Good afternoon, ladies and gentlemen, and welcome to the Proximus Q4 2020 Results Conference Call. At this time, I would like to turn the call over to Madam Nancy Gosens, Director, Group Investor Relations. Madam, please go ahead.
Yes, thank you. We will start this call with some slides from the CEO, Hume Boutin. The first part is what you received actually in the deck this morning. So after the introduction, we will go to your questions. For the Q and A session, we have here also Kathleen Underwear, the CFO, AI Jem Castilla, the Chief Consumer segment we have Anne Sophie Lopfering, the Chief of the Enterprise segment Kirt Stondart, the CEO Dirk Liebhard, the Chief Corporate Affairs and Matteo Kata from BICS.
We will take your questions in a moment. But before we get to that, Kiaan, please start with your introduction. Thank
Thank you, Nancy. Welcome, ladies and gentlemen, and thank you for joining us on this Q4 Conference call. If I go to the next slide, when Looking back on 2020, we cannot but stand still for a moment on how exceptional this year has been. During this pandemic, the telecom industry more than ever has shown the vital role it plays in modern society. We have kept people and businesses connected Every day, increased calling and the massive number of video meetings has boosted the traffic networks.
The sanitary crisis has accelerated digital adoption across all domains and age groups, opening up new opportunities for e commerce, e education and many other domains. Increased need for connectivity has also pushed the growth up in the Beijing Internet market. Now moving to Slide 3. And Proximus as a large Belgium company, we were very serious in taking up our societal role. We have launched several initiatives to support our customers And the specific actions we took for the most affected industries like education, hospitals, Culture and Healthcare are still ongoing.
Now moving to the next slide. And it's within this sanitary crisis we have been building on our growth strategy. We launched many initiatives and achieved good progress in our key strategic pillars. We have listed on this page a number of examples around our networks, around our digital transformation, Around also the diversification of our activities and also on the commercial portfolio event that As you're going to see in a few moments, generated quite traction on the customer numbers. But we have communicated those topics before, some even quite recently.
So I will not take you through all of them. But looking at this non exhaustive list, it's however clear that we have been taking meaningful steps in executing our strategy and are preparing the path to return to growth as of 2022. Before next slide now. Before turning to the more financials and operational results, I'd like to highlight some achievements in the sustainability domain I am particularly proud of. Our climate deserves our greatest attention.
Here in Belgium, we are probably the warmest week The history for the month of February and global warming has become a reality and we have to deal with. For Belgium, Proximus has an important role to play in reconciling the digitalization of our economy with this environmental challenges we are facing. We have set the Board's vision to make a net positive contribution to a net 0 planet and this by 2,030. To get there, We need to do more good and less bad for the environment, meaning that we need to enable our customers to reduce the carbon footprint through our products and services. This is a scope 4 on the right side of the slide.
At the same time, we also need to do less bad, meaning we need to act upon our total Carbon footprint, sorry, which includes our own direct and indirect emissions, so Scope 1 and Scope 2, as well as our indirect emissions throughout the value chain, the SOAR Scope 3. I truly believe we have an enabling role to play To our society by providing products and solutions that can reduce our customer carbon footprint. We work together with them to develop innovative solutions, enabling the decarbonization of our customers' footprint. As such, we can help make positive changes for the climate outside our own Turning to the next slide for some achievements. We are proud to have met in 2020 our carbon footprint objective That we have set for 2025.
We have reduced emissions by 105 kilotons. While the conditions were obviously quite exceptional, this acceleration proves that real change is within reach. At the same time, our footprint clearly shows we already strongly reduced our own emissions over the last decade. Our ambition is to go beyond our own operations to support our customers, as I said, and suppliers in embracing more sustainable habits. To that extent, we have drawn out our secular manifesto.
This is a commitment of Proximus and the to collaborate in the implementation of projects and initiatives in order to design together sustainable products. We aim to continue the good trend and stay on track towards making a net positive contribution, which is a very bold objective to a net 0 planet by 2,000 and 30. Now moving to the next slide. As a telco, we have an enabling role to play in the greenification of our society, as I said. Products and solutions that will enable the enterprise and public sector to decarbonize the footprint are, for example, And to be a little bit more concrete, a smart parking app that saves our customers time and fuel, which cuts back CO2 emissions traffic management systems that track the emission of company cars And optimize our usage, audio and video conference tools to avoid traveling and especially flying, monitoring devices for efficient energy consumption, IoT solutions such as smart buildings, smart cities, smart agriculture to enable better energy management and so on and so forth.
Besides the work being done for B2B, we also need to create awareness amongst consumers on how to improve the Cabot footprint in their daily life. By teaming up with the economy, we have kicked off the creation of an ecosystem of light minded companies with the ambition to empower consumers To make them aware of the daily carbon impact, the first objective is to help raise awareness about the urgency of climate change and our shared responsibility to apps. Proximus and the economy, we start by offering Proximus customers digital tools to track their carbon footprint. The second step is to enable them to opt for more sustainable lifestyle. We are the 1st telco Player in the world to team up with the economy and to engage our customers in climate action.
