unchanged sentences

Increase (decrease) from:

Year ended December 31, Increase Acquisitions (disposition), net Organic

Year ended December 31, Increase (decrease) Acquisitions (disposition), net Organic

Programming and copyright $ 360.3 $ 441.4 $ (81.1) $ (20.2) $ (42.8) $ (18.1)

3 unchanged sentences

Total programming and other direct costs of services $ 1,210.5 $ 1,214.4 $ (3.9) $ (27.6) $ 7.3 $ 16.4

C&W Caribbean and Networks .

The following table sets forth the organic and non-organic changes in programming and other direct costs of services for our C&W Caribbean and Networks segment.

C&W Caribbean .

The following table sets forth the organic and non-organic changes in programming and other direct costs of services for our C&W Caribbean segment.

Year ended December 31, Increase (decrease) Increase (decrease) from:

2021 2020 FX An acquisition Organic

2022 2021 FX Organic

Programming and copyright $ 85.9 $ 92.8 $ (6.9) $ (0.6) $ (6.3)

3 unchanged sentences

• Programming and copyright:

The organic increase is primarily due to the negative impact of the reassessment and release of various accruals in certain of our markets during 2020.

• Interconnect:

The organic decrease is primarily due to individually insignificant decreases that were partially offset by higher wholesale call volumes.

The organic decrease is primarily due to the (i) the expiration of certain programming content during the first half of 2022, and (ii) the positive impact associated with the reassessment of a content-related accrual during 2022.

• Equipment and other:

The organic increase is primarily driven by the easing of COVID-19 related restrictions in certain of our markets, which resulted in (i) higher mobile equipment sales volume, and (ii) higher B2B data revenue and equipment sales.

The organic increase is primarily due to (i) higher capacity fees incurred in connection with the purchase of wholesale services from C&W Networks & LatAm, (ii) higher costs associated with certain non-recurring B2B contracts and (iii) higher volumes of handset sales to B2B customers.

The following table sets forth the organic changes in programming and other direct costs of services for our C&W Panama segment.

Year ended December 31, Organic increase (decrease)

Increase (decrease) from:

Year ended December 31, Increase An acquisition

2022 2021 Organic

Programming and copyright $ 18.5 $ 14.9 $ 3.6 $ 1.0 $ 2.6

3 unchanged sentences

Total programming and other direct costs of services $ 207.4 $ 186.8 $ 20.6 $ 17.8 $ 2.8

• Programming and copyright:

The organic increase is primarily due to RGU growth.

• Interconnect:

The organic decrease is primarily due to lower call volumes.

• Equipment and other:

The organic increase is primarily due to (i) an increase driven by certain nonrecurring government-related projects, some of which were put on hold during 2020 due to the impact of COVID-19, and (ii) higher volumes of mobile handset sales, mainly due to the easing of COVID-19 related restrictions.

The organic increase is primarily due to (i) higher volumes and unit costs of handset sales and (ii) higher costs associated with certain non-recurring B2B contracts.

C&W Networks & LatAm.

The following table sets forth the organic changes in programming and other direct costs of services for our C&W Networks & LatAm segment.

Year ended December 31, Increase Increase (decrease) from:

2022 2021 FX Organic

Interconnect $ 45.6 $ 45.4 $ 0.2 $ (0.8) $ 1.0

Equipment and other

14.4 10.3 4.1 (1.0) 5.1

Total programming and other direct costs of services $ 60.0 $ 55.7 $ 4.3 $ (1.8) $ 6.1

• Equipment and other:

The organic increase is primarily due to lower amounts of capitalizable costs associated with licenses, as part of a migration into contracts with shorter terms and more cloud-based arrangements.

Liberty Puerto Rico .

The following table sets forth the organic changes in programming and other direct costs of services for our Liberty Puerto Rico segment.

Increase Increase (decrease) from:

Year ended December 31, Acquisition (disposition), net

Increase (decrease) Increase (decrease) from:

Year ended December 31, An Acquisition

2022 2021 Organic

4 unchanged sentences

Total programming and other direct costs of services $ 442.4 $ 419.4 $ 23.0 $ 3.4 $ 19.6

• Programming and copyright:

The organic increase is primarily attributable to higher programming rates and higher average video subscribers.

• Interconnect:

The organic increase is primarily due to higher roaming costs, including the impact from the renegotiation of a certain roaming agreement during the fourth quarter of 2021.

The organic decrease primarily relates to lower roaming expense due in part to (i) lower rates and (ii) the positive impact from the renegotiation of a certain roaming agreement during the fourth quarter of 2021.

• Equipment and other:

The organic decrease is primarily due to the net effect of (i) lower equipment costs and (ii) $1 million of equipment-related integration costs incurred in 2021.

The following table sets forth the organic and non-organic changes in programming and other direct costs of services for our VTR segment.

Year ended December 31, Increase (decrease) Increase (decrease) from:

2021 2020 FX Organic

The organic increase is primarily associated with (i) higher sales volume, (ii) an increase related to lower of cost or market adjustments on equipment-related inventory, and (iii) equipment-related integration costs .

Liberty Costa Rica .

The following table sets forth the organic and non-organic changes in programming and other direct costs of services for our Liberty Costa Rica segment.

Increase (decrease) from:

Year ended December 31, Increase (decrease) FX An acquisition Organic

Programming and copyright $ 33.9 $ 35.9 $ (2.0) $ (1.5) $ — $ (0.5)

3 unchanged sentences

Total programming and other direct costs of services $ 106.6 $ 67.8 $ 38.8 $ (1.0) $ 38.9 $ 0.9

• Programming and copyright:

The organic increase is primarily due to higher premium and basic content rates.

During 2020, programming costs were lower due to the renegotiation of a programming contract governing rates for live soccer matches, which were cancelled as a result of COVID-19.

In addition, the comparison includes a decrease of $1 million related to the foreign currency impact of programming contracts denominated in U.S.

• Interconnect:

The organic decrease is primarily due to (i) lower interconnect rates and volumes, and (ii) a decrease in MVNO charges, as we renegotiated our contract during the second quarter of 2021.

• Equipment and other:

The organic decrease is due to (i) lower volumes of handset sales, (ii) lower amounts of infrastructure-related engineering projects with local governments, and (iii) the net effect of (a) higher handset prices and (b) decreases associated with the foreign currency impact of handset contracts denominated in U.S.

The following table sets forth the organic and non-organic changes in programming and other direct costs of services for our Costa Rica segment.

Increase (decrease) from:

Year ended December 31, Increase FX An acquisition Organic

The following table sets forth the organic and non-organic changes in programming and other direct costs of services for our VTR segment.

Year ended December 31, Decrease Increase (decrease) from:

2022 2021 FX A disposition Organic

Programming and copyright $ 113.5 $ 188.8 $ (75.3) $ (18.1) $ (43.8) $ (13.4)

4 unchanged sentences

• Programming and copyright:

The organic increase is primarily due to (i) the negative impact associated with contract negotiations that resulted in the reassessment and release of various accruals during 2020 and (ii) an increase in certain premium content costs.

In addition, the comparison includes an increase of $2 million related to the foreign currency impact of programming contracts denominated in U.S.

The organic decrease is primarily due to the net effect of (i) lower average subscribers, (ii) lower content rates, (iii) the positive impacts associated with the renegotiation of certain content agreements, (iv) the positive impact associated with the reassessment of an accrual associated with video-on-demand content-related costs during 2022, and (v) an increase related to a settlement associated with a programming contract during 2022.

• Interconnect:

The organic increase is primarily due to (i) higher rates and (ii) higher national leased capacity.

• Equipment and other:

The organic decrease is due to lower volumes of equipment sales.

Other operating costs and expenses

Other operating costs and expenses set forth in the table below comprise the following cost categories:

Other operating costs and expenses set forth in the tables below comprise the following cost categories:

• Personnel and contract labor-related costs, which primarily include salary-related and cash bonus expenses, net of capitalizable labor costs, and temporary contract labor costs;

3 unchanged sentences

• Facility, provision, franchise and other, which primarily includes facility-related costs, provision for bad debt expense, franchise-related fees, bank fees, insurance, vehicle-related, travel and entertainment and other operating-related costs;

• Share-based compensation expense that relates to (i) equity awards issued to our employees and Directors and (ii) and with respect to 2021 and 2020, bonus-related expenses that will be paid in the form of equity.

• Share-based compensation expense that relates to (i) equity awards issued to our employees and Directors and (ii) certain bonus-related expenses that are paid in the form of equity.

Consolidated .

1 unchanged sentence

Increase (decrease) from:

Year ended December 31, Increase Acquisition (disposition), net Organic

Year ended December 31, Increase (decrease) Acquisitions (disposition), net Organic

Personnel and contract labor $ 597.7 $ 575.1 $ 22.6 $ (10.9) $ 1.4 $ 32.1

9 unchanged sentences

For additional information regarding our share-based compensation, see Results of Operations (below Adjusted OIBDA) discussion and analysis below.

C&W Caribbean and Networks .

The following table sets forth the organic and non-organic changes in other operating costs and expenses for our C&W Caribbean and Networks segment.

Increase (decrease) from:

Year ended December 31, Increase (decrease) Acquisition (disposition), net Organic

C&W Caribbean .

The following table sets forth the organic and non-organic changes in other operating costs and expenses for our C&W Caribbean segment.

Year ended December 31, Increase (decrease) Increase (decrease) from:

2022 2021 FX Organic

Personnel and contract labor $ 204.6 $ 206.7 $ (2.1) $ (0.9) $ (1.2)

6 unchanged sentences

• Personnel and contract labor:

The organic decrease is due to the net effect of (i) lower salaries and other personnel costs, mainly associated with the benefit of certain restructuring activities, (ii) higher staff costs related to increased sales activities, and (iii) lower capitalized labor associated with fewer employees and lower capitalization rates.

The organic decrease is primarily due to the net effect of (i) a decrease resulting form lower bonus-related achievement levels and (ii) an increase as certain employee bonuses that were granted on a cash-basis in 2022 and recognized as personnel costs, as compared to grants of share-based awards for certain employee bonuses in 2021 that were recognized as share-based compensation.

• Network-related:

The organic increase is primarily due to (i) higher subsea cable repairs, (ii) higher utility costs, and (iii) rate increases on pole rentals and fiber leases.

The organic decrease is primarily due to the net effect of (i) lower network-related maintenance costs, mainly driven by the renegotiation and cancellation of certain vendor contracts as well as lower overall spending, (ii) lower capacity charges associated with the use of C&W Networks & LatAm’s subsea network and (iii) higher utility costs.

• Service-related:

The organic increase is primarily due to professional services and IT-related expense.

• Commercial:

The organic increase is primarily due to higher marketing and sales costs, as promotional activities were reduced during 2020 due to certain adverse economic impacts caused by COVID-19.

• Facility, provision, franchise and other costs:

The organic decrease is primarily due to (i) lower bad debt provisions, as the impact of COVID-19 resulted in higher bad debt expense during 2020 due to (a) delays in collections, (b) higher expected credit losses associated with certain B2B customers and (c) changes in our general expectations related to our customers’ ability to pay, and (ii) lower franchise fees.

The organic decrease is primarily due to (i) lower call center volumes and (ii) lower marketing and sales costs.

The following table sets forth the organic changes in other operating costs and expenses for our C&W Panama segment.

