Quebecor Inc.

Ladies and gentlemen, welcome to this Quebecor conference call. My name is Hugues Simard.

I'm the CFO. And joining me to discuss our financial and operating results in the -- for the fourth quarter of 2024 and also the full-year of 2024 is Pierre Karl Peladeau, our CEO.

Anyone unable to attend the conference call will be able to listen to a recording by telephone or webcast. Access details are available on our website.

The recording will be available until May 29th of this year. As usual, I also want to inform you that certain statements made on the call today may be considered forward-looking, and we would refer you to the risk factors outlined in today's press release and reports filed by the corporation with the regulatory authorities.

Let me now turn the floor to Pierre Karl.

Mercy, Hugues. And good morning, everyone.

So 2024 marks the first complete year of operations after, let's call it, our transformative and game changing acquisition of Freedom Mobile in April 2023. What a year it was, what a performance we have to show for.

Despite being the latest to the Canadian wireless party, the smaller troublemaker who will do and has forever changed the telecom landscape, our 2024 report card ranks us as the Canadian telecom with the strongest and most resilient cash flow, the best profitability once again, the measures and consistent capital allocation strategy. In fact, the only Canadian telecom to consistently quarter-after-quarter reduce its debt while steadily growing dividends and is buying back its undervalued stock.

The lowest leverage ratio and most solid balance sheet, while continuing to invest significantly in our networks and our best of client -- best-of-class client experience and to increase our market share across the country. Our financial results speak for themselves, with cash flow up 17% in Q4 and 18% for 2024.

And EBITDA up 4% in Q4 and 6% for the year. A lower debt and our leverage ratio down to 3.21x -- I'm sorry, 3.31x.

The lowest of the top four telecom in Canada and the only one with improving credit ratings, including, of course, our investment-grade recognition since last May. We are very proud of our steadily improving performance, the resilient execution of our development plan and the disciplined management of our operation and balance sheet.

Rarely has it been seen in the telecom markets across the world that the disruptor maintained the best momentum, the strongest cash flow generation capability, the most robust balance sheet and the only improvement credit ratings in the industry. Before turning to the review of our operation, I would like to comment on a few regulatory matters.

With respect to the FTTP decision, we believe that access to the FTTP on an aggregated basis across Canada is a step in the right direction to lower Internet prices, giving us the opportunity to expand outside Quebec by offering triple-play services, which is wireless Internet and television. However, the CRTC must set proper wholesale rates, which consider the actual retail prices of FTTP services.

We are particularly concerned by TELUS tactics to try and convince the CRTC and they qualify as a new entrant in the Eastern region of Canada. Moreover, the commission interim rates for wholesale fiber set in the fall of 2024, gave TELUS much lower rates for the FTTP access in Quebec and Ontario than in Western provinces, enabling it to compete aggressively in the established -- with the established players, while we are at a disadvantage in the Western Canada due to 17% higher rates for the same FTTP access.

This unacceptable situation prevents competitors from marketing uniform retail offers in all parts of Canada and prevents Quebecor from creating healthy competition in Western Canada by offering a wider range of affordable choices. Quite simply, TPIA rates should be the same coast-to-coast.

Why should Western Canadians pay more for Internet? Good question.

On the CRTC broadcasting consultations, we will once again be leaning on the CRTC to set a fair and equitable regulatory framework that includes a drastic reduction in the current financial, administrative and regulatory burdens waiting on our Canadian broadcasters and that said, meaningful financial contribution from foreign online service. More far too long, these powerful entities have enjoyed an undue competitive advantage, allowing them to access the Canadian broadcasting market without contributing to it, while Canadian broadcasters are subject to numerous regulatory obligations, high cost and a lack of flexibility that impacts their competitiveness and may endanger their long-term perspective.

Honestly, I feel like a broken record on this topic. I've been talking about this for so long, I can even remember when exactly.

I will now review our operational results for the fourth quarter of 2024, starting with the telecom sector. Another solid performance of steadily profitability growth from our telecom operation in 2024, with EBITDA up 1.2% in Q4 and up 4.7% for the year.

