This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
spk01: Good day, ladies and gentlemen, and welcome to the Trilogy International Partners Q2 2021 earnings call. At this time, all participants have been placed on a listen-only mode, and the floor will be opened for questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Anne Saxton, Vice President of Investor Relations and Corporate Development. Ma'am, the floor is yours.
spk02: Thank you, Kate. Hello, everyone, and welcome to our conference call to discuss our results for the second quarter of 2021. This call is also being broadcast live over the web and can be accessed in the investor section of the Trilogy International Partners website. Joining me today are Trilogy's President and CEO, Brad Horwitz, and Trilogy's Senior Vice President and CFO, Eric Mickels. This call includes forward-looking information from which our actual results may differ materially. For further information regarding the various factors, assumptions, and risks that could cause our actual results to differ, please review the cautionary language in the About Forward Looking Information section of yesterday's press release, as well as the cautionary note regarding forward-looking statements and the risk factors in our 2020 Annual Report on Form 20F, available on both CDAR and EDGAR. This forward-looking information represents our expectations as of today and, accordingly, is subject to change. We disclaim any obligation to update forward-looking information, except as required by law. Please also refer to yesterday's press release for definitions and reconciliations of any non-GAAP measures that we used during today's call. The press release is posted on our website at Trilogy-International.com under the Investors tab. I'll now turn the call over to Brad Horwitz, President and CEO of Trilogy International Partners.
spk00: Thanks, Anne, and hello, everyone. Thank you for joining us for our call. Today, I'll provide you with an update on our business, and then Eric will take you through our second quarter performance and outlook for the rest of the year. 16 months ago, our operating markets were in the midst of severe social restrictions as they grappled with the onset of the global pandemic. Our local teams made a number of adjustments early on to address potential impacts and positions for emerging from a COVID environment. Since that time, through effective management by its government, Life has resumed to normal in New Zealand, although the international borders still remain closed. Given the closed borders and the importance of travel and tourism to the New Zealand economy, we are not yet experiencing the reopening tailwinds that our North American industry peers are beginning to see. However, two degrees resilience and strong execution has resulted in continued solid results and we're pleased with our second quarter performance. Solid revenue growth over the prior year continues across all of our product lines with accelerating momentum in our B2B business, again bolstering our postpaid subscribers. Our B2B base has grown by 24% compared to a year ago, as our mobile B2B activations in the quarter grew 85% year over year. Our prepaid and fixed broadband products in New Zealand also continue to perform well, with double-digit ARPU growth in the second quarter compared to a year ago. Our increasing scale in New Zealand drove organic year-over-year segment-adjusted EBITDA growth of 8%. Bolivia, in contrast, continues to be impacted by COVID-19, and the second quarter brought with it a third wave of cases which have prolonged compression of our service revenues and segment-adjusted EBITDA. Despite these challenges, our local team remains resourceful and effective at controlling costs as it focuses on maintaining cash liquidity as we bridge this period of instability. Moving on to specifics by market, starting with New Zealand, our strong financial performance continued in the second quarter. Despite the ongoing lack of tourism in the economy, our local team's successful efforts to position for coming out of the pandemic including leveling up key roles in our organization, are evident in our strong results. This can be seen in the acceleration of our B2B customer activations and the ARPU growth of this base, improved prepaid data monetization driving higher ARPU, as well as improving pricing strategies in our fixed broadband business. We continue to grow our subscriber base, though consumer activity remains somewhat subdued. Retail foot traffic continues to be about 20% below pre-COVID levels, which has impacted activations. We believe this is due to ongoing border closures as well as a potential shift in behavior as people continue to work from home. Our continued retention efforts and active churn management have resulted in sequentially improved churn and net addition growth across all of our products. In the second quarter, our blended wireless churn of 1.71% was the lowest in 2 degrees 11-year history. It's challenging to estimate when the New Zealand borders will reopen. In April, a travel bubble with Australia was established and limited travel resumed, though at about 30% of pre-pandemic levels. In late June, an Aussie traveler in Wellington was confirmed to have the more contagious COVID Delta variant, resulting in a short period of level two restrictions in the area. Fortunately, there was no community transmission. With the subsequent broader outbreak of the Delta variant in Australia and resumed government lockdowns there, on