Q2 2024 Liberty Latin America Ltd Earnings Call

Today's call is being recorded. I will now turn the call over to Danilo Fernandez, Senior Director of Corporate Business, CNW Panama.

Unknown Executive: Corporate Business, C&W Panama

Unknown Executive: Good morning and welcome to Liberty Latin America's second quarter 2024 investor call. At this time, all participants are in this and only mode.

Speaker Change: Good morning and welcome to Liberty Latin America's second quarter 2024 investor call. At this time, all participants are in listen-only mode.

Unknown Executive: Today's formal presentation materials can be found in the investor relations section of Liberty Latin America's website at www.lla.com. Following today's formal presentation, instructions will be given for a question and answer session. As a reminder, this call is being recorded.

Speaker Change: Today's formal presentation materials can be found under the Investor Relations section of Liberty Latin America's website at www.lla.com.

Unknown Executive: Cooper Business C&W Panama www.nla.com. Following today's formal presentation, instructions will be given for a question-and-answer session. As a reminder, this call is being recorded.

Speaker Change: Following today's formal presentation, instructions will be given for a question-and-answer session. As a reminder, this call is being recorded.

Unknown Executive: Today's remarks may include forward-looking statements, including the company's expectations with respect to its outlook and future growth prospects, and other information and statements that are not historical facts. Actual results may differ materially from those expressed or implied by this statement.

Unknown Executive: Today's remarks may include forward-looking statements, including the company's expectations with respect to its outlook and future growth prospects, and other information and statements that are not historical facts. However, actual results may differ materially from those expressed or implied by these statements. For more information, please refer to the risk factors discussed in Liberty Latin America's most recently filed annual report on Form 10-K and quarterly report on Form 10-Q, along with the associated press release.

Speaker Change: Today's remarks may include forward-looking statements, including the company's expectations with respect to its outlook and future growth prospects, and other information and statements that are not historical facts.

Speaker Change: Actual results may differ materially from those expressed or implied by this statement.

Unknown Executive: For more information, please refer to the recent factors discussed in Liberty Latin America's most recently filled annual report on Form 10-K and quarterly report on Form 10-Q.

Speaker Change: For more information, please refer to the risk factors discussed in Liberty Latin America's most recently filled annual report.

Unknown Executive: Along with the associated press release, Liberty Latin America disclaims any obligation to update any forward-looking statement or information to reflect any change in its expectations or in the conditions on which any such statement or information is based. In addition, on this call, we will refer to certain non-GAAP financial measures, which are reconciled to the most comparable GAAP financial measures, which can be found in the appendices to this presentation, accessible under the investor section of our website.

Unknown Executive: Liberty Latin America disclaims any obligation to update any forward-looking statement or information to reflect any change in its expectations or in the conditions on which any such statement or information is based. In addition, on this call, we will refer to certain non-GAAP financial measures which are reconciled to the most comparable GAAP financial measures, which can be found in the appendices to this presentation, which is accessible under the investor section of our website. I would now like to turn the call over to our CEO, Mr. Balan Nair.

Danilo Fernandez: I would now like to turn the call over to our CEO, Mr. Balanero.

Balan Nair: Thank you, Danilo, and welcome everyone to Liberty Latin America's second quarter and first half results presentation. I'll begin with our group highlights and an overview of our operating results by reporting segment. Chris Noyes, our CFO, will then follow with a review of the company's financial performance.

Balan Nair: Hello and welcome everyone to Liberty Latin America's second quarter and first half results presentation. I'll begin with our group highlights and an overview of our operating results by reporting segment. Chris Noyes, our CFO, will then follow with a review of the company's financial performance. After that, we will get straight to your questions.

Speaker Change: Thank you, Danilo, and welcome everyone to Liberty Latin America's second quarter and first half results presentation. I'll begin with our group highlights and an overview of our operating results by reporting segment.

Balan Nair: After that, we will get straight to your questions. As always, I'm joined by my executive team from across the region, and I will invite them to contribute as needed during the Q&A following up prepared remarks.

Chris Noyes: Chris Noyes, our CFO , will then follow with a review of the company's financial performance.

Balan Nair: As always, I'm joined by my executive team from across the region, and I will invite them to contribute as needed during the Q&A following a prepared remark. As a point of housekeeping, we will both be working from slides, which you can find on our website at www.LLA.com.

Chris Noyes: After that, we will get straight to your questions.

Balan Nair: As a point of housekeeping, we will both be working from slides, which you can find on our website at www.lla.com. Starting on slide 4, in our highlights, we continue to grow our high-speed broadband and post-paid mobile bases in the first half, adding 62,000 subscribers in total across the group. This was close to 200,000 additions, excluding Puerto Rico, where we experienced specific challenges related to the completion of mobile subscriber migration and the sunset of the ECF program, which I'll cover later in the presentation. We reported the adjusted Oybida of 763 million in the first half. This included double-digit rebase growth in Panama and Costa Rica, in addition to high single-digit growth in Cable and Wireless Caribbean.

Chris Noyes: As a point of housekeeping, we will both be working from slides, which you can find on our website at www.LLA.com.

Balan Nair: Starting on slide four, and I'll highlight it. We continue to grow our high-speed broadband and postpaid mobile business on a quarterly basis, adding 62,000 subscribers in total across the group. This was close to 200,000 additions, excluding Puerto Rico, where we experienced specific challenges related to the completion of mobile subscriber migration and the sunset of the ECF program, which I'll cover later in the presentation. We reported adjusted OEBD of $763 million in the first half.

Speaker Change: This was close to 200,000 editions, excluding Puerto Rico, where we experienced specific challenges related to the completion of mobile subscriber migration and the sunset of the ECF program, which I'll cover later in the presentation.

Speaker Change: We reported adjusted OEBD of $763 million in the first half.

Balan Nair: This included double-digit rebate growth in Panama and Costa Rica, in addition to high single-digit growth in cable and wireless Caribbean. We expect these businesses to continue their momentum in the second half and growth for the overall group to improve as we drive better results in our Puerto Rico operation. We have been aggressive with our buyback activity this year, including the redemption of our convertible notes in July. We have now repurchased over $300 million of our equity and convertible bonds, which is equivalent to the total capital allocated during 2020.

Balan Nair: We expect these businesses to continue their momentum in the second half and growth for the overall group to improve as we drive better results in our Puerto Rico operations. Our buyback activity this year, including the redemption of our convertible notes in July, we have now repurchased over $300 million of our equity and converts, which is equivalent to the total capital allocated during 2023. Finally, we continue to look at inorganic ways in which to drive additional stakeholder value, and we are excited to announce our combination with Millicom in Costa Rica. This will improve the market structure, drive synergies, and importantly, allow us to invest in fiber and 5G, delivering even better services for the Costa Rican people.

Speaker Change: We expect these businesses to continue their momentum in the second half and growth for the overall group to improve as we drive better results in our Puerto Rico operations.

Speaker Change: We have been aggressive with our buyback activity this year, including the redemption of our convertible notes in July . We have now repurchased over $300 million of our equity and converts, which is equivalent to the total capital allocated during 2023.

Balan Nair: Finally, we continue to look at inorganic ways in which to drive additional stakeholder value, and we are excited to announce our combination with Milicom in Costa Rica. This will improve the market structure, drive synergies, and importantly, allow us to invest in fiber and 5G, delivering even better services for the Costa Rican people. Turning to slide five, I'll begin our operating review with cable and wireless.

Balan Nair: Turning to slide 5. I'll begin our operating review with Kibbel and Wireless Caribbean. On the left of the slide, we present our internet and mobile ball spade additions, where, over the past 12 months, we've added 80,000 subscribers in total. Q2 saw flat broadband subscriber performance as our price increases resulted in higher change during the quarter, which was in line with our expectations. Importantly, we continue to deliver year-over-year revenue growth, and we expect underlying improvements in the second half, although anticipating some one-time impacts resulting from Hurricane Barrow, primarily in Jamaica. Post-paid mobile ads remain robust, driven by another solid quarter in Jamaica, where we've now added subscribers for 16 consecutive quarters.

Speaker Change: Turning to slide five.

Balan Nair: On the left of the slide, we present our Internet and Mobile Postpaid Edition, where over the past 12 months, we've added 80,000 subscribers in total. Q2 saw flat broadband subscriber performance as our price increases resulted in higher churn during the quarter, which was in line with our expectations. Importantly, we continue to deliver year-over-year revenue growth, and we expect underlying improvements in the second half, although we are anticipating some one-time impacts resulting from Hurricane Barrel, primarily in Jamaica.

Speaker Change: I'll begin our operating review with cable and wireless Caribbean.

Speaker Change: where over the past 12 months we've added 80,000 subscribers in total.

Speaker Change: Q2 saw flat broadband subscriber performance as our price increases resulted in higher churn during the quarter, which was in line with our expectations.

Speaker Change: Importantly, we continue to deliver year-over-year revenue growth, and we expect underlying improvements in the second half, although anticipating some one-time impacts resulting from Hurricane Barrel, primarily in Jamaica.

Balan Nair: Postpaid mobile ads remain robust, driven by another solid quarter in Jamaica, where we've now added subscribers for 16 consecutive quarters. Moving to the center of the slide, we generated 4% revenue growth in the first half of this year. As our consumer momentum was bolstered by strong B2B performance through the award of some notable projects. Lastly, for cable and wireless, I want to provide an update following Hurricane Beryl, which impacted our operations in Jamaica, Grenada, St. Vincent, and the Grenadines in early July. Most importantly, we were very grateful that our colleagues were saved through the storm.

Balan Nair: Moving to the center of the slide, we generated 4% revenue growth in the first half of this year. That's our consumer momentum was bolstered by strong B2B performance through the award of some notable projects. Lastly, for Kibbel and Wireless, I want to provide an update following Hurricane Barrow, which impacted our operations in Jamaica, Grenada, St. Vincent, and the Grenadians in early July. Most importantly, we were very grateful that our colleagues were saved through the storm. These territories did, however, suffer some infrastructure damage, and we have had teams working around the clock to get our services back up and running.

Speaker Change: Moving to the center of the slide, we generated 4% revenue growth in the first half of this year. As our consumer momentum was bolstered by strong B2B performance through the award of some notable projects.

Speaker Change: Most importantly, we were very grateful that our colleagues were saved through the storm.

Balan Nair: These territories did, however, suffer some infrastructure damage, and we have had teams working around the clock to get our services back up and running. We're pleased to confirm that, on average, across our impacted markets, over 90 percent of our fixed and mobile network coverage is online, and this number continues to grow.

Speaker Change: These territories did, however, suffer some infrastructure damage, and we have had teams working around the clock to get our services back up and running.

Balan Nair: We're pleased to confirm that, on average, across our impacted markets, over 90% of our fixed and mobile network coverage is online, and this number continues to grow. As ever, in these situations, we are dependent on the power companies reinstating networks so that we can deliver services, and this is an ongoing process. Chris will discuss in more detail, but our expected operational and financial impacts are manageable, and we expect our parametric program will cover the cash flow impact. CNW Caribbean remains on a great trajectory, and we are working with our communities to recover as soon as possible.