These results are a testament to the rigorous and disciplined execution of our wireless expansion plan of profitable market share growth across Canada. The innovative and affordable offers we have introduced over the last two years are increasingly resonating with Canadians throughout the country, and we are retaining customers at levels never seen before despite all the retaliation tactics of our competitors, which bode very well for the future.

In the wireless front, competition continued to massively discount for premium services, offering unreasonable 60% discount during Q4 promotional periods via door-to-door initiatives, simply and stupidly pushing all telecom's revenue down. We responded on all fronts with a disciplined approach of continuing to reduce our operating expenses through better digital execution, more efficient technical and customer service operations as well as improved synergies with Freedom Mobile.

We lowered our equipment subsidies with our BYOD activations, strategically adjusted wireline pricing towards the end of the year and optimized the positioning of our lineup of brands to mitigate pressure on price. Our prudent strategy was successful in overcoming these competitive challenges.

As shown in wireless by the remarkable performance of 88,000 net additions in the fourth quarter, 21,000 more than in Q4 last year, the only wireless player to improve, thus ending the year with the addition of 373,000 net new lines in 2024, reaching a total of more than 4.1 million wireless subscribers by year-end, a 10% growth year-over-year. And in wireline, all services revenues are trending up sequentially as compared the last year.

This continued steady quarter-after-quarter growth in subscribers, market share and profitability is the result of the convergence of our diverse and complementary lineup of brands and services strategically positioned to address the different needs of all Canadian consumers as well as the fruit of long-standing investment in client experience and service excellence. Speaking of customer experience, Videotron, Fizz and Freedom Mobile all stand out in the most recent Leger WOW Index released in January 2025, in which Videotron ranked once again as the top telecom provider in Quebec for in-store experience, while Fizz held its position as the Canadian leader in online experience for the sixth consecutive year and Freedom rose to the third place for online experience.

These impressive rankings truly demonstrate our continuous efforts to exceed customer expectations and our unwavering commitment to unparalleled customer experience, both in-store and on our digital platform. Furthermore, the most recent annual report released on January 15 by the Commission of Complaints for the Telecom-Television Services, the CCTS, clearly shows how our 3 brands continue to outperform the industry in customer satisfaction.

While the volume of complaints law by the CCTS for the industry as a whole jumped by a sizable 38%, Videotron recorded an outstanding drop for the third year in a row, down 14%. As for Fizz and Freedom Mobile, they saw a decrease of 2% and an increase of 6%, respectively.

The results achieved by Fizz and Freedom are even more noteworthy given the major expansion of both brands and the substantial growth in their subscriber base. Our long-standing leadership and client experience explained, in large part, one of our most impressive performance of 2024, and this is the continued decrease in mobile churn, which registered at the lowest of our industry in Q4 and is continuing to come down in contrast with our competitors.

Our growth and performance also based quite simply on giving Canadian consumers what they want and need at the right price. As an example, Freedom recently added access to cutting edge 5G+ technology to all its monthly mobile plans regardless of price.

Existing customers with a compatible phone will also see 5G access automatically added to their existing 5G plans at no additional cost, marking a significant step forward in the democratization of high-speed mobile connectivity. Freedom is also expanding the reach of its Roam Beyond offering, allowing users to enjoy the features of their mobile plan in more than 100 international destinations.

The first in Quebec to offer international roaming plans, Videotron also brought with international destinations to 100 as part of its Canada international plan. Carrying on our expansion plans, Fizz and Videotron -- I'm sorry, Fizz and Freedom also extended their service territory in several Canadian regions throughout MVNO agreements.

Fizz added new subscription zones in British Columbia, Alberta, Manitoba, Ontario and Quebec, giving access to Fizz's 100% digital universe with an additional 2.2 million Canadians. In addition, Freedom enhanced its wireless network in Ontario, Alberta, and British Columbia in recent months by activating 180 new sites.

Videotron expanded its wireless service area in the Gaspesie and Cote-Nord regions and widened its service area in [indiscernible] region. Videotron also announced that it will contribute to improving wireless coverage by building at least 37 new mobile phone infrastructures in Abitibi-Temiscamingue and the Laurentians as part of a partnership with the government Quebec.

