Liberty Global Reports Fiscal 2007 Results

Liberty Global, Inc. ("Liberty Global” or the "Company”) (NASDAQ:LBTYA) (NASDAQ:LBTYB) (NASDAQ:LBTYK), today announces financial and operating results for the fourth quarter ("Q4”) and year ended December 31, 2007. Highlights for the year compared to the results for the same period last year (unless noted), include: Organic RGU1 additions of 1.45 million, ending 2007 with 24.0 million RGUs Revenue of $9.0 billion, reflecting rebased2 growth of 9% Operating Cash Flow ("OCF”)3 of $3.6 billion, reflecting rebased growth of 15%                 --     Excluding Telenet, rebased OCF growth was 16% and 17% for 2007 and Q4 2007, respectively OCF margin4 of 39.6% and 39.2% for 2007 and Q4 2007 as compared to 36.0% and 35.4% for the respective 2006 periods Loss from continuing operations of $423 million as compared to a loss of $334 million in 2006 Free cash flow ("FCF”)5 of $515 million, an increase of over 85% as compared to FCF in 2006 Commenting on the year, President and CEO Mike Fries said, "Our operating results and share price performance in 2007 were attributable to three things – industry-leading organic OCF growth, opportunistic M&A activity, and aggressive management of our capital structure. We posted another year of mid-teens OCF growth with an increase of 15% (rebased) on a consolidated basis, and 16% excluding Telenet. Several operations generated superior OCF results in the year including Poland, Australia, Chile and the Czech Republic – all of which posted rebased OCF growth rates above 20% for 2007. OCF margins improved 360 basis points during the year due primarily to a combination of profitable, high-margin subscriber growth and continued focus on cost controls. With recent and upcoming product launches and new bundled offerings across many of our markets, we are excited about our growth prospects in 2008, particularly in our rapidly expanding digital cable business.” "On an organic basis, we added 2.6 million advanced service RGUs (digital video, broadband Internet and telephony) in 2007, with over 900,000 RGUs coming from digital cable. Of particular note, our operations in Japan, Belgium, Switzerland and the Czech Republic had very strong years in terms of digital additions. In the Netherlands, we have launched the entire suite of high-end video applications (DVR, VoD and HD)6, and are generating incremental digital ARPU7 of €8, a 100% increase over the comparable figure in 2006. In terms of our data and telephony products, we added 1.5 million organic RGU additions in 2007, with double- and triple-play offers proving to be a strong catalyst for customer demand. Additionally, we continue to increase data speeds in our markets, offering maximum speeds of at least 20 Mbps across most of our European markets and a next-generation 160 Mbps service in the Kansai region of Japan. On the telephony front, our voice products have found wide consumer acceptance, particularly those that provide unlimited calling for a single price.” "We had a successful 2007 on the M&A front, while remaining disciplined given the fact that private market values were considerably above public market values during the year. Our most significant activity on the buy-side was substantially increasing our ownership in Telenet to 51%. We also completed a number of small cable system acquisitions in our existing markets which, in total, added approximately 200,000 RGUs to our global subscriber base. Additionally, in 2007 we rationalized our 50% interest in Jupiter TV. As we look to 2008, we continue to have a healthy M&A pipeline of potential transactions, but will remain opportunistic and disciplined as we assess them, especially in light of the fact that we believe our own equity remains undervalued.” "In terms of capital structure management, we believe that our levered equity strategy played a major role in delivering returns to our shareholders. We purchased $1.9 billion of our own stock in 2007 and, since fall 2005, we have purchased over $4.0 billion at an average cost under $30 per share. Although the global capital markets have been challenging, we completed a major refinancing of our UPC Broadband Holding credit facility in the spring of 2007 and, in the second half of 2007, we completed three financing transactions at Telenet, Austar, and LGJ Holdings, which generated over $1.2 billion in cash for Liberty Global. As a result, our balance sheet remains solid. At year end we had $2.0 billion of cash, approximately $2.9 billion in committed, undrawn borrowing capacity8, minimal near-term debt maturities, and we are substantially hedged on both currencies and interest rates. We have been able to maintain our gross leverage within our 4.0x – 5.0x target range. As we continue to generate free cash flow and raise additional capital from leverage, we will look to deploy it in a way that further enhances long-term equity value.” "As we think about our objectives for the year ahead, we are focused on two main financial metrics: (i) mid-teens rebased OCF growth; and (ii) lower capital expenditures9 as a percentage of revenue. With that in mind, we are specifically guiding to consolidated rebased OCF growth of 14 – 16% in 2008 and capital expenditures as a percentage of revenue of 20 – 22%. Over the next several years, we expect to further drive this capital expenditure ratio lower, especially as we complete the majority of our remaining European network upgrades.” Operating Statistics Our total RGU base was 24.0 million at December 31, 2007, which represents an increase of 4.6 million RGUs or 24% from our total of 19.4 million at year end 2006. The 2007 RGU increase consisted of 3.2 million additions from M&A activity (principally Telenet) and 1.45 million additions from organic growth. We finished 2007 with 14.7 million video, 5.4 million broadband Internet and 3.9 million telephony subscribers, as we increasingly drove the penetration of our advanced services.10 This is reflected in our 1.49x bundling ratio and 33% bundling penetration at December 31, 2007, both of which reflect significant improvement over our year end 2006 bundling ratio and penetration of 1.40x and 28%, respectively. Furthermore, we added 863,000 triple-play customers across our footprint in 2007. Of our 1.45 million organic RGU additions, we added 782,000 broadband Internet and 741,000 telephony subscribers and lost 77,000 video subscribers. Organic broadband Internet and telephony subscriber growth for the year increased 3% and 22%, respectively, from our additions for these categories in the prior year period. From a quarterly phasing perspective, the fourth quarter was our strongest quarter in terms of organic additions, up 14% over the third quarter. We added 438,000 organic subscribers or 30% of our 2007 total organic additions in the fourth quarter, with notable strength in our Central and Eastern European ("CEE”) operations. In aggregate, broadband Internet was our strongest performer of the year. We continue to demonstrate speed leadership in this product category, as we now offer at least 20 Mbps service in most of our European markets. In the fourth quarter, we added 214,000 organic broadband Internet subscribers, a 13% sequential increase from the third quarter. During 2007, we added 4.1 million total homes serviceable to our broadband Internet footprint. As a result of our strong year in broadband Internet, we were able to drive our consolidated broadband Internet penetration to 21% at year end 2007 from 18% at year end 2006, led principally by penetration increases in Europe and Chile. We added 741,000 organic telephony subscribers in 2007, including a record fourth quarter with 217,000 additions. Our organic telephony additions in the CEE region for the 2007 fourth quarter and full year were 47% and 35% higher than the corresponding prior year organic additions, respectively. This was due in large part to the successful marketing of Voice-over-Internet Protocol ("VoIP”) and triple-play bundles across our footprint. We added 4.4 million telephony homes serviceable to our footprint during the year and increased consolidated telephony penetration to 16% at year end 2007 from 13% at year end 2006. Our Chilean operation currently sets the standard for Liberty Global, as it has achieved 34% telephony penetration in its footprint, while on the other hand, our CEE operations, where VoIP is relatively new, represents a significant growth opportunity as telephony penetration is only 9%. At December 31, 2007, our 14.7 million video subscriber base consisted of 10.2 million analog11, 3.4 million digital cable and 1.1 million direct-to-home ("DTH”) subscribers. In 2007, we lost 77,000 organic video subscribers, largely as a result of a 117,000 video subscriber loss in Romania due to heightened competitive factors. However, in the second half of 2007, Liberty Global added 11,000 organic video subscribers, including 6,000 in the fourth quarter, which was a substantial improvement over our loss of 88,000 organic subscribers in the first six months of 2007. This improvement during the second half of 2007 was due in part to our successful digital cable roll-out in the Czech Republic, and solid performances in Poland, Hungary