Balan Nair: As ever, in these situations, we are dependent on the power companies reinstating the networks so that we can deliver services, and this is an ongoing process. Chris will discuss this in more detail, but our expected operational and financial impacts are manageable, and we expect our parametric program will cover the cash flow impact. CNW Caribbean remains on a great trajectory, and we are working with our communities to recover as soon as possible. Moving to slide six in our CNW Panama segment, starting on the left of the slide, we re-delivered another solid quarter of internet subscriber growth and Robust Revenue Growth.

Speaker Change: As ever, in these situations, we are dependent on the power companies reinstating networks so that we can deliver services, and this is an ongoing process.

Speaker Change: CNW Caribbean remains on a great trajectory, and we are working with our communities to recover as soon as possible.

Balan Nair: Moving to slide six, and our CNW Panama segment, starting on the left of the slide, we delivered another solid quarter of internet sub-tribe editions and robust revenue growth. Our go-to-market strategy is not delivering system results across our high-speed network, and we expect this to continue through the rest of the year. In mobile, we reported an exceptional quarter, adding a record number of over 50,000 post-paid subscribers as we successfully won a significant number of customers who came into the market following DG Cells' exit earlier this year. As well as fixed networking investments, we are also investing in mobile with successful 5G trials during the May elections, showing technology leadership in the market.

Balan Nair: Our go-to-market strategy is now delivering consistent results across our high-speed network, and we expect this to continue through the rest of the year. In mobile, we reported an exceptional quarter, adding a record number of over 50,000 postpaid subscribers, as we successfully won a significant number of customers who came into the market following Digicel's exit earlier this year, as well as fixed network investments. We are also investing in mobile, with successful 5G trials during the May elections, showing technological leadership in the market.

Speaker Change: Our go-to-market strategy is now delivering consistent results across our high-speed network, and we expect this to continue through the rest of the year.

Speaker Change: In mobile, we reported an exceptional quarter, adding a record number of over 50,000 postpaid subscribers as we successfully won a significant number of customers who came into the market following Digicel's exit earlier this year.

Speaker Change: As well as fixed network investments, we are also investing in mobile with successful 5G trials during the May elections showing technology leadership in the market.

Balan Nair: Moving to the center of the slide, we drove 6% top-line growth in the first half, with contributions coming from all of our product areas. Overall, we are creating an exciting platform in Panama and are well-positioned to continue the momentum we have built during the first half of the year.

Balan Nair: Moving to the center of the slide, we drove 6% top-line growth in the first half, with contributions coming from all of our product areas. Overall, we are creating an exciting platform in Panama and are well positioned to continue the momentum we have built during the first half of the year. Turning to slide seven, and to Liberty, Puerto Rico, starting on the left of this slide.

Speaker Change: Overall, we are creating an exciting platform in Panama and are well positioned to continue the momentum we have built during the first half of the year.

Balan Nair: Turning to slide 7 and Liberty Puerto Rico, starting on the left of the slide, we reported a stable quarter of Internet subscriber ads. Fixed revenues flat year over year as growth in our RGU base over the past 12 months was offset by reduced our full following retention office, including for our ACP base, which has been indicated on the first quarter call have mostly stayed with us. In mobile, our post-paid subscriber performance was impacted by send factors. Following completion of the migration from AT&T in April, we experienced a disruption across our platforms, which led to increased churn in Q2.

Speaker Change: Turning to slide seven, and Liberty Puerto Rico.

Balan Nair: We reported a stable quarter of internet subscribers, and fixed revenues were flat year over year as growth in our RGU base over the past 12 months was offset by reduced ARPU following retention of, including for ACP, who has been indicated on the first quarter call have mostly stayed, but in mobile, our postpaid subscriber performance was impacted by SinFact. Following completion of the migration from AT&T in April, we experienced some disruption across our platform, which led to increased churn in Q2. We also saw the final quarterly impact of ECF funding being removed for schools in Puerto Rico.

Speaker Change: We reported a stable quarter of Internet subscriber ads. Fixed revenues flat year-over-year as growth in our RGU base over the past 12 months was offset by reduced ARPU following retention offers.

Speaker Change: including for our ACP base, who, as we indicated on the first quarter call, have mostly stayed with us.

Speaker Change: In mobile, our postpaid subscriber performance was impacted by certain factors.

Balan Nair: We also saw the final quarterly impact of ECF funding being removed for schools in Puerto Rico. This drove a total of 39,000 subscriber losses in Q2 and 74,000 of losses over the past year. As mentioned on the last quarter's call, our pool for these customers is left in half our average across the base. We expect our operating performance to improve and saw some green shoots in our pre-paid segment during the second quarter as we added over 2000 subscribers, which was only our second positive quarter since we acquired the AT&T operation in 2020. In the center of the slide, we show the revenue mix by product in Puerto Rico and the first half year-over-year decline of 11%.

Balan Nair: This drove a total of 39,000 subscriber losses in Q2 and 74,000 losses over the past. As mentioned on the last quarter's call, our pool for these customers is less than half our average across the base. We expect our operating performance to improve and saw some green shoots in our prepaid segment during the second quarter as we added over 2,000 subscribers, which was only our second positive quarter since we acquired the AT&T operation in 2020.

Speaker Change: We expect our operating performance to improve and saw some green shoots in our prepaid segment during the second quarter as we added over 2,000 subscribers, which was only our second positive quarter since we acquired the AT&T operation in 2020.

Balan Nair: In the center of the slide, we show revenue mixed by product in Puerto Rico and the first half year over year decline of 11%. Chris will cover the financial puts and takes in greater detail within his section.

Balan Nair: Chris will cover the financial puts and takes in greater detail within his section.

Speaker Change: Chris will cover the financial puts and takes in greater detail within his section.

Balan Nair: I will provide more color on our Puerto Rico story in the next slide. But we want to be very clear that our long-term message remains consistent. We have expected greater sequential adjusted ABDA expansion in the second quarter. However, some unanticipated factors affected our performance. And this has led to a small shift in our target timeline to achieve send-off. The full effect of synergies and cost savings are still expected in the third and fourth quarters, as we have previously indicated. These synergies, operating cost improvements, and top-line sequential growth with FMC should drive adjusted Oyveda to more than $45 million per month in the second half.

Balan Nair: I will provide more color on our Puerto Rico story in the next slide, but we want to be very clear that our long-term message remains consistent. We had expected greater sequential adjusted EBITDA expansion in the second quarter. However, some unanticipated factors affected our performance, and this has led to a small shift in our target timeline to achieve certain milestones.

Chris Noyes: I will provide more color on our Puerto Rico story in the next slide, but we want to be very clear that our long-term message remains consistent.

Chris Noyes: We had expected greater sequential adjusted EBITDA expansion in the second quarter. However, some unanticipated factors affected our performance, and this has led to a small shift in our target timeline to achieve certain milestones.

Balan Nair: The full effect of synergies and cost savings is still expected in the third and fourth quarters, as we had previously indicated. These synergies, operating cost improvements, and top-line sequential growth with FMC should drive Adjusted Oivida to more than $45 million per month in the second half, however, now towards the end of the year, still setting us up for significant expansion in adjusted OEBDA for 2025. Moving to slide eight, we wanted to provide an overview of execution today, challenges we've faced, and our next steps to drive significantly improved results in Puerto Rico, starting with the commercial side of the business.

Chris Noyes: The full effect of synergies and cost savings are still expected in the third and fourth quarters as we have previously indicated.

Chris Noyes: These synergies, operating cost improvements, and top-line sequential growth with FMC should drive adjusted OEVIDA to more than $45 million per month in the second half, however, now towards the end of the year.

Balan Nair: However, now towards the end of the year. Still setting us up for significant expansion in the adjusted Oyveda for 2025.

Chris Noyes: Still setting us up for significant expansion in adjusted OEBDA for 2025.

Balan Nair: Moving to slide 8, we wanted to provide an overview of execution today. Challenges we've faced and our next steps to drive significantly improved results in Puerto Rico. Starting with the commercial side of the business. In terms of execution, we have consistently reported solid subscriber additions across our fixed operations over many years. Fix revenue represents 40% of our Puerto Rico total. And so this remains a strong, strong foundation for the business. In mobile, we were able to maintain the stable post-paid base until migration began. This is a market structure where we can stabilize and grow share.

Balan Nair: In terms of execution, we have consistently reported solid subscriber additions across our fixed operations for many years; fixed revenue represents 40% of our Puerto Rico total. And so this remains a strong foundation for the business. In mobile, we were able to maintain a stable postpaid base until migration began. This is a market structure where we get stabilized and grocery.

Chris Noyes: starting with the commercial side of the business.

Chris Noyes: In terms of execution, we have consistently reported solid subscriber additions across our fixed operations over many years. Fixed revenue represents 40% of our Puerto Rico total, and so this remains a strong foundation for the business.

Chris Noyes: In Mobile, we were able to maintain a stable postpay base until migration began. This is a market structure where we can stabilize and grow share.

Balan Nair: The prepaid performance I mentioned on the prior slide is just the beginning. In terms of challenges, during and following the migration, we have seen subscriber losses across our postpaid and prepaid bank, albeit some Q2 improvements in prepaid, which was the first segment to be migrated. We were also impacted by the ECF program sunset, which is now completed.

Balan Nair: The prepaid performance and mention on the price slide is just the beginning. In terms of challenges, during and following the migration, we have seen subscriber losses across our post-paid and prepaid basis. I'll be at some Q2 improvements in prepaid, which was the first segment to be migrated. We were also impacted by the ECF program sunset, which is now completed. Importantly, we now have a tremendous opportunity to leverage a full-service product to drive FMC penetration from current levels of around 25%. In mobile, we have a market share around 20%, and there is clearly significant room to grow as we ramp up our commercial efforts.

Chris Noyes: The prepaid performance I mentioned on the prior slide is just the beginning.

Chris Noyes: In terms of challenges, during and following the migration, we have seen subscriber losses across our postpaid and prepaid basis.

Chris Noyes: albeit some Q2 improvements in prepay, which was the first segment to be migrated. We were also impacted by the ECF program sunset, which is now completed.

Balan Nair: Importantly, we now have a tremendous opportunity to leverage a full service product to drive FMC penetration from current levels of around 25%. In mobile, we have a market share of around 20%, and there is clearly significant room to grow as we ramp up our commercial efforts. Moving on to operational aspects The key execution point here was completing the migration in a timely manner. From an execution perspective, we have successfully managed to sustain and grow our fixed revenue for a number of years. We have also mostly exited the TSA, and expect minimal costs in the second half.

Chris Noyes: In mobile, we have a market share around 20% and there is clearly significant room to grow as we ramp up our commercial efforts.

Balan Nair: The acquisition of dishes boosts subscribers and spectrum, which we expect closing in Q3 is an exciting addition and catalyst here.

Balan Nair: Moving to operational aspects, the key execution point here was completing the migration in April. This is a complex undertaking for any operator, and we experience challenges. In particular, related to mapping and billing as we tried to convert an extensive number of legacy AT&T plans, we'd associate coding to our new platform. We are now to the worst of the disruption and a stabilizing platform so that our commercial colleagues can start driving top-line growth.

Chris Noyes: Moving to operational aspects, the key execution point here was completing the migration in April .

