América Móvil, S.A.B. de C.V. (NYSE:AMX) Q4 2024 Earnings Call Transcript

América Móvil, S.A.B. de C.V. (NYSE:AMX) Q4 2024 Earnings Call Transcript February 12, 2025

Operator: Good morning. My name is Chad and I’ll be your conference operator today. At this time, I would like to welcome everyone to the América Móvil Fourth Quarter 2024 Conference Call and Webcast. [Operator Instructions] Thank you. Now I will turn the call over to Ms. Daniela Lecuona, Head of Investor Relations. Please go ahead.

Daniela Lecuona: Thank you. Good morning, everyone. Thank you for joining us today to discuss our fourth quarter financial and operating results. We have on the line Mr. Daniel Hajj, CEO; Mr. Oscar Von Hauske, COO; and Mr. Carlos Garcia Moreno, CFO.

Daniel Hajj: Thank you, Daniela. Welcome, everyone. Carlos is going to make a summary of the fourth quarter 2024 results.

Carlos Garcia Moreno: Thank you, Daniel. Good morning, everyone. Well, the fourth quarter ended with our renewed surge in U.S. interest rates, with 10-year treasury yields jumping approximately 80 basis points in the quarter to finish the year just shy of 4.6%, roughly the highest level since the end of April. This significant increase in long-term interest rates took place not long after the Fed reduced its policy rates by 50 basis points in September, 14 months after completing a period of policy rate hikes. Our stronger-than-expected labor market and economic activity led to major revisions in expectations regarding future reductions in policy rates by the Fed and hence the path of medium and long-term yields, all of which resulted in the spike in yields mentioned above.

Throughout the period, substantially all of the currencies in our region of operations depreciated versus the dollar with the Brazilian real experiencing the worst decline of all, 13.7%, followed by the Chilean peso, 11%; and the euro 7%. We added 2.1 million postpaid subscribers in the fourth quarter, with Brazil contributing 655,000; Colombia, 178,000; and Mexico 141,000. On our prepaid platform, we have registered 1.3 million net disconnections in the period. We had minus 1.8 million in Brazil after a cleanup profit space. But Mexico gained 302,000 subs, followed by Central America with 196,000; Colombia, 128,000; and Argentina 164,000. In the fixed line segment, we obtained 320,000 broadband accesses, including 132,000 in Mexico; 75,000 in Brazil and 45,000 in Argentina.

Voice lines and PayTV units registered minor losses in the period, 88,000 in all. Our postpaid base increased 5.3% year-on-year, with prepaid expanding 0.4% and fixed broadband accesses 4.7%. All the above figures include those reported by ClaroVTR in Chile over the last 2 months of 2024. Fourth quarter revenue was up 18% in Mexican peso terms to MXN237 billon, with service revenue planning 19.1% and EBITDA, 16.4% to MXN91 billion. Those rates have increased reflecting the consolidation of the Chilean operation from November 1, but were largely boosted by the accounting methodology associated with Argentinian operations. Since these operations take place in a country that is considered hyperinflationary, the annual revenues adjusted for inflation and expressed in December 2024 prices, then converted to Mexican peso at the end of the year exchange rate per rule IFRS 29.

The fourth quarter figures are obtained subtracting from the annual figures those obtained through September. Since Argentina’s rate of inflation was 118% through December whereas the Argentinian peso only depreciated 4% versus Mexican peso. It has depreciated sharply in December 2023. The accounting adjustments mentioned are considerable when expressed in Mexican pesos. Excluding Argentina and therefore those variations having to do with the accounting methodology, América Móvil’s fourth quarter revenue increased 10% in Mexican peso terms with 10.7% service revenue growth and 8.6% EBITDA growth. On the consolidation of the Chilean operation, its contributions to our consolidated revenue over the last 2 months of the year amounted to MXN3.3 billion.

Now at constant exchange rates and as has been customary in our quarterly reports, excluding Argentina from this calculation, our fourth quarter revenue rose 5.7% year-on-year on the back of a 6.6% service revenue increase, the best performance in over a year, with EBITDA expanding 5.1% before one-off adjustments and 7.2% after those adjustments were made. These increases include the impact of the consolidation of the Chilean operations that was felt more strongly in the fixed line platform as can be seen in the moment. Mobile service revenue expanded 6.2% year-on-year in the fourth quarter. Without Chile, it would have been up 5.1%, in line with the pace of growth seen in the prior three quarters. Postpaid revenue rose 8.5% in the quarter compared to 6.3% in the prior quarter, whereas prepaid revenue increased 2.5%, down slightly from 3.6% in the third quarter.