and Japan. In terms of digital cable and DTH, we added 1.1 million organic subscribers in 2007, with six countries including Japan, Belgium, Switzerland, the Czech Republic, Chile, and the Netherlands, accounting for over 80% of the increase. Highlights for the year included the following: (i) J:COM finished 2007 with 67% digital penetration, an increase from 52% at December 31, 2006; (ii) both Switzerland and the Czech Republic experienced increasing digital cable additions throughout the year, ending 2007 with digital cable penetrations of 16% and 22%, respectively, which were substantial increases from their year end 2006 digital penetrations of 9% and 5%, respectively; and (iii) our fourth quarter organic digital cable and DTH additions of 381,000 were the highest of the year and reflected a 37% improvement over our fourth quarter 2006 results. Furthermore, we finished 2007 with consolidated digital cable penetration of 25%, as compared to 19% at year end 2006. Additionally, we continue to realize incremental video ARPU gains in those markets where we have launched value-added digital products, such as premium tiers, DVRs, VoD and HD. For example, in the Netherlands, we completed the launch of our full suite of advanced services in the fall and ended 2007 with incremental digital ARPU of €8, a doubling of our year end 2006 incremental digital ARPU. As we look to 2008, we have re-launched digital in Austria and created new compelling digital offers in several markets including Ireland. We also plan to launch digital cable in two of our largest CEE markets, Poland and Hungary, and to roll-out selected advanced video services in many of our European markets. As a result of these initiatives, we expect that digital cable will be an important growth driver for us in 2008. Revenue Our revenue for the three months and year ended December 31, 2007 was $2.5 billion and $9.0 billion, respectively. As compared to the respective prior year periods, these figures reflect growth rates of 38% and 39%, respectively. Excluding the impact of foreign currency ("FX”) movements, revenue increased 26% and 31% for the three months and year ended December 31, 2007, respectively, as compared to the same periods last year. The primary drivers of our year-over-year growth, exclusive of FX, were the consolidation of Telenet, organic growth and the impact of a number of smaller acquisitions in 2006 and 2007. For the three months and year ended December 31, 2007, we achieved rebased growth rates of 7% and 9%, respectively. Our rebased revenue growth for both periods was driven primarily by subscriber additions throughout the year. For 2007, our organic performance was positively impacted by double-digit rebased revenue increases in Poland, Australia, the Czech Republic, and Chile. Consolidated ARPU per customer relationship increased 13% to $39.07 for the year ended December 31, 2007 as compared to the same period last year. This annual increase was primarily impacted by the 2007 consolidation of Telenet, the appreciation of local currencies against the U.S. dollar and ARPU per customer increases at our UPC Broadband Division ("UPC”) and VTR. UPC’s ARPU per customer relationship increased 6% to €21.52 ($29.46) in 2007. This figure was driven in part by UPC’s continued improvement in product bundling, as it finished 2007 with 27% of its customer base taking two or more products, as compared to 22% at December 31, 2006. Similar to UPC, VTR increased its annual ARPU per customer relationship by 6% to CLP 24,802 ($47.49), as it has been able to increase the number of its customers taking a bundled product offering by 24% in the last year. In terms of J:COM’s 2007 ARPU per customer relationship, it decreased slightly to ¥7,350 ($62.41) as compared to the year ended December 31, 2006, primarily as a result of the dilutive impact of the Cable West acquisition. Operating Cash Flow For the three months and year ended December 31, 2007, we generated OCF of $965 million and $3.6 billion, respectively. As compared to the respective 2006 periods, this reflects growth rates of 53% for both periods. Excluding FX movements, we achieved OCF growth rates of 39% and 44% for the three months and the year ended December 31, 2007, respectively, as compared to the same periods last year. Our results reflect consolidated rebased OCF growth rates of 15% for both the three months and year ended December 31, 2007 periods. Excluding Telenet, our rebased OCF growth rate was 17% for the fourth quarter and 16% for the full year 2007, as compared to the prior year periods. Our operations in Australia, Chile, Ireland and CEE each achieved full year rebased OCF growth rates in excess of 18%. Our OCF margin for the three months ended December 31, 2007 was 39.2%, a 380 basis point improvement over our 35.4% OCF margin for the same period last year. Similarly, our OCF margin for the year ended December 31, 2007 improved to 39.6%, as compared to 36.0% for 2006. We experienced margin improvement across most markets for the fourth quarter and full year, as compared to the respective prior year periods. In particular, our operations in CEE, Chile and Ireland realized substantial margin improvement. Overall, our margin expansion in 2007 was due in large part to stringent cost controls, operational leverage, the positive impact of Telenet and healthy OCF conversion from the further sell-through of high-margin services. As we look to 2008, we see continued opportunity to increase OCF margins. Loss from Continuing Operations Our loss from continuing operations for the year ended December 31, 2007 was $423 million or $1.11 per basic and diluted share as compared to our loss from continuing operations of $334 million or $0.76 per basic and diluted share for the year ended December 31, 2006. Our loss from continuing operations increased during 2007 as the positive effects of an increase in our gains on dispositions of assets and improved operating income were more than offset by the negative effects of increased interest and income tax expenses and higher losses from certain other non-operating items. Capital Expenditures and Free Cash Flow Capital expenditures for the three months and year ended December 31, 2007 were $583 million and $2,035 million, respectively. As a percentage of revenue, capital expenditures were 23.7% and 22.6% for the three months and year ended December 31, 2007, as compared to 25.7% and 23.3% for the same periods last year, respectively. Additionally, we incurred capital lease additions of $46 million and $185 million, for the three months and year ended December 31, 2007. In terms of capital expenditures for 2007, over 50% of our capital expenditures consisted of customer premise equipment and scalable infrastructure. In terms of free cash flow, we reported FCF of $210 million and $515 million for the three months and year ended December 31, 2007, respectively. FCF improved $15 million and $238 million for the three months and year ended December 31, 2007, respectively, as compared to the respective prior year periods. On a full year basis, our FCF grew over 85%, as the positive impact of higher cash provided by our operating activities was only partially offset by higher capital expenditures. Balance Sheet, Leverage and Liquidity At December 31, 2007, total debt was $18.4 billion and cash and cash equivalents (including restricted cash related to our debt instruments) totaled $2.5 billion, resulting in net debt of $15.8 billion.12 Our debt and cash balances increased by approximately $2.1 billion and $0.5 billion from September 30, 2007, respectively. These increases were primarily driven by the successful financings and subsequent capital distributions undertaken by Telenet and Austar, the LGJ Holdings financing which synthetically leveraged our J:COM equity interest, and the impact of FX rates. As a result of the Telenet, Austar and LGJ Holdings transactions mentioned above, we generated over $1.2 billion in cash to Liberty Global. Importantly, these transactions were completed during a challenging time in the credit markets and highlight our ability to successfully access the capital markets. Additionally, our cash position at December 31, 2007 was impacted by stock repurchase activity during the fourth quarter, as we repurchased nearly $600 million of our equity. In terms of managing our debt position, we made significant improvements in our balance sheet during 2007. We capitalized on favorable markets in the first half of 2007 in order to refinance and expand our UPC Broadband Holding credit facility. As a result of the refinancing, we extended maturities and reduced the borrowing costs under this facility. On a consolidated basis, we have minimal near-term principal amortizations with only 9% of our debt and capital lease balance amortizing by December 31, 2011. Also, we continue to match substantially all of our borrowings to our underlying local currencies and have maintained a low cost of capital on our debt borrowings, with a weighted average interest rate at December 31, 2007 of 5.9%.13 For the fourth quarter of 2007, our gross and net leverage ratios, defined as total debt and net debt to last quarter annualized operating cash flow, were 4.8x