Good afternoon and a warm welcome to Polsat Plus Group's Earnings Conference for the Second Quarter of 2025. Can I have the next slide please? Before we begin, let me introduce our speakers: Andrzej Abramczuk, President of the Management Board, Maciej Stec, Vice President for Strategy, and Katarzyna Ostap-Tomann, Chief Financial Officer and Management Board Member responsible for ESG. To ensure a smooth discussion, please feel free to submit your questions via the Q&A panel at any time during the presentation. Kindly include your name with each question as we do not accept anonymous questions. Thank you in advance. Next slide please. Now, without further ado, let's go ahead with the presentation. Andrzej, the floor is yours.
Good afternoon, ladies and gentlemen. Thank you for joining us today. It's a pleasure to welcome you for the first time at the result call of Polsat Plus Group. Before we dive into today's agenda, allow me to briefly introduce myself. My name is Andrzej Abramczuk. I have dedicated over 25 years of my professional career to the telecommunications industry. For more than 15 years I have worked with Polsat Plus Group in various roles. For the past seven years I have been CEO at Netia and currently I am honored to additionally head Cyfrowy Polsat, and Polkomtel. Some of you may remember me from similar meetings when Netia and Midas were publicly listed companies. Before we dive in the presentation, I would like to emphasize that my priorities uphold the advanced long-term strategy of our group, ensuring continued growth and stability for all our stakeholders.
Going over today's agenda, first we will highlight the main events in the second quarter. After that we'll discuss our operating and financial results. We will end with a short summary and take your questions. Let's move to the next slide, please. This was a solid, stabilized quarter for our group in the telecommunications space. The main highlight was the launch of our new flexible multiplay offer which helped us build the value of the customer base. Maciej will share more details about this soon. In our media segment we saw strong growth in viewership which aligned with long-term strategy. This gives us a solid position in the advertising market. At the same time, our online division, Grupa Polsat-Interia, remains the leader in the Polish internet market.
Green energy, i'm proud that we have finished the installation of all 63 turbines at the Drzeżewo wind farm and most of them are already running in the test mode. Our company, Biopaliwa i Wodór, also won a capacity market auction and secured 44 MW of capacity obligations starting in 2029. This contract is expected to bring in about PLN 400 million over 17 years. We have also secured an investment loan of almost PLN 1 billion for the Drzeżewo wind farm. I am especially pleased because this shows that the financing institutions have strong confidence in our group, our management, and our strategy. Now, on the right side of this slide, you can see the numbers. We made PLN 3.6 billion in revenue this quarter, up nearly 4% compared to last year. Our adjusted EBITDA stays strong at PLN 824 million.
ARPU per B2C customer continued along a steady growth path, up to 4.3% year on year. We now have over 3 million multiplay customers using an updated definition which Maciej will explain soon, and this base is also growing. Our audience went up to 22.5% and Green energy production grew by over 40% to 314 GWh in the second quarter of 2025. Let's now move into the details. Maciej, the floor is yours.
Good afternoon and welcome. As always, it will be my pleasure to present the operating results of our business segments. Can I please have the next slide? I can say that this was a very good quarter for our media segment, both in TV and in the Internet. Let's move to the next slide, please. I'm very satisfied with our viewership figures and our strong position in the advertising market this past quarter. Let's get right to the numbers. The audience share of TV Polsat Group channels grew to 22.5%. Our thematic channels contributed a solid 15.2% while our flagship channel Polsat secured 7.3% of audience share, proving that our programming choices are well received by our viewers. The advertising market grew by 3.2% year-over-year. I'm proud to report that our TV advertising revenues grew in line with the market, increasing to PLN 373 million in Q2 2025.