Now moving to the next slide. We have set to ourselves the ambition to become truly secular by 2,030 and are gradually saying goodbye to the current economic system of taste make waste. The secular economy is based on the idea of no longer eating up raw materials, but extending the lifespan by reusing, repairing and recycling them. We have been collecting and refurbishing models and decoders since 2014. We are granting a second life to 90% of all devices, which corresponds to EUR 2,000,000 refurbishments.
EUR 489 ks devices have been prepared for a second line in the course of 2020 the ambition to do even slightly more in 2021. One material we have been recovering on the grand scale is copper. In 2020, 9.94 tons of copper were recovered. That is because we are gradually replacing our copper networks with a fiber neutral and we come back to that And we are in the process of outpacing certain buildings. 2020 was a rather exceptional year as we outpaced 2 large buildings, which explains why we have a lower objective for 2021.
As On this, Cai, as well, I'd like to mention the don't miss the call initiative, which is a large campaign to raise awareness about recycling and to motivate people to return the old devices. The valuable and increasingly scarce raw materials can be reused in new phones. Our goal was to collect 100 key phones in 2020, but then COVID interfered with this plan nonetheless we still collected 55 phones, which is an amazing performance the last past year. And we are extending the campaign in 2021 with the objective to collect 150 units in this year. Going to the next slide, and let me turn for a moment 2 are financial and operational results.
And I have first on the operational results with the customer growth of the group And which is quite solid despite challenging circumstances. I'm now on Slide 10. That is showing that over the past Here, we have kept a strong commercial momentum in a very competitive setting, growing our core customer base with a specific focus On value customers, as you can see in the very nice trend that we have on TV customers. So I'm very especially pleased that we have been able to show very nice improvement from the growth we had Shift in 2019 and this is true for all our core 3 our 3 core products that we are putting in the market. And we have achieved these good results for a number of reasons.
First, we are benefiting from the effort that we have done in terms of network investments. The high quality was proved during the confinement and lockdown with our networks holding up very well in spite of the steep increase in usage. Besides our networks, we offer our customers with fixed wide variety of content. We are, for the moment, the only one to really showcase MiSTa Plus, for example, for our customers. And we continue to play a content aggregator role.
As a last point, but having a very good contribution to our customer acquisition are the offers that we have launched on the market. We see for the Proximus brand a very, very strong commercial traction for the new convergent offering Flex that we have launched On the 1st July 2020, while our Skalit brand continues to thrive in the market for cost conscious customers. Moving to the next slide. With this very nice traction for Flex, we have ended 2020 with 317,000 subscribers for the Flex offer. This success is also driving an increase in our convergence rate now reaching 60% of all Multiplay customers.
Flex is also driving a higher number of MultiMobile customers and hence leading to positive impact on the RGUs and therefore on the average revenue per customers, which is for the 4th quarter up by 1.5%. Moving to the next slide. What is more is that with the rollout of our fiber network and with the acceleration of this Roll out, we also start to see the positive effect of customers signing up for fiber. In 2020, we had a total of 65 1,000 fiber customers within our consumer segments. As we continue and accelerate our coverage, we see more and more customers coming on the fiber network.
And now going to the Slide 14. Taking a look at our business segment, As you know, the sanitary crisis has made the economic environment quite changing. And in this setting, the Enterprise segment has shown quite good resistance In terms of volumes, keeping good growth in its mobile base and keeping its Internet base fairly stable. This is in spite of competition on the leisure market, which is heating up for the enterprise segment. The competitive pressure It's mainly shown in the mobile ARPU trend, which besides the effect of COVID-nineteen on roaming is also reflecting some ongoing pricing pressure.
Now moving to the next slide. ICT was also of course exposed To the sanitary situation and the impact of the economy, but while there was for sure exposure, all in all the ICT revenues are still headed pretty well in Showing small growth from the prior year and now representing 40% of EBITDA revenues. Let me take a quick look at the domestic revenues. And moving to Slide 16. So Testimizing for 2020 was down by 2.3%.
The chart shows the main elements of this decrease, all of these decrease. The first three are, I would say, our core news, being the revenue, Telecommunication Services and ICT From both our consumer, this includes the mobile revenues, which was significantly in Traffic is critical. And if we take out the remaining out revenues from both 2019, Driver of the domestic revenue decline was inbound revenue at low to 0 for us and furthermore roaming in and also for the total which leaves Some negative FX on a year over year comparison. This was for domestic revenues. We'll have a look at BICS And tell you sign on the next slide.
