Good morning. On behalf of Telecom Argentina, I would like to thank everybody for participating on this conference call. The participants of today's conference call are Roberto Nobile, Chief Executive Officer, Gabriel Blasi, Chief Financial Officer, Fernando Balmaceda, Director of Investor Relations, and myself, Solange Barthe Dennin, Manager of Investor Relations. The purpose of this call is to share with you the results of our second quarter, ending June 30, 2020. If you would like not receive our press release or presentation, you can call our Investor Relations office to request the documents or download them from the Investor Relations section of our website, located at www.telecom.com.ar. This conference call and presentation is being broadcasted and can also be replayed through our Investor website at institutional.telecom.com.ar/investor. I would like to go over some safe harbor information and other details of the call.
We would like to clarify that during the conference call and Q&A session, we could mention certain forward-looking statements about Telecom's future performance, plans, strategies, and objectives. Such statements are subject to uncertainties that could cause Telecom's actual results and operations to differ materially. Such uncertainties include, but are not limited to, the effect of ongoing industry and economic regulations, possible changes in the demands for Telecom's products and services, the effect of potential changes in general market and/or economic conditions in legislation, and the impact of the outbreak of COVID-19 on the global economy, and specifically on economies of the countries in which we operate, as well as on our operations and financial performance.
Our press release, dated August 14th, 2020, a copy of which was included in our Form 6-K and sent to the SEC, describes certain factors that may affect any forward-looking statements that could be mentioned during the call. The company has reflected the effect of the inflation adjustment adopted by Resolution 777/18 of the Comisión Nacional de Valores, the CNV, which establishes that reexpression will be applied to the annual financial statements for intermediate and special periods ending as of and including December 31st, 2018. The reported figures corresponding to the first quarter included the effect of the adoption of inflationary accounting in accordance with IAS 29. In this presentation, we will also include figures in historical values, which are easier to understand. Our press release complemented by our earnings presentation. The audience should read the disclaimer contained in slides one and two of the presentation.
The agenda for today's conference call is described in slide three and includes our business and financial highlights. We will end the call with a Q&A session. Let me pass the call to Gabriel Blasi, our CFO, who will start with the presentation.
Thank you, Solange. Good morning and welcome to everyone. Slide four shows an outlook of the company figures for the second quarter 2020. During the first half of 2020, Telecom's revenue totaled $1.8 billion. The revenues measured in constant pesos decreased 3% year-to-year. EBITDA totaled $679 million, implying 35.5% EBITDA margin, growth in constant pesos 5.3% year-over-year. Our mobile subscribers in Argentina amounted to 18.8 million, remaining relatively stable when comparing with the previous quarters. Broadband and pay TV clients increased slightly, totaling around 4.1 million and 3.5 million respectively. Fixed voice subscribers, without considering IP telephone lines, amounted to 3 million. Thanks to our successful commercial strategy focused on the bundling and upselling of our products, we currently have 1.8 million convergent unique customers, with 43% of our broadband customers having a mobile bundle. We continue with slide five, presenting our new IT transformation projects.
During June, we launched our digital core as part of our backend transformation program for apps. This has enabled us to operate under unified, convergent, and efficient system and processes for the back office. With implementation of SAP S/4HANA and Ariba, we have accomplished this objective in our operating model. Based on best market practices, it allowed us to work in a simpler and more collaborative and transparent way. More than 6,000 employees were trained through 150 virtual webinars and more than 50 virtual internal courses. Regarding our main BSS transformation project, FAN, we have been able to complete the third and fourth migrations of mobile customers, adding 2.5 million prepaid and postpaid clients during May and August respectively. Currently, a total of 2.8 million customers can enjoy this new digital experience, supported by 2,500 commercial advisors.
