Grupo Televisa, S.A.B. (NYSE:TV) Q3 2024 Earnings Conference Call October 25, 2024 11:00 AM ET

Company Participants

Alfonso de Angoitia - Co-Chief Executive Officer
Francisco Valim - Chief Executive Officer, Cable & Sky
Carlos Phillips - Chief Financial Officer

Conference Call Participants

Marcelo Santos - JPMorgan
Vitor Tomita - Goldman Sachs
Phani Kanumuri - HSBC
Carlos de Legarreta - Itau
Matthew Harrigan - Benchmark

Operator

Good morning, everyone, and welcome to Grupo Televisa's Third Quarter 2024 Conference Call.

Before we begin, I would like to draw your attention to the press release, which explains the use of forward-looking statements and applies to everything that we discuss in today's call and in the earnings release.

I’ll now turn the call over to Mr. Alfonso de Angoitia, Co-Chief Executive Officer of Grupo Televisa. Please go ahead, sir.

Alfonso de Angoitia

Thank you, Elsa. Good morning, everyone, and thank you for joining us. With me today are Francisco Valim, CEO of Cable and Sky; and Carlos Phillips, CFO of Grupo Televisa.

Before discussing our third quarter operating and financial performance, let me share with you what we believe are the key milestones achieved so far this year, both at Grupo Televisa and TelevisaUnivision.

First, the corporate restructuring process at our Cable segment intended to improve profitability, optimize CapEx, increase free cash flow generation and position us well to achieve sustainable revenue growth over the coming years is already delivering results. The measures implemented so far have allowed us to improve profitability by almost 400 basis points to 39.4% relative to the third quarter of 2023 as we are confident that our Cable EBITDA margin will continue to expand gradually over the coming years due to ongoing efficiencies.

Regarding CapEx optimization, our year-to-date cable investments of almost $290 million have declined by around 38% year-on-year, while our Cable CapEx to sales ratio of 14.4% is over 800 basis points lower than that of the same period of 2023. This streamlining and cable investments has been driven by a more disciplined subscriber acquisition approach, focused on value customers and a more efficient and rational expansion of our fiber network.

During the first nine months of the year, operating cash flow from our cable segment, which is equivalent to EBITDA minus CapEx was over MXN8.8 billion, growing by almost 40% year-on-year and accounting for around 25% of sales. This implies that the operating cash flow margin for our Cable segment has increased by 750 basis points so far this year.