and 4.1x, respectively. In addition to our cash balances at December 31, 2007, we continue to maintain significant borrowing capacity. In our primary European credit facility at UPC Broadband Holding, we expect to be able to borrow approximately €646.5 million ($943 million) of our undrawn commitments under our €1.1 billion ($1.6 billion) redrawable term loans I and L, upon completion of our fourth quarter bank reporting requirements. At December 31, 2007, our aggregate unused borrowing capacity, as represented by the maximum undrawn commitment under each of our applicable facilities (including those at Liberty Global parent, UPC Broadband Holding, Telenet, J:COM and Austar), without regard to covenant compliance calculations, was approximately $2.9 billion.8 2008 Guidance Targets For 2008, we are providing the following consolidated guidance targets for Liberty Global. Rebased revenue growth of 7 – 9%; Rebased OCF growth of 14 – 16%; and Capital expenditures (excluding capital lease additions) of 20 – 22% of revenue. About Liberty Global Liberty Global is the leading international cable operator offering advanced video, voice and broadband Internet services to connect its customers to the world of entertainment, communications and information. As of December 31, 2007, Liberty Global operated state-of-the-art networks that served approximately 16 million customers across 15 countries principally located in Europe, Japan, Chile, and Australia. Liberty Global’s operations also include significant programming businesses such as Chellomedia in Europe. Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including our expectations with respect to our 2008 guidance targets, our future growth prospects, the timing and impact of our roll-out of digital products and services, and our borrowing availability; our insight and expectations regarding competition in our markets; the impact of our M&A activity on our operations and financial performance; and other information and statements that are not historical fact. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those expressed or implied by these statements. These risks and uncertainties include the continued use by subscribers and potential subscribers of the Company's services and willingness to upgrade to our more advanced offerings, our ability to meet competitive challenges, continued growth in services for digital television at a reasonable cost, the effects of changes in technology and regulation, our ability to achieve expected operational efficiencies and economies of scale, and our ability to generate expected revenue and operating cash flow, control capital expenditures as measured by percentage of revenue and achieve assumed margins, as well as other factors detailed from time to time in the Company's filings with the Securities and Exchange Commission including our most recently filed Form 10-K. These forward-looking statements speak only as of the date of this release. The Company expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. For more information, please visit www.lgi.com. 1 Please see page 20 for definition of revenue generating units ("RGUs”). Organic figures exclude RGUs of acquired entities at the date of acquisition but include the impact of changes in RGUs from the date of acquisition. Organic figures represent additions on a net basis. 2 For purposes of calculating rebased growth rates on a comparable basis for all businesses that we owned during the respective periods in 2007, we have adjusted our historical 2006 revenue and OCF to (i) include the pre-acquisition revenue and OCF of certain entities acquired during 2006 and 2007 in the respective 2006 rebased amounts to the same extent that the revenue and OCF of such entities are included in our 2007 results and (ii) reflect the translation of our 2006 rebased amounts at the applicable average exchange rates that were used to translate our 2007 results. Please see page 10 for supplemental information. 3 Please see page 13 for our operating cash flow definition and the required reconciliation. 4 OCF margin is calculated by dividing OCF by total revenue for the applicable period. 5 Free cash flow or FCF includes amounts from both our continuing and discontinued operations and is defined as net cash provided by operating activities less capital expenditures, each as reported in our consolidated statements of cash flows. We have modified this definition from previous reporting so that non-cash capital lease additions are no longer deducted to arrive at FCF. Accordingly, prior period FCF amounts have been revised to conform to our new FCF definition. See page 15 for more information and the required reconciliation. 6 The abbreviated terms of DVR, HD and VoD are defined as follows: DVR – digital video recorder; HD – hi-definition television; and VoD – video-on-demand. 7 ARPU refers to the average monthly subscription revenue per average RGU. ARPU per customer relationship refers to the average monthly subscription revenue per average customer relationship. In both cases, the amounts are calculated by dividing the average monthly subscription revenue (excluding installation and mobile telephony revenue) for the indicated period, by the average of the opening and closing balances for RGUs or customer relationships, as the case may be, for the period. Convenience translations for ARPU per customer relationship figures are based on the average exchange rate for the quarter. 8 The $2.9 billion amount reflects the aggregate unused borrowing capacity, as represented by the maximum undrawn commitments under each of our applicable facilities without regard to covenant compliance calculations. This amount excludes approximately $274 million related to unused borrowing capacity associated with the VTR Bank Facility. Pursuant to the deposit arrangements with the lender in relation to the VTR Bank Facility, we are required to fund a cash collateral account in an amount equal to the outstanding principal and interest under the VTR Bank Facility. 9 Capital expenditures refer to the amounts reported in our consolidated statements of cash flows and therefore, exclude non-cash capital lease additions. 10 Advanced services represent our services related to digital video (including digital cable and DTH), broadband Internet and telephony. 11 Includes analog and digital MMDS subscribers. 12 Total debt includes capital lease obligations. Total cash and cash equivalents includes $485 million of restricted cash that is related to our debt instruments. Net debt is defined as total debt less cash and cash equivalents including our restricted cash balances related to our debt instruments. 13 The weighted average interest rate excludes capital lease obligations and the impact of our interest rate derivative agreements, deferred financing costs or commitment fees, all of which affect our overall cost of borrowing. Liberty Global, Inc. Condensed Consolidated Balance Sheets     December 31,   2007   2006 in millions ASSETS Current assets: Cash and cash equivalents $ 2,035.5 $ 1,880.5 Trade receivables, net 1,003.7 726.5 Other receivables, net 95.7 110.3 Restricted cash 28.5 496.1 Deferred income taxes 319.1 131.6 Derivative instruments 230.5 51.0 Other current assets   211.6   166.5 Total current assets 3,924.6 3,562.5   Restricted cash 475.5 — Investments in affiliates, accounted for using the equity method, and related receivables 388.6 1,062.7 Other investments 782.9 477.6 Property and equipment, net 10,608.5 8,136.9 Goodwill 12,626.8 9,942.6 Intangible assets subject to amortization, net 2,504.9 1,578.3 Franchise rights and other intangible assets not subject to amortization 183.7 177.1 Other assets, net   1,123.1   631.6   Total assets $ 32,618.6 $ 25,569.3   LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 804.9 $ 652.4 Deferred revenue and advance payments from subscribers and others 933.8 640.1 Current portion of debt and capital lease obligations 383.2 1,384.9 Accrued interest 341.2 257.0 Accrued capital expenditures 194.1 111.7 Other accrued and current liabilities   1,200.3   698.6 Total current liabilities 3,857.5 3,744.7   Long-term debt and capital lease obligations 17,970.2 10,845.2 Deferred tax liabilities 743.7 537.1 Other long-term liabilities   1,765.1   1,283.7 Total liabilities   24,336.5   16,410.7   Commitments and contingencies   Minority interests in subsidiaries   2,446.0   1,911.5   Stockholders’ equity   5,836.1   7,247.1   Total liabilities and stockholders’ equity $ 32,618.6 $ 25,569.3 Liberty Global, Inc. Consolidated Statements of Operations     Three months endedDecember 31, Year endedDecember 31, 2007   2006 2007   2006 in millions, except per share amounts   Revenue $ 2,461.4   $ 1,781.8   $ 9,003.3   $ 6,483.9     Operating costs and expenses: Operating (other than depreciation and amortization) (including stock-based compensation of $3.3 million, $2.8 million, $12.2 million and $7.0 million, respectively) 1,046.3 768.2 3,740.5 2,778.3 Selling, general and administrative (SG&A) (including stock-based compensation of $48.8 million, $10.7 million, $181.2 million and $63.0 million, respectively) 502.6 396.2 1,888.4 1,439.4 Depreciation and amortization 673.5 546.6 2,493.1 1,884.7 