We are also planning to end 2020 with all of our mobile customers migrated to our new CRM and to have our quad play MVP ready by October. Slide six shows you the evolution of our service revenues. Service revenues total almost ARS 124.7 billion, decreasing 1.4% in real terms versus same period 2019, in a period when inflation reached a 42.8% year-over-year. The share of communication services in the national CPI is approximately 2.8%. Our revenue breakdown as of June 2020 shows an increase in mobile revenue share and a lower share of Pay TV revenues when compared with the previous quarter. The breakdown results as follows: mobile revenue 38%, broadband revenues 22%, Pay TV revenues 20%, fixed telephone and data 15%, equipment sales 5%. Our main drivers of growth are explained on slide seven.
We have been able to continue reducing the gap between inflation and real ARPU figures, which currently is around 1% below inflation, while being able to keep a steady of our customer base. Postpaid mobile, broadband, and our IP video platform called Flow are the main pillars of our business. In the first half of 2020, postpaid subscribers accounted for 41% of our total customer base. The company has registered positive subscribers inflow during the first six months of the year, reflecting our effort to optimize the quality and capacity of our mobile network. As mentioned before, the growth in this segment has been mainly supported by our convergent offers to cable TV and Internet subscribers that were not mobile clients of the company before, showing a net result of 27,000 customers coming from our competition in the first half of the year.
Mobile Internet usage has also increased, reaching an average of more than 3.9 GB per user per month in the first semiannual period to 2020. In addition, there has been an important growth in broadband speed, considering that 55% of our total subscribers have speed between 50 MB and 300 MB, compared to 18% by the end of last year. Our product Flow has delivered solid results. We have almost 1.1 million Flow boxes inside homes that is advancing toward the objective of network digitalization. We keep on increasing the speed and capacity of our broadband customer base, leveraging on our strong HFC network and responding to the higher usage for fixed networks generated by COVID-19. In slide eight, we describe latest regulatory decisions taken by the ENACOM and the Argentine Central Bank.
In May, due to the COVID-19, our industry has agreed jointly with ENACOM to freeze tariffs of our products until the end of August 2020. Concurrently, all companies in the industry were not required to increase salaries until August 2020. Both inclusive plans and reduced services are being provided to clients. In the case of the reduced services, they are only provided to clients who have not paid their service on time. It's worth mentioning that during March 2020, the executive power issued a decree, which determined the temporary suspensions of the interruption of fixed mobile telephone, internet, and cable TV services, among others, in the case of non-payment of three bills by a certain group of clients until the end of September 2020. This was then extended to six bills until December 2020.
As of June 2020, clients with reduced services represent less than 2% of the company's subscribers base. Since the products have very limited capacity, as of June, we were recovering said clients at a rate higher than 60%. On May 28th, 2020, the Argentine Central Bank decided that companies which have liquid assets abroad must first use said funds to pay their dollars commercial and financial debt, thus not allowing the local companies to access the FX market, official FX rate, unless they can prove that they do not have any liquid funds outside Argentina. Due to the above, the company decided to initiate the refinancing of its financial debt, which will be explained later in this presentation. I will now pass the call to Fernando Balmaceda, who will go over our financial performance.
Thank you so much, Gabriel. In slide nine, we show the evolution of local inflation. As of June 2020, the year-over-year increase in inflation has been 42.8%, while during the second quarter of the year has been 5.4%. Regulated prices have increased 25.2% year-over-year and remaining flat during the second quarter 2020, thus generating an increase in the general inflation index. The breakdown that we are including shows that the most important weight in the index comes from food and beverage, transport and clothing, among other items. While the share of communication service in the CPI amounts to a very small percentage, which is 2.8%. Going to slide 10. For the first half of 2020, consolidated revenues on nominal terms grew by 43%, reaching almost ARS 125 billion.
When analyzing said figure adjusted by inflation, revenues amounted to more than ARS 131 billion, showing an increase of 3% in real terms. The company has been trying to offset the inflation impact on its revenues and costs. Service revenues showed a 45% nominal increase, while mobile revenues grew more than 8% in real terms when comparing the first half 2020 with the first half 2019. In the case of Pay TV, revenues related to local soccer league programming have not been generated, considering that activity has been suspended. EBITDA increased by 54% year-over-year in nominal terms, thus generating an EBITDA margin of 37%. EBITDA margin in real terms was 36.5%. The company performed well in terms of cost controls. Operating costs before D&A decreased on 7% in real terms versus the first half of 2019.