July 23rd, the New Zealand government closed the travel bubble indefinitely. On the vaccination front, while there's adequate supply to fully vaccinate the entire population, only about 16% of New Zealanders have been fully vaccinated to date. The government has indicated that it is targeting 90% of its people being fully vaccinated by the end of this year. Our B2B product continues to accelerate, bolstering our postpaid mobile business. Our activation run rate continues to increase, and we continue to see growth opportunities ahead. Our big win in the second quarter was securing the New Zealand Post as customers, which could very well be the biggest B2B account in the market for 2021. This is on the back of winning the New Zealand Health Group account last year, which was the largest enterprise account in 2020. After a few quarters of tempered broadband activations, our marketing efforts to increase market awareness have gained traction. In the second quarter, spontaneous recall of our broadband product improved by 9% compared to last year, and we increased gross ads by 18% compared to a year ago, which also surpasses our second quarter 2019 activation levels as a pre-COVID reference point. We continue to make headway with our new wireless broadband product Gross ads increased five-fold sequentially in the second quarter. This subscriber base consists of both new customers as well as existing Two Degrees customers that have migrated from copper, which is accretive to our margins as we no longer need to pay Chorus a monthly access charge for those subscribers. Though just getting started with our wireless broadband product, we believe that the market opportunity is extremely significant for us. We were also pleased to see our mobile net promoter scores improve versus the last quarter. This result is supported by a number of effective efforts by our local team. In addition to proactive churn management, including the doubling of our customer save rates, we have improved our customer care metrics. We've worked hard on the network as well over the last 18 months to ensure parity with our competitors. In addition to strengthening our own network footprint of more than 1,300 sites across New Zealand, we now have an additional 237 new sites that expand our coverage through the infrastructure sharing agreement that we put in place last year. As we have mentioned previously, the new infrastructure sharing agreement provides an LTE experience for our customers, whereas the prior roaming arrangement was 3G only. In addition, more than half of the almost 500 sites contemplated by our rural broadband joint venture with the other two mobile network operators are on the air. As a result of our efforts, independent mobile analytic firm OpenSignal has again named Two Degrees as the top-ranked mobile operator in New Zealand. We received best performance accolades across several categories, including voice, video, and gaming. Regionally, we were also recognized as the number one provider in the Auckland region and received high honors in other areas as well. With respect to 5G, our network deployment is making progress and we remain on target to launch service before the end of the year using our 60 megahertz of limited term 3.5 gig spectrum. We continue to expect the long-term spectrum 3,500 meg rights to be auctioned off in the first half of 2022, with usage to begin in late 2022. Finally, a short update on the progress of our planned New Zealand IPO. We recently selected as joint lead managers Macquarie, Jardine, and Craig's, all are top tier in New Zealand and Australia, and bring solid expertise and execution experience. In July, our senior management team participated in more than 60 virtual non-deal roadshow presentations across New Zealand and Australia. Preparations continue as we plan for a listing before the end of the year, although the final decision will of course be market dependent. Turning now to Bolivia, after some improvement, the country entered a third wave of COVID-19 early in the second quarter. Cases appear to have peaked in early June, with mobility restrictions in place in most cities during the quarter, as well as increased vaccine supply, cases have been steadily declining. Early August numbers are similar to the end of 2020, which we find very encouraging. As expected, the resurgence of the virus in Bolivia has dampened our second quarter financial results. With mobility down and government subsidies several months behind us, Commercial activity in the country has been limited. We have been focused on retaining prepaid market share and increased our acquisition promotions to support this effort during the quarter. As a result, our prepaid activations increased 10% sequentially and our net additions significantly improved. While the pandemic resulted in a slight contraction of our postpaid base over the last several quarters, The proportion of our subscriber base in Bolivia that is postpaid at about 14% continues to be larger than that of the broader market. While the local economy remains pandemic constrained, our local team remains focused on cost controls and cash management. Further, our priorities have not changed with respect to optionality of this asset. There continues to be interest from third parties in acquiring the business, and we believe that there continues to be meaningful value with a compelling brand, a stable customer base, and strong network and a spectrum portfolio. With that, I'll turn it over to Eric to take you through the numbers. Eric?
