Earnings Call: Q2 2021

Jul 14, 2021

Thank you very much, operator. Good morning, everyone, and welcome to the second quarter report for Tele2. With me today, I have Mikael Larsson, our CFO and Samuel Scott, our Chief Commercial Officer. Today, we'll walk you through the results for the quarter, and we will run a Q and A session afterwards where we can address your questions. Since I became CEO of Tele2, I've talked about the challenges that we have faced and dealt with during our ongoing pandemic in order to reach our goals. With a post pandemic society on the horizon, I can now safely say that we are overcoming those challenges and we are starting to see a turnaround in the financial results. At the Capital Markets Day in May, we presented our plans for our commercial business as well as the crucial IT and technology transformation that enables it all. I'm happy to see that the plans we have set are already starting to show positive signs as I will briefly explain to you as we go through the figures of this quarter. So let's then turn it over to the numbers. End user service revenue returned to 2% growth for the group in the quarter as Baltics continued to grow really well and we saw Sweden stabilizing as we grew in Sweden B2C and we saw a trend shift in Sweden B2B compared to previous quarters. Strong performance in the Baltics, execution of the Business Transformation Program and lower commercial spending in Sweden led to an underlying EBITDA growth of 8%. We continue to invest in 5 gs in Sweden, So we are not yet at our full year run rate, which you can see in our CapEx for the quarter. We expect to increase the speed in the second half and onwards as we ramp up the 5 gs rollout in Sweden and eventually start in the Baltics once we have acquired the spectrum. During the quarter, we paid out SEK3 to our shareholders, which was the first half of the ordinary dividend. And in July, we paid an extraordinary dividend of SEK3. The remaining SEK3 of the ordinary dividend is scheduled for October, meaning that we will have distributed SEK 9 this year to shareholders. This is in line with our ambition of having a superior shareholder return. We successfully combined 2 of the most iconic consumer brands in Sweden into 1 strong premium brand, which concludes the first phase of our FMC journey. During this phase, we have shown that we're willing to take responsibility in the market Through our value based strategy, we see that our more for more price adjustments are now improving the top line. With roaming revenues now roughly at the same level as last year and other areas that were particularly affected by the pandemic such as TV and mobile prepaid stabilizing, We were able to grow the Sweden B2C business for the first time in a while. In Sweden B2B, we continue our multi segment approach to take market share within SME, increase profitability in large private enterprise and defend our position within the large public enterprise segments. The initial results are promising, and we see that the new mobile portfolio for small business launched in the Q1 is starting to bear fruit. While it will take some time to turn the B2B business back to growth, we start to see the end user service revenue shifts materializing, and we are on track toward stabilization in 2022. We see the fantastic performance in the Baltics continue with strong end user service revenue and underlying EBITDA growth. This is done through our more for more strategy as we monetize the increased demand for data and leverage our different market positions in each market. Let's now move over to the Swedish Consumer segment on Slide 4. The consumer market is in a similar state as the previous with lower activity due to COVID-nineteen restrictions. Together with the price adjustments, which always come with slightly elevated churn, This led to a negative net intake in mobile postpaid. In fixed broadband, we really saw how resilient the business is as net intake remained relatively strong despite headwinds from the pandemic, pricing adjustments and the removal of one of the most well known fixed broadband brands in the Swedish markets. Price adjustments in postpaid and fixed broadband supported continued ASPU growth in the quarter. And cable and fiber TV ASPU turnaround as the revenue from Premium Sports is back. Total end user service revenue increased 1% as growth in mobile for space fixed broadband and cable and fiber TV compensated for a continued decline in legacy services. Then let's move on to B2B on the next slide. Mobile net intake was positive with 10,000 revenue generating units in the quarter, driven by improved net intake in the small segment and new contracts within the large segments. Mobile outlook continued to decline, although at a lower rate as roaming headwinds neutralized in the quarter. While we saw improvements within mobile and solutions, total end user service revenue declined by 2%, mainly driven by continued decline in legacy fixed Services. On the whole, I would say the performance is in line with the trajectory we laid out at the Capital Markets Day. We are seeing a trend shift, which should continue throughout the year and then lead to stabilization in 2022. The price pressure, of course, persists since it is a tough market. However, after trends are already improving slightly compared to previous periods, even if you exclude roaming. While we have a journey ahead of us to get back to growth, I think it's a good