Year ended December 31, Organic increase (decrease)

Increase (decrease) from:

Year ended December 31, Increase An Acquisition

2022 2021 Organic

Personnel and contract labor $ 77.6 $ 69.8 $ 7.8 $ 6.0 $ 1.8

5 unchanged sentences

Total other operating costs and expenses $ 250.8 $ 185.2 $ 65.6 $ 50.2 $ 15.4

• Facility, provision, franchise and other costs:

The organic decrease is primarily due to lower bad debt provisions, as the impact of COVID-19 resulted in higher bad debt expense during 2020 generally due to (i) delays in collections, (ii) higher expected credit losses associated with certain B2B customers and (iii) changes in our general expectations related to our customers’ ability to pay.

• Facility, provision, franchise and other:

The organic increase is primarily driven by higher bad debt expense, primarily driven by a factoring arrangement and an increase in underlying rates used to compute the expected credit loss.

C&W Networks & LatAm.

The following table sets forth the organic changes in other operating costs and expenses for our C&W Networks & LatAm segment.

Year ended December 31, Increase (decrease) Increase (decrease) from:

2022 2021 FX Organic

Personnel and contract labor $ 43.6 $ 44.3 $ (0.7) $ (2.6) $ 1.9

Network-related 43.3 45.8 (2.5) (1.1) (1.4)

Service-related 4.5 3.7 0.8 — 0.8

Commercial 1.4 1.0 0.4 — 0.4

Facility, provision, franchise and other 21.7 17.1 4.6 (1.5) 6.1

Share-based compensation expense 3.4 4.6 (1.2) — (1.2)

Total other operating costs and expenses $ 117.9 $ 116.5 $ 1.4 $ (5.2) $ 6.6

• Facility, provision, franchise and other:

The organic increase is primarily due to higher bad debt provisions and travel-related costs.

Liberty Puerto Rico .

1 unchanged sentence

Increase (decrease) from:

Year ended December 31, Increase Acquisition (disposition), net

Year ended December 31, Increase (decrease) An acquisition

2022 2021 Organic

7 unchanged sentences

• Personnel and contract labor:

The organic increase is primarily due to higher salaries and other personnel costs .

The organic increase is primarily due to the net effect of (i) higher salaries and other personnel costs, including the impact of higher amortization of deferred commissions associated with certain accounting in connection with the AT&T Acquisition, (ii) an increase in charges allocated from our Corporate operations, and (iii) lower bonus-related expenses.

• Network-related:

The organic increase is primarily due to the net effect of (i) incremental expenses incurred in operating the network as a result of the impacts from Hurricane Fiona, (ii) lower costs related to the termination of the transition services agreement entered into with AT&T associated with network maintenance and licenses, and (iii) an increase in network-related integration costs associated with the AT&T Acquisition.

• Service-related:

We incurred service-related integration costs associated with the AT&T Acquisition of $6 million and $7 million during 2021 and 2020, respectively.

The service-related integration costs incurred during 2021 are mostly included in the increase from an acquisition (disposition), net, in the above table and are expected to grow in future periods.

The organic increase is primarily due to the net effect of (i) an increase in charges allocated from our Corporate operations and (ii) lower costs associated with the termination of the transition services agreement entered into with AT&T associated with commissions and software licenses.

Service-related integration costs associated with the AT&T Acquisition are expected to continue to grow in future periods.

• Commercial:

The organic increase is primarily due to (i) increased marketing costs, including $2 million of rebranding commercial-related integration costs associated with the AT&T Acquisition, and (ii) higher call center volumes, partially attributable to work-from-home and remote learning mandates resulting from COVID-19.

In addition, the 2021 increase from an acquisition (disposition), net, in the above table includes $2 million of rebranding commercial-related integration costs associated with the AT&T Acquisition.

• Facilities, provision, franchise and other:

The organic increase includes an increase related to a payment made during 2021 to settle certain 2011 property tax claims.

The following table sets forth the organic and non-organic changes in other operating costs and expenses for our VTR segment.

The organic decrease is primarily due to the net effect of (i) lower marketing costs, mainly driven by rebranding-related integration costs associated with the AT&T Acquisition incurred during 2021, (ii) higher amortization of deferred commissions associated with certain accounting in connection with the AT&T Acquisition, and (iii) lower call center costs driven by both volume and rates.

• Facility, provision, franchise and other:

The organic increase was impacted by the net effect of (i) an increase in rent expense, driven by purchase accounting adjustments associated with the AT&T Acquisition that were recorded during 2021, (ii) an increase in bank-related fees associated with certain services being provided under a transaction service agreement, (iii) a decrease in bad debt expense resulting from lower expected credit loss rates established during 2022, (iv) higher facility-related costs, including security costs and maintenance costs resulting from the impacts of Hurricane Fiona, and (v) a decrease resulting from a payment made during the second quarter of 2021 to settle certain 2011 property tax claims.

Liberty Costa Rica .

The following table sets forth the organic and non-organic changes in other operating costs and expenses for our Liberty Costa Rica segment.

Increase (decrease) from:

Year ended December 31, Increase (decrease) FX Organic

Year ended December 31, Increase FX An acquisition Organic

Personnel and contract labor $ 27.5 $ 19.9 $ 7.6 $ (0.6) $ 7.8 $ 0.4

5 unchanged sentences

Total other operating costs and expenses $ 202.2 $ 111.6 $ 90.6 $ (1.7) $ 84.5 $ 7.8

• Personnel and contract labor:

The organic decrease is primarily due to lower salary expense as a result of a restructuring program implemented during the first half of 2021.

• Network-related:

The organic increase is primarily due to (i) higher rates associated with network access-related contract labor, and (ii) higher maintenance costs.

The organic increase is primarily due to higher maintenance-related costs.

• Service-related:

The organic increase is primarily due to higher information technology-related project costs.

• Commercial:

The organic increase is primarily due to the net effect of (i) higher sales commissions, (ii) a decrease in marketing and advertising expenses, and (iii) higher call center volumes.

The organic increase is primarily due to higher third-party sales commission costs.

• Facility, provision, franchise and other costs:

The organic decrease is primarily due to (i) lower bad debt provisions, and (ii) lower operating lease expense as a result of ceasing the amortization of our right of use assets in connection with held for sale accounting of the Chile JV Entities, as further described in note 9 to our consolidated financial statements.

The following table sets forth the organic and non-organic changes in other operating costs and expenses for our Costa Rica segment.

Increase (decrease) from:

Year ended December 31, Increase FX An acquisition Organic

The organic decrease is primarily due to the net effect of (i) higher bad debt provisions, (ii) lower rental expenses, (iii) lower telecommunications costs and (iv) higher collection-related fees.

Included in the increase from an acquisition in the table above are significant integration-related costs, associated with the Liberty Telecomunicaciones Acquisition.

The following table sets forth the organic and non-organic changes in other operating costs and expenses for our VTR segment.

Year ended December 31, Decrease Increase (decrease) from:

2022 2021 FX A disposition Organic

Personnel and contract labor $ 41.8 $ 61.1 $ (19.3) $ (6.8) $ (14.3) $ 1.8

5 unchanged sentences

Total other operating costs and expenses $ 204.0 $ 310.2 $ (106.2) $ (33.0) $ (69.5) $ (3.7)

• Service-related:

The organic increase is primarily due to higher professional services fees, including $1 million of costs associated with the Telefónica Costa Rica Acquisition, and higher costs associated with certain information technology projects that were put on hold in 2020 due to the economic uncertainty of COVID-19.

In addition, during 2021 we incurred $2 million of integration costs associated with the Telefónica Costa Rica Acquisition that are included in the increase from an acquisition.

Integration costs are expected to grow significantly during 2022.

• Personnel and contract labor:

The organic increase is primarily due to the net effect of (i) higher salaries and other personnel costs due to the effect of inflation and (ii) lower bonus-related expenses.

• Commercial:

The organic increase is primarily due to higher sales commissions, as we began to recover from the adverse economic impacts caused by COVID-19.

The organic decrease is due to the net effect of (i) lower sales commissions, (ii) lower call center activity and (iii) higher marketing and advertising costs, primarily related to a commitment to sponsor a music festival that was postponed during each of the past two years due to COVID-19.

• Facility, provision, franchise and other costs:

The organic decrease is primarily due to the net effect of (i) lower operating lease rent expense as a result of ceasing the amortization of our right of use assets in connection with held

for sale accounting of the Chile JV Entities, as further described in note 8 to our consolidated financial statements, and (ii) higher bad debt provisions.

The following table sets forth the organic and non-organic changes in other operating costs and expenses for our corporate operations.

7 unchanged sentences

• Personnel and contract labor:

The organic increase is primarily attributable to higher salaries and other personnel costs, mainly resulting from higher staffing levels in the operations center in Panama.

The organic increase is primarily attributable to (i) higher salaries and other personnel costs, mainly resulting from higher staffing levels in our operations center in Panama and (ii) the net impact of (a) an increase as certain employee bonuses that were granted on a cash-basis in 2022 and recognized as personnel costs, as compared to grants of share-based awards for certain employee bonuses in 2021 that were recognized as share-based compensation, and (b) a decrease resulting form lower bonus-related achievement levels.

• Service-related:

1 unchanged sentence

• Facility, provision, franchise and other:

The organic increase is primarily attributable to higher expenses associated with a mobile handset insurance program that began during the fourth quarter of 2020 following the closing of the AT&T Acquisition.

The organic increase is primarily due to an increase in travel-related costs.

Results of operations (below Adjusted OIBDA)—2022 compared to 2021

Share-based compensation expense (included in other operating costs and expenses)

Share-based compensation expense increased $21 million during 2021, as compared to 2020, primarily due to additional awards granted during 2021 to our employees and Directors.

Share-based compensation expense decreased $25 million during 2022, as compared to 2021, primarily due to (i) lower grant-date fair values driven by lower average share prices during 2022, and (ii) a change in the bonus structure, whereby certain employees whose bonuses were paid in the form of shares during 2021 were granted on a cash-basis during 2022.

For additional information regarding our share-based compensation, see note 15 to our consolidated financial statements.

Depreciation and amortization

Our depreciation and amortization expense increased $46 million or 5% during 2021, as compared to 2020, primarily due to the net effect of (i) increases attributable to assets acquired by Liberty Puerto Rico and, to a lesser extent, Costa Rica following the closing of the AT&T Acquisition and the Telefónica Costa Rica Acquisition, respectively, (ii) a decrease associated with certain assets becoming fully depreciated, (iii) an increase in property and equipment additions, primarily associated with the installation of CPE, baseline related additions and the expansion and upgrade of our networks and other capital initiatives, and (iv) a decrease at VTR as we ceased recording depreciation expense when we began accounting for the Chile JV Entities as held for sale.

Our depreciation and amortization expense decreased $54 million or 6% during 2022, as compared to 2021, primarily due to the net effect of (i) declines of $128 million at VTR, as we ceased recording depreciation expense during the third quarter of 2021 when we began accounting for the Chile JV Entities as held for sale, (ii) increases at Liberty Costa Rica and C&W Panama resulting from the Liberty Telecomunicaciones Acquisition and the Claro Panama Acquisition, respectively, and (iii) increases in property and equipment additions.

Impairment, restructuring and other operating items, net

4 unchanged sentences

Total $ 619.2 $ 665.0

(a) The 2021 amount primarily includes a goodwill impairment associated with our C&W Caribbean and Networks segment.

The 2020 amount primarily includes goodwill impairment charges of $174 million at C&W Panama and $101 million at various reporting units within the C&W Caribbean and Networks segment, mostly related to the economic impacts associated with COVID-19.

(b) Amounts include employee severance and termination costs related to certain reorganization activities and contract termination and other related charges, primarily at VTR and C&W Caribbean and Networks.

(c) The 2021 amount includes direct acquisition costs, primarily related to the Telefónica Costa Rica Acquisition and a gain of $9 million on the disposition of certain B2B operations in our Liberty Puerto Rico segment that was completed in January 2021.