With the growing success of Freedom and Fizz, our consolidated wireless ARPU decreased by $1.93 to $34.36 in the fourth quarter, attributable in large part to the dilutive impact of Freedom prepaid services and Fizz entry-level prices, but also due to higher promotional discounts and lower overage revenues as our plans are getting richer to the benefit of all of our consumers. This ARPU decrease has started to diminish recently, and we would have expected this trend to continue going forward had it not been for the creeping discounts and the increasingly aggressive pricing from the Big 3 flankers over the past few days.

As we have said repeatedly, while we are proud of our continuous improvement of our network, the reality is that we need to maintain a price differentiation. On the wireline front, which remain unduly competitive throughout the fourth quarter, as I pointed out earlier, we saw our Internet customer base decline by 2,000 in the fourth quarter, but with a year-over-year growth of 5,000 for 2024.

That said, with our new Freedom owned Internet service, just gradually launched earlier this year and with Fizz TV still in beta mode and currently excluded from our TV figures, we have only just started to scratch the surface of the bundling opportunities which are significant and for which we have the right strategies in place to deliver growth this year. As I said in my opening remarks, 2024 was the first full-year of our transformative and industry-changing expansion plans across Canada.

Our operational and financial results clearly show that we are executing our plan diligently and that our strategies are resonating with Canadian consumers. The clear success of our unique customer-centering positioning force competitors to retaliate on price, thereby diluting the value of their premium service.

Our effective marketing strategies rely not only on great pricing, but also on a second to none customer service, a high performance and reliable network and thus, quite frankly, a way more enjoyable experience overall. Our mobile growth speaks for itself, and we are extremely proud to be promoting healthy competition with innovative peace of mind plans and affordable prices without compromising on network performance and customer experience.

As the Canadian telecom industry continue to evolve after the 2023 seismic change, we are more ever confident in its perspective and in the solid foundation that we are building. We have new services about to launch, new territories on which to gain traction, new network technology being put in place and hopefully, new regulation that will support the performance challenger that we are.

Now turning to the Media segment. TVA Group posted an adjusted EBITDA of $11 million in 2024, a favorable variance of $17 million compared to the previous year.

Despite the continued and significant decline in our advertising revenues as seen everywhere else in the global media industry, we're able to improve our earnings. This were largely driven by the return of major production to our MELS studios and the reduction in operating costs resulting from the restructuring plan for our television operations announced in November 2023.

As part of the restructuring, TVA Group Media, Television Studio, and Quebecor Newsroom will be unified under one roof in Montreal. This ambitious project expected to be completed in the upcoming weeks will provide our media group with top-tier studios as well as a modern newsroom design to promote collaboration and adaptability, allowing us to streamline improving our industry-leading news operation.

Finally, in the Sports and Entertainment segment, we solidify our leadership in the event markets in the 2024 with the acquisition of Evenma, a company specializing in both large-scale and corporate events. This positions us to continue to expand our offering, providing a broader range of events and shows across a wider footprint.

I will now ask Hugues to review our detailed financial results.

Mercy, Pierre Karl. On a consolidated basis in the fourth quarter of 2024, Quebecor recorded revenues of $1.5 billion, a marginal decline of 0.4% from last year.

EBITDA reached $589 million, up $24 million or 4% and cash flows from operating activities increased $57 million to $392 million, a 17% increase compared to the same quarter last year. In our Telecom segment, total revenues decreased by $32 million or 2%, mainly as a result of a declining trend of wireline services and equipment revenues as we are now renting our Helix devices since the second quarter of 2024, but also by opting for a more disciplined approach on mobile devices, lowering our subsidies and significantly improving our gross margin on mobile devices by more than $20 million.

This effective strategy, combined with our rigorous cost management and synergetic gains from the integration of Freedom Mobile helped us increase our EBITDA by $7 million or 1% for the quarter. Our EBITDA margin improved by 2% this quarter and by 0.4% for the year.

Telecom CapEx, excluding the acquisition of spectrum licenses, was up by $42 million for the full-year, but down $25 million in the quarter due to a favorable impact of governmental credits as we increased our investments in 5G network expansions, growth opportunities and leased wireline devices. As a result, our quarterly telecom adjusted cash flows from operations increased by $32 million or 8% and by $63 million or 4% on a year-over-year basis.

