Q2 2023 Millicom International Cellular SA Earnings Call

July 27, 2023

Great.

[music].

[music] Hello, everyone and thanks for taking the time to connect to our second quarter 2023 results Conference call. This event is being recorded.

Okay.

Hello, everyone and thanks for taking the time to connect to our second quarter 2023 results Conference call. This event is being recorded our speakers today will be our CEO , how we sell atmos and our CFO Charlotte.

Our speakers today will be our CEO , while we saw Ramos and our CFO Sheldon Wuhan following their prepared remarks, we will have a Q&A session.

Following their prepared remarks, we will have a Q&A session by now you should have received a copy of our earnings release, which is available on our website along with the slides that we will be referencing during today's presentation now.

By now you should have received a copy of our earnings release, which is available on our website along with the slides that we will be referencing during today's presentation.

Now please turn to slide two where you can see our safe Harbor disclosure, we will be making forward looking statements, which involve risks and uncertainties and could have a material impact on our results. We will also be referring to many non <unk> metrics throughout this presentation and we define these metrics on slide four and you can find <unk>.

Now please turn to slide two where you can see our safe Harbor disclosure, we will be making forward looking statements, which involve risks and uncertainties and could have a material impact on our results. We will also be referring to many non iron fresh metrics throughout this presentation and we define these metrics on slide four and you can find rican.

Filiation tables in the back of our earnings release as well as on our website with those disclaimers out of the way, let me turn the call over to our CEO Maui sell Atmos.

Filiation tables in the back of our earnings release as well as on our website with those disclaimers out of the way, let me turn the call over to our CEO of them or we sell a house.

Good morning, and good afternoon, everyone. Thanks for joining us today mid start right away with the highlights of the quarter on slide five.

Good morning, and good afternoon, everyone. Thanks for joining us today, let's start right away with the highlights of the quarter on slide five.

During the quarter, we sold both continued challenges on positive progress on the challenging side, we saw continued political and macro challenges in Bolivia.

And the impact of competition and continued double digit inflation in Colombia. These trends are impacting primarily our home business. In these two countries in response to these challenges we have been adjusting our investment plans and commercial activity accordingly in those markets on the positive side, our meter b and postpaid businesses continue to perform.

And the impact of competition and continued double digit inflation in Colombia. These trends are impacting primarily our home business. In these two countries in response to these challenges we have been adjusting our investment plans of commercial activity accordingly in those markets.

On the positive side, our b to B and postpaid businesses continue to perform strongly across the majority of our markets and most of our markets continued to show positive revenue growth with Paraguay run a mile Nodus, Nicaragua I'm inside of our lower performing worse.

Strongly across the majority of our markets and most of our markets continued to show positive revenue growth with Paraguay bundled lateral and godaddy, Nicaragua I'm inside of our lower performing reps.

All in service revenue grew 1.9 organically in the quarter. This is down a bit from two point to growth in the first quarter. The main reason for this is our decision to take additional steps to defend our prepaid mobile market leadership in Guatemala.

All in surface revenue grew one nine organically in the quarter. This is down a bit from two point to growth in the first quarter.

Reason for this is our decision to take additional steps to defend our prepaid mobile market leadership in Guatemala.

Is defense is taking a bit longer than I had anticipated.

Defense is taking a bit longer than I had anticipated.

This is the correct long term strategy. We believe it is already working and we already see emerging signs of a healthier industry structure in Guatemala, and we'll talk about that in more detail in a moment.

Is the correct long term strategy. We believe it is already working and we are ready to see emerging signs of a healthier industry structure, and Guatemala, and we'll talk about that in more detail in a moment.

We also continue to make very good progress on executing projects embellished our efficiency program. We're strongly focused on an increasingly efficient way of operating all of our business and driving those efficiencies into stronger cash flow. So we continue to invest in Everest during Q2 with some additional one off costs for the one we have seen in Q1.

We also continue to make very good progress on executing projects have reached our efficiency program. We're strongly focused on an increasingly efficient way of operating all of our business and on driving those efficiencies into stronger cash flow. So we've continued to invest in Everest during Q2 with some additional one off costs to the one we have seen in Q1.

The savings are becoming visible in the second half of this year on more so into 2024 and more importantly, we are emboldened by the progress we're seeing on Everest.

The savings are becoming visible in the second half of this year on more so into 2024 and more importantly were emboldened by the progress we're seeing on average and we believe there is meaningful further room for us to deepen those efficiency efforts our focus on cash flow efficiency using data relentless. So Sheldon will talk about that more.

Theres meaningful further room for us to deepen those efficiency efforts, our focus on cash flow efficiency using the relentless so Sheldon will talk about that more in a minute.

In a minute.

Now, let's turn to slide six services revenue grew one 9% during the first quarter driven by growth across all business units, we're seeing slower growth in home, which was flat in the quarter, but mobile was solid, especially postpaid and <unk> remained our top performer as you consume this slide we continue to see positive.

Now, let's turn to slide six service revenue grew one 9% during the first quarter driven by growth across all business units, we're seeing slower growth in home, which was flat in the quarter, but mobile was solid, especially postpaid and b to B remained our top performer as you can see on this slide we continue to see positive.

Across the vast majority of our markets.

Let's look a bit more detailed on slide seven.

Let's look a bit of being more detailed on slide seven.

<unk> service revenue grew six 1% in Q2. This is a six consecutive quarter of growth in the 5% to 6% range. As we have said before this is a result of the renewed VW strategy, we put in place just before the pandemic and which is now paying off.

Peter B services revenue grew six one percentage you too.

This is a six consecutive quarter of growth in the 5% to 6% range. As we have said before this is a result of their renewed VW strategy. We put in place just before the pandemic and which is now paying off.

The growth is fueled by our strategic push into selling digital services. As you will recall. This includes cyber security and manage multi cloud in a secure SD Wan.

Revenue from this digital services grew 29% in the quarter and now represents nearly 20% of our overall <unk> service revenue.

This is exactly what we were aiming for when we have revamped our <unk> strategy a few years back.

We are also quickly reconfiguring, our topline growth on data being by focusing on these scalable digital services, while we're retiring all of the legacy contracts with limited future growth.

We are also quickly re configuring, our topline growth on beta beam by focusing on these scalable digital services, while we're retiring all of the legacy contracts with limited to future growth.

Kudos again to the team.

Those again to the team.

Particularly because we now have a strong pipeline of projects and new clients to sustained growth. For example, we recently signed a large multiyear engagement with Panama, Social security administration for connectivity and remote communication services for over 170 <unk> points across the country.

Clearly because we now have a strong pipeline of projects and new clients to sustain growth. For example, we recently signed a large multiyear engagement with Panama, Social security administration for connectivity and remote communication services for over 170 health points across the country.

You will see the positive impact of this relationship and our preliminary as opposed to beginning in the second half of next year. We have also signed important new contracts recently with Coca Cola FEMSA <unk> pointed out and the awkward eurodollar.

We'll see the positive impact of this relationship and our Panama results beginning in the second half of news here.

We have also signed important new contracts recently with Coca Cola FEMSA <unk> pointed out are female and the awkward eurodollar.

Now distribute our continued positive postpaid mobile results on slide eight.

Now, let's look at our continued positive postpaid mobile results on slide eight.

Our postpaid subscriber base increased by almost 190000 net additions during this quarter.

We have now added more than 500000 postpaid customers over the past year.

Postpaid customers now make up 17% of our total customer base and we believe there is a long runway ahead to continue to migrate more of our customers into postpaid plans up drive hierarchy.

Postpaid customers now make up 17% of our total customer base and we believe there's a long runway ahead to continue to migrate more of our customers and Composted plans are driving higher arco.

Postpaid service revenue has been growing at a 7% CAGR over the past several years and it grew almost 9% in Q2.

Postpaid service revenue has been growing at a 7% CAGR over the past several years and it grew almost 9% in Q2, obviously some of this growth is fueled from our own prepaid business, but our prepaid business itself is actually performing very well and growing in almost every country with the exception of Bolivia, which is driven by the good jewelry changes last year.

Obviously some of this growth is fueled from our own prepaid business on our prepaid business itself is actually performing very well and growing in almost every country with the exception of Bolivia, which is driven by reserve changes last year, and Guatemala, which I will talk about in a moment. So our postpaid business has accelerated in practically every country in our footprint as contribute.

And what <unk>, which I will talk about in a moment. So our postpaid business has accelerated in practically every country in our footprint is contributing to this strong performance postpaid and our comps for more than 20% of our total service revenue on it has become a very important growth driver as we expected it would.

Adding to this strong performance postpaid now accounts for more than 20% of our total service revenue and it has become a very important growth driver as we expected it would.

Needless to say, we're very focused on the higher customer lifetime value of these postpaid customers under stronger posture convergence that they bring to the business.

Endless to say, we're very focused on the higher customer lifetime value of these postpaid customers under stronger posture convergence that they bring to the business.

Now, let's talk about our home business on slide nine.

Now, let's talk about our own business, we're on slide nine.

I've mentioned before our home business that experienced softer growth over the past year and it was essentially flat in Q2 and as we told you at Q1. This slowdown is largely focused on Colombia and Bolivia.

Mentioned before our home business has experienced softer growth over the past year and it was essentially flat in Q2 and as we told you at Q1. This slowdown is largely focused on Colombia Bolivia.