The 2020 amounts primarily include direct acquisition costs related to the AT&T Acquisition.

(a) Amounts primarily consist of goodwill impairment charges associated with certain reporting units within the C&W Caribbean segment.

(b) Amounts include employee severance and termination costs related to certain reorganization activities and contract termination and other related charges, primarily at (i) C&W Panama and C&W Caribbean during 2022 and (ii) VTR and C&W Caribbean during 2021.

(c) The 2022 amount includes direct acquisition costs, primarily related to the Chile JV Transaction and the Claro Panama Acquisition.

The 2021 amount includes direct acquisition costs, primarily related to the Liberty Telecomunicaciones Acquisition, and a gain on the disposition of certain B2B operations in our Liberty Puerto Rico segment that was completed in January 2021.

Interest expense

Our interest expense decreased $6 million during 2021, as compared to 2020.

The decrease is primarily due to the net effect of (i) lower weighted-average interest rates and (ii) higher average outstanding debt balances.

Our interest expense increased $29 million during 2022, as compared to 2021.

The increase is primarily attributable to the net effect of (i) the negative impact of FX, (ii) higher weighted-average interest rates and (iii) lower average outstanding debt balances, primarily as a result of the formation of the Chile JV in October 2022.

For additional information regarding our outstanding indebtedness, see note 9 to our consolidated financial statements.

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Our realized and unrealized gains or losses on derivative instruments primarily include (i) unrealized changes in the fair values of our derivative instruments that are non-cash in nature until such time as the derivative contracts are fully or partially settled and (ii) realized gains or losses upon the full or partial settlement of the derivative contracts.

The details of our realized and unrealized gains (losses) on derivative instruments, net, are as follows:

The details of our realized and unrealized gains on derivative instruments, net, are as follows:

Year ended December 31,

Cross-currency and interest rate derivative contracts (a) (b) $ 565.4 $ (328.6)

Cross-currency and interest rate derivative contracts (a) $ 404.3 $ 565.4

Foreign currency forward contracts (13.5) 25.8

Weather Derivatives (c) (27.1) (16.3)

Weather Derivatives (b) (31.4) (27.1)

Total $ 359.4 $ 564.1

(a) The gains (losses) during 2021 and 2020 are primarily attributable to the net effect of (i) changes in FX rates, predominantly due to changes in the value of the Chilean peso relative to the U.S.

(a) The gains during 2022 and 2021 are primarily attributable to the net effect of (i) changes in FX rates, predominantly due to changes in the value of the Chilean peso, prior to the formation of the Chile JV, relative to the U.S.

dollar, and (ii) changes in interest rates.

These amounts include gains (losses) associated with changes in our credit risk valuation adjustments of ($41 million) and $47 million, respectively, which for 2021 includes a net loss of $30 million related to the Chile JV Entities, and for 2020 was primarily due to increased credit risk stemming from market reaction to the COVID-19 outbreak.

(b) The loss during 2020 includes a realized gain of $71 million associated with the settlement of certain cross-currency swaps at VTR in June 2020 that were unwound in connection with the July 2020 refinancing of certain VTR debt in 2020.

For additional information regarding the refinancing, see note 10 to our consolidated financial statements.

These amounts include losses associated with changes in our credit risk valuation adjustments of $4 million and $41 million, respectively.

Included in the 2021 credit risk valuation adjustment is a net loss of $30 million related to the Chile JV Entities.

(b) Amounts represent the amortization of premiums associated with our Weather Derivatives.

For additional information concerning our derivative instruments, see notes 5 and 6 to our consolidated financial statements and Item 7A.

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Unrealized foreign currency transaction gains or losses are computed based on period-end exchange rates and are non-cash in nature until such time as the amounts are settled.

The details of our foreign currency transaction gains (losses), net, are as follows:

The details of our foreign currency transaction losses, net, are as follows:

Year ended December 31,

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Intercompany payables and receivables denominated in a currency other than the entity’s functional currency

(48.4) (53.2)

Other (a) (6.0) (21.9)

Total $ (194.3) $ (319.6)

(a) Primarily includes (i) third-party receivables and payables denominated in a currency other than an entity’s functional currency, (ii) cash denominated in a currency other than an entity’s functional currency and (iii) U.S.

dollar-denominated debt issued by a CRC functional currency entity.

(a) Primarily includes (i) third-party receivables and payables denominated in a currency other than an entity’s functional currency, (ii) U.S.

dollar-denominated debt issued by a CRC functional currency entity and (iii) cash denominated in a currency other than an entity’s functional currency.

Gains or losses on debt modification and extinguishment, net

We recognized losses on debt modification and extinguishment, net, of $57 million and $45 million during 2021 and 2020, respectively.

The losses during 2021 are associated with (i) the payment of redemption premiums and the write-off of unamortized deferred financing costs related to the repayment of certain C&W Notes, (ii) the write-off of unamortized discounts and deferred financing costs related to the repayment of the 2026 SPV Credit Facility, (iii) the payment of breakage fees and the write-off of unamortized deferred financing costs related to the repayments of the VTR TLB-1 Facility and VTR TLB-2 Facility, (iv) the payment of redemption premiums and the write-off of unamortized deferred financing costs related to the repayment of the 2027 LPR Senior Secured Notes and (v) the payments of redemption premiums and the write-offs of unamortized deferred financing costs related to partial redemptions of the 2028 VTR Senior Secured Notes.

The losses during 2020 are associated with (i) the payment of call premiums and the write-off of unamortized deferred financing costs related to the repayment of certain senior notes then outstanding at VTR and (ii) the write-off of unamortized discounts and deferred financing costs associated with the repayment of the C&W Term Loan B-4 Facility.

Our gains or losses on debt modification and extinguishment generally include (i) premiums or discounts associated with redemptions and/or repurchases of debt, (ii) the write-off of unamortized deferred financing costs, premiums and/or discounts and/or (iii) breakage fees.

We recognized gains (losses) on debt extinguishment, net, of $41 million and ($57 million) during 2022 and 2021, respectively.

The gains during 2022 are associated with the buyback of certain VTR debt at fair value prior to the formation of the Chile JV.

The losses during 2021 are primarily associated with refinancing activity at C&W, Liberty Puerto Rico and VTR.

For additional information concerning our losses on debt modification and extinguishment, see note 9 to our consolidated financial statements.

Gain on Chile JV Transaction

In connection with the Chile JV Transaction, we recognized a pre-tax gain during 2022 of $169 million.

For additional information, see note 8 to our consolidated financial statements.

Other income or expense, net

Our other income (expense), net, generally includes (i) certain amounts associated with our defined benefit plans, including interest expense and expected return on plan assets, and (ii) interest income on cash, cash equivalents and restricted cash.

We recognized other income (expense), net, of ($42 million) and $5 million during 2021 and 2020, respectively.

The expense during 2021 primarily relates to an impairment associated with a cost method investment.

The 2020 period reflects the net effect of (i) interest income, including interest we generated on restricted cash held in escrow in advance of the closing of the AT&T Acquisition, and (ii) other individually insignificant expenses.

We recognized other expense, net, of $28 million and $42 million during 2022 and 2021, respectively.

The expense during each year primarily relates to impairment of a cost method investment.

Income tax benefit or expense

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For additional information, see note 13 to our consolidated financial statements.

We recognized income tax benefit (expense) of ($190 million) and $28 million during 2021 and 2020, respectively.

The income tax expense attributable to our earnings before income taxes during 2021 differs from the amounts computed using the statutory tax rate, primarily due to detrimental effects of (i) net increases in valuation allowances, (ii) permanent tax differences, such as non deductible goodwill impairment and other non-deductible expenses, (iii) expiration of deferred tax assets (which are entirely offset by valuation allowance);

and (iv) inclusion of withholding taxes on cross-border payments.

We recognized income tax expense of $87 million and $173 million during 2022 and 2021, respectively.

The income tax expense attributable to our loss before income taxes during 2022 differs from the amounts computed using the statutory tax rate, primarily due to the detrimental effects of (i) permanent tax differences, such as non deductible goodwill impairment and other non-deductible expenses, (ii) effect of rate changes (but which are nearly entirely offset by valuation allowance), (iii) changes in uncertain tax positions, (iv) inclusion of withholding taxes on cross-border payments, (v) expiration of deferred tax assets (which are entirely offset by valuation allowance), and (vi) tax effect of the enactment of a Barbados Pandemic Contribution Levy.

These negative impacts to our effective tax rate were partially offset by the beneficial effects of (i) net decreases in valuation allowances, (ii) permanent tax differences, such as non-taxable income, (iii) jurisdictional rate differences, and (iv) effect of tax credits.

These negative impacts to our effective tax rate were partially offset by the beneficial effects of (i) jurisdictional rate differences, (ii) changes in enacted tax rates (but which are nearly entirely offset by valuation allowance), and (iii) permanent tax differences, such as non-taxable income.

The income tax benefit attributable to our loss before income taxes during 2020 differs from the amounts computed using the statutory tax rate (based on the Bermuda statutory tax rate of 0%), primarily due to the beneficial effects of (i) international rate differences, (ii) changes in enacted tax laws (but which are nearly entirely offset by valuation allowance), and (iii) net favorable changes in uncertain tax positions.

These beneficial impacts to our effective tax rate were partially offset by the negative effects of (i) increases in valuation allowances, (ii) permanent items, such as non-deductible goodwill impairment and other non-deductible expenses, and (iii) the inclusion of withholding taxes on cross-border payments.

Net earnings or loss

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Net non-operating expenses $ (209.5) $ (381.8)

Income tax benefit (expense) $ (189.5) $ 27.8

Income tax expense $ (86.5) $ (173.3)

Net loss $ (201.9) $ (487.8)

4 unchanged sentences

We reported net losses attributable to noncontrolling interests of $26 million and $50 million during 2022 and 2021, respectively.

Year Ended December 31, 2020 as Compared with Year Ended December 31, 2019

Consolidated Adjusted OIBDA

As further described above, consolidated Adjusted OIBDA is a non-U.S.

GAAP measure.

A reconciliation of total operating income (loss), the nearest U.S.

GAAP measure, to Adjusted OIBDA on a consolidated basis, is presented below.

Year ended December 31,

Operating income $ 93.2 $ 325.8

Share-based compensation expense 97.5 57.5

Depreciation and amortization 918.7 889.9

Impairment, restructuring and other operating items, net 375.3 268.2

Consolidated Adjusted OIBDA $ 1,484.7 $ 1,541.4

The following table sets forth organic and non-organic changes in Adjusted OIBDA for the period indicated.

C&W Caribbean and Networks C&W Panama Liberty Puerto Rico VTR Costa Rica Corporate Intersegment eliminations Consolidated

Adjusted OIBDA for the twelve months ending:

December 31, 2019 $ 732.1 $ 227.6 $ 203.2 $ 381.7 $ 51.9 $ (55.1) $ — $ 1,541.4

Organic changes related to:

Revenue (58.2) (82.5) 37.8 (28.6) 7.1 2.7 (3.8) (125.5)

Programming and other direct costs 27.2 28.7 (6.1) 1.5 (1.5) — 3.3 53.1

Other operating costs and expenses 30.3 3.4 (14.0) (7.9) (2.6) 7.9 0.5 17.6

Non-organic increases (decreases):

FX (11.8) — — (39.7) — — — (51.5)

Acquisitions/disposition, net (6.4) — 56.0 — — — — 49.6

December 31, 2020 $ 713.2 $ 177.2 $ 276.9 $ 307.0 $ 54.9 $ (44.5) $ — $ 1,484.7

Adjusted OIBDA Margin

The following table sets forth the Adjusted OIBDA margins of each of our reportable segments.