And as we have announced a few weeks back, we have acquired the full ownership of BiX. As a reminder, BIG as a company is in fact composed of 2 large activities, TeleSign and BIG standalone. And as we explained the day of that announcement, TeleSign is a fast growing leader in the digital identity space And in the programmable communication space, its revenue grew over 2020 by nearly 57%, driven by authentication and Mobile Identity Services. BIG standalone direct margin declined by 13.6% over the year, Carrying the last largest part of the COVID-nineteen impact. In addition to this adverse COVID-nineteen effects, the underlying direct margin was further impacted by MTN in sourcing process, emphasizing the SecureVoice revenue decline.
In contrast, sorry, growth was noted linked to the expansion of fixed activities in the Cloud Communication business. Now moving to Slide 18. We have closed the year with a strong reduction of our cost. For the domestic cost, we achieved a 3.9% decrease, Of which €45,000,000 is a structural reduction and is largely the result of our headcount program we launched in March 2020. In top of that, we also had some benefits from COVID-nineteen, which were rather of temporary nature.
Putting all together, this brings me to the group EBITDA on Slide 19. And here again, negative effects from COVID-nineteen has played A significant role in the decline. The group EBITDA for the full year 2020 ended €34,000,000 below the one of 2019, including an estimated negative impact from COVID-nineteen on our operation for almost EUR 50,000,000. On the next slide, you can see on the CapEx and Investment side on Slide 20, we have our fiber rollout that is progressing very, very well. Ended the year with a total number of 460,000 home passed, an increase by 65,000 in the last quarter of 2020.
As you can see on the chart, we have increased our weekly pay significantly, reaching 5,000 per week in the Q4. Hence, we are well on our way to realize our announced acceleration of this fiber rollout. On Slide 21, you see that including our private investments, our CapEx for 2020 reached exactly €1,000,000,000 Which was slightly above our estimation due to some additional customer CapEx in the last month of 2020, driven by the success of Flex, The normalized free cash flow for 2020 ended at €354,000,000 And as shown on the graph, The main driver for the lower free cash flow level compared to 2019 was the additional cash out related to the headcount programs With especially high cash out for the fit for purpose plan. I am on slide 23 now. So with €836,000,000 of EBITDA minus CapEx, we have delivered upon our guidance for the year, This is in spite of a bit higher than anticipated CapEx as I said before.
This brings me to the last part of this introduction. And now looking at 2021 beyond and now moving to 2025, To the guidance and as we set out during our CMD March 2020, The year 2021 will be a transformational year for the company. It remains for 2021 still highly uncertain on what will be the level and duration of COVID-nineteen And what would be the real impact of this filtering situation? In our assumption, we have anticipated a gradual recovery of forming volumes in the 2nd part of 2021. This included with respect to the 2021 underlying domestic revenues To remain rather close to the 2020 lever, supported by the further customer growth in the consumer market, TV and mobile postpaid base And I carefully manage transition within the Enterprise segment.
For our wholesale segment, we expect a continued impact from eroding SMS inbound traffic, But as you know, this has a neutral effect on domestic margin. To build the foundations for our growth trajectory, we anticipate in 2021 additional expenditures. For our domestic operations, this is related to fiber migration and IT transformation. Also, classification, which is a trendy industry the rollout of the shared mobile network by Emirates, we have under the effects of increase in OpEx while reducing CapEx, so no impact on the cash. At the same time, we expect less cost benefits from COVID-nineteen related measures in comparison to 2020.
All these elements count for a total of around €50,000,000 of operational expenses that will impact our domestic operations. This aside, we'll continue our tight cost control in other areas and work on cost efficiency to further the utilization, automation and simplification of our operations. So this brings us to the underlying group EBITDA for 2021, which we expected to range between EUR 1750,000,000 EUR 1775,000,000 of euros. Our group CapEx is estimated to land close to EUR 1,200,000,000 for 2021. As we announced at our fiber update in January, we are aiming to double the rollout of speed of fiber compared to 2020.
In addition, we'll be investing amongst other things in the mobile network as well as in IT transformation. And with regards to our debt lever, This takes into account equity injections in the fiber GVs, the acquisition of the minority shareholders And of course the acquisition of Mobile Vikings Pending the approval of the competition authorities. Now moving to Slide 26. We confirm our vision from our Inspire 2022 strategy, Bringing the domestic operations back to top line and EBITDA growth as from 2022. We also confirm our indirect OpEx ambition for 2022 Being a net indirect OpEx prediction of between minus 1% to minus 2% CAGR and this over the 3 year period 2020 till 2022.
With digitization benefits coming sooner than expected, this cost objective was already largely reached in 2020. So in a view of obtaining social cost efficiencies, we are shaping up a new company wide cost program in which we are envisioning a total of gross cost savings for about €400,000,000 Roughly half of this is reflected today with the 2020, 2022 cost objective and the remainder is to come in the 2023 to 2025 period. This brings me to my very last point. I'm pleased to announce that our Board of Directors approved proposed to the General Assembly to return to our shareholders a gross total dividend of €1,200,000 of which €0.50 was returned as interim dividend in December 2020. We also reiterate our intention to return over the results of 2021 2022 a gross dividend of €1.2 per share to be considered at the floor.