In Colombia increased competition has driven comarco lower than industry churn higher over the past year. As a result, we have shifted our focus to apprise on investment discipline in a way from what would be lesser or unprofitable customer growth.

In Colombia increased competition has driven a hallmark for lower than industry churn higher over the past year. As a result, we have shifted our focus comprise an investment discipline in a way from what would be lesser or unprofitable customer growth.

Sample were maintained and even increased installation fees. This is impacting customer revenue growth, but it helps protect profitability and cash flow by Japan Cathedral churn.

Ample we have maintained and even increased installation fees. This is impacting customer and revenue growth, but it helps protect profitability and cash flow by keeping our lead on churn.

And believe we have the challenges facing home are more macro related political and macro instability, including empty strikes most of customer confidence and reduced middle class income and growth are all taking a toll.

In Bolivia, the challenges, we're facing home are more macro related political and macro instability, including empty strikes most of customer confidence or images middle class income and growth are all taking a toll.

Salt in Bolivia, we are holding the line on installation fees on our pricing.

Salt in Bolivia, we're holding the line on installation fees on our pricing is costing us in terms of net customer losses in the first half of the year, but it is paying off in terms of cash flow with Bolivia actually showing operating cash flow was up double digits in the first half of the year.

This is costing us in terms of net customer losses in the first half of the year, but it is paying off in terms of cash flow with Bolivia actually showing operating cash flow was up double digits in the first half of the year.

Panama is also seeing somewhat lower growth from home, but this reflects both our sustained very high market share on our boots on their own strategic focus on the mobile market via convergence. We're very pleased indeed with our performance in mobile in Panama, Panama performance as a whole is strong with overall service revenue growth of over 4% for the <unk>.

Panama is also seeing somewhat lower growth from home and this reflects both our sustained very high market share on arcos on our own strategic focus on the mobile market via convergence are very pleased indeed with our performance in mobile in Panama, Panama performance as a whole is strong with overall service revenue growth of over 4% for the <unk>.

Business. We also think it are starting to hold the line on pricing on fixed and actually take some rate increases recently will pay off indeed, we have seen some of our competitors recently announced price increases in home in Panama, suggesting good price discipline and help the industry behavior pays off in the long term.

<unk>. We also think it are starting to hold the line on pricing on fixed and actually take some rate increases recently will pay off indeed, we have seen some of our competitors recently announced price increases in home in Panama, suggesting with prejudice, a clean and healthy industry behavior pays off in the long term.

As for our other markets you can see from the chart that our home business continues to grow throughout the rest of our footprint.

As for our other markets you can see from the chart that our home business continues to grow throughout the rest of our footprint Paraguay in particular has seen a strong recovery with growth of nearly 7% in home. In Q2. This is a result of investments that we mentioned in recent years to push fiber deeper into our network and we have seen a significant improvement to never performance in our NPS score.

Paraguay in particular has seen a strong recovery with growth of nearly 7% in home in Q2. This.

This is a result of investments we've been making in recent years to push fiber deeper into our network.

And a significant improvement to never performance in our NPS scores are up.

We're also seeing improved trends in pay TV RJ bank in large store collaborative effort with the government to crack down on piracy over the past year piracy.

Also seeing improved trends in pay TV arcade games in large store collaborative effort with the government to crack down on piracy over the past year piracy.

Piracy is still an issue for us and other markets are appropriately in Paraguay chose a path forward and therefore, we are allowed by authorities for taking valuable action.

Piracy is still an issue for us and other markets are appropriately in Paraguay chose a path forward and therefore, we applauded by authorities for taking valuable action.

Let's now focus on a couple of our larger markets starting with <unk> on slide 10.

Let's now focus on a couple of our larger markets starting with what the mile on slide 10.

As I said at the beginning of these prepared remarks reaping the benefits from our strategy to defend and strengthening our litter stream, Guatemala is taking a bit longer than I expected.

As I said at the beginning of these prepared remarks reaping the benefits from our strategy to defend and strengthening our leadership mathematics is taking a bit longer than I expected.

One we're convinced this is the right strategy to preserve and grow the long term value of the business.

One we're convinced this is a restaurant easy to preserve and grow the long term value of the business and two we see positive signs of a healthier industry behavior in the making.

Two we see positive signs of a healthy industry behavior in the making.

The chart on the left is the first indication that we are on the right track. It shows the evolution of our mobile customer base in Guatemala over the last four years, we can make two observations one we grew significantly and added 1 million new customers during the pandemic and two we have successfully held onto our subscriber base seems Meg and this is key.

The chart on the left is the first indication that we are on the right track. It shows the evolution of our mobile customer amazing Guatemala over the last four years, we can make two observations one with risk significantly and at at a meeting new customers during the pandemic and two we have successfully held onto our subscriber based seems vague and this is Keith.

Second indication is that we have leveled the playing field on spectrum and network position, you'll see this on the right hand chart on this slide I'd like to recall, the precision with telefonica sitting with them out of our main competitor obtained upon restructuring under flowed an upgraded network last year.

Second indication is that we have leveled the playing field on spectrum and network position, you'll see there is on the right hand chart on this slide show like to recall the acquisitions with Telefonica setting let them out of our main competitor obtained upon a spectrum and it flowed an upgraded network last year.

This gave them a temporary network advantage to then put to use by offering popular apps like Facebook ticked our property on a separate basis to the prepaid customers. We initially resisted matching their offered because we think that providing hudsons zero rated basis is a terrible idea for our industry and the long term instead.

This gave them a temporary network advantage that they put to use by offering popular apps like Facebook and kicked our property on a separate basis to the prepaid customers. We initially resisted matching their offer because we think that providing hudsons zero rated basis is a terrible idea for our industry and the long term instead.

Instead, we focused on shielding, our customer base with a more narrow and targeted pricing approach.

Successful migrating our best customers to postpaid stepping up our commercial activity to address our competitors additional spend and invest and drive network capacity to protect our long term standing brought attribute is the best network in the country.

Successful in migrating our best customers to postpaid stepping up our commercial activity to address our competitors additional spin and investing to add network capacity to protect our long term standing brand attribute of the best network in the country.

With these additional network capacity during this second quarter, we change our offer to further align it with our competitors and this impacted our <unk> on our Q2 numbers as you have seen us.

With these additional enabled capacity during this second quarter, we changed our offered to further align it with our competitor's lithium market are going <unk> on our Q2 numbers as you have seen but it has further bulletproof their customer base and market share protected the value and profitability of our business over the long term and indeed as you can see on this slide our COO.

Further bullet proves our customer based on market share protected the value and profitability of our business over the long term and indeed as you can see on this slide our customer base has remained stable.

Customer base has remained stable.

Finally, and most importantly, we have just acquired a significant amount of spectrum in the two six gigahertz bands that was very important to us for three reasons.

Finally, and most importantly, we have just acquired a significant amount of spectrum in the two six gigahertz band that was very important to us for three reasons.

First you can see from the chart that we have nearly doubled our total amount of spectrum.

Our band allocation self hospital associated.

Our band allocation to sell hospitals associating intricately improves this will allow us to add capacity in a cost effective manner and also we served our strong network brand attributes.

We improved this will allow us to add capacity in a cost effective manner I'm hopeful we served our strong network brand attributes.

Second we have successfully leveled the playing field on spectrum and networking with Humana.

Second we have successfully leveled the playing field on spectrum and networking where they matter.

And we have achieved now spectrum priority.

We have achieved now spectrum priority.

Not overemphasize how important this is.

And third this two six gigahertz auction process was well organized well managed and very transparent.

Third these two six gigahertz auction process was well organized well managed and very transparent.

And just as important the industry as a whole behaving are healthy and rational manner.

Just as important the industry as a whole behavior in a healthy and rational manner.

And this is why we see a more stable value enhancing and healthy industry structure in Guatemala.

Now we need to make.

Now in the making.

Now please turn to slide tend to focus on Colombia as most of you know we have invested heavily in this country. In recent years in 2020, we are quite critical spectrum in the 700 megahertz band and since then we have expanded our network in our commercial distribution.

Now please turn to slide tend to focus on Colombia as most of you know we have invested heavily in this country in recent years in 2020, we acquired critical spectrum in the 700 megahertz band and since then we have expanded our network in our commercial distribution.

And then we have steadily gained shared and increase the size of our mobile business since acquiring that spectrum.

We have steadily gained shared and increase the size of our mobile business since acquiring that spectrum.

Our mobile business has been driving our service revenue growth over the past two years and this was true again in Q2 as you can see on the left.

Our mobile business has been driving our services revenue growth over the past two years and this was true again in Q2 as you can see on the left.

<unk> shows continued mobile subscriber growth and sustained revenue EBITDA and <unk> growth.

The Onvia shows continued mobile subscriber growth and sustained revenue EBITDA and <unk> growth.

But as I have said often is not enough margins have been moving gradually and consistently higher but they are still below that 34% level that we haven't you've just prior to the nuclear entering the market.

But as I have said often is not enough margins have been moving gradually and consistently higher but they are still below that 34% level. We had achieved just prior to the nuclear entering the market.

In our Colombia business remains a single and a larger trucks to our group equity free cash flow.

In our Colombian business remains a single and a larger tractor to a group of equity free cash flow.

It's largely because the cost of spectrum in Colombia is many times higher than in our other countries.

So we're taking additional important and immediate steps to improve our investment returns in the country.

