Good afternoon to all, and thank you for waiting for us. Welcome to the earnings call of the first quarter of 2024 of Unifique Telecomunicações SA For those who need simultaneous translation, we have this tool available on our platform. In order to access it, click on the interpretation button with the globe on the bottom of the screen and select your language of choice, English or Portuguese. For those who are listening in English, all you need to do is activate English and original audio. This video conference is being recorded, and it will be made available on the website of the company of ri.unifique.com.br, where the full call will be available. You can download the presentation also on the chat icon in English as well. During the presentation of the company, all participants will have their microphones off, on mute.
During the questions and answer session, we will open the microphone. In order to ask questions, click on the Q&A icon on the bottom of the screen and write your question to join the queue. When your name is called, we will unmute your microphone where you can activate your microphone to ask questions. We ask that all questions are made at once. We'd like to highlight that the information contained in this presentation and other declarations that may be made during the teleconference related to business perspectives, transactions, and operational goals and financial goals of Unifique Telecomunicações S.A. are based on premises of the company, as well as based on information currently available. Future projections are not the guarantees that they will happen. They involve uncertainties that are beyond our reach in the future, so it depends on circumstances that may or may not occur.
General economic conditions and market conditions and other operational sectors may affect the future performance of Unifique Telecomunicações S.A. and may result in results that are different than the projections. Today, we have the presence of the executive board of the company, Fabiano, CEO, José Wilson, financial director and of investor relations, and [Guilherme Vaillanti], also responsible for investor relations. I pass the floor to Mr. Fabiano Busnardo.
Good afternoon, everyone. Thank you so much for your presence and for being in our call. We are going to start with the subject of Rio Grande do Sul, where Unifique has an important operation in Rio Grande do Sul that is undergoing a very severe tragedy, one of the most difficult moments that has ever reached our country. At the peak of these floods, we had more than 3,500 families that were disconnected from the internet.
After a lot of work with our employees really going over and beyond, today we have 15,000 subscribers. There are still some regions in Rio Grande do Sul that have no electrical energy, that have no power. There are regions where we still cannot get to there to carry out maintenance for optical and external cabling that is around 2% of our base of subscribers. In terms of harmed infrastructure, we had six routes, backbone routes harmed, six PoPs, which are the technical areas of equipment that were harmed. A single store was flooded, and we did not lose any cars or any vehicles that carry our mobile equipment. None of our vehicles were affected. We also had the concern to send a few trucks with basic items such as water. Until last week, they had no water.
Now it's normalizing, but up to last week, people were not able to access water. We were able to send water, food, hygiene, and clothing. We are also supporting 32 families of our employees who were affected at some different levels. Some lost their entire home. Some of their homes were flooded, but not as severe. We are supporting all of our employees. We installed in several shelters Wi-Fi so the people who were there could have internet and talk to their families around Brazil. We also made a decision to give them their extra salary of their 13th salary so that they could be able to take care of themselves. We had to acquire seven trucks, 4x4 trucks, because in most of the locations, normal cars are not able to get there.
We also had to acquire two boats to accelerate the maintenance. We sent 55 technical teams to Santa Catarina to help establish, reestablish the services as fast as possible. We also were able to send. Fortunately, although we were strongly affected, we have a good support and a buffer of equipment. Our distribution center is in Santa Catarina in Timbó, so we were able to send trucks with material there to reinforce all of the technical equipment. We were able to activate new backbone routes, three new ones to substitute the ones that we are not able to recover until now. These routes will remain where they are even after the situation is normalized. We will have more options for the backbone routes. We also have the capacity for four more backbone routes. We will be increasing our supply of the backbones.
We also are undergoing a technical cooperation process with other ISPs, with Vero Brazil, TecPar, [Junetti], everyone. All of the teams are working together to help each other out so that we can recover all of the loss and recover from this catastrophe as soon as possible. I think on this, that's all I have to say, and I'll pass the floor to José Wilson, who will give you our updates on our numbers.
Good afternoon, everyone. Thank you so much for being here at our earnings call. On the first slide, the highlights from the first quarter of 2024. What do we have? In the first quarter of 2024, we were able to reach a gross revenue of BRL 309.8 million, which was an increase of 18.8% if we compare it to the same period of the previous year.
In the B2C segment, the increase was 18.4%, and in the B2B segment, 20.4%. An expressive increase. In the first quarter of 2024, the company had a few actions with the objective to improve its network. These actions were mainly for keeping our clients of Santa Catarina loyal, initiatives to reach corporate clients, and we also were able to increase our price with the digital account. This was able to give us better performance in our [ARPU] in the first quarter of 2024. In terms of our net operational revenue, we had a highlight in PCLD. The PCLD of the first quarter of 2024 had the reduction of 10.8% if we compare it to the first quarter of 2023.
