Megacable Hldgs Sab Ord

Good morning and welcome to MedCable fourth quarter and full year 2020 earnings conference call. With us this morning from MedCable, we have Mr. Enrique Umane, CEO, Mr. Raimundo Fernandez, Deputy CEO, and Mr. Luis Zeta, CFO. Let me remind you that the information discussed in today's earnings call may include forward-looking statements on the company's future financial performance and prospects, which are subject to risks and uncertainties. Mayor Cable undertakes no obligation to update or revise any forward-looking statement. I will now turn the call over to Mr. Enrique Yumuni, sir. You may begin.

Thank you very much. Good morning, everyone, and thank you for joining us today. Due to a larger subscriber base and a linear cost structure, during the fourth quarter of 2020, Mayor Cable was able to increase its net income at a double-digit rate. despite the challenging environment of the year that was marked by the deep economic slowdown caused by the COVID-19 pandemic and the new government support from small and medium businesses. In this sense, during the quarter, the subscribers to all services in the mass market continued to upwork the upward trend shown through the year, driving a significant annual increase in IAUs, the largest in the last nine periods. Regarding our turn rates, they remain at very healthy levels, decreasing significantly on an annual basis. As Megacablet subscribers seem quite satisfied with both rendered service and first consequently, we mean to follow a close monitoring of these metrics in order to swiftly adapt our operations to the customer needs. The force behind the financial positive results lies in the ongoing efforts to achieve a more efficient operation as reflected in the yearly EBITDA growth rate higher than the revenue growth. Giving more visibility on the progress of our strategic project, this week we celebrated the launching of XView+, our new generation platform for video on demand and linear TV with an interface able to reproduce all the content of the most popular over-the-top platforms without the need of switching between apps. This means that our customers are able to access all the content of such platforms without ever leaving XViewPlus, using one single search engine, which is ours. It is important to note that, although official launching took place a few days ago, The startup was properly made in the fourth quarter with the service rendered to a portion of subscribers. In this sense, we are quite pleased with the favorable user's review, as this proves a good reception for this additional service. An important development to remark is the investment of over $100 million already made in order to build this market differentiator which will foster incremental sales of our service bundles in the coming quarters. Turning to the GPON migration project, as of the end of 2020, we had already transferred more than 100,000 subscribers to the FTTH network, a significant breakthrough that was made possible thanks to the efficient deployment of CAPEX conducted over the last year, which is already having an impact for some of our subscribers. For 2021, we anticipate moving forward with the migration of subscribers, expecting its conclusion towards year-end. Without any doubt, once completed the full migration, it will represent a significant milestone in our crusade to become the best service provider. With a structured network capable of supporting the highest bandwidths, with one of the best rates of availability and reliability. It is important to note that according to our smart and efficient investment policy, we already have an established plan to carry out the redistribution of the replaced HFC infrastructure, thus also deducing cap-based figures for the coming periods. On the MVNO side, during the fourth quarter, we pursued an aggressive and successful campaign towards product positioning and demand stimulation of this service. Efforts that have yielded results as it comfortably surpassed its target of subscribers set for the year 2020. In this regard, for 2021, we expect to widen the target of MVNO subscribers and we will pursue to offer this service not only for active subscribers, but to the general public as well. Before concluding, although we expect that the further enhancement of the quality of our services by means of moving forward with GPON migration coupled with the launch of XView+, will enable us to maintain this growth momentum during 2021 and beyond. We remain aware of the challenges of the current juncture, so we will continue to closely watch the evolution of main operating metrics. With this, I conclude my remarks. Raymundo, please go on.

