CELLNEX TELECOM SA (CLNX) Q2 2026 Earnings Call Transcript

Hello, good afternoon. Welcome everyone to SELNEXT Telecom's first half 26 results presentation. I'm Maria Carapato, and it's a pleasure to be with you today again. Before we begin, as usual, I'd like to remind you that this presentation contains forward-looking statements. Please refer to the disclaimer included in the appendix in the slide deck. So, Marco will open the presentation with the main highlights. Raimon will take you through the financial performance, and then Marco and Simone Battiferi, our COO, will close with some considerations on other industrial and strategic topics that are often raised by the market. So with that, let me hand you over to Marco.

Thank you. Thank you, Maria. Good afternoon, everyone. So before going into the numbers, let me frame the first half in one sentence. Salnex is delivering exactly on the model with this curve to the market, predictable organic growth, expanding margins, accelerating pre-cash flow and tangible shareholder remuneration. Let me highlight the four key messages of the first half. First is that operational momentum remains strong. Organic points of presence growth reached to plus 4.9% year in year, confirming sustained demand from customers across the entire portfolio. This translated into solid financial performance. Revenues grew by 5%, adjusted EBITDA by 6.4%, EBITDA after leases by 7.7%, recurring level free cash flow by 11%, and recurring level free cash flow per share by 18.1%. From a margin perspective, both EBITDA and EBITDA after leases margins increased by nearly 200 basis points, reflecting continuing operational efficiencies and land management actions. The second is that pre-cash flow has entered a new phase, from 19 million in the first half of 2025 to approximately 301 million in the first half of the year. This allows us to reiterate our guidance. Third, we continue to deepen our customer relationship. Sunrise in Switzerland, Vodafone Spain, Telephonic in Spain are all examples of Cellnet being selected as a trusted infrastructure partner for network expansion, contract renewal and network resilience. And fourth, shareholder remuneration, which is delivered as committed. The 500 million dividend has been paid, the 300 million share buyback has been completed. and 11.3 million shares are expected to be cancelled during the second part of the year, improving the per-share metrics. I'm pleased to share that today our board of directors has approved an additional share buyback program of €200 million to be completed until the end of 2026. So overall, the message is clear. Our industrial position is translating into predictable growth, stronger cash, and direct shareholder value creation, as promised. With the announcement we are making today of an additional $200 million in share buybacks, the total shareholder remuneration in 2026 will reach €1 billion, combining the $500 million of dividends already paid, the $300 million of SDB executed in the first half of the year, and the additional $200 million of share buybacks just announced. Between 2025 and 2026, we will have returned a total of 2 billion to shareholders between dividend share buybacks, representing 11% of our current market capitalization. There's no doubt that the share buyback we're announcing is highly accretive capital allocation decision, driving significant growth in per share returns and long-term value creation for our shareholders. With that, let me hand over to Raymond, who will take you through the financial and operational performance in more detail. Raymond, the floor is yours.

Thank you, Marco. Good afternoon, everyone. Let me start with the slide 7, which summarizes the financial performance of the first health on a proforma organic basis. The key message is simple, Thelnex continues to convert predictable top-line growth into higher cash revenue per share. Revenue growth was plus 5%, adjusted EBITDA grew by 6.4% and EBITDA after leases grew by 7.7%. At the cash flow level, recurrent labor free cash flow increased by 11% while the metric per share grew by 18.1%, reflecting both operational execution and disciplined capital allocation. On the next slide, we show the bridge from reporters' revenues to organic revenue growth. Starting from the first half 25 revenue base, perimeter adjustments bring us to comparable reforma base. This results in 2 billion of organic revenues in the first half 26, representing 5% growth year-on-year, supported by price escalators, and continued demand from customers. Moving forward, you can see points of prices continue to show healthy commercial momentum. In absolute terms, second quarter showed strong performance, with more than 2,000 new net pots and positive contributions across our main regions. In the first half, gross pop growth reached 5.7%, while net pop growth was 4.9%. Importantly, this growth comes despite consolidation trends in some markets. Consolidation does not eliminate investment. Healthier operators continue to deploy more capacity, coverage and network quality. This is one of the most important messages from the first half. The need for densification remains strong, and CENMEX continues to capture that demand through both collocation and build-to-soup programs. The operational momentum translates directly into tower revenues, as you can see on the current slide. On a pro forma basis, excluding Kireland, tower revenues grew organically by 5.2%. Tower revenues remain the core growth engine of the group, driven by contractor price escalators, co-location and build-to-set activity. This is the essence of our business model – growing coverage, improving densification and leveraging our existing budget base. Moving to slide 11, our other business lines also continue to provide growth upside. Fiber connectivity and housing services grew organically by 7.8%, adjusted for the French data center disposal and supported by the continued rollout of the Next Loop project in France. Thus, small sales and run-as-a-service grew by 4.5% organically, supported by high demand in high-traffic locations, venues, and complex indoor environments. Finary broadcasting remained stable, growing by 0.5% organically, continuing to provide a steady and predictable revenue stream. We are providing you practical examples of how our industrial strategy translates into real commercial activity. First in Switzerland, Sunrise and Celnex have extended their long-term strategic partnership through an expanded build-to-suit program covering 300 additional sites. This supports the next phase of Switzerland mobile network evolution and reinforces Celnex roles as a scalable infrastructure provider. Second, in Spain, our legacy Vodafone framework agreement has been renewed for 10 years, covering approximately 2,000 existing POPs. Importantly, the renewal has been signed on unchanged technical and financial terms, and Cellnex will also host a limited number of additional POPs on existing infrastructure. Third, Telefonica and Cellnex have extended the backup battery partnership to a total of 3,800 sites, reinforcing network resilience and energy security after the recent blackouts. This reinforces our role as a trusted infrastructure partner and shows how resilience, energy security and network availability are becoming increasingly relevant customer priorities. Beyond our traditional tower business, we are also expanding our presence in DAS and neutral host solutions. For example, Telnet is deploying a multi-operator DAS at the new Valencia football stadium in Spain and expanding neutral host mobile connectivity along the Brighton mainline in the UK. These examples show how Thelmex is actively shaping infrastructure solutions for our customers' needs and their ongoing network investments. Turning to slide 13, operational efficiency continues to be a key lever of value creation for Thelmex. On an appropriate basis, cost per tower decreased by 3.3% year-on-year, maintaining a high level of operational quality across the portfolio. As a result, we continue to expand margins, with a bit-dull margin reaching 84.6% and a bit-dull margin increasing to 61.8%, the highest level achieved in recent years. This reflects the operating leverage embedded in our business model, the benefits from our efficiency initiatives and the continued progress of our land management program. In short, we are not only growing revenues and cash flow, we are doing so with greater industrial efficiency, supporting sustainable margin expansion and value creation for shareholders. Next slide shows the cash flow bridge from the first half 26. Starting from a bit after leases, we reach a current lever free cash flow of 908 million euros and free cash flow after expansion and build-to-suit CAPEX reaches approximately 301 million euros. The three key drivers behind the result are the solid operating performance, an efficient capital and tax structure supported by optimized cost of debt, and lower build-to-suit CAPEX intensity as the build-to-suit cycle normalizes. On slide 15 shows the free cash flow inflection point where it is clearly visible. Proforma organic recurrent lever free cash flow increased by 11% and recurrent lever free cash flow per share increased by 18.1%. The share buyback program is enhancing pre-share value creation while the business itself continues to generate stronger underlying cash flows. At the same time, free cash flow increased from approximately 19 million to 301 million in the first half of 26, an increase of approximately 282 million year on year. Free cash flow generation is no longer a future promise, it is happening now and it is accelerating. Our liquidity and funding position remain very strong. At the end of the first half of 26, liquidity stood at approximately 5.3 billion, including circa 2 billion of cash and 3.3 billion of undrawn committed credit lines. As such, our 2026 to 2028 maturities are largely funded, giving us flexibility to navigate market windows. With that, let me hand back to Marco to discuss some broader industry dynamics and why they reinforce our confidence in the long-term investment case. Thank you, thank you, Raymond.

I would like now to step back from the financial results for a moment and discuss the broader industry backdrop. This matters because our equity story is also about why demand for our infrastructure will remain strong for many years. The next slide addresses some of the topics investors raise most often. Traffic growth, direct-to-device satellite, Europe's competitiveness and digital sovereignty, and M&O consolidation in France. For us, the conclusion across all four of the topics is consistent. Europe needs more infrastructure investment, and CELMEC is one of the best positioned platforms to capture this investment cycle. The topic is very technical. So, Michael Leves, Simone Battiferi, our Chief Operating Officer, He's also joining us today, and he will walk you through trends in mobile data growth and explain some fundamental concepts on how to divide satellite connectivity. So, Simone, make it simple, please, and drive us through the mystery of the technical stuff.

Thank you, Marco, and good afternoon, everyone. Well, looking at slide 18, the key message is that we see a clear positive inflection point in mobile data growth. And in fact, it is accelerating again. Global mobile networks data traffic increased by 22% between first quarter 25 and first quarter 26, confirming that demand for mobile capacity continued to expand at a sustained pace. Importantly and curiously, this acceleration is not yet AI-driven. Latest industry traffic reports make the point clear. AI applications are still a very small portion of total traffic, let's say low single digit today. And there has not yet been a visible AI-led inflection in mobile uplink trend. The main growth driver remains video streaming, the expansion of FWA, and the increasing penetration of 5G devices. And this matters because Europe is still in the middle of the 5G adoption cycle. 5G-enabled devices represent only half of the mobile connection in Western Europe today, and adoption is expected to move close to 95% by the end of this decade. Well, the implication is clear. 5G subscribers already consume around three times more than a 4G user on average. And 5G traffic per user is expected to further double in the next few years. So the maths are simple. As the customer base continues to migrate to 5G in the coming years, overall traffic will increase significantly. Underlying consumer behavior is therefore still pointing to an old data growth above 20%, and more network capacity will be required just only to avoid congestion and preserve service quality. At the same time, the network of traffic is changing, too. The network is not only being asked to carry more data, but to carry more demanding data. AI-enabled application, real-time collaboration, industrial automation, connected device, future wearables, would require networks that are more responsive, more reliable, and more available indoor. They will also increase the relevance of uplink capacity, making networks demand progressively more symmetrical than in the past. So mobile networks are entering a new phase. The question is shifting from do I have coverage to do I have guaranteed quality? And quality means higher capacity, stronger indoor performance, more predictable service levels, better reliability, higher uplink capacity and lower latency. The physics of the networks at the end are simple. Carrying more data requires more capacity. More capacity generally means using more spectrum and adding higher frequency. Higher frequencies deliver more bandwidth, but at the same time, they propagate over shorter distances, requiring a denser grid of cells. Furthermore, they penetrate buildings less effectively, which makes navigating indoor coverage increasingly important. The only way to solve that equation is to bring the network physically closer to the user. That means densification, particularly in urban areas, that translate in more indoor systems and a larger and more capable infrastructure footprint. So if we go to the slide 19, let me address another topic we are increasingly asked about by our investors, that is the direct device satellite connectivity. Let me start by saying clearly that satellite is a powerful and valuable technology. D2D can play an important role in the broader connectivity ecosystem, especially in remote or underserviced areas where terrestrial coverage is technically difficult or impossible, or even economically inefficient to deploy. Both satellite and terrestrial networks are designed to solve very different problems. Terrestrial networks are optimized for capacity, latency, reliability, and indoor performance. Satellite networks are optimized for extending coverage over very large areas. The reason is not only technological, it is physical. A terrestrial network can reuse spectrum every few hundred meters, saving a very large number of users simultaneously with high capacity. A satellite beam, on the opposite, covers a much larger area, shares capacity across many more users, and has far less ability to reuse spectrums effectively. This is why the average downlink capacity of a satellite D2D connection is today less than 0.1% of a terrestrial mobile network in urban areas and less than 5% in remote location. Said in practical terms, even when constellations are fully deployed, the service will remain much closer to a 2G-like experience, valuable for essential connectivity, messaging, and potentially basic voice, but not comparable at all to mobile broadband. Distance is another fundamental constraint. A low-earth orbit satellite is typical hundreds of kilometers away from a handheld device and sends a vertical signal that in urban and suburban environments must pass through multiple physical obstacles before reaching the user. By contrast, a mobile antenna on a tower is usually a few hundred meters to a few kilometers away and projects a horizontal signal designed to serve users with much higher capacity and better penetration into buildings. This is particularly important because most mobile traffic is generated indoors, we are talking about two-thirds, where satellite signals face a structural limitation. These differences define the role that the right-to-device can play, an excellent complement for coverage, but not at all a substitute for terrestrial capacity. So, if you go to summarize the key takeaways in slide 20, first, satellite D2D is fundamentally a coverage solution. Its strongest use case is a standard basic connectivity to remote or hard-to-reach locations. A clear evidence of these days is the emergency connectivity provided by satellites during the wildfires raging across Spain and France. Second, the capacity gap versus the rest of the network is structural, eroded by physics itself. Satellites are much farther away, beams cover much larger area, spectrum is reused far less efficiently, and signals face more difficult propagation and penetration conditions. So, even if there is a major future technology breakthrough in direct-to-device, the satellite capacity will remain multiple times lower than mobile terrestrial networks. Third, indoor performance remains a fundamental limitation, particularly because most mobile traffic originates indoor. Fourth, handset battery life and antenna constraints create additional challenges for upper-link capacity and user experience. So, let me say that the conclusion is clear. Satellite-directed device does not replace the need for micro-towers, network densification, or dedicated indoor solutions. As mobile traffic growth and quality requirements increase, especially in those areas, investment in the rest of mobile infrastructure will remain essential. Well, back to you, Marco.

