Cellnex Telecom Sa Ord

Hello, good afternoon, everyone. Welcome to our first quarter 2026 conference call, results of conference call. Before we begin, I'd like to remind you that the presentation contains forward-looking statements, and please refer to the disclaimer included in the appendix to the slides. So Marco Patuano, our CEO, will open with the main highlights of our results and some strategic commentary. And then our CFO, Ramon Trieres, We'll take you through some more details on the results for this quarter. And then we'll be available to take your questions as usual. In addition to the slides in the pack that we've just posted on the website, we've also included, as we have in the last couple of quarters, some frequently asked questions slides. And in addition, we're highlighting some IR materials in the back of the presentation that is now available on our website. and that covers some of the more recurrent themes that come up in conversations with you and our investors, and we hope you find them useful. So with that, let me hand over to Mark.

Thank you. Thank you, Maria. Good evening, everyone. It's a pleasure to be with you again as we open Q1 2026 and reflect on what has been a strong start to the year. In Q126, we continue to deliver on all fronts, confirming the resilience and predictability of our industrial model. The microenvironment remains volatile. We continue to execute our strategy with conviction, and our results speak for themselves. Let me take you through the five key themes of this slide. The first is on operating and financial performance. Our business fundamentals remain very healthy. as shown by the 4.7% year-on-year growth in POPs, demonstrating a sustained demand from our customers across the portfolio. And we had another strong quarter in terms of organic financial performance, reflecting the solid performance of all our business drivers and our ability to drive operating leverage. So revenues, plus 4.7%. Adjusted EBITDA, plus 6.4%. EBITDA after lease, by 7.2%, with margin expanding from 58.8% to 60.5%, led by the ongoing efficiencies measures and proactive management initiatives. The recurring levered free cash flow grew by 12.2%, and on a per share basis, the increase was 18%, combining the impact on organic growth in our share buyback program. As a second point, I would like to highlight the consolidation of our free cash flow turning point. We generated €118 million of free cash flow in Q126, an increase of €184 million versus Q125. Free cash flow is no longer a forward-looking commitment. It's here. It's growing. Third point, a comment on macro and capital markets. Our revenue and cost structure remains naturally hedged against inflation, and our balance sheet is well insulated from rate volatility with ample cash and undrawn revolving credit facilities, providing funding optionality to avoid unfavorable market windows. I will talk a little bit more about this point. The fourth point is on asset rotation. In Q126, we cashed in the proceeds from the disposal of our French data center, which was 373 million, and from the DIV2 fund participation, which was 170 million. This transaction further sharpened our focus on core telecom infrastructure assets and enhanced our financial flexibility. And last, the fifth, shareholder remuneration. 2026 dividends total 500 million, two equal tranches. The first tranche has already been paid 250 million on January 15, 2026. And the second tranche of the other 250 million is going to be paid on July 15, 2026. Our share buyback program continued throughout the quarter with 60 million executed in Q1, 2026. As of 31st of March, 2026, $260 million out of the $500 million announced on November 6th has already been completed, and the outstanding balance is on track to be completed by year-end 2026. So I ask you kindly to move to slide five, where I want to take a moment to reinforce why our business is structurally resilient in the current environment. Our micro-protection framework rests on four pillars, revenue, costs, rates, and liquidity. which offer protection in the volatile environment we are living in. On revenues, 65% of our revenues are linked to inflation, and a further 35% are fixed escalators, meaning that our entire revenue base has built-in growth mechanisms regardless of the inflation environment. On costs, approximately 80% of our energy consumption is directly passed through to tenants by contract. and the remaining residual exposure is hedged through forward contracts and PPAs. In practice, our energy cost base is almost entirely price protected. OPEX growth is below inflation, which drives margin expansion and reinforces operating leverage. So, net inflation exposure results to be positive. On rates, 78% of our debt is at fixed rate, providing contained exposure to rate fluctuations. Our variable debt, 22% of the total, is linked to the one-month URIBOR, which has shown relatively low volatility, and is further protected through a pre-edge mechanism. Our average maturity is 4.3 years, and it gives us a balanced refinancing profile, spread over various years, avoiding any near-term concentration risk. and liquidity. We entered the quarter with approximately $6 billion of liquidity, $3 billion in cash, and a further $3 billion in non-drone committed revolving credit facilities. Our 2026 maturities are fully funded, and we maintain the flexibility to top bond markets opportunistically when market conditions are going to be