Tele2 AB (publ)

Thanks everyone and welcome to the second quarter report for Tele2. With me today, I have Mikael Larsson, our CFO and Samuel Skott, our Chief Commercial Officer.

Today we'll walk you throught the results for the quarter and we will run a Q&A session afterwards where we can address your questions. Since I became CEO of Tele2, I talked about the challenges that we've faced and dealt with during our ongoing pandemic in order to reach our goals.

With the approach from every society on the horizon, I can now safely say that we are overcoming those challenges and we are starting to see a turnaround in the financial results. I think I provided in May, we presented our plans for our commercial business as well as the crucial IT and technology transformation that enables it all.

I am happy to see that the plans we've set are already starting to show positive signs as I'll briefly explain to you as we go through the figures of this quarter. So let's then turn it over to the numbers.

End user service revenue returned to 2% growth for the group in the quarter as Baltic continued to AUL and we saw clean [ph] as we grew B2C and we saw a trend ship with even B2B compared to [indiscernible]. Strong performance in the Baltics, execution of the business transformation program and lower commercial spending has even led to a underlying EBITDA growth of 8%.

We continue to invest in 5G in Sweden. So we are not yet at our full year run rate, which you can see in our CapEx for the quarter.

We expect to increase the steep in the second half and onwards as we ramp up the 5G rollout in Sweden and eventually stock in the Baltics once we required to spec [ph]. During the quarter we made our three [ph] for our shareholders with about the first half of the ordinary dividend and in July, we paid an extraordinary dividend of SEK3.

The remaining SEK3 of the ordinary dividend is scheduled for October meaning that we'll have the super dividend of SEK9 this year to shareholders. This is in line with our vision of having superior shareholder return.

With especially combined two of the most iconic consumer brand in Sweden into one strong premium brand, which concludes the first phase of our FMC chart. During this phase, we are sure that we'll take the responsibility of the market to our value based strategy and we see that our more for more price adjustments are now improving the topline With roaming revenue now roughly at the same level as last year and other areas that are particularly affected by the pandemic such as CD and mobile prepaid stabilizing, we were able to grow Sweden B2C business for the first time.

In Sweden B2B, we continue our long segment approach to take market share within SME, increased profitability in large private enterprise and defend our position within the large public enterprise segments. The initial results are promising and we see that the new mobile portfolio for small business we launched in the February quarter is starting to bear fruits.

While it will take some time to turn the B2B business back to growth, we're starting to see the end user service revenue shift materializing and we are on track towards stabilization. We see the fantastic performance in the Baltic continue with strong end user service revenue and underlying EBITDA growth.

This is come to our more-for-more strategy as we've seen monetized increased demand for data and leverage our different market positions in each market. With this, I'll move over to the Swedish consumer segment on Slide 4.

The consumer market is in a similar state as the previous quarter with lower activity due to COVID-19 restrictions, together with the price adjustments which always come with slightly elevated chart, this led to a negative intake in mobile postpaid. In fixed program, we really saw how resilient the business is as net intake remains relatively strong despite net revenues from the pandemic, pricing adjustments and the removal of most well-known fixed broadband brand in Swiss markets.

Price adjustments in postpaid and fixed broadband supported continued results in the quarter and cable and 5G turnaround after revenue from premium sports is back. Total revenues of service revenue increased 1% as growth in mobile postpaid, fixed broadband and cable and 5G compensated for a continued decline in legacy services.

And now let's move on to B2B on the next slide. Mobile net intake was positive with 10,000 revenue generating units in the quarter, driven by improved net intake in the small segment and new contracts within the large segment.

Mobile ARPU continued to decline although at a lower rate as roaming has been neutralized in the quarter. While we saw improvements within mobile total end user service revenue declined by 2% mainly driven by continued decline in legacy fixed service.

On the whole, I would say that performance is in line with the trajectory; we AI at the capital markets space. We are seeing a trend shift, which has continued throughout the year and then lead to stabilization in 2022.

The price pressure of course persists since there is a tough market. However, half the trends are already improving slightly compared to previous periods, even if you exclude rolling.