We will continue to and with increased emphasis and urgency to drive operational efficiencies margin improvement and product and overall operational simplification.

The operational cash flow in Colombia simply needs to be stronger and two we will continue to pursue inorganic solutions that we expect will help reduce the amount of capital needed to compete effectively in the country.

To that end, we recently announced we have signed an agreement with Telefonica to create a combined mobile network with access to an optimized spectrum portfolio.

To that end, we recently announced that we have signed an agreement with Telefonica to greater combined mobile network with access to an optimized spectrum portfolio.

Efficiencies unlocked by Mr Initiative are very meaningfully in the long term and so is it strategic rationale. This agreement is subject to various regulatory approvals and we're working diligently with Telefonica Argot partners in Colombia to secure that approval.

Efficiencies unlocked by MS initiative are very meaningfully in the long term and so it's strategic rationales is agreement is subject to various regulatory approvals and we're working diligently with Telefonica Argot partners in Colombia to secure that approval.

As we have said often a combination of improved operational performance and inorganic solutions is required to make Colombia in the long term.

As we have said often a combination of improved operational performance and inorganic solutions is required to make Colombia, where in the long term.

Is organic and inorganic initiatives are now well underway and making progress.

Got it and your organic initiatives are now underway and making progress.

Finally, before I turn the call to Sheldon, Let me update you on some of our ESG initiatives, which are deeply relevant to our long term success in the region.

Finally, before I turn the call to Sheldon, Let me update you on some of our ESG initiatives, which are deeply relevant to our long term success in the region first we signed a pledge recommitting to strengthen the rule of law in Central America.

Furnished we signed it that's recommitting to strengthen the rule of law in Central America.

Atlanta is promoted by the partnership entrepreneur America and includes nine key other companies operating in the region like Mastercard, Microsoft and Pepsico as you know, we believe that fostering a culture of transparency integrity and ethical practices in the region will give us a long term sustainable business environmental creating second we.

<unk> promoted by the partnership entrepreneur America and includes nine key other companies operating in the region like Mastercard, Microsoft and Pepsico.

As you know, we believe is fostering a culture of transparency integrity and ethical practices in the region will give us a long term sustainable business environment cooperating.

We released our first report on eligibility and alignment with the EU ESG taxonomy regulation, and we launched a group wide human rights policy, which highlights our commitment to protecting the rights of our customers our workforce on all of our stakeholders and third our digital educational program for teachers in the region, which we call <unk> connect.

<unk>, our first report on LNG ability in alignment with the EU ESG taxonomy regulation, and we launched a group wide human rights policy, which highlights our commitment to protecting the rights of our customers our workforce and all of our stakeholders and third our digital education program for teachers in the region, which we call nice disconnect dose.

<unk> has now reached over 420000 trained teachers since 2020, we're very proud of all of these positive progress.

With that I will hand over to the chosen to discuss our financials for the quarter.

With that I will hand over to the children to discuss our financials for the quarter.

Thank you Mauricio.

Before we review the financials, let me recap the macro context on slide 14.

Before I review the financials, let me recap the macro context on slide 14.

This quarter I'll focus my commentary on inflation as you can see on this slide inflation across most of our markets peaked around September and began to decline rapidly during Q2.

This is very encouraging and it's similar to what we've seen in the U S market. Unfortunately, though inflation has remained elevated in Colombia, where it's still around 12% at the end of June as you can see on the slide this is impacting margins in one of our biggest country operations and this also explains why our interest expense is higher than we had expected this year.

This is very encouraging and it's similar to what we've seen in the U S market. Unfortunately, though inflation has remained elevated in Colombia, where it's still around 12% at the end of June as you can see on the slide this is impacting margins in one of our biggest country operations and it's also explains why our interest expense is higher than we had expected this year.

Because the vast majority of our Columbia debt is in local currency and a variable rates linked to inflation.

We also see the impact of interest rates on our lease expenses because most of our contracts include annual price adjustments that are linked to inflation as well.

So in summary, recent inflationary developments are positive, but we still have a way to go to get back to a more normal inflation levels, particularly in the large markets of Colombia.

So in summary, recent inflationary developments are positive, but we still have a way to go to get back to a more normal inflation levels, particularly in the large market of Colombia.

Okay.

Now, let's look at our Q2 performance beginning on slide 15.

Service revenue was $1 $2 9 billion in the quarter, which is down from $1 $3 billion, a year ago due to exchange rate movements.

Service revenue was $1 two $9 billion in the quarter, which is down from one $3 billion a year ago due to exchange rate movements.

Our service revenues were once again negatively impacted by adverse FX trends this quarter, primarily due to currencies in Colombia, which depreciated, 12% on average during the quarter compared to a year ago and.

And in Paraguay, which depreciated about 5%.

Excluding the impact of FX organic growth was one 9% in the second quarter.

This compares to two 2% growth reported in Q1 and the slight slowdown mostly reflects the actions we took in Guatemala as Mauricio discussed earlier.

This compares to two 2% growth reported in Q1 and the slight slowdown mostly reflects the actions we took in Guatemala as ratio discussed earlier.

Both our mobile and fixed businesses grew approximately 2% during the quarter with postpaid mobile and b to b being standout performers.

Drilling down further on slide 16 to the service revenue by country.

Yeah.

Okay turns EBIT slide 17, <unk> $550 million was down 10.8% from $577 million from a year earlier there.

Okay turns EBIT up slide 17, EBIT a of $550 million was down 10.8% from $577 million from a year earlier there.

There are a number of items from take care to provide a fuller picture of the performance. This is not meant to be an excuse cause I am not pleased with the with the Alger and we need to and will do better, but I went to explain to provide transparency.

There are a number of items from take care to provide a fuller picture of the performance. This is not meant to be an excuse cause I am not please with EBIT out journey, and we need to and will do better when I went to explain to provide transparency.

First xxxx impact primarily from Columbia in Paraguay, a counter for about $18 million or three percentage points of the decline.

First xxxx impact primarily from Columbia in Paraguay, the counter for about $18 million for three percentage points for the decline.

Second we encourage severance and other restructuring costs for about $6 million related to our cost efficiency program project Everest.

Come back to talk more about never later in the presentation.

Come back to talk more about it later in the presentation.

Third as you saw also in Q1 sure based compensation is higher this year because of our stock price increased meaningfully between the time when the shares were granted of December and when the cost of these grants were books.

Q1.

This is a non-cash items and has had a 5 million dollar impact on D. V. D. I N Q too similar to Q1 and this impact is expected to continue in Q3 and Q4.

This is a non-cash items and has had a $5 million impact on D. V. D. A in queue too similar to Q1 and this impact is expected to continue in Q3 and Q4.

Fourth.

We insurance would cost for legal advisory another third party services related to the buyout discussions that took place and have now concluded.

We encourage the cost for legal advisory another third party services related to the buyout discussions that took place and have now concluded.

This was about $3 million, which disappear next quarter.

Finally, after the end of the quarter, we received an adverse legal ruling in Colombia, which impact the D V D. A by about $10 million, we've already filed an appeal, but we had to book an additional provision for this in our queue to.

Finally, after the end of the quarter, we received an adverse legal ruling in Colombia, which impacted D V. D. A by about $10 million, we've already filed an appeal, but we had to book an additional provision for this in our queue to.

This was partially offset by much smaller 2 million dollar benefit in Bolivia.

This was partially offset by a much smaller 2 million dollar benefit in Bolivia.

In addition, I also Wanna mentioned, some legal fees that we have been incurring over the past year as a response to questions from the US Department of Justice in regards to the Peanuts that we received on April of 2022, there are no new developments in the case and we continue to cooperate fully with the D. O J, but there is a cost to this over the past year, we have spent 15.

In addition, I also wanted to mention some legal fees that we have been incurring over the past year as we respond to questions from the US Department of Justice in regards to the Peanuts that we received on April of 2022, there are no new developments in the case and we continue to cooperate fully with the D. O J, but there are the cost of this over the past year, we have spent 15.

Million dollars on legal fees, including $5 million in the most recent quarter and a similar amount in Q1.

We cannot easily predict whether these legal fees will continue and how they will evolve.

But at least we will begin to lap. These expenses in second half of this year, which will help our year on your comparisons going forward.

But at least we will begin to laugh. These expenses in the second half of this year, which will help our year on your comparisons going forward.

Excluding FX and all these unusual items are EBIT, a would have declined about two and a half per cent during the quarter driven by the underlying country performances, which I will now cover on slide 18.

Excluding FX and all these unusual items are EBIT declined about 2.5% during the quarter driven by the underlying country performances, which I will now cover on slide 18.

As we discussed previously a commercial decision we've made in Guatemala to defend our leadership position I said Nader impacts this corner and EBIT, a declined 7.7% to $199 million.

As we discussed previously a commercial decision we've made in Guatemala to defend our leadership position as a native impacts this corner and EBIT declined 7.7% to $199 million. This is flat compared to Q1.

This is flat compared to Q1.

Columbia EBIT a grew 5% after adjusted for reporting one offs in both periods as <unk> mentioned already in our margins have been gradually expanding over the past two years and we are taking steps to continue to drive these hire overtime.

Columbia EBIT a grew 5% after adjusted for reported one offs in both periods as <unk> mentioned already in our margins have been gradually expanding over the past two years and we are taking steps to continue to drive these hire overtime.