Balan Nair: Finally, the financial areas. From an execution perspective, we have successfully managed to sustain and grow our fixed revenue for a number of years. We have also mostly exited the TSA and expect minimal costs in the second half. Challenges have centered around certain migration-related costs, which are now mostly behind us. As mentioned, the unanticipated factor in Q2 was a decision with our customer relationship in mind to write off 12 million of bad debt. Looking forward, we expect to drive top-line growth through our commercial initiatives, cost efficiencies from our headcount reduction and other initiatives, and drive synergies.

Chris Noyes: Finally, the financial areas.

Balan Nair: Looking forward, we expect to drive top-line growth through our commercial initiatives, cost efficiencies from our headcount reduction, and other initiatives, and drive synergies. To reiterate, we remain very confident of our longer-term plans and excited by the opportunity to return to growth in Puerto Rico. We delivered a solid fixed subscriber performance with net ads similar to the first quarter. In mobile, we reported another strong quarter with growth concentrated in the higher-value post-paid segments, where net ads were over 60% higher compared to the prior year quarter.

Balan Nair: To reiterate, we remain very confident of our longer-term plans and excited by the opportunity to retain the growth in Puerto Rico, tending to slide 9 and Liberty Costa Rica. Starting on the left of the slide, we delivered a solid, fixed subscriber performance, with Nat ad similar to the first quarter. We referenced the challenging competitive backdrop in Costa Rica's fixed market in previous calls. This was one of the drivers for the transaction with Millicom that we have announced. I'll provide more color and that deal in our latest light, but we think it will be great for all stakeholders, particularly our customers.

Chris Noyes: Turning to slide 9, and Liberty Costa Rica.

Chris Noyes: starting on the left of the slide.

Chris Noyes: We delivered a solid fixed subscriber performance with net ads similar to the first quarter.

Chris Noyes: We've referenced the challenging competitive backdrop in Costa Rica's fixed market in previous calls. This was one of the drivers for the transaction with Millicomp that we have announced.

Chris Noyes: I'll provide more color on that deal in a later slide, but we think it will be great for all stakeholders, particularly our customers.

Balan Nair: In mobile, we reported another strong quarter, which growth concentrated in the higher value post-paid segments, where Nat ads were over 60% higher compared to the prior year quarter. Following successful trials, we were first to market with a commercial 5G offering in July, further reinforcing our technology and service leadership in the market. Moving to the center of the slide, we reported how the rebase revenue growth was 6% in the first half, led by Mova.

Balan Nair: Moving to the center of the slide, we've reported healthy rebate revenue growth of 6% in the first half, led by mobile. Enterprise continues to be our fastest area of growth, rising by 11% on a rebate basis year over year. These are great forums for our teams to showcase our capabilities to customers while at the same time getting valuable insights into their needs. Despite facing a year-over-year decline in IRU non-cash revenues, our wholesale business continues to demonstrate resilience.

Chris Noyes: Moving to the center of the slide, we reported healthy rebates revenue growth of 6% in the first half, led by Mobile.

Balan Nair: Next, to slide 10 and our final segment, Liberty Networks. On the last side of the slide, we present revenue for current and prior year of first half. Enterprise continues to be of fastest area of growth, rising by 11% on a rebase basis year over year. This performance was driven by connectivity growth and higher value added services, penetration as customers migrate the mission critical operations on our cloud infrastructure. To help drive this growth, we host events such as our annual Data Center and Cyber Security Summit. These are great forums for our teams to showcase our capabilities to customers, while at the same time getting valuable insights into their needs.

Chris Noyes: On the left side of the slide, we present revenue for current and prior year first halves.

Chris Noyes: Enterprise continues to be our fastest area of growth, rising by 11% on a rebate basis year over year.

Chris Noyes: To help drive this growth, we host events such as our annual Data Center and Cybersecurity Summit.

Chris Noyes: These are great forums for our teams to showcase our capabilities to customers, whilst at the same time getting valuable insights into their needs.

Balan Nair: Despite facing a year-over-year decline in IRU non-cash revenues, our wholesale business continues to demonstrate resilience. Importantly, we are building a strong foundation of monthly recurring revenues, which bodes well for future prospects. In the center of the slide, we present our revenue split and highlight the strong financial profile of the business. Liberty Networks has an adjusted orbital margin of both 50%, and given its relatively low capital intensity and operating free cash flow drops over 40%.

Chris Noyes: Despite facing a year-over-year decline in IRU non-cash revenues, our wholesale business continues to demonstrate resilience.

Chris Noyes: Importantly, we are building a strong foundation of monthly recurring revenues.

Chris Noyes: which bodes well for future prospects.

Chris Noyes: In the center of the slide, we present our revenue split and highlight the strong financial profile of the business.

Chris Noyes: Liberty Network has an adjusted OEB margin above 50%, and given its relatively low capital intensity, an operating free cash flow drops over 40%.

Balan Nair: Finally, to slide 11 and then update on inorganic moves, we are making to drive additional value. Firstly, taking the left of the slide and last week's announced agreement to combine our operations with Tego and Costa Rica. This transaction will create significant value. In particular, it will improve the fixed market structure, create cost synergies through enhanced scale, bring cross-cell opportunities for FMC across the Tego customer base, create network synergies given significant footprint over and enabled FTTH investment synergies, and compete with the existing three FTTH networks in the country.

Chris Noyes: Finally, to slide 11 and an update on inorganic moves we are making to drive additional value.

Chris Noyes: Firstly, taking the left of the slide and last week's announced agreement to combine our operations with Tigo and Costa Rica.

Balan Nair: This transaction will create significant value. In particular, it will improve the fixed market structure, create network synergies given the significant footprint overlap, and enable FTTH investment synergies and compete with the existing three FTTH networks in the country. Secondly, an update regarding the acquisition of Spectrum and subscribers from DISH, which we announced last November. We have received HSR clearance and anticipate the transaction receiving FCC clearance in Q3. The purchase consideration will be spread across four annual payments from the date of closing, with $99 million due at completion.

Chris Noyes: This transaction will create significant value. In particular, it will improve the fixed market structure, create cost synergies through enhanced scale, bring cross-sell opportunities for FMC across the TIGO customer base.

Chris Noyes: create network synergies given significant footprint overlap.

Chris Noyes: and enable FTTH investment synergies and compete with the existing three FTTH networks in the country.

Balan Nair: Secondly, an update regarding the acquisition of Spectrum and subscribers from Dish, which we announced last November. We receive HSR clearance and anticipate the transaction receiving FCC clearance in Q3. The purchase consideration will be spread across four annual payments from the day of closing, with $99 million due at completion. Our commitment to Puerto Rico and the US Virgin Islands is reflected in this deal, where we will acquire a combination of over 100 megahertz of spectrum and over 110,000 Boost subscribers. Upon completion, this transaction will provide us with valuable spectrum that will allow us to add more capacity, increase speeds, and further strengthen our 5G mobile network, as well as increase our scale in the pre-paid market.

Chris Noyes: Secondly, an update regarding the acquisition of Spectrum and subscribers from DISH, which we announced last November .

Chris Noyes: We receive HSR clearance and anticipate the transaction receiving FCC clearance in Q3.

Chris Noyes: The purchase consideration will be spread across four annual payments from the date of closing, with $99 million due at completion.

Balan Nair: Our commitment to Puerto Rico and the U.S. Virgin Islands is reflected in this deal, where we will acquire a combination of over 100 megahertz of spectrum and over 110,000 boost subscribers. Upon completion, this transaction will provide us with valuable spectrum that will allow us to add more capacity, increase speeds, and further strengthen our 5G mobile network, as well as increase our scale in the prepaid model. With that, I'll pass you over to Chris Noyes, our Chief Financial Officer, who will take you through our financial performance before we move on to your questions.

Chris Noyes: Our commitment to Puerto Rico and the U.S. Virgin Islands is reflected in this deal.

Chris Noyes: where we will acquire a combination of over 100 MHz of spectrum and over 110,000 Boost subscribers.

Christopher Noyes: With that, I'll pass you over to Chris Noyes, our Chief Financial Officer, who will take you through our financial performance before we move on to your questions.

Chris Noyes: With that, I'll pass you over to Chris Noyes, our Chief Financial Officer, who will take you through our financial performance before we move on to your questions.

Balan Nair: Chris, thanks. Ballin.

Christopher Noyes: Thanks, Balan. I'll now take you through our financial results in greater detail, starting with our group revenue and adjusted OEBDAL performance on slide 13. Sequentially, reported revenue grew by 2% to $1.1 billion and adjusted OEBDA was 4% higher at $389 million in the second quarter. Revenue progression in the quarter reflects the positive financial results of the operational actions Balan highlighted, the way the dog road was bolstered by operational leverage with our margin improving by 75 basis points to 34 points. However, year-over-year revenue was 1% lower on a rebase basis and adjusted OEB Similar to revenue, the growth in these segments was more than offset by significant declines in Liberty Puerto Rico and Liberty Networks, both of which we will discuss in subsequent slides. Slide 15 recaps our segment results.

Christopher Noyes: I'll now take you through our financial results in greater detail, starting with our Group revenue and Adjusted OIBIDO performance on Slide 13. Sequentially, a reported revenue group by 2% to $1.1 billion, and Adjusted Oibido was 4% higher at $389 million in the second quarter. Revenue progression in the quarter reflects the positive financial results of the operational action Ballin highlighted. Oibido Growth was bolstered by operational leverage, with our margin improving by 75 basis points to 34.8%.

Chris Noyes: Thanks, Balan. I'll now take you through our financial results in greater detail, starting with our group revenue and adjusted OEBDAL performance on slide 13.

Chris Noyes: Sequentially, reported revenue grew by 2% to $1.1 billion and adjusted OEBDA was 4% higher at $389 million in the second quarter. Revenue progression in the quarter reflects the positive financial results of the operational actions Balan highlighted.

Speaker Change: OEBDAD growth was bolstered by operational leverage with our margin improving by 75 basis points to 34.8%.

Christopher Noyes: Year-over-year revenue was 1% lower on a rebase basis, and adjusted Oibido decline by 12%. Revenue declined slightly as positive momentum in CNW Panama, CNW Caribbean, and Costa Rica was more than offset by declines in Puerto Rico and Liberty Networks. With respect to adjusted OIBIDO, CNW Panama was our best performing segment, posting double-digit rebase growth, and CNW Caribbean delivered high single-digit rebase growth. Similar to revenue, the growth in these segments was more than offset by significant declines in the big Puerto Rico and Liberty Networks, both of which we will discuss in subsequent slides.

Speaker Change: Year-over-year revenue was 1% lower on a rebase basis and adjusted OEBDA declined by 12%.

Christopher Noyes: Moving to Slide 14 and our Peony editions and adjusted FCF results for Q2, on the left, we incurred Peony editions of $180 million in Q2 or 16% of revenue. This compares to $192 million or 17% of revenue last year Q2. During Q2, we built and or upgraded nearly 100,000 homes and launched initial 5G service in Costa Rica and came. On the right, we posted the adjusted FCF before partner distributions of negative $7 million, partner distributions in Bahamas of $11 million, which brought our adjusted FCF to negative $18 million for Q2. This result compares to adjusted FCF of $31 million per Q2 2023.