The Telecom segment ended the year with a record $1.8 billion in adjusted cash flows from operations. Our Media segment recorded revenues of $195 million or a 5% decrease and EBITDA grew 10% to $15 million for the quarter.

Our Sports and Entertainment segment revenues increased by 23% to $69 million, and the EBITDA of $11 million for the quarter represents a $9 million increase compared to the same quarter last year. Quebecor reported a net income attributable to shareholders of $178 million in the quarter or $0.76 per share compared to a net income of $146 million or $0.63 per share reported in the same quarter last year.

Adjusted income from operating activities, excluding unusual items and losses on valuation of financial instruments, came in at $187 million or $0.80 per share compared to an adjusted income of $168 million or $0.73 per share in the same quarter last year. For the full-year, Quebecor's revenues were up 4% to $5.6 billion and EBITDA was up 6% to $2.4 billion.

EBITDA from our Telecom segment grew 5% to $2.3 billion, an improvement of $105 million over last year -- over the year before. Quebecor's cash flows provided by operating activities reached $1.72 billion, an 18% increase over 2023.

As of the end of the quarter, Quebecor's net debt-to-EBITDA ratio decreased to 3.31x, still the lowest of all telecom competitors and operators in Canada. I would also point out that we are the only telecom company in Canada to continue to regularly reduce our debt and strengthen our balance sheet, thanks to our steady and disciplined cash flow generation capabilities quarter-after-quarter even after investing $300 million in spectrum as well as purchasing and canceling 3.6 million Class B shares for a total investment of $115 million.

We intend to continue to de-lever over the next quarters and operate in the low 3s as we have said before. On November the 8th of last year, Videotron issued $700 million of senior notes in the U.S.

investment-grade market yielding 5.7%. The proceeds were used to repay existing Videotron indebtedness, including the first tranche of the term loan drawings under Videotron's credit agreement maturing on October 3, 2025, and the redemption of Videotron's 5.75% senior notes maturing on January 15, 2026.

Our balance sheet remains very strong with available liquidity of $855 million at the end of the fourth quarter, pro forma the reduction of Videotron's revolving credit facilities from $2 billion to $500 million in January of this year. Our available liquidities are more than sufficient to fulfill our commitments and support our development plans.

Finally, in light of these results and following our plan to distribute between 30% and 50% of our free cash flows, I'm happy to report that Quebecor's Board of Directors declared yesterday a quarterly dividend of $0.35 per share for both Class A and Class B shares, up from $0.325 per share, an increase of 8%. We thank you for your attention, and we'll now open the lines for your questions.

Good morning. You mentioned in your prepared remarks, retaining customers at levels never seen before.

Just curious if you can give us any update on churn in the quarter? And how you're kind of thinking about customer retention at this point?

Hi, Stephanie. Yes, churn is -- we have come to be the lowest churn of the industry, which is a great achievement for us.

As you know, we've talked about this before, we were coming, especially on the Freedom side from quite a higher point and have been bringing churn down over the past couple of years. And that is true for all the other brands.

As a matter of fact, not only Freedom has come down, Videotron continues to come down on churn, and Fizz also continues to come down. And when we blend the three, we are now -- I won't give you the number because we don't release it, but we are the lowest of -- in Q4, we were the lowest of all four -- well, of all -- yes, all four operators in wireless.

Thank you. And then maybe switching over to pricing.

Quebecor obviously continues to win market share with Freedom. How do you think about ARPU growth versus volume growth in the coming quarters?

I saw that you brought your $39 offer down to $35 as a flash sale. Do you see the opportunity for ARPU declines to moderate in the second half of the year?

How should we think about pricing for 2025?

Well, we -- Stephanie, we don't know what will be the outcome of our competitors' strategy. I think that I said that we are always ready to make sure that we will be in a position to retain the way that we would like to address the market.

We certainly also again have some strong experience for our customer service, which makes a difference. So then therefore, we consider that as a significant asset.

On top of which -- and I refer to that also in my prepared remarks, and bundling is now something that we have the capacity to move on. Certainly, it's on a TPIA basis.

We all know this for the other services. But down the road, we'll see how technology will evolve.

We're seeing some fixed wireless technology being implemented. And this certainly is something that we're looking for or we're looking at that position ourselves, I would say, interestingly for the future.