considered favorable. As you may recall, in Q126, we issued a dual series bonds for 1.5 billion euro to pre-fund our 2026 refinancing needs, extending maturities to 5 and 10 years and securing pricing at an average of 3.4%. This framework is not new. It has been a cornerstone of our investment case since our capital market day. And it is increasingly visible in our number quarter after quarter. Let's move now to slide 6. I want to take a moment to show you that our margin expansion story is not a recent deployment. It is a multi-year trend, and it is accelerating. On a pro forma basis, excluding Ireland, French data center, the O&M business is continuing in Spain, our EBITDA margin has expanded consistently from 82.7% in Q123 to 84.7% in Q126. Its 200 basis point of expansion over three years driven by continued organic growth, operational transformation of our industrial platform, strict cost discipline, and inerrant operating leverage of our infrastructure model. But the ADDA after lease picture is even more compelling. ADDA after lease margin moved from 55.3% in Q123 to 60.6% in Q126. more than 530 basis points of improvements in the same timeframe. This reflects not only EBITDA progress, but also the tangible results of our proactive land management program, which is structurally reducing our lease cost base over time. The trajectory of success is clear, and possibly there is more to come. In slidesharing, I want to spend a few minutes on a topic that I know is in front of mind for many of you. So the M&O consolidation in France and specifically the SFR process. I want to be direct. We are well positioned, well protected, and we intend to be a proactive and constructive part for the solution. Let me walk you through our exposure and the contractual protection we have in place. We operate approximately 33,000 POPs across 27,000 sites in France. Our contracts are structured to require Celnex consent for any changes to the MSAs, including transfer or contract splits, which means that we are a necessary party in any consolidation scenario. In terms of our exposure to the SFR-related process, out of our total SFR POPs, approximately 12,000, a little over 40% are located in dense areas. Of those, less than 10% are non-anchor POPs. In rural areas, the crew zone areas represent 57% of the POP outside dense areas. Risk is very low. Run sharing between SFR and Buiga is already in place in these areas, and secondary contracts have already been renewed for 10 or 12 years. providing long-term visibility on that portion of the portfolio. We have performed extensive analysis of potential overlap post-consolidation, and it is confirmed that estimated impact remains limited. And critically, from a structural demand perspective, France ranks 49th globally in the 4G, 5G availability according to Oprah Signal. Densification is needed in urban areas, and the RCEP New Deal and the 5G obligation require further rollout by 2030. This means that regardless of ownership structure, network investment must continue, and Selinex is the natural partner. On the contractual structure, you can see at the top left of the slide, our long-term MSA agreement, maturing in more than 10 years with all or nothing extension, and also the secondary contracts were both recently renewed in 2023. As a leading provider of critical infrastructure in the French market, Cellnex will inevitably have to be part of the discussion and an enabler for a solution that is beneficial for all. Our objective is straightforward. Preserve the NPV of our contracts, secure relationship with financially healthy clients, and minimize any pop losses while maximizing the use of committed and future densification programs. I want also to set the right expectation on timing. This is a complex regulatory and commercial process, and it is not likely to be solved quickly. We're talking about a multi-year journey. one that will involve regulatory review, commercial negotiation, technological realignment, careful sequencing, of course, multiple parties. And all this will be happening whilst operations still need to deliver best-in-class communication experiences to their customers. From Sunlux's perspective, that is not a source of concern. It is actually a source of conflict. Our contracts are long-term, our protections are contractual, and time works in our favor. We are in no rush, and we will not be pressured into outcomes that do not preserve the full value of our infrastructures. We are available to support our customers throughout this strategic transformation of their business, but with full visibility on the strength of our position and the conviction that we will achieve an outcome that is positive for our customers and for us. We will keep you updated as the process evolves. Honestly, there has been no change in the fundamental of our business. We recently covered the key dynamics of the markets and our business in detail, including our position regarding the ongoing discussion between Inred, Astrid, Vodafone, and team. We had a fireside chat hosted by Morgan Stanley on March 31st, 2026, and the full recording and supporting materials are available on our IR website. So, I encourage you to refer to the session for a comprehensive view of our perspective on the Italian market. You will find a direct link to the IR materials at the end of this result presentation. So, after this rush, so let me hand over to Raimond, who will walk you through the details of our Q1 2026 results.