Speaker Change: This result compares to adjusted FCF of $31 million for Q2 2023.

Christopher Noyes: The primary driver of the year-over-year change was principally related to our lower adjusted FCF. Way to Go.

Speaker Change: The primary driver of the year-over-year change was principally related to our lower-adjusted oevita.

Christopher Noyes: Slide 15 recaps our segment results. Starting with CNW Peruvian, we reported $368 million of revenue in Q2, reflecting 4% rebase growth. Specifically, we achieved another quarter of growth in all three business categories, posting 2% in fixed, 5% in mobile, and 5% in B2B on our rebase basis. The main drivers of higher residential fixed in mobile revenue were higher arpus driven by price increases across the number of markets, and year-over-year subscriber growth in broadband and post-paid. The positive B2B performance was driven by project-related revenue, particularly in the Bahamas. We posted an adjusted OIBIDA of $157 million, representing 8% rebase growth, fueled by the aforementioned revenue growth and discipline on direct and indirect costs.

Speaker Change: Slide 15 recaps our segment results.

Speaker Change: Specifically, we achieved another quarter of growth in all three business categories, posting 2% in fixed, 5% in mobile, and 5% in B2B on a rebase basis.

Christopher Noyes: The main drivers of higher residential fixed and mobile revenue were higher ARPUs driven by price increases across a number of markets and year-over-year subscriber growth in broadband and postpaid. The positive B2B performance was driven by project-related revenue, particularly in the Bahamas. We posted adjusted OEBDA of $157 million, representing 8% rebase growth, fueled by the aforementioned revenue growth and discipline on direct and indirect costs. As a result of our operating leverage, our adjusted OEBDA margin improved by over 150 basis points year-over-year to 43%. Damaged or destroyed network residences and businesses, and loss of power has impacted certain of our customers in these areas. We currently expect to be impacted in revenue and adjusted OEBDA by $10 to $20 million in H2 and will incur an additional $10 to $20 million of P&E additions to repair, replace, and or strengthen

Speaker Change: The positive B2B performance was driven by project-related revenue, particularly in the Bahamas.

Speaker Change: We posted adjusted OEBDA of $157 million, representing 8% rebase growth.

Christopher Noyes: As a result of our operating leverage, our adjusted OIBIDA margin improved by over 150 basis points year-over-year to 43%. As Valin mentioned, Hurricane Barrel impacted our Jamaica, Grenada, and St. Vincent Operations in early July. Damage or destroyed network, residences, and businesses, and loss of power has impacted certain of our customers in these markets. We currently expect to be impacted in revenue and adjusted OIBDA by $10-20 million in H2, and will incur an additional $10-20 million of Pneeditions to repair, replace, and or strengthen our infrastructure. Good progress is being made on our recovery efforts.

Speaker Change: We currently expect to be impacted in revenue and adjusted OEBDA by $10-$20 million in H2 and will incur an additional $10-$20 million of P&E additions to repair, replace, and or strengthen our infrastructure.

Christopher Noyes: Next, moving to Cable Wireless Panama. CWP generated $197 million of revenue, reflecting 9% rebase revenue growth. As in the Caribbean, we've recorded rebase top line growth across all business loans with 4% and 6%, 4% mobile, and 17% in B2B. Growth was mainly fueled by increased sales activity and broadband, increases in prepaid recharge activity, and B2B project rules. We posted $65 million of adjusted OIBIDA in Q2, representing 10% rebase year-on-year growth, with performance driven by revenue growth.

Speaker Change: Next, moving to Cable Wireless Panama.

Speaker Change: CWP generated $197 million of revenue, reflecting 9% rebate revenue growth.

Speaker Change: As in the Caribbean, we recorded rebased top line growth across all business lines with 4% in fixed, 4% in mobile, and 17% in B2B.

Speaker Change: Growth is mainly fueled by increased sales activity in broadband, increases in prepaid recharge activity, and B2B project rules.

Christopher Noyes: Turning to Liberty Networks. We generated $119 million in revenue and $63 million in just the OIBIDA, resulting in rebase declines of 1% and 13% respectively. Whole cell revenue declined due to a roughly $6 million dollar decrease in non-cash RU Emeritization and Accelerations year-over-year, which was partially offset by double-digit growth and enterprise driven by growth in connectivity and IT as a service, mostly in Colombia, Dominican Republic, and Honduras. Our year-over-year decline in adjusted OIBIDA was due to the aforementioned lower IRU revenue and a bad debt adjustment for two large customers of roughly $5 million.

Speaker Change: Our year-over-year decline in adjusted OEBDA was due to the aforementioned lower IRU revenue and a bad debt adjustment for two large customers of roughly $5 million.

Christopher Noyes: Second from the right, Liberty Puerto Rico. Q2 revenue was $309 million, reflecting a 12% rebase decline year-over-year. Residential fixed revenue was down 1% on the back of broadband volume gains in the past 12 months, which were more than offset by lower IRU, primarily due to retention discounts, in part related to ACP retention. Activity. Mobile, however, declined by 21% on a rebase basis driven by mobile subscriber losses in connection to the migration and by a $9 million reduction in equipment sales due in part to the migration impacting commercial activities. B2B revenue declined 6% on a rebase basis driven by the ECF sunset, which led to a reduction of 39,000 subscribers in the quarter and 74,000 in the last 12 months.

Speaker Change: Residential fixed revenue was down 1% on the back of broadband volume gains in the past 12 months, which were more than offset by lower ARPU, primarily due to retention discounts, in part related to ACP retention activities.

Speaker Change: Mobile, however, declined by 21% on a rebase basis, driven by mobile subscriber losses in connection to the migration, and by a $9 million reduction in equipment sales due in part to the migration impacting commercial activities.

Speaker Change: B2B revenue declined 6% on a rebase basis driven by the ECF sunset, which led to a reduction of 39,000 subscribers in the quarter and 74,000 in the last 12 months.

Christopher Noyes: Adjusted Oyvada decreased substantially year over year as we reported $71 million, which reflected a rebase decline of 48% as compared to Q2 2023. The negative year-on-year performance was impacted by lower revenues discussed above and higher op-ex related to the migration, integration activities and impacts, partly offset by lower direct costs, including TSA and Roman. On a sequential basis, adjusted Oyvada improved by 3% as revenue declined, one more offset by lower direct and indirect costs.

Speaker Change: The negative year-on-year performance was impacted by lower revenue, as discussed above, and higher OPEX related to the migration integration activities and impacts, partly offset by lower direct costs, including TSA and RONI.

Speaker Change: On a sequential basis, adjusted OEBDA improved by 3% as revenue declines, or more than offset by lower direct and indirect costs. I'll discuss Puerto Rico's Q2 results more in the next slide.

Christopher Noyes: I'll discuss Puerto Rico's Q2 results more in the next slide. Concluding with Costa Rica on the far right, we deliver Q2 revenue of $147 million in adjusted Oyvada of $53 million, reflecting 4% rebase revenue growth and rebase adjusted Oyvada growth of 1%. All three business lines contributed to the positive top-line performance, with the main driver of organic growth being mobile revenue, which was 8% higher year over year on a rebase basis. Sequentially, our growth was impacted by fixed RPU pressure and lower mobile equipment sales. Adjusted Oyvada only expanded modestly year over year as a result of incremental costs related to our strong commercial activity, including the net impact of quittance in.

Christopher Noyes: Concluding with Costa Rica on the far right, we deliver Q2 revenue of $147 million and adjusted OEBDA of $53 million, reflecting 4% rebase revenue growth and rebase adjusted OEBDA growth of 1%. All three business lines contributed to the positive top line performance, with the main driver of organic growth being mobile revenue, which was 8% higher year over year on a rebase basis. Adjusted OEBDA only expanded modestly over the year as a result of incremental costs related to our strong commercial activity, including the net impact of equipment.

Justin Oyvoda: Justin Oyvoda only expanded modestly year-over-year as a result of incremental costs related to our strong commercial activity including the net impact of equipment sales.

Christopher Noyes: Moving to slide 16, I will present a detailed review of our financial performance in Puerto Rico. Revenue for Q2 was $309 million, representing a sequential decline of $18 million from the $327 million reported in Q1. The decline is due to residential mobile subscriber losses and the loss of ECF subs previously mentioned.

Christopher Noyes: Moving to slide 16, I will present a detailed review of our financial performance in Puerto Rico. Revenue for Q2 was $309 million, representing a sequential decline of $18 million from the $327 million reported in Q1. The decline is due to residential mobile subscriber losses and the loss of ECF subs previously mentioned. In H2, we expect to stabilize the mobile subscriber base as we move past the operational issues on our new platforms and then start to gain momentum to the launch of new offers. Our direct costs and op-ex for Q2 of $238 million continues to be impacted by a number of migration-related items that we expect will largely drop off during H2.

Justin Oyvoda: Moving to slide 16, I will present a detailed review of our financial performance in Puerto Rico.

Christopher Noyes: In H2, we expect to stabilize mobile subscriber as we move past the operational issues in our new platforms and then start to gain momentum through the launch of new operations. Turning to slide 17, at the end of Q2, on a consolidated basis, we had $8.1 billion of total debt, $600 million of cash, and $800 million of availability under our revolving credit lines. We had gross leverage of 5.3 times and net leverage of 4.9 times, a modest increase from Q1. Leverage levels should trend down towards year-end as adjusted EBITDA expands.

Christopher Noyes: Q2 includes incremental bad debt of $12 million, driven by building and collection issues on our new systems, as well as the decision to not pursue collection on historic buildings for certain customers that experience migration issues. We expect bad debt to return to a more normalized level by the end of the year. We incurred approximately $9 million of TSA costs in Q2, which will drop off significantly in Q3 and will be negligible by the end of the year. And we incurred $3 million of integration op-ex in Q2, as well as inventory impacts associated with the migration of $4 million during the quarter.

Justin Oyvoda: We expect that debt to return to a more normalized level by the end of the year. We incurred approximately $9 million of TSA costs in Q2, which will drop off significantly in Q3 and will be negligible by the end of the year.

Justin Oyvoda: And we incurred $3 million of integration OPEX in Q2, as well as inventory impacts associated with the migration of $4 million during the quarter. These costs should largely drop off by year-end.

Christopher Noyes: These costs should largely drop off by year end. Finally, we expect to generate significant additional op-ex savings to H2 from the initiatives that started in Q2, and that will continue for the rest of the year. With all of this in mind, we are still targeting to reach $45 million in monthly adjusted wave of at some point in the back half of each. 2.

Christopher Noyes: Turning to slide 17, at the end of Q2 on a consolidated basis, we had $8.1 billion of total debt, $600 million of cash, and $800 million of availability under our revolving credit lines. We had gross leverage of 5.3 times, and that leverage of 4.9 times, and a modest increase from Q1. Leverage levels should trend down towards your end as adjusted way, but not expands.

Justin Oyvoda: Turning to slide 17, at the end of Q2 on a consolidated basis, we had $8.1 billion of total debt, $600 million of cash, and $800 million of availability under our revolving credit lines.

Justin Oyvoda: We had gross leverage of 5.3 times and net leverage of 4.9 times and modest increase from Q1. Leverage levels should trim down towards year-end as adjusted EBITDA expands.