Thank you, Enrique. Good morning, everyone. We enter into the fourth quarter with the strong focus of consolidating an iconic year for megacable storage, as we have faced with the health contingency, one of our greatest challenges so far. Support by the fundamentals of our industry, highlighting its resilience and its status as essential for modern times, as well as by our customer-centered service, we were able to continue to increase our subscriber base despite the headwinds. The quarter was characterized by outstanding 7% growth in the mass market segment revenue, support by higher revenues in the three services, While in the corporate, MetroCarrier returns to double-digit growth since the impact of the cancellation of the project Connected Mexico has been left behind. On the Internet side, we were able to further enhance our service penetration in the most prominent markets that we serve, driven by our boosted bandwidth capacity and surging demand for high-speed Internet. These services achieved sequential and annual growths of 2.8% and 13.3%, representing net ads of 96,000 and 413,000, respectively. We expect this positive performance to continue, in line with the increasing demand for internet, confident that our strategic investments will strengthen Megacable's position in this segment of the market. It is important to remind that, since last quarter, Broadband represents our service with the largest number of subs as this surpassed the 3.5 million mark. Turning to video, at year end it recorded over 3.4 million subscribers following the 188,000 net additions registered against the same quarter last year. On a sequential basis, it increased by 51,000 net additions also. Furthermore, XView posted more than 104,000 net ads during the quarter, thus reaching almost 1.2 million subs. It is important to note that, pursuant to our commitment to deliver richer experiences to our subscribers, we remain determined to enhance our offer with additional services, such as our recently launched XView Plus platform. Separately, telephony once again was boosted by our bundle sales approach, reaching 2.6 million subscribers after recording 115,000 net ads on a sequential basis or 496,000 on an annual basis. All in all, the fourth quarter of the year represents our second best reporting period this year, just behind the back-to-school season that was featured by the deployment of comprehensive triple play promotions. Particular outstanding was the performance achieved at the MVNO. As this service outperformed our projections, posting 66,000 quarterly net additions, those surpassing by more than 20,000 subs, the 150,000 target set for its first year of operation, with 174,000 subscribers record as of December 31, 2020. Therefore, we feel quite optimistic with the penetration achieved so far in the MVNO and the positive feedback received from the clients, paving the way to further increase its participation in the revenue mix. On the short rate front, in broadband, we record a 1.6 rate. In video, 1.7%, and the rate corresponding to telephony was 2.1%. These figures prove the effectiveness of our successful customer-centered approach and based in class operation. In line with the information, REUs increased 13% year-over-year to over 9.5 million. Likewise, unique subscriber increased 8.4% on an annual basis, almost reaching the 4 million mark, with an REU per unique subscriber of 2.43 compared to the 2.33 posted as of the end of 2019. Meanwhile, ARPU per unique subscriber slightly decreased 1% to 405 pesos and remained almost flat versus the figure recorded as quiet, as a considerable portion of new subscribers opted for most affordable packages before the prevailing environment of slow economic activity. It is worth noting that this item was also affected by a new way of calculation that excludes the revenue from the mobile services. effective as of this quarter, aiming at improving the transparency in the information for each services. Under the previous model, ARPU per unique subscriber will have been 409 pesos, though recording a sequential improvement. In the breakdown by service, ARPU for the three services remained practically unchanged on a sequential basis, while decreases in ARPU of 2%, 4%, and 5% were recorded for broadband, video, and telephony, respectively, when compared to the fourth quarter of 2019, given the change in the mix previously mentioned. Moving to the corporate telecom segment, MetroCarrer and MCM kept showing the recovery signs observed over the past quarter, as the former continued benefiting from higher demand of services and the reactivation of collections after concluding supporting measures aimed at contingency. MetroCarrera in particular has recovered from the cancellation of an important project and has returned to the growth levels of previous years. We will continue working to maintain and increase these levels, supported by the growth and positioning of the company. On the other hand, in the ongoing implementation of austerity measures and the prevailing approach of Provence for the development of new projects, OLA continued with lower figures compared to 2019. Given service and contracts were not renewed or were canceled, mainly in the government sector. Sorry about that. Towards 2021, we plan to reach more and more customers with high quality and attractive commercial proposals, leverage on our revamped network, and incremental operational efficiency. With this, I conclude my remarks. Now I would like to hand the call over to Luis, who will provide a bigger picture of financial results.