With this, I've come to the end of the presentation. So you can now open the line for your questions. Thank you.
Thank you, sir. We have one first question from Mr. David Jagman from ING.
Thank you. Good afternoon, everyone. Can you hear me?
Yes, you can.
Yes. Okay. Thank you. Thanks for taking my questions. So I've got 2 main questions.
First, concerning your disposal program. Once your Emuiz JV is fully operational, so after the integration and given the very strong appetite From investor and the rich validation for towers, would you consider selling part of your tower asset or stake in M Wings? So that's my first question. And then secondly, on the free cash flow investments in 2021, Could you elaborate on the total CapEx guidance and the equity cash injection for fiber in 2021? I thought there would be a reduction in 2021 CapEx compared to the initial Capital Market Day guidance And this thanks to the JVs.
In the end, you still guide for CapEx close to of €1,200,000,000 Which to me seems a bit on the high side. So is it related to additional investment, not fiber related or is it simply phasing or customer customized equipment, so market share related. And so as I said, so if you could also quantify the equity cash injection of 2021, And whether this is basically essentially front end loaded? Thank you.
Okay. First on the on your first question, As you said, the focus for 2021 is really to execute on the Envings Joint venture and to really work on the combination of the active mobile network of Proximus and Norens. That's really the focus of 2021. That said, you also know that the context, the regulatory context of the major market is a little bit more Unfavorable compared to other markets in terms of towers. But that said, I think we it's fair to say that all options needs to be kept open and that we will Consider that possibility not being A short term focus for us, but we want to keep all options open.
So we definitely also work and prepare and do some preparatory work. But As I said, we have also operation in Luxembourg that could be a market for us on that matter. And we will focus On Emuyns and so on the combination of the active part of the network invasion and all options are still kept open for the tariffs invasion. I will also start on your second question and then leave the floor to Kathleen. And we'll start with the CapEx question.
I think the €1,200,000,000 reflects really the acceleration we want to do. First, our sales knew that we are 1st, rolling out wholesale in the more dense areas of Belgium and indeed this is ambitious in terms Of rollout because we want to roll out 300 ks new homes next year with our own fiber. So that is a very ambitious acceleration. So the level of CapEx will be also Depending on our ability to reach that very ambitious acceleration of the rollout, but I think this is a good investment. So if we can I really made that objective and will be happy to reach the €1,200,000,000 of CapEx next year?
Of course, Depending on the achievements in terms of FTTH net new homes, the level of CapEx will be adopted.
And so as to your question on the free cash flow. Looking at the free cash So consensus, which is €330,000,000 I don't think we will be that far off. So what is the free cash flow composed of? This is, of course, the EBITDA minus the CapEx That's we have for as well several cash outs for the DICK'S acquisition for Mobile Vikings, But we will end the equity injections in the GVs, which should be still quite limited in 2021. But we have as well some good news.
Some good news related to some timing and tax payments as well less restructuring payments that we will have
Looking at the leverage of 1.sorry, the leverage net debt to net debt to EBITDA inflation that it will remain below 1.6 Because this is quite it seems if we would put a sense at 1.5, it could still be quite above Conferences, it seems to me it's not because of some equity cash injection in the JV.
So the leverage of 1.6 takes into account, of course, our free cash flow. That takes into account as well the acquisitions to acquire the minority shareholders of VIX Mobile Vikings Unlimited injections in the fiber JVs, but this has been offset by some timing and tax payments And as well as restructuring payments.
Okay. Thank you very much.
Yes. So just to add, as Kathleen said, if you look at the consensus free cash flow today, I think the message was quite clear, that we will not land far off that consensus in 2021.
Very quickly. Thank you.
Thank you, sir. Next question is from Mr. Nicolas Scott Pelisson from HSBC. Sir, please go ahead.
Thank you. Hi, everyone. Back on the EBITDA bridge to 2021. First, can you explain better the You will link to fiber migration, IT transformation, classification. Can you be a bit more precise on that?
And if you also can say if it is impacting the gross margin or is it below that? The gross margin or is it below that? Secondly, on network sharing, I thought the plan was for OpEx and At incremental cost of €75,000,000 in 2021 to €23,000,000 has this changed and how does this contribute to the previously mentioned €50,000,000 And third and last, what's the impact of fixed and mobile television rates cuts expected for 'twenty one and 'twenty two. Was it incremental EBITDA pressure you had to factor in in your new guidance? Thank you.