The company performed an effective cost management, and almost all cost lines experienced a decrease in real terms, with exception of interconnection and distribution costs, which increased mainly due to the rise in FX rates and bad debt expenses that were higher as a consequence of the general economic situation. In slide 11, we show the company's EBITDA and the impact of the different components of revenues and costs. With a positive evolution of handset costs, which decreased 34% in real terms, mainly by a lower number of sales. Operating costs were also 7% lower in real terms. Operating efficiencies were obtained both in programming and content costs. There were no costs related to the local soccer league because it has been suspended. Administration costs also registered a good performance, decreasing 9% in real terms.
Commercialization expenses remained stable, mainly as bad debt expenses, including the provision, increased above inflation impacted by the deterioration of the general economic context. Final result was a 290 basis points increase in EBITDA in real terms when compared with the first half of 2019. In slide 12, we show the evolution of our collections and non-performing debt. Collections through digital channels have increased to 65% of total collections from the 50% observed at the beginning of the year. Additionally, the gap of real collections versus our forecast has decreased substantially. At the beginning of the COVID-19 lockdown, the level was almost -30% . Currently, our collections are at a normal level and have been possibly influenced by extraordinary collections in our B2B business. During our second quarter 2020, non-performing debt in retail business increased mainly due to the effect of the COVID-19 lockdown from 2.4%-2.7%.
Since June, said trend is moving to more normal levels and has been benefited by the recovery rate of our reduced service clients. In slide 13, we can see the company's operating income total almost ARS 14.5 billion. The EBITDA increase in cost as measured in unit is explained by a lower increase in D&A and disposals and improvement of tax assets, vis-à-vis the increase in EBITDA 4% in real terms year-over-year. Operating margins reach 11% of consolidated revenues, while in historical figures, the same margin has increased to 24% from 20% in the first half of 2019. Net income in the first half of 2020 decreased more than ARS 7.6 billion, mainly reflecting FX losses due to the depreciation of the peso and higher interest expense in the net finance results. In slide 14, there is a summary of the company's investments during the first half of the year.
Telecom has invested almost ARS 34.4 billion, including rights of use of assets, being this amount 34% lower when compared to the same last year's period. Said decrease in CapEx is mainly explained by strategy to protect the company's cash position. Technical CapEx were mainly composed of installations and customer premise equipment or CPE. The balance was allocated to network and technology, and for our international operations, both in Paraguay and Uruguay. During the second quarter of 2020, more than 39 new mobile sites were deployed. Moreover, we continue to increase the capacity of our HFC network, mainly through segmentation of areas, focusing particularly in the AMBA region in order to respond to our customers' high broadband usage due to the pandemic. 2,400 FTTH and 2,301 GW HFC blocks were enabled.
Additionally, we completed the phase I of our cloud foundation initiative by uploading a set of business applications to the Amazon Web Services. In slide 15, we describe our cash flow generation when comparing the first half of 2020 with the first half of 2019. During the first half 2020, the operating free cash flow amounted to approximately ARS 361 million. The increase in EBITDA and the reduction in CapEx mainly explain the additional ARS 79 million in free cash flow when compared to the first half of 2019. Turning to slide 16, we show our key figures for the last 12 months as of June 2020 in constant measuring unit. Company's revenues amounted to more than ARS 265 billion, while the EBITDA amounted to almost ARS 90 billion. EBITDA margin was 34%. Our gross debt amounted to ARS 183 billion as of June 30, 2020.
