Lumen Technologies, Inc. · NYSE:LUMN
Lumen Technologies — CenturyLink — Q3 2017 Earnings Presentation
17 slides from Lumen Technologies's earnings presentation, Nov 8, 2017
Slide 1: 3rd Quarter 2017 Earnings Results
3rd Quarter 2017 Earnings Results November 8, 2017 © 2015 CenturyLink. All Rights Reserved.
Slide 2: Forward-Looking Statements
Forward-Looking Statements Except for historical and factual information, the matters set forth in this presentation and other of our oral or written statements identified by words such as “estimates,” “expects,” “anticipates,” “believes,” “plans,” “intends,” and similar expressions are forward-look
Slide 3: Non-GAAP Measures
Non-GAAP Measures This presentation includes certain non-GAAP historical and forward-looking financial measures, including but not limited to adjusted EBITDA, adjusted free cash flow, core revenues, adjusted net income, adjusted diluted EPS and adjustments to GAAP measures to exclude the effect of s
Slide 4: Participants
Participants Glen Post Chief Executive Officer Jeff Storey President & Chief Operating Officer Stewart Ewing Executive Vice President Sunit Patel Executive Vice President & Chief Financial Officer 4 © 2015 CenturyLink. All Rights Reserved.
Slide 5: Strategic Overview
Strategic Overview Glen Post Chief Executive Officer © 2015 CenturyLink. All Rights Reserved.
Slide 6: Building a New CenturyLink
Building a New CenturyLink + = A new CenturyLink Compelling, Strategic Combination ▪ Complementary networks and product portfolios ▪ Broader range of services and solutions for customers ▪ Intense focus on customer experience ▪ Increased opportunities for employees © 2015 CenturyLink. All Rights Res
Slide 7: Positioned to Drive Value
Positioned to Drive Value ~450,000 Route Miles of Fiber Globally • Compelling set of assets 100,000+ On-Net buildings • Enhanced scale • Drive operational efficiency and profitable growth Serve customers in 60+ Countries • Generate meaningful Adjusted EBITDA and Free Cash Flow growth 5.8 Million Bro
Slide 8: Integration Update
Integration Update • Integration is underway and on track • Expect full integration of sales team in 1Q18 and ERP system in 2Q18; additional system and process changes on-going • Anticipate majority of integration activities to be completed within three years • Confident in ability to achieve operat
Slide 9: 3Q17 Results - CenturyLink
3Q17 Results - CenturyLink Stewart Ewing Executive Vice President © 2015 CenturyLink. All Rights Reserved.
Slide 10: CenturyLink 3Q17 Financial Summary
CenturyLink 3Q17 Financial Summary • $4.0 billion in Total revenue Core Revenue ($B)(4) • $3.60 billion Core revenue1, 8.1% Y/Y decrease from 3Q16; Adjusting for the $3.77 Colo Sale effective May 1, 2017, core $3.60 revenue declined 4.5% Y/Y • $1.89 billion Strategic revenue2, 6.7% $1.89 $1.71 Y/Y d
Slide 11: CenturyLink Enterprise Segment
CenturyLink Enterprise Segment Enterprise - Operating Revenue(2) $ in millions Enterprise Strategic $2,294 Revenue ($MM) 3Q17 3Q16 % Chg $2,171 Data $161 High-bandwidth data Integration $130 services $767 $744 3.1% Legacy Other strategic (primarily $1,205 $1,092 colocation & broadband) 182 334 (45.5
Slide 12: CenturyLink Consumer Segment
CenturyLink Consumer Segment Consumer - Operating Revenue Other Legacy $ in millions services; 5% $1,472 $1,387 Broadband services; 49% Legacy $683 $613 Legacy voice services; 39% Strategic $789 $774 Other Strategic services; 7% 3Q16 3Q17 • Total revenue decline of 5.8% Y/Y ◦ Strategic revenue decre
Slide 13: 3Q17 Results - Level 3
3Q17 Results - Level 3 Jeff Storey CenturyLink President & Chief Operating Officer Sunit Patel CenturyLink Executive Vice President & Chief Financial Officer © 2015 CenturyLink. All Rights Reserved.
Slide 14: Level 3 3Q17 Highlights
Level 3 3Q17 Highlights • Grew Adjusted EBITDA(1)(2) to $752 million in the quarter • Expanded Adjusted EBITDA Margin(1)(2) to 36.5% • Generated Free Cash Flow(1)(2) of $379 million • Reaffirmed full-year 2017 outlook for Adjusted EBITDA and Free Cash Flow (1) See schedule of non-GAAP metrics for de
Slide 15: Level 3 CNS Revenue
Level 3 CNS Revenue 3Q17 CNS Revenue Performance Constant As Reported CNS Revenue Revenue Currency Y/Y % $ in millions Y/Y % Total CNS 1.5% 1.8% Enterprise 3.1% 3.2% $1,963 $1,929 Wholesale (2.8)% (2.2)% North America 1.5% 1.5% Enterprise 2.8% 2.8% Wholesale (1.9)% (1.9)% EMEA 0.5% 2.2% Enterprise 5
Slide 16: Level 3 Adjusted EBITDA & Free Cash Flow
Level 3 Adjusted EBITDA & Free Cash Flow Adjusted EBITDA(1) (2) Free Cash Flow(1) (2) $ in millions $ in millions $752 $716 36.5% $379 35.2% $281 3Q16 3Q17 3Q16 3Q17 Adjusted EBITDA Adjusted EBITDA Margin Net Debt to LTM Adjusted EBITDA(3) Leverage 2.9x (1) See schedule of non-GAAP metrics for defin
Slide 17: Q&A
Q&A © 2015 CenturyLink. All Rights Reserved.