spk05: Thanks, Brad, and hello, everyone. Before jumping into the details, a couple headlines for the quarter. First, another strong quarter in New Zealand as year-over-year service revenues increased 27% and segment-adjusted EBITDA increased 22% on an as-reported basis with a strong New Zealand dollar providing a 16% tailwind. Secondly, in Bolivia, where COVID-related headwinds persist, management continues to focus and do a great job on cost controls and cash management. And finally, we are pleased to have completed in the second quarter the extension of the trilogy debt maturities. This extension of the maturity dates from May 2022 to May 2023 provides strategic flexibility and also supports the potential deleveraging from the IPO in New Zealand, which is planned for later in the year. Before providing specifics on financial results, note that our reported results may be impacted by changes in U.S. GAAP, as well as foreign exchange fluctuations. Specifically, we implemented the new lease accounting standard in the first quarter of 2020 and the new revenue accounting standard, or NRS, in the first quarter of 2019. Please note that prior periods were not recast for the new standards. As mentioned, the strength of the New Zealand dollar relative to the U.S. dollar also impacted our reported results in the second quarter, providing the 16% year-over-year benefit. As such, where noted, we refer to results on an organic, like-for-like basis, which is excluding the impact of accounting changes as well as foreign currency. We believe an organic perspective enhances comparability between periods. Moving to the numbers, our consolidated business ended the second quarter with approximately 3.2 million wireless subscribers. Our post-paid wireless customer base as a percent of total wireless subscribers was 24.1%. Our consolidated service revenues in the second quarter of $134.2 million increased 5% year over year on an organic basis, as our growth in our New Zealand subscriber revenues more than offset reduced service revenues in Bolivia. Our consolidated operating expenses in Q2, excluding cost of equipment sales, were $136.7 million. This was an increase of 3% versus the same period last year on an organic basis as an increase in operating expenses in New Zealand was partially offset by continued cost discipline in Bolivia. Our second quarter consolidated adjusted EBITDA was $28.2 million, a 2% decrease on an organic basis versus last year as our growth in the New Zealand business was more than offset by declines in the Bolivia operation. Our consolidated capital expenditures for Q2 were $29.5 million versus $15.1 million a year ago, with the increase due to timing of spend in both markets. At the end of June, we had a total of 2,642 sites on air. This is a 6% increase compared to Q2 2020. Turning now to our results by market, in New Zealand, our post-paid mobile base grew 8% versus prior year and now makes up 35.9% of our wireless customer base compared to 33.4% a year ago. At the end of Q2, we had 527,000 post-paid mobile customers, more than 115,800 of which were B2B customers. Our prepaid subscriber count at the end of the second quarter decreased 3% compared to prior year. Our fixed broadband base grew 16% year over year to 138,500 subscribers. Q2 service revenue in New Zealand increased 10% versus prior year on an organic basis, which again excludes the impact of foreign exchange and new accounting standards driven by solid postpaid and fixed broadband customer growth, as well as higher prepaid ARPU. At the product level, our postpaid revenues in the second quarter were $49.2 million, an increase of 6% versus Q2 2020 on an organic basis. This resulted from the growth in our postpaid base over the year, particularly in B2B. This was partially offset by ARPU compression of 2% on an organic basis in Q2 over the same period last year, due primarily to lower consumer voice usage, which was elevated a year ago when New Zealand was in lockdown. Our Q2 prepaid revenues of $25.8 million increased 7% versus Q2 2020 on an organic basis, driven by a 13% increase in prepaid ARPU due to improved data monetization. Our New Zealand broadband revenues in the second quarter of $27.1 million grew 24% versus the same period last year on an organic basis due to our 16% larger base and organic ARPU growth of 12% due to reduced promotional discounts and pricing adjustments. Equipment revenue in New Zealand was flat on an organic basis. Our segment adjusted EBITDA for Q2 in New Zealand was $31.7 million which was an 8% year-over-year increase on an organic basis. Our segment-adjusted EBITDA margin in the second quarter was 30.5% versus 31.8% in Q2 2020, as margins in the quarter were impacted by an increased level of advertising and promotion spend year-over-year and higher G&A due partially to the commencement of the new Two Degrees corporate headquarters lease in Auckland. Cost of service increased by 6 million, or 20%, primarily due to an increase in foreign currency exchange. Excluding the impact of foreign currency exchange, cost of service increased due to a higher transmission expense associated with the growth in broadband subscribers. These increases were partially offset by a decrease in combined network sharing and national roaming costs due to the network sharing agreement which commenced in the second quarter of 2020. Sales and marketing increased by $5.7 million, or 52%. Excluding the impact of foreign currency exchange, sales and marketing costs increased 31%, primarily due to an increase in advertising, promotion, and event sponsorship costs as a result of higher campaign expenses in the second quarter of 2021 compared to the same period in 2020 when cost