Mobile service revenue accelerated in Brazil, Colombia, Ecuador and Peru offsetting the deceleration observed in Mexico and Central America. Fixed line service revenue climbed 7.4%, including the Chilean operation and would have posted a 4% increase without it, in line with the increase observed in second quarter, but somewhat lower than the growth rate of the third quarter. Broadband revenue growth accelerated to 9.8% pace from 7.4% in the prior quarter and corporate networks revenue to 12.3% from 10.1%, with PayTV revenue growth hitting 5.2% compared to a 0.8% decline in the third quarter. Fixed service revenue growth decelerated in Mexico, Brazil and Colombia from the pace in the prior quarter, but increased at a faster pace in Austria and Eastern Europe as well as in Central America.

América Móvil experienced an operating profit of MXN46.4 billion in the fourth quarter, 11% higher than that of the year earlier quarter after depreciation and amortization charges that increased 22.6% reflecting partly consolidation of the Chilean operation, inflationary adjustments of the Argentinean assets and the amortization of new license acquired in ‘23 and ‘24 in Austria and Colombia. Our net income came in at MXN9.5 billion in the fourth quarter and was 47.5% lower year-on-year on account of higher comprehensive financing costs. These totaled MXN30 billion, nearly half of which was associated with foreign exchange losses. Our net income was equivalent to MXN0.15 per share and $0.15 per ADR. And our net debt ended the year at MXN488 billion, excluding capitalized lease obligations.

In cash flow terms, it increased MXN19 billion over the year and kept us in line at MXN131 billion in capital expenditures, MXN51 billion in shareholder distributions. These are net of the dividends received from our variation stakes and MXN24 billion in the amortization of labor obligations. At the end of the year, our net debt stood at 1.44x last 12 months EBITDA. The latter figure already reflects the impact of the consolidation of ClaroVTR in Chile – in América Móvil from October – from the end of October. So with that, I would thank you and hand the floor back to Daniel. Thank you.

Daniel Hajj: Thank you, Carlos. I think we can start with Q&A.

Q&A Session

Operator: Thank you. [Operator Instructions] So the first question comes from Carlos de Legarreta from Itau BBA. Your line is now open.

Carlos de Legarreta: Thank you. Good morning, everybody. I have two questions on my end, please. The first one is and if you have a specific CapEx guidance for this year, given obviously the sharp FX movements, I don’t know if there is any deviation from what you guided at Investor Day? And secondly, in Brazil, maybe Daniel, you can talk about the details of the MVNO deal with Nubank. I am just concerned if there is any – or are you at all concerned if there is any potential for cannibalization of your own product or in terms of network capacity, if there is any kind of concern at all given that they might become very large at some point?

Carlos Garcia Moreno: Hi, Carlos. On the CapEx, I think we gave guidance for the 3 years. I think we are on that guidance, including what we are incorporating the CapEx of Chile. So we still don’t know exactly what’s going to be the CapEx for Chile for this year. But what we have is we do 3-year CapEx in Chile ‘23, ‘24 and 225. I think this year is the last year where we have – we’re going to change the network, modernize our network, 5G, we are going to put more coverage. We are going to do fiber, more redundancies. We are doing a lot of things in Chile. We are on track there. We have a very good management in Chile. So we are very happy the way Chile is evolving right now. And with this, I think we are still not sure, maybe could be 250 million to 300 million more of Chile, still we don’t know for this last year.

And then both the CapEx and the guidance that we gave last time is still the same plus what we are going to put in Chile for this year. I think next year in Chile, maybe can reduce. But this year, we are finalizing the last set – the 3-year plan that we have to modernize all the networks that we have. In Brazil, with Nubank, we are happy with them. We are doing okay. And we are not worried that Nubank can cannibalize our prepaid subscribers. So we are happy. I think it’s a very good alliance that we have with them and we are doing okay. So it’s okay, good naming, a good – they recharge a lot with Nubank. And so we are doing very good.

Carlos de Legarreta: Okay, thank you.