While we have a journey ahead of us to get back to the broke, I think it is a good site that we can get volume growth, while maintaining discipline on prices. So then let's turn to Slide 6 for an overview of Sweden.

End-user service revenue was flat in Sweden as growth in B2C compensated for decline in B2B. Underlining EBITDA increased by 7% through continued execution on the business transformation program, lower commercial spend and less headwinds related to the pandemic.

We continue to see strong cash conversion of 65%, despite increased CapEx related to the 5G rollout in Sweden and IT investments related to the business transformation program, as we keep growing underlying EBITDAaL. And then let's turn to Baltics on Slide 8.

We saw strong net intake in the quarter for the Baltics driven by mobile and postpaid in Latvia and Lithuania. We continue to see strong ARPU growth due to continued monetization of data, driven by price adjustments for more and more campaigns and slight recovery of roaming revenue in Latvia and Estonia.

Let's turn to the next slide please. We continue to see fantastic financial results across the board in markets.

End-user service revenue increased by 13% in the quarter with strong growth across all markets as CO VID-19 headwinds starting to abate that showed signs of slight recovery. Higher end user service revenue led to an underlying EBITDA growth of 10% on an organic basis.

Strong growth in underlying of EBITDA together with low capital intensity as we are in between investment cycles ahead of the 5G launch and the spectrum position overall led to an 83% of the cash conversion. With that, I would like to hand it over to Mikael to go through the financial overview.

Thank you, Samuel and good morning, everyone. Please turn to Page 11 in the presentation.

I think previous quarters, we have taken this slide to illustrate each revenue line, excluding roaming. Please keep in mind that the organic growth numbers on this slide are adjusted for FX changes.

As we can see on this slide, as Kjell previously mentioned, we now see some pandemic headwinds starting to abate in the quarter and in the comparable figures we have for the first time a full quarter of COVID-19 impact. As a result, with the outbound roaming giving a tailwind of SEK80 million for the group in the quarter.

But we are able to grow end user service revenue, even if we exclude this from the numbers. Mobile postpaid grew by 1% ex-roaming, and fixed broadband increased by 5% driven primarily by price adjustments.

We saw most of the effects of the price adjustments this quarter, and we expect the full effect from Q3. As premium sport content now has returned, we are able to grow our cable and fiber TV business with 3% compared to Q2 2020.

However, it is not fully compensated. The continued decline in the legacy D2C business resulting in digital TV end user service revenue declining by 2% in the quarter.

Total end-user service revenue in Sweden B2C grow by over 0.3% in the quarter, excluding roaming, as growth in mobile postpaid, fixed broadband and cable and fiber TV was offset by decline in legacy services. In Sweden and B2B, slightly improved trends within mobile end solutions were not able to fully compensate for the continued decline in fixed legacy services and end user service revenue declined by 2% excluding roaming.

And in the Baltics, we see continued strong performance resulting in 12% growth in end-user service revenue, excluding roaming, and this was driven by higher ARPU growth on the back of price adjustments through our more-for-more strategy and also pre to post paid migration. All of this resulted in the group growing end-user service revenue by 1.6%, excluding roaming and 2.0% including roaming in the quarter and this marks a turning point for our business, from the negative growth numbers we have seen for the group over the last quarters.

Let's move on and turn to Slide 12 for a walk through of the group results. Continued strong development in the Baltics, execution of the business transformation program in Sweden and lower commercial spent drover an underlying EBITDA increase of 7% organically.

Items affecting comparability was roughly at the same level as Q2 2020 and was mainly driven by restructuring costs related to the business transformation program in Sweden. Depreciation and amortization increased during the quarter as we now start to amortize the book value of the premium brand, following the merger with a Tele2 brand in the quarter.

We also saw some impairment related to the IT transformation in the quarter. The release of a provision related to a tax dispute with the Swedish tax authorities resulted in a positive non-cash effect in the quarter of SEK21 million on net interest and SEK350 million sec on income tax.