Year ended December 31,

C&W Caribbean and Networks 41.8 40.4

C&W Panama 35.4 39.1

Liberty Puerto Rico 44.4 49.3

VTR 37.9 40.6

Costa Rica 39.2 39.1

Adjusted OIBDA margin is impacted by organic changes in revenue, programming and other direct costs of services and other operating costs and expenses, as further discussed below, which include the impacts relating to COVID-19.

The organic change in Adjusted OIBDA for the VTR segment, was negatively impacted by $21 million from foreign currency impact of contracts denominated in U.S.

dollars during the year ended December 31, 2020, of which $15 million related to programming and the remaining in various other cost categories.

The significant decrease in the Adjusted OIBDA margin for Liberty Puerto Rico is primarily related to lower Adjusted OIBDA margins associated with the new mobile operations following the closing of the AT&T Acquisition.

The following table sets forth the changes in revenue by reportable segment.

Increase (decrease) from:

Year ended December 31, Increase (decrease) FX Acquisitions (disposition), net Organic

C&W Caribbean and Networks $ 1,706.8 $ 1,812.8 $ (106.0) $ (33.7) $ (14.1) $ (58.2)

C&W Panama 500.2 582.7 (82.5) — — (82.5)

Liberty Puerto Rico 624.1 412.1 212.0 — 174.2 37.8

VTR 809.0 941.1 (132.1) (103.5) — (28.6)

Costa Rica 140.0 132.7 7.3 0.2 — 7.1

Corporate (a) 2.7 — 2.7 — — 2.7

Intersegment eliminations (18.2) (14.4) (3.8) — — (3.8)

Total $ 3,764.6 $ 3,867.0 $ (102.4) $ (137.0) $ 160.1 $ (125.5)

(a) Amounts relate to services we provide for mobile handset insurance following the closing of the AT&T Acquisition.

C&W Caribbean and Networks.

C&W Caribbean and Networks’s revenue by major category is set forth below.

Year ended December 31, Increase (decrease)

2020 2019 $ %

in millions, except percentages

Residential revenue:

Residential fixed revenue:

Subscription revenue:

Video $ 142.4 $ 150.1 $ (7.7) (5)

Broadband internet 250.0 225.1 24.9 11

Fixed-line telephony 74.6 79.5 (4.9) (6)

Total subscription revenue 467.0 454.7 12.3 3

Non-subscription revenue 42.2 47.5 (5.3) (11)

Total residential fixed revenue 509.2 502.2 7.0 1

Residential mobile revenue:

Service revenue 294.1 339.1 (45.0) (13)

Interconnect, inbound roaming, equipment sales and other (a) 44.4 65.3 (20.9) (32)

Total residential mobile revenue 338.5 404.4 (65.9) (16)

Total residential revenue 847.7 906.6 (58.9) (6)

Service revenue 600.4 659.3 (58.9) (9)

Subsea network revenue 258.7 246.9 11.8 5

Total B2B revenue 859.1 906.2 (47.1) (5)

Total $ 1,706.8 $ 1,812.8 $ (106.0) (6)

(a) Revenue from inbound roaming was $14 million and $34 million, respectively.

The details of the changes in C&W Caribbean and Networks’s revenue during 2020, as compared to 2019, are set forth below (in millions).

Increase (decrease) in residential fixed subscription revenue due to change in:

Average number of RGUs (a) $ 27.7

ARPU (b) (10.9)

Decrease in residential fixed non-subscription revenue (c) (3.4)

Total increase in residential fixed revenue 13.4

Decrease in residential mobile service revenue (d) (29.2)

Decrease in residential mobile interconnect, inbound roaming, equipment sales and other (e) (20.9)

Decrease in B2B service revenue (f) (38.0)

Increase in B2B subsea network revenue (g) 16.5

Total organic decrease (58.2)

Net impact of an acquisition and a disposal (14.1)

Impact of FX (33.7)

Total $ (106.0)

(a) The increase is attributable to higher average broadband internet and video RGUs.

The increase in broadband internet RGUs is partially attributable to an increase in telecommuting during COVID-19 due to work-from-home mandates.

(b) The decrease is primarily due to the net effect of (i) lower ARPU from video and fixed-line telephony services and (ii) higher ARPU from broadband internet services.

(d) The decrease is primarily attributable to (i) lower ARPU from mobile services, as COVID-19 lockdowns and travel restrictions reduced (a) demand for mobile data services and (b) outbound roaming activity, and (ii) lower average prepaid mobile subscribers, primarily due to declines in the Bahamas, as a result of COVID-19 impacts.

(e) The decrease is primarily attributable to an organic decrease of $18 million in inbound roaming fees, primarily related to travel restrictions associated with COVID-19.

(f) The decrease is primarily due to (i) lower revenues from mobile and fixed services partially due to discounts and credits related to reduced or suspended service across our markets as a result of the COVID-19 lockdowns and (ii) lower wholesale interconnect revenues.

(g) The increase is primarily attributable to (i) an increase associated with revenue recognized on a cash basis for services provided to a significant customer and (ii) an increase in the demand for telecommunications capacity on our subsea network during COVID-19.

C&W Panama’s revenue by major category is set forth below.

Year ended December 31, Increase (decrease)

2020 2019 $ %

in millions, except percentages

Residential revenue:

Residential fixed revenue:

Subscription revenue:

Video $ 27.8 $ 31.0 $ (3.2) (10)

Broadband internet 39.0 34.9 4.1 12

Fixed-line telephony 18.8 22.4 (3.6) (16)

Total subscription revenue 85.6 88.3 (2.7) (3)

Non-subscription revenue 11.8 14.5 (2.7) (19)

Total residential fixed revenue 97.4 102.8 (5.4) (5)

Residential mobile revenue:

Service revenue 160.1 183.8 (23.7) (13)

Interconnect, inbound roaming, equipment sales and other (a) 41.0 56.8 (15.8) (28)

Total residential mobile revenue 201.1 240.6 (39.5) (16)

Total residential revenue 298.5 343.4 (44.9) (13)

B2B service revenue 201.7 239.3 (37.6) (16)

Total $ 500.2 $ 582.7 $ (82.5) (14)

(a) Revenue from inbound roaming was $2 million and $3 million, respectively.

The details of the changes in C&W Panama’s revenue during 2020, as compared to 2019, are set forth below (in millions).

Increase (decrease) in residential fixed subscription revenue due to change in:

Average number of RGUs (a) $ 8.4

ARPU (b) (11.1)

Decrease in residential fixed non-subscription revenue (c) (2.7)

Total decrease in residential fixed revenue (5.4)

Decrease in residential mobile service revenue (d) (23.7)

Decrease in residential mobile interconnect, inbound roaming, equipment sales and other revenue (e) (15.8)

Decrease in B2B service revenue (f) (37.6)

Total organic decrease $ (82.5)

(a) The increase is primarily attributable to higher average broadband internet RGUs, partially attributable to an increase in telecommuting during COVID-19 due to work-from-home mandates.

(b) The decrease is primarily due to lower ARPU from fixed-line telephony and video services.

(d) The decrease is primarily attributable to (i) lower ARPU from mobile services , as COVID-19 lockdowns and travel restrictions negatively impacted customers’ ability to recharge handset devices, and (ii) lower average mobile subscribers, primarily resulting from the impacts of COVID-19 and competition.

(e) The decrease is primarily attributable to (i) lower volumes of handset sales, as COVID-19 related lockdowns negatively impacted customers’ ability to purchase handsets and (ii) lower interconnect volumes.

(f) The decrease is primarily due to (i) lower revenues from managed services, primarily driven by certain non-recurring projects that have been put on hold due to the economic uncertainty of the impact of COVID-19, (ii) lower revenues from mobile and fixed services partially due to discounts and credits related to reduced or suspended service as a result of the COVID-19 lockdowns.

Liberty Puerto Rico.

Liberty Puerto Rico’s revenue by major category is set forth below.

Year ended December 31, Increase (decrease)

2020 2019 $ %

in millions, except percentages

Residential fixed revenue:

Subscription revenue:

Video $ 147.2 $ 140.9 $ 6.3 4

Broadband internet 204.7 175.0 29.7 17

Fixed-line telephony 25.5 23.4 2.1 9

Total subscription revenue 377.4 339.3 38.1 11

Non-subscription revenue 17.7 21.7 (4.0) (18)

Total residential fixed revenue 395.1 361.0 34.1 9

Residential mobile revenue:

Service revenue 82.9 — 82.9 N.M.

Interconnect, inbound roaming, equipment sales and other (a) 50.6 — 50.6 N.M.

Total residential mobile revenue 133.5 — 133.5 N.M.

Total residential revenue 528.6 361.0 167.6 46

B2B service revenue 89.8 51.1 38.7 76

Other revenue (b) 5.7 — 5.7 N.M.

Total $ 624.1 $ 412.1 $ 212.0 51

— Not Meaningful.

(a) Revenue from inbound roaming was $11 million in 2020.

(b) Amount relates to funds received from the FCC related to Liberty Mobile following the closing of the AT&T Acquisition.

The details of the changes in Liberty Puerto Rico’s revenue during the year ended December 31, 2020, as compared to 2019, are set forth below (in millions).

Increase in residential fixed subscription revenue due to change in:

Average number of RGUs (a) $ 33.2

Decrease in residential fixed non-subscription revenue (c) (4.0)

Total increase in residential fixed revenue

Increase in B2B service (d)

Total organic increase 37.8

Impact of an acquisition 174.2

Total $ 212.0

(a) The increase is primarily attributable to higher average broadband internet RGUs, as we experienced increased demand due in part to the impact of COVID-19 work-from-home mandates.

(b) The increase is primarily attributable to the net effect of (i) higher ARPU from broadband internet and video services and (ii) a decrease resulting from credits issued to customers in connection with the earthquakes that impacted Puerto Rico in January 2020.

(c) The decrease is primarily due to reconnect and late fee revenues, as such fees were generally waived during the second and third quarters in response to impacts of COVID-19.

(d) The increase primarily relates to the transfer of certain B2B operations in Puerto Rico from our C&W Caribbean and Networks segment to our Liberty Puerto Rico segment.

VTR’s revenue by major category is set forth below.

Year ended December 31, Increase (decrease)

2020 2019 $ %

in millions, except percentages

Residential revenue:

Residential fixed revenue:

Subscription revenue:

Video $ 291.5 $ 346.4 $ (54.9) (16)

Broadband internet 331.3 366.7 (35.4) (10)

Fixed-line telephony 73.5 98.2 (24.7) (25)

Total subscription revenue 696.3 811.3 (115.0) (14)

Non-subscription revenue 18.5 25.1 (6.6) (26)

Total residential fixed revenue 714.8 836.4 (121.6) (15)

Residential mobile revenue:

Service revenue 55.7 62.7 (7.0) (11)

Interconnect, inbound roaming, equipment sales and other 8.2 12.0 (3.8) (32)

Total residential mobile revenue 63.9 74.7 (10.8) (14)

Total residential revenue 778.7 911.1 (132.4) (15)

B2B service revenue 30.3 30.0 0.3 1

Total $ 809.0 $ 941.1 $ (132.1) (14)

The details of the changes in VTR’s revenue during 2020, as compared to 2019, are set forth below (in millions).