This event was mainly due to the actions adopted ever since the year 2023, which consisted in adopting a credit analysis, a score credit analysis of our future clients, and also specific cash actions for charging our clients. For you to have an idea, the default of Unifique or delinquency from the last years until now, we were able to maintain what we already had disclosed in the end of 2023. Our delinquency rate is stabilized at around 3%, so it's a very positive scenario. Another positive scenario within all of the highlights of the first quarter of 2024 has been our churn index. With all of the work we've been doing, we were able to reach a churn index of 1.3% in the first quarter of 2024. Also stable if we compare it to the first quarter of 2023.
Going on to the next slide. On the next slide, this is on our operational performance. In the first quarter of 2024, we were able to reach 3.4 million of homes passed. If we compare that to the fourth quarter of 2023, it represents an increase of only 2.2%. I would like to highlight that ever since the last year, especially the fourth quarter of 2023, Unifique decelerated the construction of ports. We had built 350,000 new ports in the first quarter of 2024, so that's a reduction of 38.6%. Now we have 11,000 that we built in the first quarter of 2023 and a reduction of 49.3% if we compare it to the fourth quarter of 2023.
We are now using our stock of ports or gateways, and we are reducing our construction costs. The number of houses connected had an increase of 4.7% in the first quarter of 2024. This increase came mainly from the acquisition of Vexpert that was concluded in the first quarter of 2024, which was the acquisition of 28,000 new subscribers. If we look at the scenario of Unifique at the end of the last quarter of 2023, we were able to reach 400,000 new accesses, where 175,000 are in Rio Grande do Sul, 400,000 in Santa Catarina and 9,000 in Paraná.
Given all of this, Unifique is still the leader in the state of Santa Catarina with a market share of 20.7%, higher than the 17% of Claro and the 6.8% from Oi. On the next slide, where we have the financial numbers. In the first quarter of 2024, we were able to reach a recurrent EBITDA of BRL 126.7 million, an increase of 11.8% if we compare it to the fourth quarter of 2023, and an increase of 29% if we compare it to the first quarter of 2023. Therefore, we were able to maintain the profitability of the company. It's something we work very hard on, and we have very strong management on that, and we're able to get an EBITDA margin of 50.8%.
The improvement of our margins is mainly because of the incorporations of our controlled company. In the acquisition, we already work to find synergies, but after the incorporation, we still are able to find more synergies. An example of this would be issues related to labor aspects in the back office, so we can have these synergies. Just for you to have an idea, in the first quarter, in November of actually 2023, we already made an incorporation of [AXS] TV. Now in the first quarter of 2024, with the acquisition we made in February and also in March of [ViaLab], Tknet Telecom, Brick Serviços, and Concordia. We have four companies now that are being incorporated into our body in the first quarter. This is a very positive aspect for the rest of the year.
Starting now, we are being able to get all of the benefits from these acquisitions. In the fiscal aspect, we will probably improve until the end of the year because of this increase in productivity. As you will see in our numbers, we had higher expenses with personnel in the first quarter, but that is because mainly of the acquisition of Vexpert that brought a higher amount of employees, and logically this impacts our numbers. This is being well managed, and we were able to get very good results. Our profitability maintains at the margin of 50.8%. On the next slide, we have our level of indebtedness. In the first quarter of 2024, our total debt was BRL 641 million and a net debt of BRL 288 million.
Once again, this shows how healthy the financial numbers of Unifique are and how the capital structure of the company also allows us to continue being a consolidator. All of these numbers are positive. If you look at the chart, you can see that in the fourth quarter of 2023 compared to 2024, we were able to reduce the total debt by 11%. This is a very positive number, and we were also able to reduce even more at the net debt of 3.9%. We are able to demonstrate growth in this way. On the next slide, once again, we talked about this in the fourth quarter of 2023, but we are reinforcing that after the first quarter, we are now consolidating Vexpert in terms of market share.
Vex had 28,000 accesses. They covered around 50 cities, and they were in regions where we did not have presence. Before the acquisition, we had 0.6% of market share in these regions, and now we have 53.5%. It was a very strategic acquisition. This is very helpful for us when we look at the scenario that we have towards the future with services of mobile phone internet. This also helps us to increase our services for the future. Going on to the next slide. Here on this slide, we would like to show you the layout of our app for mobile telephone services and the functionalities that it provides. I have a personal experience with this app because I am also a user of our mobile phone services.
