Koninklijke Kpn Nv

Good day, ladies and gentlemen, and welcome to KPN's third quarter earnings webcast and conference call. Please note that this event is being recorded. At this time, all participants are in listen-only mode. We will be facilitating a question and answer session towards the end of today's prepared remarks. If you would like to ask a question, you may do so by pressing star 1 on your telephone. I will now turn the call over to your host for today, Matthijs von Lionhorst, Head of Investor Relations. Please go ahead.

Yes, good afternoon, ladies and gentlemen. Thank you for joining us today. Welcome to KPN's third quarter 2024 results webcast. With me today are Joost Farwerk, our CEO, and Kistie Ge, our CFO. As usual, before turning to our presentation, I would like to remind you of the safe harbor on page two of the slides, which also applies to any statements made during this presentation. In particular, today's presentation may include forward-looking statements, including KPM's expectations with respect to its outlook and ambitions, which were also included in a press release published this morning. All such statements are subject to the safe harbor. Let me now hand over to our CEO, Joost Farberg.

Thank you, Matthijs, and welcome everyone. Let me walk you through some of the highlights of last quarter. We continue to deliver solid results with our connect, activate, and grow strategy. Group service revenues increased 3.4% on an organic basis in the third quarter, with growth visible across all segments. Consumer was driven by another quarter of solid post-paid inflow and continued fiber revenue growth. Business continued to perform strongly, with all segments contributing and, as expected, wholesale return to growth when adjusted for EUFON. We delivered healthy EBITDA growth, and our year-to-date free cash flow was broadly stable compared to last year. And together with our joint venture, Glassport, we further increased our fiber footprint, and we now cover 62% of the Netherlands with our best-in-class network. Finally, we are confident to deliver on our full-year 2024 outlook and midterm ambitions. As a reminder, our Connect, Activate, and Grow strategy is supported by three key pillars. One, we continue to invest in our leading networks. Two, we continue to grow and protect our customer base. And three, we further modernize and simplify our operating model. And together, these strategic priorities support our ambition to grow our service revenue and adjusted EBITDA by 3% and our free cash flow by 7% per annum on average in the coming years for Simply Put, our 337 framework. Let me now walk you through the business details. Together with Glossport, our joint venture, we added 137 fiber households to our fiber footprint. By the end of the year, we expect to cover 64% of Dutch households, and we are making good progress to reach our target of roughly 80% by the end of 2026. And after reaching that point, we foresee a material step down in our capex, dropping to below 1 billion. Within the fiber footprint, we focus on connecting households and activating customers, which is delivering good results with almost two-thirds of our retail base on fiber and strong fiber service revenue growth. Let's now have a further look at the consumer segments. Consumer service revenues continue to grow, driven by consistent fiber and mobile service revenue growth. Customer satisfaction net promoter score is a priority, and leading in the Dutch markets. We have witnessed some adverse movements recently, which have our full attention, because we aim to grow Net Promoters Forum. Now let's take a deeper look into our third quarter KPIs. We saw another quarter of broadband-based growth, despite the elevated churn in our copper base. We're able to maintain a constant healthy inflow of new fiber customers. And this, combined with a broadly stable RQ, led to continued growth of our fixed service revenues. We continue to see solid trends in mobile. Our post-state base increased by 45,000 subscribers, driven by the ongoing success of Unlimited and a successful launch of our new kids and teens proposition in early September. Our post-state RQ was broadly stable, and combined, this led to a 6.7% service revenue growth. Now let's move to B2B. B2B delivered a strong quarter with solid growth across the board. Also for business, the net promoter score remains leading, and we aim for higher than last year and last quarter. So recently also we saw some pressure here on the net promoter score, and this is our full attention. SME is currently the main growth engine of B2B, driven by solid performance in both mobile and broadband, and cross-sell to ICD services on the KPN1 platform. LCE continues to move in the right direction, has now reported growth for four quarters in a row. The service revenue trend is much better than seen in previous quarters. That's driven by IoT, higher roaming-related revenues, but also because last year included the small negative incidental. And as a result, we do not expect this growth trend to continue in the next quarter. Nonetheless, we are on a pretty good track here. And lastly, Taylor Solutions continues to deliver its plans. The growth in the third quarter was partly due to higher project revenues And this business remains subject to timing. The performance is moving to a more profitable level. So that's good. Wholesale. Our wholesale service revenues have sustainably reflected when adjusted for Uphone, driven by both broadband and mobile. Broadband service revenues were supported by higher fiber service revenues. And as expected, KPN's broadband base declined by 9,000, driven by the continued competitive environment seen in the wider broadband market and the ongoing migration of our proper customers to fiber and glassboard areas. In Molen, service revenues growth was driven by a significant increase in international sponsored roaming, As many MVNOs leverage KPN's existing roaming partnerships to offer seamless international roaming services to their subscribers. Other service revenues declined in wholesale, mainly driven by the lower regulated tariffs and less traffic, leading to a decrease in low-margin interconnect revenues. Now, let me hand over to Chris to give you more details on our financials.