Panama grew 1.5%, excluding the one off of last year Ah service revenue growth of 4.1% was partially offset by increased content span and expenses related to <unk> channel as well as increase bad debt.

Paraguay ahead impressive EBITDA growth of 12.4% consistent with a very strong service revenue we already discussed.

Olivia was down 10% that should be discussed previously we continue to face maccarone competitive challenges there and we have not yet left the regulatory change that went into effect in August of last year.

Olivia was down 10% that's what we discussed previously we continue to face maccarone competitive challenges there and we have not yet lapsed the regulatory change that went into effect in August of last year.

<unk> and the remaining countries of Central America was just over 3% Salvador and almost five per cent of Nicaragua.

Finally, Honduras, which we do not consolidate at strong growth of 6.8%, reflecting the improved revenue trends during the quarter.

Finally, Honduras, which we do not consolidate as strong growth of 6.8% reflected the improved revenue trends during the quarter.

I want to spend a moment or giving our efficiency program project Everest before we continue to make significant progress this corner.

I want to spend a moment reviewing our efficiency program project Everest before we continue to make significant progress this quarter.

As you know we've been hard at work on several initiatives that will drive great efficiency and agility Cross the organization. These.

As you know we've been hard at work on several initiatives that will drive great efficiency and agility Cross your organization.

These initiatives range from organizational restructuring to trucker authorization and power savings initiatives.

During the quarter, we encouraged $6 million on implementation costs, bringing the total for the year to approximately $21 million in the second half of this year, we will continue to incur some small implementation costs, but the savings will start to become visible and faxed. The savings in 2023 will be materially greater than each implementation.

During the quarter, we encourage $6 million on implementation costs, bringing the total for the year to approximately $21 million in the second half of this year, we will continue to incur some small implementation costs for the savings will start to become visible in fact, the savings in 2023 will be materially greater than each implementation.

<unk>, making a project net positive for the year.

Cause making a project net positive for the year.

We expect the momentum of our savings to start in the second half of this year and continue through 2024.

As a result, we're making great strides for achieving our goal of over $100 million in annual run rate savings by the end of 2024 with more than 50 per cent of those run rate savings expected by the end of 2023.

As a result, we're making great strides to achieving our goal of over $100 million can annual run rate savings by the end of 2024 with more than 50 per cent of those run rate savings expected by the end of 2023.

We are encouraged by the progress we've made so far but we also continue to see additional opportunities and we believe there is still more we can and need to do to streamline operations and simplify and improve the way, we operate and drive better financial performance from this business.

We are encouraged by the progress we've made so far but we also continue to see additional opportunities and we believe there is still more we can and need to do to streamline operations and simplify and improve the way we operate in drive better financial performance from this business.

We're already developing second phase of efficiency opportunities and provide updates to you on this is our plan to solidify.

We're already developing second phase of efficiency opportunities and roommate updates to you on this is our plant solidify.

Now please turn to slide twenty-four unusual in that that bridge.

Now please turn to slide 24, you wanted that bridge.

Net that does that $100 million. This is due to equity free cash outflows during the quarter as.

Nope that does that $100 million. This was due to equity free cash outflows during the quarter.

Has increased spectrum and interest costs outpaced organic O C. F growth I've, almost 10 per cent and a quarter is lower capex made up for this decline in EBITDA. We also had a xxxx impact from the translation of local currency desk at the Colombian peso at June 30th strengthened from its level of March 31st.

Increase the spectrum and interest costs outpaced organic O C. F growth of almost 10 per cent and a quarter is lower capex made up for this decline any <unk>. We also had a xxxx impact from the translation of local currency desk as a Colombian peso at June 30th strengthened from its level in March 31st.

As well as the appreciation of the Swedish kronor during the quarter, which affected the cash payment related to a hedge we had in our second bond, which redeemed in order.

As well as the appreciation of the Swedish kronor during the quarter, which affected a cash payment related to a hedge we had in our second bond, which redeemed in order.

And as a reviewed earlier <unk> in the first half of this year is impacted by a number of one off an unusual items all of which are having short term impacts on our debt to EBITDA leverage ratio.

We entered you to just over $6 billion in that cat and <unk>. After leases a 3.34 times. If we include lease obligations or just over $1 billion or leverage was 3.37 times at the end of Q2, which is up from 3.23 times at the end of the <unk>.

We entered two two I'd just over $6 billion of net debt and <unk>. After leases a 3.34 times. If we include lease obligations were just over $1 billion or leverage was 3.37 times at the end of Q2, which is up from 3.23 times at the end of the <unk>.

That may have to call back over to <unk> now for awhile.

Let me have the call back number to reach you know for awhile.

Thank you Sheldon before we go into Q&A, Let me run deep South we're obviously not happy with their queue to results and.

Thank you Sheldon before we go into Q&A, let me rub the deep South we're obviously not happy with their future results.

And we are therefore, very focused on getting stronger and more sustainable Kathryn.

And we are therefore, very focused on getting to stronger and more sustainable classroom.

<unk> and there are four key priorities that will get us there.

One we're improving operational deficiency across the business more than ever before we simply find product offerings and operations with automatic processes and we're digitizing conference and across the board were driving new opportunities to reduce costs and increase <unk> <unk>.

<unk>, improving our ratio of efficiency across the business more than ever before we simply find product offerings and operations with automatic processes and we're digitizing conference and across the board were driving new opportunities to reduce costs and increase <unk> <unk>.

<unk>, our investments and our strategy are aimed at restoring a healthy and sustainable industry structure <unk>.

Seconds in Guatemala, our investments and our strategy are aimed at restoring a healthy and sustainable industry structure.

Invest it further institute to get there and we're beginning to see signs of positive developments.

Invest it further in the queue to get there and we're beginning to see signs of positive developments.

Third in Columbia were accelerating our plans to increase margins and customers corporation of efficiency and through simplification.

Third in Columbia were accelerating our plans to increase margins and customers Corporation of efficiency and through simplification and we're also now driving much needed gardening solutions and getting some traction there and four were advising quickly and truly unlucky the important carve out and <unk>.

Also now driving much needed gardening solutions and getting some traction there.

Four were advising quickly and surely unlucky the important carve out and <unk>.

As you can see this is all about getting to a solid and sustainable equity free casually 2024, and therefore, creating value for our shareholders without we're ready for your questions.

As you can see this is all about getting to a solid and sustainable equity free casually 2024, and therefore.

Getting value for our shareholders without we're ready for your questions.

Thank you <unk> for now going to move to the Q&A session and we have our first question coming from I guess, but yeah, let's go to the bank.

Yeah, Hello can you hear me.

Yes, we're gonna hear you loud and clear.

Yes, we can hear you loud and clear.

Okay. Thank you well thank you.

Okay. Thank you. Thank you uhm, yes that <unk>.

Uhm, yes that <unk>.

I ask you about that M&A moves in Columbia consolidation in Colombia.

I ask you about.

Hey, my name moves in Columbia consolidation in Colombia.

And you said that it was the right time to the remember and in just a few weeks after the announcement of the of the memorandum of them.

Okay, <unk> with with telephone account and so I have a I have a couple of questions from back <unk>, perhaps it's got the timing of that deal and you know what what what are you thinking in terms of <unk> <unk>.

<unk> with with Telefonica, a so I how about I have a couple of questions from back <unk>, perhaps this got the timing of that deal and <unk>. What are you thinking in terms of clothing in terms of a <unk>.

<unk>, a <unk> would like to understand that this is a 50 58 joined bank to a meeting at that.

<unk>, a <unk>, we would like to.

<unk> 50, 58 joined bank to a meeting at that.

You know it both of you in California, <unk> partners <unk> infrastructure company.

Both you and Telefonica owning equal partners <unk> infrastructure company.

<unk> <unk> <unk>, it's a 50 50 agreement whether you guys, perhaps suspecting telephone he got to contribute some cash in order to reach that <unk>.

And if it's a 50 50 agreement whether you guys, perhaps suspecting telephone he got to contribute some cash in order to reach that <unk>.

And the <unk> and perhaps the most important if you believe this deal wheel.

<unk> and this is the most important if you believe this deal wheel a M. The cash burning Columbia. If you believe that this will finally lead you into Pacific extra getting mainstream Columbia. Thank you.

And the Cashback Columbia, if you believe that this will finally lead you into Pacific extra get arrangement Columbia. Thank you.

Alright, well. Thank you so uhm, let's start thank you address for that salt.

Alright, well. Thank you so uhm, let's start thank you undress for that so what the deal is to begin with it's at all mobile network sharing agreement with Telefonica.

What the deal is to begin with it's at full mobile network sharing agreement with Telefonica sharing the.

Sharing the.

B R S, including the <unk>, we're showing the transmission equipment.

B R S, including the antennas, we're showing the transmission equipment.

We're optics, what we're not sharing of course is the core network itself.

We're optics.

We're not sharing of course is the core network itself.

The commercial operations naturally and we are putting a single set of spectrum into the joint venture. So that's that's very important to understand so they just won't be very different from some of the agreements that you've seen that appointment I'm older amongst others do elsewhere. So it is a columbine jointly on <unk>.

The commercial operations naturally and we are putting a single set of spectrum into the joint venture. So that's that's very important to understand so they just won't be very different from some of the agreements that you've seen <unk> amongst others do elsewhere. So it is a columbine jointly on <unk>.

