Q2 2021 Quebecor Inc Earnings Call
The conference is now being recorded.
Yeah.
Good morning, ladies and gentlemen, thank you for standing by and welcome to the Cabot Corp, Inc. Financial results for the second quarter 2021 and I would like to introduce you see not chief financial Officer of cubic Inc. Please go ahead.
Ladies and gentlemen, and welcome to the Quebec Corps Conference call. My name is ex smell and I'm, the CFO and joining me to discuss our financial and operating results for the second quarter of 2021 is our president and Chief Executive Officer.
And you want and unable to attend the conference call will be able to listen to a recording by telephone or webcast access details are available and that of course website and triple W. Quebec word dot com.
The recording will be available until November 14.
And I also want to inform you that certain statements made on the call today may be considered forward looking and we would refer you to the risk factors outlined in today's press release and reports filed by the corporation with regulatory authorities.
And I'll turn it to Jack.
[noise] nephew and good morning, everyone.
Before turning to our operational and financial results I would like to briefly come back to our discussion last week and further to the conclusion of the 2500 megahertz auction.
As I stated then and we are.
And very pleased to have won significant ban and strategically important and valuable spectrum, both in Quebec and also in our key regions, Ontario, Manitoba.
BARDA and British Columbia.
And the outcome of this auction is for US the first essential step towards the expansion of our telecom services outside of our own base of Quebec in 2 key markets of Ontario, and Western Canada, where we believe we are uniquely qualified to our operational track record.
Innovative approach and solid balance sheet to succeed and providing Canadians with well price technologically superior telecom services always inline and evolving with their needs and expectations.
In terms of the next steps and it is important that the.
Regulatory authorities and make good on their recently announced decision and then they deem appropriate framework, whereby efficient and timely and negotiation can be concluded and thus and sure that MTN all become a true alternative to encourage and.
And competition in Canada.
Specifically as it was no doubt the CIBC objective and.
This recent decision.
Telecom regulatory policy too I was in 'twenty 1.
Last 130.
And to foster and encourage competition and the wireless market. It is important to highlight once again.
And the difficulties, we had 4 years to access the infrastructure owned by Bell to accelerate the deployment of high speed Internet and our Quebec market CRE.
CRT Sea intervention was ultimately required to force belt to give access to and its infrastructure on a reasonable terms and so this year and TCE should thus be proactive this time around and impulse as quickly as possible and specific regulation for.
Wireless network access to achieve the policy objective.
Now I'll review our.
Operational results starting with telecom.
Over the past few weeks.
I've had the pleasure of traveling across go back to announce to the residents of several or rural areas that we are very pleased to some be able to offer connectivity to their own and neighborhoods.
That said, our project and deliver speed Internet, and 37000 households, and the municipality and needs.
To be more disease, and buffet and Uh huh.
<unk> non shallow water.
Net loss is.
Yes.
Let's go now to name a few is well underway again I wish to salute our teams and partners who have taken up the challenge of connecting those owned by September of next year.
And as a result of this project, we will essentially be doubling the average out and put a break in momentum.
Jermaine 'twenty.
2022.
Starting with our wireline segment, we're pleased with our performance this quarter, especially considering the accentuated seasonal impact resulting from the connect moving period absurd in Q2 this year.
Ever it adds.
And then the case for many years due to this unique moving situation and go back and the third quarter has started on a very positive note in terms of volume growth.
For our fourth consecutive quarter, we added over 100000 and customers to our services, bringing our total to 922000 RG use as of June 30 and 20.
<unk> 21, and less than 2 years more than a third of our customer base and subscribe to benefit from our analytics platform and all of its superior functionality.
As we continue to develop our Alex experience. We are pleased to announce that we have signed new deals with digital media and zone at Phi to integrate content to the index kept at all.
And also recently introduced Super 2 hour Alex Black.
Furthermore, and.
And it's self installation.
Large and March is being widely adopted is close to 2 thirds of our customers now off for this option to initiate their services we have.
<unk> already surpassed 100000 self installation and since the launch with a 90% overall customer satisfaction rate this program and proven very successful.
Solid broadband growth continue to our fit and Brent which offer a unique consumer experience that allows us to differentiate ourselves from competitors.