Thank you, Raimundo. Good morning, everyone, and welcome. In line with the higher revenue recorded at all the three mass services, company consolidated revenue for the fourth quarter was up 3% year over year, totaling 5.8 billion pesos. Consolidated revenue for the full year amounted 22.4 billion pesos, a 4% annual increase that follows the same dynamics of the fourth quarter. While on the mass market for the fourth quarter of 2020, broadband grew 11%, video was slightly up 1%, and telephony increased 17%, driving a consolidated growth rate of 7% for this market. as FGUs continued to expand despite the harsh economic environment. For the full year 2020, revenue of the mass segment increased a significant 7% given the 9, 3, and 15% growth rates attained at broadband, video, and telephony, respectively. Corporate telecom recorded a 16% drop in the fourth quarter following a record-hard base of comparison from OLA that was partially upset by the solid numbers recorded in the connectivity segment, especially in Metro Carrier, which once again posted double-digit growth to reach 19%, while MCM hiked 3%. For the full year 2020, revenue of corporate telecom segment decreased 8% versus 2019, attributable to the lower operation level in OLA. as Raimundo mentioned in his remarks, same that could not be offset by the 2% and 5% growth rates posted at Metro Carrier and MCM, respectively. Consequently, in the revenue mix breakdown for both fourth quarter and full year 2020, 83% stemmed from the mass market and 17% from corporate. On the cost and expenses side, Fourth quarter of 2020 cost of services dropped 7% year over year. In the corporate market, the reduction is mainly explained by the normalization of OLAS figures compared to the also record high costs recorded in the last quarter of 2019. Savings were also reflected on SG&A. as the quarterly figure was up only 2% when compared to the fourth quarter of 2019, below the revenue growth. For the full year, cost of services decreased 1% in comparison with 2019, while operating expenses recorded a marginal increase of 1%, also below revenue growth. As a result of higher revenue and an overall decrease in operating costs, The quarterly consolidated EBITDA increased 9% on an annual basis to reach 2.8 billion pesos, while EBITDA for cable operations totaled 2.6 billion, representing an 11% increase. Margin-wise, the consolidated EBITDA margin was 47.9%, up 3 percentage points compared to the fourth quarter of 2019. while that of cable operations stood at 49.4%, posting at 1.2% point expansion. For the full year 2020, consolidated EBITDA totaled 11 billion pesos, a solid growth of 8% versus 2019, with a 49.3 margin, while 2020 EBITDA for cable operations was up 9% year-over-year to reach $10.3 billion, with a 50.8% margin. Thus, fourth quarter net income reported a double-digit growth of 12%, reaching $942 million, benefited by a lower quarterly tax rate and a better comparison than the non-controlling interest that offset the effects of a negative comprehensive financing results, mainly due to the foreign exchange fluctuation. The positive results on the fourth quarter granted Megacablet the required drive to post a 2% growth in net income year-to-year, which reached almost 4.4 billion pesos. Moving into the balance sheet, at the end of 2020, the company net debt amounted 3.6 billion pesos, 1.3 billion pesos below in sequential quarters, a contraction that mostly follows the 74% surge in the cash balance. which was driven by our cash generation. During the fourth quarter, we subscribed a short-term credit for almost 1.2 billion pesos, facing the CAPEX commitment and to overall improve the conditions of our standing financial debt. As a result, both net debt to EBITDA ratio and interest coverage ratio decreased on an annual and sequential basis, standing at healthy levels of 0.32 times and 19.7 times, respectively. In terms of CAPEX, during the quarter, we deployed 3.7 billion pesos. Therefore, investments for the full year 2020 represent 36.1% of 2020 revenues, amounting to 8.1 billion pesos and reaching the target set for 2020. As we continued moving forward at our GPON migration process, that is already generating a positive impact on the service we provide to our customers. At the face of COVID-19 pandemic, we are satisfied with the results obtained for 2020. We anticipate continuing tapping into the solid fundamentals of our business model for the benefit of all our stakeholders. With this, I conclude my remarks. Now let me turn back the call to operator to open the line for Q&A.

At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Our first question is with Alejandro Galastro. with BBVA. Please proceed with your question.