Decrease in residential fixed subscription revenue due to change in:

Average number of RGUs (a) $ (4.4)

ARPU (b) (21.7)

Decrease in residential fixed non-subscription revenue (c) (4.2)

Total decrease in residential fixed revenue (30.3)

Increase in residential mobile service revenue (d) 0.3

Decrease in residential mobile interconnect, inbound roaming, equipment sales and other revenue (e) (2.8)

Increase in B2B service revenue (f) 4.2

Total organic decrease (28.6)

Impact of FX (103.5)

Total $ (132.1)

(a) The increase is primarily attributable to the net effect of (i) higher average broadband internet RGUs, partially attributable to an increase in telecommuting during COVID-19 due to work-from-home mandates, and (ii) lower average fixed-line telephony RGUs at VTR.

(b) The decrease is primarily due to lower ARPU from (i) video, primarily attributable to declines associated with the cancellation of live soccer matches broadcast on our premium programming, and (ii) fixed-line telephony.

(d) The increase is due to the net effect of (i) higher average numbers of mobile subscribers and (ii) lower ARPU from mobile services.

(e) The decrease is primarily attributable to declines in (i) interconnect revenue due to decreased rates, partially offset by higher traffic, and (ii) handset sales due to the temporary closure of physical stores, as a result of COVID-19-related lockdowns.

(f) The increase is largely attributable to higher broadband internet and fixed-line telephony services.

Costa Rica’s revenue by major category is set forth below.

Year ended December 31, Increase (decrease)

2020 2019 $ %

in millions, except percentages

Residential revenue:

Residential fixed revenue:

Subscription revenue:

Video $ 79.1 $ 75.7 $ 3.4 4

Broadband internet 51.4 45.3 6.1 13

Fixed-line telephony 3.7 2.5 1.2 48

Total subscription revenue 134.2 123.5 10.7 9

Non-subscription revenue 5.8 9.2 (3.4) (37)

Total $ 140.0 $ 132.7 $ 7.3 6

The details of the changes in Costa Rica’s revenue during 2020, as compared to 2019, are set forth below (in millions):

Increase in residential fixed subscription revenue due to change in:

Average number of RGUs (a) $ 9.9

Decrease in residential fixed non-subscription revenue (c) (3.4)

Total organic increase 7.1

Impact of FX 0.2

(a) The increase is primarily attributable to higher average (i) broadband internet RGUs, partially attributable to an increase in telecommuting during COVID-19 due to work-from-home mandates, and (ii) video RGUs.

(b) The increase is due to higher ARPU from video services.

Programming and other direct costs of services

The following table sets forth the changes in programming and other direct costs of services on a consolidated basis.

Increase (decrease) from:

Year ended December 31, Increase (decrease) Acquisition (disposition), net Organic

Programming and copyright $ 389.3 $ 404.8 $ (15.5) $ (21.5) $ (0.9) $ 6.9

Interconnect 257.6 280.0 (22.4) (12.2) 11.1 (21.3)

Equipment and other 199.1 193.0 6.1 (2.8) 47.6 (38.7)

Total programming and other direct costs of services $ 846.0 $ 877.8 $ (31.8) $ (36.5) $ 57.8 $ (53.1)

C&W Caribbean and Networks.

The following table sets forth the changes in programming and other direct costs of services for our C&W Caribbean and Networks segment.

Decrease from:

Year ended December 31, Decrease FX Acquisition (disposition), net Organic

Programming and copyright $ 88.8 $ 105.3 $ (16.5) $ (1.3) $ (2.8) $ (12.4)

Interconnect 163.0 174.4 (11.4) (6.8) (2.6) (2.0)

Equipment and other 59.1 75.0 (15.9) (0.9) (2.2) (12.8)

Total programming and other direct costs of services $ 310.9 $ 354.7 $ (43.8) $ (9.0) $ (7.6) $ (27.2)

• Programming and copyright:

The organic decrease is primarily due to the net effect of (i) lower sports content costs and (ii) the net negative impact resulting from the reassessment and release of various accruals in certain of our markets during 2020 and 2019.

• Interconnect and commissions:

The organic decrease is primarily due to the net effect of (i) lower wholesale call volumes and (ii) the negative impact resulting from the reassessment of an accrual during 2019.

• Equipment and other:

The organic decrease is primarily due to lower volume of mobile handset sales.

The following table sets forth the changes in programming and other direct costs of services for our C&W Panama segment.

Year ended December 31, Organic decrease

Programming and copyright $ 13.9 $ 14.6 $ (0.7)

Interconnect 41.1 52.0 (10.9)

Equipment and other 74.0 91.1 (17.1)

Total programming and other direct costs of services $ 129.0 $ 157.7 $ (28.7)

• Interconnect and commissions:

The organic decrease is primarily due to lower wholesale call volumes.

• Equipment and other:

The organic decrease is primarily due to (i) lower volume of mobile handset sales and (ii) a decrease driven by certain non-recurring projects that have been put on hold due to the economic uncertainty of the impact of COVID-19.

Liberty Puerto Rico.

The following table sets forth the changes in programming and other direct costs of services for our Liberty Puerto Rico segment.

Increase from:

Year ended December 31,

2020 2019 Increase Acquisition Organic

Programming and copyright $ 91.9 $ 85.0 $ 6.9 $ 1.9 $ 5.0

Interconnect 21.9 7.5 14.4 13.7 0.7

Equipment and other 50.5 0.3 50.2 49.8 0.4

Total programming and other direct costs of services $ 164.3 $ 92.8 $ 71.5 $ 65.4 $ 6.1

• Programming and copyright:

The organic increase is primarily due to (i) a higher average number of video subscribers, (ii) an accrual recorded in the second quarter of 2020 related to an audit of programming services provided in 2018 and 2019 and (iii) higher programming rates.

• Interconnect and commissions:

The organic increase is primarily due to the transfer of certain B2B operations in Puerto Rico from our C&W Caribbean and Networks segment to our Liberty Puerto Rico segment during the first quarter of 2019.

The following table sets forth the changes in programming and other direct costs of services for our VTR segment.

Year ended December 31, Decrease Increase (decrease) from:

2020 2019 FX Organic

Programming and copyright $ 163.2 $ 170.9 $ (7.7) $ (20.3) $ 12.6

Interconnect 39.2 52.3 (13.1) (5.4) (7.7)

Equipment and other 16.5 24.8 (8.3) (1.9) (6.4)

Total programming and other direct costs of services $ 218.9 $ 248.0 $ (29.1) $ (27.6) $ (1.5)

• Programming and copyright:

The organic increase is primarily due to the net effect of (i) an increase of $15 million in the foreign currency impact of programming contracts denominated in U.S.

dollars, and (ii) a net decrease in certain premium and basic content costs, primarily due to (a) a decline associated with the renegotiation of a programming contract that governs content rates for live soccer matches that were cancelled, (b) an increase in rates in other premium and basic content cost and (c) lower subscribers of other premium and basic content.

• Interconnect and commissions:

The organic decrease is primarily due to lower rates that were partially offset by higher volumes.

• Equipment and other:

The organic decrease is primarily due to the net effect of (i) lower volumes of equipment sales as a result of changes in market dynamics and customer usage due to COVID-19-related restrictions and (ii) an increase of $3 million in the foreign currency impact on costs of handsets sales.

The following table sets forth the changes in programming and other direct costs of services for our Costa Rica segment.

Year ended December 31, Increase (decrease) Increase (decrease) from:

2020 2019 FX Organic

Programming and copyright $ 31.5 $ 29.0 $ 2.5 $ 0.1 $ 2.4

Interconnect 5.8 5.1 0.7 — 0.7

Equipment and other 1.7 3.3 (1.6) — (1.6)

Total programming and other direct costs of services $ 39.0 $ 37.4 $ 1.6 $ 0.1 $ 1.5

• Programming and copyright:

The organic increase is primarily due to higher sports content costs and higher subscribers of other premium and basic content.

• Equipment and other:

The organic decrease is primarily due to lower equipment sales.

Other operating costs and expenses

The following table sets forth the changes in other operating costs and expenses on a consolidated basis.

Increase (decrease) from:

Year ended December 31, Increase (decrease) Acquisition (disposition), net Organic

Personnel and contract labor $ 483.6 $ 500.4 $ (16.8) $ (13.0) $ 14.1 $ (17.9)

Network-related 261.4 264.4 (3.0) (11.4) 1.1 7.3

Service-related 161.7 149.9 11.8 (5.0) 9.7 7.1

Commercial 168.1 172.6 (4.5) (11.2) 5.4 1.3

Facility, provision, franchise and other 359.1 360.5 (1.4) (8.4) 22.4 (15.4)

Share-based compensation expense 97.5 57.5 40.0 (1.0) 0.8 40.2

Total other operating costs and expenses $ 1,531.4 $ 1,505.3 $ 26.1 $ (50.0) $ 53.5 $ 22.6

C&W Caribbean and Networks.

The following table sets forth the changes in other operating costs and expenses for our C&W Caribbean and Networks segment.

Increase (decrease) from:

Year ended December 31, Increase (decrease) Acquisition (disposition), net Organic

Personnel and contract labor $ 254.2 $ 270.6 $ (16.4) $ (5.1) $ 0.6 $ (11.9)

Network-related 140.5 147.3 (6.8) (3.2) (1.4) (2.2)

Service-related 70.6 70.6 — (0.6) 1.8 (1.2)

Commercial 45.4 57.4 (12.0) (1.2) (0.3) (10.5)

Facility, provision, franchise and other 171.9 180.0 (8.1) (2.8) (0.8) (4.5)

Share-based compensation expense 28.4 16.5 11.9 (0.1) 0.8 11.2

Total other operating costs and expenses $ 711.0 $ 742.4 $ (31.4) $ (13.0) $ 0.7 $ (19.1)

• Personnel and contract labor:

The organic decrease is primarily due to the net effect of (i) lower salaries and other personnel costs, primarily associated with the benefit of certain ongoing restructuring activities, (ii) estimated bonus-related expenses that have been recognized as share-based compensation expense, as certain 2020 bonuses were paid in the form of equity, as further discussed below under S hare-based compensation expense , and (iii) lower capitalized labor costs due to the curtailment of certain projects as a result of the impact of COVID-19.

• Commercial:

The organic decrease is primarily due to lower marketing and sales costs, largely due to reductions in promotional and sponsorship costs, as a result of certain adverse economic impacts caused by the COVID-19 pandemic across our markets.

• Facility, provision, franchise and other costs:

The organic decrease is primarily due to the net effect of:

◦ lower (i) travel and entertainment costs and (ii) office-related expenses due to the curtailment of such costs as a result of the impact of COVID-19;

◦ an increase due to the negative impact of a decline in 2019 associated with withholding taxes on third-party supplier services, primarily related to the expiration of statute of limitations;

◦ lower insurance costs due in part to our Weather Derivative, as further described below and in notes 3 and 5 to our consolidated financial statements;

◦ bad debt expense, which remained relatively unchanged, as (i) higher bad debt provisions due to the impacts of COVID-19, which during 2020 generally resulted in (a) delays in collections, (b) higher expected credit losses associated with certain B2B customers and (c) changes in our general expectations related to our customers’ ability to pay, were offset by (ii) the beneficial impacts of (a) a provision in 2019 related to certain B2B customers and (b) a provision in 2019 related to the impact of Hurricane Dorian.

The following table sets forth the changes in other operating costs and expenses for our C&W Panama segment.

Year ended December 31, Organic increase (decrease)

Personnel and contract labor $ 70.9 $ 70.2 $ 0.7

Network-related 39.7 43.0 (3.3)

Service-related 13.3 15.8 (2.5)

Commercial 20.5 22.0 (1.5)

Facility, provision, franchise and other 49.6 46.4 3.2

Share-based compensation expense 2.7 0.9 1.8

Total other operating costs and expenses $ 196.7 $ 198.3 $ (1.6)

• Personnel and contract labor:

The organic increase is net of the impact of estimated bonus-related expense that has been recognized as share-based compensation expense, as certain 2020 bonuses were paid in the form of equity, as further discussed below under S hare-based compensation expense.