I have a family plan, and this app was very interesting because I had the opportunity to go through the entire journey of transferring my line, my phone line, and of my family's phone all remotely without having to go to a store, a physical store, to transfer these phone lines. It was a very positive experience. If we look at the middle of the screen, you can see how many additional gigabytes you would like to buy. This is another important point, because we have different packages. As a consumer, I can have an amount of data. I can buy them on a monthly basis, but of course, I have a teenager, a son, that ends up using a lot more data than I had originally hired.
It's very easy here to buy more additional data in a very fast way through our app, in a very simple way. The way we built the app with all of the layout and facility that the app has, it's being very easy to use and a very positive experience as a consumer. This is a highlight that we are bringing to our clients, providing a very seamless journey for consumers. I am experiencing this myself, and it's been very positive. To the next slide. Here we are going to give you an overview on the current coverage of Unifique with our own infrastructure. Here we are demonstrating the city of Garuva. In Garuva, we installed two ERBs for full coverage of the city. On the map to the side, we can see the quality of the coverage that we provide to this city.
In March 2024, the city of Garuva had 19,000 active chips, and at that same day we had already 400 chips activated in the city, which is approximately 2% of market share when we came in. The important thing to highlight is that the mobile phone services also increased our broadband internet clients, where we have now a 21.5% market share in broadband. Ever since November until now, November 2023 until now, our evolution in broadband internet has been so fast that very soon we will be the market leader in this city. On the next slide, we have the demonstration of Guabiruba. We installed one ERB with three different sectors.
In March 2024, the city of Guabiruba had 2,000 active chips, and on the same day that we installed this, we were able to grow to 7,000 chips in the city, which is a market share of approximately 2.2%. On the next slide, we have a city that is the headquarters of Unifique, Timbó. Here we had excellent coverage. We installed six more ERBs to cover the entire city. In March 2024, the city of Timbó had 54,000 active chips. Today, on the same day, we had 2,297 chips in the city, which is a market share of 4.3%.
If you observe on the day we enter with mobile services, we already have a significant market share in the city with good expectations and very good perspectives for sales. Here finally we have the city of Tijucas. Last Saturday on the 11th of May, our 5G network was activated in the city of Tijucas, and in this city, we installed six ERBs. Just so you can understand the potential that this city has, in March we had 67,000 active chips. Therefore, these are the main highlights that we have. In regards to our earnings call, now we are open for questions.
At this moment, we will begin the questions and answers sessions. Remember, in order to ask questions, click on the Q&A button on the bottom of the screen and write your question down so you can come into the queue. Once we call your name, you will be asked to unmute your mic, and then you can ask your question. We would like to kindly ask you that you ask all of your questions at the same time. Let's go to our first question from Lucca Brendim, Analyst, Bank of America. Lucca, we will let you turn on your mic so you can ask your questions. Lucca, go ahead.
Good morning, everyone. Thank you so much for taking my questions. I have two questions. You talked a little bit about the points of access, so I would like to ask questions on quality. First of all, on the margin, it was a little bit worse in the last quarter, and now it has a more positive impact after the acquisition. I would like to know, is this sustainable, and how can we see this in the future? Secondly, looking at future trends, the ARPU also had an increase quarter-over-quarter. Maybe could you give me more details on how you increased the ARPU, and looking towards the future, is there any positive dynamic for the ARPU? Thank you.
Good afternoon, Lucca. Let's go. First of all, in relation to the margin, I can tell you that our margin, the market has a lot of demands in terms of our margin. We had a margin of 50.8%, but our margin always was at around 50%. It's not a huge change. It would be if we had margins below 45%, but the company's metrics are at around always 50%, and we manage that very well.
All of the aspects of cost management and budget management at the company are things that we take very seriously, and we follow on monthly and even daily basis. We are always checking the aspect of costs, and we're very diligent in these terms. In terms of the future, of course, we want to always be around 50%, which is what we always understand to be a healthy percentage. I do consider 50% to be an adequate margin that we can always deliver, and it's what we seek to deliver. I always say we did an exercise this year of our budget in which we split it per segment. If we only had broadband in the company today, if we had other activities, because new activities, for example, mobile phone services, consume a bit of our margin.
