United Internet

Good day and thank you for standing by. Welcome to the United Internet quarterly statement Q3 2024 webcast and conference call. At this time, all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 and 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 and 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Dominic Korsman, Head of Investor Relations. Please go ahead, sir.

Thank you, operator. Hello and good morning, everybody. I would like to welcome you to our Q3 2024 Analyst Investor Call. Thank you for joining us today. My name is Dominic Korsman. I'm responsible for investor relations at United Internet. And here with me today, I have our CFO, Ralph Hartings. Briefly about today's program. Ralph will first take you through our presentation with the business development in the first nine months, and will also give an outlook for the rest of the year. Afterwards, we will be happy to answer all your questions. So far from my side, I would now like to hand over to Ralph. Ralph, please go ahead. The floor is yours.

Thank you, Dominik, and also a warm welcome from my side to our webcast on our nine-month figures 2024. Let's get into our numbers. On slide two, we have summarized our major KPIs for you. Our customer contracts increased by 420,000 to 28,870 in the first nine months of 2024. Our revenue increased by 2% to 4,660,000,000. EBITDA decreased by 1.4% to 978,000,000. However, it is important to note here that we have already invested more than 160 million in the rollout of our 5G mobile network in the first nine months of 24. Our EBIT declined by 11.2% to around 530 million. The decline in EBIT is driven by higher depreciation amortization as a result of investments in the rollout of our fiber optic network at 1&1 Bersatel and the rollout of the 101 mobile network. This increase in depreciation and amortization is to be offset by gradually increasing cost savings from this year onwards. EPS decreased from 1 euro 22 to 82 cents. This was due to a reduced EBIT, minus 26 euro cents, and the increased interest payments equaling to negative 14 euro cents. I will continue on slide three. Let's have a look at our segments, starting with consumer access. Going to page four. In this segment, we have increased our contract portfolio by a total of 90,000 contracts to 16,350,000 year to date. Mobile internet contracts increased by 130,000 to 12,000,000 380,000, while broadband lines remained broadly stable, being just shy of 4 million. On page five, revenue in the consumer access declined by half a percent to 3 billion, 17 million. The decline in overall revenues is attributable to the decrease in hardware sales as service revenue increased by plus 2.5% to nearly 2,479,000,000. Hardware sales, especially smartphones, are subject to seasonal effects and are also heavily dependent on the popularity of new devices and the model cycles of hardware manufacturers. This effect may therefore be reversed in the coming quarters. The lower hardware sales have, in any case, only a very minor impact on the results. The high margin service sales, which represent the core business of the segment, increased year over year, which is our focus area. Going to page six. EBITDA in the consumer access segment decreased by 9.4% to $463 million. The decrease in EBITDA in the existing core business is driven by the higher cost for the rollout of the one-in-one mobile network, as the breakdown on the next slide shows. The excess subsegment increased its EBITDA by 7.7% to around 630 million, while costs for the rollout of the mobile network, one-in-one mobile network subsegment, rose by more than 93 million in absolute terms. Switching over to slide eight, let's have a look at business access. We were able to increase sales here by 4.2% to around 430 million. On slide number nine, EBITDA and the segment increased by 2% to 120 million euros. The high quality expansion of our own fiber optics had a positive effect on EBITDA development as expected. despite the startup losses from the new business areas, 5G, and expansion of business parks at 101 Versatil. Looking at our core business, EBITDA grew by 5.4% in the first nine months of 2024. Our EBITDA margin remains broadly stable at around 28%. Let us now turn to the application segment, and I'll continue on Slide 11. Accounts from the consumer application decreased by roughly 1 million from December 31, 2023 to 41,660,000. The decline resulted from a 1.25 million decrease in free accounts due to seasonal factors and higher security requirements, while pay accounts, i.e. pay contracts, increased by 180,000 to nearly 3 million now. On slide 12, we are looking at revenues in this segment. We've increased sales by 11.8% to 218 million in the first nine months, mainly driven by our growth in paid contracts, as well as a slight positive development in the advertising market. Our EBITDA increased also by 11.8% to 78.9 million. As explained before, we had invested some of our top line accretion into future growth of existing and new data-driven business models. On page 14, business application segment, we increased our contract portfolio by 150,000 contracts to 9.54 million. The increase came to a large share from our operations abroad. Total revenue in the segment increased by 7.8%. The increase was driven from growth in web presence and productivity plus cloud solutions, which combined grew by 11.3%. Year over year, our total revenues grew by 11% in Q3. On page 16, EBITDA in the business applications segment increased by 9.1% compared to the same nine months of the prior year to over 320 million. The EBITDA margin rose accordingly from 27.7% to 28.1%. So much for our segments. On page 17, we have summarized the most important KPIs for the group once again and added a few more. We've already talked about revenue and EBITDA. Our capex amounted to $442 million after $460 in the previous year for the investments in our fiber optics network and one-on-one versatile and the rollout of one-on-one mobile network. As you can see, capex investments have a slight decrease compared to the same period of the prior year. However, this is mainly a phasing effect as we are expecting a very significant proportion of our annual capex in Q4. I will provide a detailed breakdown of free cash flow on the next slide. Our net liabilities to banks increased by 11.4% to over 2.7 billion. Our equity ratio reduced by 1.9 percentage points. Going to page number 18. Here we have our bridge from EBITDA to free cash flow. Largest items here are our net capex of approximately $440 million as a result of investments in the network rollout. Furthermore, we had a cash outflow of $260 million for our contingent payment, then phasing effects from Q4 2023 of around $100 million and taxes of roughly $200 million. including working capital of 68 million. This results in a free cash flow of 39 million, respectively negative 64 million after leasing. And finally, a brief word on the outlook, which you can find on page 20. We specify our guidance for the fiscal year and expect an increase in revenues to approximately 6.35 billion operating ebitda guidance remains unchanged to approximately 1.38 billion as you may have heard in the webcast of 101 hg today our guidance is subject to successful ongoing negotiations to compensate for the damages caused by the network outage CapEx, including NEMA transaction, is expected to increase by 15% to 25% over previous year's levels, in particular as a result of expansion into new business areas and for connecting mobile antennas. We continue to remain optimistic about the future. Thanks to its predominantly subscription-based business model, United Internet believes it is well-positioned to benefit from the investments made in recent yet in-customer relationships, new business fields, and internationalization. So much from our side. We are now available for any questions you may have. Thanks very much.