So right now, the bundling strategy on -- not on a facility basis, but on a wireline basis, is something that we're following, and that will give us some additional possibilities to get a retention mode and also on an acquisition basis.

Great. Thank you very much.

[Indiscernible]. Thanks for taking my questions.

The first one is -- one thing investors are trying to assess right now is for how long you can -- you think you can have such high market share gains like we've been seeing in the quarter. So in order to try to assess that, I'm wondering if you're -- if there are new things that you are implementing right now in wireless that could really keep you going in terms of market share gains?

Mercy, Jerome. Well, this is not easy.

As you know, we've never been giving guidance. But what we know is the way that we operate, the way that we execute.

And this is -- this number is certainly not coming by chance. It comes because we're working hard.

It comes because we're moving and what we consider being the right strategies. So we don't know what will be this year.

But again, what will be the competitors' strategy. We know that we've been executing well.

And we look forward to continue the way that we've been delivering it. Maybe it looks simple, but you don't need to reinvent the wheel here.

We did it, and we look forward to continue to do it. Other than, as I just said that with the addition of bundling capabilities, it's even -- could be even more favorable.

And if I may add, we agreed...

Yes, go ahead.

Jerome, well, this morning that you continue to like us as Freedom provides it with solid growth runway. So we agree with that.

And we think that that barely above 10% market share globally or nationally rather, there's quite a bit of runway. So we agree with your statement.

All right. Good to hear.

And Hugues, maybe a second one. Last year, you provided kind of an expected payout ratio for the year.

Are you ready to provide that this year too?

On the -- yes, okay. Well, on the cash flow, it gets us down, I guess what you're looking for is our guidance on cash flow, which last year came out at roughly $1 billion because 30% payout, right?

So on cash flow, we're looking at stability as we've said before, for this year. We believe that we're quite confident in terms of our ability to continue to generate that, call it, billion-ish.

I think we delivered the goods this year, a little over that $1 billion that we had talked about a year ago. And we intend to continue to deliver along those lines.

And the good news is as you probably know, well, as of today, I don't know if it will change. But as of today, there is no spectrum auction in the landscape.

So the -- but roughly $300 million that we spent in 2024 could not be repeated.

Yes, understood. Thank you.

That's a boom.

Good morning. Thanks for taking the question.

First one, just on broadband. In the quarter, obviously, some net losses on the broadband side.

Just curious if you could share your thoughts if that's driven by -- maybe you were more price disciplined in the quarter, and so there's -- you're happy to give up some of the subscriber growth or whether it was an increase in your competitors' kind of promotional intensity that kind of depressed what you were able to win in that market? And separately, on wireless, so you cover 33 million Canadians with your three brands.

I was just curious if you could share your thoughts on what proportion of the market you think that you're kind of effectively addressing with your brands? I mean, really particularly outside of Quebec?

I mean, do you think that like the combination of Fizz and Freedom gets you like half, two thirds, three quarters? Do you think the premium section of the market is growing?

Or do you think it's shrinking? Because you made some comments earlier about how the Big 3 are diluting their offerings at the high end.

So just what you're seeing in the market and where you think you stand to compete effectively and win given your brands? Thanks.

There's a lot of questions here, Matthew.

We only get a chance once every quarter, so we got to take advantage.

Yes, I understand that very well. So I'll try to do my best in answering them.

So on the broadband, well, again, we're the incumbent in our footprint. And we've seen that repricing could be very expensive.

We've been seeing this with our competitors. And we decided that we will not follow that.

Two, obviously, the compensation of not being able to add some Internet subscribers. So should we continue to do to move in this direction?

Obviously, we're not going to give any direction publicly on that for the matter that you understand very well. But I guess that we need to protect our revenues, and this is, therefore, will be the top priority for us.

And where we're not the incumbents as we are in the world less business, obviously, we have more capability. We have this -- but sometimes we're surprised by the fact that even our competitors are lowering their prices and facing the effect for them to be forced to reprice their base.

And we've seen the effect -- the impact of that on the way that they've been delivering results for the 2024 year. So we think that we have -- and this goes to your second question, how do we see the Canadian market?

We think that our brands, Freedom and Mobile -- Freedom and Fizz are the ones that is attracting the larger portion of the market. is this 75%?