Provisions for litigation 25.0 — 171.0 — Impairment, restructuring and other operating charges, net   26.0     17.5     43.5     29.2     2,273.4     1,728.5     8,336.5     6,131.6   Operating income   188.0     53.3     666.8     352.3     Other income (expense): Interest expense (275.7 ) (191.4 ) (982.1 ) (673.4 ) Interest and dividend income 30.7 23.3 115.3 85.4 Share of results of affiliates, net 4.7 7.1 33.7 13.0 Realized and unrealized gains (losses) on financial and derivative instruments, net 195.2 (187.6 ) (38.7 ) (347.6 ) Foreign currency transaction gains, net 46.7 153.0 20.5 236.1 Other-than-temporary declines in fair values of investments (206.6 ) (3.5 ) (212.6 ) (13.8 ) Losses on extinguishment of debt, net (90.4 ) (0.2 ) (112.1 ) (40.8 ) Gains on disposition of assets, net 4.5 106.1 557.6 206.4 Other income (expense), net   (1.1 )   7.2     1.3     12.2     (292.0 )   (86.0 )   (617.1 )   (522.5 ) Earnings (loss) before income taxes, minority interests and discontinued operations (104.0 ) (32.7 ) 49.7 (170.2 ) Income tax benefit (expense) (109.3 ) 84.3 (233.1 ) 7.9 Minority interests in earnings of subsidiaries, net   16.1     (82.8 )   (239.2 )   (171.7 ) Loss from continuing operations   (197.2 )   (31.2 )   (422.6 )   (334.0 )   Discontinued operations: Earnings from operations — — — 6.8 Gain on disposal of discontinued operations   —     —     —     1,033.4     —     —     —     1,040.2     Net earnings (loss) $ (197.2 ) $ (31.2 ) $ (422.6 ) $ 706.2     Basic and diluted earnings (loss) per share: Continuing operations $ (0.54 ) $ (0.08 ) $ (1.11 ) $ (0.76 ) Discontinued operations   —     —     —     2.37   $ (0.54 ) $ (0.08 ) $ (1.11 ) $ 1.61   Liberty Global, Inc. Condensed Consolidated Statements of Cash Flows   Year ended December 31, 2007   2006 in millions Cash flows from operating activities: Net earnings (loss) $ (422.6 ) $ 706.2 Net earnings from discontinued operations   —     (1,040.2 ) Net loss from continuing operations (422.6 ) (334.0 ) Net adjustments to reconcile earnings (loss) from continuing operations to net cash provided by operating activities 2,972.4 2,137.1 Net cash provided by operating activities of discontinued operations   —     74.9   Net cash provided by operating activities   2,549.8     1,878.0     Cash flows from investing activities: Capital expended for property and equipment (2,034.5 ) (1,507.9 ) Cash paid in connection with acquisitions, net of cash acquired (1,178.8 ) (1,254.2 ) Proceeds received upon dispositions of assets 481.7 380.8 Investments in and loans to affiliates and others (43.5 ) (255.7 ) Net cash received (paid) to purchase or settle derivative instruments (110.4 ) 50.5 Proceeds received from sale of short-term liquid investments — 2.6 Other investing activities, net (11.4 ) 23.9 Proceeds received upon disposition of discontinued operations, net of disposal costs — 2,548.1 Net cash used by investing activities of discontinued operations   —     (92.5 ) Net cash used by investing activities   (2,896.9 )   (104.4 )   Cash flows from financing activities: Borrowings of debt 11,952.5 7,774.5 Repayments of debt and capital lease obligations (9,314.6 ) (6,683.3 ) Repurchase of LGI common stock (1,796.8 ) (1,756.9 ) Cash distribution by subsidiaries to minority interest owners (596.5 ) (95.3 ) Proceeds from issuance of stock by subsidiaries 124.9 18.5 Payment of deferred financing costs (95.3 ) (91.9 ) Proceeds from issuance of LGI common stock upon exercise of stock options 42.9 17.5 Change in cash collateral 6.2 (394.2 ) Other financing activities, net   17.8     (0.7 ) Net cash provided (used) by financing activities   341.1     (1,211.8 )   Effect of exchange rates on cash   161.0     116.5     Net increase in cash and cash equivalents: Continuing operations 155.0 695.9 Discontinued operations   —     (17.6 ) Net increase in cash and cash equivalents 155.0 678.3   Cash and cash equivalents: Beginning of period   1,880.5     1,202.2   End of period $ 2,035.5   $ 1,880.5     Cash paid for interest $ 887.1   $ 485.6   Net cash paid for taxes $ 76.2   $ 65.9   Revenue and Operating Cash Flow The following tables present revenue and operating cash flow by reportable segment for the three months and year ended December 31, 2007, respectively, as compared to the corresponding prior year periods. All of the reportable segments derive their revenue primarily from broadband communications services, including video, voice and broadband Internet services. Certain segments also provide competitive local exchange carrier and other business-to-business communications services. At December 31, 2007, our operating segments in the UPC Broadband Division provided services in 10 European countries. Our other Central and Eastern Europe segment includes our operating segments in Czech Republic, Poland, Romania, Slovak Republic and Slovenia. Telenet, J:COM and VTR provide broadband communications services in Belgium, Japan and Chile, respectively. Our corporate and other category includes (i) Austar and other less significant operating segments that provide broadband communications services in Puerto Rico and video programming and other services in Europe and Argentina and (ii) our corporate category. Intersegment eliminations primarily represent the elimination of intercompany transactions between our broadband communications and programming operations, primarily in Europe. We sold UPC Belgium to Telenet on December 31, 2006, and we began accounting for Telenet as a consolidated subsidiary effective January 1, 2007. As a result, we began reporting a new segment as of January 1, 2007 that includes Telenet from the January 1, 2007 consolidation date and UPC Belgium for all periods presented. The new reportable segment is not a part of the UPC Broadband Division. Segment information for all periods presented has been restated to reflect the transfer of UPC Belgium to the Telenet segment. We present only the reportable segments of our continuing operations in the following tables. For purposes of calculating rebased growth rates on a comparable basis for all businesses that we owned during 2007, we have adjusted our historical revenue and OCF for the three months and year ended December 31, 2006, respectively to (i) include the pre-acquisition revenue and OCF of certain entities acquired during 2006 and 2007 in our rebased amounts for the three months and year ended December 31, 2006 to the same extent that the revenue and OCF of such entities are included in our results for the three months and year ended December 31, 2007 and (ii) reflect the translation of our rebased amounts for the three months and year ended December 31, 2006 at the applicable average exchange rates that were used to translate our results for the three months and year ended December 31, 2007. The acquired entities that have been included in the determination of our rebased revenue and OCF for the three months ended December 31, 2006 include Telenet, JTV Thematics, Telesystems Tirol, ten small acquisitions in Europe and one small acquisition in Japan. The acquired entities that have been included in the determination of our rebased revenue and OCF for the year ended December 31, 2006 include Telenet, Cable West, Karneval, INODE, JTV Thematics, Telesystems Tirol, thirteen small acquisitions in Europe and three small acquisitions in Japan. We have reflected the revenue and OCF of these acquired entities in our 2006 rebased amounts based on what we believe to be the most reliable information that is currently available to us (generally pre-acquisition financial statements), as adjusted for the estimated effects of (i) any significant differences between U.S. generally accepted accounting principles ("GAAP”) and local generally accepted accounting principles, (ii) any significant effects of post-acquisition purchase accounting adjustments, (iii) any significant differences between our accounting policies and those of the acquired entities and (iv) other items we deem appropriate. As we did not own or operate these businesses during the pre-acquisition periods, no assurance can be given that we have identified all adjustments necessary to present the revenue and OCF of these entities on a basis that is comparable to the corresponding post-acquisition amounts that are included in our historical 2007 results or that the pre-acquisition financial statements we have relied upon do not contain undetected errors. The adjustments reflected in our 2006 rebased amounts have not been prepared with a view towards complying with Article 11 of the SEC's Regulation S-X. In addition, the rebased growth percentages are not necessarily indicative of the revenue and OCF that would have occurred if these transactions had occurred on the dates assumed for purposes of calculating our rebased 2006 amounts or the revenue and OCF that will occur in the future. The rebased growth percentages have been presented as a basis for assessing 2007 growth rates on a comparable basis, and are not presented as a measure of our pro forma financial performance for 2006. Therefore, we believe our rebased data is not a non-GAAP measure as contemplated by Regulation G or Item 10 of Regulation S-K. In each case, the tables present (i) the amounts