Let's continue by looking at cash flow on Slide 13. Timing of customer equipment CapEx in Q2 last year led to decrease of CapEx paid this quarter compared to Q2 2020.

We saw a positive change to working capital in this quarter and that was primarily explained by Financing in the Baltics. Taxes paid were affected by timing of withholding tax on intercompany dividends from the Baltics.

And finally, we continue to see strong cash flow generation with equity free cash flow of roughly SEK1.3 billion in the quarter and a SEK4.7 billion in the last 12 months and that is equivalent to roughly SEK6.8 per share. Please move on to Slide 14 for the overview of the capital structure.

Leverage was unchanged compared to last quarter as growth in underlying EBITDAaL was offset by the distribution of the first traunch of the ordinary dividends in April. We continue to be in the lower end of our target range of 2.5 to 3 times of the extraordinary dividend, which was paid out in the beginning of July.

If we adjust for this leverage would have been 2.7 end of June. So, so far this year we have distributed SEK6 and in October we'll pay off another SEK3 per share as the second traunch of the ordinary dividend.

And we can do this while maintaining our leverage comfortably within our target range. On top of the underlying cash generation of the business and levering effects of growing underlying EBITDA, we also have the opportunity to crystallize value for our shareholders through our stake in T-Mobile Netherlands.

Since the Netherlands is not part of our group cash flow, a potential exit and distribution of the proceeds will not affect our ability to distribute cash to shareholders and maintain a very young risk remuneration policy afterwards. Let's continue with Slide 15, where we'll show an update of the business transformation program.

We continue to execute on the program and we reached an annualized run rate of SEK350 million at the end of Q2. This resulted in SEK80 million in cost reductions from the business transformation program, affecting the P&L during this quarter.

The savings during the quarter counts on efficiency improvements within the technology, IT and commercial organizations, as well as support functions. We remain committed to reach roughly half of the SEK1 billion tech targets by the end of this year and the rest by the end of 2022.

And with that I will hand back to Kjell to go through the updated guidance and our key priorities going forward.

Thanks very much, Mikael. So then let's please turn to Slide 16, to go through our updated financial guidance.

As society gradually returns to normal, we see that the negative effects from the pandemic stock rebates. As a result, we are more confident than we were in February, when we gave the 2021 guidance.

Hence we update our 2021 guidance for end user services revenue from flat previously to flat to single low single digit growth and underlining EBITD from 2% to 4% growth previously to mid-single digit growth. The guidance from CapEx excluding spectrum and leases remains unchanged as we aim to ramp up the 5G rollout in the second half of the year.

With this 7% growth in underlying EBITDAaL in the first quarter, this full year guidance of course implies a slight slowdown in underlying EBITDAaL growth in the second half of the year. The reason is that while the current market environment is good for our margin, as it keeps commercial Cost down, we want to make the necessary investment to achieve a sustainable balance between volume and price, in order to grow and use the service revenue sustainably.

So if mid-single digits growth is four to 6%, you should not expect us to be in the upper part of that range, since we want the flexibility to invest in growth in the second half, so that we can hit the ground running into results in '22. Please turn to slide 18 for our key priorities going forward.

With the strategy and the mid-term ambitions set out by the capital market stay in May and when the post genetics exercise the on the horizon, it is time to recalibrate our business towards a strong focus on growth. I think those investments are essential for delivering a great service and customer experience.

While it's solidifying our premium position in the market by balancing volume and price to our more from our strategy. In Sweden, we will continue to execute on our infrastructure investors, both in the mobile and fixed networks with 5G and revolt five.

We are on track with our plan to ramp-up during the second half and aim for the higher end of our capital guidance range during 2022 and 2023. The execution of the business transformation program is progressing well and we stay committed to deliver an analyzed run rate of SEK 500 million at the end of this year and at least SEK 1 billion at the end of 2022.

In Sweden B2C, we will now enter phase two of our FMC journey with a new consolidated into two brands. While, the first phase was all about building the loyalty and the existing overlap among our fixed and mobile customers.