Carlos Garcia Moreno: Thank you.

Operator: The next question is from Walter Piecyk from LightShed Partners. Your line is now open.

Unidentified Analyst: Hi, good morning. Joe on for Walt. Thanks for taking the question. I kind of have a follow-up. Even with Chile included in the CapEx guidance, I guess the range that you had set at the Analyst Day of ‘22 to ‘24, it kind of seems like you are going to come in towards the low end. Is there any reason or what would push that towards the higher end at this point?

Carlos Garcia Moreno: No. Look, what we said last time is that we’re going to do MXN22 billion in 3 years. It’s what we have. With that, I think we need to include Chile. And I think we are okay with that. So we don’t go into the high end. What I can tell you this year in fall 2024 is we have less CapEx of what we budget. We have a very good revenue increase. And we have a better cash flow than what we have seen budget. So I think that’s the trend that we had in 2024 and that’s what we’re looking to have in 2025. So we are being careful on CapEx, but we are investing where we think we need to invest to get more revenue. So that’s the way we are looking. And the numbers are there, MXN22 billion we said for 3 years, we are with that and that’s more or less Chile, I think, is going to require this year a little bit more on what we are going to have for the next year because we are finalizing what I said the 3-year plan.

But the rest, I think we are okay. We are putting – other things that will be important is that we have also this year some spectrum renovations and acquire more 5G spectrum. But I think this year we will finish almost everything on that. So also for next year 2026, I think spectrum and renovations will go at also lower. So that’s what I can see in the CapEx.

Unidentified Analyst: Okay. And then either, I guess, Daniel or Oscar, T-Mobile started offering Starlink satellite to sell texting to its subscribers. And I believe last quarter you mentioned that you were working with SpaceX and AST. So have you guys started testing, either or both of those? And can you provide an update on either of those tests?

Daniel Hajj: No, what we said is that we use these low orbit satellites to use for backbone is what I said. We are not working only with SpaceX. We are working with all of them, less with the SpaceX than with the other one. So we are working more with OneWeb and the other one, I don’t remember the name AST and we are working with them. And we are….

Carlos Garcia Moreno: Not directly…

Daniel Hajj: Yes, only for the backbone. We are not doing nothing directly to the phone at this moment. And we are still looking and reviewing if that makes sense for us or not. So that’s where we are. But right now, we don’t have anything on direct to the phone with any of the satellite companies only doing for backbone in the rural areas, where we think we needed, where it’s more expensive to put fiber or microwave than we put satellite. So that’s more or less what we’re doing.

Unidentified Analyst: Okay, got it. Thank you.

Daniel Hajj: Thank you.

Operator: Thank you. The next question is from Marcelo Santos from JPMorgan. Your line is now open.

Marcelo Santos: Hi, good morning. Thanks for the opportunity for taking questions. I have two. The first is on Mexican broadband. Could you please comment a bit on the pricing environment, if you plan to increase prices this year? I understand last year, you kept your prices. So what’s the outlook for this year? And the second question is about M&A, there is a discussion, at least when you read in the press about potential M&A in Argentina. How do you feel about that? What is the appetite of América Móvil to see opportunities there? Thank you.

Daniel Hajj: Oscar can talk a little bit about the broadband.

Oscar Von Hauske: Yes, yes. In Mexico, right now, we already have 85% of the customer connected with fiber. We don’t see to increase the prices. What we did is to launch our new packages in the market for residential, I think it’s very unique packages. And we believe that it involves our net adds this year and these are prices that include Netflix for 6 months for free, includes ClaroVTR with Paramount and as well antivirus. It’s a fully symmetrical connectivity with fiber. We include an e-mail as well in the proposal. So we are adding value to the connectivity. Another sector that we are really focused on is in small business as well and then we launch packages that includes sorry, backup of information for the customers name.

We designed the webpage for a small business. We delivered electronic bill for small business for the same trend that we used to have, adding value to the broadband connectivity. And as well on the corporate, we mentioned before, we are adding different services, cybersecurity, cloud, vertical and horizontal solutions for corporate market. So, we believe with those this bundle and packages, we are very well positioned in the market to expect an increase in net adds for this year.