Despite the dilutive impact of fixed broadband pricing, we posted a 5% or $2.73 consolidated internet art from growth.
On the wireless front, we posted 27000, new adds during the quarter and a more competitive environment than last year.
Let's keep in mind that last year, we capitalize on the fact that we were out of the gate better prepare than all of our peers do welcome back customers and our retail stores.
Once again this quarter, we've captured on a combined basis, the largest share of gross adds and Quebec and despite that our competitors continuing to be aggressive, especially towards the end of the quarter.
Wireless.
<unk> was essentially flat for the quarter with both the FID and if you do a tall separate absolute increasing and is been the case for several quarters and improving due to a slight uptick in roaming and greater value per equipment and most importantly fifth art.
And growing faster compared to the last quarters.
Do you do with all launched its equipment installment plan E. IP model in mid June and strengthening our marketing strategies and addressing evolving customer needs.
So far we are pleased with the customers' adoption to our new model.
As expected, we experienced some learning curve issues relating to our sales channels. During the initial weeks following the launch but they have since been resolved.
Furthermore, in line with Ah, Quebec, or and if you do it from a strategic vision and focus on continuous C meeting and the expectation of today's consumers.
We will shortly be launching venture debt.
And video subscription platform dedicated to exclusive unscripted lifestyle documentary and entertainment content.
And the promise is to offer 1000 and hours of all fresh on demand content, including over 41st run exclusive original and Quebec Productions.
We also commit to offer over 100 original and get back to production by the end of 2022.
Along with the success of <unk> go which is dedicated to series movies and youth program and this new platform will nicely complement our content offering.
With the addition of a.
And make our strengthening its leadership position and the largest catalyst for original productions and Quebec.
We are expanding our collaboration with local producers and we will continue to invest significantly and the production of new local content.
Turning to media.
We are very pleased with our result, and this second quarter and.
And activities came back on stream.
Leading to a significant increase in advertising revenues and TV both for at the television network and our specialty channel as well as and newspapers and out of home DVR.
D Var group and don't hold your market share was 42, 6% COVID-19.
And to be the reference and television and connects.
The DVR small specialty channel sit out and without exception all the 5 point market share growth, mainly because of the Montreal Canadians and strong performance and the National Hockey League playoffs.
And in production and audio visual services now studios are also operating at full stream again, and where we're really pleased to announce the construction of NAV for which will increase the size of our studios by more than 106.100 and <unk>.
60000 square feet, making matters, even more attractive to foreign producers of blockbusters and TV series.
Speaking of media and I feel compelled to repeat that in order to ensure the.
The sustainability of our advertising revenue and the vitality of our competitiveness on local news media in the face of global competition. It is more urgent than ever.
And then the federal government legislated to enable Canadian breath publishers to negotiate and collectively with the web Giants to obtain fair compensation for the use of their content.
Canadian arrogance concur with disposition, which we have been defending for years.
It is time for the government to payable that bill.
And to establish a framework that enables newspaper publishers to negotiate on a level playing field.
We need that stand together, if we are to secure the future of news coverage and Quebec and Canada.
Finally.
Turning to our sports and entertainment operation activities remain muted this quarter, but we are busily planning the gradual and assumption of events with a full calendar lending up and sports and music for the fall and winter and will now lead you.
You can review, our telecom and consolidated and that's what results.
Yes, the debt count.
And by of course revenues were up 13% and the quarter to $1, 1.3 billion.
Revenues from our Telecom segment grew 7% to $928 million driven by equipment revenue as well as wireless and wireline services.
Revenues from our media segment grew 49% to $198 million go backwards EBITDA was up 5% to $501 million. Our telecom segment recorded EBITDA growth of 4% to 482 million and represents a 52% margin still the highest and Canadian telecom.
And despite heavier equipment loading and greater sales and marketing expenses, our media segment reported an EBITDA of $17 million and $9 million increase.
We reported a net income attributable to shareholders of 124 million and the quarter or 50 cents per share compared to a net income of <unk> 175 million or 69 cents per share reported and the same quarter last year.
The decrease is mainly explained by an unfavorable variance related to debt refinancing.