The second phase we'll be focusing all offer focused on offering a truly convergence customer experience on the one single brand by cross selling is a 1.3 million known FMC households within our footprint without only one of our services. The emphasis, however, it will be on the validate FMC strategy to gradually increase penetration in our customer base.Sweden,B2B is starting to become a good story.

The B2B market has never been an easy market, but with a solid strategy in place, the internal parts are in place. And we now need to shift from planning mode, execution mode to continue the trend ship in 2021 and move to stabilization in 2022.

In the Baltics we will build on the current momentum and execute our mobile centric conversion strategy through more of a more offers, while preparing for a nationwide rollout of 5G,one suspect of auctions are concluded. We'd also further develop our FMC opportunities by looking at our own and third party infrastructure capabilities.

I'm also very happy that we were able to announce a strengthened group leadership team earlier this week, which Ronald Thompson, joining as a CFO and headed the post as Chief Commercial Officer. So I've been brought and valuable experiences from a number of industry while handling to commercial FMC extract that we need in order to achieve to achieve in phase two of our FMC journey.

I look forward to working with both of them. With yet another strong quarter behind us, I'm more confident now than ever that we will deliver on our mid-term guidance and achieve our ambition to become the leading telco and the North Baltics region.

With that, I'll hand it over to the operators so we can move to Q&A.

Okay. Good morning everyone.

I had a question around the declining parts of your business and improvements you've made you've had with within those in the second quarter. So, specifically digital or digital and TV and B2B, I guess key investor question is how sustainable are these improvements and that the direction of travel.

So on digital TTV you had been saying that you could stabilize additional TV trends in the second half of the year. I think obviously you've inflicted the growth in the second quarter.

So what's, what's your outlook now for the rest of the year on TV and into 2022? And then on the B2B side, you mentioned, you reiterated a couple of minutes ago that showed that would look to stabilization in 2022 which is what you said at your Capitals Market Day but obviously a big improvement in B2B than people expected in the second quarter says that scope do to think that actually see stabilization sooner than 2022 in the second half of the comments to reassure on the sustainability would be really helpful.

Thank you.

All right. I will start with B2B and then Samuel will talk to you about 3G of course.

Yeah, we're very happy to see that the B2B has made significant improvement throughout the last couple of quarter and that's very, very helpful for our profile for sure. Yes, it would be very nice to see the run rate stabilize at the end of this year.

I'd just emphasize that we are on track and we're getting there because it was a big concern for you guys, for me, for everyone at port and now we're quite confident that we're getting back to stabilization and we'll work as hard as we can to bring that to a run rate stabilization by the end of this year that is of course a innovation that we would like to have and maybe to the TV side.

Yes so hi Andrew. Good morning, everyone, Samuel here.

So for TV I see now we have a strategy to continue to modernize our TV business and in the way stabilize this may not reaching growth that stabilizes and if we take out the kind of the premium headwind that we see in Q2, we're definitely seeing an underlying improvement also without that premium part. So the trajectory is also underlying for TV.

Thanks for hosting the call and question today. Just one question really around your value that is volume, you seem pretty clear over the last quarters, you’ve been once pivot the company more towards value maybe just value approach in the past.

In your statement today, you seem to indicate desire to increase the market activity to go for growth from 2022. So maybe just a few thoughts around value versus volume trade off.

Thank you.

I do not want us to shift to become very volume focused and that added a lot of programs and you should look at the market activity in the second half of last year. It wasn’t quite -- it was quite heavy activity going all the way from the iPhone launch over towards Christmas and lasting into January this year and now we're seeing less activity from say mid January throughout the first half of the year and I think it's only natural to expect that when we get back to the typical September-October activities at Christmas, there will probably be more activity that we'll have in the first half of the year and that to some extent the volume gain.

But I just want to be very, very clear, we believe that the launch in our suspect will grow than from a value focus, not from pushing volume, but it's important to relate to the fact that we're operating in a market that we're looking at what happens around us. We've taken a lot of responsibility by being very strategic and it's our ambition to do so if the market permits.