Daniel Hajj: And on the Argentina, well, what I can tell you is that I read it also in the news this morning, we haven’t talked with anyone on anything there. Of course, we are open. We are open always to see everything, and let’s see that makes – synergies that make sense for us, we can be open to review that, but we haven’t talked with them and we haven’t had anything at this moment.

Marcelo Santos: Just to clarify on Oscar’s answer, so you said you do not seek to increase prices, right? You launched the bundles, but on prices, you do not seek to increase.

Oscar Von Hauske: Until now.

Daniel Hajj: Yes, until now, we don’t think to do it. We don’t know if that makes sense at the mid or end of the year. But at this time, we haven’t had anything on increasing prices.

Marcelo Santos: Thank you.

Daniel Hajj: Thank you.

Operator: The next question is from Vitor Tomita from Goldman Sachs. Your line is now open.

Vitor Tomita: Hello. Good morning all and thanks for taking our questions. We have two questions from my side. The first one is if you could give us some more color on how you see prepaid revenue trends in Mexico in more detail in terms of how much user – how much users are recharging, how frequently they are recharging, how you are seeing those trends evolving? And our second question would be also related to prepaid in Mexico, if you could give us an update on how you have seen the competitive environment for prepaid in Mexico between the big operators, MVNOs competition in general? Thank you very much.

Daniel Hajj: Well, talking a little bit about the competition in Mexico, well, what we have been seeing, let’s talk first about postpaid. Postpaid, we are doing very good. We’re increasing revenue. I think the revenue we increased 5.7%, something like that, more than a year before and more than the second and third quarter of last year. So we – in postpaid, we are doing good. Why we’re doing good? Well, we have – we are moving also some customers from prepaid to postpaid. And we are moving our postpaid from better plans and selling more things. So, the ARPU that we have in Telcel is maybe in postpaid maybe 20% higher than our next competitor. So we have very good customers. We are – they are in very good plans. And we are doing very good in the postpaid side, okay.

In the prepaid side, what I’m seeing is, I don’t see any change on the competition, it’s the same competitors that we have been having. I don’t think they are more aggressive or less aggressive. They are – they have been aggressive for maybe 2, 3 years. And still, they are doing that. As I said, we are moving part of our prepaid base to postpaid. And the third one is, we’re seeing also a slowdown on the economy. I think that’s very important. And when you see a slowdown in the economy of Mexico, then the first place where you see slowdown is in recharge in prepaid. So, that’s what we are looking. No big changes in competition. We have the same, maybe CFE is giving and promote some chips, but more than that, we haven’t seen anything else on that.

And there’s tough competition in Mexico, but it’s not the last quarter. It has been there for the last 2 years. What we have been seeing is a slowdown in the economy, and that is to the prepaid recharge that we have been having. So that’s more or less what I can – what I’ve seen in the market in Mexico. So Oscar talked a little bit about the broadband. We are doing good. We’re growing. We’re moving to fiber. Postpaid, we are also doing good, moving subscriber to better plan, moving the high-end prepaid to the low-end postpaid that has been very successful, around 85 percent of the people that we move stage in postpaid. So it’s a very good number. So all overall, we are doing okay in that. And the second and very important that Oscar reminds me right now is that we have very – by far, the best network in Mexico, we are the only ones that have 5G, the real 5G.

We have more than 100 cities, very well coverage, very good speed good quality. And well, that’s why we have the best postpaid customers right now.

Vitor Tomita: Thank you very much.

Operator: The next question is from Andrés Coello from Scotiabank. Your line is now open.

Andrés Coello: Thank you. Thank you for taking my question. On Mexico, please. First, we saw last year two constitutional reforms, one given the CFE special legal status in Mexico. And then there was also the reform that is going to merge two regulators into single body. So, Daniel, I am just wondering what you are seeing in terms of the regulatory environment in the country with these constitutional reforms. And perhaps, more specifically, how do you see the company competing with the government, right, because the government is now providing retail services, so you will be on that? And my second question is on Telmex. There was a letter published by management and the union where Telmex says that this year, they expect to win 2 million broadband lines in Mexico and market share to reach 50%. So, I am just wondering if this is feasible, if you think that, that is – or perhaps too ambitious to think of 2 million broadband additions in Mexico. Thank you.