reported by each of our reportable segments for the comparative period, (ii) the U.S. dollar change and percentage change from period to period, (iii) the percentage change from period to period, after removing FX, and (iv) the percentage change from period to period, on a rebased basis. The comparisons that exclude FX assume that exchange rates remained constant during the periods that are included in each table. Revenue           Three months ended December 31, Increase (decrease) In-crease(de-crease) excluding FX In-crease(de-crease) 2007   2006 $   % % Rebased % in millions, except % amounts UPC Broadband Division: The Netherlands $ 285.3 $ 246.6 $ 38.7 15.7 3.0 — Switzerland 236.8 207.2 29.6 14.3 6.0 — Austria 136.7 114.1 22.6 19.8 6.7 — Ireland   82.9     69.5     13.4   19.3   6.3   — Total Western Europe   741.7     637.4     104.3   16.4   5.0   3.9 Hungary 98.5 82.9 15.6 18.8 3.4 — Other Central and Eastern Europe   221.8     168.3     53.5   31.8   13.1   — Total Central and Eastern Europe   320.3     251.2     69.1   27.5   9.9   7.1 Central and corporate operations   2.0     7.3     (5.3 ) (72.6 ) (75.0 ) — Total UPC Broadband Division 1,064.0 895.9 168.1 18.8 5.7 4.2   Telenet (Belgium) 352.7 12.1 340.6 N.M. N.M. 8.3 J:COM (Japan) 619.7 535.3 84.4 15.8 11.2 6.7 VTR (Chile) 174.5 147.3 27.2 18.5 12.5 12.5 Corporate and other 275.2 211.7 63.5 30.0 16.2 — Intersegment eliminations   (24.7 )   (20.5 )   (4.2 ) (20.5 ) (6.9 ) —   Total consolidated LGI $ 2,461.4   $ 1,781.8   $ 679.6   38.1   26.0   6.9     Year ended December 31, Increase (decrease) In-crease(de-crease)excluding FX In-crease(de-crease) 2007 2006 $ % % Rebased % in millions, except % amounts UPC Broadband Division: The Netherlands $ 1,060.6 $ 923.9 $ 136.7 14.8 5.2 — Switzerland 873.9 771.8 102.1 13.2 8.3 — Austria 503.1 420.0 83.1 19.8 9.9 — Ireland   307.2     262.6     44.6   17.0   7.3   — Total Western Europe   2,744.8     2,378.3     366.5   15.4   7.3   6.4 Hungary 377.1 307.1 70.0 22.8 7.4 — Other Central and Eastern Europe   806.1     574.0     232.1   40.4   24.0   — Total Central and Eastern Europe   1,183.2     881.1     302.1   34.3   18.2   10.2 Central and corporate operations   11.1     17.9     (6.8 ) (38.0 ) (40.7 ) — Total UPC Broadband Division 3,939.1 3,277.3 661.8 20.2 10.0 7.3   Telenet (Belgium) 1,291.3 43.8 1,247.5 N.M. N.M. 9.4 J:COM (Japan) 2,249.5 1,902.7 346.8 18.2 19.4 9.1 VTR (Chile) 634.9 558.9 76.0 13.6 11.7 11.7 Corporate and other 975.7 772.3 203.4 26.3 16.2 — Intersegment eliminations   (87.2 )   (71.1 )   (16.1 ) (22.6 ) (12.2 ) —   Total consolidated LGI $ 9,003.3   $ 6,483.9   $ 2,519.4   38.9   31.1   8.9   N.M. – Not Meaningful Operating Cash Flow           Three monthsended December 31, Increase (decrease) In-crease (de-crease) excluding FX In-crease(de-crease) 2007   2006 $   % % Rebased % in millions, except % amounts UPC Broadband Division: The Netherlands $ 156.8 $ 124.4 $ 32.4 26.0 12.1 — Switzerland 106.7 93.2 13.5 14.5 6.2 — Austria 60.8 49.1 11.7 23.8 10.5 — Ireland   34.3     22.1     12.2   55.2   38.0   — Total Western Europe   358.6     288.8     69.8   24.2   11.9   10.8 Hungary 49.3 40.4 8.9 22.0 6.8 — Other Central and Eastern Europe   110.9     71.6     39.3   54.9   31.7   — Total Central and Eastern Europe   160.2     112.0     48.2   43.0   22.8   20.5 Central and corporate operations   (66.4 )   (54.4 )   (12.0 ) (22.1 ) (7.3 ) — Total UPC Broadband Division 452.4 346.4 106.0 30.6 16.1 14.6   Telenet (Belgium) 154.5 7.4 147.1 N.M. N.M. 6.2 J:COM (Japan) 251.3 201.0 50.3 25.0 20.1 17.7 VTR (Chile) 71.2 54.4 16.8 30.9 24.4 24.4 Corporate and other   35.2     21.7     13.5   62.2   35.1   —   Total $ 964.6   $ 630.9   $ 333.7   52.9   39.3   15.0     Year ended December 31, Increase (decrease) In-crease(de-crease) excluding FX In-crease(de-crease) 2007 2006 $ % % Rebased % in millions, except % amounts UPC Broadband Division: The Netherlands $ 556.5 $ 451.9 $ 104.6 23.1 12.7 — Switzerland 419.3 353.7 65.6 18.5 13.6 — Austria 237.5 195.7 41.8 21.4 11.4 — Ireland   104.7     79.9     24.8   31.0   19.7   — Total Western Europe 1,318.0   1,081.2     236.8   21.9   13.3   12.8 Hungary 189.9 145.3 44.6 30.7 14.5 — Other Central and Eastern Europe   404.0     264.4     139.6   52.8   34.4   — Total Central and Eastern Europe   593.9     409.7     184.2   45.0   27.4   18.5 Central and corporate operations   (237.8 )   (206.2 )   (31.6 ) (15.3 ) (5.2 ) — Total UPC Broadband Division 1,674.1 1,284.7 389.4 30.3 19.1 16.0   Telenet (Belgium) 597.1 24.1 573.0 N.M. N.M. 11.7 J:COM (Japan) 911.6 738.6 173.0 23.4 24.7 14.2 VTR (Chile) 249.2 198.5 50.7 25.5 23.3 23.3 Corporate and other   135.8     90.3     45.5   50.4   31.9   —   Total $ 3,567.8   $ 2,336.2   $ 1,231.6   52.7   43.8   15.4   N.M. – Not Meaningful Operating Cash Flow Definition and Reconciliation Operating cash flow is not a GAAP measure. Operating cash flow is the primary measure used by our chief operating decision maker to evaluate segment operating performance and to decide how to allocate resources to segments. As we use the term, operating cash flow is defined as revenue less operating and SG&A expenses (excluding stock-based compensation, depreciation and amortization, provisions for litigation, and impairment, restructuring and other operating charges or credits). We believe operating cash flow is meaningful because it provides investors a means to evaluate the operating performance of our segments and our company on an ongoing basis using criteria that is used by our internal decision makers. Our internal decision makers believe operating cash flow is a meaningful measure and is superior to other available GAAP measures because it represents a transparent view of our recurring operating performance 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. For example, our internal decision makers believe that the inclusion of impairment and restructuring charges within operating cash flow would distort the ability to efficiently assess and view the core operating trends in our segments. In addition, our internal decision makers believe our measure of operating cash flow is important because analysts and investors use it to compare our performance to other companies in our industry. However, our definition of operating cash flow may differ from cash flow measurements provided by other public companies. A reconciliation of total segment operating cash flow to our consolidated earnings (loss) before income taxes, minority interests and discontinued operations, is presented below. Operating cash flow should be viewed as a measure of operating performance that is a supplement to, and not a substitute for, operating income, net earnings, cash flow from operating activities and other GAAP measures of income.     Three months ended December 31,   Year ended December 31, 2007   2006 2007   2006 in millions   Total segment operating cash flow $ 964.6 $ 630.9 $ 3,567.8 $ 2,336.2 Stock-based compensation expense (52.1 ) (13.5 ) (193.4 ) (70.0 ) Depreciation and amortization (673.5 ) (546.6 ) (2,493.1 ) (1,884.7 ) Provisions for litigation (25.0 ) — (171.0 ) — Impairment, restructuring and other operating charges, net   (26.0 )   (17.5 )   (43.5 )   (29.2 ) Operating income 188.0 53.3 666.8 352.3 Interest expense (275.7 ) (191.4 ) (982.1 ) (673.4 ) Interest and dividend income 30.7 23.3 115.3 85.4 Share of results of affiliates, net 4.7 7.1 33.7 13.0 Realized and unrealized gains (losses) on financial and derivative instruments, net 195.2 (187.6 ) (38.7 ) (347.6 ) Foreign currency transaction gains, net 46.7 153.0 20.5 236.1 Other-than-temporary declines in fair values of investments (206.6 ) (3.5 ) (212.6 ) (13.8 ) Losses on extinguishment of debt, net (90.4 ) (0.2 ) (112.1 ) (40.8 ) Gains on disposition of assets, net 4.5 106.1 557.6 206.4 Other income (expense), net   (1.1 )   7.2     1.3     12.2   Earnings (loss) before income taxes, minority interests and discontinued operations $ (104.0 ) $ (32.7 ) $ 49.7   $ (170.2 ) Summary of Debt, Capital Lease Obligations and Cash and Cash Equivalents The following table1 details the U.S. dollar equivalent balances of our consolidated debt, capital lease obligations and cash and cash equivalents at December 31, 2007:   Debt   CapitalLeaseObligations   Debt andCapital LeaseObligations   Cashand CashEquivalents2 in millions LGI and its non-operating subsidiaries $ 2,505.6 $ — $ 2,505.6 $ 1,411.8 UPC Broadband Division: UPC Broadband Holding (excluding VTR) 7,220.1 27.3 7,247.4 156.9 UPC Holding 1,968.8 — 1,968.8 1.1 J:COM 1,495.3 499.7 1,995.0 204.8 Telenet 2,897.8 75.8 2,973.6 111.7 VTR 470.3 0.8 471.1 66.1 Austar 678.3 — 678.3 26.2 Chellomedia 344.2 0.1 344.3 48.3 Liberty Puerto Rico 169.3 — 169.3 4.9 Other operating subsidiaries   —   —   —   3.7 Total LGI $ 17,749.7 $ 603.7 $ 18,353.4 $ 2,035.5 Capital Expenditures and Capital Lease Additions The table below highlights our capital expenditures per category, as well as capital lease additions for the three months and year ended December 31, 2007 and 2006:   Three months ended December 31,   Year endedDecember 31, 2007   2006 2007   2006 in millions Customer premises equipment $ 199.1 $ 186.7 $ 828.8 $ 630.5 Scalable infrastructure 104.3 