Thank you very much and good morning, gentlemen. Kjell, the question on convergence, you seem very confident that you can drive convergence going forward and claiming to a high degree than it's the indication in the past and you're also stressing that you're adding some new competencies with SoC convergence.

I understand that you’ve moved towards one single banner, but what makes you so confident and what will make the big difference in your convergence efforts going forward? What is it that will be done differently?

Can you enlighten a bit on why this will certainly, why will you see a step change in convergence and contribution from that, that will be appreciated thank you? And if I can sneak in the technical question might be a quick one Mikael, for how long should we assume that the increments amortization of the company brand will continue this, thanks?

Of course there will always outer and outer customer base with people who want to have a clean mobile-only product or another straightforward relationship to us and we will cater for that, but we think that one of the best way to bring value to us as a company and also to our customer base is to have a better convergence solution. Sam and I starter that work.

He has actually worked together with Henry on defining our strategy. As a leasing guide, they have done it together.

So there will be the continuity I think is very good. We have unique assets.

There are two players in this market that really have the full suite of convergent assets and that gives us the opportunity to have a bit of the uniqueness compared to the two other players in the market when we talked about that multiple tax. So it's about utilizing the assets we have, making sure that 1.3 million customer group that we address within our own base to get the best possible offering and that was a bit of harsh from first round of players who would naturally and more of a mobile-only approach and that's what is the right thing for them to do.

We have more -- we can go for different segments, we are very suited for catering for and Mikael, you answer the third one.

I can do it. It was our type of a tenure.

So this is the new run rate level you will see going forward of amortization, depreciation.

It was just a quick one from [indiscernible] actually on the Telia pricing including content in your limited mobile package. Is there some additional opportunity for you do you think.

It's quite high price offering by adding content and is there an opportunity for you to undercut X content or do you think the Swedish consumers are starting to require more content in their top end mobile packages and maybe that's something you have to work on particularly with coming [ph]? And do you mind if I just a clarification as well on the infrastructure comments you’ve made as well.

There's nothing outside the Baltics in there, so should we conclude now that you're still doing the work or do you finish the work and you have the Swedish infrastructure and maybe it's just more organic stuff with Telenor but nothing more than that. Thank you.

If I start then on the first question, I mean including content in top tier, I don’t think it's a must. So we don't have to do it but to candor with.

So that's it. I think in general, we talk about the value-led strategy and talk about the value-led strategy and this is a proof point of that driving the market in the right direction and of course that's an opportunity for us.

In general I don't think we have to grab that opportunity by including content everywhere though.

And on the infrastructure side, I think I would say that we were still working on that and it has to do with I am sure you know very well how the structure is on the 3G market in Sweden with us and Tele2 now then of course Telenor. So what I am trying with this thing distributing, shutting off the natural mobility, so with taking it one step at a time, I know it's very fashionable to move far from these things but without [ph] and how we'll make sure we do this in the right sequence and if we do something more around this and it will be very well brought through, but we are super pragmatic about how we consider our value chain.

Yes hello. CapEx question.

It's a lot of talk about 5G CapEx, but you're also investing in Remote5. How much will you invest in this?

And can you talk about what the improvements in the cable network that we can expect from this, in terms of the improvement in speed and capacity and if this investment in Remote 5also supporting your 5G plans in any way? Thank you.

Yeah, there are several things there. First of all, I mean, the conflicts is distributed all in of course, building the 5G it's on the Remote5.

And then Sweden is a little bit unique in that, it has quite –quite a lot of people who worked, sort of with their own company and selling consultancy services. So that is also part of our, of our CapEx.

So, it's divided into different areas. The remote 5 investment is clearly to support both our business with the reliability and speed and for our roll out business.

So it's basically, we used to say before we talk about bringing front foot to the customer in terms of build, I saw that you're building fiber closer and closer and closer to do base stations. This is what we're doing, building the fiber closer and closer to the customer living in a building.

So it does in house to the speeds, if you remember, I thought we kept the market as they started talking about that, the 10 G. So it's, there's always another G so on the capital markets that he presented, this, that's also available on our website to go through a, more of a presentation of what is said there.