Daniel Hajj: Well, of course, it’s an internal budget that we have. And of course, we want to win, if it’s 2 million or more than 2 million. So, all the commercial areas, marketing people working in the streets are looking to grow is what we want. We want to increase our market share in Telmex. That’s why we don’t increase prices last year. We lose some market share in the previous years, and we want to recuperate part of this market share. And I am happy that the union and all the people is focusing on making more broadband subscribers and winning more broadband. So, I am happy it’s visible, well, all the budgets that we do are feasible. We don’t know if the economy will allow us to do as much as that. But we want to do it.

Maybe it could be around 150,000 per month. I don’t know, if we can do it, but we are looking to do that. We have enough fiber. We are also changing subscribers from copper to fiber. So, there is still a lot of things that we have to do. As Oscar said, we have 85% of our subscriber broadband in fiber, and it’s a very good news. So, if we look 3 years ago, I don’t think we have those numbers. So, we have been working very, very hard to move all the – all our subscribers to fiber. So, that’s what we have. In terms of the 80% [ph], well, what we have been seeing is that right now, they are looking for the secondary loss, they are moving on that. We don’t know exactly what are going to be the secondary loss. We are waiting for that and CSO, we are aiming to work with any, I think part is going to go to economy.

The other part that is going to go to digital and we are going to work with both to do that. If we are going to compete – hope that what the government is saying is that what they want to do is to give connectivity in the very, very rural area. So, I hope they are working and doing to do connectivity in those rural areas. But that’s more or less what I have, then I don’t know – but that’s what we have.

Andrés Coello: Okay. Thank you.

Daniel Hajj: Thank you.

Operator: The next question is from Alejandro Azar from GBM. Your line is now open.

Alejandro Azar: Hi. Good morning and thank you for taking my questions. Two quick ones, one is on the cloud and corporate networks. If you can remind us how much that business grew in 2024? And if you can tell us from your $7 billion, $7.5 billion CapEx, how much is that directed to that business segment. And the other one would be on your pension plan. You mentioned $25 billion uses or cash outflows during 2024. My question would be that is 100% cash flows? And how should we think about your pension plan outflows in the next, let’s say, I don’t know, decade should that decline at some point, and why? Thank you.

Daniel Hajj: Well, what I can tell you is that the segment that are growing more are postpaid and the corporate segment. Those are the two segments that are growing more in América Móvil. I think the corporate I think is growing around 15%, something like that, revenues. I think fixed exchange rate for everyone, including Chile, that’s 12.3%.

Oscar Von Hauske: 12.3%, yes.

Daniel Hajj: And it’s been accelerating. It was 7% in the second quarter, 10% in the third quarter and 12% in the fourth quarter. What is very important, we have been putting a good CapEx, it’s difficult to divide what CapEx is for cloud and corporate and the other ones. But we have – we are very well prepaid in all Latin America to serve the corporate market to – we have good salespeople. We have data centers. We have good alliances. So, we are very well prepared to grow in the corporate market. So, I think we are – I am very confident that in the next years, we are going to be a good player, a big player in the corporate market. So – and on the pension fund, I think the trends should be declining. I think we will expect to see still some outflows more or less of the same size as we had last year for some time over the next 3 years, so.

And then we would expect them to be a little bit declining. And that has to do with the overall trend. I think that we have reached the peak of pension payments and they will be trending down. There is less people being pensioned, new people and some people that have pension that will cease to receive pensions at some point, okay. So, that’s basically – we can talk more about at next Investor Day call.

Alejandro Azar: Thank you. Thank you both.

Oscar Von Hauske: Thank you.

Operator: [Operator Instructions] The next question is from Phani Kanumuri from HSBC. Your line is now open.

Phani Kanumuri: Hi everyone. Thanks for taking my questions. The first one is related to the outlook for shareholder remunerations in 2025. Given the FX changes and increased CapEx, how do you see the outlook for shareholder remuneration in 2025? The second one is regarding how you feel about Brazil mobile. Do you see the rationale [ph] market environment continuing there? And you have grown like 10% in 2024. Do you see that growth rate trending in the same range in 2025? Thank you.

Daniel Hajj: Well, on the first question, if you look at the basic trends that we are having today, we have had a very solid revenue growth for a long time now. We have growth on both fixed and mobile, which we have been highlighting for quite some time. And this is already very well diversified. We are doing it in all the main countries and these blocks of countries like Central America and Eastern Europe. And what we are seeing is that on the back of very strong and consistent top line growth, we are also being able to reduce the CapEx intensity of the business, given the important investments that we have made in the past, including introducing all the necessary investments to be able to introduce 5G basically in all our markets and also the spectrum that has to go with that.

