Debt and Capital Lease Obligations (Tables)

12 Months Ended

Dec. 31, 2018

Debt and Capital Lease Obligations [Abstract]

Schedule of Debt

The U.S. dollar equivalents of the components of our debt are as follows:

	December 31, 2018						Principal amount
	Weighted average interest rate (a)		Unused borrowing capacity (b)
			Borrowing currency		U.S. $ equivalent		December 31,
							2018		2017
VM Senior Secured Notes	5.40	%	—		$	—	$	6,268.3	$	6,565.6
VM Credit Facilities (c)	4.72	%	(d)		860.3		4,600.5		4,676.2
VM Senior Notes	5.54	%	—		—		1,999.9		3,000.1
Telenet Credit Facility	3.76	%	(e)		509.6		3,145.7		2,177.6
Telenet Senior Secured Notes	4.69	%	—		—		1,687.1		1,721.3
Telenet SPE Notes	4.88	%	—		—		546.2		937.7
UPCB SPE Notes (f)	4.54	%	—		—		2,445.5		2,582.6
UPC Holding Bank Facility (f)	4.96	%	€	990.1	1,133.9		1,645.0		2,576.1
UPC Holding Senior Notes (f)	4.59	%	—		—		1,215.5		1,313.4
Vendor financing (g)	4.18	%	—		—		3,620.3		3,593.1
ITV Collar Loan	0.90	%	—		—		1,379.6		1,463.8
Derivative-related debt instruments (h)	3.37	%	—		—		301.9		361.5
Sumitomo Share Loan (i)	—	%	—		—		—		621.7
Sumitomo Collar Loan	—	%	—		—		—		169.1
Other (j)	5.27	%	—		—		459.8		418.2
Total debt before deferred financing costs, discounts and premiums (k)	4.56	%			$	2,503.8	$	29,315.3	$	32,178.0

The following table provides a reconciliation of total debt before deferred financing costs, discounts and premiums to total debt and capital lease obligations:

	December 31,
	2018			2017
	in millions
Total debt before deferred financing costs, discounts and premiums	$	29,315.3		$	32,178.0
Deferred financing costs, discounts and premiums, net	(131.4		)	(171.8		)
Total carrying amount of debt	29,183.9			32,006.2
Capital lease obligations (l)	621.3			638.3
Total debt and capital lease obligations	29,805.2			32,644.5
Current maturities of debt and capital lease obligations	(3,615.2		)	(3,667.5		)
Long-term debt and capital lease obligations	$	26,190.0		$	28,977.0

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(a) Represents the weighted average interest rate in effect at December 31, 2018 for all borrowings outstanding pursuant to each debt instrument, including any applicable margin. The interest rates presented represent stated rates and do not include the impact of derivative instruments, deferred financing costs, original issue premiums or discounts and commitment fees, all of which affect our overall cost of borrowing. Including the effects of derivative instruments, original issue premiums

or discounts and commitment fees, but excluding the impact of deferred financing costs, our weighted average interest rate on our aggregate variable- and fixed-rate indebtedness was 4.31% at December 31, 2018. For information regarding our derivative instruments, see note 8.

(b) Unused borrowing capacity represents the maximum availability under the applicable facility at December 31, 2018 without regard to covenant compliance calculations or other conditions precedent to borrowing. At December 31, 2018, based on the most restrictive applicable leverage covenants, the full amount of unused borrowing capacity was available to be borrowed under each of the respective subsidiary facilities, and based on the most restrictive applicable leverage-based restricted payment tests, there were no restrictions on the respective subsidiary's ability to make loans or distributions from this availability to Liberty Global or its subsidiaries or other equity holders. Upon completion of the relevant December 31, 2018 compliance reporting requirements, we expect that the full amount of unused borrowing capacity will continue to be available and that there will be no restrictions with respect to loans or distributions. Our above expectations do not consider any actual or potential changes to our borrowing levels or any amounts loaned or distributed subsequent to December 31, 2018.

(c) Amounts include £41.9 million ($53.4 million) and £43.6 million ($55.6 million) at December 31, 2018 and 2017, respectively, of borrowings pursuant to excess cash facilities under the VM Credit Facilities. These borrowings are owed to certain non-consolidated special purpose financing entities that have issued notes to finance the purchase of receivables due from Virgin Media to certain other third parties for amounts that Virgin Media and its subsidiaries have vendor financed. To the extent that the proceeds from these notes exceed the amount of vendor financed receivables available to be purchased, the excess proceeds are used to fund these excess cash facilities.

(d) Unused borrowing capacity under the VM Credit Facilities relates to multi-currency revolving facilities with an aggregate maximum borrowing capacity equivalent to £675.0 million ($860.3 million). During 2018, the VM Revolving Facility was amended and split into two revolving facilities. As of December 31, 2018, VM Revolving Facility A was a multi-currency revolving facility maturing on December 31, 2021 with a maximum borrowing capacity equivalent to £50.0 million ($63.7 million), and VM Revolving Facility B was a multi-currency revolving facility maturing on January 15, 2024 with a maximum borrowing capacity equivalent to £625.0 million ($796.6 million). All other terms from the previously existing VM Revolving Facility continue to apply to the new revolving facilities.

(e) Unused borrowing capacity under the Telenet Credit Facility comprises (i) €400.0 million ($458.1 million) under Telenet Facility AG, (ii) €25.0 million ($28.6 million) under the Telenet Overdraft Facility and (iii) €20.0 million ($22.9 million) under the Telenet Revolving Facility, each of which were undrawn at December 31, 2018.