I don't know. Do you want to say something more about the CapEx Mikael or?

I think we can if it talks about that the CapEx level, I think it's important to remember that this is an investment, which will be ongoing for many years, five plus years. So if you spread it out over these years, the, the, the number per year is not that significant compared to the five-year rollout.

And also bear in mind that this replace we used to do with notes speaking in the past to cater for building capacity. And this is the new way of building capacity.

So it replaces other Catholics, which -- which we used to do before. So it's not just Adam, I think that's important to remember.

And maybe just from a customer perspective, this will generate market-leading symmetrical space for, for broadband. So that's of course important to underpin the journey we're doing on convergence and quality.

Okay. Thank you.

Thank you very much.

Yeah, thanks very much. You had a very strong Q1 result as well.

And at the time you were sort of a bit cautious to re-drive into the, to the fully you talked about the commercial investments you want to make. Now the second quarter, again, you sort of, haven't quite dipped into that commercial investment.

I think that's part of the surprise versus market expectations. Could you sort of just get a bit more into, into can be more color, what elements of the development of the second quarter really gave you the confidence now to, to raise the, the full-year guidance?

But I think the efficiency program, whether it's the market environment or what are the actual numbers that are coming out of the business that would be helpful? Thank you.

Yeah, Well I think the thought by being, maybe it's not a hundred percent serious as it is easier to earn yourself into becoming a millionaire or billionaire to save yourself into. So I think at some point the focus needs to go back to getting a modest amount of, of growth.

And I think that time already has come for us. We are starting --we have started that shift and through to build long-term value, We need to have a focus on growth.

We will continue to be an efficient operator, but if we focus only on savings that's not going to build a really long, a good long-term story. I wouldn't say that there's one specific thing that causes us to, to adjust the guidance.

I think it's several things coming together. I talked about B2B need to be willing to use driving off performance.

It is not a huge driver of performance anymore. We can still improve and we will improve.

It's super important that the consolidated team has brought us back to growth in B2C in Sweden. So we clearly see that this is sustainable.

And that is something we can build upon. And then of course, we have exceptional growth in the Baltics, we think that will continue to grow.

But that growth will of course come down. At some point, we cannot have strong double-digit growth there forever.

And we all understand that. So it's a confidence that is building quarter-by-quarter as we see that we are more precise in our strategy that we have presented our segmentation, we start seeing that the market responds to our strategic pricing in the Swedish markets and our ability to deliver our services is improving as we go through an improvement journey.

So it's several factors that come together and make us feel more confident plus the fact that we’re more confident that at least for Western Europe and that, we probably will get after this pandemic this year in a reasonable way, although the rest of the world still has a big problem.

Thank you very much. Thank you.

Hi, thank you for taking my question. I would like to ask about the new appointments that you've announced in particular, about the Chief Commercial appointment as it's quite a sensitive position, so it’s hard to correct.

So first of all, can you confirm that that will be roughly one month overlap as both field kind of are together as opposed to in August, which could improve somehow the succession process? And secondly, can you just give a bit of a background as to what led you to choose Henry and what experience specifically makes them the right person for everything that's currently going through commercially?

And then if I may just also think in a clarification on the amortization of the Com Hem brand, does that or does that not carry a tax shield? Thank you.

Yes, so that's very good news Henry comes along here already in August, that allows for an overlap, because in real life that overlap has already started because Samuel and Henry to help him with challenging, so our strategy works. For the guys, I've actually had a dialog around the B2C strategy for some time.

And that is a huge strength for us. So that's when Henry comes here, he can hit the ground running.

And Samuel is an extremely loyal person. So he will be helpful until the last day the way I know him.

So this, you couldn't ask for a better transition than what we were seeing here and the team have already been introduced to Henry, his background, he has a lot of experience with FMC, but he also knows the TV business, the cable TV business from his partner. And when you look around at candidates for these types of jobs, you either often find a typical technical CMO which some of them are fantastic or you find someone who's working in cable TV and doing a great job there.

But someone who has that experience from both in a broad way in a way like Samuel does here, not that many out there. So I think we've made a very, very solid choice here.