• Facility, provision, franchise and other costs:

The organic increase is primarily due to the net effect of (i) higher bad debt provisions during 2020, as the impacts of COVID-19 have generally resulted in (a) delays in collections, (b) higher expected credit losses associated with certain B2B customers and (c) changes in our general expectations related to our customers’ ability to pay, and (ii) the beneficial impact of an increase to the bad debt provision during 2019, primarily related to certain government customers.

Liberty Puerto Rico.

The following table sets forth the changes in other operating costs and expenses for our Liberty Puerto Rico segment.

Year ended December 31, Increase (decrease) from:

2020 2019 Increase Acquisition Organic

Personnel and contract labor $ 62.1 $ 39.5 $ 22.6 $ 13.5 $ 9.1

Network-related 6.7 4.5 2.2 2.5 (0.3)

Service-related 24.9 10.6 14.3 7.9 6.4

Commercial 19.0 10.9 8.1 5.7 2.4

Facility, provision, franchise and other 70.2 50.6 19.6 23.2 (3.6)

Share-based compensation expense 5.1 2.2 2.9 — 2.9

Total other operating costs and expenses $ 188.0 $ 118.3 $ 69.7 $ 52.8 $ 16.9

• Personnel and contract labor:

The organic increase is primarily due to the net effect of (i) annual salary increases, (ii) higher sales commissions and (iii) estimated bonus-related expense that has been recognized as share-based compensation expense, as certain 2020 bonuses were paid in the form of equity, as further discussed below under Share-based compensation expense.

• Service-related:

The organic increase is primarily due to integration costs of $6 million associated with the AT&T Acquisition.

• Facility, provision, franchise and other:

The organic decrease is primarily due to lower bad debt expense driven by improved collections.

The following table sets forth the changes in other operating costs and expenses for our VTR segment.

Year ended December 31, Increase (decrease) Increase (decrease) from:

2020 2019 FX Organic

Personnel and contract labor $ 61.1 $ 75.7 $ (14.6) $ (8.0) $ (6.6)

Network-related 67.2 63.2 4.0 (8.2) 12.2

Service-related 36.4 38.3 (1.9) (4.4) 2.5

Commercial 76.2 79.0 (2.8) (10.0) 7.2

Facility, provision, franchise and other 42.2 55.2 (13.0) (5.6) (7.4)

Share-based compensation expense 8.2 4.8 3.4 (0.9) 4.3

Total other operating costs and expenses $ 291.3 $ 316.2 $ (24.9) $ (37.1) $ 12.2

• Personnel and contract labor:

The organic decrease is primarily due to (i) a decrease in salary-related costs, which includes estimated bonus-related expense that has been recognized as share-based compensation expense, as certain 2020 bonuses were paid in the form of equity, as further discussed below under Share-based compensation expense , and (ii) higher capitalized labor costs associated with certain development-related projects.

• Network-related:

The organic increase is primarily due to (i) higher volumes of network access-related contracted labor and (ii) higher costs related to CPE refurbishment activity.

• Service-related:

The organic increase is primarily due to (i) higher professional consultancy services and (ii) increased information technology costs associated with software maintenance and support.

• Commercial:

The organic increase is primarily due to the net effect of (i) an increase in call center volumes as a result of the impact from COVID-19, (ii) a decrease in marketing and advertising expenses and (iii) higher sales commissions to third-party dealers.

• Facility, provision, franchise and other costs:

The organic decrease is primarily due to lower (i) travel and entertainment costs due to curtailment of such costs as a result of the impact of COVID-19, (ii) bad debt and collection expenses, (iii) facilities-related expenses and (iv) bank-related fees.

The following table sets forth the changes in other operating costs and expenses for our Costa Rica segment.

Year ended December 31, Increase (decrease) Increase (decrease) from:

2020 2019 FX Organic

Personnel and contract labor $ 15.0 $ 15.8 $ (0.8) $ 0.1 $ (0.9)

Network-related 8.6 7.9 0.7 — 0.7

Service-related 2.0 1.6 0.4 — 0.4

Commercial 7.0 3.3 3.7 — 3.7

Facility, provision, franchise and other 13.5 14.8 (1.3) — (1.3)

Share-based compensation expense 0.7 0.1 0.6 — 0.6

Total other operating costs and expenses $ 46.8 $ 43.5 $ 3.3 $ 0.1 $ 3.2

• Commercial:

The organic increase is primarily due to (i) higher sales commissions to third-party dealers and (ii) an increase in call center volumes as a result of the impact from COVID-19.

• Facility, provision, franchise and other costs:

The organic decrease is primarily due to lower bank-related fees.

The following tables set forth the changes in other operating costs and expenses for our corporate operations.

Year ended December 31, Organic increase (decrease)

Personnel and contract labor $ 20.3 $ 28.6 $ (8.3)

Network-related 1.1 — 1.1

Service-related 14.5 13.0 1.5

Facility, provision, franchise and other 11.7 13.5 (1.8)

Share-based compensation expense 52.4 33.0 19.4

Total other operating costs and expenses $ 100.0 $ 88.1 $ 11.9

• Personnel and contract labor:

The organic decrease is primarily attributable to estimated bonus-related expense that has been recognized as share-based compensation expense, as certain 2020 bonuses were paid in the form of equity, as further discussed below under Share-based compensation expense .

• Facility, provision, franchise and other:

The organic decrease is primarily attributable to the net effect of (i) lower travel and entertainment costs due to curtailment of such costs as a result of the impact of COVID-19 and (ii) higher expenses associated with a mobile handset insurance program that began during the fourth quarter of 2020 following the closing of the AT&T Acquisition.

Results of operations (below Adjusted OIBDA)—2020 compared to 2019

Share-based compensation expense (included in other operating costs and expenses)

Share-based compensation expense increased $40 million during 2020, as compared to 2019.

This increase is primarily due to an increase of (i) $19 million related to estimated bonus-related expenses that was paid in the form of equity and (ii) $7 million related to the extension of the expiration period for certain Liberty Global awards held by our employees.

Depreciation and amortization

Our depreciation and amortization expense increased $29 million or 3% during 2020, as compared to 2019.

The increase is primarily due to the net effect of (i) an increase in property and equipment additions, primarily associated with the installation of CPE, baseline additions, support-related equipment expenditures and the expansion and upgrade of our networks and other capital initiatives, and (ii) a decrease associated with certain assets becoming fully depreciated.

Impairment, restructuring and other operating items, net

Year ended December 31,

Impairment charges (a) $ 277.7 $ 204.8

Restructuring charges (b) 27.5 45.7

Other operating items, net (c) 70.1 17.7

Total $ 375.3 $ 268.2

(a) The 2020 amount primarily includes goodwill impairment charges of $174 million at C&W Panama and $99 million at various reporting units within the C&W Caribbean and Networks segment mostly related to the economic impacts associated with COVID-19.

The 2019 amount primarily includes (i) $185 million related to an impairment of goodwill at C&W Panama and (ii) $17 million related to charges at C&W Caribbean and Networks primarily to reduce the carrying value of property and equipment as a result of the impact of Hurricane Dorian.

The 2019 amounts primarily include direct acquisition costs and disposition costs relate to the AT&T Acquisition and, to a lesser extent, the UTS Acquisition.

Interest expense

Our interest expense increased $34 million during 2020, as compared to 2019.

The increase is primarily due to (i) the net effect of (a) higher average outstanding debt balances and (b) lower weighted-average interest rates and (ii) higher amortization of (a) discounts and premiums, net, and (b) deferred financing costs.

Realized and unrealized gains or losses on derivative instruments, net

The details of our realized and unrealized losses on derivative instruments, net, are as follows:

Year ended December 31,

Cross-currency and interest rate derivative contracts (a) (b) $ (328.6) $ (21.0)

Foreign currency forward contracts (7.8) 9.4

Weather Derivatives (c) (16.3) (5.6)

Total $ (352.7) $ (17.2)

(a) The loss during 2020 includes a realized gain of $71 million associated with the settlement of certain cross-currency swaps at VTR in June 2020 that were unwound in connection with the July 2020 refinancing of certain VTR debt.

For additional information regarding the refinancing, see note 10 to our consolidated financial statements.

(b) The loss during 2020 is primarily attributable to the net effect of (i) changes in interest rates and (ii) changes in FX rates, predominantly due to changes in the value of the Chilean peso relative to the U.S.

In addition, the loss during 2020 includes a net gain of $47 million resulting from changes in our credit risk valuation adjustments, which are primarily due to increased credit risk stemming from market reaction to the COVID-19 outbreak.

The loss during 2019 is primarily attributable to (i) changes in interest rates and (ii) changes in FX rates, predominantly due to changes in the value of the Chilean peso relative to the U.S.

In addition, the loss during 2019 includes a net gain of $4 million resulting from changes in our credit risk valuation adjustments.

Foreign currency transaction gains or losses, net

The details of our foreign currency transaction gains (losses), net, are as follows:

Year ended December 31,

dollar-denominated debt issued by a Chilean peso functional currency entity $ 61.7 $ (98.4)

Intercompany payables and receivables denominated in a currency other than the entity’s functional currency (53.2) (10.0)

British pound sterling-denominated debt issued by a U.S.

dollar functional currency entity — (3.7)

Other (7.3) (0.4)

Total $ 1.2 $ (112.5)

Gains or losses on debt modification and extinguishment, net

We recognized losses on debt modification and extinguishment, net, of $45 million and $20 million during 2020 and 2019, respectively.

The loss during 2019 primarily includes the payment of redemption premiums.

Other income or expense, net

We recognized other income of $5 million and $14 million during 2020 and 2019, respectively.

The amount during 2020 primarily relates to the net effect of (i) interest income, including interest we generated on restricted cash held in escrow in advance of the closing of the AT&T Acquisition, and (ii) other individually insignificant expenses.

The amount during 2019 primarily relates to interest income.

Income tax benefit or expense

We recognized income tax benefit of $28 million and $100 million during 2020 and 2019, respectively.

The income tax expense attributable to our loss before income taxes during 2019 differs from the amounts computed using the statutory tax rate (based on the Bermuda statutory tax rate of 0%), primarily due to the beneficial effects of (i) net favorable changes in uncertain tax positions, (ii) international rate differences, (iii) basis adjustments associated with investments in Liberty Latin America entities and (iv) enacted tax rate changes, which are offset by the detrimental effects of (i) increases in valuation allowances, (ii) non-deductible goodwill impairments and (iii) net unfavorable permanent difference.

Net earnings or loss

The following table sets forth selected summary financial information of our net loss for the periods indicated:

Year ended December 31,

Operating income $ 93.2 $ 325.8

Net non-operating expenses $ (924.9) $ (634.4)

Income tax benefit $ 27.8 $ 100.2

Net loss $ (803.9) $ (208.4)

Net earnings or loss attributable to noncontrolling interests

We reported net losses attributable to noncontrolling interests of $122 million and $102 million during 2020 and 2019, respectively.

Liquidity and Capital Resources

Sources and Uses of Cash

As of December 31, 2021, we have four primary “borrowing groups,” which include the respective restricted parent and subsidiary entities of C&W, Liberty Puerto Rico, VTR and Costa Rica.

As of December 31, 2022, we have three primary “borrowing groups,” which include the respective restricted parent and subsidiary entities of C&W, Liberty Puerto Rico and Liberty Costa Rica.