Thank you. To ask a question, you will need to press star 1 and 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 and 1 again. We will now go to your first question. One moment, please. And your first question comes from the line of Titus Crane from Bank of America. Please go ahead.

Hello, everyone. And thank you so much for taking my question. I got three questions, if I may. The first one is, for example, looking at your share price today, minus 15 compared to 1.09 at minus 7. Looking at my screen, IONOS at minus 5. Quite clear that your conglomerate discount has widened quite a bit just today. Could you provide maybe an updated view on any changes you could foresee on the company structure? Just looking at a result there today, which kind of makes it much more significant how big your discount is compared to your sum of the parts. Secondly, on the spectrum announcement that we'll probably hear in 2025, could you give any indication on when you expect to hear about the prolongation and to have a final result and relate to that, what that means to the timing of any potential use of the savings you could generate from not spending extra money on spectrum, but rather renting it and what that would mean to shareholder returns. And maybe thirdly, just on the general political and macro environment that we currently experience in, well, in Germany, do you see or foresee any macro impacts on the advertising business in mail and media or the fiber demand in the business parks that you see with the current political uncertainty, a budget that is not yet ratified and with the current macroeconomic pressures. Thank you.

Yeah, thanks, Titus, for your questions.

So, look, Obviously, we have seen the share price development of today, but we are not tying our future strategy thinking to daily moves in share price. Therefore, I don't think that there's any direct connect, even though I hear your argument, and obviously, we are considering things. we will announce those, you know, if and when we feel like it's probably the right time for that. With regards to spectrum, yeah, you probably also have listened to one and one's webcast. I mean, there has been the court ruling from Cologne, which kind of puts everything up in a question mark, whether the original spectrum that we've acquired kind of was kind of, was it really a legal process or not? Nobody knows. The Bundesnetzagentour has gone pretty quiet after that. We still don't know the explanation for the court ruling. And unfortunately, I also don't have a magic glass ball that can foresee the future, unfortunately. So I'm terribly sorry, but we'll have to just wait for the official authorities to come back with the next things to be announced. And I think you'll probably learn, and at the same time, we will. Um, and then, um, unfortunately to the last question you fed as well. Um, uh, I mean, I, I don't know whether there's going to be a significant impact to the advertising industry or not. Um, I don't know if Germany will go into recession or will recover. I don't know if maybe a new government, which I think I just read today is going to be elected on the 24th, the 23rd of February. Uh, um, it will change things and everything will be bloomy and rosy again, uh, comes a year time from now. I'm hopeful, obviously, but the one thing I'm pretty certain of is the need for the services that we are offering and our core assets are so vital and essential to modern people's lives that I don't foresee any significant impacts, even though should the economy not maybe start blooming again. Hopefully that is a bit helpful. Thank you. Thank you.