We maintained a stable market share of 28.2%. It's always better to look at the performance in the media segment over a long period of time to smooth out seasonal effects. Let's see the results for the first half of the year. Can we have the next slide, please? Our performance over the past six months was also very good. Our main channel delivered a solid 7.4% audience share in the commercial group, adding 14.9% of our thematic channels. We have a total of 22.3% and that is an increase by half a percentage point versus last year on the advertising market. We clearly outperformed the market in the first half of the year. Our advertising revenues grew by 3.7% year-over-year, outpacing market growth of 2.2%, which is an outstanding result. Our market share grew to 28.4%. Next slide, please. Now let's talk about the Internet once again.
Polsat-Interia Group is the number one Internet publisher in Poland. Not only that, we are also a leader in the mobile category. That is really good news because today everybody is basically glued to their smartphones and this is a prospective market for us. Let's look at the numbers. 21 million real users and nearly 2 billion page views monthly, and these figures clearly demonstrate Polsat-Interia's strong position in the online market and will continue to strengthen our presence. Next slide, please. Our strong results in the media segment this quarter were driven by a very successful spring programming lineup and smart investments in engaging sport events. We built our spring schedule around well-known popular shows and series that our audience loves. On top of that, we offered our viewers many attractive sports broadcasts that drew massive attention.
The Volleyball Nations League was a sensation, especially with the Polish team winning the championship. Tennis fans got a treat too, seeing Iga Świątek take home the Wimbledon title. Of course, Formula 1 races and football, Bundesliga, La Liga, UEFA Europa and Conference leagues all remained hugely popular. Next slide, please. Let's move on from media to telco. Next slide, please. As Andrzej said at the beginning of the presentation, one of the key highlights of this quarter was the introduction of our latest multiplay offer. It's simple, it's ultra flexible and most importantly, it's designed to drive ARPU growth by letting customers mix and match what fits them best. Why is it so simple and transparent? You start with any two core services for just PLN 80.
You can pick a mobile subscription with 180 GB of data or fixed line Internet up to 600 Mb/s or LTE/ 5G mobile Internet with up to 600 GB or TV package with Polsat Box and 85 channels. If you want more, just add another service from our portfolio for PLN 30 a month. Maybe another core service, two streaming platforms or the L package upgrade. You get three services, you pay PLN 110, you get four services, you pay PLN 140 and so on. Extra simple, no hidden catches. Bottom line, we've made it easy for customers to build their own bundle, get real value and see exactly what they are paying for. No surprises and no confusion. At the same time, our new multiplay offer helps us focus even more strongly on driving ARPU growth going forward. Next slide, please.
The simplified multiplay strategy has led to a clearer definition of our multiplay customers. Under this new definition, we now have over 3 million multiplay customers. Any customer using at least two services, any two services, even of the same type, from any company within our group is counted as a multiplay customer. Previously, our definition only covered customers participating in loyalty programs such as SmartDom within individual companies. To give you a clearer picture, let's look at the numbers. In Q2 2025, under the previous definition, we had over 2.5 million multiplay customers. We now also include 209,000 customers with two or more services across different companies and 268,000 customers with multiplay services of the same type. This brings us our total multiplay customer base to a little over 3 million. On the bottom graph where we stated historical data to ensure transparency and comparability.
Under the previous definition, in Q2 2024 we reported 2,477,000 multiplay customers, which was 43% of our customer base. With the new definition, this number increased to 2,964,000, representing 51.5% of our base. In Q2 2025, under the old definition, we would have reported 2,536,000 multiplay customers. While using the new definition, we have 3,013,000 multiplay customers. I would like to underline that this updated definition is intended to give a clearer and more accurate view of our customer base and the potential ahead of us for saturating this base with additional products and services. Let's move on the operating results on the next slide. As I've already said, we have over 3 million multiplay customers and we maintain a high and stable base despite challenging market conditions. This base increased by 1.7% or 49,000 multiplay customers year-over-year thanks to our successful upselling strategies.