Chaired mobile network company.

Shared mobile network company in Columbia.

Columbia Each company it serves their commercial separate operations under court. That's what the deal is it is a shared.

Columbia, Each company preserves their commercial separate operations under score.

What the deal is it is a shared.

G deal.

T deal.

For clothing, and equipment, <unk> et cetera, et cetera, I won't go into the detail. So if you don't have a nation of compensation back and forth.

For clothing, and equipment, <unk> et cetera, et cetera, I won't go into the detail, though so if you don't have a nation of compensation you back and forth.

Everything, including a joint spectrum.

<unk> agreement.

Agreement.

In terms of timing.

We're finalizing the final agreements and we've submitted all the documents to the Columbia <unk>.

We're finalizing the.

Final agreements and we've submitted all the documents to the Columbia and <unk> <unk>.

A Colombian authorities are very thorough on these matters I'm very professional on these matters really expect that they'll take a full <unk>.

A Colombian authorities are very thorough on these matters very professional on these matters really expect that they will take a four <unk>.

Just working with our partners.

Oh, that's funny.

<unk> <unk> Oh, well.

<unk>, Oh, well, we expect that he would take somewhere between six.

We expect that he will take somewhere between six.

B 12 months, we hope it doesn't take that long, but it certainly you know within the expected up for long times. The key to the deal of course is that it provides efficiencies on network.

B 12 months.

Take that long, but it certainly within the expected up for a long time.

The key to the deal of course is that it provides efficiencies on network.

<unk> network maintenance for everything that has to do with the network itself, but also efficiencies around spectrum, which is you realize in Colombia are very very important to keep it under very high cost of spectrum.

We think this is very positive to the marketplace should be very well received and it has been very well received by authority is because.

We think this is very positive to the marketplace should be very well received and it hasn't been very well received by authority is because its viability.

My ability are going forward and and that leads to your last question on the dress was yes <unk> important step.

Going forward and <unk> to your last question on the dress was yes.

<unk>.

Towards getting Columbia for equity was pretty comfortable if not the one and only we're taking <unk> talk about they're prepared remarks were driving operation up you're just sitting across the operations. The combination of those will.

Towards getting Columbia.

<unk>, it's not the one and only that were taken <unk> talk about in your prepared remarks were driving operational efficiencies across the operations Nick <unk> those will.

Will get us to where we need to be in Colombia.

Yeah. That's it thank you on mute, but.

<unk>. Thank you on mute, but I think that's probably answered your question. So we'll go now to.

I think that's probably answered your question. So we'll go now to.

<unk>.

Okay.

<unk> J P Morgan.

<unk>.

<unk> sorry.

Sorry.

I don't know if you called me I'm here. Thanks for taking the question I have two questions.

If you called me I'm here. Thanks for taking the question I have two questions.

First is the stuff that is in the Colombian market and especially in the home market could you discuss a bit more like how.

First is the substance and the Colombian market.

And especially in the home market could you discuss a bit more like.

How in regards to macro incorporate this is mostly competition is there a macro angle <unk> I just wanted to go a bit deeper on that home environment in Colombia, and the second the run rate of ever savings could you <unk>, what's the run right now of ever savings you gave an indication artwork to be by the end of the year, but what have you kept her so.

How in regards to macro competition. This is mostly competition is there a macro angle I <unk> I just wanted to go a bit deeper on that home environment in Colombia, and the second the run rate of ever savings could you <unk>, what's the run right now of ever savings you gave an indication artwork to be by the end of the year, but what have you kept her so far.

<unk>. Thank.

<unk>.

Thank you.

I'll give you a little bit of color along the first one must thanks for joining today and.

I'll give you a little bit of color along the first <unk>. Thanks for joining today and.

That would give a shout out a little bit of time to prepare for number two so.

That will give a shout out a little bit of time to prepare for number two so.

So.

It's it's a bit of both policy, Colombia to self nest on a phone submit a macro.

It's it's a bit of both policy, Colombia, the softness on a phone submit a macro.

That'd be the competition so.

A bit of competition so.

The Columbia D. As you know this year is as much softer than anywhere else. It's only gonna grow might be one 2% and inflation has remained very high in Columbia, So consumers are feeling.

<unk> you know this year is much softer than anywhere else, it's only gonna grow maybe one 2% and inflation has remained very high in Colombia.

So consumers are spelling.

The macro hurting all day I'm, an overall confidence in Columbia as you've seen.

Macros hurting on them, an overall confidence in Columbia as you've seen.

Consumer confidence is is very very low not that has an impact on the middle class has an impact on broadband adoption.

She my confidence is is very very low not that has an impact on the middle class has an impact on broadband adoption.

Coupled with that there's been quite a bit of competition in the marketplace and then the two things come by you know once or softness.

Coupled with that there's been quite a bit of competition in the marketplace and then the two things come by you know <unk>.

<unk> each other customers insurance goes up so competition has increased in Colombia.

You very well know Marcelo and reset this.

You very well know are subtle and reset this.

Kinda prepared remarks, we have remained very <unk> Columbia.

Can get prepared remarks.

Have remained very disappointed in Colombia.

We're not driving customer growth in Colombia.

<unk> no profitability would taken the <unk>, which is what would you rather be very very disappointing Columbia Chet installation fees in Colombia.

<unk> no profitability would taken the <unk>, which is where would you rather be very very disappointing Columbia Chet installation fees in Colombia.

We think that's a right longterm strategy and last week, one of our largest competitors follow no not strategy and put some installation fees as well so hopefully there'll be some more rationality going forward.

We think that's a right longterm strategy and last week, one of our largest competitors all of the mass tragedy and put some installation fees as well so hopefully there'll be some more rationality going forward.

Sure Michelle out on the on the project Evers questions first of all that you know I'm very bullish should and about the opportunity it won't be able to do so far.

Sure Michelle out on the on the project Evers questions first of all look I'm, you know I'm very bullish it uhm and about the opportunity and what would be able to do so far on this program.

This program.

You know we've incurred as we've highlighted you know about six men in startup costs sort of started implementation costs in this quarter I know about 21 billion you know cumulatively in the first half of this year and highlight as well you know <unk>.

We have incurred as we've highlighted you know about six men in startup costs sort of started implementation costs in this quarter I know about 21 billion you know cumulatively in the first half of this year and highlight as well you know the.

The benefits of already cheap by the program I've already essentially surpassed that we went sort of just essentially that's positive on that project adverse to you're just a smart so so kind of year to date or or essentially neutral in terms of it turns out those impacts so you're the second half of this year will continue to incur some some additional startup.

The benefits of already cheap by the program I've already essentially surpassed that we went sort of just essentially that's positive on that project Everest here, just a smart so so kind of year to date or or essentially neutral in terms of in terms of those impacts. So so the second half of this year will should change you to incur some some additional start.

Cost, but you know we will now start seeing the benefits of those float through I've highlighted you know the run right, where we exit. This you know this year to be sort of you know in excess of half a barge full ambition of a of $100 million. You know I think will be will be materially you know higher than half as we exit the ear.

Of course, but you know we will now start seeing the benefits of those flip through I've highlighted you know the run right, where we exit. This you know this year to be sort of you know in excess of half a barge full ambition of $100 million. You know I think what will you will be materially you know higher than half as we exit the year.

Uhm.

I think you know as we've gone through this project I think you know what I pointed out too I mentioned to my prepared remarks as well as you know we do see her the other opportunities here or there is more we can and should be doing from this program and you know and so you know not just implementing what we've sort of having our plans brochure identify new opportunities around around you know increase.

I think you know as we've gone through this project I think you know what I pointed out too I mentioned to my prepared remarks as well as you know we do see her the other opportunities here or there is more we can and should be doing from this program and you know and so you know not just implementing what we've sort of having our plans, Russia identify new opportunities around around <unk>.

Increased amplification crossed our business you know increase Doug organizational reorganizations around us how it can sort of optimize you know what we're doing with it with the people that we have those are gonna be important items that we're now going through and and trying to get you re size is a kind of mentioned every two dot O. So we can you know that sort of in processes, we're going to.

<unk> crossed our business you know increase Doug organizational reorganizations around us how it can sort of optimize you know what we're doing with it with the people that we have those are gonna be important items that we're now going through and and trying to get you re size is that kind of mentioned every two dot O. So we can you know that sort of in processes, we're going through our budgeting cycle.

Of our budgeting cycle here and you know we do see your other opportunities I don't think we'll we'll be expecting immediate deliver other opportunities there.

Here and you know we do see your other opportunities I don't think we'll we'll be expecting immediate deliver other opportunities there.

Perfect. So so just just to be clear at least 20 <unk> run Rachel already got because that's the cost. So that's how we should understand digits February even that's been at least 20 medium at this point run right yeah.

Perfect. So so just just to be clear at least 20 million run right you already got because that's the cost. So that's how we should understand digits February even that's been at least 20 medium at this point run right.

Yeah, what I'm, saying, it's actually it's 20 million what we've achieved in the first six months yeah perfect perfect. Okay. Thank you very much.

Yeah, what's up saying, it's actually it's 20 million what we've achieved in the first six months yeah perfect perfect. Okay. Thank you very much.

Thanks, Marcello. So next we're gonna go to Sonny tend to marry and HSBC funny.

Thanks, Marcello. So next we're going to go to Sonny tend to marry at HSBC funny.