70.5 280.1 203.0 Line extensions 41.3 49.1 149.1 166.1 Upgrade/rebuild 89.2 68.6 332.1 201.2 Support capital 137.7 77.8 376.7 287.2 Other including Chellomedia   11.7     4.8     67.7     19.9   Total capital expenditures ("capex”) $ 583.3   $ 457.5   $ 2,034.5   $ 1,507.9   Capital expenditures $ 583.3 $ 457.5 $ 2,034.5 $ 1,507.9 Capital lease additions   46.0     77.8     185.2     150.4   Total capex and capital leases $ 629.3   $ 535.3   $ 2,219.7   $ 1,658.3     As % of revenue Capital expenditures 23.7 % 25.7 % 22.6 % 23.3 % Capex and capital leases 25.6 % 30.0 % 24.7 % 25.6 % Free Cash Flow Definition and Reconciliation FCF includes amounts from both our continuing and discontinued operations and is defined as net cash provided by operating activities less capital expenditures, each as reported in our consolidated statements of cash flows. We have modified this definition from previous reporting so that non-cash capital lease additions are no longer deducted to arrive at FCF. Accordingly, prior period FCF amounts have been revised to conform to our new FCF definition. Adjusted FCF represents FCF less non-cash capital lease additions. FCF and Adjusted FCF are not GAAP measures of liquidity. We believe that our presentation of FCF and Adjusted FCF provides useful information to our investors because these measures can be used to gauge our ability to service debt and fund new investment opportunities. FCF should not be understood to represent our ability to fund discretionary amounts, as we have various mandatory and contractual obligations, including debt repayments, which are not deducted to arrive at this amount. Investors should view FCF as a supplement to, and not a substitute for, GAAP measures of liquidity included in our consolidated cash flow statements. The table below highlights the reconciliation of net cash from operating activities to FCF and FCF to Adjusted FCF for the three months and year ended December 31, 2007 and 2006, respectively:   Three months ended December 31,   Year ended December 31, 2007   2006 2007   2006 in millions Net cash provided by continuing operations $ 793.7 $ 652.6 $ 2,549.8 $ 1,803.1 Capital expenditures of continuing operations (583.3 ) (457.5 ) (2,034.5 ) (1,507.9 ) FCF of discontinued operations   —     —     —     (17.8 ) FCF $ 210.4   $ 195.1   $ 515.3   $ 277.4     FCF $ 210.4 $ 195.1 $ 515.3 $ 277.4 Capital lease additions   (46.0 )   (77.8 )   (185.2 )   (150.4 ) Adjusted FCF $ 164.4   $ 117.3   $ 330.1   $ 127.0   ARPU per Customer Relationship Table3 The following table provides ARPU per customer relationship for the year ended December 31, 2007 and 2006:   Year ended December 31,   2007   2006 % Change UPC Broadband € 21.52 € 20.31 6.0 % Telenet € 31.98 N.M. N.M.   J:COM ¥ 7,350 ¥ 7,389 (0.5 )%   VTR CLP 24,802 CLP 23,378 6.1 %   Liberty Global Consolidated $ 39.07 $ 34.55 13.1 %   N.M. – Not Meaningful Customer Breakdown and Bundling The following table provides information on the geography of our customer base and highlights our customer bundling metrics at December 31, 2007, September 30, 2007 and December 31, 2006:               Dec 31,2007 Sep 30, 2007 Dec 31, 2006 Q4’07 /Q3’07(% Change) Q4’07 /Q4’06(% Change) Total Customers UPC Broadband 9,685,900 9,665,500 9,719,000 0.2% (0.3)% Telenet 2,043,800 2,044,800 — 0.0% N.M. J:COM 2,659,100 2,615,300 2,512,200 1.7% 5.8% VTR 992,800 981,600 940,700 1.1% 5.5% Other 783,600 802,600 671,300 (2.4)% 16.7% Liberty Global Consolidated 16,165,200 16,109,800 13,843,200 0.3% 16.8%   Total Single-Play Customers 10,784,100 10,941,400 9,976,800 (1.4)% 8.1% Total Double-Play Customers 2,892,600 2,909,800 2,241,200 (0.6)% 29.1% Total Triple-Play Customers 2,488,500 2,258,600 1,625,200 10.2% 53.1%   % Double-Play Customers UPC Broadband 15.3% 15.6% 14.0% (1.9)% 9.3% Telenet 24.3% 23.8% — 2.1% N.M. J:COM 27.5% 27.5% 28.3% 0.0% (2.8)% VTR 16.1% 16.9% 14.6% (4.7)% 10.3% Liberty Global Consolidated 17.9% 18.1% 16.2% (1.1)% 10.5%   % Triple-Play Customers UPC Broadband 11.6% 10.0% 7.8% 16.0% 48.7% Telenet 15.0% 14.1% — 6.4% N.M. J:COM 24.8% 24.2% 22.0% 2.5% 12.7% VTR 39.0% 36.8% 32.1% 6.0% 21.5% Liberty Global Consolidated 15.4% 14.0% 11.7% 10.0% 31.6%   RGUs per Customer Relationship   UPC Broadband 1.38 1.36 1.30 1.5% 6.2% Telenet 1.54 1.52 — 1.3% N.M. J:COM 1.77 1.76 1.73 0.6% 2.3% VTR 1.94 1.90 1.79 2.1% 8.4% Liberty Global Consolidated 1.49 1.46 1.40 2.1% 6.4%   N.M. – Not Meaningful Fixed Income Overview The following tables provide preliminary financial information for selected credit groups and are subject to completion of the respective financial statements and to finalization of the respective compliance certificates for the fourth quarter of 2007.   Revenue   Operating Cash Flow4 Three months ended Dec. 31, 2007   Year ended Dec. 31, 2007 Three monthsendedDec. 31, 2007   Year ended Dec. 31, 2007 in millions UPC Holding B.V. € 854.8 € 3,334.0 € 361.6 € 1,402.7 Chellomedia Programming Financing HoldCo B.V.5 52.1 184.2 14.1 51.8     Summary of Debt and Capital Lease Obligations, Cash and Cash Equivalents and Covenant Calculations6   December 31, 2007 Total Debt and Capital Lease Obligations Cash and Cash Equivalents Senior Leverage Total Leverage in millions UPC Holding B.V.7 € 6,642.9 € 153.6 3.56x 4.48x Chellomedia Programming Financing HoldCo B.V. 236.0 21.1 3.61x 3.61x Operating Cash Flow Definition and Reconciliations Operating cash flow is not a GAAP measure. Operating cash flow is the primary measure used by our chief operating decision makers to evaluate operating performance and to decide how to allocate resources. As we use the term, operating cash flow is defined as revenue less operating and SG&A expenses (excluding stock-based compensation, depreciation and amortization, and other charges or credits outlined in the respective tables below). Investors should view operating cash flow as a measure of operating performance that is a supplement to, and not a substitute for, operating income, net earnings, cash flow from operating activities and other GAAP measures of income. The following tables provide the respective reconciliations for each of the selected credit groups.   Three months ended   Year ended December 31, 2007 December 31, 2007 UPC Holding B.V. in millions Total segment operating cash flow € 361.6 € 1,402.7 Stock-based compensation expense (14.2 ) (55.9 ) Depreciation and amortization (270.1 ) (1,074.0 ) Related party management credits 16.4 32.3 Impairment, restructuring and other operating charges (9.7 ) (19.7 ) Operating income € 84.0   € 285.4       Chellomedia Programming Financing HoldCo B.V. Total segment operating cash flow € 14.1 € 51.8 Stock-based compensation expense (0.3 ) (11.4 ) Depreciation and amortization (4.4 ) (16.4 ) Related party management fees (1.9 ) (9.2 ) Impairment, restructuring and other operating charges —   (0.4 ) Operating income € 7.5   € 14.4   1 With the exception of UPC Holding, which is stated on a stand-alone basis, the amounts reported in the table include the named entity and its subsidiaries unless otherwise noted. 2 Excludes $485 million of restricted cash that is related to our debt instruments. 3 ARPU per customer relationship refers to the average monthly subscription revenue per average customer relationship and is calculated by dividing the average monthly subscription revenue (excluding installation and mobile telephony revenue) for the indicated period, by the average of the opening and closing balances for customer relationships for the period. Customer relationships of entities acquired during the period are normalized. ARPU per customer relationship for UPC Broadband and Liberty Global Consolidated are not adjusted for currency impacts. ARPU for Telenet in 2006 is not shown since it only would pertain to the operations of UPC Belgium, and thus, would not be comparable to the Telenet ARPU in 2007. 4 Please note that reported OCF may differ from what is used in the calculation of the respective covenants. 5 The figures for the three months and year ended December 31, 2007 reflect the following: On May 25, 2007, the Extreme channel was transferred by ESC Programming B.V., a subsidiary of Chellomedia Programming B.V., to Zonemedia Broadcasting Limited, a subsidiary of Chellomedia Programming Financing HoldCo B.V. On October 1, 2007, At Media Sp.z.o.o., a subsidiary of Chellomedia Programming B.V., was transferred to Chellomedia CEE Holdco B.V., a subsidiary of Chellomedia Programming Financing HoldCo B.V. Both of these transfers were between entities under common control and have been reflected in the reporting as if they occurred on January 1, 2007. 6 In the covenant calculations, we utilize debt figures that take into account currency swaps. Thus, the debt used in the calculations may differ from the debt balances reported within the financial statements. The ratios for each of the two entities are based on December 31, 2007 results, and are subject to completion of our fourth quarter bank reporting requirements. The ratios for each entity are defined and calculated in accordance with the applicable credit agreement. As defined and calculated in accordance with the UPC Broadband Holding Bank Facility, senior leverage refers to Senior Debt to Annualized EBITDA (last two quarters annualized) and total leverage refers to Total Debt to Annualized EBITDA (last two quarters annualized). For Chellomedia Programming Financing HoldCo B.V., senior leverage refers to Senior Net Debt to Annualized EBITDA (last two quarters annualized) and total leverage refers to Total Net Debt to Annualized EBITDA (last two quarters annualized). 