Thank you. Your next question comes from the line of Andrew Lee from Goldman Sachs. Please go ahead.

Yeah, hi, everyone. Just had, obviously, lots of questions and answers already back and forth. But just wondered, you've spoken about the kind of near-term offsets you can make for the German pressures you're facing, so cost savings, et cetera. However, there's been a structural change in the market, partly driven by your network build strategy, partly driven by the shift in wholesale contract that means that we've now entered into a weaker growth outlook for yourselves when we talk about the top line and potentially for the market. That's question number one. And then question number two, if that's the case, Is there anything you can do about that? I know you referred to, you're thinking about a few, you're considering a few things, Ralph, but just wondered how you're thinking structurally about ways that you can potentially impact the growth outlook of your business here. Thank you.

Hi, Andrew. I think in your first question, you're leading to structural changes in the market because of our actions, i.e., building our own network and switching national growing partner. Obviously, it's hard to tell if and when markets change, but to make a kind of logical movement because we did this and that market change, I'm struggling because we have been there before. We will be there thereafter. The only thing that is changing is that we are internalizing, as I've explained, I think, a few times in conversations before, external costs to internal costs, which is the key driver of our decision to build our own network. And still, we've got a good 12.5 million subscribers, and we clearly want to continue to grow those in the mobile segment, and that's not changed. I think your question would be more relevant if we would really be a new entrant into a market. And that's clearly, that's not the case. Because new entrants, you know, they obviously need to gain market share before they can start to become, I guess, more profitable. So I wouldn't say that there's a direct connection. And yeah, I'm very hopeful that every player in the German market will start acting really rational. But obviously, I can't speak for any of our competitors. And with regards to your second question, yeah, again, I, you know, no, I don't think that there's any now that now is an inflection point, you know, to do things. I think, as I've always explained before, we, you know, we like here in United Internet opportunities and, you know, we like to be flexible and therefore we will, you know, continue that path and and then start changing things when we think it's the right time.

Thank you. I appreciate that.

Thank you. Your next question comes from the line of Polo Tang from UBS. Please go ahead.

Hi, thanks for taking the questions. I have three. The first question is just on IONOS. Can you give us your latest thoughts on a spin-off of IONOS, and what is the latest thinking in terms of any potential tax implications. Second question is just really on free cash flow and use of cash. So how should we think about the trajectory of free cash flow going forward over the coming years? So for example, if things like the data center built at 101 is largely complete, If you have less of a drag from payment terms to Deutsche Telekom in terms of their broadband contract, can you see improving or positive free cash flow for United Internet in 2025? And if we get visibility in terms of the 800 megahertz spectrum allocation and there is no auction, how do you think about the range of possibilities for use of cash and how do you think about the priorities And my third question is really just a bigger picture question in terms of the network build. When can investors start to see the benefit of the network build? And if you don't get access to low band spectrum, would you limit your build to 25% population coverage rather than continue building to 50%?

Thanks. Okay.

