Press Release

Opfikon, July 29, 2022

Commenting on the results, André Krause, CEO of Sunrise, said: "We continue to operate proactively in this highly competitive market, introducing new initiatives within Q2 to sustain our commercial momentum. We achieved our most significant integration milestone yet, having completed our brand refresh and anchoring Sunrise as the main brand. We successfully launched our new 'Sunrise UP' portfolios, designed to provide greater value to all residential and business customer segments. On the strategic front, we continue to execute on our hybrid network strategy, having renewed our existing partnership with Swiss Fibre Net AG, allowing Sunrise to continue to be the only broadband provider in Switzerland that offers real giga speeds to more than 90% of Swiss households and the vast majority of businesses."

Operational results

The total net RGU gain of +57,800 broadband, TV and mobile RGUs is primarily due to the mobile postpaid growth of +47,300 mobile postpaid¹⁾ subscriptions, while the increasingly intense competitive situation in convergence offerings is having a noticeable impact on basic services in broadband and TV.

The net growth in mobile business pushed FMC penetration up to 57.0% (+1.4% YoY). With the recently launched new combination offers (Sunrise Up), Sunrise is laying the foundation for further growth through cross-selling and upselling within the mobile-subscriber customer base, and is thus even better able to meet the growing demand from customers for «one-stop shopping» offers.

As of the end of June 2022, the total figures are as follows: 2.716 million Mobile RGUs (3.117 million including second SIM cards), 1.176 million Broadband RGUs (1.234 million including SMEs) and 1.234 million TV RGUs (1.283 million including SMEs). Due to strong competition, the average revenue per user (ARPU) remains under pressure and decreased by -3.6% on a rebased basis to CHF 66.10 compared to the same period last year.

Expanded partnership of Swiss Fibre Net AG and Sunrise

Swiss Fibre Net AG (SFN) is a long-standing partner of Sunrise. Together with its partners, SFN invests in the development, construction, distribution and maintenance of state-of-the-art FTTH fiber optic networks. The two companies are now further expanding their cooperation, which will give Sunrise continued long-term usage rights (IRU) to the FTTH infrastructures of all SFN network partners in all regions of Switzerland. Thanks to the fiber optic partnerships of Sunrise, the company is able to ensure long-term independence in the biggest cities and agglomerations. On top of the powerful Sunrise HFC network, the agreement with SFN allows the company to supply residential and business customers in the vast majority of Swiss households and businesses with ultra-fast broadband products.

Sunrise Business: Solid growth

Sunrise Business managed to continue its growth course, as it did in the first quarter, and achieved a revenue increase of +1.8% with business customers in the second quarter compared to the same period last year. Numerous new contracts and renewals/upgrades of existing mandates, e.g., the University Children's Hospital Zurich, the largest center for pediatrics and pediatric surgery in Switzerland and one of the leading in the world, contributed to this outcome.

Financial results

Sunrise was able to maintain revenue²⁾ on a rebased basis stable at CHF 739.1 million (-0.3%) in Q2 2022 compared to the same period last year. Revenue was supported, in particular, by growth in the large enterprise segment among business customers and increased service revenue from residential customers in mobile business. In detail, the individual areas contributed to total revenue as follows: Consumer Mobile CHF 295.5 million (+3.6% YoY), Consumer Fixed (including Internet, TV and telephone) CHF 304.2 million (-4.6% YoY) and B2B CHF 136.4 million (+1.8% YoY).

Segment-adjusted EBITDA²⁾ remained stable on a rebased basis with an increase of +0.5% compared to the previous year and reached CHF 266.8 million, including CHF 18.9 million of costs to capture³⁾. The development of segment-adjusted EBITDA²⁾ is primarily based on MVNO and labor cost synergies. Adjusted EBITDA less P&E Additions²⁾⁴⁾ increased by +4.3% YoY on a rebased basis to a total of CHF 159.1 million; this is primarily due to increased cost discipline and, despite the negative impact of costs to capture³⁾, amounted to CHF 43.6 million.