Our borrowing groups, which typically generate cash from operating activities, held a significant portion of our consolidated cash and cash equivalents at December 31, 2022.

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Borrowing groups (c):

C&W (d) 536.2

Liberty Puerto Rico 72.3

Costa Rica 24.2

Liberty Costa Rica 16.0

Total borrowing groups 624.5

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(c) Represents the aggregate amounts held by the parent entity of the applicable borrowing group and their restricted subsidiaries.

(d) Represents current excess cash of VTR retained by Liberty Latin America.

Cash of $110 million associated with the Chile JV Entities has been reflected in assets held for sale on our December 31, 2021 consolidated balance sheet.

(d) Includes $89 million and $51 million of cash held by operations in C&W Panama and C&W Bahamas, respectively.

Liquidity and capital resources of Liberty Latin America and its unrestricted subsidiaries

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In addition, Liberty Latin America and its unrestricted subsidiaries may require cash in connection with (i) the repayment of third-party and intercompany debt, (ii) the satisfaction of contingent liabilities, (iii) acquisitions and other investment opportunities, (iv) the repurchase of debt securities, (v) tax payments or (vi) any funding requirements of our consolidated subsidiaries.

In March 2020, our Directors approved the Share Repurchase Program.

During 2022, the aggregate value of our share repurchases was $169 million.

For additional information regarding our Share Repurchase Program, see note 19 to our consolidated financial statements and above Part II—Item 5.

For additional information regarding our Share Repurchase Programs, see note 17 to our consolidated financial statements and above Part II—Item 5.

Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities .

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For the details of the borrowing availability of our borrowing groups at December 31, 2022, see note 9 to our consolidated financial statements.

The aforementioned sources of liquidity may be supplemented in certain cases by contributions and/or loans from Liberty Latin America and its unrestricted subsidiaries.

The aforementioned sources of liquidity may be

supplemented in certain cases by contributions and/or loans from Liberty Latin America and its unrestricted subsidiaries.

The liquidity of our borrowing groups generally is used to fund capital expenditures, debt service requirements and income tax payments.

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As further discussed under Item 7A.

Qualitative and Quantitative Disclosures about Market Risk and in note 5 to our consolidated financial statements, we also use derivative instruments to mitigate foreign currency and interest rate risks associated with our debt instruments.

Our ability to service or refinance our debt and to maintain compliance with the leverage covenants in the credit agreements of our borrowing groups is dependent primarily on our ability to maintain covenant EBITDA of our operating subsidiaries, as specified by our subsidiaries’ debt agreements ( Covenant EBITDA ), and to achieve adequate returns on our property and equipment additions and acquisitions.

In addition, our ability to obtain additional debt financing is limited by incurrence-based leverage covenants contained in the various debt instruments of our borrowing groups.

Quantitative and Qualitative Disclosures about Market Risk and in note 5 to our consolidated financial statements, we also use derivative instruments to mitigate foreign currency and interest rate risks associated with our debt instruments.

Our ability to service or refinance our debt and, where applicable, to maintain compliance with the leverage covenants in the credit agreements of our borrowing groups is dependent primarily on our ability to maintain covenant EBITDA of our operating subsidiaries, as specified by our subsidiaries’ debt agreements ( Covenant EBITDA ), and to achieve adequate returns on our property and equipment additions and acquisitions.

In addition, our ability to obtain additional debt financing is limited by incurrence-based and/or maintenance-based leverage covenants contained in the various debt instruments of our borrowing groups.

For example, if the Covenant EBITDA of one of our borrowing groups were to decline, our ability to support or obtain additional debt in that borrowing group could be limited.

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We do not anticipate any instances of non-compliance with respect to the debt covenants of our borrowing groups that would have a material adverse impact on our liquidity during the next 12 months.

At December 31, 2021, the outstanding principal amount of our debt, together with our finance lease obligations, excluding VTR, aggregated $7,686 million, including $106 million that is classified as current in our consolidated balance sheet and $6,433 million that is not due until 2027 or thereafter.

At December 31, 2022, the outstanding principal amount of our debt, together with our finance lease obligations aggregated $7,975 million, including $227 million that is classified as current in our consolidated balance sheet and $6,868 million that is not due until 2027 or thereafter.

At December 31, 2022, $7,571 million of our debt and finance lease obligations have been borrowed or incurred by our subsidiaries.

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The weighted average impact of the derivative instruments, excluding forward-starting derivative instruments, on our borrowing costs at December 31, 2022 was as follows:

Borrowing group Increase to borrowing costs

Borrowing group Decrease to borrowing costs

Liberty Puerto Rico (0.49) %

Costa Rica 0.40 %

Liberty Costa Rica (1.57) %

Liberty Latin America borrowing groups (0.98) %

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Net cash used by investing activities (1,122.6) (1,268.6) 146.0

Net cash provided by financing activities 426.6 271.1 155.5

Net cash provided (used) by financing activities (29.2) 426.6 (455.8)

Effect of exchange rate changes on cash, cash equivalents and restricted cash (2.3) (12.5) 10.2

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Operating Activities.

The increase in cash provided by operating activities is primarily due to the net impact of (i) an increase in Adjusted OIBDA, particularly in our Liberty Puerto Rico segment, and related working capital changes, (ii) an increase resulting from $73 million of cash used during 2020 for the purchase of prepaid roaming services in conjunction with the AT&T Acquisition, (iii) a decrease related to derivative payments and (iv) an increase related to a decline in cash paid for taxes.

For additional information regarding cash used for derivative activities, see note 5 to the consolidated financial statements.

For additional information relating to the purchase of prepaid roaming services, see note 4 to our consolidated financial statements.

For additional information regarding our non-GAAP measure of consolidated Adjusted OIBDA, including

a reconciliation to the nearest U.S.

GAAP measure, see Results of Operations—Year ended December 31, 2021 as Compared with Year Ended December 31, 2020—Adjusted OIBDA above.

The decrease in cash provided by operating activities is primarily due to (i) a decrease resulting from an increase in cash paid for taxes and interest, (ii) an increase related to lower derivative-related payments, and (iii) a decrease associated with a decline in Adjusted OIBDA and related working capital change.

Investing Activities.

Our cash used during 2021 primarily includes (i) $736 million related to capital expenditures and (ii) $521 million, primarily related to the Telefónica Costa Rica Acquisition.

Our cash used during 2020 primarily includes (i) $1,886 million, mostly related the AT&T Acquisition, (ii) and $566 million related to capital expenditures.

The capital expenditures that we report in our consolidated statements of cash flows, which includes cash paid for property and equipment and intangible assets that were not acquired in connection with an acquisition, does not include amounts that are financed under capital-related vendor financing or finance lease arrangements.

Our cash used during 2022 primarily includes the net effect of (i) capital expenditures, net, as further discussed below, (ii) the Claro Panama Acquisition and BBVI Acquisition and (iii) cash outflow upon the disposition the Chile JV Entities.

Our cash used during 2021 primarily includes (i) capital expenditures, as further discussed below, and (ii) the Liberty Telecomunicaciones Acquisition.

The capital expenditures, net, that we report in our consolidated statements of cash flows, which relates to cash paid for property and equipment, does not include amounts that are financed under capital-related vendor financing or finance lease arrangements.

Instead, these amounts 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.

In this discussion, we refer to (i) our capital expenditures, as reported in our consolidated statements of cash flows, and (ii) our total property and equipment additions, which include our capital expenditures on an accrual basis and amounts financed under capital-related vendor financing or finance lease arrangements.

A reconciliation of our property and equipment additions to our capital expenditures, as reported in our consolidated statements of cash flows, is set forth below:

In this discussion, we refer to (i) our capital expenditures, net, as reported in our consolidated statements of cash flows, and (ii) our total property and equipment additions, which include our capital expenditures, net, on an accrual basis and amounts financed under capital-related vendor financing or finance lease arrangements.

A reconciliation of our property and equipment additions to our capital expenditures, net, as reported in our consolidated statements of cash flows, is set forth below:

Year ended December 31,

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Assets acquired under capital-related vendor financing arrangements (161.1) (100.5)

Acquisition of intangible assets

Changes in current liabilities related to capital expenditures (19.1) 26.0

Capital expenditures $ 736.3 $ 565.8

The increase in our property and equipment additions during the year ended December 31, 2021, as compared to 2020, is primarily due to increases related to each asset category, in particular assets related to new build and upgrades and capacity additions.

Changes in current liabilities related to capital expenditures and other 4.9 (19.1)

Capital expenditures, net $ 660.1 $ 736.3

The decrease in our property and equipment additions during the year ended December 31, 2022, as compared to 2021, is primarily due to decreases in CPE-related additions and product and enabler additions which were partially offset by baseline additions.

During the year ended December 31, 2022 and 2021, our property and equipment additions represented 17.0% and 17.8% of revenue, respectively.

We expect the percentage of revenue represented by our aggregate 2023 property and equipment additions to be approximately 16%.

The actual amount of the 2022 consolidated property and equipment additions may vary from expected amounts for a variety of reasons, including (i) potential impacts from COVID-19, (ii) changes in (a) the competitive or regulatory environment, (b) business plans, (c) our expected future operating results and (d) foreign currency exchange rates and, (iii) the availability of sufficient capital.

The actual amount of the 2023 consolidated property and equipment additions may vary from expected amounts for a variety of reasons, including (i) changes in (a) the competitive or regulatory environment, (b) business plans, (c) our expected future operating results and (d) foreign currency exchange rates and, (ii) the availability of sufficient capital.

Accordingly, no assurance can be given that our actual property and equipment additions will not vary materially from our expectations.

Financing Activities.

During the year ended December 31, 2021, we generated $427 million of cash from financing activities, primarily due to the net effect of (i) $617 million of net borrowings of debt, (ii) $75 million related to payments of financing costs and debt redemption premiums, (iii) $63 million associated with the repurchase of Liberty Latin America common shares, (iv) $48 million in payments related to distributions to noncontrolling interest owners, primarily in C&W Bahamas and C&W Panama, (v) $47 million related to the contribution from a noncontrolling interest owner, as further described in note 19 of the consolidated financial statements, and (vi) $43 million related to derivative payments.

During 2020, we generated $271 million of cash from financing activities, primarily due to (i) $347 million related to the Rights Offering and (ii) $183 million of net cash related to derivative instruments.

These items were slightly offset by (i) $120 million of net repayments of debt and (ii) $99 million related to payments of financing costs and debt premiums.

The net cash received related to derivative instruments is primarily due to the unwinding of cross-currency swaps held at our VTR borrowing group, as further described in note 5 to the consolidated financial statements.

Consolidated Statements of Cash Flows—2020 compared to 2019

Our 2020 and 2019 consolidated statements of cash flows are summarized as follows:

Year ended December 31,

2020 2019 Change

Net cash provided by operating activities $ 640.1 $ 918.2 $ (278.1)

Net cash used by investing activities (2,450.8) (635.3) (1,815.5)

Net cash provided by financing activities 271.1 1,539.8 (1,268.7)

Effect of exchange rate changes on cash, cash equivalents and restricted cash (4.9) (7.7) 2.8

Net increase (decrease) in cash, cash equivalents and restricted cash $ (1,544.5) $ 1,815.0 $ (3,359.5)

Operating Activities.

The decrease in net cash provided by our operating activities is primarily attributable to the net effect of (i) $73 million of cash used for the purchase of prepaid roaming services in conjunction with the AT&T Acquisition, (ii) a decrease of $61 million related to derivative activities, (iii) a decrease from our consolidated Adjusted OIBDA (a non-GAAP measure), (iv) lower tax payments of $49 million, and (v) the negative impact for the comparative period resulting from $33 million of cash received during 2019 associated with the final insurance settlement for hurricanes Irma, Maria, and Matthew that was reflected as an operating cash inflow.