control measures were implemented in response to the COVID-19 pandemic. Additionally, Commission expense increased primarily due to higher amortization costs of incremental contract acquisition costs capitalized subsequent to June 30, 2020, related to NRS. General and administrative increased by 3.8 million, or 23 percent, primarily due to an increase in foreign currency exchange. Excluding the impact of FX, The increase was $1.2 million, or 6%. This increase was primarily due to an increase in salaries and wages mainly associated with the non-recurring impact of a $1.8 million item in the second quarter of 2021, the impact of which was removed from segment-adjusted EBITDA due to the non-recurring nature of the expense. Additionally, there were increases in legal, audit, and consulting costs and increases in office rent expense due to the aforementioned commencement of the new Two Degrees corporate headquarters. These increases were partially offset by a decline in equity-based compensation expense as a result of 1.7 million recorded in the second quarter of 2020 associated with the extension of the expiration of certain Two Degrees service-based share options recorded in the second quarter of 2020, along with declines in bad debt expense attributable to improved collections and the improved credit risk of our customer portfolio. Cost of equipment sales increased by 3.9 million or 19%. Excluding the impact of FX, the increase was 0.7 million or 3%, primarily due to societal restrictions in 2020 related to the COVID-19 pandemic that caused the temporary closure of our physical distribution channels, combined with increases in the volume of sales of higher-priced devices to new and existing subscribers during the second quarter of 2021. Our Q2 capital expenditures in New Zealand were 23.3 million versus 13.8 million a year ago. Excluding the impact of FX, our capital expenditures increased by 7.3 million, or 46 percent, primarily attributable to 5G network investments. Our capital intensity for the second quarter was 22% compared to 17% a year ago when we were in the midst of COVID related societal restrictions. Shifting to Bolivia, we ended Q2 with 1.7 million wireless subscribers. As Brad mentioned, Bolivia entered its third wave of COVID infections early in the second quarter. This has resulted in a year over year contraction of our postpaid customer base. We ended the quarter with 235,200 post-paid mobile customers and 1.4 million prepaid customers. Our fixed LTE product continues to perform well. We added almost 1,700 customers in Q2, bringing our base to almost 24,000 fixed LTE customers in Bolivia. This is a 65% increase compared to the same period last year. Our Q2 service revenues in Bolivia of $30 million declined 10% on an organic basis versus the second quarter of 2020 due to the decrease in postpaid service revenues. This decrease was partially offset by year-over-year growth in prepaid and fixed LTE service revenues, which increased by 2% and 74% respectively. Our Q2 adjusted EBITDA loss of $784,000 in Bolivia declined significantly compared to last year as our reduced revenues were only partially offset by our cost reduction measures. Capital expenditures in Bolivia increased year over year to $6.3 million in the second quarter due to timing. We remain focused on CapEx discipline, with CapEx year-to-date through June of $7.3 million. Moving to our consolidated cash and liquidity position, at the end of Q2, our consolidated cash balance was $63.5 million in cash and cash equivalents and restricted cash. $23.5 million of cash was held by Two Degrees, $25.1 million held by Nueva Tel, and the remaining held at corporate. With respect to our capital structure, consolidated debt at the end of Q2, including $408 million of Trilogy's holdco notes, plus local debt and other, was $674.7 million. At the end of Q2, 285 million New Zealand dollars was outstanding on the senior finance facility in New Zealand. In Bolivia, our debt outstanding totaled 35.5 million, which includes 4.4 million related to prior tranches of the tower sale leaseback, which was closed in 2019. From a consolidated gearing standpoint, net debt to consolidated LTM adjusted EBITDA was 5.2 times at June 30 versus 4.4 times a year ago. Next, a few comments on the planned IPO in New Zealand, where we continue to make progress on our plan toward a listing before the end of the year. First, we continue to believe that the strong operational momentum, scale, and runway for future growth positions Two Degrees well. Secondly, as discussed previously, we see an IPO in New Zealand as an opportunity to accelerate growth in that market and as a deleveraging transaction for Trilogy with the objective of reducing Trilogy debt meaningfully while retaining a significant retained interest in the business. And thirdly, on a parallel path, we continue to work with advisors regarding the Trilogy capital structure post an IPO with a focus on de-risking the balance sheet and optimizing cost of capital. We look forward to providing updates as we progress on these strategic initiatives. And again, any IPO would of course be subject to market conditions. Before moving to Q&A, a few comments on our 2021 outlook. Last quarter, we increased our 2021 growth outlook for New Zealand to 4% to 6% growth for both service revenue and segment adjusted EBITDA. While certain COVID-related risks and impacts remain, financial results and KPIs to date have again exceeded our expectations. As such, We are again revising upward our 2021 growth outlook to 6% to 8% for both service revenue and segment adjusted EBITDA, which excludes any impact of accounting changes and FX fluctuations. With that, let's go to questions. Kate?