Okay. We'll take your first and your third question. On the first one, on the €50,000,000 were linked to fiber classification, you can Consider that 1 third is one offs, mostly linked to COVID. One third is Transitory costs for transformation, we have boosted our plan to transform our IT systems And this will be a bump in OpEx So linked to the CapEx spend on IT Transformation, you know that part of your CapEx needs to be as a consequence on your OpEx line for IT Transformation. And 1 third is more a structural link to fiber migration of customers, including customer OpEx, when you migrate a customer from the fiber network to the copper network, you have an OpEx cost associated And to the migration, it's going to be starting to be significant in 2021 and will continue in the coming years.
And then you have the clarification effect when you are moving to cloud, your information system, you are switching CapEx costs to OpEx costs and of course with no impact on the cash, but in the way you are accounting for Those cloud based IT systems have an impact on your OpEx base. So just to summarize, 1 third one offs, 1 third transition cost Not to be replicated after 2023 and 1 third of more switchable increase of our cost, But as said, our guidance of net decrease of our indirect cost In between minus 1 to minus 2 CAGR decrease in between 2020 and 2022 includes all those elements. So there is also That to be taken into account. On the FTR and FX And mobile commission rates, for us, it needs to be very, very low impact On the direct margin, only a small impact on the revenue side, I mean, no impact On the direct margin, it's a and one question I forgot to answer on the first one. So it's mainly below the direct margin effect of €15,000,000 So it's no impact on direct margin, mostly below direct margin that you're going to see Those EUR 50,000,000 next year.
And on the Nefertchain?
And so on the network sharing, Indeed, we do have some investments to make in order to make the mobile network sharing Agreement upon running and those investments are included in the CapEx as well as in the OpEx part. And so they are included in our guidance, and the numbers haven't changed compared to our previous guidance.
Sorry to follow-up on that. Within the €15,000,000 in the onethree, onethree, onethree, is there anything for this run sharing startup costs?
There is a part included. But it's yes, it's a small part, which is included And the temporary impact that we will have for a short period. And so of course, once that The mobile home sharing is up and running. Those costs will disappear.
Okay. Perfect. Thank you.
Thank you, sir. Our next question is from Mr. Emmanuel Cartier from Kempen
Hi, good afternoon. Thanks for taking my questions. I have 2. The first one is on fixed voice. So we saw accelerated losses in 2020 year over year.
So the question is, what is driving that? And do you believe that the 2020 trends will continue in the coming years? And then the second question is about the EBITDA guidance. So if we compare With your midpoint of the EBITDA guidance, there is a EUR 80,000,000 more or less EUR 80,000,000 difference. So EUR 50,000,000 is Related to the additional expenses, but what is in your view the other EUR 30,000,000 that is missing?
Thank you.
Good afternoon, Emmanuel. Jim Castellis speaking. So indeed, we see In the consumer segment, a declining appetite for fixed voice. This is also why we have launched mid last year our new Flex Offer, which is addressing this new trend and is actually also delivering, as Guillaume already mentioned, very good Operational results. Going forward for the coming quarters, I don't expect any real changes on this trend.
So I expect this We tend to be similar to what we have been seeing over 2020. What is important for us and what we really look at is the RPC, so the average And as you know, our 3P convergent ARPC is around €92, which is much higher than the current average IPC of €59,000,000 So we still create a lot of value with our 3P mobile flex solutions. And we also see in our Q4 results that we have been able with Flex to capture the valuable part of the market As we have delivered very strong performances both on Internet but also on digital TV and on mobile postpaid.
On the EBITDA of 2021 compared to the conferences, I think indeed, Dan, you have the €50,000,000 that could Part of the explanation. Second thing probably that could explain the difference is related to BiCS and TeleSign. Now we still have an expected roaming impact for BiCS Because we have one initial quarter of COVID impact and all Q1 is compared To last year, 2nd, at Telefines, you've seen the growth numbers. And if we want to continue and to accelerate that growth, We need to reinvest a little bit in the growth, in the product, in the go to market of TeleSign to deliver a 3 digit growth year over year Next year, that also implies some investments in products and go to market. So that's the second element, this at TeleSign probably that I think a little bit different from what we have in mind and the guidance.
And the last element probably, but We confirmed that the transition at the B2B business is even if we are really Trying to do it as possible. This transition, the price pressure on the EBITDA market Is there and could be one last explanation of the difference between the consensus And our guidance.
Thank you for that. Maybe one other question I have is on the free cash flow. So you commented on free cash flow, but to me was not very clear. Did you give a bit more precise guidance on 2021 free cash flow expectations?
What we did is that we just mentioned that the consensus today is at €330,000,000 for Free cash flow for 2021. And what we just said is that we should not land far off that number.
I still have a bit difficulties to understand exactly why, with the EBITDA being lower lots and CapEx Hi,
Er, could
you maybe quantify some of the variables like the cash tax that will be materially lower?
So let me try to answer this. I think in terms of EBITDA, we gave the guidance. As well in terms of CapEx, we are guiding as well because on top of it, you will have Some extra cash outs for the Bigs acquisition for Mobile Vikings and as well a limited amount of Equity injections in the fiber GVs. But at the other and we will have dividend payments, of course. But at the other hand, we will no longer have some important cash outs for the headcount transformation plan.