Is it the 35%? Is it 90%?

What would be the premium market? Is the premium markets shrink or is shrinking?

We can even answer positively to this question when we're seeing the flanker strategy of our competitors. They are the ones sometimes that is moving to reduce what we can consider being the premium market.

Previously, obviously, there was only one market when the three operators were only commercializing their premium brands, but things change. And what we've been seeing with certainly also the immigration, we'll see what's -- where the immigration will go in 2025 is we're certainly seeing this portion of the market growing instead of shrinking and then therefore, probably to the effect of shrinking the premium market.

So to conclude, I would say that we are very well positioned in the largest market share available.

That's great. Thank you so much for the color.

Yes, thanks very much. Good morning.

Hugues, maybe for you, just the normal housekeeping on CapEx for 2025 that you normally provide for Telecommunications and maybe the wireless EBITDA as you see it in Q1? And then the third question here, just in terms of what you're seeing through Q1 here on volume.

Pierre Karl, you just talked about characterizing the market you play in, we clearly saw some moderation of industry volume in Q4. Just wondering what you're seeing from your perspective in Q1 in terms of wireless market expansion and overall volumes?

Thank you.

Thanks, Drew. And on your first question, so CapEx guidance for the year.

We've talked about this. Last year, we ended up on Telecom, just a little under 600 and a little over 600 on a consolidated basis.

We're looking at 650 as guidance for Telecom CapEx this year for 2025 and just slightly higher than that on a consolidated basis. So that should -- as we had said, there's nothing new in that message.

You will remember that we had said last year that we were going to gradually increase CapEx, and that's what we're doing. I'll let Pierre Karl pick up your second question.

Your third question.

Your third question, yes, that's right.

I think, Drew, you were referring to the Q1 '25?

That's correct.

Well, we're not going to be able to give you full disclosure. But what I can say is that we -- that you guys are well aware about what is taking place.

So I would think it's slower than last year. It's a little bit slower than last year.

Okay. Perfect.

Love for you to elaborate, but that's fine. And then hearing just back on wireless EBITDA for Q4?

We don't give it out. I'm sure you guys will be upset at me now, but we gave it out for a while without really giving it out.

And the reason, as I explained before, is not trying -- we weren't trying to be coy. It's just that we run this business and especially on the OpEx side, you will all understand that our -- for example, our client service and our technical services are all run as one company.

So if you want to split it out, you have to make allocations, which are in and of themselves, estimates. And we felt that this was not reflective of reality and decided to stop doing that.

So all I can tell you is that you see the global increase in profitability and both wireline and wireless are growing. And I'm sure you can work out the split amongst yourselves, but we will not be splitting it out any more than having to justify allocations that, for example, you remember last quarter because of stock-based compensation that was unallocated evenly, it threw out some odd numbers.

So we're going to go away from this now and just give you the consolidated EBITDA.

So I'm happy that you're upset again. Yes, you, and not against me.

Understand. Thanks very much for that.

Thanks, Drew.

Thanks for taking my question. Just a couple for me.

First of all, on the adoption of Fizz outside of Quebec in the newer markets, can you just talk to sort of the shape of adoption there and how that compares with what you experienced in originally when you launched it in Quebec all those years ago? Is there -- are there any different dynamics that worth calling out?

And then secondly, with respect to the bundling of Freedom with the Internet product, I mean, we've been seeing the advertisements for a while now. Has there been an inflection point in that uptake there that's worth discussing?

Or are we still very much sort of talking negligible numbers? I wanted to get your thoughts there as well.

Thank you.

Okay. On the Fizz side, well, this is a new brand.

And we're not going to spend billions of dollars to make that brand known. What we're seeing, and this is special also to Fizz because there's some personal reference.

You can gain certain gift if you bring additional customers. So we consider, and this is our experience we have in Quebec that we're starting slower, and we're going bit by bit increasing by the fact that the knowledge of the brand is being expanded and the experience throughout the digital universe is also being better known.

So it's slower, but solid, I would say that. Is it comparable to our previous experience?

I would say almost. And for the -- for Freedom with TPIA, I would say that it's a little bit about the same.

Freedom is obviously also known as a mobile brand. We need to make sure that -- because our experience in Quebec is that TPIAs have been there for many, many years.