Adjusted income from continuing operations, excluding unusual items or gains or losses on valuation of financial instruments came in it and $158 million or <unk> 65 per share.
<unk>, 2 and adjusted income of 145 million or 57 cents per share and the same quarter last year.
For the first 6 months of the year.
<unk> revenues were up 8% to 202, $2.222 billion after 6 months and EBITDA was up 5% and 954 million.
Revenues from our Telecom segment grew 6% and that period.
And $1.84 billion.
After 6.
So I come Capex spending increased 8% or $11 million and the quarter as a result of a heavier ramp up and the LTE advanced and find your rollout plan leading to a wireless uptick.
And capex of $18 million.
Our cash flow from operations for the second quarter of 2021 increased by $12 million or 4% to $338 million once again, demonstrating the resilience and strength of our business model.
Our financial profitability propelled by the strong returns from our telecom segment remains very solid.
Cash flow from operations for our Telecom segment grew $7 million to $330 million.
And at the end of the quarter, our net debt to EBITDA ratio was 271 times down from 275 times reported net at the end of the second quarter last year and 1 of the lowest of all our telecom peers.
I would like to point out and the success of our recent refinancing exercise.
And we're videotron and issued $750 million of senior unsecured notes and the Canadian market and $500 million of senior unsecured notes and the U S market, both yielding a 3 and 5.8% pro forma net redemptions of videotron, and 5% senior notes and Quebec, where media is 6 and 5.8 senior notes and <unk>.
July our available liquidity of $2.4 billion provide us with much flexibility to continue our investments and strategically important growth projects, while maintaining a balanced approach to M&A.
During the first 6 months of the year, we purchased and canceled and $4.1 million class B shares for a total investment of $132 million.
Since we initiated our and CIB 10 years ago, approximately $44.7 million class B shares had been repurchased and cancelled please.
Please note that the board of directors upon termination of the August 2020 program has approved the renewal of the program for an additional year.
I will now turn it back to the accounts where their conclusion.
And then.
In conclusion, we're pleased with our operating and financial results for the second quarter as we continued to deliver steady and disciplined growth and revenues profitability and cash flow and.
Along with 1 of the strongest balance sheet and the industry, we are well positioned to play a central role and a major expected evolution of our telecom and competitive dynamics over the next few months.
Our track record speak for itself and we intend to continue to make our and Mark as the 1 of the best managed and most innovative and telecommunications company in Canada.
We thank you for your attention and we will now open lines for questions.
Of course, so just to remind everyone to ask a question you can press star 1.
And at any point and our first question comes from and you don't do drawing from dish out and bank. Please go ahead gentlemen.
And I see yeah, but until that day.
The first the first Ah congrats on the results, we saw strength and telecom revenues, but maybe margins, where we're a bit lower than than I expected and I'm wondering what's the role of the deployment the helix and that situation given the the royalty there and should we expect.
A continue debt and back from from that going forward as a as a percentage of clients are on helix has ramped up.
Thanks for the question.
And yeah, we believe we've talked about that in the past and of course, the the helix models and slightly different from you know with a pure capex and a little bit more opex. So that that does and obviously have oh and ongoing impact on the margin.
But it's a but you know at this I mean, most of the impact this quarter has to do with the equipment the increase and equipment sales on the top line, where margins are slightly lower as I'm sure you understand and and I'm, a little bit more investments and and and marketing and advertising.
And.
And then with adds you have them all so that as I mentioned and in my script is.
And he's a self installation and.
Feature, which obviously provides a true the continuation of our deployment.
<unk> expenses and reduced operational expenses, so it looks promising.
Great and then and terms of wireless software and.
Some people are looking for for growth sectors.
And where do you see your market share going eventually and maybe in the medium to long term.
So the market share for wireless and Quebec.
Well, what we can say right now is that and our.
Gross adds are favorable to the rest of the different operators or the rest of the other brands also because as you know and you know we operate 2.2 brands and we I think they're fulfilling well the different segments and.
We will continue to be aggressive, where we work and continue to be innovative and.
And we look forward to at least maintain our market share and and even growing.
Thank you.
Yeah.
Alright. Our next question comes from drew Mcreynolds from RBC. Please go ahead drew.