Thank you, Marco. Good evening, everyone. I would like to start by reinforcing the very positive performance we delivered in the first quarter 26 in terms of organic growth and cash conversion. Revious revenue growth combined with continued focus on operational excellence is driving higher profitability, stronger operating leverage, and expanding cash flow. As you can see in the slide, the improvement is visible across every step of the waterfall. On a pro forma basis, starting with organic revenue growth, we delivered a solid 4.7% year-on-year. Adjusted EBITDA grew by 6.4%, supported by our ongoing business transformation and increased operational efficiencies. EBITDA after lease was 7.2% higher, incorporating our proactive lease management activity. And the recurring level free cash flow rose by 12.2% year-on-year, supported by the disciplined implementation of our capital allocation strategy. The headline metric that reflects our focus on shareholder value creation, recurrent level free cash flow per share, grew by 18%, driven not only by operational improvement and disciplined financial management, but also by the continued execution of our share buyback program. As usual, on slide 10, we show you the bridge between the reported and organic pro forma revenue growth. Starting from 964 million of leverage in the first quarter 25, the perimeter adjustment for Ireland, the French data centers, and the O&M business line discontinued in Spain brings us to a pro forma revenue base of 941 million euros. From there, the combination of escalators and CPI contributing 14 million euros, colocation and other business adding 9 million euros, and built-to-suit and fiber revenues of 21 million euros, led to organic revenue growth on a like-for-like basis of 4.7%, bringing organic revenues to 985 million euros. A small combined FX and perimeter adjustment of 1 million takes reported numbers of the first quarter 26 revenues to 984 million euros. The strong organic revenue performance is laid by consistent POPs growth. As you can see in the next slide, gross POP growth was 5.4% year on year, and net POP growth was 4.7%. Let me give you some further detail. In the first quarter 26 we added 1,772 gross new pots, comprising 962 from gross collocation and 810 from B2S additions. Churn was contained at 885, of which Spain accounts for the majority. This gives us 1,587 net new pots in the quarter. If we look at it on a country-by-country, France was the lead country, mainly by the solid rollout of our build-to-suit programs with Iliad and SFR. Italy's performance was driven by fast-work Vodafone and Iliad run-sharing program, while Poland continues to deliver the execution of build-to-suit with play. In Spain, a program churned from the Masoran's deal was offset with an additional build-to-suit and organic road in POPs. evidence of continued demand for network densification and coverage in the Spanish market. The sequential trend is consistent with typical seasonal pattern. First quarter is historically a softer quarter for collocation activity, with momentum building progressively through the year, as you can see in the chart at the bottom. I would like to highlight that the net POPs in the first quarter 26 is 28% higher than the same quarter last year. The strength of our operational performance flows directly into tower revenues, which grew organically by 5.3% above the consolidated revenue growth rate, reflecting the continued outperformance of our core business, as you can see in the slide 12. Starting from 778 million euros of tower revenues in the first quarter of 2025, The island perimeter adjustment brings us to a pro forma base of 767 million euros. From there, escalators and CPI contributed 13 million euros, colocation added 10 million euros, and build-to-sweep generated 18 million euros, reaching organic power revenue growth of 5.3%. After an FX perimeter adjustment, an order of minus 7 million reported tower revenues in the first quarter came in at 801 million euros. Moving to slide 13, let me cover our other business lines. Fiber connectivity and housing services grew 4.3% organically, adjusted for the French data center disposal, and supported by the continued rollout of the Nextloop project in France. Thus, small-cell and run-as-a-service grew 1.1% organically, adjusted for the O&M activity discontinued in Spain. Within this segment, dust and small-cells delivered a growth of over 16% year-on-year, reflecting a strong momentum in the UK and other key markets. The quarter was negatively impacted by lower trading projects in the first quarter and the FX impacts from the run in Poland. Broadcasting grew 0.2% organically. As agreed in the 2025 contract renewal, CPI indexation will start contributing from April 26, so we expect a more meaningful contribution from broadcasting in the second quarter onwards. The next slide captures how our continued focus on operational efficiency is translating into tangible cost improvements across all key expenses lines. All metrics are on a pro forma basis, again excluding Ireland, the French data centers, and the O&M business in Spain. Our efficiency initiatives are translated interior margin expansion, minus 5.7% in staff cost, plus 4.6% in repair and maintenance impacted in this quarter by timing effects, but we expect for the full year 26 a reduction in line with our efficiency plan proof on prior results trends. SG&A was down 13% and leases 0.2% enhanced by our land acquisition plan that is accelerating and the rent renegotiations and cash advances. In summary, the operational efficiency is not limited to top line growth. It runs through the full cost structure. Moving to slide 15, the slide shows the bridge from reported EBITDA after leases to free cash flow, and all the components that shaped our cash generation in the first quarter of 2026. Starting from a redoubt of 595 million euros, after maintenance capex of minus 20 million, working capital of 37 million negative, net interest paid of 122 and tax paid of minus 39 million euros, we arrive at a recurring level free cash flow of 378 million euros. The adapting expansion capex of 67 and the build-to-suit capex of 193 million euros, the free cash flow comes in at 118 million euros. As Marco mentioned, the turning point when compared to the same quarter last year, where the free cash flow was minus 66 million euros. The strong free cash flow generation in the first quarter 26 is driven by three main factors. Operational performance, our efficient capital and taxes factor with optimized cost of debt, and lower capex intensity as the build to suit cycle normalizes. Moving to the next slide, our operational improvements are clearly flowing through to cash, and this slide puts that in perspective. On a pro forma basis, recurrent labor free cash flow grew by 12.2% to 363 from 323 million euros in the first quarter of 2025. Recurrent labor free cash flow per share increased by 18%, with additional per share improvement coming from our ongoing share-by-back program, which continues to reduce the share count and enhance value per share. Looking at reported free cash flow, It reached 118 million euros in the first quarter 26 versus minus 66 million in the first quarter 25. An improvement year on year of 184 million euros. As explained before, this improvement is driven by solid recurrent level of free cash flow growth by lower intensity of CAPEX as built to suit the claims. First quarter 26 confirms the positive trajectory we described at our full year results 25. The inflation in free cash flow generation is not longer a projection, it's a fact. Moving to slide 17, our liquidity and funding position remains robust. As of the end of the first quarter 26, we have total liquidity of approximately 6 billion euros, comprising 3 billion in cash and further 3 billion in undrawn committed revolving credit facilities. Our 2026 maturities are fully funded, providing complete visibility on near-term refinancing needs. As highlighted, in the first quarter 26, we successfully issued dual serious bonds for 1.5 billion euros, with maturities of 5 and 10 years at a blended pricing of 3.4%. This was a proactive move to anticipate our 2026 refinancing requirements, extend duration and locking attractive pricing in a window of favorable market conditions. The transaction attracted a strong investor demand and further demonstrates the confidence the debt capital markets have in our credit story. Our strategy when issuing bonds allows us to preserve our cost of debt while maintaining ample liquidity buffers. On gross debt composition, our 20.2 billion stack is well diversified. Eurostrade bonds represent circa 12 billion euros. Convertible bonds, circa 3.5 billion. And bank debt, circa 3.5 billion. With Swiss instruments at around 1 billion euros. This reflects the disciplined funding strategy that underpins the free cash flow trajectory we described. Moving to slide 18, I would like to give you a clear picture of where we stand on shareholder remuneration. both what has been executed and what remains ahead in 2025 we returned a total of 1 billion to shareholders comprising 12 million in dividends and 1 billion through our share buyback program that that was a year of strong capital returns in 2026 we have committed to returning a minimum amount of 800 million euros made up of 500 million euros in dividends and 300 million euros in shareback backs. Looking at the execution timeline for the year, the first dividend tranche of 250 million euros was paid in January 26 as committed. By the end of March 26, we had already executed 60 million of the buyback program committed for this year from the 300 million in total. The second dividend range of 250 million euros will be paid in July 2026, on the 15th of July. The remaining 240 million euros of our ongoing buyback program will be executed until the end of the year. We are on track. The program is being executed with discipline and precision. In summary, first quarter 26 was another quarter of a strong organic performance, with healthy drivers of demand across our portfolio. Operational transformation and financial discipline are driving strong margin expansion and free cash flow growth as promised. Our equity story remains intact with our leading industrial platform delivering on its premise of highly predictable and secure revenue growth and consolidating the generation of strong protons and value creation for our shareholders. With that, let me hand over to Maria for the Q&A. Thank you so much.