Hi, good morning. Thank you very much for the call. Could you please give us an update on your home deployment strategy? Where are you in terms of the number of homes passed versus your target, number of customers already using FTTH? And this is already explaining the acceleration in internet and voice revenues and the low term rates that we are seeing. And also, what will be the FTTH deployment strategy beyond 2021? What will be your targets and what timeframes? And the second question is about the mobile business. Could you give us an update on the EBITDA margin of this business? And when do you expect to reach even? And how fast do you think you can grow your customer base? And what's your goal? What's your target here? Of the call, in your initial remarks, I believe you said, you mentioned that the Royal ARPU is for 109 pesos. And I was wondering if this is the average ARPU per customer or per subscriber. Thank you.

Hi, Alejandro. This is Raymundo. Thank you for the two or three questions. Let's say that way. Regarding the FTTH, we're very happy with the deployment of the GPOM project that we have. As you are aware, we're deploying that in about 25,000, 26,000 kilometers of our network. We have so far 40% of deployment of the GPOM project. We began to migrate subscribers to the HFC network that we have. You can expect that after 2021, that will be the numbers that we'll have. Around 40% of our network will be JIPON. But the other part, the HFC, as we speak, are beginning the process of increasing, splitting the nodes, and increasing also the kilometers of fiber that we will have in those parts. As we explained before, this project does not only include FTTH in the systems that are going to be full JIPON, But it does include taking fiber to the core closer in every system that is the remaining of the systems of mega cable. So we will have a very good position. Whether beyond 2021, we will go to GPON or not, we don't think so right now. As we said before, our strategies are very aggressive, turning GPON 40% of the network, but being able to split and using the nodes way better than much of the companies or some of the companies even in the United States, where we will address with a home pass of 250 to 500 home pass depending on the size of the market and the social economic levels. That with DOCSIS 3.1 will give us all the bandwidth that we need to support the speeds ask and afford to pay by our subscribers. That also is part of our strategy because it will take our levels of CapEx to a lower level than what we have in 2020 and 2021. As you remain, our strategy was to bring CapEx back to this year, the past year and this one, so we can provide the right network for the future of Mega Keyword. Whether we go G-point, as we said, we don't expect that. And we don't have that in the short term because we believe a good DOCSIS 3.1 platform, full at 250 home paths, as we say, with all the technology included for bandwidth, will provide the right approach to the subscriber at a good proportion of capex over revenue and a healthy balance for the company. So that's related to the FPTH. The other one that you asked was the mobile business. We're very happy. to go over the 150,000 first year mark that we put ourselves as a goal. We're at about 175,000 subs and growing. We believe this year we will continue to grow on a higher speed than what we have, of course, 2020. I will continue to bring revenue to the company, in that case, at a lower margin than what we have since it's not our project. That's understandable. The levels that we were expecting for that one goes around, Luis, you can correct me, but around 20% is what we were forecasting on that one. And we will do the break-even in 2022 pretty much. That's what we expect at the beginning of first semester of 2022. That will be our calculations for that part. And the other one that you asked was related to ARTUS, if I can recall. Can you repeat me, just to remind me, what was the point about the ARTUS?

I think you mentioned a mobile ARPU of 409 pesos. I was just wondering if this is the average ARPU per customer or per subscriber?

209 pesos?

For what service?

For mobile?

Because the global ARPU was 409 pesos. Probably, I didn't hear right. For the mobile, you mean?

No. No, for the unique subscriber, it's 409 pesos.

The ARPU per unique subscriber, what I said is that excluding MVNO that we account different on this first quarter, ARPU wouldn't be 409 pesos. That's what I said. What we are reporting to you is an ARPU of 405 pesos. which is in line a little bit above of what we have on third quarter 20 and slightly below what we have last year. But what I wanted to say is that in order to be more clear about the ARPU of the massive fixed residential or enterprise service, we decide to exclude the MVNO from the unique ARPU calculation. So you will have full transparency of what the ARPU of the fixed network represents and what the mobile contributes to the company. So we wanted to do this one now that we have the 175,000 subscribers, and not when we reach a higher amount, and then it will be more complicated to calculate for you guys what our real ARPU is for fixed. I don't know if that answers your question, Alejandro.

So what's the mobile ARPU then?