Thank you, Simone, and thank you for this jump into the technology. I think you made it simple and clear, so really thank you for your effort. So, Europe faces a clear challenge in terms of digital competitiveness. Average mobile download speed in Europe is around 86 megabit per second, materially below North America, China, Korea, Japan. This gap is increasingly recognized as a strategic issue for competitiveness, resilience, and security of our continent. GSMA estimates total mobile investment needs in Europe at around €475 billion over the next decade. €270 billion just to maintain the ordinary technology cycle, which explicitly includes densification to improve quality coverage and performance, plus €200 billion more if Europe wants to regain connectivity leadership. I would like to call your attention to yesterday's announcement by Agicom of the Spectrum Renewal public consultation process in Italy and the network performance metric expected from the MNO and please consider that similar regulatory processes are advancing in Portugal and France. The proposed obligations include investment in transport routes, 5G standalone coverage, network resilience, and AI-ready networks, all areas that are infrastructure-intensive. And we haven't even begun to talk about 6G, which is expected to kick off in 2031 or 2032. This is the core message for investors. Europe cannot close the gap with spectrum alone or software alone. It needs physical infrastructure, more densification, better resilience, higher quality network. And Solnex is uniquely positioned to provide efficient, shared, and sustainable platform to deploy those networks. Let me finish with France, which is one of the topics that animate quite the discussion around Solnex. Our view remains constructive. We believe consolidation has the potential to create stronger operators with greater capacity to invest in network quality and infrastructure. As shown on the slide, our direct exposure remains manageable, while the process itself is expected to be lengthy, involving regulatory review, approvals, and a very long transition period. And timing is important. Operators are unlikely to make long-term decisions based solely on the network requirements that we see today. By the time the consolidation process is fully completed, traffic volumes, file G penetration, digital user patterns will be significantly different from where they are today, as we already discussed with Simone. In that environment, operators will need better networks, not smaller networks. Over the past decade, France has been adding around 5,000 tops per year, reflecting the industry's ongoing need to invest in network capacity and quality. And despite that level of investment, France still ranks only 21st in Europe and 34th globally in mobile network experience, highlighting the significant room for improvement that still exists. that is why we believe it is important to look beyond the analysis of the respective networks today and focus on the network that operation operators will need five years from now stronger operators with healthier balance sheet with a better position to continue investing densifying and improving network performance our objective is therefore to remain constructive and proactive working alongside our customers to support that next phase of investment. So if we step back from all these industry trends, the message is remarkably clear. Mobile traffic continues to grow. Europe needs to improve its digital competitiveness. Satellite enhances connectivity but does not replace terrestrial capacity. and market consolidation can create stronger operators with greater ability to invest. When we look across traffic growth, digitalization, AI adoption, network quality requirements and market consolidation, we arrive at the same conclusion. Europe will need more network capacity, more densification and continued infrastructure investment. In short, the future requires better networks and better networks require more infrastructure. Maria, it has been a little bit longer than usual, please I would like to excuse with our investors and analysts, I am back to you.

Thank you Marco, Raimon and Simone for very clear explanations, so we are now open to take calls. The first question comes from Andre Kavasek from UBS.

Hi, can you hear me now?

Yes, I can.

Good. Thank you for the presentation and all the very helpful additional color. I have two questions, please. Both topics that were touched upon. So the first one was on the French deal, just from a regulatory perspective. We now know that this will be analyzed locally, and I was wondering whether, from your perspective, there might be any differences to the kind of remedies that you would expect around, say, investment obligations. And obviously, the reason I'm asking is that while we have some commentary from the French authorities around the need to improve networks, it is perhaps not as explicit as a policy as it is from the European Commission with the DRAGSA report. So, any implications of the local jurisdiction versus EC in France would be very helpful. And then the second question, Marco, you touched upon this, and Simona, I guess, as well, but the AGCOM proposal yesterday where the network obligations are, I guess, very conducive for someone like yourself. So I guess there are two dimensions I would appreciate if you could give us color on. uh one are the coverage obligations and looking at the uh targets um that you know they set out or IGCOM sets out I was wondering what kind of increase in the number of sites and the physical infrastructure that you were talking about do you reckon is needed to comply with these numbers I believe Inuit suggests something like uh 20 to 25 percent to reach some kind of you know good coverage in Italy or up to 12,000 sites. So, is this roughly your estimate as well that Italy should see kind of an increase in the number of towers similar to that? And secondly, and perhaps more technically, the regulators says there will be a minimum download speed requirement of 150 megabits per second. You make the point that, you know, data traffic continues to grow. and Okla reported median speeds in Italy at 1Q, exactly half of this proposed floor. So on that one, I was wondering how these higher speed requirements could translate into more business for you. And again, any estimate of like hop increases to get there would be very helpful.

Yeah, sure. Sure. So on the regulatory France versus Europe, I think that it has been a good decision because I expected that the French regulator will be close to the market, closer to the market, closer to the interest of the French. at the end when you design a new when you make a new market design you're asking to a country to renounce to something which is uh the competition on the market so you're making something that is very important and so the citizens the nation the community needs to receive something in exchange so it's good that the regulator is french but i'm 100 sure that there will be a super strong bonding and connection between the French regulator and the EU authorities so ultimately there will be more or less it will be more or less the same with a let me say an easier accessibility of all the other parties that are involved vis-à-vis the regulating authority. So remedies I expect to be the usual ones, the ones that we expect. It's not what, it's the size probably that will be decided by the authority. This brings me to your second question. Your second question is, well, 12,000 new sites is meet high in my expectation I would have said 10 to 15 so 12 you are in the in the mid-high part of Italy of the Italian of the Italian need how much coverage or much densification uh i think that uh the coverage has a permitting process way easier and but it has to be thought uh i would say with the with the business model that has to be more convenient for the operator i would strongly suggest to have more densification more sorry more more sharing more collocation so this is this is what is what is needed now your technical your technical part on on the speed you know that when you move from from the current 5g to the 5g standalone you're not touching just the transmission because the transmission at the end is limited by the core network. So now, a good part of the problems in speed, latency, and responsiveness of the network depends also on the fact that the core networks of the operators are not designed for the 5G standalone. loan this is something that the most of the of the mobile operator make very clear every time my old friend Pietro Labriola makes clear every time he has to invest about on the core network core network are expensive yes core networks are relatively expensive not dramatically expensive a few hundred million euros but the problem is that it's a few hundred million euros each so So you cannot, it's very difficult to share a core network. So if you can be efficient in towers and in transmission, in transport is less obvious. So if you put in your model something on core network, you don't make a mistake. Hope I answered Andre.

Interesting, thank you.

Okay, so the next question comes from Andrew Lee at Goldman Sachs.

Good evening, everyone. I had two questions. First of all, I just want to say thanks for the satellite technology articulation around the debate. I see a lot of misunderstanding or lack of understanding there, and I think articulating is really helpful, especially given that I think operators have really struggled to do that, which has not helped the conversation. But moving on, I have two questions. Firstly, just wanted to ask, have you seen any signs of post-consolidation densification acceleration by operators in Spain and the UK? Obviously, it's a key area of confidence building in the consolidation debate. Do you have any visibility on when this will begin? It doesn't look like it started yet. And then the second question, there was a press article a week ago suggesting that SELNECT had been examining strategic options including buyouts, large-scale mergers. I just wanted to ask you, is there any truth to this? I'm not expecting you to comment on specific examples, but do you think there is a material strategic option available? And in the context of this, just wonder if you could comment on why you chose to buy back shares rather than pay down debt today.

Okay, so definitely your two questions are three. Thank you very much. Well, Andrew, let's start from consolidation and Spain and the U.K. in Spain we start to see something happening Mass Orange is well advanced in their in their integration phase you saw that last year we had a big bulk of their consolidation in the second part of this year we will have a second a second step that we agreed with them uh but as before uh now uh they are working on two on two uh areas they are working on uh very very seriously on uh on transportation corridors transportation corridors mass orange is uh uh is making this as a strategic investment area uh and they are starting using a small cell way more than what was done in the past especially in problematic dense urban areas so this is good because we are working very strictly with them we are it's not particularly known but we are the largest operator in europe in dozen small cells so we have a big know-how and in particular our spanish chapter is possibly the most advanced that we have in in the group uk uk unfortunately uh it's taking longer than what we expected so we don't change uh our uh our uh our view so the fact that uh something uh will uh will happen i'm i'm totally sure that something will happen that that there would be a need of some thousands of sites that have to be built, both urban and non-urban. So we're talking about several thousands of sites that we, in our network simulations, that we see. For the time being, different from other markets, the carrier-neutral model for, again, transport lines, so the Brighton line is something that possibly some of you use every day while the coverage is provided by us. So this is something that, again, we see, but unfortunately not in the order of magnitude as we expect. Is it something I do expect for 2026? Honestly, doubtful. Is it something that I expect for 2027? Yes, definitely. On strategic option, I read what my lawyer wrote me. So, I stay to my, he's here in the room looking at me. So, as a leading European player, it's natural that the company may attract investor interest at current valuation levels however we are not familiar with the conversation referred to the article so a part of being very well very well written now you get the sense yes it's convenient this price for subnet so the reason why we're making the share buyback um so your third question is uh uh why share buyback and not that repayment well uh you know our our cash generation is doing well uh and we're convinced that we can do well for the entire year and and this means that we as i told we entered in a different phase in which cash is going to be very evident. We're not changing our overall targets for capital structure, but today the share price does not reflect our vision on the intrinsic value of the company. Headwinds are, in my view, overestimated in our price, and tailwinds, as Simona was saying, are not included. So the board is convinced that allocating 200 millions to share buyback at this moment generates value to the shareholders, not only in the short term, but most importantly in the long term. And this is why the moment is correct for doing it now.

Thank you.

So the next question comes from Akhil Zatani at JPMorgan.