sign that we can get volume growth while maintaining discipline on prices. So then let's turn to Slide 6 for the hold of Sweden. End user service revenue was flat in Sweden has growth in B2C compensated for decline in B2B. Underlying EBITDA increased by 7% through continued execution of the business transformation program, lower commercial spend and less headwinds related to the pandemic. We continue to see strong cash conversion of 65% despite increased CapEx related to the 5 gs rollout in Sweden and IT investments related to the business transformation program as we keep growing underlying EBITDA. And then let's turn to Baltics on Slide 8. We saw strong net intake in the quarter for the Baltics, driven by mobile postpaid in Latvia and Lithuania. We continue to see strong ASTRU growth due to continued monetization of data, driven by price adjustments through more for more campaigns and a slight recovery of roaming revenue in Latvia and Estonia. Now we'll turn to the next slide, please. We continue to see fantastic financial results across the Baltic markets. End user service revenue increased by 13% in the quarter with strong growth across all markets as COVID-nineteen headwinds started to abate and showed signs of slight recovery. Higher end user service revenue led to an underlying EBITDA growth of 10% on an organic basis. Strong growth in underlying EBITDA together with low capital intensity as we are in between investment cycles ahead of the 5 gs launch and the Spectrum acquisition, overall led to an 83% cash conversion. With that, would like to hand over to Mikael to go through the financial overview. Thank you, Kjell, and good morning, everyone. Please turn to Page 11 in the presentation. As in previous quarters, we have taken this slide to illustrate each revenue line excluding roaming. Please keep in mind that the organic growth numbers on the slide are adjusted for FX changes. As we can see on this slide And as Kjell previously mentioned, we now see some pandemic headwinds starting to abate in the quarter and in the comparable figures we have for the first We have, for the first time, a full quarter of COVID-nineteen impact. As a result, we see outbound roaming giving a slight Tailwind of SEK 18,000,000 for the group in the quarter, but we are able to grow end user service revenue even if we exclude this from the numbers. Mobile postpaid grew by 1% ex roaming, and fixed broadband increased by 5%, Driven primarily by price adjustments. We saw most of the effect of the price adjustments this quarter, and we expect the full effect from Q3. As premium sport content now has returned, we are able to grow our cable and fiber TV business with 3% compared to Q2 2020. However, it did not fully compensate the continued decline in the legacy DTT business, Resulting in digital TV end user service revenue declining by 2% in the quarter. Total end user service revenue in Sweden B2C See, grow by 0.3% in the quarter, excluding roaming, as growth in mobile postpaid, fixed Broadband and cable and fiber TV was offset by decline in legacy services. In Sweden B2B, Slightly improved trends within mobile and solutions were not able to fully compensate for the continued decline in fixed legacy services, And end user service revenue declined by 2%, excluding roaming. And in the Baltics, we see continued Strong performance, resulting in 12% growth in end user service revenue, excluding roaming. And this was driven by high ASPR growth on the back of price adjustments through our more for more strategy and also pre- to postpaid migration. All of this resulted in the group growing end user service revenue by 1.6% excluding roaming And 2.0 percent including roaming in the quarter. And this marks a turning point From the negative growth numbers we have seen for the group over the last quarters. Let's move on and turn to Slide 12 for a walk through of the group results. Continued strong development in the Baltics, Execution of the business transformation program in Sweden and lower commercial spend drove an underlying EBITDA increase of 7% Organically. Items affecting comparability was roughly at the same level as Q2 2020 and was mainly driven by Structuring costs related to the business transformation program in Sweden. Depreciation and amortization increased During the quarter, as we now start to amortize the book value of the Com Hem brand following the merger with the Tele2 brand in the quarter. We also saw some impairments related to the IT transformation in the quarter. The release of a provision related to a tax Dispute with the Swedish tax authorities resulted in a positive non cash effect in the quarter of SEK 21,000,000 on net interest And SEK 350,000,000 on income tax. Let's continue by looking at cash flow on Slide 13. Timing of Customer Equipment CapEx in Q2 last year led to a decrease of CapEx paid this quarter compared to Q2 2020. We saw a positive change to working capital in this quarter, and that was primarily explained by external handset financing in the Baltics. Taxes paid were affected by timing of withholding tax on intercompany dividends from the Baltics. And finally, we continue to see strong cash flow generation with equity free cash flow of roughly SEK 1,300,000,000 in the quarter SEK 4,700,000,000 in the last 12 months, and that is equivalent to roughly SEK 6.8 per share. Please move on to Slide 14 for an overview of the capital structure. Leverage was unchanged Compared to last quarter, as