That's going to be helpful for us. And then you asked something about again, the amortization of Com Hem but I think Mikael also does that, it's going to be done over 10 years.

That was not the question.

And I can clarify that there is no paid tax effect on this. But of course, there is a deferred tax booked on the amortization.

Marcus and Patrick can give you the details of this and the numbers but no effect on paid tax.

Thank you very much.

Thank you. Thanks for taking my question.

Just a quick question on the revenue improvement drivers in Q2, please. And this one on TV where you mentioned that with sort of Premium Sports coming back do you see return to stronger levels.

My question just was is Q2 a sort of normalized run rate or should we expect more improvement as some of those elements returning to the second half and then just related to that on the solutions revenues, just wanted to check if there was some sort of catch-up effect from previous quarters and although we should expect this to be the kind of run rate for solutions revenues going forward? Thank you.

So if I start with the TV question, and as I said, we will have some headwind on comparisons for Premium both in Q2 and Q3, and I think it's more or less evenly divided, if you compare to last year. But if you skip that, we also see an underlying improvement within both the former Com Hem TV part and also some in Boxer and that we expect to continue with the strategy we presented at the customer site.

And you are addressing the Solutions business, yes there is some effect on that, you have very well spotted. But it's not so big that that changes the overall picture.

So I’m very happy with the way Stefan is stabilizing that business and moving it back towards hopefully growth.

Got it, that’s very helpful. Thank you.

Hello, thank you for taking my questions. And just the first question, I want to ask about the price increase potential.

In this quarter, we're seeing that announced one of the biggest fiber price increases over the past few years. Just wondering, how do you think the potential price increases and ARPU growth, fixed broadband going forward.

I think broadband ARPU growth is now 1% to 2%. Do you think there's potential to go back to the 3% to 4% as we saw in the past?

And the second question, just a quick follow-up on your management team, would you mind to remind us how many key management seats that you still plan to fill and should we expect a more stable top management structure going forward? Thank you very much.

If I start with pricing and then I want to come back to our strategy and the way we do pricing, I mean we have a very clear, as you know value led strategy, we have a clear process on how we work, where we do focus a lot on adding value, working with the front book in the second half of the year and then in the first half of the year, we do the back book. And we're just now coming out of the back book exercise.

And now we're starting to look forward into kind of the next part of the cycle of adding value on the front book. And when we do that, we'll look at two things, if you want to simplify, one is of course that what's happening in the market and what kind of potential that that brings.

And the other thing we're looking at is our own ability to provide value to our customers. And with other players in the market working the same way and working with the value of that approach.

That of course, plays into our decision materials. So on the question, do we see continued pricing potential?

The answer is definitely yes. But I'm not going to go into exactly the percentage points of that.

But we do see potential and that is definitely part of the strategy going forward.

And your question and observation, of course around the management team and the changes in of course, absolutely spot on. I think we should take a little bit of a historic look at this.

Tele2 and Com Hem came together and some people are part of this management team have been around for a long, long time. We're talking about the Samuel’s case 14, 15 years.

We have had the -- use of Mikael has been CFO in different capacities now for a long, long time. So I think to some extent natural that when the first phase of his job is done, people who have spent a lot of time with a company and reached sort of the top level would like to just try to do something else with our lives.

I didn’t expected that situation myself, so I know exactly how that works. And now to your question, should we expect more stability?

Yes, you should expect more stability within the top management team. We are moving ahead.

Sharaf joins us in January. We have the interim solution with Peter.

Mikael is on board until the 1st September. So we have a team in place now that looks to the medium to longer-term.

And I think that that we have been able to put together a strong team and we can build on the strategy that has been developed partly actually with one or two other peoples, people coming in helping us, but with this team. And I can tell you when we have our management team meetings, we share a good love.

There's a good tone. It's just at some point when you've been around for a long time, you want to move on and try something new.

That's great color. Thank you very much.

Hi, thanks for taking my question. My first question is on operational side in mobile.