Yes, thanks, and thanks, very much and good morning.
Just a couple from me in terms of the.
Sequential improvement.
And year over year wireless add to or aren't too and <unk>.
Talked and your your opening remarks that there are those dynamics I just want to confirm there's nothing necessarily unusual and in the quarter that we should account for.
And then secondly, with respect to Q3 and nice to see let's.
The seasonal pick up in terms of you know activity.
And moving season, just wondering when you look at that moving season, this year versus last year as well.
What you anticipate on our back to school.
Season, how close to we are we to a to a normalized Q3 from your perspective. Thank you.
I'll start with the second question and defending its EBIT the the last day of the quarter and.
This is why you know we are we consider that and then we and we always talk you know and our conference calls you do about that the first experience of the 2 weeks and <unk>.
After the the are critical in July for day, and as I mentioned and you know what we've been seeing is a very positive and from there back to school.
There are coming in.
Shortly and and slowly and we are well prepared and have to have a are interesting and program in terms of the different services that we were able and we will continue to provide obviously you know we were talking about the wireless and Internet access and but also when you know with Alex which is providing also of interest.
<unk> and.
Product.
Looking forward and maybe for the year for this part of it.
Yeah, the and Pugh drew and nothing to specifically answer your question Ivy and that nothing unusual it's and so what we've said and I mean, it's a you know and there's a slight little bit more roaming a little bit more equipment or value per per equipment and mostly both of our you know both of our brands I'm, you know moving up and.
And with fear is moving up a little bit comparatively more so picking up vessel and not having such a dilutive effect as it has had for a for a number of quarters.
And I think that's good news.
Thank you.
Yeah.
Alright and <unk>.
Next question comes from Pratique IRA wall from Canaccord Genuity. Please go ahead.
Yeah, Hi, Thanks for taking my question. So congrats on the good quarter. My first question is on wireless revenue growth was solid at 9 and 5%. This quarter, how should we think about the EBITDA growth. This quarter and then a quick 1 on the Internet revenues as you mentioned.
Cuba called Gen weighted meaningfully higher odd ball and internet. Despite the fios broadband if you could just give us some color as to what is driving that and how should we think about debt going forward.
Okay. Good morning, Patrick a big Bill will give you details.
On the on the wireless.
And wireless EBITDA growth I mean, we're it's not something that we are that we that we give out a project because as I'm sure. You are and you know, but you know we're well you know we're well you know were well and and the you know and the high teens, So I'm I think nothing.
I think it is continuing on its path and it's been on for quite some time as we continue to grow our profitability and our margins and and and wireless.
In terms of you asked that question and to your second question has to do with with Internet revenues.
Revenues and it was specifically what sorry, a project can you.
Yeah, So Cuba called Gen weighted higher ARPA and Internet. Despite like you mentioned fios broadband and so just wanted to understand as to what is driving down and hopefully I didn't.
Think about debt going forward.
Yeah.
First you know first point. This is the first full quarter of annual increases.
And also our most important but more importantly, you know continuing to see more customers upgrading to higher and higher and higher a higher speeds as well. So so that that was mostly the and the reason behind our 9% Internet revenue growth.
Awesome, Thanks, a lot.
Alright, and next question comes from Vince Valentini from TD Securities. Please go ahead, yes.
Yes, thanks, very much a question maybe more from pure college now that you've been more and the president and chief for for a couple months now any big picture thoughts from your perspective on the competitive environment and in both so your your cable business and in the wireless business and your thoughts about the balance of.
Pricing versus market share gains going forward or are you happy with what and.
And what the company's doing currently Theres any.
Tweaks to that model that you might be thinking about.
Well, yeah. Thanks Vince.
Well you know what I think we and.
Yeah, there, there's a changing environment, but not completely I mean.
And that has been always competitive civic and are always you know and provide the full competition on the wireless side with our you know many brands and more granular than elsewhere.
As we all know and you know this is where we can get the cheapest price.
For wireless Yeah, and you know with the also need the PPI component.
Which is probably a more.
Largely oh available and Quebec with many companies and you know we have been also seeing highly competitive prices and the the internet access market.