Okay. Thank you, Jaimón. Thank you, Marco. So, we're now available to take your questions. So, looking at the list, we have Andre from EVS to kick off the questions.

Hi, everyone. Thank you for the presentation, and thank you for the additional materials also that you sent around yesterday. I wanted to touch upon, obviously, France, probably as the first question. So, we now have New Colour from the consortium, given the revised and seemingly final offer, including that WIG is committing to acquire FFR networks in densely populated areas. So, I was just wondering if there is an update on the discussions from your point of view, including any kind of further detail on how you are involved. in possible synergy and remedy talks with your customers, and when do you expect to be able to kind of provide an update to the market after, obviously, the deal completes? And then second question that I had, if I may, just on the tenancy side with respect to the UK, obviously, you know, we're progressing with the Vodafone P network integration, and I was wondering you know, from what if only three competitors who are now at a material disadvantage when it comes to the spike count in the UK, do you see kind of progress in their willingness or plans to bridge that gap and can we expect an acceleration in NMC's based on that going forward and is that a blueprint you think for some of the potential M&A situations? in other countries in the EU.

Thank you. Okay.

So, you should know, André, that you made Vincent, my chief strategy officer, win the bet on the first question, because he bets on France, so he won. On France, the situation is finally becoming way more clear. that this is a net positive. So the consortium entered in an exclusivity period. They are working on what is a full offer that includes not only a term sheet, but includes an SBA and all the terms of the SBA, which is very positive because the transaction is fairly complicated. It's complicated in the execution, so a split of such a size has never been performed before, not only in Europe, it's never been done. It's not obvious from the regulatory standpoint, and it's not obvious in terms of remedies that have to be decided by the regulator in order to approve the data. So, to some extent our MSA is super clear, and this is a big advantage in the discussion we are having with the consortium, because the terms of this MSA are not under question. So the driving principle of the MSA, that any change in the MSA has to be agreed with us, recognized and agreed by everybody. So we want to be cooperative. We've been cooperative in the UK, we've been cooperative in Spain, and we want to be cooperative. There are a lot of ways to be cooperative, and as we said many times, the value that we have to bridge with an NPV neutral negotiation is not that big. which again is a big advantage because more or less we all agree on what can be the numbers we are talking about. Now, timing for sitting at the table. Until when the parts of the consortium, the buy side and the sell side have not agreed, there is no matter of discussion. So we stay in Barcelona and we wait for receiving a call. which is not true that it means that we're doing nothing. So we are working with CTOs in order to understand where are the overlaps, where we can be useful, what we assume can be the logic of an agreement. But as of today, talking about having a negotiation, there is no negotiation because there is nothing on the table. So, we agree that we stay in contact, we stay very much in contact with the buy side. By the way, we are not blocking the operations with SFR, because, for example, we continue to make network developments in the cross-zone zone, which is something that has been agreed by SFR and by GWIG, because life goes on, and so we continue to operate, which is the reason why you see that our growth in France is okay. And it's, again, it's an indirect indicator that the relation among the parties is okay, because otherwise, you know, if you start having problems, you don't work nicely on other areas. As we told you, we will inform if there are progressives. I think that if something moves, we will be proactive in letting you know. It's very interesting. So UK, there is a lot going on, because what is happening is that Vodafone is, with one hand, is optimizing the integration of the two networks, and with the other hand they have to start working on the on the remedies that they received from cma so they have to make this double double job of becoming more efficient and and increasing their presence and this starts to put some pressure on on on other operators so allow me not to answer too much in the details but we see the other operators starting making their own analysis on how they can commercially respond or better technologically respond to the natural performance increase that Vodafone 3 is start to have. Again, work in progress and keep you posted. Thank you, Marco.

The next question comes from Roshan Rashid from Deutsche Bank. Go ahead, Roshan.

Great evening, everyone. Thank you for the questions. I've got two, please. Firstly, on the co-location trend, and thanks for the details as always. I appreciate there is seasonality through the year. Coming off the strong 400 gross co-location number in Spain last quarter, could you perhaps provide us with a bit of colour around the trends for the co-locations through the year, particularly in Spain, given that the MergeCo is now fully focused on its reconfiguration post the kind of network rationalization. So how can we expect that to, I guess, pick up through the air and when should that accelerate? And secondly, and maybe just touching on the previous question, thanks for the detail, Marco, you mentioned that there are no negotiations currently on the table from your side, I guess. Based on what the consortium have said, now they're in this exclusivity period and we are waiting on this, mou which should present some kind of details around the synergies so based on what you said around the msas and your strength of the msa should we think that there could be or should be limited synergies or savings from any kind of mobile network overlap or rationalization uh in france as part of this deal thank you okay i take uh i take france and i leave a co-location to to raymond okay