Good afternoon. Markham, if I can start with the shareholder return comments you just made and maybe just ask for a bit more color. I understand, as you mentioned, it's a reaction to seeing value. But I guess I'd love to understand the general framework you're using in terms of thinking about what you want to do. Because over the last couple of years, we've had a few add-on buyback decisions that you've taken as you felt it was appropriate. If we try and step back and think about the journey going forward, can you sort of help us frame how you're likely to approach your decision on buybacks? is it going to be opportunistic based on share price is it going to be based on more framework driven decision making so just if you could just elaborate generally how you're thinking about the philosophy of what you're likely to do that would be super helpful and then the second one was the topic you've mentioned around tell-ins you talked a lot about various opportunities one opportunity you didn't mention which your US peers talk about a lot is edge computing And I'd love to understand what your general thoughts are. I appreciate it's a long-term topic, but the U.S. tower codes are already starting to make investments in this space. Do you see it a little bit like small sales where the U.S. pushed hard and ultimately didn't amount to a huge opportunity? And I guess you didn't pursue that at the time. Or is it different this time? Is this something that you similarly also see as being an interesting opportunity for towers midterm?

Cool. well on on the philosophy uh you remember we made very clear that we have a dividend policy that we're not changing so our dividend policy is uh 500 million grew at 7.5 percent blah blah blah you you remember we are delivering we paid the 500 million and you can that's next year we will do 500 million plus 7.5 percent second we said the minimum we're going to do is 800 million and the Delta between dividends in 800 million is depending on the value creation the value creation is in this moment clearly coming from from share buyback it's I wouldn't describe these as opportunistic I would describe it as a logic or if you want fundamental analysis so there is a big difference between yesterday today and tomorrow yesterday we made share buyback because we had some extraordinary disposal and and which make available some extraordinary money that we used today we are making a decision that is based on our capacity to generate cash flow which going forward will remain generous and abundant and we said that we will allocate these these extra capacity in the way that will generate more value to our shoulders as of today the board made the decision that share my back cause was the way so i would say that this is the philosophy so let's uh let's consider what is uh uh the the value the value creation where the value creation comes from let's see what are the resources available structure available and let's do it so on your second question it's very interesting because Simone and I we have been discussing this topic not less than five times in the last two weeks if I look what has been done today by look For example, NVIDIA and Nokia, it's not really an edge computing on a tower. It's an AI integrated equipment with a sort of self-configure or AI-driven configuration of the equipment.

So it's not really edge computing on the tower.

But I'm convinced that the more we enter into distributed AI, the more a system that brings everything to the center is tremendously inefficient in terms of traffic load. So every time you have to transport a lot of data that most of the time are useless. So imagine that you need some AI for self-driving vehicles. Do you really need to have data going to U.S. and coming back, or it's better to have some maps on a tower that is 300 meters from you? I think that this is something that can happen, but it's really at the moment a bit unclear how it will happen. and Simone is working very actively Simone has been in the IT and in the semiconductors for a good part of his career so we're activating our contact just stage one I think is better understanding I see an opportunity but as you said it's a midterm opportunity more than a short term one I hope I answered. Yes that's great Thank you. Thank you, Akhil. See you soon.

Okay, so the next question comes from Rohit Modi at Citibank.

Hi, thank you for taking my questions.

I have two pieces as well. One is the follow-up on this question on the article, and I understand you can only talk to some extent on it, but in general, your discussions with private players, how do you see, what are the key constraints that you see in terms of valuation of towers I mean apart from rates is what is going on in Italy and partly in Spain a kind of rippling effect in the way private players see now tower covaluations with all the renewal risk and yes and any color around that and secondly you you said you mentioned about the cash flow generation was pretty strong in the 1-inch again looking at the 1-inch

number and the phasing you had in last two years on your free cash flow and currently cash flow you are heading kind of towards the upper end of your guidance is that the kind of ways we should look for the second half and full year and should that be the base for the next year in terms of when you look at you know the guidance range thank you good I'm looking my lawyer for for I can't add very much because what I can tell you we traded 14 times we traded 14 times it's uh 14 times we trade that more than 10 percent uh recurring letter free cash flow per share yield i think that that numbers that speak for themselves we are large we are uh we are diversified so what i can tell you i i honestly i i have very little to add uh cash raymond Hi, Rohit.

Look, during the year 26, as you have seen, we have massively increased the free cash flow. There is a changing point to a situation where we're going to be this year between the 600 and 700 that we gave as a guidance that will grow next year to a level that is from 975 to 1075. We are reiterating our guidance and we are not expecting any change on that. This year we are on halfway of the year, halfway in the pre-cash flow. Second part of the year we will see as the first half some build-to-suit is still coming. We will still have some of the growth coming from the collocation and all of it will help us achieve the guidance that we have given to the market. We are not giving any short-term guidance or anything similar because we are expecting to be, as promised, between the 600 and the 700 million.

Got it. Thank you.

Okay, so now moving to the next question. We have Roshan Ranjit at Deutsche Bank.

Great. Evening everyone. Thank you for the questions. I've got two operational ones, actually. Firstly, turning to Spain and the renewal of the Frameworth Agreement with Red French Spain. So I think the first part, very, very clear, renewal of existing POPs under the same conditions. But you've also added additional new POPs. So I just wanted to get a sense of the kind of, I guess, level of discipline in that market. Clearly, one operator has been very strong about wanting to move. So is there scope for those additional POPs to go higher that you could offer? I know, Marco, you've been very clear on the kind of degree of overlap in that market. Is that still a big barrier for any kind of operator to switch, please? And the second question, again, on the operational side in France, we've seen a pickup in the BTS deployment. It seems quite evenly split between the BWIG and the SFR build suits. how should we think about that going forward in the context of the kind of ongoing regulatory review because I know previously there has been talk about synergies from potentially combining go to suits or is it kind of business as usual in terms of the deployment until we get a bit of news flow you know through the air or perhaps next year thank you thank you so Spain our goal number one was we had a 2,000 pops which were secondary pops that were expiring we wanted to

renew and our Spanish team has been able to renew at the same terms and condition we had before so tick the box that we made another renewal without suffering which is one of the of the many headwinds that time to time were to face so we continue to renew ordinary course of business the second part of your question we have been asked making an analysis if some of our towers could be eligible for hosting antennas from Vodafone we made a technical analysis so some towers the answer was yes, some towers the answer was no and we applied the usual price list so we did not make any special favor and we have been asked to host some hundred antenna which is good. Now, to your point, is it something, is new deployment or, sorry, I'm not the CTO of Vodafone and so uh is it densification is it coverage is it to say the truth i don't know uh possibly densification uh second france did something change in our build-to-suit program uh due to the sfr split of course yes uh it's obvious uh what we are uh what we are uh doing is there are areas that are not under discussion all the non-dense urban zone is coverage and coverage is coverage if there is not enough network we build a network and it's good by the way we continue to insist to the concept of collocation to suit so every time we build a tower we strongly insist to have more than one operator in order to make those network more efficient first of all for them in order to avoid that those networks becomes way too expensive and in the in the in the urban areas of course we are working more prudently we have to avoid it to generate new overlaps even though the the consolidation takes time so there is a there is some business as usual but business as usual with good common sense so let's avoid it to create today the problem of tomorrow I think that in this everybody is well aware the attitude is constructed and we have several years of experience with all of them so we're working well with them that's great thank you thank you Okay, now moving on.

The next question comes from Ulthik Rath from Bernstein.

Yeah, thank you very much. I have two questions, please. The first one is on BTS. Marco, on the recent interview that sort of popped up on YouTube, you talked about legacy BTS terms that need to be adapted for future BTS. Can you comment on how these terms are changing, such as the one that you're announcing now for Switzerland? If it's not the numbers, it's sort of, you know, which elements of the BTS are you touching. My second question is, could you provide an update on the land management program in terms of how far you are and how it's going?

Okay, I answer the first, and I leave the land to Raimund. Possibly the Swiss case is not the best example of a innovative contract. The Swiss case is a bit more of the same. We had a program with our client. We expanded the program. Please keep in mind that building new sites in Switzerland is quite complex because of permitting. it is one of the country with the most severe legislation both on permitting and in the radio in in radio electromagnetic emission limits so it is it is a bit more of the same even though please remember that the the Swiss market is is really a very a very solid one because of the structure with structure so the when I say that going forward we should imagine something different is yesterday the build to suit to wear a sort of a forward execution of an M&A so you were taking the M&A I buy a pass of the portfolio which is an existing portfolio and then I buy a possible photo which is a forward delivery of the same conditions which means that the same conditions for the conditions of a world that does not exist and in order rates are different conditions are different etc so what they assume I assume first that towers should be built by design multi-tenant every time we go somewhere we have to make the question day one how can we make it multi-tenant and these can allow to have two semi-anchor fees so you should imagine something between a full anchor fee and a full second fee second tenant fee which will be convenient for both at the end and it will be convenient because you build day one the tower optimized for multiple tenants so with the structural exercise the structural engineering that is okay with the energy which is there so you have not to go there twice so you save a lot of money then possibly if i make something like this by design i can buy the land by design and if i buy the land by design possibly we can share part of the benefit because this is something that's all in all uh i think that The European case suffered a bit of over-financial engineering, and today we are telecom engineers. And telecom engineers work a little bit different, work more on the cost and the value that we are transferring to our clients. So, proximity to the clients, making the network not too expensive, sharing the synergies, sharing the same issue that we make. And we are making incredible work on AI applications for infrastructure. Of course, we are specialized infrastructure, so we invest.

That's it, so yeah on the land all rich basically as you know we launched in the year 24 the concept of FEDLAND it was an entity to be able to accelerate the acquisition of land but as well the cash advances on mainly rooftops in order to achieve an improvement of their efficiencies This year our cost per tower has been improving month after month. The efficiencies that we have achieved so far this year offset and are a bit higher even than the increase on CPI, that is our target always trying to offset the increase on CPI. Also you will have seen in the numbers in the free cash flow that the efficiency capex and the land acquisition capex is a bit below last year, it remains more or less in line and we're expecting like last year a bit of acceleration in the second half of the year. We have already acquired more than 700 sites this year, more than 1,000 sites where we have non-cash advances and we continue with the same rhythm and the returns that we're getting are very much in line with what we had last year. The only thing is that as Marco has mentioned before we are being a bit more careful on some places For example, in France today, we are looking at the consolidation potential effects to make sure that we buy the site that makes sense buying, and we avoid buying sites that can generate a problem for tomorrow. But so far, the program continues working extremely well, and we are not expecting any change rather than accelerating on the second half.

That's right. Thank you very much.

Okay, now over to James Ratson from New Street Research.

Yes, thank you very much indeed. Good evening. So I have two questions, please. The first one, Marcos, we've kind of talked a lot through the presentation about kind of technological drivers helping to support your growth, whether it's kind of 6G or FWA, more transport connectivity, just kind of growing usage. And then, obviously, today you've announced the deal with Sunrise and we have the ATCOM announcement yesterday. and other drivers as well. I mean, when I take that all together, how do you then actually think about what your organic tenancy growth will do, you know, over the next, let's say, kind of three, five, eight years? You're currently growing your organic pots at around 5% year on year. I mean, do you think that rate of growth is sustainable at that level for the foreseeable future? Just look to get your thoughts on putting all these drivers together, what it means for overall pop growth. And then the second question I had was just would love it if you could just kind of dig in a bit further on the answer you gave earlier around Spain to make sure I understand this correct. It sounds like on the new tenancies you've signed with Vodafone, were they approaching you to ask you for a much bigger kind of potential portfolio of additions, but your pricing was suitably high that you only managed to agree on a few hundred? I would love you to expand on that answer you gave a bit earlier to kind of understand the process by which those few hundred new sites were agreed on in the Vodafone Spain contract.