Maybe I miscounted. I think I got it. four questions roughly, but maybe there was just one. Anyway, I'll try to answer all of them as good as I can. So with regards to IONOS spin-off, there are potential ways to spin IONOS off in a tax-efficient manner. It hasn't been done before in that form or fashion in Germany yet, but there are theoretically ways of doing so. And yeah, that might be an option at some point in the future. But again, I'm not changing what I've just said before to the other questions. I'm not going to change anything. I'm not stating anything. And then with regards to free cash flow, no, I don't think we're going to see next year a positive free cash flow. We are still you know, in the heavy investment phase. I think we've consistently communicated that also to the public. So next year is again a CapEx heavy year. Yes, we will have less payments, clearly for the contingent payment, that's helping, but overall still a great level of investment. So I can't foresee a positive free cash flow in 2025. The years after, yeah, things will certainly change. And then what to do? Let's see, right? I mean, obviously we've leverage the company higher, so we can probably start delivering and therefore save interest again. We could also consider, you know, maybe doing a catch-up on the dividend, which had been a bit low in the past years. I think, as Mr. de Monmouth has also said, that he would like that very much in one of the recent announcements we've had. But, you know, to be determined. With regards to, I think that was maybe the third, if there is not an auction for the low-band spectrum and we don't have a large cash-out for that, what would I do with that money? Well, look, first of all, I need to have that money to spend it, right? So, yeah, clearly, as we are on a negative cash flow, and currently, as you know, we are increasing debt a little bit in the company, I probably need to less increase the debt because of that. And it'll just help us to return to positive cash flows quicker. But I'm not saying that, oh, yeah, this is a great thing, what I'm going to do with the kind of, whatever, 800 million, billion, 700, 500, I don't know. So I don't think I can kind of spend money that I kind of don't have yet really. And then the last one was if we would limit our rollout to 25% if we don't get low band spectrum. Look, again, the Cologne court ruling did put at question the conditions of the spectrum that we've had acquired. Until I know what that means, I can also not say, you know, that we're going to change. Maybe we don't have any obligation anymore for 25% or 50%. Maybe the whole thing repeats. Maybe we get a different condition. Anything, it's completely up in the air. So I'm not able. Our plan A is to continue building our network. Our plan A is we are going to get low-band spectrum because, as you know, we need that in order to build an efficient network which has got deep indoor coverage in dense urban areas, which is what we need. I don't care so much for the rural areas as we're not going to build there much. So, yeah, unfortunately, I can't give you much more clarity, Paulo, at this point.

Ralph, maybe just following up on the last question, when can investors start to see the benefit of a network build?

Yes, look, obviously, I think 1&1 spoke about it, right? If we would have had converted more customers by now or migrated onto our network, investors would see that already today more. And, you know, unfortunately, we've had this outage and then the loan is so clearly in 2025, given the fact that 1&1 is back with, you know, I think they've quoted a 10,000 and they're going to increase to 30,000, 50,000 a day. Each converted customer, as you also know, is straight saving because of, you know, the voice traffic, which is not getting more built by the minute, but it's voice over data. So that's just a fraction and voice needs very little data. And the second is every customer that is migrated and goes abroad and Germans like to go on holidays to Spain and you know, lots of places, uh, we gonna save significant money on the fees we have to pay to other operators for international roaming. due to our roaming deal with orange, with much more favorable conditions. So clearly, we will start to see that very soon. OK? Thank you. In greater numbers. OK.

All right. Thank you. Your next question comes from the line of Andre Dragalici from Kepler Showroom. Please go ahead.

Hi, thank you for the opportunity of asking questions. Just coming back on the contingent payment to Deutsche Telekom and the price going to be lower next year, would it be possible to quantify the expected payment for 2025? On the other side, how happy are you right now with the relationship with Vantage in terms of mobile site accesses? and how do you see it going forward? And maybe a third one on customer acquisition in net ads in broadband. You had the ambition of stabilizing the base in 2024, but Q2 and Q3 are coming negative. How do you see your broadband business going forward? Thank you.

Hi. So hang on, the first one, yes, sure, I'm happy to give you a view on contingent payments. So as you know, it was like 260 this year. We expect something really mid-double-digit million, okay, which kind of means around the 50 million or so, somewhere in that range from the year after, from 2025 onwards. Vantage relationship. Vantage is, the Vantage relationship, look, we've never had a bad relationship. They just didn't supply the sites that we wanted to have. And obviously that has improved a lot. Vantage is still part of our future plan. Vantage is supplying a lot more sites than they did in the beginning. So I would say this is really on a good trajectory and on a good track. And the last question was really on the broadband. We wanted to stabilize. Yes, you're absolutely right. I think there is a dependency because the contingent contract with Deutsche Telekom is really that we kind of help them rolling out fiber to consumers and to homes and obviously depending on how quickly they can progress and that will then help us because we can hold sale on their infrastructure then. That was the whole idea of the contingent deal. And so the more successful they are at acquiring new areas, the more successful we can be. And I think hopefully we will see a good and nice stabilization and turnaround comes next year.

Thank you. Thank you.

Thank you. Your next question comes from the line of Adam Fox from HSBC. Please go ahead.

Oh, hi there. Thanks very much. I've got a couple. The first one is whether you could just give us an update on how you're thinking about the investment into business parks with Versatil. Are you seeing on the back of the investments that have been made in recent quarters, are you seeing kind of take up that keeps you satisfied that that is the right place to deploy capital at the moment? And then the second question was on the EBITDA guidance, and I'm sorry if this has been answered on a different call. I just want to make sure I really understand what's being said. So if I got your comment correctly, Ralph, you said that the guidance includes some compensation, but on the 9-9 call, they weren't willing to give any details of that compensation. I mean, I guess the question is, how certain do you need to be that that compensation payment is going to be paid in order to maintain your guidance, if that makes sense? What can we read into that? Thank you.