So, all of that is behind us, and that’s why we have been able to reduce the CapEx to sales intensity significantly, we expect it will be remaining in that position. So, given what I have said, I think the outlook is for the possibility for free cash flow expansion with a position of leverage that will remain not far from where we are, okay. We are at 1.4x net debt to EBITDA. It’s right in the middle of the range where we want it to be. So, that you can run the numbers and you will see that we don’t need more cash for debt, and we don’t need more cash for CapEx. That means that there is going to be more cash available for distributions. And on Brazil, I think we are like we have like 40%, something like that 38% to 40% share of market in 5G.

So, we are one of the biggest in Brazil. We have a very good network, the fastest network, ANATEL is saying that we are the fastest network in Brazil. And we have been growing market share in Brazil for – in postpaid for some years. So, we are well prepared. We are investing, and we have seen – had good results, very good management, good team, good synergies that we have been having. So, we are – I think we can still do a very good year – the next years, we are going to be building Brazil.

Phani Kanumuri: Thanks everyone.

Operator: Thank you. The next question is from Gustavo Farias from UBS. Your line is now open.

Gustavo Farias: Hi and thanks for taking the questions. I have two on my end. The first one is regarding mobile competition in Brazil. We have seen a competitor that doesn’t expect to raise from prices in the first half of the year. So, my question is if you could comment on how do you see competition in Brazil? Do you see it worsening or not? And the second question is regarding the debt profile and how do you see it in the longer term. So, how much if you have any target of how much of the debt we would like to see denominated in hard currencies as a percentage of total in 5 plus years from now? Thank you.

Daniel Hajj: Can you repeat the second question, please? We don’t hear you well.

Gustavo Farias: Regarding the debt profile – for sure, the debt profile, how do you see it in the longer term? How much of the debt you would like to see denominated in hard currencies as a percentage of total.

Daniel Hajj: Well, on the debt composition – we have been – as you know, I think you have to distinguish between funding on the one hand and then the actual currency exposure that we retained. We have been funding increasingly in local currencies. We have been raising funds a bit more than $1 billion over the last six months in various local markets here in Latin America. And what we do with the currency exposure, we basically managed through derivatives and that basically is managed depending on our views of what the currencies are. So, what I can tell you is that to raise the net exposure to dollars, for instance, is 32% of net debt. And the net exposure to other countries– to Europe, and including Austria would be about 10%, okay.

So, that means that the net economic exposure is basically around 60% to local currency today. And you are talking about Brazil, I think competition, not only in Brazil, in all Latin America is we have a lot of competition there. We have let’s say, in Brazil, we have Telefónica, we have Team. And then in mobile, and then we have all the new ones, the small ones that are growing. So, well, in telecommunications, everybody knows that you have to have – it’s not only price. When you compete only in price, then I think you are going to lose value in the future. You need to compete with quality, with coverage, with good products and with the customer care. So, you need to do a lot of things and those means investments, CapEx, and we have been doing that in Latin America for the last 10 years or for the last 20 years.

So, I think we are well prepared to compete not only in price, well, we have been digitalizing the company, working a lot on cost and expenses. And that’s, let’s say, in Colombia. Colombia, we have nobody talks about Colombia, but we have a very good quarter. We start with revenues growing at the beginning of last year with 1%, 2%, we are growing 8% in this quarter in prepaid. So, we are doing good, because we have the basis and we have the investments done. And of course, we have some competition on price, then we have to do it. But then we return with good customers, good ARPUs, good products to sell there. So, all around Latin America and Europe, we have competitors, telecommunications is with a lot of competition, but we are well prepared to compete with them.

Operator: Thank you. The next question is from Ernesto González from Morgan Stanley. Your line is now open.

Ernesto González: Hi. Thank you for taking my question. Two quick ones, can you please discuss how you are seeing competitive dynamics in Colombia, which you started to mention a moment ago and also competitive dynamics in Chile. Thank you.