And we will have some good news in terms of tax payments.
Could you be a bit more precise on the tax guidance? Because that's a one of the points.
No, No, that's we don't disclose that. I can only repeat that we think that we won't be too far off From the free cash flow consensus of EUR 330,000,000.
Okay. Thank you.
Thank you, sir. Next question is from Mr. Michael Bishop from Goldman Sachs. Sir, please go ahead.
Yes. Thanks very much. Good afternoon. Just a question on the top line guidance, please. It sounds like from the presentation, you're suggesting that consumer growth can remain Quite robust with the tailwinds from the better subscriber growth this year.
But I was just wondering What are we thinking? Is consumer growth going to be enough to offset the tailwinds or sorry, the headwinds in enterprise? How will the 2 dynamics play out in 2021 within the guidance? Thanks.
That's exactly correct. I think that we indeed are having a very nice traction on the consumer part, And we are transitioning at the Enterprise segment. And we do think that The growth in the consumer activity will Partly offset or all offset because it's hopefully in line with this year. 2 elements, of course, the content transitioning On the transition period at Enterprise, but also a continued decline on Mobile incoming revenues, do not forget that SMS mobile traffic We'll continue to decrease, so we also have to offset the decrease in mobile SMS incoming revenues.
Okay. So you are saying basically that you can be flattish or is this sort of approaching flat
Yes, sorry, I was muted. So yes, that's what we guided. So I think this is quite clear.
Okay. Thanks very much.
Thank you, sir. Next question is from Mr. Ruben de Vos from CLP Securities. Sir, please go ahead.
Yes, good afternoon. Two questions. First one relates to the guidance on the net to EBITDA ratio. Thanks for providing that. I was curious where this ratio aside from cash out from acquisitions that have been announced, It also includes some assumptions on proceeds from future asset disposals in line with the Inspire 2022 objectives.
For instance, thinking about the intention to downsize the headquarters in Brussels or the sale of other activities such as BMOBILE That's the first one. The second one actually relates to COVID mostly. Yes, Belgium has been in a quite Stringent. There have been some quite stringent lockdown measures in place. Initially, most of your shops closed and later reopened.
Your commercial Performance did not suffer too much in Q4, on the contrary. But related to customer installations and deployment of fiber, Just wondering how much of a challenge are the current measures today? And then more broadly, yes, You've managed to very much quantify the overall impact of COVID-nineteen in 2020. Obviously, curious for 2021, what are sort of your assumptions this time around? Thank
you. So on the net debt to ratio EBITDA, there is of course not the cash out from the acquisition, but there is no nothing in it coming from disposal of assets. And the eQuarters in Brussels, It's going to be a long story now because we are not planning to move before 2024, 2025 time frame. So VivoVale is not what to say. So I think this is really only the disposal of the acquisition Of the Viking's and BICS that is reflected in that guidance point.
On the customer installations and FADOR rollout, I have to say that we and thanks to the team. Yes, Tim can answer the question.
So with respect to fiber deployment and installation, I can tell you we're on good track. It was, in fact, last year That we had an impact of COVID because you might remember that during a serious number of weeks, we were no longer permitted to do roadworks and trenching, which is not happening today. On the contrary, we see that we have some More flexibility, for example, in city centers that the permits we're getting to intervene now and do as much as possible While it's calmer in the streets and in the centers, it's just a positive for deployment. So at this moment in time, I can tell you for 2021, we are on track with the plan, which is the doubling of what we did last year.
And as
to your second question, of course, it is very difficult to forecast what Travel international travel will be going forward. But what we can say is that we will have one more quarter, the first of COVID impact compared to last year. But right now, we're we think that there might be a slight recovery of travel As of the second half and for BiCS, of course, where we have exposures to COVID here in Belgium, that's Good morning, guys. But for VIX, we have a worldwide footprint. But here, we are seeing as well Some prudent incremental adjustments as of Q2.
All right. Thanks, and then just
We could come back on
the negative EBITDA ratio. It includes more of Viking and therefore, the price consideration is €130,000,000 But yes, that assumes that we should also take a look at EBITDA impact from Malawi. Can it be possible to disclose that It still depends on timing of the approval?
No, of course, it depends on the timing of the approval. So there is only So the cash out effect in that guidance and you know it's going to be a limited impact for even if we manage Close the operations by means here is going to be very much an impact on the EBITDA. Also knowing that the synergies can be executed as from 20 The network synergies because you know that 22, sorry, we need next year. As Mobile Viking customers are not on the Proximus network. So this is an initial synergies for us as from 2022.
All right. Thank you.
Thank you, sir. Next question is from Magalha Meht from Citi. Please go ahead. Hi, thank you for taking my question. So I had a couple of questions.