The detailed financial results of Sunrise can be found in the UPC Holding Q2 2022 Fixed Income Release.

Sunrise as main brand & new offers

Sunrise strives to be more than just a telecommunications provider. With its brand promise «Dream Big. Do Big.», Sunrise is aiming to inspire people to make their dreams come true. Sunrise has been the main brand since May 23 and has an innovative new brand design. Sunrise is differentiating itself clearly from the competition with its new Sunrise Up offers: in particular, with fast and reliable connections thanks to the largest and fastest 5G network and the best Internet in Switzerland – offering genuine gigabit speed to over 90% of Switzerland. The same goes for the extensive and personalized entertainment offers, including the best sports and entertainment content, which provide seamless TV entertainment at home, on the go and, thanks to the Sunrise TV app, abroad as well. With Sunrise, customers get the best customer service in Switzerland. Customers are rewarded for their loyalty with unbeatable combo benefits and unforgettable experiences at sports and music events thanks to exclusive benefits from the Sunrise Moments loyalty program.

In addition, the corporate entity «Sunrise UPC LLC» has been renamed «Sunrise LLC».

Competitive advantage with IoT projects

With its IoT Starter Services, Sunrise Business has been offering preconfigured service packages for the Internet of Things (IoT) since the end of June. A total of five different service packages allow full mobile connectivity and easy data management at a professional level. The rapid pace of technical development in recent years means that IoT applications are becoming increasingly important for SMEs and IT developers. The ability to implement new IoT projects extremely quickly creates an enormous competitive advantage for Sunrise Business customers. Sunrise Business wants to promote the use of IoT solutions and provides fully configured and flexible offers at an attractive and transparent price as part of the new IoT Starter Services.

Top results with Levada

The design of the new Descente alpine ski racing suit for Swiss-Ski athletes is no longer a secret. The Swiss alpine team will start the upcoming competition season dressed in new colors and a new racing suit called «Levada». Levada is the first major milestone in the main partnership between Sunrise and Swiss-Ski. Sunrise is proud to have helped design the new racing suit and looks forward to contributing to many other top Swiss results.

More than CHF 1.5 million raised in donations for «Street Child»

«The Big Ride» is a big get-together for the Liberty Global family, with a long tradition. It has been taking place for 14 years and is for a great cause: fundraising for «Street Child» and its goal to provide support, education and protection to children and communities in sub-Saharan Africa and Asia. «The Big Ride» took place in Switzerland for the first time in June 2022. A total of 540 participants, including 200 Sunrise employees, managed to raise over CHF 1.5 million. Donations will continue to be collected for «Street Child» until September 30, 2022.

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1) including B2B and second SIM cards.

2) The results on a rebased basis are consistent with the results presented by the parent company. These non-GAAP figures are intended to supplement, and not replace, the U.S. GAAP figures contained in the financial statements of the parent company. The UPC Holding Q2 2022 Fixed Income Release should be consulted for any definitions and adjustments.

3) «costs to capture» generally include incremental, third-party operating and capital costs directly related to integration activities, restructuring measures, and certain other costs associated with aligning an acquired company with the business processes of the parent company to achieve synergies. These costs are necessary to align the operations of a business to be acquired (or a joint venture to be formed) with those of the parent company, or are associated with the acquisition. As a result, the costs to be recognized may include certain (i) operating costs included in Adjusted EBITDA, (ii) capital-related costs included in additions to property, plant and equipment and Adjusted EBITDA excluding additions to property, plant and equipment4), and (iii) certain integration-related restructuring costs not included in Adjusted EBITDA or Adjusted EBITDA excluding additions to property, plant and equipment4). As the achievement of synergies occurs over time, certain of the costs to be recognized are recurring in nature and are generally incurred within a few years of the closing of the transaction.

4) Due to a comment by the U.S. Securities and Exchange Commission SEC, Liberty Global has changed its formerly used term «OFCF» to «Adjusted EBITDA excluding additions to property, plant and equipment» as of Q3/21.

Press Release (PDF)