Additionally, the working capital changes in our consolidated statement of cash flows for 2020 and 2019 include the negative impacts of a $33 million and $185 million release of an uncertain tax position liability, respectively, that have been reflected as a tax benefit in our consolidated statements of operations, as further described in note 15 to our consolidated financial statements.

For additional information regarding our non-GAAP measure of consolidated Adjusted OIBDA, including a reconciliation to the nearest U.S.

GAAP measure, see Results of Operations—Year ended December 31, 2020 as Compared with Year Ended December 31, 2019—Adjusted OIBDA above.

Investing Activities.

Our cash used during 2020 primarily includes (i) $1,886 million mostly related the AT&T Acquisition, (ii) and $566 million related to capital expenditures.

Our cash used during 2019 primarily includes (i) $589 million of cash used related to capital expenditures, (ii) $161 million of cash used for the UTS Acquisition in March 2019, (iii) $78 million of net cash received in connection with the Seychelles Disposition, and (iv) $34 million of cash we received during the first quarter of 2019 related to the recovery on damaged or destroyed property and equipment resulting from hurricanes Maria, Irma and Matthew.

For additional information regarding the settlement of our insurance claims associated with these hurricanes, see note 7 to our consolidated financial statements.

See below for additional information relating to cash used for capital expenditures.

A reconciliation of our property and equipment additions to our capital expenditures, as reported in our consolidated statements of cash flows, is set forth below:

Year ended December 31,

Property and equipment additions $ 631.1 $ 721.5

Assets acquired under capital-related vendor financing arrangements (99.1) (96.1)

Acquisition of intangible assets 7.8 —

Assets acquired under finance leases — (0.2)

Changes in current liabilities related to capital expenditures 26.0 (36.1)

Capital expenditures $ 565.8 $ 589.1

The decrease in our property and equipment additions during 2020, as compared to 2019, is primarily due to a decrease in (i) new build & upgrade equipment and (ii) customer premise equipment.

During 2020 and 2019, our property and equipment additions represented 16.8% and 18.7% of revenue, respectively.

Financing Activities.

These items were slightly offset by (i) $120 million of net repayment of debt and (ii) $99 million related to payments of financing costs and debt premiums.

During 2019, we received $1,540 million in net cash from financing activities, primarily due to $1,691 million of net

borrowings of debt, which was slightly offset by $55 million related to payments of financing costs and debt premiums, $46 million of cash used related to the purchase of Capped Calls, and $38 million for the distribution to noncontrolling interest owners, primarily related to Panama operations.

The net borrowings of debt primarily relates to the $1.2 billion principal amount of 2027 LPR Senior Secured Notes issued related to the then pending AT&T Acquisition and the issuance of the Convertible Notes, each as further described in note 10 to our consolidated financial statements.

During the year ended December 31, 2022, we used $29 million of cash from financing activities, primarily due to $170 million associated with the repurchase of Liberty Latin America common shares, partially offset by (i) $98 million of net cash received related to derivative instruments and (ii) $61 million of net borrowings of debt, which include the impact of $48 million of cash used to extinguish debt at VTR.

During 2021, we generated $427 million of cash from financing activities, primarily due to the net effect of (i) $617 million of net borrowings of debt, (ii) $75 million related to payments of financing costs and debt redemption premiums, (iii) $63 million associated with the repurchase of Liberty Latin America common shares, (iv) $48 million in payments related to distributions to noncontrolling interest owners, primarily in C&W Bahamas and C&W Panama, (v) $47 million related to the contribution from a noncontrolling interest owner, as further described in note 17 of the consolidated financial statements, and (vi) $43 million related to derivative payments.

Off Balance Sheet Arrangements

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dollar equivalents of our debt and certain other contractual obligations and commitments as of December 31, 2022.

Due to the held-for-sale presentation of the Chile JV Entities at December 31, 2021, the contractual commitments of these entities have been shown separately in the table below.

For information regarding the held-for-sale presentation of the Chile JV Entities, see note 9 to our consolidated financial statements.

Payments due by period

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1 year 1-3 years 3-5 years More than

Debt (excluding interest)

$ 7,678.3 $ 105.4 $ 997.2 $ 146.8 $ 6,428.9

Finance leases (excluding interest)

7.6 0.8 1.6 1.4 3.8

Debt (excluding interest) (a) $ 7,966.1 $ 226.0 $ 876.1 $ 2,877.1 $ 3,986.9

Operating leases 702.6 104.5 183.7 146.5 267.9

Programming minimum commitments (a) 31.0 24.9 6.0 0.1 —

Other (b) 60.2 45.8 7.8 2.8 3.8

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Projected cash interest payments on debt and finance lease obligations (d) $ 2,590.0 $ 510.7 $ 939.0 $ 918.3 $ 222.0

Chile JV Entities:

Debt (excluding interest) $ 1,522.2 $ 82.2 $ — $ — $ 1,440.0

Other contractual commitments (a) 274.2 144.3 126.2 3.7 —

Total $ 1,796.4 $ 226.5 $ 126.2 $ 3.7 $ 1,440.0

Projected cash interest payments on debt obligations (d) $ 552.9 $ 80.5 $ 161.1 $ 159.4 $ 151.9

(a) Amounts primarily represent guaranteed minimum programming fees under multi-year contracts typically based on a rate per customer or stated annual fee.

(b) Amounts primarily represent guaranteed minimum commitments associated with our customer premise equipment and mobile handset device contractual obligations.

(c) The commitments included in this table do not reflect any liabilities that are included in our December 31, 2021 consolidated balance sheet other than (i) debt and (ii) finance and operating lease obligations.

(a) Subsequent to December 31, 2022, we refinanced certain debt of our Liberty Costa Rica borrowing group.

For additional information, see note 9 to our consolidated financial statements.

(b) Amounts primarily represent (i) guaranteed minimum commitments associated with (a) programming fees under multi-year contracts typically based on a rate per customer or stated annual fee and (b) our customer premise equipment and mobile handset device contractual obligations, and (ii) finance leases, excluding interest.

(c) The commitments included in this table do not reflect any liabilities that are included in our December 31, 2022 consolidated balance sheet other than debt, finance lease obligations and operating lease obligations.

Our liability for uncertain tax positions, including accrued interest, in the various jurisdictions in which we operate ( $51 million at December 31, 2022) has been excluded from the table as the amount and timing of any related payments are not subject to reasonable estimation.

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(d) Amounts are based on interest rates, interest payment dates, commitment fees and contractual maturities in effect as of December 31, 2022.

These amounts are presented for illustrative purposes only and will likely differ from the actual cash

payments required in future periods.

These amounts are presented for illustrative purposes only and will likely differ from the actual cash payments required in future periods.

In addition, the amounts presented do not include the impact of our derivative contracts.

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Assets to be disposed of are recorded at the lower of their carrying amount or fair value less costs to sell.

We evaluate goodwill and other indefinite-lived intangible assets (primarily cable television franchise rights and spectrum licenses) for impairment at least annually on October 1 and whenever facts and circumstances indicate that the fair value of a reporting unit or an indefinite-lived intangible asset may be less than its carrying value.

We evaluate goodwill and other indefinite-lived intangible assets (primarily cable television franchise rights and spectrum licenses) for impairment at least annually on July 1 and whenever facts and circumstances indicate that the fair value of a reporting unit or an indefinite-lived intangible asset may be less than its carrying value.

When evaluating impairment with respect to goodwill and other indefinite-lived intangibles, we first make a qualitative assessment to determine if the goodwill or other indefinite-lived intangible may be impaired.

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When required, considerable management judgment is necessary to estimate the fair value of reporting units and underlying long-lived and indefinite-lived assets.

We typically determine fair value using a market-value approach or an income-based approach (discounted cash flows) based on assumptions in our long-range business plans, or a combination of an income-based and market-value approach.

We typically determine fair value using an income-based approach (discounted cash flows) based on assumptions in our long-range business plans.

With respect to our discounted cash flow analysis used in the income-based approach, the timing and amount of future cash flows under these business plans require estimates of, among other items, subscriber growth and retention rates, rates charged per product, expected gross margins and Adjusted OIBDA margins and expected property and equipment additions.

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Our determination of the discount rate is based on a weighted average cost of capital approach, which uses a market participant’s cost of equity and after-tax cost of debt and reflects certain risks inherent in the future cash flows.

With respect to a market-value approach, the fair value of a reporting unit is estimated based upon a market multiple typically applied to the reporting unit’s Adjusted OIBDA.

We determine the market multiple for each reporting unit taking the following into consideration:

(i) public company trading multiples for entities with similar business characteristics as the respective reporting unit, adjusted to reflect an appropriate control premium or discount, a “trading multiple;” and (ii) multiples derived from the value of recent transactions for businesses with similar operations and in geographically similar locations, a “transaction multiple.” Changes in the underlying assumptions used in both the income-based and market-value valuation methods can result in materially different determinations of fair value.

During 2021, we recorded goodwill impairments of $605 million related to C&W Caribbean and Networks.

During 2020, we recorded goodwill impairments of $174 million and $99 million, respectively, related to C&W Panama and C&W Caribbean and Networks, respectively.

During 2019, we recorded goodwill impairments of $185 million related to C&W Panama.

A hypothetical increase/(decrease) of 0.1% in the discount rate used in the goodwill impairment assessment that resulted in our 2021 goodwill impairment charges would have resulted in an increase/(decrease) of approximately $13 million in aggregate to the goodwill impairment.

For additional information regarding impairments recorded during 2021, 2020 and 2019, see notes 6 and 8 to our consolidated financial statements.

During 2022 and 2021, we recorded $555 million and $605 million, respectively, of goodwill impairments related to C&W Caribbean.

During 2020, we recorded goodwill impairments of $174 million and $99 million related to C&W Panama and C&W Caribbean, respectively.

A hypothetical increase/(decrease) of 0.1% in the discount rate used in the goodwill impairment assessment that resulted in our 2022 goodwill impairment charges would have resulted in an increase/(decrease) of

approximately $15 million in aggregate to the goodwill impairment.

For additional information regarding certain impairments recorded during 2022, 2021 and 2020, see notes 6 and 7 to our consolidated financial statements.

Fair Value Measurements in Acquisition Accounting

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A significant portion of our long-lived assets were initially recorded through the application of acquisition accounting.

With respect to the valuation of spectrum license as part of the AT&T Acquisition, we estimate fair value using the Greenfield methodology, which is an income approach, to estimate the price at which an orderly transaction to sell the asset would take place between market participants at the measurement date under current market conditions.

The Greenfield methodology values the spectrum licenses by calculating the cash flow generating potential of a hypothetical start-up company that goes into business with no assets except the asset to be valued (in this case, spectrum licenses) and makes investments required to build an operation comparable to current use.

The value of the spectrum licenses can be considered as equal to the present value of the cash flows of this hypothetical start-up company.

We base the assumptions underlying the Greenfield methodology on a combination of market participant data and our historical results, trends and business plans.

Future cash flows in the Greenfield methodology are based on estimates and assumptions of market participant revenues and costs, network construction build-out period and costs and a long-term growth rate for a market participant.

The cash flows are discounted using a weighted average cost of capital.

The valuation approach utilized to estimate fair value of spectrum licenses require the use of assumptions and estimates, which involve a degree of uncertainty.

For additional information, including the specific weighted average discount rates we used to complete certain nonrecurring valuations, see note 6 to our consolidated financial statements.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis