Quebecor Inc.

Good day, everyone, and thank you for standing by. Welcome to Quebecois, Inc.' 's financial results for the second quarter 2023 conference call. I would like to introduce Hugues Simard, Chief Financial Officer of Quebecois, Inc. Please go ahead.

Ladies and gentlemen, welcome to this Quebecois conference call. My name, as was said earlier, is Hugues Simard. I'm the CFO. And joining me to discuss our financial and operating results for the second quarter of this year is Pierre-Claude Péladeau, our President and Chief Executive Officer. Anyone unable to attend the conference call will be able to listen, as usual, to a recording by telephone or webcast. Access details are available on our website at www.quebecorps.com. The recording will be available until November the 11th. As usual, I also want to inform you that certain statements made on the call today may be considered forward-looking, and we would refer you to the risk factors outlined in today's press release and reports filed by the corporation with the regulatory authorities. I will now turn the floor to Pierre-Cal.

Merci, Hugues, and good afternoon, everyone, or good morning, depends, you know. Yes, it should say good morning. Sorry about that. far away. So I am happy to report today the financial and operational results of our first quarter of operations consolidating the activity of Freedom Mobile. As you know, we closed this very important transaction on April 3rd and have been hard at work to put in place the numerous key milestones and realignments needed to execute our carefully planned, crucial back-to-school season. We are in the midst of it right now, and I have to say that I'm very pleased with the engagement and performance of our teams to further enhance freedom markets position and to reinvigorate the competitive dynamics in Canada. As we have said many times before, For us to succeed in our new endeavor and for true wireless competition to succeed and last in Canada, we need fair, reasonable roaming and ambiental rates that are in line with the government and CRTC objectives. In that context, we are pleased with the July 24th decision by the CRTC in the final offer arbitration process between GEDECOR and Rogers, which choose our position in setting the rates for access to Rogers' wireless network. The decision indicates that the CRTC and its new leadership are committed to increase competition in Canada telecom industry while encouraging network investment. The rates selected by the CRTC, which are in line with international rates, will enable Quebecor and its subsidiary to offer plans that are more affordable, accessible, and competitive across Canada to the benefit of consumers. We could not be more encouraged and positive with the new competition leadership at the CRTC, especially compared with the previous one, with whom we sometimes had to wait two years or even more to have a decision. Quick, effective decision-making is clearly to the benefit of all Canadians. That being said, our negotiations with the two other incumbents, no surprise there, remained difficult and no agreement had been reached yet. despite our repeated good faith at that. We had no other choices than to submit another request for final offer arbitration before the CRTC. We have just recently started the FOA process with Bell. In addition, it is essential that incumbent carriers be required who offer TPIA services through aggregated FTTH facilities for us to become a truly fort national player in wireless and wireline services in the rest of Canada. There are no justifiable reasons to slow down access procedures other than dilatory games being played by the telcos. In comparison, We and other cable operators have always diligently provided access to our coax network to TPIAs, even the ones wired at very hefty prices by Bell. Quite simply, we need to gain swift access to Bell and other incumbents' SDTH to compete directly with them and offer greater speed access at lower prices. The only reason why Bell offered the same 1.5 gig on STTH at $90 a month compared to $60 a month in Montreal, well, you have guessed it, is that TPIAs and others don't have access to a competitive price on STTH. Actually, going by the regulated STTH access rate of 129.79 cents. Bell is selling its gig at a loss, supposedly. While on the regulatory front, I would like to add that with respect to the new Broadcasting Act, Bill C-11. The CRTC and the government must introduce more regulatory flexibility and lighten the regulatory framework that is too burdensome for us from an administrative and financial standpoint. We must impose on foreign platforms a contribution obligation dedicated to Canadian content rather than an obligation to have Canadian programming expenditures to preserve the competitiveness of Canadian companies and not accelerate the decline of our Canadian broadcasting system. And to quickly remedy the precarious situation of private television, it is imperative to immediately withdraw advertising from all CBC Radio Canada platforms to put an end to unfair competition and raise for ratings. Finally, we welcome the adoption of Bill C-18 on June 22nd. As you know, following this passage, Meta announced that it would block Canadian media content on its Facebook and Instagram platforms, and has just recently started doing so. And Google announced that by December of this year, it will no longer offer Newslink in Canada. In response, Quebeco withdrew all advertising investment from its subsidiary and business unit on Facebook and Instagram. And in solidarity with the Canadian media, the Quebec government, the federal government, numerous municipalities and organizations have suspended their advertising of META, and several organizations have announced that they are redirecting their advertising investments towards the news media to the detriment of web giants. CEDECOR has long argued that to preserve the industry's sustainability and vitality, original content from the various platforms had to be included in this bill. Creation of a payment system is necessary in view of the web giant's market dominance. These platforms use the content produced by Canadian news organizations to generate a significant portion of the interaction of their network and must pay a fair price for it. Before turning to our operational results, I would like to highlight that Québécois on a consolidated basis had generated $455 million in cash flow from operation in the second quarter of 2023, and an increase of 26% over the same quarter of 2022. Lutron, with the addition of Freedom, improved its cash flow from operation by 25%, to $462 million, and its EBITDA also by 25% to $608 million in the quarter while maintaining the best margin in the industry. National performance is better than bells and tellers and allow us to start paying down debt as opposed to borrowing to service our dividend policy.