The company has been able to generate an important amount of cash and equivalents, having a net debt of ARS 131 billion, reducing our net debt in real peso terms when compared with December 31, 2019. Our net debt to EBITDA ratio was at 1.46 x. Slide 17 shows the breakdown of our financial debt. Total outstanding debt as of June 30, 2020 amounted to almost $2.6 billion. As mentioned, the Argentinian Central Bank has not allowed companies to access the FX market at the official FX rate for commercial and financial debt payments in foreign currency, unless they can prove that they do not have any liquid funds outside of Argentina. This was the main reason why the company decided to initiate a liability management strategy that we will cover in the following slide. Slide 18 summarize the latest financial transactions the company has done.
On August 3, 2020, Telecom concluded an exchange offer of the outstanding 6.5% notes due in 2021. Holders validly tendered 362.2 million of notes due 2021. The acceptance rate was 77.74%, high enough to demonstrate our solid credit profile and structure of the exchange offer. An additional amount of $135.4 million of notes due 2025, which we consider to be new money, was raised to repay our loan with Deutsche Bank, London Branch and CPPIB Credit Investments Inc. In summary, the company issued $388.9 million of new amortizing notes due 2025, with an 8.5 semiannual coupon. Due to the above, the company has considerably optimized its capital structure. Our next step will be to extend the amortizations of our multilateral loans, and we have already started with this process. In slide 19, we show our pro forma maturity profile as of June 2020 after the exchange we just mentioned.
Our maturities in U.S. dollars are in the range of $100 million-$500 million between 2021 and 2022, and are reduced until the maturity of our 2026 notes. Having concluded with the presentation and before going to Q&A session, let me pass the presentation to Roberto Nobile, our CEO.
Hi, everyone. Just to finish the presentation and open to questions. We just would like to highlight that the COVID-19 pandemic has been like a catalyst for the company in its digital transformation path. Not only because we were able to sustain and hold the operation and the business, but also grow significantly in terms of engagement. If we take a look at Flow, our IP video platform, we reached 9.5 hours of average user per customer. That's an amazing number considering the volume of transactions that are passing through our platform. We hit 126 million views. We grew 30% in terms of users on the OTT platform. We grew 66% in terms of hours in VOD on our app, on our OTT platform too. More than 31% growth of hours in VOD in our box or set-top box video platform also.
We have also been able to keep our transformation project on schedule. As Gabriel was mentioning, we were able to keep running our SAP project, and today we have all the ledger in one ERP. It's SAP S/4HANA. We were able to migrate more than 2.8 million mobile customers into the new Salesforce platform, and that's a great achievement. We keep on rolling migration wave throughout the year. We have given the company also a better outlook for 2020 and 2021 debt maturity, reducing significantly the debt maturing next year. We have managed cash flow in a very conservative way to deal with the difficult business context.
To ensure the company's sustainability, no matter the Argentine context as well. Finally, we have been able to keep our customer connected in these critical times, which is something that we are proud of. Now we can open to questions.
Hello, everyone. We will just continue with the Q&A session. Before going to the Q&A session, please, we would like to remind you that you can address your question to the Q&A session, which we open immediately. Please send a message to IR Telecom Argentina through the Q&A menu, identifying yourself and stating that you have a question or alternatively, use the Hand button to let us know that you want to formulate a question. We will let you know when it's your turn to speak, and we'll unmute you so you can proceed with your question. Thank you very much. The first question we have is from Andres Coello . "Hi, in this regard to debt denominated in dollars, are you using the official FX to convert it into Argentine pesos? Can you remind us how many dollars you can actually buy at the official FX?
What is the accurate effect at which you can buy dollars?
Okay. Thank you for the question. Well, all the accounting for the company of all the dollarized assets are accounted using the official foreign exchange rate, unless those specific assets might have a market price. For instance, if the company buys any security, you use the market price of the security. All the rest of the dollar assets are accounted at the official foreign exchange rate. Regarding the amount of dollars that the company may get from the local FX market, from the MULC, as we call it here, theoretically, it is unlimited in terms of, as far as you comply with the regulations pertaining what type of payment are you willing to make, you go to the market, and the market provides mostly with the authorization of Banco Central.