spk01: Thank you. Ladies and gentlemen, the floor is now open for questions. If you have any questions or comments, please press star 1 on your phone at this time. If you no longer wish to pose your question, you may press star two to leave the queue. If you are listening by a speakerphone, we do ask that you please pick up your handset for optimum sound quality. Once again, if you have any questions or comments, please press star one on your phone at this time. Our first question today is coming from Jeff Fan at Scotiabank. Your line is live. You may begin.
spk03: Thank you. Good afternoon, everyone. A few questions on New Zealand. First is the success in B2B. Can we step back and assess where you are in your market share or what your estimate of your market share is in the B2B market right now? And can you talk about what's driving the growth? I think, Brad, you talked about the strength of the network performance. Maybe that's one area that's driving. I wonder if there's anything else. It is just customers starting to realize the quality of the network that you're providing versus the share that you have and who you're taking share from in the B2B. And then the second part is related to the fixed wireless. What do you think is the addressable market for that service? Because, you know, as I sit back, you think about the market, there is a a fiber or wireline kind of option, but the rates are too high, so it's kind of a weird situation that's going on that's not encouraging perhaps the right network. But maybe talk about the addressable market on fixed wireless, and maybe the second part is whether there's going to be any updates on wholesale rates related to Chorus. Thanks.
spk05: Hi, Jeff. It's Eric. I'll take the first piece a bit on market opportunity. Brad can talk about drivers and the fixed wireless element. First, sitting here today, mid-single digits in terms of our penetration in the B2B space compared to high teens on the mobile side. So as we look ahead, no reason there can't be some convergence over time. From an overall service revenue mix for 2020, our business revenue was about 13% of total service revenues. So again, low as a percentage and just scratching the surface. As Brad mentioned, the base is up about 24% year over year, and gross ads for the year now representing about 50% of our gross ads are coming from B2B customers as that pipeline continues to grow. So that's really providing a nice diversification to the revenue streams as well. And I'll turn it over to Brad to comment a little bit on the drivers.
spk00: Yeah, no, great, Jeff. I think you were about to Six questions in there. I've got notes done. I'll try and address them both. But I think you touched on one of the key points. We referenced earlier, you know, the transition from the roaming agreement that we originally had, you know, to the infrastructure sharing agreement that now has replaced it. You know, I can't overestimate what impact that has had on the experience from a customer level. I think that historically the perception of an inferior grade of service when customers would go outside of the core service areas was not ideal at all, and it's improved dramatically to where there's parity. That's been particularly important in the SME space and in the enterprise space. Secondly, you know, quite frankly, we've got great leadership in that space now. Andrew Ferregray, who came on board, you know, probably I guess about 18 months ago or so, has completely, you know, revamped the organization from top to bottom, you know, made changes where they needed to be made, put the right amount of focus on it, has really, you know, looked to establish strategic partnerships with providers of services that are outside of the core services that we provide. And so when it comes to moving from the smaller SME, you know, spaces more to the larger companies and to the enterprise space, you know, we can now intelligently talk to our customers regarding their needs on LAN, WAN, cloud migration, and really provide a, you know, a much more comprehensive solution to what the customers actually need. In regards to the wireless, a couple of things on that. You know, somewhere in the neighborhood of 25% of the broadband customers in New Zealand are still using copper, you know, today. And as you recall, Chorus operates the fiber network today. So when a customer wants to migrate... from a copper, from ADSL or VSL to fiber, while we may make the sale, the actual provisioning of that service then gets turned back over to Chorus. So literally, you know, it could be a week, it could be two weeks from the time a customer decides to make that change. by the time Chorus gets their contractors out there to either tear up the garden or the driveway or to somehow facilitate the actual provisioning of the service. With wireless, literally the provisioning of that service can be done literally within a day or two. It truly is a plug-and-play scenario for the customers. And to a large number of customers that are upgrading from copper, You know, it's a service that still provides the speed and the capacity that's satisfactory and addresses all the needs. I think that in terms of overall share, I would note that publicly, our competitors have been announced in terms of what their objectives have been. I believe Spark has indicated that they expect over time up to 40% of their existing broadband customers will be utilizing broadband via wireless. Vodafone has been pretty aggressive in their forecast as well. We have not been specific in terms of what our expectations are going to be. But I think it's fair to say that overall, on an overall market basis, at least 25% to 30% of the broadband business going forward will be provided with wireless. I would note that today, while our sales of wireless broadband have increased dramatically over time, this is still a service that today we're providing on 4G, 4.5G, in terms of the technology involved. their spectrum comes into play. And so there's a, you know, there's certainly a capacity, a capacity limitation that we would run into at some point. That being said, we're on track with our 5G deployment, and I think that that will pick up, you know, that will certainly pick up where any spectrum limitations associated with 4G, where we would top out at 4G from a capacity standpoint. And most significantly, the access charge that we pay from Chorus, well, it's eliminated with a wireless broadband service offering. The really only significant difference as we sit here today is the actual cost of the 5G broadband modems are significantly more expensive than the 4G modems that are in the market today. That being said, reducing that $40, $45 access charge, it's pretty easy and pretty quick to recover the increased expense that's associated with the higher price modems on 5G.