Christopher Noyes: Q2 was an active quarter in terms of equity-related activities. We repurchased $22 million of stock, increasing our year-to-date total to $83 million. In addition to open market buybacks, we also entered into a derivative cap call arrangement. The highlight of this arrangement is that it provides us with a leveraged strategy to repurchase upwards of 6 million shares or 3% of LLA in H2 2025 at attractive prices. Managing risk is a critical component of our treasury function. We utilize weather derivatives triggered off of Cat 3 to Cat 5 wind speeds to provide us with recovery to the extent that we experience significant Nat Cat hurricane events.

Christopher Noyes: Q2 was an active quarter in terms of equity-related activities. We repurchased $22 million of stock, increasing our year-to-date total to $83 million, in addition to open market buybacks. We also entered into a derivative cap call arrangement. The highlight of this arrangement is that it provides us with a leverage strategy to repurchase upwards of $6 million shares or 3% of LLA in H2 2025 at attractive prices.

Justin Oyvoda: Q2 was an active quarter in terms of equity-related activities. We repurchased $22 million of stock, increasing our year-to-date total to $83 million. In addition to open market buybacks, we also entered into a derivative cap call arrangement.

Justin Oyvoda: The highlight of this arrangement is that it provides us with a leveraged strategy to repurchase upwards of 6 million shares or 3% of LLA in H2 2025 at attractive prices.

Christopher Noyes: Subsequent to quarter, we purchased and canceled the remaining $140 million about standing convertible notes due July 2024. As a result, substantially all of our debt is due in 2027 and beyond. Managing risk is a critical component of our treasury function. We utilize whether derivatives triggered off of cap 3 to cap 5 wind speeds to provide us with recovery to the extent that we experience significant net cat hurricane events. Payouts are defined in advance based on established values and wind speed, as well as the hurricane path. With respect to Hurricane Barrel, our parametric weather derivative program was triggered twice.

Justin Oyvoda: Subsequent to quarter end, we purchased and canceled the remaining $140 million of outstanding convertible notes due July 2024. As a result, substantially all of our debt is due in 2027 and beyond.

Speaker Change: Managing risk is a critical component of our Treasury function. We utilize weather derivatives triggered off of Cat 3 to Cat 5 wind speeds to provide us with recovery to the extent that we experience significant Nat Cat hurricane events.

Speaker Change: Payouts are defined in advance based on established values and wind speed, as well as the hurricane path.

Speaker Change: With respect to Hurricane Beryl, our parametric weather derivative program was triggered twice, and as a result, we expect to receive $44 million of net proceeds into LLA during Q3.

Christopher Noyes: And as a result, we expect to receive $44 million of net proceeds into LLA during Q3. We still have a sizable protection for CNW and Puerto Rico for the remaining storm season.

Balan Nair: To wrap up our prepared comments, we are making progress operationally, as seen today, but we still have work to do in Puerto Rico in order to return to BAU. LLA did grow revenue in just a little bit sequentially to Q1, but in Puerto Rico, we are probably three months behind of where we thought we would be at this time as delays and challenges in our operational systems hindered us. We have made good progress of LLA and are on track to see enhanced financial improvement in H2, especially Q4. Outside of Puerto Rico, our businesses in Panama, Costa Rica, and the Caribbean have performed very well both operationally and financially.

Christopher Noyes: To wrap up our prepared comments, we are making progress operationally, as seen today, but we still have work to do in Puerto Rico in order to return to BAU. In terms of capital allocation and M&A, we have been busy this year. Significant equity repurchases equating to 12 million shares or about 6% of LLA at what we think are really attractive levels and also entered into a derivative transaction for another 6 million shares.

Speaker Change: To wrap up our prepared comments, we are making progress operationally as seen today, but we still have work to do in Puerto Rico in order to return to BAU.

Speaker Change: Outside of Puerto Rico, our businesses in Panama, Costa Rica, and Caribbean have performed very well both operationally and financially.

Balan Nair: It call out to our Panamanian operation as the team capitalized on the exit by the third player, dramatically expanding its mobile subscriber base during the second quarter. We knew that 2024 was a tail of two halves, and then H2 would be the line share of our financial performance; that remains true to the state. We are focused on returning Puerto Rico to growth, driving fixed and mobile volumes across LLA, doubling down on cost takeouts across the group, and recovering from Hurricane Barrel. Within the Caribbean, Hurricane Barrel will impact our Q3 results, but it's temporary. In the last month, we have been quick to recover.

Speaker Change: that remains true to this day. We are focused on returning Puerto Rico to growth, driving fixed and mobile volumes across LA, doubling down on cost takeouts across the group and recovering from Hurricane Beryl.

Balan Nair: We anticipate the cash impact will be covered by the payout under our parametric program. And we are optimistic that we will come out stronger in the affected markets in terms of network quality and ultimately market share.

Speaker Change: In the last month, we have been quick to recover. We anticipate the cash impact will be covered by the payout under our parametric program. And we are optimistic that we'll come out stronger in the affected markets in terms of network quality and ultimately market share.

Balan Nair: In terms of capital allocation and MNA, we have been busy this year, significant equity repurchases equating to 12 million shares, or about 6% of LLA, and what we think are really attractive levels, and also entered into a driven transaction for another 6 million shares. In July, we also repaid the remaining amount due under our convertible bond.

Speaker Change: In terms of capital allocation and M&A, we have been busy this year. Significant equity repurchases equating to 12 million shares or about 6% of LLA at what we think are really attractive levels and also entered into a derivative transaction for another 6 million shares.

Balan Nair: With respect to MNA, we announced the acquisition of Tigo's fixed business in Costa Rica in July, and we are on the home stretch of closing on the Dish, Boost, Inspect and transaction for Puerto Rico. Both of these transactions should improve our ability to serve our customers and drive incremental growth and value.

Christopher Noyes: In July, we also repaid the remaining amount due under our convertible bond. With respect to M&A, we announced the acquisition of Tigo's Fixed Business in Costa Rica in July, and we are on the homestretch of closing on the DISH Boost Inspectum transaction for Puerto Rico. Both of these transactions should improve our ability to serve our customers and drive incremental growth and value. With that operator, please open it up for questions.

Unknown Executive: With that operator, please open it up for questions.

Unknown Executive: Thank you.

Unknown Executive: The question and answer session will be conducted electronically. If you would like to ask a question regarding the company's operations, please do so by pressing star one to ask a question or star zero for operator assistance.

Speaker Change: Thank you. The question and answer session will be conducted electronically. If you would like to ask a question regarding the company's operations, please do so by pressing star one to ask a question.

Operator: or Star Zero for operator issues. In order to accommodate everyone, we request that you ask only one question with one follow-up if needed. We'll pause for just a moment to give everyone an opportunity to signal for questions.

Unknown Executive: In order to accommodate everyone, we request that you ask only one question, with one follow-up if needed. If you are using a speaker phone, please make sure your mute function is turned off to allow your signal to reach our equipment. We'll pause for just a moment to give everyone an opportunity to signal for questions.

Speaker Change: We'll pause for just a moment to give everyone an opportunity to signal for questions.

Vitor Tomita: Our first question today is from the line of Iitor Tomita of Goldman Sachs. Please go ahead. Your line is now open. Hello, good morning all, and thank you very much for taking our questions. We have two from our side.

Speaker Change: Our first question today is from the line of Vitor Tomita of Goldman Sachs. Please go ahead, your line is now open.

Unknown Analyst: Hello, good morning, all, and thank you very much for taking our questions. We have two from our side.

Vitor Tomita: Hello, good morning all and thank you very much for taking our questions. We have two from our side. Both of them would be on Puerto Rico. The first one is if you could give us some more color on the retention discounts that you applied to ACP subscribers.

Vitor Tomita: The first of both of them would be on Puerto Rico. The first one is if you could give us some more color on the retention discounts that you applied to ACP subscribers. Mainly if those discounts affected revenues only starting in June, if they were applied to the entire ACP base or it was more of a percentage of it. And if you see risk of potential churn or bad debt issues going into Q3, particularly on non-discounted subscribers, if there are any.

Unknown Analyst: The first, both of them would be in Puerto Rico. The first one is if you could give us some more color on the retention discounts that you applied to ACP subscribers, mainly if those discounts affected revenues only starting in June, if they were applied to the entire ACP base or to a smaller percentage of it, and if you see risk of potential churn or bad debt issues going into Q3, particularly on non-discounted subscribers, if there are any.

Speaker Change: Mainly, if those discounts affected revenues only starting in June , if they were applied to the entire ACP base or a smaller percentage of it.

Speaker Change: And if you see risk of potential churn or bad debt issues going into Q3, particularly on non-discounted subscribers, if there are any.

Vitor Tomita: The second question from our side would be also in Puerto Rico. If you could go into a bit more detail on the drivers for the further EBDI improvement in Puerto Rico that you expect in the second half of the year. Basically, how much of that improvement will depend on cost cuts versus expected revenue improvement in there. Thank you very much.

Unknown Analyst: The second question from our side would be on Puerto Rico. If you could go into a bit more detail on the drivers for the further EBITDA improvement in Puerto Rico that you expect in the second half of the year. Basically, how much of that improvement will depend on cost cuts versus expected revenue improvement there?

Speaker Change: The second question from our side would be, also in Puerto Rico, if you could go into a bit more detail on the drivers for the further EBITDA improvement in Puerto Rico that you expect in the second half of the year. Basically, how much of that improvement will depend on cost cuts?

Unknown Executive: Thank you very much.

Balan Nair: Good morning, and thank you for your question. I'll ask Eduardo to also jump in here on the ACP. We have roughly about 85,000 subscribers in fix and about 3,000 mobile, so very low exposure mobile. On the fix, we've been able to retain the bulk of it, more than 97%. I think the effective discount, and Eduardo can jump in here. I think what's about $14 with the effective discount that we provided.

Speaker Change: I think the effective discount, and Eduardo you can jump in here, I think it was about $14 was the effective discount that we provided. Let me put it a different way. The subsidy was about $30 and our effective subsidy was about $14.

Eduardo Corona: Let me put it differently. The subsidy was about 30 bucks, and our effective subsidy was about 14 bucks. So you're close to 14, 15 bucks, 15 bucks on the effective discount, but we've been able to retain the bulk of our customers on ACP. Now there's another group of customers in this particularly hit mobile in another program called ETF where we actually have kind of like a little dongle for our customers. It's a very low R2 on that, and that was what really impacted our operating numbers with that disconnect on the ETF side, and you see that manifests itself in the post paid numbers.

Unknown Executive: Close to 14, 15 bucks, 15 bucks on the defective discount, but we've been able to retain the bulk of our customers. We actually have, on a monthly basis or as a bidder, a whole bunch of drivers around that, specifically, of course, the TSA dropouts, a whole bunch of one-off cards that don't recur again. And then there are a couple of additional drivers of... of recovery here, one of them is cost takeout. And as you probably, you know, I don't know if you recall, we said that we were taking out about 300 headcount in Puerto Rico, which we've effectively completed.

Speaker Change: So you're close to $14, $15, $15 on the effective discount, but we've been able to retain the bulk of our customers.