If we were working only with broadband, probably our margin would be around 55%, our EBITDA margin. This segment, the broadband segment, supports us so we can continue investing in other products and services. That would be the first point. Now, when we talk about the ARPU, if there was an improvement compared to the first quarter of 2023 compared to 2024, it's mainly because of what I said, of all of the work that is being done in the company. Our loyalty program for our clients is very important. We did a lot of actions in relation to that, so we were able to deliver that in our commercial area. We were able to improve this area with all of these actions. We were able to add contracts.
We had to make a few renegotiations, and this also helped us a lot for the company's ARPU. We are also prospecting new large clients. We were able to be very successful with these actions, and that is the reason for these good results in the first quarter. If we were able to do it in the first quarter, this will definitely be reflected in the next quarters because they are recurrent. In general, that's what I can say. I am not sure if I was able to answer your question.
Yes, it was very clear. Thank you for the answers.
Our next question is from César , Analyst from Santander. César, please turn on your microphone so you can ask your question.
Good afternoon, everyone. Can you hear me?
Yes, we can hear you.
Well, first of all, congratulations for your results. I just want to talk about the M&A strategy. What is your vision for 2024? How many acquisitions do you think you will be doing this year? On the other hand, the expansion of your organic base, do you expect to deliver in the next quarters since it's going to be a little bit more normalized after the rains in December? What do you expect to deliver?
Cesar, could you repeat the second part of your question?
On the other hand, thinking about the organic base of growth, not the inorganic, what is your expectation for growth? What should we expect?
Well, in terms of the inorganic growth, we believe there are so many opportunities in the market.
Unifique has, I would say, financial bandwidth to capture these opportunities, but we are adopting a more conservative posture so that the deals can generate real value for our shareholders. It could happen, and maybe it won't happen. It really depends on the terms that we are able to negotiate, but we are prepared for acquisitions in this sense. On organic growth, our goal is to have 3,500 organic new accesses per month. In the first quarter, we had some problems in January, a few changes in methodology and in the way we calculated them, but in February and March, we were close to our goal, 2,600 per month, more or less. We are not yet reaching our goal, but we do consider that things improved in relation to last year.
We cannot forget to mention also that now we are working with mobile telephone services, so we are testing the combos, which has given us positive results. We were able to show a few cases, like the case of Garuva. It's a small city, but it is a mirror of that, and now we are going to start replicating this in several other cities. In Timbó, we have a market share of around 90% of the market, so I don't believe we will get a lot of growth there for optical fiber unless the city grows, with which we would grow as well. Tijucas is another experience that we are having, where we have 25% of the shares. So there we have the opportunity to expand a lot.
We just launched on Saturday, so we'll have to look at what's going to happen in the next few weeks. We are very excited, very positive. We are positive that fiber will help us sell mobile plans. We have 4.3% of share in telephone, mobile telephone services, so that's an excellent number for the first month until we believe that that number will improve a lot. In June, we expect to start having an acceleration in reaching the city. When we increase marketing with a new product, there's something new. This also is a way to disseminate the brand, but we need to see what's going to happen in Rio Grande do Sul. A lot of companies are going to have a hard time there to recover all that was lost.
Maybe there will even be a reduction in the number of companies reaching that market because of the losses and due to the points that we already brought up. It will be very difficult for some of them. Unifique was affected, but it was a very small amount of our operations. There were companies that were almost 70%, 80%, 100% affected. They are going to have a harder time to reestablish their services. Let's see.
Maybe could I ask one more question? In terms of mobile, I wanted to understand what do you think could come in terms of cost reductions and operational improvements with 700 MHz?
Well, the frequency of 700 MHz will definitely make it possible for us to use our coverage network significantly. This, we believe, will reduce around 40% of our cost of investment. Besides the fact that we also believe in an improvement of the quality of our coverage. 700 MHz is a very good, very good speed, especially for indoor environments where the frequencies of 5G or 3.5 HG z that we have can also perhaps face some difficulties. This will definitely help us to have less sites. What do we mean by less sites? Less investment, less CapEx, less renting out of areas, and improvement in the services. We were very happy that we were able to access this frequency, especially during this time. It can give us more facilities. Of course, this is a new market for us. We are learning.
We are very happy with the results we are getting, but I think that we are doing well, but it's still a learning process for our company. We set up a system. There are still a few frictions with sales, so we are making improvements every week, and we believe that in the second semester, we are going to reap the results of all of the work we've been doing that's going to make things easier. Our sales force, hundreds of people are improving in their training, making us very competitive in supplying solutions. It's exceptional. Of course, it will take some time for the market to understand this because the consumer market still thinks that it's all the same thing. I can assure you that the quality, the coverage of what Unifique is supplying to its clients is much higher quality than whatever's out there.