I was just watching this morning prices and you know and Toronto or for let's say, a 150 megabyte and it's going to cost and you know close to $90, where you can go out and that Guy and who are close to that product for 50 Bucks.
And in Montreal, and Quebec, So it remains very competitive and it will continue to be competitive and therefore, we need to and they continue to differentiate ourselves with the with customer service, which we are you know for the last 20 years I've been.
Involved in to continue to launch a.
New products are Alex and been there you know to continue to offer a positive perspective and to continue to highlight our convergence play and I was referring to and you know what a new streaming service that we will launch shortly so all of those are.
And our capacity to continue to be strong, but we need also to be a slick operator.
Cary and on and the amount of money that we're spending being sometimes more and detail them. So it's business as usual I would say to you, though there is nothing completely new we had been used to that and we will continue to succeed in and and and a more competitive environment and elsewhere.
And Canada.
Thanks for that a couple of other smaller.
And maybe clarification type questions and I know you said you are number 1 and gross add share and wireless again this quarter, but are you willing to give us that figure again or did I Miss message and your opening remarks.
No we didn't get that figure, but and you know 30 year do we get that that's already at 30%.
I think it's altogether and 30% of the of the gross adds this quarter. Okay. Thank you and.
And another clarification that the new rate service is that a subscription service or advertising driven and is it 1 and and startup costs borne by by videotron or or is it through your broadcasting company TBA.
And it's a subscription service.
And if you were to take also and you go and you have a bundle of better pricing and and the model that we've been using is a model that has been successful and the bad I mean, you know the first window a broadcasting go non streaming service and the additional windows, if any and we will.
So on the different channel that we operate with D var, either on the specialty channels are either on the main network you know a few months or years. Later, so we're not going to tell you and you know how we break down the price it but you can imagine that auditors goes treated this operation on the.
On a.
Steady basis.
Okay and.
And that's 1.
Probably for Hugh Zone.
The operating cost run rate within the telecommunications segment.
Excluding wireless handsets, which which I know bounce around from quarter to quarter, depending on volumes and.
And promotions.
The base operating costs beyond that are we at a kind of a new normal run rate and the second quarter, where all of the sort of pandemic impacts of reverse themselves out or is there another potential step up and operating caution and the second half of the year as you continue to have more normal employee costs and and retail store caution.
And other things.
No I think there'll be there'll be puts and takes are Vince, but I think were looking at and improving and there was some you know some.
And some higher investments and a and a number of areas and this quarter and I think I think we may be looking at and they are at a slightly at a slightly lower.
And the Opex going forward.
So no no step up maybe you can get better and that's really idea and 1 last 1 and was there anything unusual in Q3 that we need to.
Think about in terms of 1 time revenue and onetime costs related to regulatory or other settlement issue.
Yes, we had a we had a 1 time adjustment last year of day was yes.
Yeah.
We will get into that but Ah yeah. There was a onetime adjustments last year about slightly and and then and the teens of millions of dollars from my from what I remember.
And 1 time benefit not a not a headwind from 1 time benefits exactly yes, yes.
Okay excellent. Thank you.
Thanks.
Alright, our next question comes from Matthew Griffiths from.
Back of.
Montreal. Please go ahead Matthew.
And then or change my player and Bank of America Bank of America, I'm, sorry, I apologize yeah, no no problem at all and thanks for taking the question.
And I just wanted to ask a question on wireless a b Y O D and the past and then something that you guys have talked about and I'm with the introduction of VIP and I was wondering if you could talk about maybe how that percentage both up maybe gross adds or perhaps of the base is.
<unk> and then just to piggy back on the margin questions asked earlier, if we should think of a change and that mix impacting margins and the telecom sector as a segment.
Thanks, Matt.
No on the on the margin and I think I think my answer there is nothing I wouldn't add anything to my eyes. If I go to my previous answer I wouldn't expect any and.
Any major a major major further impact going forward.
And your first question.
And I'll give you a Y O D.
And you know this is something that's been highly successful for us for from it for for many years. It continues and continues to be as you know as we said in the past you know the important part of the a b Y O D is to make sure that and all that you are there because at some point.
And you know you you you may or you will have to you know to transition your customer from a b Y O D model to a.