(f) Subsequent to December 31, 2018, we entered into an agreement to sell our operations in Switzerland. For information regarding the potential impact on the outstanding debt of the UPC Holding borrowing group, see note 21.

(g) Represents amounts owed pursuant to interest-bearing vendor financing arrangements that are used to finance certain of our property and equipment additions and, to a lesser extent, certain of our operating expenses. These obligations are generally due within one year and include VAT that was paid on our behalf by the vendor. Repayments of vendor financing obligations are included in repayments and repurchases of debt and capital lease obligations in our consolidated statements of cash flows.

(h) Represents amounts associated with certain derivative-related borrowing instruments, including $248.6 million and $304.9 million at December 31, 2018 and 2017, respectively, carried at fair value. These instruments mature at various dates through January 2025. For information regarding fair value hierarchies, see note 9.

(i) In August 2018, we settled the outstanding amount under the Sumitomo Share Loan with the remaining shares of Sumitomo that were held by our company.

(j) Amounts include $225.9 million and $160.9 million at December 31, 2018 and 2017, respectively, of debt collateralized by certain trade receivables of Virgin Media.

(k) As of December 31, 2018 and 2017, our debt had an estimated fair value of $28.5 billion and $32.7 billion, respectively. The estimated fair values of our debt instruments are generally determined using the average of applicable bid and ask prices

(mostly Level 1 of the fair value hierarchy) or, when quoted market prices are unavailable or not considered indicative of fair value, discounted cash flow models (mostly Level 2 of the fair value hierarchy). The discount rates used in the cash flow models are based on the market interest rates and estimated credit spreads of the applicable entity, to the extent available, and other relevant factors. For additional information regarding fair value hierarchies, see note 9.

(l)The U.S. dollar equivalents of our consolidated capital lease obligations are as follows:

	December 31,
	2018		2017
	in millions
Telenet (1)	$	475.2	$	456.1
Virgin Media	69.1		79.1
UPC Holding	29.9		35.9
Other subsidiaries	47.1		67.2
Total	$	621.3	$	638.3

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(1)

At December 31, 2018 and 2017, Telenet’s capital lease obligations included €390.6 million ($447.3 million) and €361.8 million ($414.3 million), respectively, associated with Telenet’s lease of the broadband communications network of the four associations of municipalities in Belgium, which we refer to as the pure intercommunalues or the “PICs.” All capital expenditures associated with the PICs network are initiated by Telenet, but are executed and financed by the PICs through additions to this lease that are repaid over a 15-year term. These amounts do not include Telenet’s commitment related to certain operating costs associated with the PICs network. For additional information regarding this commitment, see note 18.

Maturities of Debt and Capital Lease Obligations

Maturities of our debt and capital lease obligations as of December 31, 2018 are presented below for the named entity and its subsidiaries, unless otherwise noted. Amounts presented below represent U.S. dollar equivalents based on December 31, 2018 exchange rates:

Debt:

	Virgin Media			UPC Holding (a)			Telenet (b)			Other			Total
	in millions
Year ending December 31:
2019	$	2,454.2		$	587.4		$	440.9		$	55.0		$	3,537.5
2020	15.7			24.3			16.9			212.9			269.8
2021	1,320.7			25.4			12.0			962.1			2,320.2
2022	314.1			24.1			11.9			323.2			673.3
2023	75.3			21.3			12.1			—			108.7
Thereafter	11,629.4			5,306.0			5,470.4			—			22,405.8
Total debt maturities	15,809.4			5,988.5			5,964.2			1,553.2			29,315.3
Deferred financing costs, discounts and premiums, net	(38.1		)	(39.3		)	(34.2		)	(19.8		)	(131.4		)
Total debt	$	15,771.3		$	5,949.2		$	5,930.0		$	1,533.4		$	29,183.9
Current portion	$	2,454.2		$	587.4		$	440.9		$	54.5		$	3,537.0
Noncurrent portion	$	13,317.1		$	5,361.8		$	5,489.1		$	1,478.9		$	25,646.9

 

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(a) Amounts include the UPCB SPE Notes issued by the UPCB SPEs. As described above, the UPCB SPEs are consolidated by UPC Holding and Liberty Global.

(b) Amounts include the Telenet SPE Notes issued by the Telenet SPEs. As described above, the Telenet SPEs are consolidated by Telenet and Liberty Global.

Capital lease obligations:

		Telenet			Virgin Media			UPC Holding			Other			Total
	in millions
Year ending December 31:
2019		$	66.9		$	12.3		$	4.9		$	17.3		$	101.4
2020		82.3			9.3			6.1			9.6			107.3
2021		76.4			8.9			6.3			5.1			96.7
2022		76.1			11.2			4.1			3.1			94.5
2023		64.4			6.9			3.9			18.3			93.5
Thereafter		277.6			172.8			13.6			—			464.0
Total principal and interest payments		643.7			221.4			38.9			53.4			957.4
Amounts representing interest		(168.5		)	(152.3		)	(9.0		)	(6.3		)	(336.1		)
Present value of net minimum lease payments		$	475.2		$	69.1		$	29.9		$	47.1		$	621.3
Current portion		$	52.6		$	7.3		$	3.0		$	15.3		$	78.2
Noncurrent portion		$	422.6		$	61.8		$	26.9		$	31.8		$	543.1