So, France, the short answer is that I don't think so. I don't think that having a limited number of overlaps means that the synergies are small. Synergies are also coming from improving the quality of the network using assets that already exist. So the fact that they start relocating SFR sites in order to cover needs of network improvement that the three of them will have, if you want, is somehow a way to make synergies, because alternatively, if the deal didn't happen, they had to make huge capets. Decommissioning is always good, not necessarily because you save on towers, but you save on antennae, you save on energy, you save on maintenance, you save on several aspects. And as we did in uh in spain sometime the good way to to work is to decouple what you can do operationally that from what will be the financial impact on uh on the operation so it's not necessarily true that if you decommission a thousand antenna you should have a discount of 1,000 times the price of one antenna. So, you can negotiate with the clients in several ways, which is, I think, a proactive way, an intelligent way to be positively a part of these efficiency games. So, we want to help our clients to make the efficiency happen. So, Please, don't think that we are against. We are strongly in favor of what is going on. We think that three operators will invest way more than what the four operators were doing on a standalone basis. So, we are strongly in favor. We will do everything we can in order to allow our clients to be successful in this.

So, So on the Spanish collocation, just to highlight first, maybe let's try to remember how collocation was last year in Spain. If you recall, and we were always showing the graph of Spain on a quarterly basis, last year on the first quarter, 25, we had a churn coming from the Mazaran's transaction that was already planned with them. that we managed to then recover between the second but third quarter and mainly fourth quarter thanks to the entrance of DG in terms of land sharing. And that's what brought the big increase at the end of the year. This year, we're expecting a more normalized situation in Spain in the sense that we keep on deploying the rural 5G with some built-to-suit. You have seen that this quarter we have something like 30 built-to-suits. We believe it's going to continue in this trend, probably increasing a bit in the second half of the year. And from the collocation perspective, we believe it's going to be more or less recurrent, the same collocation we're having now on the upcoming quarters, with not big differences. So we do not expect to have this big peak at the end of the year coming from the VG trend sharing.

Thank you very much. Thank you.

So the next question comes from Akhil Dasani. Jason Morgan, go ahead, Akhil.

Hi, good afternoon. Thanks for taking the questions. I've got two as well, please, if I can. The first one was just on disposals. Marco, you talked about the two recent transactions that you've closed. But I'm sure you've seen there's been speculation in regards to you potentially having restarted the Swiss sell process. So I'd love to understand whether there's any credibility to these rumours, if there are, what's initiated that change, and what you can tell us around, you know, conversation, what's going on. So that's the first one. And then the second one, just to go back to France, but maybe address the question in a slightly different way. You mentioned that so far there's been decent conversation, and I guess you're keen to work in a collaborative way with your partners. I guess you're probably also aware from the sidelines that we've seen a surprising shift in Italy after consolidation there in regards to what's happening in Inuit. So I'd love to understand as you look at it from the outside in, what you're thinking around the situation in a way, how you would compare and contrast that with your situation in France just to give the market comfort that that's very different and not something we should be looking at too closely. Thanks a lot.

Good. Ciao, Akhil. Happy to hear you. So I'm sorry, on the first point on Switzerland, as you said, we are talking about press rumors and the house habit is not to discuss about press rumors. So I'm sorry not to give you more color. We always said that if there is the price, we do a deal. If there is not the price, we don't. That's it. Very simple. So I would like really to elaborate on your second question because it's very intriguing. I spent last week three days in Rome just to meet government, to meet the regulator, to meet our client and to spend time understanding closely what's happening. My Strong conviction is that we are talking about a commercial disagreement. So, the parties of a commercial agreement have a strong disagreement of the terms of their contract. That's it. There is no signal, any signal, that there is any regulatory or whatsoever backdrop in this. which seems to me absolute logic. So it is what it should be. And I spoke with my client very intensely. We have our renewal in 2030, so it's not something that is beyond the corner. And let me say that we are talking very constructively on what we should do together because of The main point in Italy of my client is to understand about spectrum renewal, what is going to be the investment coming with the spectrum renewal, how to improve the permitting, how to improve the operations, blah, blah, blah, and a lot of work to do. I would say that the Italian case, the more I see the Italian case, the more it seems to me a commercial dispute. I'm very sorry to see that a commercial dispute can end in a court, but ultimately I think that the rule of law is the rule of law, and it's important not only for Inuit, I would say also for Italy, to show that In a large country, the rule of law has to be respected. That's it. There is a simple sense. I'm sorry I'm not very much in the details of this dispute because I'm the competitor. I cannot tell you more than this. So, is it possible that it creates a pandemic effect on France? look into the interest of the party, I would make it short and say no. So I don't see any signal that tells me that this can flow into the French situation. So make it short, no. Great, thank you. Thank you, Akhil.

Okay, so now moving on to the next question from Rohit Modi at Citibank.