Hi, Adam. So, okay, on the business park Versatel, yeah, look, absolutely we are happy with the investments we do there. We do track, you know, all these business parks very closely. We look at, you know, how each is developing in terms of adoption, in terms of penetration, and, you know, so far I can say we're absolutely happy. As you know, Germany really is still heavily underinvested in fiber, and we do believe strongly that, in particular, um putting more business in the connectivity with the fiber line and they're very loyal very low churn very happy customers obviously the future will demand more and more and more and more data and quicker and so therefore we believe that our investments there are really um solid and very meaningful and i think i've mentioned that before my boss mr domomuthi always says young man that that's for retirement a little bit so obviously these are long-term investments And after a certain number of years, they start to become really, really profitable and start to make a lot of fun. So we still believe that this is a good investment. But obviously, any investment decision is really carefully looked at. And sometimes we say yes, sometimes we say no to one. So we just go to the ones that we believe that are really beneficial and pay back. And now, big disappointment for you. I'm not going to disclose anything more than what my colleagues did earlier. Because I'm just consolidating it up here and that's kind of a one-on-one thing and and I do trust my colleagues Fully that you know, we've we've you know done the right thing. Yeah, but I'm kind of close anymore So there is an element included.

Yes, and that's about it All right, thanks very much Thank you Your next question comes from the line of Joshua Mills from BMP Paribas, please go ahead and

Hi, guys. I am actually going to come back to Adam's question because I think it is really important for us to understand this for next year as well as this year. Anton, you're going to talk about the specific amounts which you're including in the guidance for compensation. But could you just give us a bit of a detail on how that should be accounted for in the split between the startup costs and the underlying EBITDA? The reasons I ask are that if I look at the plan for this year, you said you'd spend 174 million on the startup costs. You're already at 167 million. I guess the implication is that you will be spending more than that over the course of this year, were it not for this payback from the compensation claim. So just getting a sense of what the actual underlying spend on mobile network costs this year versus 174 million guidance would be very helpful. And then secondly, on timing, there's only a month and a half left of the year now. In the past, you've updated and revised guidance mid-December. And I think that's the point in time where you have to kind of close the books and make sure that you know what the number is going to be for full year. So are you confident that you're going to get a resolution on this compensation claim within the next month? And if not, is there a way in which you could resolve it next year, but potentially book it into 2024 numbers so you can keep the guidance in place? Because otherwise it looks very challenging to hit the 54% EBITDA growth which you're guiding for on Q4.

Thanks Okay, Josh so Look you said how this works and look in in in the Let me explain you the principle in the one and one mobile network kind of sub segment Yeah that we talked about this is the area which kind of you know built a network and then you know also Generate clearly savings because of internalization and clearly savings from that. We've got as I've explained a minute ago savings from voice traffic over LTE instead of minutes and all that stuff so because that didn't happen quite yet clearly, you know the costs look higher from their end and And therefore and if there is a compensation element, it will go against that and Okay, so hopefully that makes it more clear. In terms of guidance into the network investment, I think the team has had one-on-one issue to guidance. I don't think that this is going to be super different than what they've issued. But again, maybe you should have asked them a minute ago. But no, in all honesty, I think that still holds in place. And then the last part is, yeah, look, I mean, we will know when we know, and as you said, I trust the 101 team that they have got a solid case that they've made where they've issued it in guidance, and therefore I'm also just as comfortable, I guess.

Okay, so just to clarify, you're saying that... regardless of what happens, the 174 million of network investment is the right number, and the compensation would go into the other mobile business. If that's the case, why is the phasing so different this year on mobile network costs? I think in Q4 2023, you spent about 60 million euros. There's a 60 million euro EBITDA drag in Q4, whereas this year you're saying it's only going to be 7 million. Is it simply due to the timing of the build or is it something changing with how you account for the network expense? Because the phasing just looks very difficult to understand from our perspective, I suppose.

Yeah, no, sorry, if I didn't explain this right. So the savings go also into the one and one 5G subsegment, okay? So given the fact that they hadn't been able to realize as many savings, is why the spend looks now higher because the offsetting savings weren't yet included to the extent that we wanted it to, obviously in a smaller number because you clearly have got customers converted. So it's not going to the other segment. Okay, so hopefully that makes more sense now on the phasing. Okay, thank you. Yeah, okay.