Today, 53% of our total customers use our multiplay offering. Our multiplay customers have 10.6 million RGUs, up by 832,000 year-over-year. A larger part of this increase was driven by the uptake of additional services under our new multiplay offer. I'm also very happy with the evolution of our churn rate, which decreased to 7.1% in Q2 2025. The consistently low level of churn reflects strong customer satisfaction and loyalty. I expect that the new multiplay offer will help us keep churn low going forward. Let's move to the next slide, please. We provide more than 13 million contract services, 6.5 million of which are mobile telephony services, 4.6 million are pay TV services, and 2.2 million are Internet services. Growth of 1.5% year-over-year is driven mainly by mobile telephony, which increased by nearly 210,000 year-over-year.
We also recorded good sales of mobile and fixed Internet services, up to 159,000. Pay TV remains under some pressure, however, growth in IPTV and OTT is helping offset the declines in traditional pay TV. Let's continue to the next slide, please. I'm excited to report a solid 4.3% year-over-year increase in ARPU per B2C customer, reaching PLN 78.4. This growth was driven by our strong sales in mobile and Internet services as well as execution of our multiplay strategy. We also saw the RGU per customer ratio increase to 2.33% on the back of efficient upselling of products to our customer base as part of our multiplay strategy. If you think back to the slide showing our new multiplay offer, please notice that we have huge potential when it comes to saturating our customers with additional services. Next slide please.
We maintain a high base of prepaid services with 2.38 million RGUs in Q2 2025. Despite intense market competition, ARPU per Prepaid RGU remains high at PLN 17.7 in Q2 2025, recording a small decline of 1.7% YoY from PLN 18 in Q2 2024, but an increase from PLN 17 in Q1 2025. Here I would like to emphasize that our priority is to maintain value in this highly competitive market segment. In spite of the pressure that we are experiencing on the prepaid RGU base, ARPU per RGU remains on a high, relatively stable level, demonstrating our ability to retain high value customers. Can I have the next slide please? In the B2B segment, we successfully maintained the scale of our customer base which amounted to 68,000 despite the highly competitive environment. We have seen a 4% YoY increase in ARPU up to nearly PLN 1,550 per month.
This growth demonstrates our effective management of the B2B portfolio and successful monetization strategies. Next slide please. Let's now move to the performance of our last business Green energy, and next slide please. Diving straight into the operating results this quarter, we have seen remarkable growth in our renewable energy Green energy output increased by 41% year-over-year, reaching 314 GWh in Q2 2025 and 592 GWh in the first half of 2025. This strong performance was driven by the expansion of our wind production capacity last year. We launched two wind farms, Człuchów in February and Przyrów in June, and what is important, we are also making excellent operational progress. One of our major achievements this quarter, as Andrzej has already pointed out, is the near completion of the Drzeżewo wind farm with a capacity of 139 MW.
All 63 turbines have been installed and what is more important, 51 are already being tested. Next slide please. In Green energy segment, we maintain a high stable level of EBITDA, PLN 66 million in Q2 and PLN 123 million in the first half of the year. I'm satisfied with this performance given that we are operating in the environment characterized by low energy prices. Additionally, we have a challenging comparative base in 2024 following last year's strong biomass sales. Please recall the energy from biomass was contracted back in 2023 at higher prices, and we were able to secure favorable terms for the supply biomass in 2024. Looking ahead, with the Drzeżewo wind farm almost completed and scheduled for commercial launch by the end of 2025, we will double our installed wind capacity. This will further strengthen our future EBITDA and drive sustainable growth in the upcoming periods.
Okay, ladies and gentlemen, this was my last slide. Before I pass the floor over to Kasia, let me briefly sum up. We recorded solid operating results across the board in the second quarter of 2025. In the media segment, audience shares were growing thanks to our successful spring schedule to 22.5%, and we significantly outperformed the ad market in the first half of 2025 with the ad revenue increase by 3.7%. In the B2C and B2B services segment, ARPU per customer, both in B2C and in B2B, continues in an upward trend by up 4.3% and 4% respectively. At the same time, we are very happy with the low level of churn, only 7.1% in Q2 2025. Our new simple and flexible multiplay offer is designed to further drive the value of our customers.