growth in underlying EBITDA was offset by the distribution of the first tranche of the ordinary dividend in April. We continue to be in the lower end of our target range of 2.5x to 3x, ahead of the extraordinary dividend, which was Paid out in the beginning of July. If we adjust for this, leverage would have been 2.7% end of June. So, so far this year, we have distributed SEK 6, and in October, we'll pay out another SEK 3 Sure. That's the 2nd tranche of the ordinary dividend. And we can do this while maintaining our leverage comfortably within our target range. On top of the underlying cash generation of the business and relevering effect of growing underlying EBITDA, A potential exit and distribution of the proceeds would not affect our ability to distribute cash to shareholders and maintain a very generous remuneration policy afterwards. Let's continue with Slide 15, we'll show an update of the business transformation program. We continue to execute on the program and we reached an annualized run rate of SEK 350,000,000 at the end of Q2. This resulted in SEK 80,000,000 in cost reductions Quarter comes from efficiency improvements within the technology, IT and commercial organizations as well as support functions. We remain committed to reach roughly half of the SEK 1,000,000,000 target by the end of this year and the rest by the end of 2022. And with that, I will hand back to you Kjell to go through the updated guidance and our key priorities going forward. Thanks very much, Mikael. So then let's please turn to Slide 16 to go through our updated financial guidance. As society gradually returns to normal, we see that the negative effects from the pandemic start to abate. As a result, we are more confident than we were in February when we gave the 2021 guidance. Hence, we update our 2021 guidance for end user service revenue from flat previously to flat to single low single digit growth and underlying EBITDA from 2% to 4% growth previously to mid single digit growth. The guidance for CapEx excluding spectrum and leases remains unchanged as we aim to ramp up the 5 gs rollout in the second half of the year. With a 7% growth in underlying EBITDA in the Q1, this full year guidance, course implies a slight slowdown in underlying EBITDA growth in the second half of the year. The reason is that while the current market environment is good for our margin it keeps commercial costs down, we want to make the necessary investment to achieve a sustainable balance between volume and price in order to grow end user service revenue sustainably. So if mid single digit growth is 4% to 6%, you should not expect us to be in the upper part of that range since we want the flexibility to invest in growth in the second half, so that we can hit the ground running in 2022. Please turn to Slide 18 for our key priorities going forward. With the strategy and mid term ambition set out at the Capital Markets Day in May And with a post pandemic society on the horizon, it is time to recalibrate our business towards a strong focus on growth. This includes investments that are essential for delivering a great service and customer experience, while solidifying our premium position in the market by balancing volume and price through our more for more strategy. In Sweden, we will continue to execute on our infrastructure investments, both in the mobile and fixed networks with 5 gs and Remote PHY. We are on track with our plan to ramp up during the second half and aim for the higher end of our CapEx guidance range during 20222023. The execution of the business transformation program is progressing well, and we stay committed to deliver an annualized run rate of SEK500 1,000,000 at the end of this year and at least SEK1 1,000,000,000 at the end of 2022. In Sweden B2C, we will now enter Phase 2 of our FMC journey with a new consolidated Com Hem and Tele2 brands. While the first phase was all about building loyalty in the existing overlap among our fixed and mobile customers, The second phase will be focusing will offer focused on offering a truly convergent customer experience under 1 single brand by cross selling to the 1,300,000 non FMC households within our fixed footprint that are only one of our services. The emphasis, however, will be on the value based FMC strategy to gradually increase penetration in our customer base. Sweden B2B is starting to become a good story. The B2B market has never been an easy market. With a solid strategy in place, the internal parts are in place, and we now need to shift from planning mode to execution mode to continue the trend shift in 2021 and move to stabilization in 2022. In the Baltics, We'll build on the current momentum and execute our mobile centric conversion strategy through more for more offers, while preparing for a nationwide rollout of 5 gs once the spectrum auctions are concluded. We'll also further develop our FMC opportunities by looking at our own and 3rd party infrastructure capabilities. I'm also very happy that we were able to announce a strengthened group team earlier this week with Charlotte Hansen joining us as a CFO and Henry de Groot as Chief Commercial Officer. Chalo brings broad and valuable experiences from a number of industry, while Henrik is the commercial FMC expert that we need in order to achieve in Phase 2 of our FMC journey. I look forward to working with both of them. With yet another strong quarter behind us, I'm more confident now than ever that we will