Well, the mobile ARPU right now, it doesn't represent a correct number to tell you because we're wrong. Everything that we have, we gave promotions to them. Our ARPU, what we're selling, what we can tell you is that what we're selling is a package of 100 pesos tax included and another package of 200,000 pesos. And it makes it 70-30 pretty much with taxes included. But... Wait a little bit to have the stability of the product. We will begin to report to you ARPU of that mobility. Luis, I don't know if you want to give a word.

Just want to add something, Alejandro. At this point in time, our sales include equipment. And from our perspective, at the beginning, the equipment is going to be part of the ARPU as well. So we don't want a figure to give a figure out that sounds too encouraging. And after the subscribers are no longer acquiring equipment at the same pace, then we will show a decline in the ARPU for the subscribers. So at this point in time, we will not like to show the ARPU. We will start doing that on Q1 figures, so starting in Q1. you will be capable of knowing the numbers, which will be more stable going forward. Yeah, because the numbers we're showing you right now, Alejandro, it has, okay.

Understood, understood, yeah. Thank you, thank you very much. So, Germano, going back to your explanation about the FTTH strategy, you mentioned that you have completed 3% of the deployment, or that's what you plan to achieve by the end of this year?

Sorry, again, the 3% of what deployment, sorry?

You mentioned that you completed 40% of the FTTH deployment already, or this is your goal for the end of this year?

40% is the progress of the 100% of the total GPON implementation, including the migration. So we have completed the design or construction or migrated subscribers. So that's on different phases of the project. And that all add up to 40% of the financials.

Let me see if I can clarify that also, Alejandro. Because you're right, it's confusing 40% of the 40% that we're going to have. We have a 40% progress. in the deployment of the GPOM project. That's pretty much for the finance and what Luis is telling me. At the end, you asked me how does the FTTH will look in megacable. So if you see that we have 63,000 network kilometers as of fourth quarter 2020, and we're going to have around 25,000 to 26,000 kilometers of GPON, that's where I say that we will have a network around 40, a little bit above 40% of our network will be GPON. It will continue to increase because all the green fields, which are the new built areas, are built based on that technology, on GPON. So you will continue to see the increase of GPON, okay, but the project that we have for 2020, 2021 that we announced to you guys will add and summarize 40% of our network as we are speaking right now. I don't know if that makes it clear.

Yes, that's much clearer. Thank you very much, Raimundo. And what will be your targets beyond 2021? Do you want to keep expanding this network or do you want to stay there?

As I said, Alejandro, we don't think so so far because we believe that the network that will remain in the other 59 or 58% with nodes at 250 and 500 in the lower economic levels, but mostly towards the 250s, If you look at what is around the world and mostly in the United States, cable companies have been very successful also providing high bandwidth with that configuration. What we did with GPON proved to be very smart because our rebuild, it was cheaper, it was a good way to invest our money, and also make us save the capex for the other remaining areas while we are able to increase the bandwidth to subscribers. So we don't expect 2022, 2023, 2024 to have a significant increase in GPON. We will always add GPON where it's needed because we're doing greenfields. If we go to new markets and we increase in little towns and areas surrounding the suburban areas of our cities, we will build GPON. So that's our strategy so far. That's what we're planning to do. We're very well managed DOCSIS, and we've proven to manage GPON, so we will continue to have the dual network in our system.

So we have the best value of the HFC network as we approach the FPTH technology.

And let me prove that what I'm saying, Alejandro. When you go from 500 compass to 250 compass, you are not only adding capacity in terms of active electronics on the field, you are also adding a huge amount of fiber. So when we split a node and put more nodes to increase the capacity of our networks, What we're really doing is bringing the fiber closest to the subscriber. So whenever we migrate to a full GPON in the years to come, after passing this next five-year period problem, when we want to do that, our fiber is already prepared to be at the corner of the streets. So we will have to deploy fiber to the company. Also, we have a great advantage in some of the areas. From all our set-top boxes that we're deploying for the video service are hybrid set-top boxes and OTT devices. That means they will be running on the HFC or on the GPON area. That's what they are doing right now. So when we want to migrate to Fujifilm in years to come on selected periods, all we have to do is throw fiber for the last block or two blocks of the street without having to replace various sets of boxes. We will have to replace, of course, the modern that goes on the house. But that's something that we have considered. And as I said, it's a long, long-term project. role for Mega Cable that can tell you that management has the view of what we're going to do, not only in 2021 and 2022, but the years to come.