Now, on the technological drivers, you have to split it in two. One is increased co-location. increased collocation if you want to really to understand increased collocation first of all you have to split between towers and rooftops and when you split between towers and rooftop you have to split once again between urban and unurban on a tower the tendency can be way more than two because you can go with two tenants plus an FWA plus some other dishes you can you can put a lot of things when you are in a dense urban areas and you have a rooftop going above one he's it really depends where you are if you are close to the center of Paris is possible that the mayor does not give you the authorization. So all in all, our portfolio, if you take mature countries, which are the countries in which we've been able to grow since more times, Spain, Italy, etc., the overall blend goes in the direction of slightly above two. If you take Inuit is above two, if you take mature tower operator, they tend to go above two which means that on tower will you are well above two and then on rooftop where you are in 1.5 or 1.6 etc what makes the difference is the price mix because today we have the price mix which in which there is a big difference between an anchor a second and a run sharing so going forward the densification doesn't bring the same effect of new network creation the economic impact is the economic impact of the second or a run sharing and then you have the the future need of further network creation that there will be there will be further network creation as i was saying uh one one second ago the business model possibly will be different but there will be uh still to build more towers and i would say that possibly another exercise will be proactively dismantle some towers this is going to be an exercise that i see coming. So, if I can proactively make some network rationalization, this can drive efficiency that can be shared between the tower operator and the MNO, which once again, reduce the appetite for making something bold because we give them, we feed them with the savings that we can make for them is it a 5% growth sustainable eight years from now only God knows I would say that a 5% pop growth possibly is a eight years from now possibly is a bit generous but it will very much depend on how much network creation we will have because I don't think it's going to be zero so this is the big mistake is that people believes that we have already too many towers and and this is wrong Spain mm-hmm let me let me try to put a little bit of order did we make special prices for the or eventually higher prices for new location absolutely not so we have a price a price scheme that is is the same that we apply for second tenant by the way we applied to Vodafone the same as we apply to others so we don't privilege and we don't and we don't penalize of course what makes the difference is that if in order to host a new antenna I have to rebuild the tower because I have to make so much capex to strengthen the tower that is an absurd it's a little bit difficult so the first exercise is if I can materially host you in the place where you are interested because by the way you're not interested in every tower I have in my portfolio so we have been asked for a certain list of towers and we answered which of those distal towers could be eligible easy not easy or dramatic okay and so then is it is it densification as far as we understand there is a bit of everything so but this has been the process we don't add the specific capex which is not the the tower the tower reinforcement we don't pay for the antenna movement uh in case there is a there is a movement of an antenna so it's it's it's really business as usual it's a and i think it's a good contract for our client uh the the the price we made for them is a very good second tenant contract because unfortunately in spain prices for second tenancies are a little bit lower than what I would like to have.

That's great. So you wouldn't expect any further announcement with Vodafone Spain at all over the next year or two as they resolve their issue with Vantage? You think your agreement with them is now finished?

As far as we have interacted with them, this is what they told us. then if they will approach us again for having more, happy to serve my clients.

Okay, thank you.

Thank you.

Okay, so the next question comes from Arnaud Camus from Bestinger.

Thank you for taking my questions. On network resilience, could you provide more details on the 15-20 years life protection solution offered to telecom operators, and including the recurring revenue profile and unit economics? And is it fair to assume the opportunities greater in the UK and France? And the second one, given the recent geopolitical context and the growing use of drones in modern warfare, how significant an opportunity could this become for CERNX, particularly in markets close to Ukraine, such as Poland? and should we expect deployments of anti-drones to be mainly driven by public sector contract and how should we think about them within your reporting framework if it's a new tenant and additional collocation or any other type of services thank you okay so when you refer

to network resilience services i suppose we are referring to energy resilient services which is the batteries to give the vulgar name so we buy the batteries at pan-european level so these allow us to have better prices and better conditions better conditions means that we have a guaranteed the life of those batteries for a material number of years that we are extending now we are depending on the supplier between 12 and 15 years is it good it's it's super good because of course if we put the battery have to imagine that those buses can stay indoor or outdoor of course the life of a battery which stays indoor is is longer than the life of battery who stays outdoor because of the obvious conditions even if they don't burn in any case there are there are weather atmospheric elements that shorten the life this is important because when we make an agreement with the MNO the agreement with MNO has the duration of their underlying contractor that we have for the tenancy so if i have a 15-year contract i have to provide these batteries for 15 years so it's important that we have a guaranteed behind us that after seven years i have not to to re remake another cycle of investments because otherwise the business case basically doesn't work Some economics we make more or less with the total is a sort of five to six million a year in this moment with our client, which if you look, it means that good for them, good for us. course this includes also all the maintenance services that are on us so it's it's turnkey so the client has not worried about nothing because because we do everything your second the ease of these potential bigger yes I think it is of course the Spain started first why because they had the blackout by the way now Spain is we created Iberia and Portugal have the same problem as Spain when there was the blackout so people start to be sensitive but I think that this is becoming more a topic a trend a European trend that resilience I see two big trends one is sovereignty and the other is resilience on the sovereignty i can do nothing uh because honestly the batteries uh you can have all the fantasy you want and then you go you end buying in the same place uh on resilience we can do a lot um difference can be defense uh can the the tower be used for defense well defense are big big budget and most of the time when you talk about defense the problem is not the budget the problem is the solution what is the solution we are not we are not a company which make anti-drone system we are not we don't make anti-drone system we have good IT but our IT makes towers doesn't make anti-drone systems of Of course, a tower can be, can host, and so to your question, what is it? It's a collocation, and it's a collocation of a pop. Then, which kind of a pop is it, and who is the client? It's more or less the same animal of a client that is not an MNO. That's it.

So we don't do more than this, and our business model is not different from a usual pop collocation. okay so we've got another we've got another few questions i'm conscious of the time already so let's try and rush rush through now it's fabio pavan now from media banca or maybe not yes hi uh well um thank you for the presentation i think it is interesting to have it today and I was wondering if you can help me in reconciling what we just discussed about this need for the certification to support all these data centers and AI spending capacities with the news we had today with Europe launching the 30 billion plan for gigafactories how we could think about the digital network to be involved because i think this is clearly needed so wanted to have your view on this thank you uh so let me make two points one is uh one of our

peer invested in big data center one of our US peers of course this is giving them a very good very good growth but is draining an enormous gigantic amount of capex and this is one piece of the answer the second piece of the answer is that requires a huge expertise and know-how and i love my engineers but they are telecom engineers and not data center engineers and we don't have this kind of a know-how so we decided that investing on scale on on giga factories on data center etc is not for us this is why we sold our data center in Spain. This is why our proxy of a data center in France has been sold. And this is why we're not going to put our fingers in big data center projects. There are very good specialized companies and we leave to them. Second is somehow what was the question from Achille? So where the data center ends? So there is a portion of the data center which can stay at the foothold of a tower. Fabio, I'm listening to this story since not less than five years. And I saw some of those, I don't know how to call them, remote data center. And at the end, never happened on scale today. But then the point that the kid is making is sometimes it's just too early. Sometimes what is not working yesterday, what was not working yesterday, it was just because it was too early. So is it tomorrow the day that this will happen? We are super active in the technological space.

You know me since ever. you know Simone we are both tech geek very curious so we monitor these and believe me that if there will be an opportunity will be there okay so moving on the next question comes from Fernando Avril Alantra from Alantra sir I think you for taking my questions and two very quick ones first so you targeted five to six times leverage back at the CMD so where do you want leverage to be as things have done today where do you want leverage to be at the end of the decade low upper end and somewhere else in a link to this because obviously this is

the other part of the equation can we assume that you distributed 1 billion last year 1 billion this year should we assume 1 billion as the shareholder return floor for the next day yes with obviously the committed dividends and on top and dividends or buybacks not depending on on the surprise so should we assume one billion at the new four okay so leverage we're going to be between five and six at the end of the decade sorry it seems to be a little bit a stupid answer but it will really depend on the conditions on the market If the market we see with structural tensions, and let me underline structural, because what we see today is a crisis that is driven by energy because of a war that we all hope that will not last long. So, structurally, we don't see high interest rates long term. So, we don't see the need to explore the bottom part of the range. But if you ask me about the end of the decade, I honestly don't know. So, we will be coherently in the range between 5 and 6, depending on the structural conditions on the market. Very good question on the floor. It's a mixed answer. I mean, is it a new floor? No, it's not a new floor. It's the demonstration that when we said that everything that is made available will be managed properly, is what we do. So we said our floor is 800, and if there is more, we would return to Sherolder. If there is more, we return to Sherolder. What about next year? We have a floor, which is 800. If there is more, we would return to Sherolder.

Okay.

Thank you very much.

Okay, so now last two questions. First coming from Avilash Mohata at Exxon BNP.

Hey, hi, good evening. Thanks for taking my questions and thank you obviously for all the details, Q&A and thoughts. I've had a couple of questions on the Q2 results themselves. Firstly, just on slide 9 where you show your net co-rotation growth in, you know, in Italy and Spain. Again, if you look at the growth on an equivalent basis, it's about a third of the total number. So should we just assume that strain growth is mainly Digiran sharing pops and Italy is IoT. And then the second question, just on the cash flow this quarter, quite a strong positive working capital contribution.

Just be interested to hear your thoughts on how you expect that to evolve on a full year basis. is still a sort of neutral contribution or do you expect this to remain positive thank you okay so no it is not iot italy there was some some run sharing and the rest was second tenant the number of builders is relatively modest in italy and And in Spain is DIGI, so it's the majority is run sharing, then we are moving towers for mass orange, net when I move from A to B still remains one, sometime moving one you generated the need of another one so we have some mild growth but we have some growth so spain is dg plus mass orange telephonic and not that much vodafone for the time being no but let's see going forward italy has been uh some run sharing and uh and some uh and some some very interesting some ranching of who some ranching of Vodafone fastweb so Vodafone fastweb who had a run sharing agreement with wind is still making adding some run sharing pop and this tells you that Swisscom is used to a network quality whose KPI are not the same KPI of Vodafone Italy and so they wanted to improve the network quality so that that's super interesting it's something that honestly a bit surprised us so I have next to me the king of the working capital so right more please so on the working capital Avilash basically

as you have seen the second quarter we have been improving following a similar trend to what happened last year we had a first quarter with a negative working capital second quarter improving the working capital there are a couple of things there first there is some seasonality we have some contracts that have different payment terms some of them get paid end of quarter some get paid at the beginning of the night so that always plays but it's true that we have been improving working capital year after year we were having a working capital closer to the eight nine percent of sales we are now closer to the six seven percent on sales we expect to keep on improving we still have some room for improvement both on the receivables but also on the supplier side there is a continuous improvement plan and we expect that it will keep on improving but it's true that the more that we make it more efficient the more difficult it the people having to make improvement. As you know, we always say that working capital tends more or less to zero, so trying to make sure that any growth that we have that has an impact on working capital can be made more efficient and get back to zero.

That's great, thank you very much.

Okay, so the last question from Fernando Cardero at Banco Santander.

Hello, and thanks for taking my only question. It is quite a follow-up on the former dependency ratio question, but with a different scope, more on the short and medium term. As we are approaching to the end of the build-to-suit programs, it's clear the impact in cash flow, but also I would like to understand the impact in organic growth. Or in other words, as we just stand, the build-to-suit program fadeaway should be a positive driver for the pure co-location growth.

Just to understand if there is any, let's say, link between the and of the beautiful terms and let's say some increase on the current trends on pure to a location thank you if you look today that five percent and you split the five percent between CPI collocation and build-to-suit you have a sort of a three percent from CPI plus collocation a little bit more and you have a sort of two percent from it to suit now big numbers if you take this trend you see that we are investing less in build-to-suit so this contribution from build-to-suit is progressively reducing and this is also why the reason why we we're going to 6% we're going 5% now the question is should we imagine a bid to suit down to zero the answer is no we should not expect to down to zero should we expect it down to the huge numbers we had in the past no it's not going to be like this so possibly of course our effort will be to push our machine in order to make more collocation we have several countries in which we can do more and so we have to make a little bit better if the contribution from build to suit will decrease but some some network creation i think it will be more selective it will be with a different contract etc etc but some some network creation would remain so you know you have not to factor that the three becomes five and the two become zero the three will grow a little bit and the two will decrease but it's not going to go to zero i hope i i gave you a help absolutely thank you so it was the last one so before passing to Maria please let me thank all of you for your time for the participation and have a super good and joyful summer vacation Thank You Marco and as usual if you'd like a need to follow up with any questions, you know where we are in the IR team.

