NOS, S.G.P.S., S.A.

Good afternoon, everyone.

Thanks for joining and welcome to the fourth quarter and 2025 full year results conference call. As usual, we will start with a brief presentation by our CFO. And then we'll open for Q&A and we have the executive team in the room for that as well. So wish over to you.

Thank you, Pedro. Good afternoon to all and welcome to our conference call. We will begin as usual with the main highlights of this fourth quarter. In the quarter, NOS maintained a positive operational momentum despite new competitive environment, leveraging 5G and nationwide fiber-fixed infrastructure. Also a healthy cash flow generation driven by top-line growth, operational efficiencies across OPEX and CAPEX structural decline. and an attractive shareholder remuneration with a strong dividend yield while maintaining a robust financial position. A quick overview of our main KPIs. During the fourth quarter, consolidated revenues increased by 0.3% to $486 million, and EBITDA rose 4.4%. This solid EBITDA performance, along with a capex reduction of 4%, led to improve the EBITDA minus capex of almost 21%. Recurring free cash flow, excluding extraordinary effects, increased 132% to 71 million, and net income increased 58%, reflecting a solid operational performance and our strategic transformation program. Our annual numbers also reflect a strong performance, which we will discuss in more detail later in this presentation. So, NOS has achieved upgraded classifications from both CDP and S&P global ratings, recognizing its significant ESG efforts. The CDP score improved from B2A, reflecting the leadership position in the fight against climate change, a distinction achieved by only 2% of the companies. Furthermore, NOS S&P global score increased from 58 to 75, nearly doubling the sector average of 40. As part of its dynamic strategy to create value, NOS is enhancing its customer value proposition through Combina, a new initiative in partnership with GALT and Continent. This program offers unique customer benefits, including up to a 10% discount at Continent and a 30 cents discount per liter on fuel at GALT. This significant savings can partially or even fully offset the family annual telecom costs. With 150,000 customers in the first two months, Combina is a key component of knowledge value proposition translating into significant savings for our customers. Our scale program with 140 AI use cases identified and already 40 implemented is a key driver of our efficiency contributing to a 2.3% reduction in four-quarter OPEX. The personal productivity vertical, one of our seven scale initiatives, is successfully massifying AI across NOS. NOS GPT supports over 4,000 users with an impressive 40 daily adoption, and our fast-running program has already reached over 1.4 thousand employees. With scale, we are effectively boosting efficiency throughout NOS. On the operational performance side, this was another strong quarter of fiber to do. More than 6.1 million households are now covered by no gigabit six network, with fiber representing almost 90% of households past. This is a significant increase of 159,000 households quarter on quarter and almost 380 year on year. But despite the challenging competitive market, NOS delivered a strong four-quarter with 2% increase to 10.9 million RGUs. With 66,000 net ads, this quarter posted a good level of net ads despite natural four-quarter seasonality. We achieved 7,000 net ads in unique fixed accesses in the quarter. Despite the seasonal slowdown and intense competitive environment, these results are consistent with pre-DG levels. Churn continue at low levels and new offers, woo, a noted broadband, continue control, but with some impact in the mix of new customers. In mobile, with 62,000 net has in the quarter, Mobile RGU's increased 3.3% year-on-year, reflecting a strong performance, particularly in PostPaid customers with higher RPUs. PostPaid had 88,000 net additions, posting very strong results driven by Woo and by Nosh competitiveness on conversions cross-sell. Prepaid net additions declined 26,000 in the quarter, below for quarter 24, driven by the competitive pressure that impacts more on low ARPU customers. In summary, a solid operational performance despite the competitive environment. Now moving to audiovisuals and cinema business, the number of tickets sold declined 19% year-on-year, an improvement versus the minus 28 of third quarter, driven by a difficult October and November, but with a solid December, with revenues flat year on year, supported on Zootropolis, Avatar and Now You See Me, all movies distributed by NOS Audiovisuais. On the financial performance side, NOS consolidated revenues rose 0.3%, mostly affected by an 