Good morning, Thanks for taking my question. So the first question I think is kind of extinction of the question that we had previously so.

You have an inorganic solution in Columbia <unk> are you looking at monetization was a success it site and Colombia already made me at the market.

You have an inorganic solution in Columbia <unk> are you looking at monetization was a success it site and Colombia already named me at the market.

That's the first one second one is can you tell us.

That's the first one.

Second one is can you tell us.

An update on how spin off of the Dos is coming up and it's been off let's see it's eight off the to us is coming up and.

Alright, and update on how your spin off of the Dos is coming up and it's been awful, let's see I'd say it off the to us is coming up and.

What is that like the timeline instead of change from last update thank you.

<unk>. Thanks for joining I assume the second question is is it are they all girl power portfolio.

<unk>. Thanks for joining I assume the second question is is though the overall the tower portfolio.

Correct.

<unk> as I said, often and I think it was very clear not only lost border, but this border.

Very committed extremely committed to getting Columbia.

Having committed extremely committed to getting Columbia.

Out of being our all of the negative equity free Costco producer perfect territory and that requires organic focus driving hospitals, we're doing incremental the show going forward as I mentioned it already but also a series of inorganic solutions, we've talked about it.

Out of being our all of the negative equity Street, Costco producer perfect territory and that requires organic focus driving hospitals, we're doing incremental the show going forward as I mentioned it already but also a series of inorganic solutions, we've talked about it.

So at the beginning of this call.

So the beginning of this call.

On the combination of the mobile network with Telefonica, which is fundamental strategic because I just mentioned in terms of spectrum synergies spread.

On the the combination of the mobile network with Telefonica, which is fundamental strategic because I just mentioned in terms of the spectrum synergies spread.

Friends are Edward synergies as well.

There are other organic ideas in the mix, but I would prefer not to comment on M&A dot.

It's it's it's still in the kitchen, let's put it that way never a good idea too.

It's it's it's still in the kitchen, let's put it that way never a good idea.

Talk about stuff, that's gonna kitchen, My Grandma would say just get it burns.

Talk about stuff that's in the kitchen, My Grandma would say just get it burns.

So allow me some flexibility there funny now unlucky as I said.

So allow me some flexibility verify now unlucky as I said.

A number one it remains a top priority.

A number one remains a top priority.

One of our key priorities for reasons that are well understood by everyone.

The opportunity to capture some value the effects on the business et cetera et cetera.

Continue to capture some value the effects under business et cetera et cetera.

The second point out would take is a full new board is very supportive and very engage with this initiative. So we've.

The second point I would take is a full new board is very supportive and very engage with this initiative. So we've we now have renewed emphasis if you will on it see we continue making significant progress I think when we started this process I was very carefully and saying you know this is.

I'll have renewed emphasis if you will on it see we continue making significant progress I think when we started this process I was very careful even saying you know this is this is a long haul toy process Sir.

This is a long haul preparatory process setting.

Setting up the agreement, creating this structure is you need to try another country's moving the towers around et cetera, et cetera, so tons and tons of work.

Setting up the agreement, creating this structures and each one other countries moving the powers around et cetera, et cetera, so tons and tons of work that.

That work.

Not work.

<unk> has been less delayed than I thought I, probably expected what so we remain largely not perfectly sunny on track with that I'm sure. We're still shooting in terms of timing.

Frankly has been less delayed than I used on I, probably expected what so we remain largely not perfectly sunny on track with that I'm sure. We're still shooting in terms of timing.

Get something in the works by the end of this year.

Main spilling too early next year funny, but that's well within what you would expect for my project.

Mays spilling too early next year funny, but that's well within what you would expect for my project.

Size and.

Size.

Lastly, the last point I would make them as soon as we learn more and more the opportunity <unk>, you'll be very bullish on it.

Lastly, the last point I would make them as soon as we learn more and more the opportunity <unk> be very bullish on it and so it's always are for new board.

So it's always are for new board.

That's the long and short of that I think those four points give you a lot of color Bunny.

That's the law and short of that I think those four points gives you a lot of color Bunny.

Yeah <unk> just additional question data on on the monetization of fixed assets like is that only in Columbia that you're looking for it and I'll get <unk>. So you're looking at the product <unk> portfolio for the successes.

Yeah <unk> just additional question that on on the monetization of fixed assets like is it only in Columbia that you're looking for it you know again <unk> answer you're looking at a product that <unk> portfolio for the successes.

There isn't a single idea, they're using a single geography, there isn't a single set of assets, which we normally as a matter of you know.

There is some days single idea, they're using a single geography, they're using a single set of us as each which we normally.

Matter you know.

<unk> no king if there are better ways to return to top it all better get you Gotta get get a better return to look up at all.

<unk>, we're not looking if there are better ways to return to top it all better get you Gotta get <unk> returns on capital.

Alright, thanks to <unk> everywhere, all the time with all of <unk>.

Alright, thank you.

Everywhere all the time with all of <unk>.

Perfect. Thank you honey.

Perfect. Thank you.

Alright next we're gonna go to Frederick lethal at Handelsbanken Frederick.

Thank you gentlemen, thank you for taking my questions as well just wanted to go back to your recent update on your guidance for the <unk> <unk> cash flow for 22, the center for more than 500 million Oh did you see any reasons today is that in and it'll be markets you will see earlier.

Thank you gentlemen, thank you for taking my questions as well just wanted to go back to your recent update on your guidance for the E. I quit the free cash flow for 22, the center for more than 500 million Oh did you see any reasons today that in any of your markets you will see earlier.

<unk> is the ones that you sort of.

<unk> is it once that you sort of.

Came across in the spring so are there any <unk>.

Okay.

Perfect spectrum.

Hello, you've been <unk>.

<unk> <unk> <unk> <unk>.

Rodriguez.

<unk>.

We launched Frederick but I think the question was around any expectations for spectrum.

We lost Frederick but I think the question was around any expectations for spectrum.

<unk>.

Alright.

So hopefully Friday, you're you're still on the line so.

So hopefully Frederick you're you're still on the line so.

The key upcoming phone cause I'll, just be said I think.

The key coming phone cause as we said I think.

Ah remarks, as well as a <unk>.

<unk> a <unk>.

Is the.

Second auction in Guatemala that will likely happen.

Second auction.

That would likely happen.

Before the end of this year.

And that would be around 700 megahertz as you may recall, we have some 700 megahertz, but there is an opportunity to further you know very rational minor complaint spectrum positions for the industry as a whole and.

You know in the back of the very successful 2.6 Giga her adoption, which is completed we're working diligently to see if we can get that 700 megahertz Ah completed before your and that's.

You know in the back of the very successful 2.6, Giga her adoption, which is completed.

We're working diligently to see if we can get that 700 megahertz Ah completed before year end.

That's the one that's the most important does the art art or as in many markets about other spectrum possibilities Columbia five G.

That's the one that's the most important there are <unk> many markets about other spectrum possibilities Columbia five G.

Some of the preliminary to schedule. It for the very end of this year at <unk> next year and that's why these network combination, which other phone and guy is so important because it allows us not tackle that potential five G spectrum Wednesday to Hopkins the end of this year into the next year.

Similarly, preliminarily schedule it for the very end of this year at <unk> next year and that's why these network combination, which other <unk>. So important because it allows us not tackle that potential five G spectrum when that happens the end of this year into the next year.

<unk> combined spectrum, Patricia Jones, do with Telefonica, a new authority to understand the importance of days.

From a position of combined spectrum, Patricia Jones, do with Telefonica, a new authority to understand the importance of the face.

There's always conversations of the spectrum everywhere else. These are the two that I would put in front of the bernero as as in Turkey important ones.

There's always conversations of the spectrum <unk>. These are the two that I wouldn't put in front of the burner.

Bernero size in Turkey important ones.

The amount of something that we're actively working towards and hope we can get done in Colombia, something that we're preparing ourselves for with the mobile network merger with Telefonica.

Something that we're actively working towards an old can get done in Colombia, something that we're preparing ourselves for with the mobile network merger with Telefonica.

Frederick we lost the the end of your questions. So maybe if there's something we misplaced remind us what you were asking.

I think I got that cleared off on the full question. So no worries about that maybe I can take a follow up on Guatemala what.

I think I got that cleared off on the full question. So no worries about that maybe I can think of follow up I'll go off them all on what what.

What makes you confident that's your defense.

Haven't been successful and that you know do I mean do you see in the market that your competitors pulling back on lowland offerings. So whatever it might be that has been the fighter.

Hasn't been successful and that you know do I mean do you see in the market that your competitors pulling back on no end offerings or whatever it might be that has been the fighter.

Oh, let's see my my confidence.

Oh, that's my my confidence comes from the fact that this is a two player mark here in which both operators are important market Sharon scale.

The fact that this is a two player mark here in which both operators are important market Sharon scale and.

And that in the long term.

Beyond skirmishes here and they're painful as they are in the short term should lead to a stable healthy industry structure, I've always said that and I've always said that these.

Beyond skirmishes here and they're painful as they are in the short term should lead to a stable healthy industry restructuring I've always said that and I've always said that these.

Very painful short term challenge to our position will eventually turn around.

Painful short term challenge to our position.

<unk> turn around.

Now few things have changed that lead me to be.

Now.

Few things have changed that lead me to be.

All the data is in the making as I said.

All the <unk> as I said.