We've also purposely left a slide being projected which gives you a link to many documents that we've been posting on the website. So please take a look because there's quite a lot of information which could help further understand the equity story. And I'll reiterate Michael's words. Have a lovely summer holiday. Hello, good afternoon. Welcome everyone to CELNEXT Telecom's first half 26 results presentation. I'm Maria Carapato, and it's a pleasure to be with you today again. Before we begin, as usual, I'd like to remind you that this presentation contains forward-looking statements. Please refer to the disclaimer included in the appendix in the slide deck. So, Marco will open the presentation with the main highlights. Kaimon will take you through the financial performance, and then Marco and Simone Battiferi, our COO, will close with some considerations on other industrial and strategic topics that are often raised by the market. So with that, let me hand you over to Marco.

Thank you. Thank you, Maria. Good afternoon, everyone. So before going into the numbers, let me frame the first half in one sentence. Selenek is delivering exactly on the model with this card to the market, predictable organic growth, expanding margins, accelerating pre-cash flow and tangible shareholder remuneration. Let me highlight the four key messages of the first half. First is that operational momentum remains strong. Organic points of presence growth reached to plus 4.9% year in year, confirming sustained demand from customers across the entire portfolio. This translated into solid financial performance. Revenues grew by 5%, adjusted EBITDA by 6.4%, EBITDA after leases by 7.7%, recurring level free cash flow by 11%, and recurring level free cash flow per share by 18.1%. From a margin perspective, both EBITDA and EBITDA after leases margins increased by nearly 200 basis points reflecting continuing operational efficiencies and land management actions the second is that free cash flow has entered a new phase from 19 million in first half of 2025 to approximately 301 million in the first half of the year this allows us to reiterate our guidance. Third, we continue to deepen our customer relationship. Sunrise in Switzerland, Vodafone Spain, Cellophonic in Spain are all examples of Cellnex being selected as a trusted infrastructure partner for network expansion, contract renewal, and network resilience. And fourth, shareholder remuneration, which is delivered as committed. The 500 million dividend has been paid the 300 million share buyback has been completed and 11.3 million shares are expected to be cancelled during the second part of the year improving the per share metrics i'm pleased to share that today our border directors has approved an additional share buyback program of 200 million euro to be completed until the end of 2026 so overall the message the message is clear our industrial position is translating into predictable growth stronger cash and direct shareholder value creation as promised with the announcement we are making today of an additional 200 million in share buybacks the total shareholder remuneration in 2026 will reach 1 billion euros combining the 500 million of dividends already paid the 300 million of sdb executed in first half of the year and the additional 200 million of share by back just announced between 2025 and 2026 we will have returned a total of 2 billion to shareholders between dividend share by backs representing 11 percent of our current market capitalization there's no doubt that the share by back we are announcing is highly accretive capital allocation decision driving significant growth in per share returns and long-term value creation for our shareholders. With that, let me hand over to Raymond, who will take you through the financial and operational performance in more detail. Raymond, the floor is yours.

Thank you, Marco. Good afternoon, everyone. Let me start with the slide 7, which summarizes the financial performance of the First Hull on a pro forma organic basis. The key message is simple. Thelnex continues to convert predictable top-line growth into higher cash revenue per share. Revenue growth was plus 5%, adjusted EBITDA grew by 6.4% and EBITDA leases grew by 7.7%. At the cash flow level, the current lever free cash flow increased by 11% while the metric pressure grew by 18.1%, reflecting both operational execution and disciplined capital allocation. On the next slide, we show the bridge from reported revenues to organic revenue growth. Starting from the first half 25 revenue base, perimeter adjustments bring us to comparable pro forma base. This results in 2 billion of organic revenues in the first half 26, representing 5% growth year on year, supported by price escalators and continued demand from customers. Moving forward, you can see points of prices continue to show healthy commercial momentum. In absolute terms, second quarter showed strong performance, with more than 2,000 new net odds, and positive contributions across our main regions. In the first half, gross pop growth reached 5.7%, while net pop growth was 4.9%. Importantly, this growth comes despite consolidation trends in some markets. Consolidation does not eliminate investment. Healthier operators continue to deploy more capacity, coverage, and network quality. This is one of the most important messages from the first half. The need for densification remains strong, and Cendnex continues to capture that demand through both collocation and business programs. The operational momentum translates directly into Tower Revenues, as you can see on the current slide. On a pro forma basis, excluding Ireland, Tower Revenues grew organically by 5.2%. Our revenues remain the core growth engine of the group, driven by contractor price escalators, co-location and build-to-set activity. This is the essence of our business model, growing coverage, improving densification and leveraging our existing budget base. Moving to slide 11, our other business lines also continue to provide growth upside. Fiber connectivity and housing services grew organically by 7.8%, adjusted for the French data center disposal and supported by the continued rollout of the Next Loop project in France. Thus, small cells and run-as-a-service grew by 4.5% organically, supported by high demand in high-traffic locations, venues and complex indoor environments. Finally, broadcasting remained stable growing by 0.5% organically continuing to provide a steady and predictable revenue stream we're providing you practical examples of how our industrial strategy translates into real commercial activity first in switzerland sunrise and selnix have extended their long-term strategic partnership through an expanded build-to-suit program covering 300 additional sites this This supports the next phase of Switzerland mobile network evolution and reinforces Celthnex roles as a scalable infrastructure provider. Second, in Spain, our legacy Vodafone framework agreement has been renewed for 10 years, covering approximately 2,000 existing POPs. Importantly, the renewal has been signed on unchanged technical and financial terms, and and Cellnex will also host a limited number of additional POPs on existing infrastructure. Third, Telefonica and Cellnex have extended the backup battery partnership to a total of 3,800 sites, reinforcing network resilience and energy security after the recent blackouts. This reinforces our role as a trusted infrastructure partner and shows how resilience, energy security and network availability are becoming increasingly relevant customer priorities. Beyond our traditional tower business, we are also expanding our presence in DAS and neutral host solutions. For example, Celnex is deploying a multi-operator DAS at the new Valencia football stadium in Spain and expanding neutral host mobile connectivity along the Brighton mainline in the UK. These examples show how Thelmex is actively shaping infrastructure solutions for our customers' needs and their ongoing network investments. Turning to slide 13, operational efficiency continues to be a key lever of value creation for Thelmex. On an aproforma basis, cost per tower decreased by 3.3% year on year, maintaining a high level of operational quality across the portfolio. As a result, we continue to expand margins, with a bit dull margin reaching 84.6% and a bit dull margin increasing to 61.8%, the highest level achieved in recent years. This reflects the operating leverage embedded in our business model, the benefits from our efficiency initiatives, and the continued progress of our land management program. In short, we are not only growing revenues and cash flow, we are doing so with greater industrial efficiency, supporting sustainable margin expansion and value creation for shareholders. Next slide shows the cash flow breach from the first half 26. Starting from a bid after leases, we reached a current level free cash flow of 908 million euros and free cash flow after expansion and built-to-suit CAPEX reaches approximately 301 million euros. The three key drivers behind the result are the solid operating performance, an efficient capital and tax structure supported by optimized cost of debt, and lower built-to-suit CAPEX intensity as the built-to-suit cycle normalizes. On slide 15 shows the free cash flow inflection point where it is clearly visible. Proforma organic recurrent lever free cash flow increased by 11% and recurrent lever free cash flow per share increased by 18.1%. The share buyback program is enhancing per share value creation while the business itself continues to generate stronger underlying cash flows. At the same time, free cash flow increased from approximately 19 million to 301 million the first half 26 an increase of approximately 282 million year on year free cash flow generation is no longer a future promise it is happening now and it's accelerating our liquidity and funding position remain very strong at the end of the first half 26 liquidity stood at approximately 5.3 billion including circa 2 billion of cash and 3.3 billion of undrawn committed credit lines As such, our 2026 to 2028 maturities are largely funded, giving us flexibility to navigate market windows. With that, let me hand back to Marco to discuss some broader industry dynamics and why they reinforce our confidence in the long-term investment case. Thank you, thank you Raymond.

I would like now to step back from the financial result for a moment and discuss the broader industry backdrop. This matters because our equity story is also about why demand for our infrastructure will remain strong for many years. The next slide addresses some of the topics investors raise most often. Traffic growth, direct-to-device satellite, Europe's competitiveness and digital sovereignty, and M&O consolidation in France. For us, the conclusion across all four of the topics is consistent. Europe needs more infrastructure investment, and CELMEX is one of the best positioned platforms to capture this investment cycle. The topic is very technical. So my colleague, Simone Battiferi, our Chief Operating Officer, is also joining us today. And he will walk you through trends in mobile data growth and explain some fundamental concepts on how to devise satellite connectivity. So Simone, make it simple, please, and drive us through the mystery of the technical stuff.

Thank you, Marco, and good afternoon, everyone. Well, looking at slide 18, the key message is that we see a clear positive inflection point in mobile data growth. And in fact, it is accelerating again. Global mobile network's data traffic increased by 22% between first quarter 25 and first quarter 26, confirming that demand for mobile capacity continued to expand at a sustained pace. Importantly and curiously, this acceleration is not yet AI-driven. Latest industry traffic reports make the point clear. AI applications are still a very small portion of total traffic, let's say low single digit today. And there has not yet been a visible AI-led inflection in mobile uplink trend. The main growth driver remains video streaming, the expansion of FWA, and the increasing penetration of 5G devices. And this matters because Europe is still in the middle of the 5G adoption cycle. 5G-enabled devices represent only half of the mobile connection in Western Europe today, and adoption is expected to move close to 95% by the end of this decade. Well, the implication is clear. 5G subscribers already consume around three times more than a 4G user on average. And 5G traffic per user is expected to further double in the next few years. So the maths are simple. As the customer base continues to migrate to 5G in the coming years, overall traffic will increase significantly. Underlying consumer behavior is therefore still pointing to one of data growth above 20%, and more network capacity will be required just only to avoid congestion and present service quality. At the same time, the network of traffic is changing, too. The network is not only being asked to carry more data, but to carry more demanding data. AI-enabled application, real-time collaboration, industrial automation, connected device, future wearables would require networks that are more responsive, more reliable, and more available indoor. They will also increase the relevance of uplink capacity, making networks demand progressively more symmetrical than in the past. So mobile networks are entering a new phase. The question is shifting from do I have coverage to do I have guaranteed quality? And quality means higher capacity, stronger indoor performance, more predictable service levels, better reliability, higher uplink capacity and lower latency. The physics of the networks at the end are simple. Carrying more data requires more capacity. More capacity generally means using more spectrum and adding higher frequency. Higher frequencies deliver more bandwidth, but at the same time, they propagate over shorter distances, requiring a denser grid of cells. Furthermore, they penetrate buildings less effectively, which makes dedicated indoor coverage increasingly important. The only way to solve that equation is to bring a network physically closer to the user. That means densification, particularly in urban areas, that translate in more indoor systems and a larger and more capable infrastructure footprint. So if we go to the slide 19, let me address another topic we are increasingly asked about by our investors, that is the direct device satellite connectivity. Let me start by saying clearly that satellite is a powerful and valuable technology. D2D can play an important role in the broader connectivity ecosystem, especially in remote or underserviced areas where terrestrial coverage is technically difficult or impossible, or even economically inefficient to deploy. Both satellite and terrestrial networks are designed to solve very different problems. Terrestrial networks are optimized for capacity, latency, reliability, and indoor performance. Satellite networks are optimized for extending coverage over very large areas. The reason is not only technological, it is physical. A terrestrial network can reuse spectrum every few hundred meters, saving a very large number of users simultaneously with high capacity. A satellite beam, on the opposite, covers a much larger area, shares capacity across many more users, and has far less ability to reuse spectrums effectively. This is why the average downlink capacity of a satellite D2D connection is today less than 0.1% of a terrestrial mobile network in urban areas and less than 5% in remote location. Said in practical terms, even when constellations are fully deployed, the service will remain much closer to a 2G-like experience, valuable for essential connectivity, messaging, and potentially basic voice, but not comparable at all to mobile broadband. Distance is another fundamental constraint. A low-earth orbit satellite is typical hundreds of kilometers away from a handheld device and sends a vertical signal that in urban and suburban environments must pass through multiple physical obstacles before reaching the user. By contrast, a mobile antenna and a tower is usually a few hundred meters to a few kilometers away and projects a horizontal signal designed to serve users with much higher capacity and better penetration into buildings. This is particularly important because most mobile traffic is generated indoors, we are talking about two-thirds, where satellite signals face a structural limitation. These differences define the role that the right-to-device can play, an excellent complement for coverage, but not at all a substitute for terrestrial capacity. So, if you go to summarize the key takeaways in slide 20. First, satellite D2D is fundamentally a coverage solution. Its strongest use case is sustaining basic connectivity to remote or hardly reach locations a clear evidence of these days is the emergency connectivity provided by satellite during the wildfires raging across spain and france second the capacity gap versus terrestrial network is structural eroded by physics itself satellites are much harder away beams cover much larger area spectrum is reused far less efficiently as signals face more difficult propagation and penetration conditions. So, even if there is a major future technology breakthrough in direct-to-device, the satellite capacity will remain multiple times lower than mobile terrestrial networks. Third, indoor performance remains a fundamental limitation, particularly because most mobile traffic originates indoor. Fourth, handset battery life and antenna constraints create additional challenges for afternoon capacity and user experience so let me say that the conclusion is clear satellite direct-to-device does not replace the need for micro towers network diversification or dedicated indoor solution as mobile traffic growth and quality requirements increase especially in those areas investment in the rest of mobile infrastructure will remain essential well back to you Marco thank you Simone and thank you for these jump into the technology I think you made it simple and clear so really thank you for your effort so Europe faces a clear challenge in terms of