And we subscription or 2 and the IP or to some other models. So it's important for us and.
And to remain very very close to that and I think our churn numbers or are you know our and demonstrating that that we have and now we have a you know we offer you know all of the various models and are having been able to you know to.
And to be successful at offering them to our customers and what they want and being able to migrate them from a from the.
And <unk> model, that's at that similar margin for us, which is interesting and moving them up to it and to other models and and continuing on the margin basis, So and as you know Matt.
And our fifth brand is 100 per cent, b y and Z and so and with the.
And the.
The <unk>.
Since it's coupled with and digital model and you can't imagine that you know the cost of acquisitions or.
It is very low compared to our you know when you are delivering and.
The cost of acquisition cash wise.
In terms of getting at the.
The latest iPhone, indeed, and other customers. So the capacity of offering your own. Many possibilities are many scenarios is a positive news the other day and backing our capacity need to get the new customers.
Okay, great. Thanks, and maybe just a quick follow up.
Don't know if it was said earlier, but did you guys give the wireless churn and the wireless capex numbers for the quarter.
NAV maybe.
Maybe we have or not but our wireless churn with was slightly and.
Slightly higher than last year of course, but you know I think we've talked about this last year was a very unusual year with much.
And with much fewer port outs.
But sequentially better than that and and on and on Q1.
And $1, 1% to 1% or something of that sort of we didn't give it out but it's 1% right. Yeah..1 per cent looking at my number and get back to your second question was with our wireless Capex right yes.
Capex was.
100 and.
And we give it out.
And as human with a number of the wireless Capex was for the quarter and was 48.48 billion for the quarter.
Great. Thanks, so much.
Alright and.
And next we have a question from David and Mike <unk> from core Mark capital.
Please go ahead David.
Hi, Yeah, a couple of questions.
Looking at the wireless adds to you on the past.
Declining a little bit and this quarter and was flat on a year over year base and so I was just wondering.
Whats changed whats driving that and I know you'd mentioned that slight uptick and roaming, but I imagine that wouldn't really be the factor. There is it is.
Is it just more data consumption and our people moving up to higher price plans and he can give us any color on that that'd be helpful.
Yeah on the on that day, but yeah, a little bit of roaming we said, but not the main thing I mean.
And and a little bit of a of a higher value of equipment, you know per per unit of equipment, but it's mostly it's mostly people and and fit and in both brands actually to be honest, you know moving up and and really increasing our views and both of our brands and.
And importantly fit is a comparatively moving up or increasing a little bit more so having less dilutive impact.
But what is it what is that price increases are just people deciding to go from like a higher price play and more Dana.
No I mean people know that there's a view out there there's a.
A couple of things I mean, as we said there was no roaming decline. Okay. That's the first thing and secondly people are just moving up to the higher packages and and I'm, just having a and average service spend a little bit higher and and continuing to be higher and the corner.
Okay, and then just on them.
And the Quebec and wireless gross adds you know when you look at.
And net adds there I mean, you know there's still very good they're just down a little back from what they used to be previously and so I'm just wondering yeah, and Quebec wireless market growth is maybe slowing a little bit is that are you seeing that well. It's it's you know I.
And I think the comment and you know, okay and I commented on that I mean, it's a very competitive market. They know we're hearing that.
That English, Canada, Ontario, and more specifically you had been a little bit less competitive I mean here you know we have to fight we have to fight for these things and and.
And you know its at a switching from year to year last year's switching and port outs.
And switching was was down and now.
Now as you know is back up and.
People are increasingly focusing on price and.
And I think we've got the right tools and you know that being said to your debt.
And to really offer them when theyre looking for but but it is a market where you know you know building and net new adds is is is it's not easy and certainly compared to.
Last year and it's a it's a market that continues to be a to be comparatively more competitive and.
And then the rest of the country and.
And we've launched a VIP, which is also at the beginning as we said you know, it's just starting out and so we haven't I think reached full steam on that 1 and I think this will provide us a.
A little bit more a little bit more momentum there and you know with 30% share of gross adds and and our 2 brands are being you know rightly positioned in terms of pricing and promotions and you know we think you know us.
And I mentioned earlier that we've got all the right tools and all the right strategies to continue to be successful and that and that you know, but it has to be said highly competitive market.
