Release Date: February 27, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Could you please be more explicit on which markets and segments should see the main improvement as per your expectations for 2025? Also, what will be the cost of these reacceleration efforts in terms of OpEx and CapEx? A: Our mobile business, which is more than 50% of our revenues, is growing nicely, with a 4.6% year-over-year increase. We expect this trend to continue in 2025, driven by postpaid and prepaid growth. We also anticipate our home segment to recover and B2B to maintain a growth rate of around 3%. We believe we can sustain the same level of CapEx by focusing investments where demand is highest, thus not expecting pressure on margins. Challenges may arise in Costa Rica and Bolivia due to aggressive competition and currency devaluation, respectively. - Marcelo Benitez, CEO
Q: Could you comment on the difference between cash CapEx and booked CapEx in 2024 and how this will develop in 2025? Also, what are the risks of adverse legal rulings mentioned in your cash flow guidance? A: CapEx booked decreased from $809 million in 2023 to $677 million in 2024, and we expect it to stabilize around this number in 2025. Cash CapEx was lower due to timing differences in payments, and we expect these numbers to converge over time. Regarding legal risks, we have a provision for a negative ruling in Costa Rica, and there are ongoing legal disputes across countries that could impact cash flow. - Bart Vanhaeren, CFO
Q: Regarding your pricing power in Guatemala, Colombia, and Panama, is growth driven more by volume or pricing? Also, why did you choose to reinstate dividends over further debt reduction? A: Growth is driven by increasing data demand, which we monetize by increasing allowances and ticket prices, a strategy applicable across all markets except Costa Rica. On dividends, we generate about $750 million in equity free cash flow and decided to distribute $500 million to shareholders while keeping the rest for deleveraging or strategic projects. We expect to end the year significantly below our 2.5x leverage target. - Marcelo Benitez, CEO and Bart Vanhaeren, CFO
Q: What are the main assumptions embedded in your 2025 guidance, and what are the potential upside and downside risks? A: Our $750 million equity free cash flow guidance represents a 3% year-on-year increase. While we anticipate revenue growth, the top line in USD may decline due to Bolivia's accounting changes. EBITDA is expected to rise, with stable CapEx contributing to the equity free cash flow increase. Downside risks include legal costs and FX impacts, while upside potential exists if these risks do not materialize. - Bart Vanhaeren, CFO
Q: Can you provide an update on the regulatory process for your M&A projects in Colombia and Costa Rica? A: In Colombia, the merger filing is progressing well, and discussions with Telefonica are ongoing. We expect to close the transaction in the second half of the year. In Costa Rica, the regulatory process is following its path, with approvals expected around year-end. - Bart Vanhaeren, CFO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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