deliver on our mid term guidance and achieve our ambition to become the leading telco in the Nordic and Bolting region. With that, I'll hand it over to the operator so we can move to Q and A. Thank you. Ladies and gentlemen, we will now begin the question and answer session. And the first question comes from the line of Andrew Lee from Goldman Sachs. Please go ahead. Good morning, everyone. I had a question around the declining parts of your business and the improvements you've had within those In the Q2, so specifically digital or digital and TV and B2B, I guess Key investor question is how sustainable are those improvements and the direction of travel. So on digital TV, You had been saying that you could stabilize digital TV trends in the second half of the year, I think. Obviously, you've And then on the B2B side, you mentioned you reiterated a couple of minutes ago, Kjell, that We'd look to stabilize it we'd look to see stabilization in 2022, which is what you said at your Capital Markets Day, but Obviously, a bigger improvement in B2B than people expected in the Q2. So is there scope, do you think, to actually see Stabilization sooner than 2022, for example, in the second half of the year. Comments to reassure on the sustainability of the improvement would be really helpful. Thank you. I'll start on B2B and then Samir will talk a bit about TV afterwards. Yes, we are very happy to see that the B2B has made significant improvements throughout the last couple of quarters. That's very, very helpful for our top line for sure. Yes, it would be very nice to see the run rate stabilize at the end of this year. I have just emphasized that we are on track and we're getting there because it was a big concern for you guys, for me and for everyone as 3 quarters ago. And now we are quite confident that we are getting back to stabilization. We will work as hard as we can to bring that to run rate stabilization by the end of this year. That is, of course, an ambition that we would like to have. And maybe to the TV side. Yes. So hi, Andrew, and good morning, everyone. Samuel here. So for TV, As you know, we have a strategy to continue to modernize our TV business and in that way stabilize it, maybe not reaching growth Sustainable, but at least stabilize it. And if we take out the kind of premium headwind that we see in Q2, We are definitely seeing an underlying improvement also without that premium part. So the trajectory is Positive also underlying for TV. Thank you. That's helpful. Thank you. Next question comes from the line of Maurice Patrick from Barclays. Please go ahead. 2. Good morning, guys, and thanks for hosting the call and a question today. Just one question really around your Value versus volume. Such as I mean, it would seem pretty clear over the last few sort of quarters you've been wanting to pivot the company more towards Value, maybe rather than just volume approaching it over the past. But in your statements today, you seem to indicate a desire to sort of increase The market activities to get a platform for growth from 2022. So maybe just a few thoughts around that value versus volume Trade offs and how you're thinking about that? Thank you. Yes. Just so there is no misunderstanding. I do not want us to Shift was becoming very volume focused. Again, that is not what I'm saying here. If you look at the market activity in the second half of last year, it was a quite It was quite heavy activity going all the way from the iPhone launch via BlackWigs over towards Christmas and lasting into January this year. Now we have seen less activity from, say, mid January throughout the first half of the year. And I think it's only natural to expect When we get back to the typical September, October activities at Christmas, there will probably be more activity than we've had in the first half of the year. And that is, to some extent, the volume gain. But I just want to be very, very clear. We believe that the long term sustainable growth stems from a value focus, not from pushing volume. But it's important to relate to the fact that we are operating in in a market. We are looking at what happens around us. We have taken a lot of responsibility by being very strategic, and it's our ambition to do so if the market permits. Otero. Ken from ABG. A question on convergence, please. You seem very confident That you can drive convergence going forward and clearly to a higher degree than has been the case in the past. And you're also stressing that you're sort of adding some new competencies within FFC Convergence. I understand that you have moved towards one single band up. But what makes you so Confident that you and what will make the big difference in your convergence efforts going forward? What is it that will be done differently? Can you enlighten us a bit on why this will suddenly why we should see a step change in convergence and the contribution from that? That would be appreciated. Thank you. And if I can sneak in a technical question for Michael, a quick one. Michael, for how long should we assume that the incremental amortization of the Com Hem brand We'll continue, please. Thank you. So let us be clear, of course, there will always Also in our customer base be people who want to have a clean mobile only product or another straightforward relationship to us, and we will cater for that. But we think that one of the best ways to bring value to us as a company and also to Our customer base is to have a