Balan Nair: On the EBITDA side, we're actually quite bullish on our outlook when we get it to the 45 million towards the end of the year on a monthly basis or EBITDA. There's a number of drivers around that, specifically, of course, the PSE dropout. We have a whole bunch of one-off costs that don't recur again. And then it's, you know, a couple of additional drivers of recovery here. One of it is cost account. And as you, as we probably, you know, I don't know if you recall, we said that we were taking out about 300 headcount in Puerto Rico, which we've effectively completed.

Speaker Change: Quite bullish on our outlook when we got it to the $45 million towards the end of the year on a monthly basis, oy bida.

Eduardo: there's a number of drivers around that, specifically, of course, the TSA dropouts.

Eduardo: We have a whole bunch of one-off cars that don't recur again. And then it's, you know, a couple of additional drivers of...

Eduardo: And as you, as we probably, you know, I don't know if you recall, we said that we were taking out about 300 headcounts in Puerto Rico, which we've effectively completed.

Balan Nair: And in addition to that, there's a number of line items that we've been looking at both on the cost of goods sold and the actual effects line that we feel that we are very well on our way to take those costs out. So those would add into our monthly orbit up.

Unknown Executive: And in addition to that, there's a number of line items that we've been looking at both on the cost of goods sold Andres Ituarte, Vitor Tomita, Gabriel Lima, Daniel Neiva, Rocio Lorenzo, Liberty Global, And finally, we will be launching our new campaigns, launch, it's going to drive additional gross ads, it will have a slight impact on our opex because customer acquisition, will drive revenue and top line and bottom line as well into the fourth quarter, which is kind of why we've kind of pushed 45 million to it at the end of the year, because they have some slight additional costs in customer acquisition as well. But that's how the ladder builds back into the 45 million.

Eduardo: and the actual OPEX line that we feel that we are very well on our way to take those costs out. So those would add into our monthly OEBITDA. And then finally, we will be launching our new campaigns.

Balan Nair: And then finally, we will be launching our new campaigns. And after the campaign launch, it's going to drive additional gross ads. It will have a slight impact on our effects because customer acquisition, but it will drive revenue and top line and bottom line as well into the fourth quarter, which is kind of why we've kind of pushed 45 million to the end of the year because they have some slight additional cost in customer acquisition as well. But that's how the ladder builds back into the 45 million.

Eduardo: but it will drive revenue and top line and bottom line as well into the fourth quarter.

Eduardo Corona: Eduardo, you want to give a little bit more color on the ACP. And maybe if you have, if you want to share a little bit of. Of course, of course, thank you.

Eduardo: Eduardo, you want to give a little bit more color on the ACP and maybe if you have, if you want to share some thoughts a little bit?

Eduardo Corona: Good morning. Thank you for your question. You know, we believe that the results on ACP at the end of the program were quite successful. We were able to retain over 92% of the base. And when we think about the impact overall of that base, the ARPA reduction overall is only about 4%. There are some discounts that we did mostly on retention, as Vannon mentioned, on some customers that were probably in more, more, let me call it dire circumstances to continue with the service. But in general, the impact on the ARPA was also coming from customers downgrading their plans, given the fact that the subsidy finished.

Unknown Executive: And when we think about the impact overall of that base, the ARPU reduction overall is only about 4%. There are some discounts that we did mostly for retention, as Balan mentioned, on some customers that were probably in more, let me call it dire circumstances, to continue with the service. But in general, the impact on the ARPU is also coming from customers downgrading their plans given the fact that the subsidy has finished. And so you have both combinations, if you will, some retention offers with discounts and customers downgrading their services to be able to meet their budget needs. But overall, I would say very successful. And in the case of mobile, a very small number, and we were able to retain most of those customers as well. So that would be on ACP.

Eduardo: And when we think about the impact overall of that base, the ARPA reduction overall is only about 4%.

Eduardo Corona: And so you have both combinations: if you will, some retention offers with discounts and customers downgrading their services to be able to meet their budget needs.

Eduardo Corona: But all overall, I would say very successful. And in the case of mobile, the very small number. And we were able to retain most of those customers as well.

Eduardo: And in the case of mobile, a very small number, and we were able to retain most of those customers as well.

Eduardo Corona: So, so that would be on ACP in terms of the time improvements. I mean, certainly we're looking to to to to extract all the opportunities that the integration of both our mobile operations and fixed operations can give us to become really a convergent company. And the teams are working extremely hard. I think that that in terms of sales, the last couple months have shown very, very good traction, not necessarily where we wanted to go. But I think that that that that we're starting to see the improvements now that we control our systems and therefore are able to build our offers and certainly leverage our base, both on the fixed and mobile sides to create cross sending options.

Unknown Executive: In terms of in-depth improvements, I mean, certainly, we're looking to extract all the opportunities that the integration of both our mobile operations and fixed operations can give us to become really a convergent company. I hope that gives you a better understanding. Thank you, Eduardo.

Speaker Change: Not necessarily where we wanted to go, but I think that we're starting to see

Unknown Executive: Thank you.

Unknown Executive: I hope that gives you a better color. Thank you, Eduardo. That's very good. Thank you.

Unknown Executive: Thank you, Eduardo. That's very good. Thank you. Thank you very much.

Unknown Executive: Thank you very much.

Michael Rollins: How next question today is from the line of Michael Rollins of Citigroup. Please go ahead. Your line is now open. Thanks and good morning. Just following up on Puerto Rico.

Speaker Change: Our next question today is from the line of Michael Rollins of Citigroup. Please go ahead, your line is now open.

Michael Rollins: So if you take the expectation to get to a monthly run rate of $45 million, does that put the 2025 EBITDA contribution for Puerto Rico at roughly $540 million? And if not, what would be the variances? Thanks. Sure. Well, you know, I want to straight-line the number. Here's how I'd look at it: you know, in the big part of our business is always about opening balances and opening balances, the monthly level at the quarterly level. And certainly, as we build our 25 budget, it would be the opening balance in December, going into January. Our goal is to get to the 45 million by the end of this year in the last couple of months.

Michael Rollins: Thanks and good morning. Just following up on Puerto Rico. So if you take the

Unknown Executive: to get to a monthly run rate.

Speaker Change: Expectation to get to a monthly run rate.

Michael Rollins: of 45 million. Does that put the 2025 EBITDA contribution for Puerto Rico at roughly 540 million? And if not, what would be the variances?

Michael Rollins: Thanks.

Unknown Executive: Sure. But, you know, I wouldn't straight line the number. Here's how I'd look at it, you know, and the big part of our business is always about opening balances and opening balances at the monthly level, at the quarterly level. And certainly, if we built a $25 budget, it would be the opening balance in December going into January. Our goal is to get to 45 million by the end of this year. In the last couple of months,

Speaker Change: Well, you know, I wouldn't straight line the number, here's how I'd look at it, you know, and a big part of our business is always about opening balances, and it's opening balances at the monthly level, at the quarterly level, and certainly if we build our 25 budget, it would be the opening balance in December going into January .

Speaker Change: Our goal is to get to the 45 million by the end of this year, in the last couple of months. And then we'll have, going into 2025, an opening balance of both subscribers and fixed and postpaid, as well as where our B2B trajectory. I expect...

Balan Nair: And then we'll have going into 25 and opening balance of both subscribers and fixed and post paid as well as where our B2B trajectory. I expect that to not be 45 every month for the year 25. So you'll start seeing growth coming in. And as the year progresses, since we add net ads, the first quarter net ads will certainly drive the second, third, and fourth quarter. And then the second quarter net ads, third and fourth. So I suspect by the end of '25, just shoot me if we're still at 45 million. It's going to be a better number.

Unknown Executive: And then we'll have, going into 2025, an opening balance of both subscribers and fixed and postpaid, as well as a rare B2B trajectory. I expect that it will not be 45 every month for the year. So you'll start seeing growth coming in, and as the year progresses and as we add net ads, the first quarter net ads will certainly drive the second, third, and fourth quarter, and then the second quarter net ads will drive the third and fourth. So I suspect by the end of 25, just shoot me if we're still at 45 million. It's going to be a better night. So, and then you can just figure it out.

Balan Nair: So, and then you can just figure out, you know, I want to model the baby there for 25.

Unknown Executive: You want to model the data for 25.

Speaker Change: How do you want to model the EBITDA for 2025?

Balan Nair: And as you look at the broader portfolio, this 2025 mark the year where you expect rebased revenue growth for the entirety of the portfolio. To be positive for the year, or are there still just significant variability between markets and products where it's just harder to assess when you get to that sustainable rebased revenue growth level. Thanks. Okay. There will be revenue growth positive in 25. That's a given. And let me explain why I feel so confident of it. I'll stab it up. You know, we have essentially five segments here. Our cable and wireless Caribbean business, we spent a lot of years rebuilding that platform, building not only a great team supporting that platform, but also an infrastructure and a product base.

Unknown Executive: And as you look at the broader portfolio, there's 2025.

Speaker Change: And as you look at the broader portfolio, there's 20, 25.

Unknown Executive: the year where you'd expect revenue growth for the entirety of the portfolio to be positive for the year, or is there still just significant variability between markets and products where it's just harder to assess when you get to that sustainable revenue growth level? Thanks.

Speaker Change: Mark the year where you would expect

Speaker Change: significant variability between markets and products where

Unknown Executive: There will be revenue growth positive in 25. That's a given. And let me explain why I feel so confident.

Speaker Change: level. Thanks.

Unknown Executive: Caribbean Business. We've spent a lot of years rebuilding that platform, building not only a great team supporting that platform, but also an infrastructure and a product base. So for the most part, any headwinds there are on copper.

Speaker Change: Caribbean business. We've spent a lot of years rebuilding that platform, building not only a great team supporting that platform, but also an infrastructure and a product base. So for the most part

Balan Nair: So for the most part, we've eliminated most of all a twisted pair of copper by 25. It actually by the first second quarter, 25. There'll be no more copper, but we are no longer relying on that. So you don't have any headwinds there on copper. It's a droplet market. and we continue to grow both aspects post-paid mobile as well. And we think for sure, between all of the competitors in that market, wherever we are facing, I think for sure that that's going to be drivers for price increases in our products next year. So you've got a great network, great products, and very high probability of price increases.

Speaker Change: eliminated most all a twisted pair of copper by 25 actually by the first second quarter 25 there will be no more copper but we no longer relying on that

Unknown Executive: It's a wobbly market, and we continue to grow both on fixed and post-paid mobile as well. And we think, for sure, products next year. So you've got a great network, a great product. Then you move to Panama.

Speaker Change: And we continue to grow both on fixed and post-paid mobile as well.

Speaker Change: of the competitors in that market, whoever we are facing, I think, for sure, that's going to be

Speaker Change: Drivers for price increases

Speaker Change: in our products next year. So you've got a great network, great products.

Balan Nair: Then you move to our Panama business, we've also rebuilt that business quite quite a bit and you see the tremendous growth this year and with our management team and our new management team in Panama, very focused, not only in the top line growth, but the efficiency of the business. You'll see top line growth and expansion in the OSCF margin in that business. And that's clear state, we are investing in the network; almost all of it's now fiber and very new HFC. We are 5G in that network. It's one of our best mobile networks as well.