So for the past three quarters, you've had B2C postpaid mobile negative growth in net adds. However, your competition has been growing quite well in the postpaid net adds.

And I just wondering, why is that trend? And how are you seeing that going forward?

And then my second question, sorry, maybe I've missed heard your previous comments on infrastructure. Can you give an update on your thoughts on your towers in Sweden, and potential monetization of those assets going forward?

Thank you.

Yes, I can talk with that question. So I mean, if we look to this first half of the year, we know we have some challenges in the fourth quarter.

We were very open about that and talk about it, which has improved and done. I think we have taken a very big strategic responsibility being very clear on the value-led strategy, and also being a bit patient on that to make sure that, we get that piece moving in the right way.

We have the pandemic impact, which of course, has hampered volumes and we’ve done a lot of pricing in the first half year. So I would say all of this has been by our decision and the sign.

And now when we come out of the back book pricings I gave, we come out of the worst headwinds of the pandemic. We naturally see that there is a potential to improve also the volume side.

So not a big worry on our part, rather decisions we have taken on how we want to structure this business going forward.

Yes, I fully agree with what Samuel saying. I think it was important for us to show exactly how we operate and want to operate and how we want to set the tone in the market.

But we are not going to sit and watch, of course volumes going against us over time. But I think the learning we've had now is that it has been a worthwhile exercise that has given good results.

And back to infrastructure again. Yes, I think it's fair to ask and I -- when I came in there, I started talking a bit earlier about infrastructure.

So maybe, I upgraded full expectations with you. The reality of it is we are finding the rest of the 3G networks.

We are dividing the towers between ourselves, what we're going to bring from Sunab into the 5G network Net4Mobility. And of course, we have improved the relationship with our partner Telenor in Net4Mobility.

And -- but we are taking ourselves, we’re taking the time we need to do the proper analysis. So maybe I created expectations are all timing at an early stage when I was here, that that leads to you thinking that we should have announced something at this stage.

I can only say that we are entirely pragmatical -- pragmatic about how we structure our value chain, but it's too early for us to conclude and communicate.

Great. Thank you.

That's very helpful.

Thank you very much. I was wondering as we fully annualize the impact of the COVID-19 pandemic on the business this quarter.

Could we get your thoughts on the bad debt provision taking last year and how you're thinking about the outlook for your customer bases maybe some of the restrictions look to be lifted, is that's your outlook? And then secondly, sorry to come back to this Com Hem brand amortization.

But what's the reason for a 10-year lifetime when you're bringing two brands together that seems like quite a long time to me. So I appreciate a little bit more detail there?

Thank you.

I'll start and I'll hand over to Mikael I think. Please remember that even though we've done this merger, the Com Hem brand is still with us.

It's in our logo still partly, but of course, you have to have been a Com Hem customer for some time to see that. And secondly, we have a Com Hem Play Plus, so Com Hem is still a part of Tele2 and this is the best way we have an offer together with the officers for doing this.

Before we didn’t depreciate that also. It is quite well analyzed approach to it.

I don’t know Mikael, if you want to add something to it.

No I think you put it very well. It's still in the log book and you have certain attributes still used in the to your service for example, ads on and motivates 10 year depreciation time.

I can then add on the bad debt provisions to remind your all it was SEK35million which we provided for in Q1 last year and we have before this will we have not seen any material bad debt to them coming up over the last quarters and that I think the situation is very stable overall. This provision will be released over time but it's again SEK35 million in this group is not really material.

So it will not be visible in the numbers and this is part of the continuous reassessment we do of the bad debt provision every quarter, every month in every country.

I'd like to thank you all for taking the time to join us today to getting through our presentation and to discuss with us the quarter and our guidance and where we are today. I am very happy that we delivered a strong quarter that we are able to lift our guidance a bit and of course that we also have been able to see quarter ended to pay out the extraordinary dividend.

So I think we are on track, I think there will always be a lot of work to do and we are continuing with our transformation program and we're continuing building the premium position for Tele2. So we'll have lots of interesting stuff to speak over the next quarters.

Thank you for joining us today and have a very nice day.