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.