digital competitiveness average mobile download speed in Europe is around 86 megabits per second materially below North America China Korea Japan this gap is increasingly recognized as a strategic issue for competitiveness resilience and security of our continent. GSMA estimates total mobile investment needs in Europe at around 475 billion euro over the next decade. 270 billion just to maintain the ordinary technology cycle which explicitly includes densification to improve quality coverage and performance plus 200 billion more if Europe wants to regain connectivity leadership. I would like to call your attention to yesterday's announcement by Agicom of the Spectrum Renewal public consultation process in Italy and the network performance metric expected from the MNO and please consider that similar regulatory processes are advancing in Portugal and France. The proposed obligations include investment in transport routes, 5G stand-alone coverage, network resilience, and AI-ready networks, all areas that are infrastructure-intensive. And we haven't even begun to talk about 6G, which is expected to kick off in 2031 or 2032. This is the core message for investors. Europe cannot close the gap with spectrum alone or software alone. It needs physical infrastructure, more densification, but a resilient, higher-quality network. And CELNEX is uniquely positioned to provide efficient, shared, and sustainable platform to deploy those networks. Let me finish with France, which is one of the topics that animate quite the discussion around CELNEX. Our view remains constructive. We believe consolidation has the potential to create stronger operators with greater capacity to invest in network quality and infrastructure. As shown on the slide, our direct exposure remains manageable, while the process itself is expected to be lengthy, involving regulatory review, approvals, and a very long transition period. And timing is important. Operators are unlikely to make long-term decisions based solely on the network requirements that we see today. By the time the consolidation process is fully completed, traffic volumes, file-gip penetration, digital user patterns will be significantly different from where they are today, as we already discussed with Simone. In that environment, operators will need better networks, not smaller networks. Over the past decade, France has been adding around 5,000 tops per year, reflecting the industry's ongoing need to invest in network capacity and quality. And despite that level of investment, France still ranks only 21st in Europe and 34th globally in mobile network experience, highlighting the significant room for improvement that still exists. that is why we believe it is important to look beyond the analysis of the respective networks today and focus on the network that operation operators will need five years from now stronger operators with healthier balance sheet with a better position to continue investing densifying and improving network performance our objective is therefore to remain constructive and proactive working alongside our customers to support that next phase of investment. So if we step back from all these industry trends, the message is remarkably clear. Mobile traffic continues to grow. Europe needs to improve its digital competitiveness. Satellite enhances connectivity but does not replace terrestrial capacity. and market consolidation can create stronger operators with greater ability to invest. When we look across traffic growth, digitalization, AI adoption, network quality requirements and market consolidation, we arrive at the same conclusion. Europe will need more network capacity, more densification and continued infrastructure investment. In short, the future requires better networks and better networks require more infrastructure. Maria, it has been a little bit longer than usual. Please, I would like to excuse with our investors and analysts. I am back to you.

Thank you Marco, Raimon and Simone for very clear explanations. So we are now open to take calls. The first question comes from Andre Kavasek from UBS.

Hi, can you hear me now?

Yes, I can.

Good, thank you. Thank you for the presentation and all the very helpful additional color. I have two questions, please, both topics that were touched upon. So, the first one was on the French deal, just from a regulatory perspective. We now know that this will be analyzed locally, and I was wondering whether, from your perspective, there might be any differences to the kind of remedies that you would expect around, say, investment obligations. And obviously, the reason I'm asking is that while we have some commentary from the French authorities around the need to improve networks, it is perhaps not as explicit as a policy as it is from the European Commission with the DRAGSA report. So, any implications of the local jurisdiction versus EC in France would be very helpful. And then the second question, Marco, you touched upon this, but the – and Simone, I guess, as well, but the AGCOM proposal yesterday where the network obligations are, I guess, very conducive for someone like yourself. So, I guess there are two dimensions I would appreciate if you could give us color on. One are the coverage obligations, and looking at the targets that, you know, they set out, or IGCOM sets out, I was wondering what kind of increase in the number of sites and the physical infrastructure that you were talking about do you reckon is needed to comply with these numbers? I believe Inuit suggests something like 20% to 25% to reach some kind of good coverage in Italy or up to 12,000 sites. So, it's roughly your estimate as well that Italy should see kind of an increase in the number of towers similar to that. And secondly, and perhaps more technically, the regulator says there will be a minimum download speed requirement of 150 megabits per second. You make the point that, you know, data traffic continues to grow, and UCLA reported median speeds in Italy at 1Q, exactly half of this proposed floor. So, on that one, I was wondering how these higher speed requirements could translate into more business for you. And again, any estimate of, like, hop increases to get there would be very helpful.

Yeah, sure. So, on the regulatory France versus Europe, I think that it has been a good decision because I expect that the French regulator will be close to the market, closer to the market, closer to the interest of the French. at the end when you design a new when you make a new market design you're asking to a country to renounce to something which is uh the competition on the market so you're making something that is very important and so the citizens the nation the community needs to receive something in exchange so it's good that the regulator is french but i'm 100 sure that there will be a super strong bonding and connection between the French regulator and the EU authorities so ultimately there will be more or less it will be more or less the same with a let me say an easier accessibility of all the other parties that are involved vis-à-vis the regulating authority. So remedies I expect to be the usual ones, the ones that we expect. It's not what, it's the size probably that will be decided by the authority. This brings me to your second question. Your second question is, well, 12,000 new sites is meet high in my expectation I would have said 10 to 15 so 12 you are in the in the mid-high part of Italy of the Italian of the Italian need how much coverage or much densification uh i think that uh the coverage has a permitting process way easier and but it has to be thought uh i would say with the with the business model that has to be more convenient for the operator i would strongly suggest to have more densification more sorry more more sharing more collocation so this is this is what is what is needed now your technical your technical part on on the speed you know that when you move from from the current 5g to the 5g standalone you're not touching just the transmission because the transmission at the end is limited by the core network. So now, a good part of the problems in speed, latency, and responsiveness of the network depends also on the fact that the core networks of the operators are not designed for the 5G standalone. loan this is something that the most of the of the mobile operator make very clear every time my old friend Pietro Labriola makes clear every time he has to invest about on the core network core network are expensive yes core networks are relatively expensive not dramatically expensive a few hundred million euros but the problem is that it's a few hundred million euro each so So you cannot, it's very difficult to share a core network. So if you can be efficient in towers and in transmission, in transport is less obvious. So if you put in your model something on core network, you don't make a mistake. Hope I answered Andre.

Very interesting, thank you.

Okay, so the next question comes from Andrew Lee at Goldman Sachs.

Good evening, everyone. I had two questions. First, I just want to say thanks for the satellite technology articulation around the debate. Obviously a lot of misunderstanding or lack of understanding there, and I think articulating is really helpful, especially given that I think operators have really struggled to do that, which has not helped the conversation. But moving on I have two questions, firstly just wanted to ask have you seen any signs of post consolidation densification acceleration by operators in Spain and the UK? Obviously it's a key area of confidence building in the consolidation debate. Do you have any visibility on when this will begin given it doesn't look like it's started yet? And then the second question, there was a press article a week ago suggesting that SELNECT had been examining strategic options including buyouts, large-scale mergers. I just wanted to ask you, is there any truth to this? I'm not expecting you to comment on specific examples, but do you think there is a material strategic option available and in the context of this just wonder if you could comment on why you chose to buy back shares rather than pay down debt today thank you okay so definitely your two questions are free well Andrew let's start from from consolidation and and Spain and UK In Spain, we start to see something happening.

Mass Orange is well advanced in their integration phase. You saw that last year we had a big bulk of their consolidation. In the second part of this year, we will have a second step that we agreed with them, but as before. now they are working on two on two areas they are working on very very seriously on on transportation corridors transportation corridors Masuranga is is making these as a strategic investment area and they are starting using a small cell way more than what was done in the past especially in problematic dense urban areas so this is good because we are working very strictly with them we are it's not particularly known but we are the largest operator in europe in dust and small cells so we have a big know-how and in particular our Spanish chapter is possibly the most advanced that we have in in the group UK UK unfortunately it's taking longer than what we expected so we don't change our our our view so the fact that something will will happen I'm totally sure that something will happen that there would be a need of some thousands of sites that are that have to be built both urban and non-urban so we're talking about several thousand of sites that that we in our network simulations that we see for the time being different from other market the carrier neutral model for again transport transport lines so the Brighton line is something that possibly some of you use every day what the coverage is provided by us so this is something that again we see but some photos in not in the order of magnitude as we expect is it something I do expect for 2026 honestly powerful is it something that I expect for 2027 yes definitely on strategic option I read what my lawyer wrote me so I stay to my is here in the in the room looking at me so as a leading European player it's natural that the company may attract investor interest at current valuation levels however we are not familiar with the conversation referred to the article so a part of being very well uh very well written uh you you get the sense uh yes it's convenient uh this price for so the reason why we're making the share buyback um so your third question is uh why share buyback and not that repayment well uh you know our our cash generation is doing well and we're convinced that we can do well for the entire year and and these means that we as I told we entered in a different phase in which cash is going to be very evident we're not changing our overall targets for capital structure but today the share price does not reflect our vision on the intrinsic value of the company headwinds are, in my view, overestimated in our price and tailwinds that Simona was saying are not included. So the board is convinced that allocating 200 millions to share buyback at this moment generates value to the shareholders, not only in the short term, but most importantly in the long term. And this is why the moment is correct for doing it now.

Thank you, very clear.

Okay, so the next question comes from Akhil Zatani at JPMorgan.