I am very sure that very soon we'll be able to get the same reputation that we have with fiber. We will be able to get the same recognition in mobile phone services and will be recognized as a reference in this segment.
L et's go to our next question. [Eduardo Azhaechi, an analyst from CTI]. Please unmute your microphone so you can ask your question. Eduardo, go ahead.
Well, my question was basically answered already, but if you could tell us more about the next steps for mobile. How will you improve in the supply and the offer? Are you gonna focus on your broadband clients or new clients? Are you gonna do combos? What is your expectation in terms of cities? Just so we can know exactly what you're expecting to do in the next few months. Thank you.
Thank you, Eduardo. We did our plan to cover around 3 million inhabitants in our area in the next periods. I'm not sure if we'll be able to do that this year. Maybe it will take us a bit of the first half of next year, but we are trying to do all of this work with a lot of patience and being very cautious because we really want to provide a service that is above average. As I said, since we are starting, it's a learning process for us. Right now, based on the first new active subscriptions, we have around 20,000 new subscribers. We are understanding our client profile better, so this will help us improve our services. We are mainly focusing on selling the combo, the package of services, including broadband and mobile phones, but in the next few months we will probably accelerate selling only mobile.
There is a difficulty in our system because our system is very modern. People can do everything online without having to go out. When our clients need a physical chip, not an eSIM, it's more a logistical challenge. We are finalizing the integration of the system with our partner supplier who is going to deliver the chips, and we are going to start the first test with this new supplier in the end of May, beginning of June. Probably we will be able to accelerate the process of mobile services separately from the combo, and probably we'll be able to increase our speed of that.
Because right now we are privileging the areas where we have fiber. We want to sell the combo because today we believe that around 70% or 75% of our sales are the combo, and we really believe that in 2025, we will start reaping the benefits of our churn improvements, which is our churn is very good, compared to market standards, but we are working very hard so that our churn is even lower, so we can improve even more the average ticket of our clients, which is something that we've worked very hard on. We've insisted in not giving in to making very aggressive discounts to increase our organic growth because we believe that in the beginning it may seem good, but in the long term, it may sacrifice the margin of the company.
We feel safer sticking to our strategy and following the path that we believe to be more guaranteed, let's say, in terms of the future.
Thank you.
Thank you.
Now I would like to pass the floor back to the company to answer the rest of the questions sent in the chat.
There was a question on how mobile telephone services work outside of Unifique's coverage area. Here we have a prerogative, which is Global Roaming, which is a legal mandatory aspect that all telephone services need to have. When we leave our area of operation, there is roaming, and it can happen vice versa as well. All coverage can be roamed in Brazil. At this moment, Unifique is negotiating international roaming. We are still haven't implemented it, but we are seeing how we can do this with some players. On the Unifique chip, people can travel to the main points of the world and have their chip working internationally. This will probably happen in the next few months.
There is also a question related to our policy of dividends. What is the expectation for the year 2024? What I can say here is that we have 25% of dividends that are not obligatory, but if the cash flow of the company allows us to distribute additional values, and if it's according to the plan of the company of paying interest on our own capital, then of course, we will continue with this scenario. What I can guarantee is that minimum dividends will be paid, and depending on the fiscal plan and flow of the company, we will have additional dividends distributed.
There's a question here about Starlink. How do we see the competition? Well, today, Starlink is a product directed to remote areas where we do not really reach with optical fiber. It works very well with 100 or 150 MB. Of course, it's not completely perfect if there is a solar flare or a problem with the satellites. Today, Brazil prohibits the full coverage of Starlink, so it will cost more than BRL 2,000 to install and then BRL 200 per month. It's a complementary way to get internet. In the past, we, Unifique, would operate with radio in those areas which we believe are probably having better services with Starlink. For actual cities, let's say optical fiber is running water from your tap, and satellite Starlink internet is like having water delivered to your home through a truck. I think that would be a good analogy.
Our questions and answer session is closed, and now I will pass the floor for the final comments from the company management.
Everyone, thank you so much for all of those who came into the earnings call. We continue to work very hard for the future of the company. We have the challenge of launching 5G and mobile services. Everything is going well according to plan. As we know, launching new products takes some time. Every day we are learning something new. I am sure that we will reach the end of the year of 2024 with a much better position than which we started the year and much better prepared for twenty twenty-five. We are very confident and very trustful about the success and the future of the company. Thank you so much.
The teleconference on the earnings results of the first quarter results for Unifique Telecomunicações has been closed. The Department of Investor Relations are available to answer all the other questions. Thank you so much to all the participants, and have a great afternoon.