better convergent solution. Samuel has started that work, done a lot of work on that. He has actually worked together with Henrik defining our strategy here. So these two guys, they have done it together. So there will be a continuity here that is I think is very good. We have unique assets. There are 2 players in this market that really have the full suite of convergent assets. And that gives us the opportunity to have a bit of uniqueness compared to the 2 other players in the market. We have talked about that multiple times. So it's about utilizing the assets we have, making sure that that 1,300,000 Customer group that we can address as it within our own base gets the best possible offering. And that sets us a bit apart from, for example, Tare, who will naturally follow more of a mobile only approach. And that's the right thing for them to do. That's a good thing for them to do. We have more Asia sub parceles we can go for different segments that we are better suited for catering for. And yes, Mikael, I guess you want to answer the other one. I can do it, of course. Yes. So I can do it. It will be amortized over 10 years. So this is the new run rate level you will see going forward of amortization and depreciation. That's great. Thank you, Michael. Thank you, Karel. Thank you. Thank you. Next question comes from the line of Nick Lyall from Societe Generale. Please go ahead. Yes, good morning, everybody. It was just a quick one on maybe for Samuel actually on the Telia pricing, Including content in the unlimited mobile package. Is that something that's an opportunity for you, do you think? I mean, it's quite a high Price that offering by adding content in. So is that an opportunity for you to undercut ex content? Or do you think the Swedish consumers are going to start to require more content In their top end mobile packages and maybe that's something you have to work on, particularly with Champions League coming. And do you mind if I Yes, a clarification as well on the infrastructure comments you've made as well, Sheldon. There's nothing outside the Baltics in there. So should we conclude now You're still doing the work? Or have you finished the work on any of the Swedish infrastructure? And maybe it's just more organic stuff With Telenor, but nothing more than that? Thank you. So if I start on the first question, Henrik. I mean, Including content in top tiers, I don't think it's a must. So we don't have to do it, but you can do it. 2. So let's see. But I think in general, we talk about the value led strategy and Teerla talk about the value ladder strategy, and this is a proof point of that driving the market in the right Directions, and of course, that's an opportunity for us. In general, I don't think we have to grab that opportunity by including content everywhere, though. And on the infrastructure side, I think I would say that we're still working on that. And it has to do with, I'm sure you know very well, How the structure is on the 3 gs market in Sweden with us and Telia, Tunab and then of course Trea and Telenor in Trigis. So we're untimely in these things, redistributing, setting up the net for mobility. So We're taking it one step at a time. I know it's very fashionable to move fast on these things, but With our balance sheet and our delivery now, we will make sure we do this in the right sequence and that we if we do something more around this, then it will be very well thought through. But we are super pragmatic about how we configure our value chain. That's great. Thank you very much. Thank you. Next question Comes from the line of Stefan Gauffin, DNB Bank. Please go ahead. Yes. Hello. CapEx Question, it's a lot of talk about 5 gs CapEx, but you're also investing in Remote PHY. How much will you invest in this? And can you talk about what improvements in the cable network that we can expect from this In terms of improvement in speed and capacity. And is this investment in Remote PHY Also supporting your 5 gs plans in any way? Thank you. Yes, there were several things there. First of all, I mean, the CapEx is distributed on, of course, Building the 5 gs, it's on remote PHY. And then Sweden is a little bit unique in that it has quite a lot of people who work Sort of with our own company and selling consultancy services, some of that is also part of our CapEx. So it's divided into different areas. The Remote PHY investment is clearly to support both our Cable TV business with reliability and speed and for our broadband business. So it's basically We used to say before we talk about bringing Frankfurt to the customer in terms of you're building fiber closer and closer and closer to base stations. This is what we're doing, building the fiber closer and closer to the customer living in a building. So it does enhance the speeds. And Yogesh, if you remember, at our Capital Markets Day started talking about the 10 gs. So it's there is always another gs. So on the Capital Markets Day, he presented this. That's also available on our website to go through a more of a presentation what is said there. I don't know, do you want to say something more about the CapEx, Nico? Or I think we can if you talk about the CapEx levels, I think it's important to remember that this is an investment Which will be ongoing for many years, 5 plus years. So if you spread it out over these years, The number per year is not that significant compared to the 5 gs rollout. And also bear in mind that this replace we