In the energy segment, we have almost completed our key strategic projects, and the priority for the upcoming quarters is to focus on monetizing our investments and delivering the promised EBITDA. Thank you. And I hand over to Kasia for the discussion of our financial performance.
Thank you, Maciej. Good afternoon everyone. It's a pleasure to be here with you today to present the financial results for the group for the second quarter of 2025. Despite certain headwinds, we delivered a solid and stable set of results. Let's take a closer look at the key financial indicators. Next slide please. On this slide, we have an overview of our key financials. Revenue increased by 3.9% year-over-year to nearly PLN 3.6 billion, mostly thanks to the contribution of Green energy segment. We posted stable adjusted EBITDA of PLN 824 million, 2.4% less than last year. The key reason behind this slight decline is higher costs, in particular technical costs and marketing expenses related to the launch of our new offer. Net profit settled at PLN 113 million. The year-over-year decrease is driven by one-off effects.
Last year's results included a gain on the sale of IPv4 addresses, while this quarter was impacted by a non-cash impairment of our photovoltaic panel stock. Free cash flow for the last 12 months adjusted for CapEx in Green energy segment reached over PLN 1 billion. This confirms our strong cash generation capacity even in an environment of elevated interest costs. Our key bank covenant net debt to EBITDA increased slightly to 3.66, which is in line with our expectations as we continued to finance investment in Drzeżewo wind farm using our own funds until recently. Can I have the next slide please? Let's move to the breakdown of the factors that shaped our financial results this quarter. Revenue increased by PLN 136 million year-over-year, reaching PLN 3.59 billion. As mentioned before, the highest contribution comes from Green energy segment.
This quarter, we delivered the first tranche of our hydrogen-powered buses to Chełm, which resulted in the recognition of revenue. The contribution of the other segments remains stable year-over-year. Adjusted EBITDA amounted to PLN 824 million, a stable and comparable result to the one posted a year ago in the B2C and B2B services segment. We continue to see good performance supported by higher ARPU and growing retail revenue. The decline in EBITDA in this area is mainly due to higher network costs and temporarily elevated marketing expenses associated with the launch of our new multiplay offer, which Maciej presented in detail. Next slide please. Let's take a look at our cash generation profile over the last 12 months.
Adjusted free cash flow for the last 12 months after interest and excluding CapEx in Green energy segment amounted to over PLN 1 billion at the end of the second quarter. This is a very solid result, especially considering the still high cost of debt. It confirms the group's strong ability to convert EBITDA into cash. Over the past 12 months, interest costs amounted to PLN 1.4 billion. While the recent interest rate cuts in Poland brought some relief, we still operate in one of the most expensive perceived debt environments in Europe. We estimate that interest savings of the second half of the year may reach PLN 30 million-PLN 40 million, but the overall cost of debt service still remains high. We also recorded outflows related to telco frequency reservations.
Over the past 12 months, we paid over PLN 400 million, including the renewal of the 2.6 GHz band and the deposit for the 700 MHz auction. I would like to flag that in Q3 we will recognize about PLN 200 million for the settlement of the newly acquired 700 MHz block, and we expect the 900 MHz renewal in Q4 or at the turn of 2025 and 2026. After that, no further frequency renewals are scheduled until 2029. Let's now take a look at CapEx on the next slide. The TMT space remains invariably CapEx light. CapEx to revenue ratio in this business area was 7% in the second quarter of 2025 after a temporary spike earlier this year. This is fully in line with our expectations, and I anticipate that this ratio will remain within the 7% range for the full year.
Turning Green energy, we are slowly coming to an end of the intensive investment phase. In Q2 alone, we invested PLN 150 million and over PLN 300 million in the first half of the year. The vast majority of this CapEx was allocated to finalizing the Drzeżewo wind farm. As Maciej mentioned, all turbines are now installed, an achievement we are truly proud of, and the site is already generating energy in its testing phase. We expect to launch the project commercially by the fourth quarter. Once the final invoices for Drzeżewo are settled later this year, we will mark the successful completion of our major strategic investment in renewables. This means that the development phase and elevated CapEx in this segment are coming to an end, setting us up for a period of stable returns. Let's move to the next slide.