Great explanation.

Thank you very much. Thanks to you, Alejandro.

Our next question will be from Marcelo Santos with JP Morgan. Please proceed with your question.

Hi, good morning. Thanks for taking my questions. I have two. The first question is regarding the outlook for 2021. Perhaps you could share a bit how much do you expect to grow for the main lines as you usually do by the end of the year? If you could, that would be great. And the second, I wanted to touch a bit upon the margin in the fourth quarter, which was a bit strong. And we see, especially on the cable front, so working more on the cable, we see that SG&A was kind of lower, so if you could discuss a bit more on what causes SG&A to be lower and if that's more sustainable, that would be the second question. Thank you.

Thank you, Marcelo. You want me, Luis, to answer the ARPU and you answer the margin? The outlook? You go for the outlook, I go for the margin. Okay, I'll tell you how you relate it to the ARPU. The outlook. The outlook, yeah. We see a slight increase of the ARPU coming forward. That one is what we can tell you. As we say in 2020, we are still waiting for this pandemic to migrate to a new reality. So we won't give you a straight guidance for this time on that part. We feel that the market It's not the time to give guidance for you, but we can tell you some of the looks, the outlooks that we have. And in that term, the ARPU, in our opinion, is going to slightly increase to what we have right now. Okay. That one coming from once the market is going to have some pressure on the back to work reality before what's back to home. or homework, stay at home. Now it's back to work. We're expecting for the second semester to have some of that effect. But we're also expecting that the XView Plus platform, with the integration of the apps, will bring new sources of revenue to the company on that part. As I said, we're not taking the MVNO as part of the ARPU. That's what we're saying, like ARPU. of the company will increase, I mean revenue of the company will increase because of all the different apps, video, and mobile services that we have. So take into consideration that ARPU is going to slightly increase. That's what we can tell you right now. Luis, you want to go deeper into the margin?

I would like to state that we, as we say in our introductory speech, we launched XView Plus. We did not do that investment. It's a large investment in that technology platform for a few subscribers. That's made to be able to serve over 3 million subscribers. So we expect to install that XView Plus platform to all GPON video subscribers. Because that's made for that. And it's an incredible experience that we are providing the subscribers. So that will help us to enhance our art. And then the back to work or back to school programs in Mexico, you know, it will depend on basically the vaccination campaign or how fast our vaccines advance among the population. We see that in advanced countries like in the US, they expect to have vaccinated 70% of their population, which is the minimum target that you need in order to go back to some kind of normality or back to normal. That's going to be at the end of the summer. It's going to be until 2022, maybe the beginning of middle 2022. So we will be back, but not as fast as other countries. And I think that home office will stay here for a big part of the 2021 year. And back to school is going to be, you know, with some students still at home, some students doing presential learning. And Even though when we finish and we reach the targets for vaccination, the new normal is going to be different. There's going to be a lot being done. There's going to be a lot of use of the broadband and internet. People are now used to doing takeout and order by platform, food and things like that. So this changed definitely and it's a good thing for us in the telecom business. And people are demanding higher speeds and better video service. And a video service that will provide them with the platform, the most popular platforms that are out there in the market, plus the ones to come. This month, Viacom is launching Paramount, which is another video platform. Also, Disney is out, and Netflix, well, it's very popular. So we think that video is something that is... is there present in the mind of subscribers? In broadband, they need higher speeds, and the need of our service is much higher in the priorities of businesses and homes. So that's what we're betting on, and we did prepare for that. Our network has supported all the loads that the subscribers have put on them. And we are getting a better network every month. And even though with the network we have, we have been able to handle all the traffic. So we have a very bright future. Thank you very much.

Luis, the margin? Yeah, on margins, you have to consider You have to consider basically that we expect acceleration growth in the corporate segment. That means that we'll put some pressure on the margin, as well as another thing that is going to be impacting is the growth also on the MVNO. So these two lines will put some pressure on the margin. We expect, though, that the margin will be on the same levels that you see today. And basically, that's what we expect for 2021.