The restrictions are based on what type of conditions the payment must meet to be able to be channeled through this market. For instance, all the financial payments require that the debt should be registered prior with Banco Central. All the commercial payments have to meet certain technical relationship between the goods. For instance, just to explain this in brief, and we can go over this in more detail in a separate call if you wish. You cannot anticipate a significant amount of import. As far as you comply with the obligations, there is no problem in accessing the foreign exchange market.
Okay. We have the following question from Pedro Soares, who asks, "On incremental CapEx, the company had canceled in May. Does the company plan to restore the extra CapEx? How is that unfolding?
Yes. Well, definitely the conditions that made us take that decisions that were related to the general situation, really, it was very difficult to precise in March this year what was going to be for the company, the outcome of the pandemia, plus all the uncertainty that was derived from the Argentinian negotiation of the debt. With a much clearer situation regarding both issues, Argentina has already reached an agreement on the sovereign debt. On the other hand, we have a clear picture of how the evolution of the company is behaving with the quarantine process. We decided to retake the original amount of CapEx, and also we are considering some additional amounts regarding some aspects that are related to the new normality, let's call it that way, that might require a different type of attention.
At the end, we think that our CapEx will be over $550 million for sure, and very likely over $600 million. All this, of course, calculated, as I mentioned, to the foreign exchange rate, which is the one that we effectively account and effectively pay.
We have Agustina Isidro from AR Partners. Agustina, you can go ahead with your question.
Thank you. Hi, everyone. Thank you for taking my question. I would like to ask about the status of the price update in your different segments. The price freeze expires by the end of the month in Argentina. How are negotiations evolving with ENACOM?
Thank you for the question. We have already communicated to our customers a price increase that in average is around 10.5%. That's going to be from September 1st on, and we have already communicated that to our customers with one month in advance because the local law requires us to do that. We have the negotiation with ENACOM that was between the March and August 30. That was the timeframe where we have agreed upon freezing, let's say it that way, the prices. We are able to increase them from September 1st.
Now, we have the following question from Daniel Aljure, from Banchile, who asks, "Do you have a specific leverage target for the short, medium term? Any additional initiative you may be working on in order to tackle the upcoming maturities?
Okay, thank you for the question. Yes, definitely. The company, remember, has a long-term target in terms of relationship debt to EBITDA around 2 x. As Fernando explained, we are below that. For the time being, we do not think that it's going to be a very significant change in that equation. Regarding the next steps to keep up with the maturities, we have already refinanced more than $600 million of the maturities, especially of next year. As you saw from the presentation, we have already started negotiations with most of our banking creditors. Meaning that we, I will say at this stage, we have reached an informal commercial agreement with our banks, and we still are having additional conversations with multilateral agencies to bring on the same package and restructure the rest of the maturities.
Having said that will mean that for the next two years, the company would have reduced the total amount of maturities in half, and that is considering the remains of the 2021 note that we exchanged recently. Really, the situation in terms of cash flow for the company or requirement of financial dollars for the company, has changed significantly, and also that implies a significant advantage for local interest rate, too.
The following question we receive is from Santiago Petri from Templeton, who says, "Hello, thanks for the presentation. Could you please repeat the explanation for the difference in the operating margin between historical 24% and inflation 11% adjusted figures in chart 13?
What does it mean is that the difference between the two is the effect of the inflation adjustment. Historical values, meaning with no consideration on inflation, has a growth of 71%. When you calculate the same amount operating income related to the inflation figures, as you have costs that are related to a different base your income is not necessarily adjusted completely by inflation, but by your price adjustment that there is in this case. The reality here is that the company, during this process, went into a very successful, I would say, cost control. All the situations of becoming digital, as Roberto has mentioned, and having a very significant part of our population working from home means that, for instance, we have five corporate buildings, three of them completely closed. Also additional cost savings which are relevant have been taking place as Fernando explained regarding the football.
You have a reduction in the sale of devices, which concurrently implies less cost too. There are several lines of cost that were very successfully managed, and as a result of that, the EBITDA margin grew significantly, and operating income also had a good behavior on this. Remember that 10% of our revenues, which are related to the corporate business, are adjusted by dollar income.