Thank you. Once again, if you'd like to ask a question, please press star 1 and 1 on your telephone keypad. We will now take the next question. And your next question comes from the line of Simon Stepik from VARBOC Research. Please go ahead.

Hi there. Thank you very much for the opportunity to ask question. First one would be in regard to consumer applications You have nice top line growth there. Translation to EBITDA is also quite good. I just wonder here, because you mentioned your increased investments of the top line profitability into the project you're currently having. So could you speak about a normalized margin on your segment here, and then also when do you think this project would actually be finished or finalized and what returns it would yield? And the second one would be in regard to business access. Could you speak about your sources of growth year over year, especially in respect to the one-on-one consumer access segment? And third one would be just one follow-up in regard to the migration. Is it possible that you quantify your savings you have per customer per annum? And would it be the right figure to assume that given your five months of delay, which would translate to 100 days and let's say 30,000 migration customers per day that this number would be actually three million higher thank you very much okay hi Simon so first of all consumer applications

It's not just one project that we are investing. We've identified with Michael, who is our new CEO, a few areas of focus, of which clearly one is to continue to drive subscription revenues. So the team is working on making the subscription, basically what you get, the value from the subscription from a customer's point of view, even more valuable, i.e. putting some extras in. which then would make probably consumers' lives easier. And that's an area they're focusing on. So to give a bit more benefit for as to why should I actually pay like six euros a month for my emails. That's one area. And the other area is to continue to really monetizing on all this data treasure, I guess is the right word that we are sitting on. to really start monetizing that by helping therefore advertising becoming more relevant and therefore you can increase the yield. So that's kind of the second key area of investment. And then there's a few other ones. So, and these are not huge numbers. Okay. So I think this year they've hired 30, 40 more developers. So if you know what a developer costs per year, you know, kind of, you can make a mess a little bit yourself. Um, we're not talking about massive numbers. So, uh, and given that anyway, the numbers aren't that great, you know, a few millions kind of make percentage point wise, uh, quickly a big difference, but, uh, yeah, I, I wouldn't get too excited about, you know, exactly how much, uh, would be normalized. Um, I think it's kind of normalized with the investments we do because we think that's driving the future goals. Um, I'm not sure I, a hundred percent got, I need to look at Dominic the second one, the business access and the one and one. Can you maybe help me again, Simon, to get a bit clearer? Sure.

Sure. The end was in regard to business access versatile, your sources of growth, especially, so your source of growth year over year, especially in respect to one-on-one, your consumer access segment.

Okay. Sorry. Yeah, I get you. So it's not the biggest part of the growth that we are seeing there. So the internal kind of from one-on-one is not, is not the most significant. So the biggest growth is coming from the core business as well as the business parts, and then there is an element of one-on-one. In the future, it'll change because it'll become bigger and bigger, but at this point in time, it's clearly not the most significant part of it at all. And then, as you've asked for, how much is it per customer, per migrated customer, the savings? Honest to God, I can't give you a clear number for that as a per customer and then even per day or so. happy if we'd follow up afterwards a little bit, maybe with Dominic, to see how we can help you to get your math a little bit specified. But yeah, I don't have a number at hand for you on this question, okay?

Okay, great. Thank you very much.

Thank you. Your next question is from Andre Dragalicci from Kepler Shiro. Please go ahead.

Hi, thank you for the opportunity. Just a follow-up question. So if any compensation, if anything would come from your suppliers would go into the mobile network segment in supporting the EBDA of the mobile network segment, this is related to savings. Maybe looking at the EBDA guidance for the access segment, This implies around 14% increase in Q4 for a service revenue at around 1% increase. So maybe there are some savings there or something, but could you maybe break down for us how these mechanics work for the access segment?

Yeah, hi. So first of all, completely properly understood. So any compensation for damage claims would go against the mobile segment. And then I think Markus also alluded to it in the one-on-one call. So clearly the team is looking at OPEX saving opportunities as well as in marketing, you know, where to probably be more efficient and therefore be able to save some. So that is benefiting clearly than the excess segment not the mobile segment. So these are the key drivers overall, which then leads to the guidance. Thank you.

Thank you. Thank you. There are currently no further questions. I will hand the call back for closing remarks.

Thank you, operator, and thank you, everyone, for attending our call today. Please do not hesitate to contact us for any follow-up questions. We wish you a nice day. Stay safe, and goodbye from under the bar.

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.