Number one we've achieved network and spectrum poverty actually we just got the actual titles to that 2.6 yesterday. So the network is being late as we speak.

Number one we've achieved network and spectrum poverty actually we just got the actual titles to that 2.6 yesterday. So the network is being a bit as we speak.

Means that will go from a position of.

Means that will go from a position of inferiority and spectrum spectrum already a network party, that's meaningful and because we've held onto our subscriber base that would try some rationality in the marketplace. We will now have better tools to compete particularly in a very cost efficient manner in the prepaid mark.

Corona and spectrum spectrum already in network party, that's meaningful and because we've held onto our subscriber base that would try some rationality in the marketplace. We will now have better tools to compete particularly in a very cost efficient manner in the prepaid market, that's very very meaningful and Ah completed from note.

<unk>, that's very very meaningful and a competitor knows that for sure. The second thing is I just haven't had prepared remarks that shows signs of rationality is at 2.6 figure adoption itself.

For sure. The second thing is I just haven't had prepared remarks that shows signs of rationality is at 2.6 figure adoption itself.

<unk>.

Rationally managed well managed by the government the industry came and work with the government to make it happen.

<unk> for the last 15 years, so if I could just can happen she picks up an industry that is working with the government that is very positive.

No you've been an option and whatnot up for the last 15 years. So the fact that can happen. She thinks of an industry that is working with the government and that's very positive now.

Lastly, just last week, we saw a competitor raise prices on <unk> and that's a small sign perhaps things are moving in the right direction.

Now lastly, just last week, we saw a competitor raise prices on <unk>.

A small sign perhaps things are moving in the right direction I will tell you. This is obviously I don't control the timing of when things pull back we're doing the right thing.

I will tell you. This is obviously I don't control the timing of when things pull back we're doing the right thing.

We're doing the right thing to defend the business. It isn't working were holding onto a subscriber paisley improving our network.

Or doing the right thing to defend the business. It is working were holding onto a subscriber paisley improving our network.

<unk> R. R spectrum capacity it is or why it's being for the longterm. It is painful in the short term no doubt you were feeling that.

R. R spectrum capacity is Irvine theme for the long term it is painful in the short term no doubt you were feeling that.

Is definitely the right thing to do for the long term and that's what we're doing <unk>, you know and hopefully the short term I don't control when things will turn around.

Is definitely the right thing to do for the long term and that's what we're doing <unk> and hope for the short term I don't control when things will turn around.

Next order the following order I see them turning around I see the page Sterling.

Next order the following order I see them turning around.

See the page journey.

Don't control it and this is how we drive longterm value creation for the business and that's really salsa that I remain very possibly that things will turn around.

Don't control it and this is how we drive longterm value creation for the business and as a result of that I remain very possibly that things will turn around.

Medicare Thank you.

Thanks, Frederick <unk>, we'll go now to Lucas Chavez at <unk>, yes, okay.

Frederick we'll go now to Lucas Chavez and UBS Lucas.

So hello, and thanks for having my questions. So the first one is regarding leverage so how did you how we already look can't leverage in the end of the and the next <unk> how do we should look at the 2.52 0.0 target in the near <unk> in the future and the second question is regarding Columbia. So you said.

So hello, thanks for having my questions. So the first one is regarding leverage so how did you how we already looking at leverage in the end of the and the next <unk> how do we should look at the 2.52 0.0 target and then if you're in the future and the second question is regarding Columbia. So you set up.

About the spectrum payments at the end up D or is down in any kind of for renegotiation of negotiation regarding the prices or should we look at as two very a very high prices during the spectrum payment. Thank you.

The spectrum payments at the end up D or is there like any kind of for renegotiation of negotiation regarding the prices or should we look at as two very a very high prices during the spectrum payment. Thank you.

<unk> you can just you word I'm continues to work as a holiday Columbia Lucas everyone's renewing so we're all in the same boat.

<unk> you can just you work and continues to work as a holiday Columbia Lucas everyone's renewing so we're all in the same boat.

All the players in Colombia.

Everyone's put our best bargaining logging position forward.

Everyone's foot.

<unk> bargaining lobbying position forward.

The industry use achieving some relief.

The industry he said shifting some relief.

On the spectrum prices in Columbia remain.

The spectrum prizes in Columbia remain I, even after these Ronald Reagan was incomplete.

I, even after these Ronald Reagan was.

In comparison to international standards <unk>.

So we need a couple of these negotiations which have yielded positive reductions not to the level is that you would expect for international standards, we have a couple of that with.

So we need a couple of these negotiations which have yielded positive reductions not to the level that you would expect for international standards, We a couple of <unk>.

And do you know that we put in place for Telefonica.

Cause jointly with being a better prescription to them how spectrum for the combined network and that obviously helps.

Divide the cost of the spectrum I'm on a larger subscriber base in a single night.

Divide the cost of the spectrum I'm on a larger subscriber based on a single network.

And on your on your leverage our question Lucas stuck I mean leverage has creeped up for us and an increased here in the first half of this year various factors got into that in terms of what's your <unk> back to dark or that balances you know some of these reason we anticipated I mean, there is seasonality as we go and I'd like to my cash flow. So.

And on your on your leverage our question Lucas book, I mean leverage has creeped up for us and an increased here in the first half of this year various factors got into that in terms of what's it back that are <unk> are dead balances you know some of these reason we anticipated I mean, there is seasonality is we only highlight of our cash flow. So.

<unk> there is a cash outflow you are the first half of this year on year on E. S. Yeah.

<unk> there is a cash outflow you're in the first half of this year on year on E. S. Yes.

And there was someone else on average, which we anticipated, but if somebody does we didn't anticipate this year I mean, we provide a lot of them in our in our pre announcement you know in June in terms of some higher spectrum costs. Some higher interest costs you know that.

And there was someone else on average, which we anticipated.

But there's somebody does we didn't anticipate this year I mean, we've highlight a lot of them in our in our pre announcements in June in terms of some higher spectrum costs. Some higher interest costs. You know that are that are that are hitting us on the equity free cash flow side here. The first half of this year, we've highlighted mm several one offs on the <unk>.

That are that are hitting us on the equity free cash flow side here. The first half of this year, we've highlighted mm several one offs on the <unk> and kind of nonrecurring an unusual items on the EBIT a side, which will ultimately lapsed those I Wanna know T M basis, but but they are putting pressure on the leverage ratio of your you know in the short term.

Non-recurring an unusual items on the <unk> side, which will ultimately laps those on an L. P N basis, but but they are putting pressure on the leverage ratio up here you know in the short term.

There's other items like F X actually which you know I'd like to see the appreciation of the <unk> in Columbia overall, but on the short term basis, you know like a 10% appreciation you know in the in the cops. You know this quarter is that means we have to mark to market that that you know, which is all local currency basis 10 per cent.

There's other items like F X actually which you know I'd like to see the appreciation of the <unk> in Columbia overall, but on the short term basis, you know like a 10% appreciation you know in the in the cops. You know this quarter is that'd mean, we have to mark to market that that you know, which is all local currency basis, 10%.

Higher than it was just three months ago. So that's driven some hired that balances and on the flip side. We still have a you know a cop. That's on an average rate you know over 10 per cent lower than it was a year ago. So that's hurting us on the <unk> side. So it's kind of an unusual dynamic which you know that relationship will you know will correct itself over time, but you know it is having some short term.

Higher than it was just three months ago. So that's driven some higher debt balances and on the flip side. We still have a you know a cough. That's on an average rate you know over 10% lower than it was a year ago. So that's hurting us on the <unk> side. So it's kind of an unusual dynamic which you know that relationship will you know will correct itself over time, but you know it is having some short term.

I'll just.

I was asked for longer term and are raised you know look we you know we did mm mm revise our outlook for equity free cash flow you know over you know over the three year period.

S for longer term <unk> you know look we you know we did mm mm revise our outlook for equity free cash flow you know over you know over this three year period.

It's gonna have an impact in terms of where we think we can get you know our leverage to 2.5 times you know expect that's about a year a year later now 2026 versus you know what we are guided towards it turns it before of 2025 to getting the 2.5 times target.

It's gonna have an impact in terms of where we think we can get you know our leverage to 2.5 times I expect that's about a year a year later now 2026 versus you know what we are guided towards it turns it before of 2025 to getting the 2.5 times target.

But look I think our our objective here is to is to drive that equity free cash flow. You know, we do expect 2024 to be a H. The best year of this three year period for the number of the items, we talked about four nowhere spectrum lower spectrum costs, the benefits of Evers coming through improvements improvements in you know in in Guatemala from the investments were making their.

To you know to drive up our performance and we want to get too and of course, the cash flow of 2024. That's you know, they're a strong sustainable level that we can grow from and and and to get their we're gonna have to deliver kind of on the other priorities in recent mentioned at the end about is the end of his prepared remarks.

<unk> you know to drive up our department. So we want to get too and a quick free cash flow of 2024. That's you know you're a strong sustainable level that we can grow from and and to get their we're gonna have to deliver kind of on the other priorities that retail mentioned at the end about is the end of his prepared remarks.

There was very clear thank.

Thank you Lucas So now we're gonna go to Stefan word of tomato partners.

<unk>.

Okay.

You're on mute Stefan.

Your onions Stefan.

Is it better yes.

Oh, you went back on mute Stefan.

Oh, you went back on me a server.