The following question we have is from John Maku. What it says, "How much of the cost cuts are one-time in nature? [audio distortion] How sustainable is the margin expansion you experienced in second quarter?
Part of this is difficult to answer because it's more related, for instance, to the evolution of foreign exchange rate and the ability of many suppliers to pass through inflation to us. I will say that in terms of the improvement of margin that we already have, we think that, not at the accounting level, but on the MIS information, we grew about 6 points of EBITDA margin, which we think that at least three of them would be reduced when the quarantine process reopens. I think, this is my personal opinion, and it's yet difficult to say, that probably 1 or 2 points are going to be there, and our intention is to do so. We are really doing a very intensive cost control and learning for the cost reductions that we achieve in this process to keep most of them up after this situation changes.
The following question we have is from Cesar Medina from Morgan Stanley. Hi. Would like to hear your thoughts on competition on the fixed business since some of your competitors are delivering stronger growth rates in pay TV and broadband.
Thank you for the question. On pay TV, our market share remains the same. Even though there are competitors working on the video side, we are performing very well. That's not a problem so far. On the broadband side, we have a very strong competition today. We have already mentioned that in previous talks. We have an HFC network. That's a hybrid coax and fiber network, where we have HFC broadband customers. We have the old copper network, where we have xDSL customers. We are losing, and probably we have shown the figures. We are losing customers on the xDSL network because of a stronger competition with a better product. We are retaining our market share on our HFC networks.
As long as we are able to upgrade our copper networks into FTTH networks, that's part of our CapEx plan for the future, we will be able to increase our market share on those areas. As long as we don't keep on with the FTTH deployment, that's not possible. Anyone that interrupts in an area with a copper network only, it's difficult to compete. That's probably the way. Most of our customers are on HFC, and on HFC, we are growing. For example, in last month, we are growing more on HFC than what we are losing on the copper areas.
Thank you, Roberto. The following question is from Nick Ivanov. What it says, "Is the U.S. dollar amount that the company can get on any day from the Central Bank limited, even if it is needed for interest payment or debt amortization?
No. No, it isn't. What we are doing, I will say as a sanity issue, not as a requirement, we will not expect to the last day, and we try to make our acquisitions in two, three times to create the minor noise that we can on the market.
Thank you, Gabriel. The following question is from Rodrigo Villanueva. What he says is, "Is it possible to break down how much of the OpEx savings that you have had are related to frozen salaries and software commercial activity, and how much of the OpEx savings could be perceived as sustainable?
Just to add, on the salary line, our salaries were increased between 40.5% and 42.5% on the period July 2019, June, July 2020. 70% of our staff belongs to a union, and we have agreed with the unions the salary increase, and we completed the negotiations, and that was between 40% and 42%, depending on the union. We have not had any salary freezing during this last year. Our approach is to move our salaries at the same rate as we increase our prices. That's the approach, and that's the negotiation we are running today with the unions together with ENACOM.
Thank you. The following question is from Chelsea Colon. She says, "Can you please discuss operations in Paraguay? Mobile customers are down 5% in the quarter. How is the situation evolving, both in terms of the pandemic and competitive dynamics?
It is true. Paraguay is struck by the pandemic also. We have been hit by the pandemic. Most of our customers are prepaid, and prepaid customers, as well as in Argentina, are not recharging as they often do. That's one of the temporary reasons why customers are down. On the other side, we were able to deploy 16,000 square blocks of FTTH in Paraguay, especially in Asunción, and we have hit more than 100,000 new customers on broadband on FTTH services. That's a great job we're doing. We're achieving probably around between 25% and 30% of market share coming from zero. We are doing a very good job, and we are going to keep doing that.
Thank you. The following question we received is from Gustavo Lana. He says, "Hi. I would like to ask if you could provide a breakdown by currency of cash and equivalent, and how much is held in overseas banking accounts.