We can't say this as strongly in certain areas in Canada. I think of the western part of the country.

There, we need to work harder to make sure that the Freedom Mobile first, which was not as strong as it was in Ontario, would be better known. And then our TPIA opportunity will also be known.

So we're expecting the same trend something that will grow not at a magical rate, but steady rate bit by bit on an everyday price, I would say. And this is what we're looking for, and this is what we expect to be able to deliver.

Thank you very much. I'll pass the line.

I have follow-up -- some follow-up questions on the free cash flow guidance. And just -- if we step back and take a big picture about 2025, how should we think about your Telecom top line and EBITDA?

Because the reason I'm asking is, you took some price action on Freedom recently with some price increases and repricing, let's say, obviously, to stem the decline in ARPU that you're seeing in that business. But as mentioned earlier, we're seeing the incumbents for some reason, which I still can't get -- go back on the attack and reduce prices this week.

One, do you think this is because volumes have been so soft that they're trying to make -- get their quarter in? And if that's the case, why shouldn't we expect that price action or price pressure to continue throughout the year?

And how should we think about that in terms of you being able to grow top line in Telecom in 2025? Is this something you're hoping to achieve?

Or at this point in time, you see it as more upside surprise and we should maybe think about top line as flat to down for 2025? That's one question.

The second question I have is on free cash flow. Just wanted to make sure, when you said that we should think about free cash flow to be in the same range as last year, you're talking about dollar terms or the distribution rate to be the same?

I understood that it's a dollar term. But how should we think about in that context, the $300 million that you spent on spectrum, how are we reallocating that within the spending pattern in 2025?

Thank you.

So I'll start Maher with the first one. You guys know those guys are much better than we do.

You guys talk to them on a quarterly basis. You should be able to answer the question because honestly, I don't know.

I don't know what they have in mind. So again, the only thing I can say is that we will continue as we've been facing this situation for a while.

It's -- it is -- I refer to what your colleague wrote this morning. It's about price aggression.

Pricing aggression writes this. I mean, we're facing this.

And again, we're not going to let our market share, our positioning moving to the false direction. So again, we're reacting, and we're improving our customer service.

We're improving our services, we're adding some opportunities, and we're making our brands better known. All those things, bit by bit.

There's a list of a dozen things that we're doing, which is able somewhere to refrain what our competitor is doing. And you are probably right.

Sometimes, we've been seeing this at the end of the quarter. I don't know, are they -- is there a bonus paid on RGU achievements?

I don't know. But certainly, it's a little bit weird.

But we're used to seeing this, and we're -- we will react accordingly. So on the free cash flow, just before to answer, I think it's important, again, to mention that we are disciplined, and we are the only company that is able to reduce our debt.

We will continue to do so this year. And our free cash flow is free cash flow.

It means that it's all -- it's after all expenses. It's after our interest, obviously.

It is after our taxes. It is after leases.

It is after capital expenditure, it is the money that we're bringing to the bank. This is our definition.

And we expect to continue to deliver strong results in 2025. I don't know if you have anything to add?

I think you've answered the question. As to allocation, as there is no spectrum purchases, as Pierre Karl said, we look -- we're looking at reducing our debt more this year than we did in 2024, knowing that where dividends are going.

So there'll be a slight increase in dividends, but nothing major. And...

There is also price to weigh or consider on the dividend policy. I think that we've been talking to you for the last, what, three, four years now.

It's well established. The Board of Directors are completely in sync with that.

So we look forward to continuing the same strategy for the years to come.

Exactly.

On revenue growth, are we to expect revenue growth to turn positive sometime in '25 on the Telecom side?

We expect this to take place.

Thank you.

I would say we expect that we open.

Sometime in '25. Thank you.

Okay. Thanks.

A couple of questions. So looking at the mobile equipment revenue, I thought it would have been a bit higher.

So I guess the reason why it wasn't, is it because you're just seeing more BYOD new ads come on stream?

Well, prices -- well, yes, there's some BYOD, but it's -- I mean, it's all about ARPU, right? It's all about prices.

Q4 is a competitive, is a promotional quarter as it always is. And you saw where ARPU -- I mean, we are stabilizing ARPU or starting to stabilize ARPU, as you saw, which sequentially is coming down a little bit less than it had been for the past few quarters.