used to do with node splitting in the past 2. To cater for building capacity. And this is the new way of building capacity. So it replaces other CapEx, which we used to do before. So it's not just add on. I think that's important to remember. And maybe just to add from a customer perspective, this will generate market leading symmetrical speeds for broadband. So that's, of course, important to underpin the journey we're doing on convergence and quality. Okay. Thank you. Thank you very much. Thank you. Thank you. Next question comes from the line of Uli Ulrich Rathe from Jefferies. Please go ahead. Yeah, Thanks very much. You had a very strong Q1 result as well. And at the time, you were sort of a bit cautious To readdress into the full year, you talked about the commercial investments you want to make. Now in the second quarter, Again, you sort of haven't quite dipped into that commercial investment. I think that's part of the surprise versus market expectations. Could you sort of just get a bit more into give a bit more color what elements of the development in the second quarter We really gave you the confidence now to raise the full year guidance, whether it's The efficiency program, whether it's the market environment or whether it's the actual numbers that are coming out of the business, that would be helpful. Thank you. Well, I think let me start by being maybe not 100% serious. It's easier to earn yourself into becoming a millionaire or billionaire to save yourself into. So I think at some point, the focus needs to go back to getting a modest amount of growth. And I think that time already has come for us. We are starting we started that shift. And to build long term value, we need to have a focus on growth. We will Continue to be an efficient operator, but if we focus only on savings, that's not going to build a really long a good long story. I wouldn't say that there is one specific thing that causes us to adjust the guidance. I think it's several things coming together. I talked about B2B. B2B was a huge drag on our performance. It is not a huge drag on our performance anymore. We can still improve and we will improve. It's super important that Simon and the team have brought us back to growth in B2C in Sweden. So we clearly see that this is sustainable and that is something we can build upon. And then, of course, we have exceptional growth in the Baltics. We think that will continue to grow, but that growth will, of course, come down some point, we cannot have strong double digit growth there forever, and we have we all understand that. So it's a confidence that is building quarter by quarter as We see that we are more precise in our strategy that we have presented, our segmentation. We start seeing that the market responds to our strategic price setting in the Swedish market and our Ability to deliver our services is improving as we go through an improvement journey. So it's several factors that come together and makes us feel more confident. Plus the fact that we are more confident that At least for Western Europe and some and OIGD, we probably will get out of this pandemic this year in a reasonable way, although the rest of the world still has a big problem. Thank you very much. Thank you. Thank you. Next question comes from the line of Andres Kavijev from UBS. Please go ahead. Hi. Thank you for taking my question. I would like to ask about the new appointments that you've announced, in particular about the Chief commercial appointment is quite a sensitive position for Tele2 currently. So first of all, can you confirm that there will be a roughly 1 month overlap And both deals kind of are together as well as to in August, which could improve somehow the succession process. And secondly, can you just give a bit of a background as to what led you to choose Henrik and what experience of it specifically makes them be by Christian, for everything that Tele2 is currently going through commercially. And then if I may just also sneak in a clarification please on the Amortization of the Kompen brand, does that or does that not carry a tax shield? Thank you. Yes. So It's very good news that Henrik comes along here already in August, that allows for an overlap. But in real life, that overlap has already started because Samuel asked Henrik to help him with challenging some of our strategy work. So the guys have actually had a dialogue around the B2C strategy for some time. And that is a huge strength for us so that when Henry comes here, He can hit the ground running. And Samuel is an extremely loyal person, so he will be helpful until the last day the way I know him. So this you couldn't ask for a better transition than what we see here. And the team have already been introduced to Hendrik. His background, He has a lot of experience within FMC, but he also knows the TV business, the cable TV business from his time as he go. And when you look around at candidates for these kinds of jobs, you either often find a typical telco CMO, which and some of them are fantastic. Or you find someone who's working with KB and who's doing a great job there, but someone who has that Experience from both in the broad way, in a way like Samuel does here, there are not that many out there. So I think we've made a very, very solid choice here that's going to be helpful for us. And then you asked Something about, again, the amortization of CompHem. I think Mikael answered that, that it's going to be done over 10 