Hi, thank you for the opportunity. Some of my questions have already been answered. Just two questions. Firstly, sorry, back on France, as the operator recently mentioned, there's a change in structure of the deal now from asset deal to shares deal, which means the entity has been transferred, will be transferred from altis to consortium does that change anything from sell next position in terms of the change of control beforehand before there's a split of asset so just trying to understand from the next perspective is there any change that you see that you see and secondly uh you touched upon uh wintry and some there is the clause uh on the wintry contract which has explicitly mentioned that you know there could be a price renegotiation that can happen between minus 15 to plus five percent

given you're already in discussion like if you can give any color on where do you see that that ends by 2030 thank you okay a share deal is mildly better is almost the same is mildly better for us in a share deal in an asset deal basically you have to decide before where the asset go and which assets are treated in which way, which makes the preliminary work way more complicated. In a share deal, you transfer the shares, and you have more time to work on how to reallocate the assets among the members of the consortium. which makes it mildly better procedurally, I would say. From the legal perspective, it doesn't change absolutely nothing. So, our contracts are the same, but if you want to split, you need our consent. So, if you transfer the shares, you can make it. There is a change of control issue, but there is no a problem of splitting the contract, so it's mildly easier for us to deal with a share deal than with an asset deal, but not such a big difference. So the second question was, you were referring to the Win 3 contract, correct?

Yes, exactly, the renewal on the Win 3 contract.

Okay. The renewal is due in 2030. So we are not in a hurry, not on my side and not on Benoit Hansen's side. So we have time. The contract is pretty clear because there is a corridor in which the new price is going to be set. As always, when you make a corridor, you take the midpoint of the corridor and it becomes a reference point. But... what I can tell you. It's a bit early to discuss something that should happen in 2030. From the regulatory perspective, it's absolutely neutral. It's a renewal. It's an all-or-nothing renewal that has no discussion from the client, no discussion from our side. What is very much important for us is that we serve with the with the maximum quality, which seems to be the case, so happy for my Italian team.

Thank you.

Thank you.

Okay, so moving on, the next question comes from Avelas at BNP.

Hi, good evening, everyone, and thanks for taking my question. Of the two equipment states, Firstly, just on the co-locations and one of your smaller markets, which was mentioned, I mean, this is historically been a market with sort of relatively limited co-location growth. And then you, I think, previously characterized this as a sort of low growth market. So just wondering what drove the stronger growth in pops in Q1, co-location pops, and if that is something that we should expect to continue. And then secondly, just coming back to your point on the U.K., Just a point of clarification, I suppose. If there are more BTS opportunities, is that something that Celnex would be able to pursue, or is there a market share limitation on Celnex's ability to grow more sites in the UK?

Thank you. Okay. I take the second first, and then I leave to Raymond for the collocation. So, on BTS, no, we have no limitation in order to participate eventually to a BTS program. Then, of course, we have to better understand what are the terms, what is going to be the process, etc. But, no, technically speaking, we have no particular limitation. So if there is some of our clients who want to go in this direction, we for sure, we're going to be happy to participate. UK is a market where we would like to invest more. It's a very good market, solid market. And I think that the market repair will make it way better than before. So, Raimon, please.

In the second question, just to make sure that I understood, I'm not sure if you were talking just about Switzerland or if you were talking about all the countries. Yeah, that was on Switzerland, Raimon, thank you.

Okay.

So, Switzerland, we have had a good first quarter in terms of collocation, mainly a lot of pubs coming from IoT. I would say, probably, we don't need to expect that significant growth in the next quarters. I would say that the next quarter is going to be more in line with what we have had in the past in Switzerland, that there is a bit of a smaller growth in the co-locations, but it remains the deal-to-suit program that we have that will continue in the next quarters.

That's great. Thank you. Thank you.

Okay. Now moving on to James Ratzer at New Streets.

Yes, thank you very much indeed. So I have two questions as well. The first one was about thinking about the kind of impact of satellite on your business, because what we've seen recently is people like Amazon, Leo, Starlink start to sign some tower backhaul agreements with MNOs. So I was kind of wondering whether is that something you would be open to offering on your towers? And I'm kind of wondering how could that affect your business? I mean, could that actually be additional upside for Salmex because you would then start to get an additional tenant on the tower in the form of a Starlink or an Amazon Leo dish? And then the second question I had was just on your broadcast business in Spain. So you're indicating that that growth is going to re-accelerate back to inflationary levels from Q2. Could you run us through what the details of the contract renegotiation you did last year are? there was. How secure is that revenue stream until the kind of next renegotiation? Should that just grow in line with inflation until then? Thank you.

Cool, yeah. On satellite, more than additional revenues from backhauling, which is always possible. We don't see in our countries these happening a lot. But we still have some radio links, so backhauling made using high-capacity radio links. So should it be substituted with satellite links? It's not impossible. It always depends on several conditions. not only price, but especially performance. Now, the price of a radio link and the price of a satellite link for backhauling is not very different. So, not very big for the time being. What we see is LEO Constellation looking for ground stations. So, a ground station for... uh for the the the leo constellation is pretty different from the old ones so the old ones were very big dishes because the the satellite was in an orbit approximately seven to eight hundred kilometers these uh in an orbit which is 450 to 500 kilometers so the kind of a dish used for the dialogue with satellite is completely different, the configuration is different, the density is different, etc. So, we are talking about areas relatively bigger than what we're used to do with a normal tower. We're talking about sort of 2,000 to 3,000 square meters. of land, multi-antenna with land control for land control and data transmission. You need a very demanding requirement for energy, for connectivity. So we're talking about a very, very, very high demand of energy. So we assume that in europe every constellation should have a sort of 40 to 50 ground station uh at least the the big ones uh utensils uses a totally different technology so we should not refer to you to start referring to to the to the leo uh so this is uh this is uh basically uh what we're going uh and of course it's priced consistently. We don't price the same as a normal tower. This is a big animal. We have an agreement with one constellation. There are some several elements that are under NDA, so I stop here before I say something too much. My CEO is looking to me very badly, so I stop here.

