LILAC Test

1. 概況: 共有270萬用戶，520萬RGUs，30%是Triple-play (同時使用3種服務)。每一季營收約在US$900mn上下，OCF約US$360mn (OCF margin約為40%)，Operating income為$150mn。公司控制Capex占營收比為20%上下。
   
   

2. Operation:
   Three company cover different regions, every region has their own demand & supply and competitive landscape in each business.
   
   >CWC- Bahamas and Panama and other Caribbean(LIME brand),
   >VTR-Chile
   >LPR-Puerto Rico
   
   We could also view LILAC as a whole and divided by business:
   
   >Fixed line voice (Telephony)
   >Broadband (Internet, FTTx)
   >Mobile
   >Video (Pay-TV)
   >B2B
   
   

3. 類比1: 中華電信
   業務同樣有: 固網(市話: fixed-line voice、寬頻: broadband)、行動(mobile)、有線電視MOD/IPTV(Video)、企客ICT服務(B2B)
   
   類比2: 台灣大
   台灣大旗下擁有有線電視系統業者(永佳樂、觀天下….)、台灣大寬頻、台灣大哥大上網，但沒有市話。另外較LILAK多了momo電子商務
   
   

4. If mgmt. is right, the EBITDA of LILAC could grow at 5-10% in the next three years with stronger increase in FCF.
   
   

5. LILAK成長的邏輯: 外生-EBITDA或OIBDA以high-single digit成長，公司會以同樣的速度增加貸款，這增加的貸款會拿去buyback share。內生-FCF(也就是完成P&E addition等資本支出及利息支出後剩下的錢，成長率為low-single digit) 也會拿去做share buyback。
   
   內生+外生: 整體share-count下降速度會達到low-teen %，強化每股EBITDA/OIBDA的成長速度，從原本的high-single digit大幅上升至20%up。
   
   

6. Risk:
   >股價上升太快→good for investor，但share-count的下降速度就會變慢，EBITDA成長就不會那麼強，市場Rating可能就不會那麼高，股價天花板會比較快看到。
   
   >貸款增加，EV也會上升，所以EV/EBITDA的倍數會自然上升，戴維斯雙擊的效應可能不會像預期的那麼強。
   
   

7. Share-Buyback: 公司計畫在2019年底總共要回購US$300mn價值的股票，1Q/2Q有提到已完成$41mn。(所以剩下保守算$250mn)。2020年我自己估計回購$150mn。假設股價上漲導致平均收回價為$30，Share-reduction =13mn share or 7.6% (2.5% annually)。保守估計OCF年化成長為5% (我是覺得沒有很保守啦……)，OCF per share will grow at 7-8%。(vs. 黑色面包的17.8% in pessimistic scenario)
   
   

8. 公司net debt為5.6bn (exclu. Minority interest in LPR and C&W), 市值為3.6bn→ EV=9.2bn
   
   

9. Company guided 2017 OCF of $1.35bn, my forecast is $1.5bn for 2018 number, suggesting EV/EBITDA (~OCF) of 6.8x/6.1x

8. Valuation通訊/媒體公司近五年市場交易(併購)乘數約8-

   10X EBITDA。

之前頂新要買中嘉，最後以中嘉EBITDA的9.5倍，約670億元成交。

早期電信三雄估值多給10X，現在溢價較高，約10~13X EBITDA。

2015年原本的LILAC要併購C&W時定價為10.7x OCF

歐美的Cable營運商目前trade在約9x 2018 OCF，不過拉
美的市場給6x而已

Some players are cheaper (and bigger) with EV/EBITDA of 4-6x. Could some of them become more attractive deals than LILAC is?

10. Bundling:

Liberty global (Europe)的Triple-play占比將近45%，(Single-play, Dual-play則分別為35-40%，15-20%)，LILAC在合併CWC之前的Triple-play占比也是超過40%，反觀new LILAC則僅有30% (同時single-pay占比43%)，代表CWC這塊還有非常大的成長空間，而管理層應該是有能力逐步提升這個比例。

11. 我覺得不錯的點: 這是一個有提價權的公司，他們在1Q和2Q都有漲價，且客戶並沒有跑掉太多。另外公司說一直有在看M&A的標地，但沒有好的物件不會盲目出手。(可能也是因為被CWC嚇到了)

12. The market LILAC serve (Carrabean, LatAm……etc.) is not a juicy, nor transparent one. In our mind, those countries have fragile economy and volatile political environment. It increases the risk. (or the risk we feel)

13. Cable business always requires heavy capex, those are huge upfront cost, but the payoff never comes to fruition immediately. (or it could be the case never get the money back)

14. The business units of LILAC are too fragmented due to the nature of the market and it’s M&A strategy. We can view it as a three groups (by markets) and the question will be “are there really synergies
    betwee
    n these groups?”

And now the cable, TV, mobile…etc. is not a monopoly business anymore. Competition is just there (The company has face severe competition in mobile in Bahamas). Moreover, time has chang
ed. Str
eaming service

maybe another threat now.

16. Threat of Nature disaster: The Hurricanes had caused a huge trouble for LPR in 2017, dampen the growth of whole LILAC. The abnormal Hurricanes could be a “Norm” in the following years. This could be a problem→2nd level thinking: 這些自然災害也會對競爭對手造成損害，而這對跨市場/跨區域、財力較厚的大公司有利(如LILAC)，因其抗風險能力較強，小的對手都死掉了那就是獨占/寡占了。

所謂ARPU就是 (ARPU-Average Revenue Per User) 表示每個用戶平均貢獻的電信業務收入。這一指標不但反映了一個國家的電信消費水準，也是電信運營業業績的重要表徵之一。ARPU注重的是一個時間段內營運商從每個用戶所得到的利潤。很明顯，高端的用戶越多，ARPU越高。在這個時間段，從營運商的營運情況來看，A R P U值高說明利潤高，這段時間效益好。

就電信業者而言，用戶數與通話量是公司獲利重要關鍵，而ARPU為其衡量的基礎之一。若果有新業者加入後，接續費

與專線租金將會有降價空間，行動通話費率也將會調降，ARPU

就會有下降的的趨勢。

Cable company 都是看 EBITDA