Hi, good afternoon. Malcolm, if I can start with the shareholder return comments you just made and maybe just ask for a bit more colour. I understand, as you mentioned, it's a reaction to seeing value. But I guess I'd love to understand the general framework you're using in terms of thinking about what you want to do. Because over the last couple of years, we've had a few add-on buyback decisions that you've taken as you felt it was appropriate. If we try and step back and think about the journey going forward, can you sort of help us frame how you're likely to approach your decision on buybacks? Is it going to be opportunistic based on share price? Is it going to be based on more framework-driven decision-making? So just if you could just elaborate generally how you're thinking about the philosophy of what you're likely to do, that would be super helpful. And then the second one was the topic you've mentioned around tailwinds. You talked a lot about various opportunities. One opportunity you didn't mention, which your US peers talk about a lot, is edge computing. And I'd love to understand what your general thoughts are. I appreciate it's a long-term topic, but the US Tower Co's are already starting to make investments in this space. Do you see it a little bit like small sales, where the US pushed hard and ultimately didn't amount to a huge opportunity, and I guess you didn't pursue that at the time? or is it different this time? Is this something that you similarly also see as being an interesting opportunity for Towers midterm? Cool.

Well, on the philosophy, you remember we made very clear that we have a dividend policy that we're not changing. So our dividend policy is 500 million grow at 7.5%, blah, blah, blah. You remember we are delivering. We paid the 500 million and you can bet that next year we will do 500 million plus 7.5 percent second we said the minimum we're going to do is 800 million and the delta between dividends and 800 million is depending on the value creation the value creation is in this moment clearly coming from I'm sure buy back it's I wouldn't describe these as opportunistic I would describe it as a logic or if you want a fundamental analysis so there is a big difference between yesterday today and tomorrow yesterday we may share by back because we had some extraordinary disposal and which make available some extraordinary money that we used today we are making a decision that is based on our capacity to generate cash flow which going forward will remain generous and abundant and we said that we will allocate these these extra capacity in the way that will generate more value to our shoulders as of today the board made the decision that share buyback was the way so I would say that this is the philosophy so let's consider what is the value the value creation, where the value creation comes from, let's see what are the resources available structurally available and let's do it so on your second question it's very interesting because Simone and I, we have been discussing this topic not less than five times in the last two weeks. If I look at what has been done today by, look, for example, NVIDIA and Nokia, it's not really an edge computing on a tower. It's an AI-integrated equipment with a sort of self-configure or AI-driven configuration of the equipment. So it's not really edge computing on the tower. But I'm convinced that the more we enter into distributed AI, the more a system that brings everything to the center is tremendously inefficient in terms of traffic load. So every time you have to transport a lot of data that most of the time are useless. So imagine that you need some AI for self-driving vehicles. Do you really need to have data going to U.S. and coming back, or it's better to have some maps on a tower that is 300 meters from you? I think that this is something that can happen, but it's really at the moment a bit unclear how it will happen. and Simone is working very actively Simone has been in the in the IT and in the semiconductors for a good part of his career so we are activating our contact just stage one I think is better understanding I see an opportunity but as you said it's a midterm opportunity more than the short-term one I hope I answered yes that's great thank you thank you Akhil see you soon okay so the next question comes from

Rohit Modi at Citibank all right thank you for taking my questions I have two pieces one is the follow-up on this question on the on the article and I understand you know you can when you talk to some extent on it but in general your discussions with private players how do you see what are what a key constraint that you see in terms of valuation of towers I mean apart from rates is what is going on in Italy and partly in Spain a kind of rippling effect in the way private players see now tower covaluations with all the renewal risk and yeah so any color around that and secondly you you said you mentioned about the cash flow generation was pretty strong in the one edge again looking at the 1x number and the phasing you had in last two years on your free cash flow and tickering load free cash flow you are heading kind of towards the upper end of your guidance is that the kind of ways we should look for the second half and full year and should that be the base for the next year in terms of when you look at you know the guidance range thank you good I'm looking my lawyer for for i can't add very much because uh so what i can tell you we traded 14 times we traded 14 times it's uh 14 times we trade that more than 10 percent uh recurring

letter free cash flow per share yield i think that there are numbers that speak for themselves we are large we are we are diversified so what I can tell you I honestly I have very little to add cash Raymond hi Rohit look em during the year 26 as you have seen who have massively increased the free cash flow there is a a changing point to a situation where we're gonna be this year between the six hundred and 700 that we gave as a guidance that will grow next year to a level that is from 975 to 1075. We are radiating our guidance and we are not expecting any change on that. This year we are on halfway of the year, halfway in the pre-cash flow. Second part of the year we will see as the first half some built-to-suit is still coming. We will still have some of the growth coming from the location and all of it will help us achieve the guidance that we have given to the market we are not giving any short-term guidance or anything similar because we are just expecting to be as promised between the 600 and the 700 million got it thank you okay so now moving to the next question we have Roshan Ranjit at Deutsche Bank great even everyone thank you for the questions.

I've got two operational ones actually and firstly turn into Spain and the renewal of the the framework agreement with Red French Spain. So I think the first part very very clear renewal of existing POPs under same conditions but you've also added additional new POPs so I just wanted to get a sense of the kind of, I guess, level of discipline in that market. Clearly, you know, one operator's been very strong about wanting to move. So, you know, is there scope for those additional POPs to go higher that you could offer? I know, Marco, you've been very clear on the kind of degree of overlap in that market. Is that still a big barrier for any kind of operator to switch? please and the second question again on the operational side France being a pickup in the BTS deployment it seems quite evenly split between week and the SFR build suits how should we think about that going forward in the context of the kind of ongoing for the true review because I know previously there has been talked about synergies from potentially combining go to suits or a kind of business as usual in terms of the deployment until we get a bit of news flow you know through the air or perhaps next year. Thank you.

Thank you.

So Spain. Our goal number one was we had 2,000 POPs which were secondary POPs that were expiring we wanted to renew and our Spanish team has been able to renew at the same terms and condition we had before so tick the box that we made another renewal without suffering which is one of the of the many headwinds that time to time were to face so we continue to renew ordinary course of business the second part of your question we have been asked making an analysis if some of our towers could be eligible for hosting the antennas from Vodafone we made a technical analysis so some towers the answer was yes some towers the answer was no and we apply the usual price list so we did not make uh any any special favor and uh and we have been asked to host some uh some hundred uh some hundred antenna which is good now to your point is it something it's new deployment or sorry i'm not the cto of vodafone and so uh is it densification is it coverage is it to say the truth i don't know possibilities densification second France did something change in our build-to-suit program due to the SFR split of course yes it's obvious what we are what we are doing is there are areas that are not on the discussion or the crew zone or let me say all the non-dense urban zone is the coverage and coverage is coverage if there is not enough network we build the network and it's good by the way we continue to insist to the concept of colocation to suit so every time we build a tower we strongly insist to have more than one operator in order to make those network more efficient first First of all, for them, in order to avoid that those networks become way too expensive. And in the urban areas, of course, we are working more prudently. We have to avoid to generate new overlaps, even though the consolidation takes time. So, there is some business as usual, but business as usual with good common sense. So, let's avoid it to create today the problem of tomorrow. I think that in this, everybody is well aware. The attitude is constructive, and we have several years of experience with all of them.

So, we're working well with them. that's great thank you thank you okay now moving on the next question comes from Ulthik Raf from Bernstein yeah thank you very much I have two questions please the first one is on BTS Marco on the recent interview that sort of popped up on YouTube you talked about legacy BTS terms that need to be adapted for future BTS can you comment on on how these terms are changing such as the one that you're announcing now for Switzerland if it's not the numbers it's sort of you know which which elements of the BTS are you are you touching my second question is could you provide an update on the land management program in terms of how far you are and how it's going thank you okay I answer the first and I leave the land to Raimund.

Possibly the Swiss case is not the best example of an innovative contract. The Swiss case is a bit more of the same. We had a program with our client. We expanded the program. please keep in mind that the building new sites in Switzerland is quite complex because of permitting it is one of the country with the most severe legislation both on permitting and in the radio in in radio electromagnetic emission limits so it is it is a bit more of the same even though please remember that the Swiss market is really a very a very solid one because of the structure with structure so the when I say that going forward we should imagine something different is yesterday the bill to suit to wear a sort of a forward execution of an M&A so you were taking the M&A I buy a part of the portfolio which is an existing portfolio and then I buy a part of the portfolio which is a forward delivery of at the same conditions which means that the same conditions for the conditions of a world that does not exist any longer rates are different conditions are different etc so what they assume I assume first that towers should be built by design multi-tenant every time we go somewhere we have to make the question day one how can we make it multi-tenant and these can allow to have two semi-anchor fee you should imagine something between a full anchor fee and a full second fee second tenant fee which will be convenient for both at the end and it will be convenient because you build day one the tower optimized for multiple tenants so with the structural exercise the structure engineering that is okay with the energy which is there so you have not to go there twice so you save a lot of money then possibly if I make something like this by design I can buy the land by design and if I buy the land by design possibly we can share part of the benefit because this is something that's all in all I think that the European case suffered a bit of over financial engineering and today we have telecom engineers and telecom engineers work a little bit different work more on on the cost and the value that we are transferring to our clients. So, proximity to the clients, making the network not too expensive, sharing the synergies, sharing the savings that we make. And we are making incredible work on AI applications for infrastructure. Of course, we are specialized infrastructures, so we invest.

That's it. So, yeah, on the land we'll reach. Basically, as you know, we launched in the year 24, the concept of FedLand. It was an entity to be able to accelerate the acquisition of land, but as well, the cash advances on mainly rooftops, in order to achieve an improvement of their efficiencies. This year our cost per tower has been improving month after month. The efficiencies that we have achieved so far this year offset and are a bit higher even than the increase on CPI, that is our target always trying to offset the increase on CPI. Also you will have seen in the numbers in the free cash flow that the efficiency capex and the land acquisition capex is a bit below last year, it remains more or less in line and we're expecting like last year a bit of acceleration in the second half of the year. We have already acquired more than 700 sites this year, more than 1,000 sites where we have non-cash advances and we continue with the same rhythm and the returns that we're getting are very much in line with what we had last year. The only thing is that as Marco has mentioned before, we are being a bit more careful on some places, for example in France today we are looking at the consolidation potential effects to make sure that we buy the site that makes sense buying and we avoid buying sites that can generate a problem for tomorrow but so far the program continues working extremely well and we are not expecting any change rather than accelerating on the second half that's great thank you very much okay now over to James Ratson from New Street Research yes sir thank you very much indeed good evening So two questions, please.

The first one, Marcos, we've kind of talked a lot through the presentation about kind of technological drivers helping to support your growth, whether it's kind of 6G or FWA, more transport connectivity, just kind of growing usage. And then, obviously, today you've announced the deal with Sunrise and we have the AGCOM announcement yesterday, and other drivers as well. I mean, when I take that all together, how do you then actually think about what your organic tenancy growth will do, you know, over the next, let's say, kind of three, five, eight years? You're currently growing your organic pots at around 5% year on year. I mean, do you think that rate of growth is sustainable at that level for the foreseeable future? I'd just love to get your thoughts on putting all these drivers together. what it means for overall pop growth. And then the second question I have was just would love it if you could just kind of dig in a bit further on the answer you gave earlier around Spain to make sure I understand this correct. I mean, it sounds like on the new tenancies you've signed with Vodafone, were they approaching you to ask you for a much bigger kind of potential portfolio of additions, but your pricing was suitably high that you only managed to agree on a few hundred.