But it still is. So obviously, that mathematically just impacts the top line.

But we pick it up on -- we picked up quite a bit, as I said in my remarks, on subsidies to help us increase profitability. So -- but mostly the top line impact has to do with the pricing.

So who knows, as Pierre Karl said, for Q1, but where is it going to go? We'll see.

Okay. So I was talking primarily about mobile equipment revenues.

So do you mean that you're -- the reason why the revenue...

I'm sorry. Okay, I misunderstood your question.

On mobile equipment, yes, we lowered -- it was a lower volume on -- first of all. And secondly, we were, as I said, on subsidies, a lot more disciplined.

So it was, all in all, a much more disciplined quarter in Q4 than the previous one -- than the one in 2023.

Okay. And then when we look at the CapEx, you signaled that the Telecom CapEx would be $650 million or thereabouts in 2025.

Is most of that growth being driven on the wireless side? Or is -- you're also increasing CapEx on the wireline?

Well, it's both. It's both.

This is -- we are continuing to invest in increasing our investments in wireless, but wireline is also continuing to be -- we have technological advances that we are working on in wireline on the DOCSIS front, and we will continue to invest in our wireline network in Quebec for sure. So it will be both, really.

Okay. And then you talked about on the wireless side, you want to have a bit of a price discount relative to the Big 3.

Is there sort of a range that you try and stick to like you want to be 10% lower or 20% lower or something like that?

Well, we were comfortable. I'll answer more.

We have been -- I think if you look back throughout 2024, David, you will see that we have reacted and have tried to maintain a few dollars. It ebbed and flowed a little bit, but it's -- yes, it's sort of a handful of dollars advantage on a monthly package.

And this is sort of a spot where we were comfortable. And if our competition is -- as they have tried or as they are trying over the past few days to diminish, then we feel that we need to maintain that advantage.

So we've put -- we've reacted accordingly this morning, as you saw, and we'll see how that goes.

Okay. All right.

Thank you.

Yes, thanks. I just wondered if we could just revisit a bit, the idea of subsidies?

Because, I mean, obviously, there's rate plan competition, but there's also been some -- there were some aggressive moves in the fourth quarter with respect to handset promotions. Could you give us an update there on what you're seeing and how you'd react?

And then just follow-up, Pierre Karl, you mentioned you're, I guess, contemplating fixed wireless access. Is this a 2025 thing?

Is it outside of Quebec thing? Just any thoughts you could share there would be helpful.

Thank you.

Okay, Tim. Well, yes, what we're seeing is interesting technology.

We're not going to obviously go full blown there. We -- in fact, we are -- I will go in Barcelona next week.

This is the World Mobile Congress. We're going to have the chance to again, chat and talk with our suppliers, where they already saw some interesting implementation.

o again, it's not going to be full blown. This is something that we know that have possibilities, opportunities in the future.

We're not -- we will continue to move in the direction that we've been moving previously. I think this is something as something that should be considered as a possibility to grow and some incentives to move forward with our network expansion, which we will do, obviously, because we expect to be one day or another, a full facility-based wireless operator.

And this is, I would say, not a weapon, but certainly an asset that we should consider and the toolbox that is -- that will be available for the telecom operators in the future.

And Tim, on Q4 subsidies. Quite simply, we just didn't -- we tried things out.

We released, as you saw, our Black Friday end of year promotions with a more conservative approach, a little bit on the subsidy front and felt that we didn't need to be more aggressive to keep our momentum during the quarter. And we tweaked to this, we went along.

And -- it was just -- as we are building other levers to pull, and I think that's a proof that we are successful in building these other levers than having to -- in Q4, which is traditionally a very strong quarter for equipment subsidies. We felt -- and we were in a position not to be being able not to be as aggressive.

And we were then a bit more disciplined, which will, as I'm sure you've understood, which will certainly help our future ARPU stabilizing and eventually perhaps even growing.

Thank you, Tim. We didn't have any questions from Vince?

He's on a plane. He sent me a...

He's on a plane. We wish him well.

So he couldn't be here this morning.

So we thank you all, and I wish you a nice spring break and talk to you next quarter. Thank you.