Speaker Change: and very high probabilities of price increases.

Speaker Change: Then you move to our Panama business.

Speaker Change: We've also rebuilt that business quite a bit, and you see the tremendous growth this year. And with our management team and our new management team in Panama, very focused not only on the top-line growth, but the efficiency of the business.

Unknown Executive: And that's Clear Estate. We are investing in the network, almost all of it now, fiber and the very new HFC. Then you look at Costa Rica with our current trend, you know, the deal that we just announced, we're going to bring market consolidation, but even pre-market consolidation, we are investing in our mobile networks and our fixed networks. We are building fiber rapidly there, and our HSE network there is very strong.

Speaker Change: And that's Clear State. We are investing in the network, almost all of it now, fiber and very new HFC. We have 5G in that network.

Balan Nair: And clearly, we will be back in the front driver seat. We are already the leader in mobile, and we are doing a very good job as an attacker on the fixed side. And our general manager there, together with the team, has been really focused not only on the top line, but as well on the operations and the platform. Then you look at Costa Rica without current. You know, the deal that we just announced is going to bring market consolidation, but even pre-market consolidation, we are investing also invested in our mobile networks and fixed networks. We are building fiber rapidly that.

Speaker Change: It's one of our best mobile networks as well, and clearly, we will be back in the front driver's seat. We are already the leader in mobile, and we're doing a very good job as an attacker on the fixed side.

Speaker Change: And our general manager there, together with the team, has been really focused not only on the top line, but as well on the operations and the platform.

Speaker Change: Then you look at Costa Rica with our current trend, you know, the deal that we just announced is going to bring market consolidation, but even pre-market consolidation, we are investing, also have invested in our mobile networks and our fixed networks. We are building fiber rapidly there.

Balan Nair: And in our HFC network day, it's very strong. So you'll see us doing really well; we are already today doing well in mobile and fixed, and our general manager there and the leadership team are also focused on the platform. Then you look at our Liberty Networks, our subsea business. Our subsea business has been going through a number of changes, and our general manager then, together with the new leadership team, has been very focused on getting more from it NRR and non-recurring revenue model to an MRR monthly recurring revenue model. So you're seeing the subscription model grow, and what you see in your numbers is to be reported in the second quarter. It's just some of the washing out of some of the old IRUs, where we've collected the cash.

Speaker Change: And our HSE network there is very strong.

Unknown Executive: Subsea business is going through a number of changes, and our general manager, Dan, together with the new leadership team, has been very focused on getting more from an NRR, a non-recurring revenue model, to an MRR, a monthly recurring revenue model. So you're seeing the subscription model grow. And what you see in your numbers, as we reported in the second quarter, is just some of the washing out of some of the old IRUs where we've collected the cash. It's just an accounting treatment on both revenue and OCF. It always gets reversed back at the working capital level.

Speaker Change: Then you look at Liberty Network's subsea business. Our subsea business...

Speaker Change: has

Speaker Change: been going through a number of changes. And our general manager then, together with the new leadership team, has been very focused on getting us more from an NRR, a non-recurring revenue model, to an MRR, a monthly recurring revenue model. So you're seeing the subscription model grow. And what you see in your numbers as we report in the second quarter is just some of the

Balan Nair: It's just an accounting treatment on both revenue and OCF. It always gets reversed back at the working capital level. So we have been cleaning that up, and you'll see the year-over-year starting next year to be not dependent on IRUs, and it's mostly going to be driven on monthly recurring revenue real growth. And as we reported today, the enterprise business double-digit growth and that's all and mostly all MRRs. And our subsea network has been announced the last time as well. We're building new routes, and we're really excited about that platform. So now I've covered you four platforms that we are really bullish on.

Unknown Executive: So we have been cleaning that up, and you'll see the year-over-year starting next year. And like the other companies, we are dependent on IRUs, and it's mostly going to be driven by monthly recurring revenue, real growth. And as we reported today, the enterprise business, double-digit growth. And that's mostly all MRR.

Speaker Change: And as we reported today, the enterprise business, double-digit growth, and that's mostly all MRRs.

Balan Nair: And then let's go back to Puerto Rico. Puerto Rico 2024, the first half is all about doing the migrations and cleaning up the after effect of migrations. The third quarter and the fourth quarter, third quarter is all about rebuilding the story, relaunching the brand, getting our new propositions on our new network and our new IT systems. And then you start harvesting the beginnings of it in the fourth quarter. And then in 2025, you're off to the rate system. We're going to put up some big numbers in Puerto Rico. Of course, year over year, it's going to be big numbers given the challenges this year.

Unknown Executive: And our subsea network, as we announced the last time as well, we're building new routes. We're really excited about Puerto Rico 2024, the first half is all about doing the migrations and cleaning up the aftereffects of migration. The third quarter and the fourth quarter are all about rebuilding the story, relaunching the brand, getting our new propositions on our new network and our new IT system. And then in 2025, you're off to the races there.

Speaker Change: And then you start harvesting the beginnings of it in the fourth quarter. And then in 2025, you're off to the races then. We're going to put up some big numbers in Puerto Rico, of course, year over year, it's going to be big numbers given the challenges this year.

Unknown Executive: We're going to put up some big numbers in Puerto Rico. Of course, year over year, it's going to be big numbers given the challenges this year, and also going to be good numbers in 2025. We've got a great management team there who are really committed. So in all of our markets, we've invested in the networks, in the systems, and in the people. And I think we've got a great platform, and if it weren't for the migration that we were doing this year in Puerto Rico, you can clearly see that we would have put up double-digit growth this year.

Balan Nair: But it's also going to be good numbers in 2025. It's got a great management team there. It's really committed. So, in all of our markets, we've invested in the networks, in the systems, and in the people. And I think we've got a great platform. And if it weren't for the migration that we were doing this year in Puerto Rico, you can clearly see we'll be putting up double-digit growth this year. I mean, this is, this is a great platform. So all we are seeing right now is just a bump. In the first half of the year, and then third quarter's rebuilding, and then fourth quarter selling.

Speaker Change: But it's also going to be good numbers in 2025. We've got a great management team there.

Speaker Change: And it's really committed. So, in all of our markets, we've invested in the networks, in the systems,

Speaker Change: and In The People.

Unknown Executive: I mean, this is a great platform. So all we are seeing right now is just a bump in the first half of the year, and the third quarter is rebuilding, and then fourth quarter selling. And then you build into that momentum. Hopefully, that was helpful, Michael.

Unknown Executive: And then you build into that momentum into 2025. Hopefully, that was helpful, Michael. Thank you.

Speaker Change: Hopefully that was helpful, Michael.

Matthew Harrigan: How next question today is from the line of Matthew Harrigan of Benchmark Company. Please go ahead. Now your line is open. Thank you. It's going to go to Puerto Rico 540 question as well. But beyond that, the fair amount of level 4 data center activity, I think particularly in here now and some high for sale are being pretty active and particularly clear to me and I think more than some whole America. If you're a tailwind there, you know, if you're a network business off that. And then secondly, very broadly, clearly, you don't have any direct exposure to Venezuela.

Operator: Our next question today is from the line of Matthew Harrigan of Benchmark Company. Please go ahead now. Your line is open.

Michael Rollins: Thank you.

Matthew Harrigan: Thank you. I was going to go up to the Puerto Rico 540 question as well, but beyond that... A fair amount of, you know, level four data center activity, I think, particularly in Curacao, and some hyperscalers being pretty active, in particular in the Caribbean, I think more so than Central America. Is there a tailwind there, you know, for your network business from that? And then secondly, very broadly, clearly, you don't have any direct exposure to Venezuela, but is there anything on the political or regulatory side that could be positive or create opportunities across your markets? And they're fairly open-ended. Thanks and congratulations on the results.

Michael Rollins: Thank you. It's going to go up to Puerto Rico 540 question as well. But beyond that...

Speaker Change: A fair amount of level four data center activity, I think, particularly in Curaçao and some hyperscalers being pretty

Speaker Change: Is there a tailwind there, you know, from your network business off that? And then secondly, very broadly, clearly you don't have any direct exposure to Venezuela, but is there anything on the political or regulatory side that gives you pause or creates...

Matthew Harrigan: But is there anything on the political regulatory side that deposits are great opportunities across your markets? And they're certainly open-ended. Thanks. And congratulations from the results.

Balan Nair: Thank you, Matt.

Balan Nair: Thank you, Matt. And I'll ask Ray Collins to also jump in here a bit on the data center array. On the data center business, you know, we have a number of data centers. Actually, we do have a data center in Curacao, which we support both internally and external customers as well. It's a great island.

Balan Nair: And I'll ask Ray Collins to also jump in here in a bit under Data Center. On the data center business, you know, we have a number of data centers. Actually, we do have a data center in Curacao, which we support for internally and external customers as well. It's a great island. It's it's an island that's really rarely, very, very rarely and I touch with you impacted by hurricane. It's a great location for us to build our data center. And we've been building also micro data centers for specific customers in the number of markets. But I think, you know, as we look at the data center business, the three areas that could be real good opportunities for us are Panama, Costa Rica, and Mexico.

Ray Collins: Thank you, Matt. And I'll ask Ray Collins to also jump in here in a bit on the data center array.

Balan Nair: It's, it's, it's an island that's really, Rarely, very, very rarely, and I touch wood here, impacted by hurricanes, a good location for us to build our data center. And we've been building also micro data centers for specific customers in a number of markets. Think, you know, as we look at the data center business, the three areas that are really good opportunities for us are Panama. And Mexico, as you know, we are building fiber going into the Cancun area and Quintero in Mexico, where we, the data center business, have been growing.

Ray Collins: On the data center business, you know, we have a number of data centers. Actually, we do have a data center in Curaçao, which we support both internally and external customers as well. It's a great island. It's an island that's really unique. It's a great island. It's an island that's really unique. It's a great island.

Ray Collins: Rarely, very, very rarely, and I touch wood here, impacted by hurricanes.

Ray Collins: great location for us to build our data center. And we've been building also micro data centers for specific customers in a number of markets.

Ray Collins: be real good opportunities for us is Panama.

Balan Nair: As you know, we're building fiber going into Cancun area and Quintero, in Mexico, where the data center business has been growing. So we are building connectivity into that. And then, of course, you look at Panama and Costa Rica. They're both countries where the Chips Act has a flow of money, and you can see Intel building plans in Costa Rica. So we are also focused very for hyper focus on that. And so on, the data center business, it's kind of how we're looking at, but you really have to have the contracts with the large hyperscalers. It to really for you to really allocate significant amount of capital in the space.

Balan Nair: So we are building connectivity into that. Of course, you look at Panama and Costa Rica. They're both countries where the CHIPS Act has brought in money, and you can see Intel building plants in Costa Rica. So we are also focused, very hyper-focused on that. And so on the data center business, that's kind of how we're looking at it, but you really have to have the contracts with the large hyperscalers for it to really, for you to really allocate a significant amount of capital.

Ray Collins: And then, of course, you look at Panama and Costa Rica. They're both countries where the CHIPS Act has flown money. And you can see Intel building plants in Costa Rica. So we are also focused, very hyper-focused on that.