On my last slide, let's turn to the group's debt. At the end of June 2025, our net debt stood at nearly PLN 12.1 billion. Our net debt to EBITDA ratio came at 3.89 or 3.66 if you exclude project financing. Both figures broadly stable compared to previous quarters. The good news is our average interest cost on loans and bonds dropped to 7.6% thanks to recent interest rate cuts. Still, let me remind you that Poland remains one of the most expensive debt markets in Europe, so the cost of financing remains a headwind for us. In February we took a proactive step and made an early repayment of part of our bank debt. As a result, there are no further repayments scheduled under our loan agreement this year.
As you can see on our debt maturity profile here, scheduled repayments will resume in 2026 with a bullet payment falling in 2028. All our bonds mature in 2030. The structure of our debt by instrument and currency remains unchanged with 68% in bank loans and 32% in bonds and the vast majority denominated in PLN. To sum up, this was a solid quarter. Our financial results were stable and both CapEx and leverage are under control in line with our strategic assumptions. That's all from me. Andrzej, I'll hand it over to you for a quick summary.
Thanks. Kasia and Maciej summing up today's presentation, the second quarter of 2025 was a good for us. We delivered strong financial result with revenue reaching PLN 3.6 billion and adjusted EBITDA at PLN 824 million. As Maciej discussed in detail, we achieved very good operating result in the telecommunications sector. We are happy with our new simple and more flexible offer for customers designed to support our multiplay strategy. We will continue our long term plan focused on building customer value in the media segment. We recorded growing viewership figures and very good performance on the advertising market. It was the result of a successful spring program schedule and smart investment in the attractive and popular sport event. Finishing the installation of all 63 wind turbines at the Drzeżewo wind farm, one of the biggest achievements this quarter.
As Maciej mentioned, this project doubled our wind farm capacity and will support results in Green energy segment going forward. We also received a bank loan of nearly PLN 1 billion for Drzeżewo project. This shows the trust the financial institutions have in our group and our long term strategy. I believe we are very well positioned to continue the consistent execution of our strategy across all our business in the future. Thank you very much for your attention. We are now happy to open the floor for any question you may have.
Okay, we have two questions in the Q&A panel, both from Nora from Erste Group. Hi Nora, thanks for your questions. Nora's first question is what is your view on the planned digital tax? It seems that the idea is similar to the fair share debate between big tech and telecom companies. If implemented, how would it impact the private process that.
Okay, hello, Maciej Stec here. We believe it's worth to regulate digital tax in Poland just to equal chances for Polish companies and have fair competition with global big techs. In terms of impact, the impact is dependent on the formula of digital tax. It's difficult to evaluate without the regulation.
Okay, Nora's second question is could you provide an outlook for equipment sales in the second half of 2025.
As far as the equipment service is concerned, please remember that this is what happens now on the market. This is the current market trend. Basically, people are buying more expensive, expensive devices, but they're using them for longer periods of time, which basically means that the market is a bit saturated in my opinion. Actually, I think we're the best sellers among the four large telecoms in the country. Looking at our results and looking at the results of our competitors, I think the sales will improve a bit, but I wouldn't expect very sharp increases or very big sales of equipment. This is not something that's going to happen. I would say more around the fourth quarter.
Thank you. One more question from Nora. When is the company expected to reach the peak of its net debt to EBITDA?
Probably around first quarter 2025.
Okay, thanks Kasia. I don't have any more questions in the Q&A panel. Thank you all very much for participating in today's conference. Andrzej, I hand over to you.
Thank you very much for our management team and Kasia and Maciej prepare and explain the situation in the second quarter 2005. I believe that we have possibility to meet at our conference our result for Q3 in autumn this year and have a nice evening if I say.
Thank you. Bye
[crosstalk] Bye.