years. Was that the question? No. And I can clarify that there is no paid tax effect on this. But of course, there is a deferred tax Booked on the amortization. Markus and Patrick can give you the details of this and the numbers, But no effect on paid tax. Thank you very much. Thank you. Next question comes from the line of Abhilash Mohapatra from Berenberg. Please go ahead. Great. Thank you. Thanks for taking my question. Just a quick question on the some of the revenue improvement drivers in Q2, please. And just on TV where you mentioned that with sort of premium sports coming back, you've seen a return to stronger As fuel levels, my question just was, is Q2 a sort of normalized run rate? Or should we expect more improvement as some of those elements return into the second half? And then just related to that on the solutions revenues, Just wanted to check if there was some sort of catch up effect from previous quarters and or whether we should expect this to be the kind of run rate The Solutions revenues going forward? Thank you. So if I start with the TV question then. And as I said, We will have some headwind on comparisons for premium both in Q2 and Q3, and I think it's More or less evenly divided if you compare it to last year. But if you skip that, we also see an underlying improvement Within both, the former Com Hem TV part and also some in Voxer. And that we expect to continue with the strategy we presented at the Capital Market And you are addressing the Solutions business. Yes, there is some effect on that. You're very well spotted, But it's not so big that, that changes the overall picture. So I'm Very happy with the way Stefan is stabilizing that business and moving it back towards, hopefully, growth. Got it. That's very helpful. Thank you. Thank you. Next question comes from the line Siyi Hai from Citi. Please go ahead. Hello. Thank you for taking my questions. And just the third question I want to ask about the price increase potential. And this quarter, we're seeing that Telia announced one of the biggest Fiber price increases over the past few years. Just wondering how do you think the potential price increase and ARPU growth On fixed broadband going forward, I think broadband ARPU growth is now 1% to 2%. Do you think there's potential To go back to the 3% to 4% as we saw in the past? And the second question, just a quick follow-up. On your management team, would you mind to remind us how many key management seats that you still plan to fill? And should we expect a more stable Hotel 2. So if I start with pricing, and then I want to come back To our strategy and the way we do pricing, I mean, we have a very clear, as you know, value led strategy. We have a clear process on how we work, Where we do focus a lot on adding value, working with the front book in the second half of the year. And then in the first half of the year, We do the back book. And we're just now coming up of the back book exercise and now starting to look forward into kind of the next part of the cycle, the value on the front book. And When we do that, we look at 2 things, if you want to simplify it. 1 is, of course, what's happening in the market and what kind of potential that, that brings. And the other thing we're looking at is our own ability to provide value to our customers. And with other players in the market working the 2. Working the same way and working with the value led approach that, of course, plays Into our decision material. So on the question, do we see continued pricing potential? The answer is definitely yes. But I'm not going to go into exactly the percentage points of that. But we do see potential, and that is definitely part of the I think we should take a little bit of a historic look at this. Tele2 and ConHem came together And some people who have been stuck in this management team have been around for a long, long time. We're talking about, in Samuel's case, 14, 15 years. And we have had Yousszum Mikael has been the CFO in different capacities now for a long, long time. So I think to some extent natural that when the first phase of this job is done, people who have spent a lot of time with a company and reached sort of the top level, would like to try to do something else with their lives. I've been in exactly that situation myself, so I know exactly how that works. And now to your question, should we expect more stability? Yes, you should expect more stability within the top management team. We are moving ahead. Sharav joins us in January. We have the interim solution with Peter. Mikael is on board until the first September, so we have a team in place now that looks to the medium to longer term. And I think that we've been able to put together a strong team. And we can build on the strategy that has been developed partly actually with 1 or 2 of the people coming in helping us, but with this team. And I can tell you when we have our management team meetings, we share a good laugh. There's a good tone. It's just at some point when you've been around for a long time, you want to move on and try something new. That's very clear. Thank you very much. Thank you. Next question comes from the line of Jenny Coutinho from Credit Suisse. Please go ahead. Hi. Thanks for taking my question. My first question is on operational side in mobile. So for the past three quarters, you've had B2C postpaid mobile negative growth in net adds. However, your competition has been growing quite well in the