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Liberty Interactive's CEO Discusses Q2 2012 Results - Earnings Call Transcript

Gregory Maffei

Thank you, Courtnee, and good morning to all of you. Today speaking on the call besides myself we’ll have Liberty’s CFO Chris Shean, QVC’s CEO Mike George and QVC U.S. CEO Claire Watts. On to our highlights.

At QVC, we had very solid results, especially in the U.S. and Japan. A little weaker in Germany, but overall quite solid. We’re very pleased with, we received government approval in China and finalized our joint venture with China National Radio, and are investing in that partnership. We also raised $500 million in a 10-year senior secured note at very favorable terms, 5 1/8, and set the capital structure at QVC at an even more solid footing.

We do note that in the marketplace, there have been several recent transactions with international video commerce companies, which point to very favorable multiples. Bain Capital agreed to buy 50% of Jupiter Shop Channel in Japan. Providence Equity Partners is purchasing a majority of HSE 24 Video Shopping Channel, based in Germany, with operations in Germany, Italy, Austria and Switzerland. There’s limited financial information available on how these private companies are doing, but what we can glean suggests that the EBITDA multiples are well in excess of what LINTA is trading at today.

Later this morning, we’re going to have a vote of the shareholders of LINTA, that will create Liberty Ventures, if the vote is affirmative as we expect. Liberty Ventures will begin trading on Friday. We’re quite excited for this, as we hope it will highlight the strong operations of our digital commerce companies attributed to the new Liberty Interactive tracking stock group, and we will increase shareholder value thereby.

I’d also note that during the quarter, we made significant repurchases of our shares, buying back $257 million of LINTA stock, even though we were out of the market for all of July due to having a proxy out.

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