On the broadcasting, James, just to give you idea we have renewed five years contract with the non-public broadcasters it's through that in june 25 license says we were renewed for a longer period it was 15 years and contracts are cpi based so it's very simple thank you on the if you have trust mark on the first have you got many towers where you have two to three thousand square meters of land spared just adjacent to the tower

No, they don't want to be in the same piece of land as the tower, because the access, the perimeter access to this piece of land has to be very strictly monitored. And so we have to avoid the interferences, radio interferences, electromagnetic interferences, So it's, no, no, no. It's a totally isolated piece of land. Happy to do. We already did two. So this I can say. We made now three. So Simone is correct. We made three. And we have a pipeline now doing some more.

Okay, thank you.

You're very welcome.

Thanks, James. Moving on. So we've now got Nick Lyle from Barenburg. Go ahead, Nick.

Hi, thanks very much. I hope you can hear me. It was a couple of questions. Just coming back to the UK, you mentioned it's a solid market, way better than before on your expectations. Could you help us on how that growth in the UK might be split between Vodafone 3 and the remedies? Are the remedies enough to keep the Vodafone 3 revenue positive and growing and raising it? Or are you reliant on the other operators coming in for the UK to grow? Could you just tell us how the consolidation affects it? And then secondly, on the contract renewals, there's been a lot of talk of the operators' balance sheets getting stronger, they're going to get more aggressive because of this, you know, all linked with the INWIP situation. So how are you finding the operators' approach to pricing as they renew contracts? Is there any sense the operators want more aggressive cuts to prices at renewals and things as they were before? Thank you.

Okay, good.

So, on UK, I would say that it's very different the job that Vodafone 3 is doing from what the other operators are doing. Vodafone 3 has two hot potatoes in the hands. One is you have to take two networks and you have to integrate and make one and to understand every time you have a duplication, what is the better alternative forward-looking? And I underline well forward-looking, because what we see is that operators, before dismantling something in urban areas, they think it three times, not only one time, because then the process of building in those urban areas is not improving in terms of permitting it, in terms of time to market, etc., so has a dual need. They have the need of making the two networks being integrated, and then they have to expand their coverage. And in the coverage expansion, they have to consider that they have a portion of the country in which they are run sharing with VMO2, which adds another element of complexity, because in their part of the beacon run sharing, they can do basically what they want. In the other part of the run sharing, they have to sit and discuss and agree with BM2. So this is Vodafone. We are working a lot with Vodafone because, as you know, the network of Hutchinson 3 UK was heavily relying on us. And so we're working with Vodafone 3 in order to design for them the best possible combination. And what is important is that we've been able to give them a good quantity of flexibility without impacting our revenues, which has been possible. Now, the conversation with everything, everywhere, and with the M02 is totally different. So they have their network, and they have to decide to make their decision how to expand their network. EE is totally hands-free, and VM2 has the topic of beacon and to understand what they do in beacon. So it's an interesting puzzle. It's fairly complex, but we are at the table with the three of them. and it's going to be very interesting. On the operation approach, you're making a point that I think it's the big misunderstanding of the contract renewals, okay? So, when an anchor contract is signed, in the anchor contract, there is a component which is clearly a financial component. So, this financial component is designed over a long period, over a 20-year timeframe. So, you cannot come after 10 years and say, you know, my balance sheet now is okay, I want to renegotiate the price. So, think about real estate. So, a part of what you're paying is a mortgage, because this is what they did over a 20-year period. Can you go after 10 years and say, I'm sorry, I want to rediscuss this other, my balance sheet is better. Now, I think that the fact that the balance sheet is better is very relevant. It's very relevant because the new built-to-suits are going to be designed possibly with a lower component, with a lower financial component, with a higher industrial component, which is super good. We are 100% okay with this. But, sorry, you cannot come and say that the old contracts have to be renewed because you feel better. I'm happy for you that you feel better.

Also, Nick, we have added into the frequently asked questions part two documents. One where you can see all the due dates of renewals of our contracts, being the first one in 2030 and then after 2033 going forward. And we have added as well the record of the contract renewals we have had so far. And in all of them, we have managed to find a way forward that is good for the MLO, that is good for us, and we have managed to close with very good results.

That's great. Thank you very much, guys.

Thank you.

Thanks. Okay, moving on to Andrew at Goldman Sachs.

Hi, good evening, everyone. So I just, it's two basically follow-up questions. One, just following on from Akhil's question on Switzerland, I wonder if I could just ask maybe more a hypothetical question around potential deals, but more about the interest levels of private investors in Towers. So, you know, a year, two years ago, we saw private investors swarming around Towers with a low cost of capital and prepared to pay a premium. And then for the last year and a half, we haven't really seen anything apart from a pretty low multiple deal in France. Are you seeing a return of interest of private investors or any kind of return of interest of private investors into the space given credit backdrops, et cetera, and any sense of the cost of capital having shifted on that front? Just trying to get a sense of Is there a bid out there outside of public investors who are obviously weighed down by several structural concerns at the moment? And then secondly, one of the things that I guess people are trying to get to the bottom of around the UK and Spain is when will we see evidence that post consolidation there's an acceleration in investment in networks and densification rather than what's going on now, I think in the past, I think you suggested that we might start to see that demarcation evidence in 2027. What are you seeing right now that's giving you optimism that we'll start to see that exploration investment? And if you've got any sense of timeline, that would be helpful. Thank you.