One on the cost savings, you mentioned that half of it is related to to the period 2022 and most of which has realized in 2020. So is it fair to assume there'll be no cost savings benefit at all in 2022? And also if you could just clarify the drivers for top line EBITDA growth in 2022. And my second question is what's update on the sale of VOO and what would be preferable from an approximate perspective, a VOO TeleNet combination or a VOO Orange Belgium combination? Thank you.
On the cost savings, indeed, we said that most of it have been realized in 2020. But So similar in the commission, we made this point that we have adverse cost over the course of €15,000,000 of customer costs. Some are one offs from As I said, transition costs and some others are social cost increase. But so that to overcome That cost increase, we need to continue decrease on direct costs. That's why we have launched Another cost cutting plan program, which is an enterprise plan to substantiate The 2021 to 2022 evolution of our cost, but also to prepare for further control of our cost after 2022.
So that's really why we have launched it because now to decrease the cost in 2023, you need to work now And the transformation of your systems of your IT platforms to prepare for 2023, it's not like you can decrease your cost over a month. So this is why we have launched this new plan and that is also why we will continue to be very, very focused on executing on It's cost efficiencies going forward. And the second question on the VUM sale process, obviously, This is not my concern today. My concern is to really execute on the Inspire 2020 plan. We have so many things to do.
We need We need to accelerate the cyber rollout. We need to position the EU segments. So this is what we are really focusing where we speak, and we'll be ready to win that market. Weaver is the owner of Zoom. That's really I cannot say more than that.
Next question is from Mr. Roshan Ramjit from Deutsche Bank. Sir, go ahead.
Great. Thank you. Good afternoon, everyone. Two questions from me, please. Just on the ICT unit, you say that you, I think, increased Your share.
Is it possible just to give us some thoughts looking into 'twenty one? Obviously, there was some volatility Through the year, tougher comps in certain quarters. Should we be thinking about a, I guess, relatively flat profile through 2021 or is that going to be a bit more lumpy? Anything you could say there would be helpful. And secondly, just Settling back to maybe one of the previous questions.
On the €50,000,000 domestic cost now, I think it's quite clear for us to get a sense of how the Fiber migration costs will go across in the coming years. But on the cloudification, is there any variability there? I think that's you said capitalization of hardware. So outside of the M Wings, is there any scope for any variability in that number translating between OpEx and CapEx beyond FY 'twenty one. Thank you.
So good afternoon. It's Anne Sophie Lottgren, responsible for the Sorry, business unit. Thank you very much for your question on ICT. As you did see indeed, we were able to increase our ICT Share for total revenues in 2020, and we anticipate that we can do that again in 2021. What's very important for us is the mix of the ICT revenue because as we've been able to demonstrate in Q4 of this year, It's very important that our services contribution increased versus the product contribution.
So as part of the transformation of our business moving forward, Our ability to increase the services contribution after the total ICT contribution is absolutely key moving forward as well. So that's what I can say in terms of guidance for 2021.
And just to follow-up, just in terms of taking share, What type of customer base and who you're taking share from can elaborate on that?
Sorry, I didn't quite catch the question. You were very faint. May I ask you to repeat it? I apologize.
Sure. No worries. It was
just on taking the share. What type of customers and who are you taking share from, please?
So traditionally, our biggest Share of ICT business has been on our top customers. But one of the main areas that starts with our transformation is to make sure that we're also able to address The smaller type of customers with more standardized ICT offers, and that's also part of the transformation of
the business moving forward. I hope that answered your question. Yes.
No, that's clear. Thank you. Yes.
And this is Geert speaking on your question on cloudification. Let me Maybe put some more context first around that. So it is as such that we as Proximus, we pursue what we call a hybrid Multi cloud strategy. So that implies, in fact, that we organize our internal IT across multiple platforms. And that means Traditional on-site platforms, fully virtualized on-site environments, but also different on-site private clouds, but also Different public cloud players.
And so the financial impact that we are referring here to is in fact that financial impact of cloudification Towards public cloud players. In that sense, when you move workloads to the public cloud, then of course, at one end, you avoid CapEx investment on your own infrastructure, you invoice renewal of your own infrastructure, but of course that implies then a higher renting fee For consuming the resources in of those public cloud players, and that goes into OpEx. At this moment, For 'twenty one, that is indeed a trajectory where we are moving gradually more and more of our workload Towards the public cloud. So in that sense, yes, you already have an impact in 2021 and where we assume that a certain single digit Percentage of our IT is moving towards public, but this will grow further grow in the outer years.
And just to add, when you are a small player like Proximus, you really need to leverage the R and D capabilities Of the public cloud providers, if you want to continue to be more and more efficient on the years to come. So this is also part Of further overall efficiencies of the total cost of ownership of our IT system. So that's really why We are very happy to take that call even if this is a little bit waiting on our OpEx cost.