Great. Thank you very much for the answers. Welcome, Marcelo.

As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad. Our next question will be from the web. Please proceed.

OK, we have a question from Ricardo Oviedo from GBM. And it is, with your net debt standing at 0.3 times, do you have a target ratio after which you could increase shareholder return, maybe a special dividend?

OK, we don't have a specific ratio on net debt. It will depend, basically, it's a consequence of the plans and the strategy of the company. And at this point in time, we have no talks with the board regarding a special dividend due to this situation. We know we are generating cash. We will continue generating cash, but that will be to fund, basically, our CapEx for this year. And maybe after that, we will have a conversation. But for the proper time or the current time, we want to be sure that we will have enough cash to face our commitments.

As of today, we feel very comfortable with the net debt position, like Luis was saying, and also with the dividend ratio we have in the past. So, Ricardo, we don't have any reason why to consider changing that right now as of today, like Luis was saying.

Hello, ladies and gentlemen. Welcome back. It looks like we have another question from the web. Please proceed.

Okay. This question comes from . It is, good morning all. Are you watching SpaceX progress with Starlink, and what conditions will you have to be in place before modern satellite broadband could be considered to have effectively overbuilt Mexico?

I would think that we have looked at that and that's a service that goes basically I'm saying that the market that doesn't have any connections, any efficient connections, but there is no partial fiber, basically rural areas or very secluded areas like mountains and out of reach of fiber.

for an efficient broadband wireless connection. There's a market for that, but it's definitely not a substitute for fiber broadband connection.

Thank you. Okay. And also, the SpaceX progress on the project, we will we will be more than happy to provide bandwidth to them because they need to provide bandwidth in order to cover satellite coordination. So we're following them. It's not a competition at all. It is more of a service that is going to complement areas where the thick network that we have doesn't get. But we, in some of our business units, are are more than welcome and compete and follow what they are doing in order to provide the backbone services for the for the program that they need so so we know pretty much about the project and we're very very very happy any more questions okay we have another question is can you please talk about capex for 2021 which areas will be you investing and how many additions

you're expecting from Ex-View Plus?

Sure. As we said before, we're not going to provide a particular guidance because of all the effects of the pandemic and the situation that we have. What we can say is that numbers look good for 2021 still. After the extraordinary growth that we have in 2020, we will continue to provide good numbers in the massive and better numbers in the corporate segment That one you can count on that. And related to CAPEX, we're going to have pressure on the CAPEX. It's something that we announced before and it's in line with the GPOM project and the XView platform that we are providing to our services. As we say, we have 40% of the GPON project already deployed in 2020, so we will have 60% of that project apply in 2021. So that pretty much can tell you that we're going to have a capex slightly above of what we have in 2020. That one we can tell you. There is no surprise on that. But we'll strain the presence and the strain of megacable for the future, you know. For the XView, as we say, XView is part of the migration from HFC to GPON. So subscribers will be able to access the platform and we will continue to increase subscribers that acquire the service. It's a very complex question because it does include also the access to the apps and that one. So as I said, we would like to leave it right now that you will have an increase in ARPU for 2021, a slight increase in ARPU. That's what we would like to send the message. And those ones will continue to bring great numbers for the company.

Okay. Another question.

No, that's it. We'll be turning the call back to the operator. Operator?

Okay, this concludes tonight's conference. You may disconnect your lines at this time. Thank you for your participation.

Okay, yes. Sorry. Before we say, it was a pleasure to discuss our results with you, with all of you, and thank you for your attendance. Please contact our Investor Relations Department if you have any questions or concerns regarding the company. And have a wonderful day and an even better week.

And also, we would like to apologize for the disconnection, momentarily disconnection. We will find out. This is the 13th year that we do this. It's the first time we have this connection, so we will find what happened and apologize for that. I think the important part is the great numbers that we're providing to you. It was a good fourth quarter, and it's going to be a great 2021. We thank you for the support and follow-up of the company, and we will fix that communication problem. Thank you very much.

You may disconnect your lines at this time. Thank you for your participation.