7 Debt for UPC Holding B.V. reflects only third party debt.   Consolidated Operating Data - December 31, 2007         Video   Internet   Telephone Homes Passed (1) Two-Way Homes Passed (2) Customer Relationships (3) Total RGUs (4) Analog Cable Sub-scribers (5)   Digital Cable Sub-scribers (6)   DTH Sub-scribers (7)   MMDS Sub-scribers (8)   Total Video Homes Serviceable (9)   Subscribers (10) Homes Serviceable (11)   Subscribers (12) UPC Broadband Division: The Netherlands 2,705,200 2,602,100 2,155,400 3,281,500 1,601,800 550,300 - - 2,152,100 2,602,100 640,300 2,534,000 489,100 Switzerland (13) 1,850,800 1,309,800 1,552,500 2,294,500 1,298,400 252,700 - - 1,551,100 1,499,800 454,900 1,497,800 288,500 Austria 1,076,000 1,076,000 759,400 1,185,900 490,600 59,600 - - 550,200 1,076,000 441,700 1,076,000 194,000 Ireland 856,000 408,200 592,300 675,900 253,700 226,100 - 105,200 585,000 408,200 80,500 231,000 10,400 Total Western Europe 6,488,000 5,396,100 5,059,600 7,437,800 3,644,500 1,088,700 - 105,200 4,838,400 5,586,100 1,617,400 5,338,800 982,000 Hungary 1,166,600 1,117,100 988,400 1,343,100 706,000 - 168,000 - 874,000 1,117,100 281,400 1,119,700 187,700 Romania 2,056,200 1,561,300 1,337,500 1,615,700 1,185,100 37,400 115,000 - 1,337,500 1,436,000 181,800 1,374,200 96,400 Poland 1,966,800 1,564,400 1,064,700 1,421,300 1,011,300 - - - 1,011,300 1,564,400 297,300 1,516,700 112,700 Czech Republic 1,270,100 1,065,900 775,500 1,031,700 445,800 124,200 129,400 - 699,400 1,065,900 249,000 1,063,000 83,300 Slovak Republic 463,100 331,400 305,400 352,100 261,600 3,200 26,900 7,900 299,600 303,300 42,600 168,500 9,900 Slovenia 196,900 141,300 154,800 209,800 150,100 1,100 - 3,600 154,800 141,300 45,000 141,300 10,000 Total Central and Eastern Europe 7,119,700 5,781,400 4,626,300 5,973,700 3,759,900 165,900 439,300 11,500 4,376,600 5,628,000 1,097,100 5,383,400 500,000 Total UPC Broadband Division 13,607,700 11,177,500 9,685,900 13,411,500 7,404,400 1,254,600 439,300 116,700 9,215,000 11,214,100 2,714,500 10,722,200 1,482,000   Telenet (Belgium) (14) 1,920,000 1,920,000 2,043,800 3,152,300 1,340,700 390,800 - - 1,731,500 2,743,800 872,900 2,743,800 547,900   J:COM (Japan) 9,438,200 9,438,200 2,659,100 4,712,200 717,800 1,470,200 - - 2,188,000 9,438,200 1,211,600 9,415,300 1,312,600   The Americas: VTR (Chile) 2,441,200 1,652,400 992,800 1,926,800 669,300 183,300 - - 852,600 1,652,400 520,300 1,625,400 553,900 Puerto Rico 340,800 340,800 114,500 162,800 - 85,200 - - 85,200 340,800 58,000 340,800 19,600 Total The Americas 2,782,000 1,993,200 1,107,300 2,089,600 669,300 268,500 - - 937,800 1,993,200 578,300 1,966,200 573,500   Austar (Australia) 2,462,200 - 669,100 669,100 - 9,300 659,500 - 668,800 30,400 300 - -   Grand Total 30,210,100 24,528,900 16,165,200 24,034,700 10,132,200 3,393,400 1,098,800 116,700 14,741,100 25,419,700 5,377,600 24,847,500 3,916,000   Subscriber Variance Table – December 31, 2007 vs. September 30, 2007         Video   Internet   Telephone Homes Passed (1) Two- way Homes Passed (2) Customer Relationships (3) Total RGUs (4) Analog Cable Sub-scribers (5)   Digital Cable Sub-scribers (6)   DTH Sub-scribers (7)   MMDS Sub-scribers (8)   Total Video Homes Serviceable (9)   Subscribers (10) Homes Serviceable (11)   Subscribers (12) UPC Broadband Division: The Netherlands 6,700 3,000 (21,600 ) 17,000 (40,300 ) 18,900 - - (21,400 ) 3,000 15,800 36,000 22,600 Switzerland(13) 3,400 3,400 (3,000 ) 17,500 (40,100 ) 37,100 - - (3,000 ) 3,400 11,100 3,400 9,400 Austria 88,800 88,800 49,600 86,900 40,200 8,200 - - 48,400 88,800 24,100 88,800 14,400 Ireland (5,300 ) 24,500   1,200   9,500   (2,800 ) 5,400   - (2,600 ) -   24,500   6,900   77,700 2,600 Total Western Europe 93,600   119,700   26,200   130,900   (43,000 ) 69,600   - (2,600 ) 24,000   119,700   57,900   205,900 49,000 Hungary 7,000 11,400 (9,000 ) 48,500 (1,500 ) - 5,900 - 4,400 11,400 23,000 11,400 21,100 Romania 1,400 84,100 (30,000 ) 9,900 (76,000 ) 17,800 28,500 - (29,700 ) 84,100 24,200 84,200 15,400 Poland 10,800 133,300 16,000 60,200 10,300 - - - 10,300 133,300 33,900 129,000 16,000 Czech Republic 800 11,200 16,200 45,000 (46,500 ) 56,300 2,700 - 12,500 11,200 18,300 11,300 14,200 Slovak Republic 13,800 31,200 1,800 9,600 1,500 2,800 3,700 (7,000 ) 1,000 23,800 3,500 1,000 5,100 Slovenia 1,300   1,500   (800 ) 5,700   (1,300 ) 100   - 300   (900 ) 1,500   2,300   1,500 4,300 Total Central and Eastern Europe 35,100 272,700 (5,800 ) 178,900 (113,500 ) 77,000 40,800 (6,700 ) (2,400 ) 265,300 105,200 238,400 76,100 Total UPC Broadband Division 128,700   392,400   20,400   309,800   (156,500 ) 146,600   40,800 (9,300 ) 21,600   385,000   163,100   444,300 125,100   Telenet (Belgium)(14) 4,900   4,900   (1,000 ) 42,900   (56,800 ) 52,500   - -   (4,300 ) 6,800   22,800   6,800 24,400   J:COM (Japan) 72,500   72,500   43,800   110,600   (76,500 ) 104,800   - -   28,300   72,500   29,600   71,700 52,700   The Americas: VTR (Chile) 28,600 35,100 11,200 57,100 (27,500 ) 39,800 - - 12,300 35,100 20,300 34,800 24,500 Puerto Rico 2,500 2,500 (1,100 ) (600 ) - (3,900 ) - - (3,900 ) 2,500 2,400 2,500 900 Brazil (14,300 ) (14,300 ) (14,300 ) (16,300 ) - - - (14,300 ) (14,300 ) (14,300 ) (2,000 ) - - Peru (68,400 ) (52,400 ) (14,300 ) (16,200 ) (11,500 ) -   - -   (11,500 ) (52,400 ) (4,700 ) - - Total The Americas (51,600 ) (29,100 ) (18,500 ) 24,000   (39,000 ) 35,900   - (14,300 ) (17,400 ) (29,100 ) 16,000   37,300 25,400   Austar (Australia) 2,200   -   10,700   10,700   -   200   10,600 -   10,800   -   (100 ) - -   Grand Total 156,700   440,700   55,400   498,000   (328,800 ) 340,000   51,400 (23,600 ) 39,000   435,200   231,400   560,100 227,600   ORGANIC GROWTH SUMMARY: UPC Broadband Division 48,400 307,400 (30,300 ) 222,600 (199,600 ) 137,800 40,800 (9,300 ) (30,300 ) 300,000 138,300 359,300 114,600 Telenet (Belgium) 4,900 4,900 (7,100 ) 37,900 (61,100 ) 50,800 - - (10,300 ) 6,800 23,800 6,800 24,400 J:COM (Japan) 72,500 72,500 43,800 110,600 (76,500 ) 104,800 - - 28,300 72,500 29,600 71,700 52,700 The Americas 30,300 36,800 9,400 55,900 (27,300 ) 35,900 - (800 ) 7,800 36,800 22,700 37,300 25,400 Austar (Australia) 2,200   -   10,700   10,700   -   200   10,600 -   10,800   -   (100 ) - - Total Organic Change 158,300   421,600   26,500   437,700   (364,500 ) 329,500   51,400 (10,100 ) 6,300   416,100   214,300   475,100 217,100   ADJUSTMENTS FOR M&A AND OTHER: Acquisition - Tirol (Austria) 85,000   85,000   50,700   84,000   43,100   5,600   - -   48,700   85,000   24,800   85,000 10,500 Total Q4 acquisitions 85,000   85,000   50,700   84,000   43,100   5,600   - -   48,700   85,000   24,800   85,000 10,500   Dec. 31, 2007 deconsolidation of Brazil and Peru (81,900 ) (65,900 ) (27,900 ) (31,900 ) (11,700 ) - - (13,500 ) (25,200 ) (65,900 ) (6,700 ) - - Q4 2007 Belgium adjustment - - 6,100 5,000 4,300 1,700 - - 6,000 - (1,000 ) - - Q4 2007 Ireland adjustment (4,700 ) -   -   3,200   -   3,200   - -   3,200   -   -   - - Net adjustments for M&A and other (1,600 ) 19,100   28,900   60,300   35,700   10,500   - (13,500 ) 32,700   19,100   17,100   85,000 10,500   Total Net Adds (Reductions) 156,700   440,700   55,400   498,000   (328,800 ) 340,000   51,400 (23,600 ) 39,000   435,200   231,400   560,100 227,600 Footnotes for pages 18 – 19 (1) Homes Passed are homes that can be connected to our networks without further extending the distribution plant, except for direct-to-home (DTH) and Multi-channel Multipoint (microwave) Distribution System (MMDS) homes. Our Homes Passed counts are based on census data that can change based on either revisions to the data or from new census results. With the exception of Austar, we do not count homes passed for DTH. With respect to Austar, we count all homes in the areas that Austar is authorized to serve as Homes Passed. With respect to MMDS, one Home Passed is equal to one MMDS subscriber. Due to the fact that we do not own the partner networks (defined below) used by Cablecom in Switzerland (see note 13) and Telenet in Belgium (see note 14), or the unbundled loop and shared access network used by one of our Austrian subsidiaries, UPC Austria GmbH (Austria GmbH), we do not report homes passed for Cablecom’s and Telenet’s partner networks or for Austria GmbH’s unbundled loop and shared access network. (2) Two-way Homes Passed are Homes Passed by our networks where customers can request and receive the installation of a two-way addressable set-top converter, cable modem, transceiver and/or voice port which, in most cases, allows for the provision of video and Internet services and, in some cases, telephone services. Due to the fact that we do not own the partner networks used by Cablecom in Switzerland and Telenet in Belgium or the unbundled loop and shared access network used by Austria GmbH, we do not report two-way homes passed for Cablecom’s and