Great. That's very helpful. Thank you.
Thank you, sir. Next question is from Mr. Ben Bryant from Credit Suisse, sir.
Hello. Thank you for taking my questions. I have a few, if I may. The first is on wholesale. You've already Any pickup in wholesale fiber revenues?
And are you speaking to any significant wholesale partners given that cable prices are going up, could possibly be a tailwind? And also on BICS, do you have any internal or targets? Have you said anything publicly about when you expect TeleSign growth to offset legacy decline? And lastly, just on TV. Have you seen any impact from the streams launch?
That would be quite interesting given the net sales were quite strong last year. Thank you.
So just on your question on wholesale, of course, we are not going to be Specific numbers around our expectation for the different topic. You mentioned the roaming drivers, etcetera, etcetera. But Indeed. The specificity of Proximus with the fiber development compared to other operators in that We are not shifting copper wholesale revenues towards fiber wholesale revenues because we do not have fixed Copper also released today or very limited fixed copper also released today. So that's indeed an opportunity for us if we manage To meet the acceleration of the rollout of the fiber network, we could have more and more customers On our fiber network, and it's not going it's going to be material for next year.
But on the long run, this could be indeed An opportunity for us also compared to other geographies where fiber has been rolled out. On the bit, I will now report to Matteo.
Thank you for the question. I'd like you to actually restate the question because I didn't catch the second part of it.
Sure. I was just wondering if you have any targets on telethign growth to offset legacy decline in that business? Thank you.
Okay. So I think your question is about EBITDA, most likely, but I would like to remind you that The Telefonica is operating in a market which is a C Bus market. It's delivering above market rate in terms of growth, We expect that of course, we expect that to continue. On the BiCS side, as we have explained also in our call on February 9, Basically, BiCS consists itself in 3 areas of the business: legacy, where you have a structural voice decline, where we continue to optimize margin Waiting to participate in consolidation. The core business, which has been impacted by COVID, that is the recovery, is linked To the recovery of the COVID, which from a big perspective is a global matter, fairly complex to predict.
Therefore, we are very disciplined and prudent on that front. We expect staggered and very diversified recovery of COVID across the globe. And then the growth areas where we intend To announce our exposure to the Cloudcom and CPaaS enablement market, and we have already we're building on that On the basis of what has been built in mix in the past months.
So This is Jim speaking again on your last question on streams. So as you know, our latest TV offer is building on Android TV As a platform and one of the big advantages of Android TV is that we are able to very quickly onboard new content partners. And so this has actually allowed us, as of launch of streams in the Flanders region, To offer streams as a service also to Proximus customers, so we didn't have a negative impact Of the launch of streams, it's actually furthermore a positive impact because we can now offer to our customers content That in the past, was not available to them.
Okay. Thank you.
Thank you, sir. We have another question from Mr. Nicolas Cattabisson from HSBC. Sir, go ahead.
Yes, sorry, me again. It's going to be short. On KPIs, any explanations around the full year quarter play customer base in the last couple of quarters? Is it a change in market dynamics? Because I can see an increase in Triple Play in parallel.
So what product clients are dropping? Thank you.
So this is Jim again. So indeed, as you can see in the quarterly evolutions of fixed voice, Actually, this is also what you see coming back in our Quad Play. But as said, our triple play flex Offer is really driving a lot of value with a very strong ARPC. And so we're really happy With that performance, but so indeed the impact on Quad Play is linked to fixed voice being less and less appetite for the consumer segment.
Okay. That makes sense. And do I understand correctly that you said about the TV trends that what we have seen in the last couple of quarters It's something we should also see in terms of the net adds for 2021?
That's indeed the ambition and that's the trend that we have been Over the last month, so we will continue to drive the market and our customer acquisition in that sense.
Thank you. Thanks, Toni.
We have one last question from Naya Abhijit from Citi. Madam, Anja, your mic has been open. Hi. Can you hear me? Yes.
Hello. Yes. So just one quick question. Would you consider co investing with Telenet and Flonders or having some sort of collaboration with them Rather than both of you overbuilding each other's network?
Yes. I'm sure you understand that I cannot be precise if I cannot answer very precise on that question. But What we are doing is building this fiber network and we always stated that this fiber network is an open network. So we'll be more than happy to welcome Telenet on this network. And we are also hoping for a rational behavior Of all players in the infrastructure play, so We see what will be also the outcome of the discussion between Telenet and previous.
Let's see how it goes, But we are quite confident that we are building the best network, the best infrastructure. And it's an open infrastructure, so There is no reason why we should not be in a position to welcome Telenet or others on our network.
Thank you. Thank you. We have no other questions. Back to you for the conclusion.
Yes. Thank you all for your participation. Should you have any follow-up questions, you can contact the Investor Relations team. Thanks. Bye.
Ladies and gentlemen, this conference call is concluded. Thank you for your participation. You may now disconnect.