I'm trying to read your names, but yeah.

Well.

Oh.

Okay.

The amount of trash sorry.

Sorry.

Well I'm wanting to sell more.

One one is the most strategic character about the home business houses. So how should we think about this business.

More strategic character about the home business, how to sort of how should you think about this business and <unk>.

Two three year perspective, it started to decline in a number of our customer relationships.

Two three year prospective it started to decline in a number of our customer relationships second quarter in a row. If you could help me, they're a little bit about how to think of that.

Second quarter in a row, if you could help me, they're a little bit about how to think of that.

And the second question in regards to the legal fees. If you can help me understand how they can be so big and they basically softball, well the savings from the Everest.

The second question in regards to the legal fees. If you can help me understand how they can be so big and they basically softball, well the savings from the Everest.

It's not related to that of course, but but still at the at the comparison you say the Saint cloud <unk>, but if I understood correctly $18 million in legal fees related to <unk>.

Not related to that of course, but but still it's a as a comparison.

The same plus <unk>, but if I understood correctly 18 million illegal fees related to.

<unk> Oh no.

<unk> I guess I'll go to your control. So that is submit all I have to think of mobile illegal fees basically going forward.

I guess I'll go to your control so that is submit how how to think of mobile immediate freeze basically going forward and then if if I'm not sure about the timing of <unk>, you might have mentioned that but I missed it and.

If if I'm not sure about the timing of <unk>, you might have mentioned that but I missed it and.

If not the if you can update on the timing scheduled for for any possible transactions sounds good too.

It's not good if you can update on the time, we scheduled for for any possible transactions sounds good too.

Thanks.

<unk> Oh.

Sure Oh.

Lots of <unk> dress them all somewhat in order.

Lots of <unk> jacking, not address the mall somebody in order.

Listen to home business overall is for the longterm. Your question was a longterm whatnot not up today kind of question.

Okay, it's predicated on broadband penetration into the household.

Okay.

Predicated on broadband penetration into the household.

And those broadband penetration into the household as in the region.

And those broadband penetrations into the household in the region.

Somewhere between 30% to 52% of total cloud in the region.

Somewhere between 30% to 50% of total cloud in the region badge, a little hiring more developed markets like Costa Rica, Colombia, and Panama unless in other markets shoulder all the trend for the business will be one of <unk> information into more and more of the middle.

It's a little higher more developed markets like Costa Rica, Colombia, and Panama unless in other markets shoulder all the trend for the business will be one of penetration in more and more of the middle class that continues to reform and diseconomies adopt.

Class that continues to be form and diseconomies adopt.

Adopt broadband going forward. So we remain bullish on that longterm.

Dobbs broadband going forward. So we remain bullish on that longterm.

I've got <unk>.

I call it a broadband.

I call it broadband.

Eventually become more of a broadband at a pay television business hold they'll pay to me is still healthy in a region.

Eventually become more of a broadband at a P. T V business hold they'll pay to me is still healthy in a region.

So it is all about household formation middle class formation GDP grows on broadband adoption and that will continue to be for the longterm your policy trend.

So it is all about hospital information Middle class formation GDP grows on broadband adoption and that would continue to be for the longterm you possibly be trained.

Now when you look at the.

They already have.

They already.

<unk> ratios do you need to do a couple Central America from Bolivia from Paraguay, I'm from Columbia, because the dynamics are a little bit different Central America continues to grow healthily, and then you'll see that business own business in Central America.

<unk> ratios do you need to do a couple Central America from Bolivia from Paraguay, I'm from Columbia cause the dynamics are a little bit different Central America continues to grow healthily, and then you'll see that business own business in Central America.

See new integral help any.

See new integral help that.

Columbia I addressed earlier.

Dude is soft or for macro but also for competition.

Considerations in Colombia, and it's a perfect part for the business and then Bolivia. We also address quite significantly that's macro related one the country come short of space.

Concentrations in Colombia, and it's a perfect part for the business and then Bolivia, We also address quite significantly that's macro related one <unk>.

Loud.

Macro uncertainty.

A class formation local back in place in Brooklyn, a doctor will come to you when that happens to Stefan is very difficult to tell because it's macro.

No class formation will go back in place in Brooklyn, a doctor will come to you when that happens you Stefan is very difficult to tell because it's macro.

<unk>. This is why I make the difference is is simply running really really well across all lines of businesses, including home in Paraguay Uhm. So that gives you a sort of a big picture longterm view of home.

<unk>. This is why I make the difference is is simply running really really well across all lines of businesses, including home in butterfly Uhm. So that gives you a sort of a big picture longterm view of home.

The legal cause cause related to.

Cooperating with the U S authorities.

It's a big number stuffed up no doubt.

Uhm no doubt is a big number.

Sheldon mentioned.

There's nothing new in the case.

Other than corporation with the authorities and that's what it is is producing documentaries gametes answering questions is healthy they review of things is coffee.

Then corporation with the authorities and that's what it is is producing documents missingham is answering questions. He was helping that review of things is cost me.

<unk>.

<unk> <unk>.

<unk> absolutely.

Absolutely right thing to do or the longterm.

Absolute right thing to do.

Longterm.

If it makes you feel any better.

It makes you feel any better.

This was a laptop.

In the sense that you know, it's hurting our growth.

And we believe where where.

The <unk> the most of the Corporation.

<unk> <unk> the most of the Corporation.

It mathematically lap South next year, when it's already into the cockpit and your options do right.

Mathematically lifestyle next year, when it's already into the cockpit and your options do right.

One of the reasons why we're doing everything else, we can everywhere else be as efficient as we possibly can not just because of this.

This is one more reason why women to be more efficient across the board because there are some expenses.

This is one more reason why we need to be more efficient across the board because there are some expenses.

[laughter].

We just need for you Sir.

I was on hold there Lucky I think we've already addressed fully.

I was on hold there.

Not yet.

Already addressed fully and and while we're on <unk>, we continue to make quite a bit of progress across the board.

And while we're on <unk>, we continue to make quite a bit of progress across the board.

Weaver now <unk> <unk> project.

Now <unk>.

Piloting in Paraguay on the lending project.

And we are please now with having reached possibly Polish margins on the lending we're doing in Paraguay, that's might be positive message.

We are pleased now with having reached possibly Polish margins on lending we're doing in Paraguay, that's might be positive message.

We're launching in Panama as we speak.

We're launching in Panama as we speak and we're very happy with your your results in about two months <unk> or getting a subscribers and the team is very happy with the product the saving <unk> and in the process. We've learned a whole bunch of things one focusing on <unk>.

We're very happy with you already results in about two months.

<unk>, we're getting those subscribers.

<unk> is very happy with the product the saving <unk> and in the process, we've learned a whole bunch of things one focusing on the key countries.

Countries.

<unk> us much better understanding of what this business can do.

<unk> much better understanding of what this business can do.

Why.

<unk> key markets for us.

<unk> is working on work you got it working.

<unk> <unk> <unk> <unk> <unk>.

Our largest market.

A number three this is very important in terms of our journey.

A number three and this is very important in terms of our journey.

Dot product cheaper money product is.

Dot product at Cheapo money product is.

Very very connected.

Very connected.

The rest of our offerings.

Only because of the brown, but also because the customer base, but also because it drives higher M. P. S.

Only because of the brand, but also because the customer base, but also because it drives higher M. P. S.

Cause customers view it as a sticky part of our offerings. So we have learned a lot. We continue to learn a lot and I'll tell you. This bush still learning.

Cause customers view it as a sticky part of our offerings. So we have learned a lot. We continue to learn a lot and I'll tell you This force field learning.

Value of that product so in terms of timing because I don't want to leave your question answered we are now in no rush.

The value of that product. So in terms of timing cause I don't want to leave your question answered.

Now with no rush.

We actually want to learn more of the strength.

All of this business the value of its business.

This business the value of its business.

Or more focused on getting locked me out the door and then would come back on the T Mo money and better understand what we have we're getting approached on it but we really need to be you know breathing disciplined and understanding what we have and I'm getting too deep understanding before we pull the trigger on anything.

Or more focused on getting locked you out the door.

Come back on Tivo money and better understand what we have we're getting approached on it.

But we really need to be you know brilliant disciplined in understanding why we have.

Getting to that deep understanding before we pulled the trigger or anything.

Okay.

Thanks <unk>.

Thanks, <unk> and then we'll take our last question from US that's uncle Seinfeld D. N D. I think it's an ordeal only lines to find that you can hear US go ahead.

And then we'll take our last question from <unk> from G. N D. I think it's an ordeal only lines to find that you can hear US go ahead.

Okay.

<unk>.

Stefan your maybe on mute.

Stefan you may be on mute.

Okay.

Last call [laughter].

Alright, well, we're right on the hour anyway. So I think we can probably about wrap it up there by myself.

Alright, well, we're right on the hour anyway. So I think we can probably about wrap it up there by yourself.

Oh, thanks, everyone for joining today I'm Super very clear what are key for initiatives are on what they're aiming towards getting the business to a steady.

Thanks, everyone for joining today I'm Super very clear what are key for initiatives are on what they're aiming words.

The business to a steady stream.

Long <unk> by the end of 2024, and that's what we're focused on thanks very much for joining us today.

Wrong password <unk> by the end of 2024, and that's what we're focused on thanks very much for joining us today.

Thank you.

[music].

Goodbye.

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