Megacable Holdings

Good morning. Welcome to Merakable's first quarter 2016 earnings conference call. With us this morning, we have Mr. Enrique Yamuni, CEO, Mr. Raimundo Fernandez, Deputy CEO, and Mr. Luis Eter, CFO. Let me remind you that the information discussed at today's earnings call may include forward-looking statements on the company's future financial performance and prospects, which are subject to risk and uncertainties. Merakable undertakes no obligation to update or revise any forward-looking statements. I will now turn the call over to Mr. Enrique Yamuni. Sir, you may begin.

Thank you, Saúl. Good morning, everyone, and thank you for joining us today. With a solid beginning of the year, we are pleased to announce the results of the first quarter of 2026, which came in line with our expectations once again, evidencing the resilience of our operations and the strength of our market positions. These results reflect outstanding performance in an economic environment that presented diverse challenges at the outset of the year, marked by our sympathy around trade policy, among other factors reaffirming our ability to create value. In this context, we managed to present a period with continuous subscriber growth, consolidating our presence in the new territories and maintaining subscriber levels in legacy territories. Outstanding mass market revenue increase, including ARPU, expansion, accelerated net profit growth, and a stationary traffic decrease supporting a higher cash generation. Operationally, broadband remains the main driver of business growth. Net additions of Internet subscribers remain within the quarterly range that we have been discussing in recent periods, and we expect it we expect to increase the pace in the next quarters as a result of better service and a very competitive commercial offer. At the same time, we continue to strengthen our network. We have evolved into a predominantly fiber-based company, and the few areas that still rely on legacy infrastructure would continue to migrate over time. This advancement reflects our approach to competition, capitalizing on the quality and capabilities of our network beyond just pricing. We are convinced that our infrastructure will continue to be one of the main sources of differentiations and sustainable value creation for megacoupling. In terms of financial results, our consolidated revenues and EBITDA continue to grow at a single high digits. while the quarterly figure for net profit recorded one of its best performances in the last two years. Moreover, our balance sheet remains strong with a decreasing leverage ratio. That implies that Mega has a privileged position to take on investment opportunities that might arise. Regarding CapEx, it is worth noting that CapEx for the first half of the year is typically lower as a percentage of revenues. This quarter capped capex as a percentage of revenues reached one of the lowest levels since the launch of our expansion and evolution project. Despite pressure streaming from geopolitical situations and the related price increase in some inputs, We successfully offset these challenges to greater efficiency in the execution of our investment in a strategy focused on a more selective CAPEX deployment in the expansion territories. As a result of the above, we can expect 20,026 full-year CAPEX to be around 24 to 27% of revenues for 2026. We have demonstrated that our growth trajectory is advancing according to the five-year plan that we set and that we have successfully transitioned from a phase of intensive investment and growth to a phase of returns. Our efforts continue unchanged. It is clear that the next phase will be marked by pursuing operational efficiency, consolidation, and digitalization. Also, Advances in artificial intelligence and digitalization are a core pillar of Agar-Carles innovation. Under our MAKEN concept, we are achieving efficiencies that will, with no doubt, yield significant results in the coming quarters. These processes will make us more competitive in the market and open up new areas of opportunity. Before concluding, following the resolution approved yesterday at the shareholders' meeting, the company will distribute a dividend of 3.2 billion pesos. This reflects our confidence in Mayor Kavli's cash generation capacity and our commitment to delivering value to our shareholders. We expect this distribution to represent one of the highest dividend yields in the market in line with previous periods. In summary, the first quarter was consistent with the seasonal trends we usually see at the beginning of the year. Although we faced some challenges, none have altered our confidence in the business outlook. We remain focused on execution, capital discipline, and strengthening Megacal's competitive positions in the Mexican telecom market, reinforcing our role as a key industry player with an evolving infrastructure that supports a more connected, sustainable and innovative future that with that, let me turn the call over to Raimundo for the operational review. Raimundo, please go ahead.

Thanks Enrique and good morning everyone. As Enrique mentioned, the first quarter developed broadly in line with the seasonal trends we usually see at the beginning of the year. In that context, Operating trends remained sound, and commercial execution continued to support growth across the business. Starting with network development, our footprint reached 19.5 million home paths at the end of the quarter, up 11% year-over-year, while our network extended to approximately 110,000 kilometers, an increase of 7%. These figures reflect the scale we have built and, more importantly, the platform we now have to continue monetizing recent investments. Fiber migration also continues to advance, with approximately 86% of our subscriber base served through fiber technology at quarter end, compared to 77% in the same period last year. we have already reached a level of operational and commercial maturity comparable to that of pure plate fiber operators. Connect to subscriber trends. Internet subscribers reached 5.9 million at quarter end, up 9% year-over-year, equivalent to 495,000 net additions over the last 12 months. Sequentially, we added 101,000 subscribers, consisting with the range we have communicated in previous quarters. Telephony subscribers reached 5.2 million, increasing 7% year-over-year, or 353,000 net additions over the last 12 months. During the quarter, net additions totaled almost 65,000. Telephony continues to play an important role within our bundle offering by reinforcing the value proposition of the mass market. In mobile, our MVNO operation continues to gain traction. We closed the quarter with 740,000 lines, representing a 29% year-over-year increase, equivalent to 164,000 net additions over the last 12 months. Sequentially, net additions totaled 61,000 lines, making the best performance since early 2022, result of a commercial strategy with lower output but higher road rate. We continue to see mobile as a relevant complement to our fixed services and as an additional tool to strengthen customer loyalty, which now also contributes with a reasonable revenue stream. In content, Subscribers stood at 4 million as we continue adapting the product mix toward a broader digital proposition that is more aligned with how customers increasingly consume video. During the quarter, 3.8 million subscribers correspond to traditional video, while the remainder was contributed by the more than 2.2 million streaming app users recorded at quarter end. Our focus is on building a broader content proposition that combines linear video as another non-traditional consumption model. We believe that remains an important differentiator in how we position the service and maintain value perception at the household level. Overall, RGU's reached 15.2 million, an increase of 8% versus the same period last year. supported by the continued expansion of the subscriber base and the relevance of bundled services within the mass segment. Regarding Sharn, trends remain under control. During the quarter, Sharn stood at 2.0% in internet, 2.4% in video, and 2.1% in telephony. These levels remain manageable and do not indicate any deterioration in the underlying business. In fact, Internet video and telephone improved versus first quarter 25, despite the price adjustments implemented during this quarter. On the revenue side, ARPU continued to trend positively, supported by the aforementioned price adjustment. Under the new disclosure methodology adopted last quarter, ARPU calculated over Internet subscribers stood at 440.9 pesos, up 2% year-over-year. We believe this methodology provides a clearer benchmark for investors and improves comparability with peers. Finally, in the corporate segment, revenue remains softer on a year-over-year basis. The above was mainly due to the current market conditions leading to lower average revenue along with a more competitive environment in expansion areas, which requires us to be more creative and efficient going forward. The underlying operation continues to execute and we remain focused on service quality and commercial discipline that will allow us to go back to revenues levels before 2025. Overall, the first quarter was consistent with the operating trend we have seen in recent periods. Our platform remains strong Our network continues to differentiate the company, and our priorities remain centered on improving penetration, monetizing the scale we have built, and adapting our commercial and content offerings to what customers value most. Thank you for your attention. I will now turn the call over to Luis for the financial review.