I'd love you to expand on that answer you gave a bit earlier to kind of understand the process by which those few hundred new sites were agreed on in the Vodafone Spain contract. no on the technological drivers you have to you have to split it into one is a increased collocation increased collocation if you want to really to understand increased collocation first of all you have to split between towers and rooftops and when you split between towers and rooftop you have to split once again between urban and non-urban on a tower the tenancy can be way more than two because you can go with two tenants plus an FWA plus some other dishes you can you can put a lot of things when you are in a dense urban areas and you have a rooftop going above one he's a it really depends where you are if you are close to the center of Paris it's possible that the mayor does not give you the authorization so all in all our portfolio if you take mature countries which are the countries in which we've been able to grow since more times Spain Italy etc the overall blend goes in the direction of like above two if you take in which is above two if you take mature tower operator they tend to go above two which means that on tower will you are well above two and then on rooftop where you are in 1.5 or 1.6 etc what makes the difference is the price mix because today we have the price mix which in which there is a big difference between an anchor a second and a run sharing so going forward that the densification doesn't bring the same effect of new network creation the economic impact is the economic impact of the second or event sharing and then you have the the future need of further network creation that there will be there will be further network creation as I was saying one one second ago the business model possibly will be different but there will be still to build more towers and I would say that possibly another exercise will be proactively dismantle some towers this is going to be an exercise that i see coming so if i can proactively make some network rationalization this can drive efficiency that can be shared between the tower operator and the mno which once again reduce the appetite for making something bold because we give them we feed them with the savings so that we can make we can make for that is it a 5% growth the sustainable eight years from now only God knows I would say that a 5% pop growth possibly at eight years from now possibly is a bit generous but it will very much depend on how much network creation we will have because I don't think it's going to be zero so this is the big mistake is that people believes that we have already too many towers and and this is this is wrong Spain let me let me try to put a little bit of order did we make special prices for the or eventually higher prices for new location absolutely not so we have a price a price scheme that is is the same that we apply for second tenant by the way we applied to Vodafone the same as we apply to others so we don't privilege and we don't and we don't penalize of course what makes the difference is that if in order to host a new antenna I have to rebuild the tower because I have to make so much capex to strengthen the tower that is an absurd it's a little bit difficult. So the first exercise is if I can materially host you in the place where you're interested because, by the way, you're not interested in every tower I have in my portfolio. So we've been asked for a certain list of towers and we answered which of those list of towers could be eligible, easy, not easy, dramatic. okay, and so then, is it densification, as far as we understand, there is a bit of everything so this has been the process we don't add the specific cortex, which is not the tower reinforcements, we don't pay for the antenna movement in case there is a movement of an antenna And so it's really business as usual, and I think it's a good contract for our clients. The price we made for them is a very good second-tenant contract, because unfortunately in Spain, prices for second tenancies are a little bit lower than what I would like to have.

That's great. So you wouldn't expect any further announcement with Vodafone Spain at all over the next year or two as they resolve their issue with with volunteers you think your agreement with them is now finished as far as i we have interacted with them this is what they told us then if they will approach us again for having more happy to serve my clients okay thank you thank you Okay, so the next question comes from Arnaud Camus from Bestinger.

Good afternoon, thank you for taking my questions. On network resilience, could you provide more details on the 15, 20 years life protection solution offered to telecom operators and including the recurring revenue profile and unit economics, and is it fair to assume the opportunities greater in the UK and France and the second one and given the recent geopolitical context and the growing use of drones in modern warfare how significant an opportunity could this become for CELNX particularly in markets close to Ukraine such as Poland and should we expect deployments of anti drones to be

mainly driven by public sector contract and how should we think about them within your reporting framework if it's a new tenant an additional location or any other type of services thank you okay so when you refer to network resilient services I suppose we are referring to energy resilient services which is the batteries to to keep the vulgar name so we buy the batteries at pan-european level so these allow us to have better prices and better conditions better conditions means that we have a guaranteed the life of those batteries for a material number of years that we are extending now we are depending on the supplier between 12 and 15 years is it good it's it's super good because of course if we put the battery you have to imagine that those batteries can stay indoor or outdoor of course the the life of a battery which stays indoor is is longer than the life of a battery who stays outdoor because of the obvious conditions even if they don't burn in any case there are there are weather atmospheric elements that that shorten the life this is important because when we make an agreement with the MNO the agreement with MNO has the duration of their underlying contractor that we have for the tenancy so if I have a 15-year contract i have to provide these batteries for 15 years so it's important that we have uh guaranteed behind us that after seven years i have not to to re remake another cycle of investments because otherwise the business case basically doesn't work uh some economics we make more or less with the total is a sort of five to six million a year in this moment with with our with our client which if you if you look at me so that good for them good for us Of course, this includes also all the maintenance services that are on us. So, it's turnkey. So, the client has not to worry about nothing because we do everything. Your second, is this potential big? Yes, I think it is. Of course, Spain started first. Because they had the blackout. By the way, now Spain, we created Iberia and Portugal had the same problem as Spain when there was the blackout, so people start to be sensitive. But I think that this is becoming more a topic, a trend, a European trend that resilience, I see two big trends. One is sovereignty and the other is resilience. on sovereignty I can do nothing because honestly the batteries you can have all the fantasy you want and then you go you end buying in the same place on resilience we can do a lot difference that can be defense can the tower be used for defense what defense that are big big budget and most of the time when you talk about defense the problem is not the budget the problem is the solution what is the solution we are not we are not a company which make anti-drone system we are not we don't make anti-drone system we have good IT, but our IT makes towers, doesn't make antidote systems. Of course, a tower can be, can host, and so to your question, what is it? It's a co-location, and it's a co-location of a POP, then, which kind of a POP is it, and who is the client?

It's more or less the same animal of a client that is not an MNO, that's it, so we don't do more than this and our business model is not different from a usual pop collocation okay so we've got another we've got another few questions I'm conscious of the time already so let's try and rush rush through now it's Fabio Pavan now from Mediabanca or maybe not yes hi well thank you for the presentation i think it is interesting to have it today uh and i was wondering if you can help me in reconfiring uh what we just discussed about this need for the certification to support all these data centers planning ai spending capacity uh with the news we had today with europe uh launching the 30 billion plan for gigafactories, how we could think about the digital network to be involved because I think this is clearly needed. So I wanted to have your view on this, thank you.

So let me make two points. One is one of our peer, invested in big data center one of our US peers of course this is giving them a very good very good growth but is draining an enormous gigantic amount of capex and this is one piece of the answer the second piece of the answer is that requires a huge expertise and know-how and i love my engineers but they are telecom engineers and not data center engineers and we don't have this kind of a know-how so we decided that investing on scale on on giga factories on data center etc is not for us this is why we sold our data center in spain this is why our proxy of a data center in france have been sold and this is why we're not going to put our fingers in big data center projects there are very good specialized companies and we leave we leave to them second is somehow what was the question from Akhil so where the data center ends so there is a portion of the data center which can stay at the foothold of a tower Fabio I'm listening this story since not less than five years and and I saw some of those are the I don't know how to call them remote remote data center and at the end, never happened on scale today. But then the point that the kid is making is sometimes it's just too early. Sometimes what is not working yesterday, what was not working yesterday, it was just because it was too early. So is it tomorrow the day that this will happen? We are super active in the technological space. You know me since ever, you know Simona, we are both tech geeks, very curious. So we monitor these and believe me that if there will be an opportunity, we'll be there.

Okay, so moving on. The next question comes from Fernando Abreu Alantra. From Alantra, sir.

Hi, thank you for taking my questions. Two very quick ones. First, you targeted five to six times leverage back at the CMD. So, where do you want leverage to be as things have done today? Where do you want leverage to be at the end of the decade, low, upper end, somewhere else? And linked to this, because obviously, this is the other part of the equation. Can we assume that you distributed 1 billion last year, 1 billion this year? Should we assume 1 billion as the shareholder return floor for the next years? with obviously the committed dividends and on top dividends or buybacks now depending on on the surplus. So should we assume one billion at the new four?

Okay so leverage we're going to be between five and six at the end of the decade. Sorry it seems to be a little bit of a stupid answer but it will really depend on the conditions on the market. If the market we see with structural tensions and let me underline structural because what we see today is a crisis that is driven by energy because of a war that we all hope that will not last long. So structurally we don't see high interest rates long term. So we don't see the need to explore the bottom part of the range. but if you ask me about end of the decade I honestly don't know so we will be coherently in in the range between five and six depending on the structural conditions on the market very good question on the on the floor it's a mixed answer. I mean, is it a new floor? No, it's not a new floor. It's the demonstration that when we said that everything that is made available will be managed properly, is what we do. So we said our floor is 800 and if there is more, we would return to shareholder. If there is more, we return to shareholder. What about next year? We have a floor, which is 800.

If there is more, we would return to Sharoda okay thank you very much okay so now last two questions first coming from Avilaaj Mohata at Exxon BNP hey hi good evening thanks for taking my questions and thank you obviously for all the details Q&A and thoughts I had a couple of questions on the Q2 results themselves firstly just on slide 9 where you show your net correlation growth in you know in Italy and Spain, if you look at the growth on an equivalent basis, it's about a third of the total numbers or should we just assume that Spain growth is mainly Digiran sharing POPS and Italy is IoT.

And then the second question just on the cash flow this quarter, quite a strong positive working capital contribution, just be interested to hear your thoughts on how you expect that to evolve on a full year basis is it still a sort of neutral contribution or do you expect this to remain positive thank you okay so no it is not IOT Italy there was some some run sharing and the rest was second tenant a number built-to-suit is relatively modest in Italy and in in Spain is DG so it's it's the majority is run sharing then we are moving towers for mass orange net net when I move from from A to B still remains one sometime moving one you generated the need of another one so we have some mild growth but we have some growth so spain is dg plus mass orange telephonic and not that much vodafone for the time being no but let's see going forward italy has been uh some run sharing and uh and some uh and some some very interesting some ranching of who some ranching of Vodafone fast web so Vodafone fast web who had a run sharing agreement with wind is still making adding some run sharing pop and this tells you that Swisscom is used to a network quality whose KPI are not the same KPI of Vodafone Italy and so they wanted to improve the network quality so that that's super interesting it's something that honestly a bit surprised us so I have next to me the king of the

working capital so right so on the working capital Avilash basically as you seen the second quarter we have been improving following a similar trend to what happened last year we had a first quarter with a negative working capital second quarter improving the working capital there are a couple of things there first there is some seasonality we have some contracts that have different payment terms some of them get paid end of quarter some get paid at the beginning of the night so that always plays but it's true that we have been improving working capital year after year we were having a working capital closer to the eight nine percent on sales we are now closer to the six seven percent on sales we expect to keep on improving we still have some room for improvement both on the receivables but also on the supplier side there is a continuous improvement plan and we expect that it will keep on improving but it's true that the more that we make it more efficient the more difficult it the people having the big improvement. As you know, we always say that working capital tends more or less to zero, so trying to make sure that any growth that we have that has an impact on working capital can be made more efficient and get back to zero.

Okay, thank you very much.

Okay, so the last question from Fernando Cardero at Banco Santander.

Hello, and thanks for taking my only question. It is quite a follow-up on the former dependency ratio question but with a different scope more on the short and medium term as we are approaching to the end of the build-to-suit programs it's clear the impact in cash flow but also I would like to understand the impact in organic growth or in other words that we just stand the build-to-suit program fade away should be a positive driver for the pure collocation growth just to understand if there is any let's say link between the end of the build-to-suit problems and let's say some increase on the current trends on pure to a collocation thank you if you look today the five percent and you split the five

percent between CPI collocation and build-to-suit you have a sort of a three percent from CPI plus collocation a little bit more and you have a sort of a 2% from built to suit now big numbers if you take this trend you see that we are investing less in built to suit so this contribution from built to suit is progressively reducing and this is also why the reason why we were growing a 6% we're going five percent now the question is should we imagine a big to suit down to zero the answer is no we should not expect to down to zero should we expect it down to the huge numbers we had in the past no it's not going to be like this so possibly of course our efforts will be to push our machine in order to make more collocation we have several countries in which we can do more and so we have to make a little bit better if the contribution from me to suit will decrease but some some network creation I think it will be more selective it will be with a different contact etc etc but some some network creation would remain so you know you have not to factor that the three becomes five and the two become zero the three will grow a little bit and the two will decrease but it's not going to go to zero i hope i i gave you a help absolutely thank you so it was the last one so before passing to uh to maria uh please uh let me thank all of you for your time for the participation and And have a super good and joyful summer vacation.

Thank you, Marco. And as usual, if you'd like and need to follow up with any questions, you know where we are in the IR team. We've also purposely left a slide being projected, which gives you a link to many documents that we've been posting on the website. so please take a look because there's quite a lot of information which could help further understand the equity story and I very appreciate Michael's words have a lovely summer holiday