postpaid net adds. And I'm just wondering Why is that trend? And how are you seeing that going forward? And then my 2nd question, sorry, maybe I've misheard your previous comments on infrastructure. Can you give an update on your thoughts On your towers in Sweden and potential monetization of those assets going forward? Thank you. Yes. I can start with the net adds question. So I mean, if we look to this first half Of the year, we know we had some challenges in the Q4. We were very open about that and talked about it, which has improved. And then I think we have taken a very big strategic responsibility, being very clear on the value led strategy and also being a bit patient On that to make sure that we get that piece moving in the right way. We have had the pandemic impact, which, of course, That's hampered volumes, and we've done a lot of pricing in the first half year. So I would say all of this has been by our Decision and design. And now when we come out of the back book pricing, Saket, we come out Of the worst headwinds of the pandemic, we naturally see that there is a potential to improve also the volume side. 2. So not a big worry on our part, rather decisions we have taken on how we want to structure this business going forward. Yes, I fully agree with what Simon is saying. I think it was important for us to show exactly how we operate and want to operate and how we want to set in the market. But we are not going to sit and watch, of course, volumes going against us over time. But I think the learning we've had now is that it has been a Worthwhile exercise that has given good results. And back to infrastructure again, yes, I think it's fair that you ask and I when I came in here, I started talking a bit early about infrastructure. So maybe I have traded some expectations with you. The reality of it is we are untangling, like I said, the 3 gs networks. We are dividing the hours between ourselves, what we're going to bring from Sunab into the 5 gs network in Metro Mobility. And then of course, we have improved relationship with our partner Telenor in for Mobility. And we are taking ourselves we are taking the time we need to do the proper analysis. So, some very high graded expectations around timing at an early stage when I was here that leads to you thinking that we should have announced something at this stage. I can only say that We are entirely pragmatical pragmatic about how we structure our value chain, but it's too early for us to conclude and communicate. Great. Thank you. That's very helpful. Thank you. Next question comes from the line of Adam Fox Ramley from HSBC. Please go ahead. Thank you very much. I was wondering as we fully annualize the Impact of the COVID-nineteen pandemic on the business this quarter. Could we get your thoughts on the bad debt provision taking last year and how you're Thinking about the outlook for your customer base is maybe some of the restrictions look to be lifted, if that's your outlook. And then secondly, sorry to come back to this Com Hem brand amortization, but what's the reason for a 10 year lifetime. When you're bringing 2 brands together, that seems like quite a long time to me. So I appreciate a little bit more detail there. Thank you. I will start and I hand over to Mikael, I think. Please remember that even though we've done this merger, the Com Hem brand is still with us. It's It's in our logo still partly, but of course, you have to have been a Codman customer for some time to see that. And secondly, we have Com Hem Play Plus. We have so Com Hem is still a part of Tele2. And this is the best way we have come up with together with the auditors for doing this. Before, we didn't depreciate it at all. So it is a quite well analyzed approach to it. I don't know Mikael if you want to add something to it. No, I think you put it very well. It's still in the logo, And you have certain attributes. It's still used in the Colmheim place, service, TV service, for example, and so on. And that motivates 10 year depreciation time. I can then add on the bad debt Provisions. To remind you all, it was SEK 35,000,000, which we provided for in Q1 last year. And as we have said before, this will We have not seen any material bad debt coming up over the last quarters, and I think the situation is very stable overall. This provision will be released over time, but it's again, SEK 35,000,000 in this group is really material. So you will not it will not be visible in the numbers. And this it's part of the continuous reassessment. We do have the Bad debt provision every quarter in every or every month in every country. Got it. Thanks very much. Thank you. There are no more questions at this time. I hand the call back over To Shane Johnson, please go ahead continue. Then I would like to thank you all for taking the time to join us today to listen to our Nation and to discuss with us the quarter and our guidance and where we are today. Very happy that we could deliver a strong quarter that we are able to lift our guidance a bit and of course that we also have been able to The quarter ended to pay out the extra ordinary dividend. So I think we're on track. But in a couple like this, there will always be a lot of work 2. And we are continuing with our transformation program, and we are continuing building the premium position for Tele2. So we will have lots of interesting stuff to speak for the next quarter. But thank you for joining us today, and have a very nice day.