8% decline in audiovisuals and cinema division, that were offset by the resilient performance of the telecom segment, and by the solid 4.4% growth of IT. Telco revenues were flat year on year, primarily due to the performance of the enterprise sector that posted a 1.3% increase driven by large company segment and wholesale. The B2C segment experienced a decline of 0.4% due to the increased competition impacting our pool, despite the strong operational activity and solid equipment sales. Still, an improvement versus the decline of minus 1.1 in third quarter. Revenues in the B2B increased by 1.3% to 123 million, continuing the growth path from previous periods. The slowdown in the overall revenue growth of the business results from a lower volume of projects and resale with lower margins. The new IT business showed a strong increase of 4.3%, mainly driven by a solid 9% growth in IT services, and despite the 3% reduction in the volatile resale of equipment and licenses. As previously explained, the audiovisual and cinema division reported a 8% decline, driven by the 19% reduction in cinema attendance. So, NOS operational performance and solid results of NOS Transformation Program supported on GenAI with an efficiency program, continued to deliver strong 4.4% EBIT increase, significantly above revenues, with a strong contribution from telco and IT, which recorded increases of 4.4% and 11%. Audiovisuals and Cinema Division posted a 1% EBIT increase, despite a 8% decline in revenues. NOSH CapEx continues the structural declining trend, and this quarter dropped 4% to 92 million, supported by a CapEx decline in all lines of businesses. Telco CapEx declined 1.2%, driven by a 2.6% reduction in customer-related investments. Expansion CapEx had a small increase of 0.4% this quarter, mainly driven by fiber projects as we approach the end of NOSH fiber deployment. IT capex declined 3.34% to 1.9 million, explained by an exceptional customer-related investment during 4.24, and audiovisuals and cinema capex declined 24%, reflecting a return to a more normal spending level in movies after the higher investment in 2024 caused by the Hollywood strikes and by a reduction in cinema capex. As a result, improved operational performance and efficient capex management drove to a 20.6% increase in EBITDA minus capex. Net income declined to 10.9% to 63.8 million, primarily due to a reduction of 31 million in extraordinary effects, mainly related to ANACOM refund of activity fees in 4.24. However, excluding these items, net income rose 23.5 million, a 58% increase year-on-year. It's a strong increase driven by a strong EBITDA growth, supported by a solid operational performance and by a proactive cost management, complemented by a 10 million contribution from tax reduction and by a 3.9 million in results from joint ventures. Free cash flow increased 155%. with a 2.8 million positive year-on-year impact from an extraordinary tax payment in 2024 related with the ANACOM refund of activity fees. Without extraordinary items, recurring free cash flow increased 132%, driven by 11.7 million from strong operational performance and lower investments, by a positive impact of $22 million in working capital and by a reduction of $5.6 million of income tax paid. So now moving on to the final year key financial numbers, despite stronger competition, NOS demonstrated a resilient revenue performance in 2025 and strong OPEX and CAPEX efficiencies leading to a solid EBITDA L minus CAPEX growth. Consumulated revenues increased by 1.6%, with telco growing 1.6% and 83.5%, offsetting a 2.6% decline in cinema and outdoor visuals. Consolidated EBITDA also grew by 4.3%, while EBITDA minus CAPEX saw a significant 15% increase. NOS showed strong growth in net income and free cash flow in final year 25, excluding extraordinary items. net income after adjusting for these items increased 29% and free cash flow excluding these items also rose by 15% indicating the solid underlying financial performance. So, at the close of the year, NASDAQ decreased to 1 billion and 22 million and the financial leverage ratio dropped to 1.5 times well below the reference threshold of two times. Additionally, Now it benefits from a lower average cost of debt, now 2.7, representing a decrease of 0.8% year-on-year, reflecting lower interest rates. As end of December, the company held 342 million in cash and liquidity. So, with all these elements in play, the board has approved a total dividend of 45 cents per share, composed of 35 cents ordinary and 10 cents extraordinary. This payment reaffirms our strong commitment to an attractive and sustainable shareholder remuneration. With this, we conclude our presentation and we are now ready to answer to your questions.