Yes. Yes. I answer to your question saying that at least there is more optimism in the U.S. So if I take what is happening around SBA, vertical bridge, et cetera, it seems to me that at least some better sense of humor is there. So there is more. I think that some of the big headwinds, I don't know. I think my personal view, they've been overpriced in our share price, and I would say in our sector. I mean, there are headwinds. Yeah, possibly, yes. It has been fairly priced. I think it has been overpriced, because when you see the risk premium that a sector like the Towers is now facing, I think it's a bit too high. So with the lower risk premium, we should be in a different territory with our shares. And this possibly explains why, starting from the U.S., where there are bigger pots of capital, possibly it started from there. Sorry, it's an indirect answer. On UK-Spain, my day scale remains 2027, not because I'm not working. Believe me that my team is working every single day in order to let it happen before. But if you ask me a realistic vision, A realistic vision is that I prefer to keep it as a 2027 event with a potential good surprise if it happens before. But it remains for me a 2027 acceleration. Okay. Thank you very much.

Thank you.

Okay. So now David Wright from Bank of America. David, go ahead.

Hello, guys. Hopefully you can hear me. I'll make it nice and brief. I guess it's kind of an opposite to James's question about satellite coverage. Marco, do you think generally, I mean, we're seeing standalone 5G roll out across Europe now, but do you think there is really an indoor solution in place right now for the industry? It seems to have been very under-indexed in conversations, certainly with the investor community. Do you think the European telcos have a sufficient indoor coverage solution under standalone 5G? Or do you think that could be another wave of potential revenue acceleration for the towers? Thank you.

I think that in general terms, Europe is under-invested in 5G, so not only indoor. Take a car, make a road trip in several countries, UK, France, Germany, and you discover how many times you are without 5G. So indoor is for sure an issue. But it's not only the indoor. So I think that there's people tasked to consider good 5G coverage as something absolutely needed. So you see that at least it happens to me. I'm always annoyed when I'm traveling by train between Barcelona and Madrid and my phone is not working properly. So this is why, by the way, we decided to make the so-called vertical solution business unit. Because you need specialization, you need capital, you need know-how, you need a lot of things. So, short. 5G is not enough. Macro and micro. On macro, I think that the investment is so big that operators need to have some I would say some tailwind that can come from spectrum renewals, it can come from in-market consolidation, it can come just from price uplift, we start seeing some price uplift. Please consider that the GSMA, not Marco, the GSMA said that they think that Europe should make not less than 100 billion euro of 5g investments in the coming five to seven years so this is a big number and and second what we call special coverage special coverage which includes indoor includes transportation routes it it includes mega concentration places like football stadium marina railway station airports etc We have to work on all of these, and there was a lot of work coming and a lot of work for my John Luca, the head of Vertica Solutions.

Yeah, super interesting. Nice to hear from you. Thank you.

Thank you very much.

Okay, so now it's time for the last question. So, Fernando Cordero from Santander. Go ahead, Fernando.

Hello. Thank you for taking my question. It is related with land investments. I would like just to understand for how long do you expect the current 200 million euros, 250 million euros per year general grant rate could be, let's say, the standard. And in that sense also, if you are seeing any kind of pressure on the returns on land acquisition, will you continue to have competitive returns in that product? Thank you.

Thank you. Very good question, especially the second part. So how long do I expect? As of today, the percentage of our land long-term ownership, call it property, call it long-term prepayment, is still relatively low. So we are in a sort of... 15% at the end of the year. Maybe less. So let's say possibly something between 13% and 15% at the end of the year. If you ask me what is a reasonable target, it's not going to be 50%. It's going to be way less. So if we say... 25 to 25 to 30 it's reasonable so what we are missing is another 12 13 percent so make uh make the math and you see that the number the number is remains pretty material but if you want to see The other way around, the opportunity for saving is material, massive, etc. So the increase in EBITDA after these margins can be still good for several years in a row. Now, the second part of your question is very interesting because I would say that the so-called hostile land aggregators, which are guys who have a a pretty predatory attitude of buying the land in order to have unfair profit from this acquisition is reducing. What is there is there are land aggregators, which are doing their job. So they have cheap capital, cheap financing, they go in the market, they know that we are a good client, we are good risk, So, at the end, they can invest because we are a good payer. Our strategy is not to enter in a match race in which we pay any number. We don't pay any number. So, if a deal is convenient, we make the deal. If the deal is not convenient, We sit and we discuss. By the way, we are entering very good agreements with some land aggregators. Why? Exactly because we are a good payer. And so sometimes they like to have big portfolio of land where we are the tenant. We negotiate good price for 10 years, 20 years, 15 years. And we sign good agreements. So to make a long story short, As of today, our return remains very good. Very good means levered return after tax is way double-digit. It's not double-digit. It's way double-digit. Okay? So, good. Cool. Until when it's like this, we will continue to be selective and to use our capital. If the condition materially changes, We will review the logic, but we are pretty strict in the capital allocation. Last point, which is important. Our people from our chief operating officer now is putting together two concepts, which is land acquisition and M&O consolidation. So don't buy the land of a tower that the day after tomorrow can be at risk. So if you see that there is a possibility of an overlap of two towers, think well before you buy the land, because if the day after tomorrow this tower doesn't exist any longer, then it's a bit embarrassing to make tomato cultivation. Thanks, Marco. Thank you, Fernando. Thank you. See you soon.

Okay, so I think that's a wrap in terms of questions. Thank you for your attention and if you need any other support, we're always here and look forward to speaking to you next quarter.

Thank you, everyone. Thank you.