Telenet’s partner networks or for Austria GmbH’s unbundled loop and shared access network. (3) Customer Relationships are the number of customers who receive at least one level of service without regard to which service(s) they subscribe. To the extent that Revenue Generating Units include equivalent billing unit (EBU) adjustments, we reflect corresponding adjustments to our Customer Relationship counts. We exclude mobile customers from Customer Relationships. (4) Revenue Generating Unit is separately an Analog Cable Subscriber, Digital Cable Subscriber, DTH Subscriber, MMDS Subscriber, Internet Subscriber or Telephone Subscriber. A home may contain one or more RGUs. For example, if a residential customer in our Austrian system subscribed to our digital cable service, telephone service and broadband Internet service, the customer would constitute three RGUs. Total RGUs is the sum of Analog Cable, Digital Cable, DTH, MMDS, Internet and Telephone Subscribers. In some cases, non-paying subscribers are counted as subscribers during their free promotional service period. Some of these subscribers choose to disconnect after their free service period. (5) Analog Cable Subscriber is comprised of analog cable customers that are counted on a per connection or EBU basis. In Europe, we have approximately 652,600 "lifeline” customers that are counted on a per connection basis, representing the least expensive regulated tier of basic cable service, with only a few channels. Telenet’s Analog Cable Subscribers at December 31, 2007, include 23,800 subscribers who receive Telenet’s premium video service on a stand alone basis over the Telenet partner network. Each such premium video subscriber is assumed to represent one customer relationship. (6) Digital Cable Subscriber is a customer with one or more digital converter boxes that receives our digital cable service. We count a subscriber with one or more digital converter boxes that receives our digital cable service as just one subscriber. A Digital Cable Subscriber is not counted as an Analog Cable Subscriber. Individuals who receive digital cable service through a purchased digital set-top box but do not pay a monthly digital service fee are only counted as Digital Cable Subscribers to the extent we can verify that such individuals are subscribing to analog cable service. We include this group of subscribers in Telenet’s Digital Cable Subscribers, but exclude them from Cablecom’s Digital Cable Subscribers. Subscribers to digital cable services provided by Cablecom over partner networks receive analog cable services from the partner networks as opposed to Cablecom. As we migrate customers from analog to digital cable services, we report a decrease in our Analog Cable Subscribers equal to the increase in our Digital Cable Subscribers. (7) DTH Subscriber is a home or commercial unit that receives our video programming broadcast directly to the home via a geosynchronous satellite. (8) MMDS Subscriber is a home or commercial unit that receives our video programming via a multi-channel multipoint (microwave) distribution system. (9) Internet Homes Serviceable are homes that can be connected to our broadband networks, or a partner network with which we have a service agreement, where customers can request and receive broadband Internet services. With respect to Austria GmbH, we do not report as Internet Homes Serviceable those homes served either over an unbundled loop or over a shared access network because they are not serviced over our networks. (10) Internet Subscriber is a home or commercial unit or EBU with one or more cable modem connections to our broadband networks, or that we service through a partner network, where a customer has requested and is receiving broadband Internet services. Our Internet Subscribers in Austria include residential digital subscriber line (DSL) subscribers of Austria GmbH that are not serviced over our networks. Our Internet Subscribers do not include customers that receive services via resale arrangements or from dial-up connections. (11) Telephone Homes Serviceable are homes that can be connected to our networks, or a partner network with which we have a service agreement, where customers can request and receive voice services. With respect to Austria GmbH, we do not report as Telephone Homes Serviceable those homes served over an unbundled loop rather than our network. (12) Telephone Subscriber is a home or commercial unit or EBU connected to our networks, or that we service through a partner network, where a customer has requested and is receiving voice services. Telephone Subscribers as of December 31, 2007, exclude an aggregate of 150,800 mobile telephone subscribers in the Netherlands, Australia and Belgium. Also, our Telephone Subscribers do not include customers that receive services via resale arrangements. Our Telephone Subscribers in Austria include residential subscribers served by Austria GmbH through an unbundled loop. (13) Pursuant to service agreements, Cablecom offers digital cable, broadband Internet and telephony services over networks owned by third party cable operators (partner networks). A partner network RGU is only recognized if Cablecom has a direct billing relationship with the customer. Homes Serviceable for partner networks represent the estimated number of homes that are technologically capable of receiving the applicable service within the geographic regions covered by Cablecom’s service agreements. Internet and Telephone Homes Serviceable and Customer Relationships with respect to partner networks have been estimated by Cablecom. These estimates may change in future periods as more accurate information becomes available. Cablecom’s partner network information generally is presented one quarter in arrears such that information included in our December 31, 2007 subscriber table is based on September 30, 2007 data. In our December 31, 2007 subscriber table, Cablecom’s partner networks account for 54,800 Customer Relationships, 102,300 RGUs, 31,400 Digital Cable Subscribers, 190,000 Internet Homes Serviceable, 188,000 Telephone Homes Serviceable, 37,400 Internet Subscribers, and 33,500 Telephone Subscribers. In addition, partner networks account for 373,800 digital cable homes serviceable that are not included in Homes Passed or Two-way Homes Passed in our December 31, 2007 subscriber table. (14) Pursuant to certain agreements, Telenet offers premium video, broadband Internet and telephony services over a Telenet partner network. A partner network RGU is only recognized if Telenet has a direct billing relationship with the customer. Homes Serviceable for partner networks represent the estimated number of homes that are technologically capable of receiving the applicable service within the geographic regions covered by the Telenet partner network. In our December 31, 2007 subscriber table, Telenet’s partner network accounts for 465,800 RGUs, 823,800 Internet Homes Serviceable and Telephone Homes Serviceable, 23,800 premium video subscribers (included in our Analog Cable Subscribers), 267,200 Internet Subscribers and 174,800 Telephone Subscribers. In addition, Telenet’s partner network accounts for 823,800 Homes Passed and Two-way Homes Passed that are not included in our December 31, 2007 subscriber table. Additional General Notes to Tables: With respect to Chile, Japan and Puerto Rico, residential multiple dwelling units with a discounted pricing structure for video, broadband Internet or telephony services are counted on an EBU basis. With respect to commercial establishments, such as bars, hotels and hospitals, to which we provide video and other services primarily for the patrons of such establishments, the subscriber count is generally calculated on an EBU basis by our subsidiaries (with the exception of Telenet, which counts commercial establishments on a per connection basis). EBU is calculated by dividing the bulk price charged to accounts in an area by the most prevalent price charged to non-bulk residential customers in that market for the comparable tier of service. On a business-to-business basis, certain of our subsidiaries provide data, telephony and other services to businesses, primarily in the Netherlands, Switzerland, Austria, Ireland, Belgium and Romania. We generally do not count customers of these services as subscribers, customers or RGUs. While we take appropriate steps to ensure that subscriber statistics are presented on a consistent and accurate basis at any given balance sheet date, the variability from country to country in (i) the nature and pricing of products and services, (ii) the distribution platform, (iii) billing systems, (iv) bad debt collection experience and (v) other factors adds complexity to the subscriber counting process. We periodically review our subscriber counting policies and underlying systems to improve the accuracy and consistency of the data reported. Accordingly, we may from time to time make appropriate adjustments to our subscriber statistics based on those reviews. Subscriber information for acquired entities is preliminary and subject to adjustment until we have completed our review of such information and determined that it is presented in accordance with our policies.