Ray Collins: And so on the data center business, that's kind of how we're looking at, but you really have to have the contracts with the large hyperscalers for you to really allocate significant amount of capital in this space.

Balan Nair: And then on Venezuela, we follow every political change and challenge in our region. And we'll see how that plays out. And we have absolutely no plans right now to go into Venezuela, even though we have a good business in Venezuela without subsidy. We have a really good customer said they pay us. and US dollars, and we are very appreciative of that. And we like those businesses. If the world changes in the future, of course, Venezuela would be a great market at some point in the future when their political turmoil changes.

Balan Nair: And then on Venezuela, we follow every political change and challenge in our region, and we'll see how that plays out. And we have absolutely no plans right now to go into Venezuela, even though we have a good business in Venezuela with our subsea pipeline. We have really good customers there, they pay us in U.S. dollars, and we are very appreciative of that.

Balan Nair: And we like we like those businesses. If the world changes in the future, of course, Venezuela would be a great market at some point in the future when their political turmoil changes. The other market, of course, is Argentina as well. Once the political turmoil changes there, it could be a really good market. These are all dislocated markets. And clearly, Ray Collins from our M&A team, and Chris Noyes.

Speaker Change: and U.S. Dollars and we are very appreciative of that.

Balan Nair: The other market, of course, is Argentina as well. When the time is right, we'll be very opportunistic, but right now I don't see it.

Balan Nair: John Winter and myself, we look closely at all these markets, and when the time is right, we'll be very opportunistic, but right now, I don't see it. Um, are you ready? Yeah, just.

Ray Collins: You ready? Yeah, just to add on the data center business, thanks, Balan. We also provide data center to data center connectivity in our B2B business and in our networks business. And actually one of the drivers of the new system, which we announced, is really connecting some of the hyperscale data centers that we see, the build that you see in Corretero in Mexico, where we're connecting from Veracruz back up to a new connectivity that will put into the Appalachia coast of Florida, connecting into Virginia and Georgia and then down to Columbia. So the new network that we've announced is really all about serving about hyperscale data center traffic.

Ray Collins: Yeah, just to add on the data center business. Thanks, Balan.

Ray Collins: And we also provide data center to data center connectivity in our B2B business and in our networks business. And actually, one of the drivers of the new system, which we announced, is really connecting some of the hyperscale data centers that we see, the build that you see in Queretaro, Mexico, where we're connecting from Veracruz back up to a new connectivity that we'll put on the Apalachee Coast of Florida, connecting into Virginia and Georgia, and then down to Colombia.

Speaker Change: The build that you see in Queretaro in Mexico, where we're connecting from Veracruz,

Ray Collins: So the new network that we've announced is really all about serving that hyperscale data center traffic. As Balan said, we don't have current plans to build data center cells for hyperscalers, but we have, you know, we see a strong tailwind from enabling and connecting the various deployments that we see.

Ray Collins: As Balan said, we don't have current plans to build data center cells for hyperscalers, but we have, you know, we see a strong tailwind from enabling and connecting the various deployments that we see in the region. Thank you, Ray.

Speaker Change: data center traffic. As Balan said, we don't have current plans to build data center cells for hyperscalers. But we have, you know, we see a strong tailwind from enabling and connecting the various deployments that we see in the region.

Operator: Thank you, Ray. Thank you. And our next question today is from the line of Gabriel Vaz de Lima of Morgan Stanley.

Speaker Change: Thank you, Ray.

Gabriel Baselina: Thank you, and our next question today is from the line of Gabriel Vasilema of Morgan Stanley. Please go ahead. Your line is open. Thank you very much.

Operator: Thank you. And our next question today is from the line of Gabriel Vaz de Lima of Morgan Stanley. Please go ahead. Your line is open. Thank you very much.

Speaker Change: Thank you and our next question today is from the line of Gabriel Vaz de Lima of Morgan Stanley . Please go ahead, your line is open.

Gabriel Baselina: Just wanted to get a bit more color on the possible regions infected. They have heard confused in this. This time around, like any kind of color you can provide to us in terms of what kind of impact we should expect and how this could expect to impact your businesses in Jamaica and the regions that were already impacted. Okay, well, the hurricane, you know, barrel that went through has impacted three of our operations: Grenada, St. Vincent and Jamaica. And in many cases, the biggest driver for challenges has been our outages. Primarily, you know, if you look especially in Jamaica, where our customers went offline, not because the network went down, but because of power. You know, we have a significant amount of towers in Jamaica, which only like seven towers got damaged.

Speaker Change: and possible regions infected by the hurricane season.

Balan Nair: Okay, well, the hurricane barrel that went through us impacted three of our operations, Grenada, St. Vincent, and Jamaica. And in many cases, the biggest driver of our challenges has been power outages. Specifically, you know, if you look, especially in Jamaica, customers went offline, not because the network went down, but because of power.

Balan Nair: You know, we have a significant number of towers in Jamaica; only about seven towers got damaged. And by the way, we did a deal with, if you recall from the last quarter with PTI, and PTI is responsible for rebuilding those. And so, from a mobile tower standpoint, we're good. From a fixed network standpoint, for the most part, our network withstood it.

Speaker Change: Okay, well the hurricane, you know, barrel that went through us impacted three of our operations, Grenada, St. Vincent, and Jamaica.

Speaker Change: where our customers went offline, not because the network went down, but because of power. You know, we have significant amount of towers in Jamaica.

Balan Nair: And by the way, we did the deal with, if you recall from the last quarter, with PTI, and PTI is responsible for rebuilding those towers. And so, you know, from a mobile tower standpoint, we good. From a fixed network standpoint, for the most part of network, which stood it, we have some network that we have to rebuild. And we're going to rebuild our backbone. It's about 170 kilometers of our backbone. We're going to underground the whole backbone, and that's built into our budget as well. Now, in one or two smaller islands, Carcoup Union Islands of St.

Speaker Change: which only like seven towers got damaged. And by the way, we did a deal with, if you recall from the last quarter with PTI, and PTI is responsible for rebuilding those towers.

Balan Nair: We have some networks that we have to rebuild, and we're going to rebuild our backbone. It's about 170 kilometers of our backbone. We're going to underground the whole backbone. And that's built into our budget as well. Now, on one or two smaller islands, Karuku, the Union Islands of St. Vincent and Grenada, it was damaged significantly. And we've gone back in there, rebuilt the mobile, and on the fixed side, we are using an alternative technology with fixed wireless access to get customers back, and as well, cost-efficiently.

Balan Nair: Vincent and Grenada, that it was damaged significantly. And we've gone back in there, rebuilt the mobile. And on the fixed side, we are using an alternative technology with fixed wireless access to get customers backup quickly and as well, cost efficiently. When you look at this year's hurricane season, we got hit pretty early, but the team was resilient. We've rebuilt what we needed to rebuild. Some of the cost impacts that Chris alluded to was really around some credits that we will be giving back to our customers because they didn't have our network service, and we'll give them some credits back because they didn't have the service.

Speaker Change: And we've gone back in there, rebuilt the mobile, and on the FIX side, we are using an alternative technology with FIX wireless access to get customers back up.

Balan Nair: So, you know... When you look at this year's hurricane season, we got hit pretty early, but we're resilient. We've rebuilt what we needed to rebuild some of the cost impact that Chris alluded to, around some credits that we will be giving back to our customers because they didn't have power and didn't have our network service. And we'll give them some credits back if they didn't have to serve.

Speaker Change: Quickly, and as well, cost-efficiently. So, you know...

Speaker Change: was really around some credits that we will be giving back our customers because they didn't have power and didn't have our network service and we'll give them some credits back if they didn't have the service.

Balan Nair: All in all, we feel really good. And by the way, our team did a tremendous job on the insurance; this parametric insurance clearly delivered. And as Chris pointed out, we've closed out with our brokers and the insurance consortium. And we will be paid for the damage. And it should relatively have very little financial impact to us with this, historically.

Speaker Change: All in all, we feel really good. And by the way, our team did a tremendous job on the insurance, this parametric insurance.

Speaker Change: Clearly...

Unknown Executive: Thank you, and this will conclude today's question-and-answer session.

Balan Nair: I'd like to hand back to Balan Nair for any additional or closing remarks. Thank you, operator. And thank you, everybody, for joining us this morning. To concede, you know, our business is moving and we've got momentum behind us in all of our businesses. And I would say the same in Puerto Rico.

Speaker Change: Thank you and this will conclude today's question and answer session. I'd like to hand back to Balan Nair for any additional or closing remarks.

Unknown Executive: All closing remarks.

Balan Nair: Thank you, operator. And thank you, everybody, for joining us this morning, all of our businesses. And I would say the same in Puerto Rico. And I hope to share with you in the third quarter some more positive data out of Puerto Rico. As Eduardo pointed out, and Chris pointed out, we're already seeing green shoots.

Balan Nair: Thank you, operator. And thank you, everybody, for joining us this morning. As you can see, you know, our business is moving, and we've got momentum behind us.

Balan Nair: And I hope to share with you in the third quarter to more positive data out of Puerto Rico. As Eduardo pointed out and Chris pointed out, we've seen green shoots already; a pre-paid business is growing there. And that was the first group of customers we migrated, and already, you know, a lot of the systems, et cetera, it started to get better. And as we look at even at our customer sentiment, for all the new customers, we've added on the what we call NPS and that promoter's course of our customers been extremely positive. It's actually one of the best in our whole company.

Balan Nair: in all of our businesses, and I would say the same in Puerto Rico, and I hope to share with you in the third quarter some more positives.

Balan Nair: Data out of Puerto Rico. As Eduardo pointed out, and Chris pointed out, we're seeing green shoots already.

Balan Nair: Prepaid business is growing there, and that was the first group of customers we migrated. And already, you know, a lot of the systems, etc., have started to get better. And as we look even at our customer sentiment, for all the new customers we've added, the what we call NPS, Net Promoter Score of our customers has been extremely positive. It's actually one of the best in our whole company. And then for our existing customers, it's in two buckets; the ones that we migrated successfully and cleanly, and that's 80% of our customers; they are feeling good. The 20% of customers that we had challenges with billing, of course, we need to rectify that, and we will.

Speaker Change: A prepaid business is growing there and that was the first group of customers we migrated and

Balan Nair: And then for existing customers, it's in two buckets that want to be migrated successfully. And that's 80% of our customers. They are feeling good. The 20% of customers that we had challenges in billing; of course, we need to rectify that, and we will. And you'll see some of that results in the third and fourth quarter this year.

Balan Nair: I mean, very bullish about our business, and thank you so much for your support.

Speaker Change: I remain very bullish about our business and I thank you so much for your support.

Unknown Executive: Ladies and gentlemen, this concludes Liberty Latin America's second quarter 2024 Investical. As a reminder, a replay of the call will be available in the Investor Relations section of Liberty Latin America's website at www.lla.com. There, you can also find a copy of today's presentation materials.

Speaker Change: There you can also find a copy of today's presentation materials.

Speaker Change: Unknown Executive, Balan Nair, Christopher Noyes Unknown Executive, Balan Nair, Christopher Noyes

Speaker Change: Unknown Executive, Balan Nair, Christopher Noyes Unknown Executive, Balan Nair, Christopher Noyes