Okay.
Alright. Thanks.
Okay.
Alright, and the last question and we currently have and the queue comes from Jeff fan from Scotiabank. Please go ahead Jeff.
Thank you and good morning.
Just wanted to follow up on the Capex got the wireless Capex question.
And maybe ask about.
And what the breakdown is if you have that roughly between what you would consider maintenance type capex.
5 G I'm not not really just for the quarter, but maybe since you started your 5 G. Capex just curious what the rough breakdown and compete in top 5 G. Capex what would your capex be if you look back to last June.
Few quarters and then also looking ahead.
And how much how much do you think Clinton and.
And on fly G.
And to 2 public feedback specifically and then the second question just a follow up perhaps on the national expansion and I know.
Visited our topic extensively last week, but maybe 1 question about that wasn't quite up to what.
What would make you stay inside Quebec, we talked about lots of reasons why you would go outside and lots of conditions that you want to see but what what.
What would make you stay inside pulled back and not expand and I'm wondering if you can just elaborate and talk a little bit about that thanks.
And I will start a Jeff and and.
And maybe you will add.
So I went and wireless capex.
I understand that what you were asking is what's the breakdown between maintenance and and no pure Capex and I you know.
And for Us.
We're not going to give you the detail of that and for competitive reasons, but what we can say and what I would say is we've been through Oh and it.
It relates to the second part of your question regarding <unk> and it relates to the fact that you know are we know that our competitors are.
And make a lot of noise around 5 G and I guess, probably that you don't have a lot of other choices given that you know they've been unable to.
Offer something else and so there are focusing on that that doesn't mean that you know we don't consider 5 G important and in fact, and though we will continue to invest as you know we launched.
And Quebec, we launch and Montreal, and we will continue to do it and that to have a full <unk> network.
And but we consider that there is no rush to do that and.
And so and it's important to say that we it's another and migration.
And from the.
The other ones that we experienced for the last 20 years or a little bit less than 20 years. Since we are a wireless and.
Operator.
And so and <unk>.
For the the first part of your question in a second.
[laughter] I guess, it's a strange question that Jeff, but I understand that you can ask it.
And.
We I think that last Friday, and you know what.
And to a certain questions.
We were.
We were honest enough to say, yes, you know that we have limited potential of growth and Quebec and now you know we have the entire tools that are to be able and you know to move forward and other markets.
I would like to reemphasize. The fact that you know when we came.
In 2008, with the first auction and the other ones.
Our objective, we're not to speculate on buying spectrum for whatever reason and the different reasons that we've been facing at that time, we thought that it was probably not the bulk of the appropriate time to move forward and the wireless market elsewhere as you know.
We had a certain obligations, namely and this was important because we've been able to acquire and to do at home because of that and but we we we have deadlines and obligations to reimburse them or to buy back our case that before and was position, which we did so.
And this and it is important to mention again that our you know our balance sheet is 1 of the best of the industry and there is no such obligation anymore like the 1 we were facing a not last week, obviously, because the purchase was done a few months a few years ago.
But you know we have now the capacity to grow our free cash flow, we have no obligation we've been refinancing.
And simply as you said and and the script. So all of those are favorable elements are there to provide us with a new segment of growth.
And we think that we will be successful to develop.
And maybe just 1 quick follow up.
Are you would you consider partnerships.
Partnerships and this venture.
And of course this growth segment.
Yeah, and we are open to all sorts of possibilities you know we've been in partnership with the and many companies and the pipe and and different activities whatever printed newspaper and.
So I think well I think that you know you are.
We've been always a good partner and we will continue to be 1 and we understand the the advantages of partnership and also the obligations, yes, they're always do side and on a coin are you all.
Obligations and you have also advantages and this represent a good balance and this is why you know we will always go and I'd be open for a successful debt and devers and this direction.
Great. Thank you.
So I think it's the calls on our conference call, Jeff What was the last question. So to all of you and thank you very much for your attendance and talk to you at the next quarter.
Okay.
Ladies and gentlemen, this concludes the cubic core Inc. 's financial results for the 2021 second quarter conference call.
You for your participation and have a nice day.
Yeah.