Daniel Hajj: Well, in Colombia, I think Tigo and Telefónica are getting together the network. I don’t know if they are going to allow them to consolidate the – and but the networks, I think they are working and have a good network. I think it’s good. They are going to save money. There is more stronger competitor that is good for us. But as I have said, in Colombia, if you review the numbers that we have this quarter are very good. And I think for 2025, we still think that we can increase and have better numbers. Revenue is growing. And we are good in the market. Well, I don’t know exactly what is going to happen, there is going to be a new investor in one. So, we don’t know exactly what they are going to do. But we are in a good position.

And in Chile, I think in Chile, we have a lot of competition, different in broadband and in mobile. But what I can tell in Chile is we have been working including ‘23 and ‘24. We have a very good management. They are delivering what they promise. So, we are in the numbers and the investments that we are doing are being good. And I think Chile, this year, we are going to consolidate all the synergies that we have between the two companies. We are going to have a much better network. We have a very good team working there. So, we think we are going to have good numbers in Chile. Let’s say, in Chile number portability, we have been gaining subscribers in number portability for the last six months or seven months. And that means that the network is working that we have good plans and that we are doing okay.

So, we are okay, and they are delivering – we are delivering what they are promising in Chile.

Ernesto González: Thank you.

Daniel Hajj: Thank you very much.

Operator: Thank you. We have a question from Juan Cruz from Morgan Stanley. Your line is now open.

Juan Cruz: Hi. Good morning and thank you for the call. Just following up on the Chilean operation, now that the ClaroVTR has been formally incorporated into the results, when should we expect more disclosure as to both operationally and financially as to how the Chilean operation is doing going forward? And secondly, if you could tell us what the CapEx budget for Chile should be for 2025, if you have that number handy would be great. Thank you.

Oscar Von Hauske: Well, we will begin reporting the Chilean results next quarter. Likely, we will be discussing it together reports of other countries that are in the region. So, putting them together – putting them with the so-called Southern Cone countries. But I think that’s what we will be beginning – to begin from the first quarter of 2025. And on the CapEx…

Daniel Hajj: And the CapEx on Chile, we said that it’s going to be around $250 million this year to finalize everything that we have, change more to fiber, more coverage, more 5G. So, that’s more or less what we budget. We still haven’t finished this budget, but we think that it will be like the $250 million, a little bit more, a little bit less on CapEx for 2025.

Juan Cruz: Okay. Thank you.

Daniel Hajj: Thank you.

Operator: We have a question from Vitor Tomita from Goldman Sachs. Your line is now open.

Vitor Tomita: Hi. Thank you for taking my questions. [Technical Difficulty] Two questions regarding to Mexico, the first one is how do you see the competition of the MVNO of Walmex, but they have like 15 million clients in the last 2 years. Obviously, it’s in the low end of the range. And the second question, if I may, is how do you – we can see lower revenues in equipment sales. Do you believe that this trend will continue? Thank you so much.

Daniel Hajj: Yes, that’s right. We reduced the revenues on equipment. I think also it’s a little bit of what we talk about the economy. The economy is slowing a little bit down. So, that’s – and the other thing is all these revenues are based in dollars. So, if the dollar moves from 17 in June to 20.5 in December, so equipment gets a little bit more expensive. So, that’s why we reduced some revenues on that. On Walmex, it’s a good competitor, a strong competitor. They have good distribution. And well, it’s not new. As you said, they are going to the low – they have – with 40 million subscribers. There are, I don’t know exactly the revenues, but the last time that we see the revenues and the ARPU is very low.

So, I don’t know if they really have 40 million or not, we don’t know. But it’s more competition in Mexico, nothing new. We have been dealing with Walmex for the last 2 years, with CFE also. And then we have Telefónica and then we have AT&T. So, a lot of competition in Mexico, but nothing new, so that’s what we have been having for the last year. So, that’s – and still, we are going to have competition this year, hope that the economy can return and be stronger in the next months. But still, we are seeing that the slowdown in the economy is hurting a little bit the prepaid subscribers.

Vitor Tomita: Thank you so much.

Daniel Hajj: Thank you.

Operator: Thank you. We have no further questions. So, I would like to hand the call back to Mr. Daniel Hajj to conclude.

Daniel Hajj: I want to thank everyone for being in the call and see you next quarter. Thank you very much.

Operator: Thank you. This concludes today’s call. Thank you all for joining. You may now disconnect.