Hi. Thank you for the question. Well, as we explained regarding the new regulation, the company has, in dollars, about $40 million, which are held now in Argentina. We brought that money within the country to comply with Banco Central regulation. No other currency is held abroad. As part of the refinancing process that we are currently developing, we have established a structure that has no relationship with the company, that has paid the cash consideration for the exchange of the bonds, and will also use the funds required for completing the refinancing of our banking debt, meaning that no additional funds are going to be required from that part. On top of that, we have about $ 300 million equivalent dollars in pesos in Argentina, which are split between $ 200 million in pesos specifically, and an equivalent of $100 million held in dollarized securities.
All of that is held within the boundaries of the country. What the company did was under this new regulation of Banco Central, was use all the funds available to strengthen balance sheet, changing the maturity profile with its creditor. Now we have plenty of cash to operate the company within the boundaries of Argentina.
Thank you. We have a request from Alejandra Aranda. Alejandra, you can go ahead with your question. From Itaú.
Roberto, Fernando, and Solange, congratulations on the debt deal. The communication was a little bit tricky. Maybe you answered this, could you talk a little bit about the tariff increases by segment? How are customers behaving? If you're having some pushbacks to increase tariffs or if customers are looking for upgrades, and then if you have a CapEx guidance for the rest of the year.
Hi, Alejandra. On average, it's 10.5%. On mobile, will be 10%. We have a very thin gap between 10% and 12% or 13% any other service. On average, it's 10.5%. There's no change by segment. We have gone through a very flat increase for all prices and products, except the reduced product that, by definition of ENACOM, cannot be increased until October.
Okay. The following question that we have is, there was one question missing from Rodrigo. It says, Rodrigo Villanueva from Merrill Lynch, which says, "With OpEx down by around 5% year-over-year in real terms for an EBITDA margin at around 37.9% or more than 330 basis points higher year-on-year.
Repeat please.
With OpEx down by around 5% year-on-year in real terms, for an EBITDA margin at around 37.9% or more than 330 basis points higher year-over-year. It is possible to break down, I believe that we've already answered this. Is it possible to break down how much of the OpEx savings that you have had are related to products and tariffs and so far commercial activity?
We already mentioned this. As I mentioned, Rodrigo, just to give you some color in general terms, we think that about half of the improvement is related to the pandemic effect, to the quarantine, and will be much difficult to keep. The other half is something that we think that we are doing our homework. We will try to keep on staying.
The following is from Rodrigo, "Regarding salary increases, do you expect to raise compensation and benefits from September? If so, how much? By how much?
I have already said it's very possible with price increases.
The following question, it came from Austin Favale, that says, "Do you expect any other price increases for the rest of the year apart from September increase, or you also need to negotiate with the ENACOM?
We will be monitoring inflation rates and our own inflation of our costs and OpEx. We will need to understand what's going on. If we see the inflation as is right now, with this 10%, we are keeping track of inflation. We are not going over inflation, but we're keeping track, a very close track of inflation year to date. Nobody knows when the quarantine will be finished, how will the business context start developing September on. We need to understand where we are going and see, and we will do the corrections that we need as long as we know them.
Another question from Austin, that was already mentioned during the presentation. How many subscribers do you currently have on the inclusive and reduced services? We mentioned that was less than 2%.
Less than 2%, yes.
In the case of Chelsea Colon, she asked, "What is the CapEx guidance for the rest of the year?
Chelsea, in total, thinking of course, this is to some extent, might be altered on the margin because of the foreign exchange rate evolution, but assume something in the range of ARS 600 million probably.
Yes, it will depend on the ability to Most of our CapEx is imported goods, so it will take time to bring goods into Argentina. Once we have decided to move forward with the CapEx, it's not only money, it's only time, and we can be around ARS 600, but we could be a little short if we cannot bring things on. That will be a carryover for the next quarter of 2021.
Yes. Sorry, that's for the total year. The ARS 600 is for the total year.
We have no further questions, so we would like just to thank you for participating in our fourth teleconference call, and please do not hesitate in contacting our Investor Relations department for any further inquiries you may have. Good morning to all, and have a nice day.