spk03: Thank you.
spk01: Thank you. Once again, ladies and gentlemen, if you have any questions or comments, please press star 1 on your phone at this time. Our next question today is coming from Riley Gray at RBC. Your line is live. You may proceed.
spk04: Thanks, and good afternoon, everyone. It's Riley here. Can you just give us an update on the current competitive environment in New Zealand in terms of market share and the degree of promotional intensity you're seeing now on the mobile side. And then your thoughts on the announcement from the New Zealand government that may be coming later this week. I know 2022 has been sort of the mantra of the government, but just your thoughts on if we see something earlier that could save your guidance as well as, you know, give the promotional intensity in some other markets that have experienced similar reopening thus far. We've seen a bit of an uptick there. So just kind of your thoughts on what we might see if the reopening is a little bit earlier than previously anticipated.
spk05: Hey Riley, it's Eric. It was breaking up a bit. What we heard was describing the competitive environment in New Zealand and thoughts around reopening. Brad will take that and then feel free to reiterate pieces we missed.
spk00: Yeah, no, great, Riley. You know, I would characterize, you know, New Zealand, you know, today is business as usual. There was some pretty aggressive, you know, promotional activity going on, particularly in the broadband space a couple of quarters ago. But I think what I would call a degree of irrationality has come back into the market today. I think that the subdued retail traffic is not unique either to us specifically or to the other carriers. I think that's a general reflection of retail overall in New Zealand. I think that the ongoing economic impact of the borders being closed and the impact that tourism has on the economy is sort of settling in as we see today. It's going to take, you know, we have been doing a fair amount of activity, promotional activity, in trying to stimulate and get back to our pre-COVID levels. You know, but to date, I think that there is still a lack a lack of migration from customers moving, you know, moving back and forth. I think from a, you know, where's that share coming from, I think it's actually kind of specific by product, by product line. You know, most recently as we look at, I mean, obviously we've got porting activity you know, that occurs, you know, every month and that we look at. And we've been actually seeing an increased amount of our share actually coming from Spark on the postpaid side, which is a bit different than what it was historically in the past. I think from my perspective what that's really speaking to is the parity and the quality that we now have in the network. I think the company still, to some degree, suffers a bit from perception of network quality that existed in the early years of the business when we were relying on the Vodafone 3G roaming arrangement. But I think that over time and with increased marketing efforts, we're slowly overcoming that. And so now I think that there is parity in the network quality now. There is generally parity in pricing across the various components. And so now it's really about investing into the brand, investing into the purpose, continuing to sort of strengthen our messaging and our mantra, which has basically been a fighting for fair for all the Kiwis. you know, that are there. I think that, you know, culturally, you know, New Zealand likes the underdog, if you will. And I think that as the challenger brand in New Zealand, as we've continued to invest in both our brand and in the network quality, you know, we're starting to become, you know, a preferred provider of service. And we see nothing that's going to really alter that across the board.
spk04: Yep, sorry for the connection, but you guys got it. Thank you.
spk00: Thanks, Riley. Great. Thanks, Riley.
spk01: Thank you. Once again, if you have any questions or comments, please press star 1 at this time. We have no further questions in the queue at this time. Ladies and gentlemen, this does conclude today's events. You may disconnect at this time and have a wonderful day. We thank you for your participation.
Disclaimer