Earnings call transcript: Cellnex Telecom Q2 2025 shows strong growth and strategic focus

Cellnex Telecom reported its Q2 2025 earnings, highlighting strong financial growth and strategic initiatives. The company achieved a 6% organic revenue growth, reaching 1.958 billion euros, and an 8.1% growth in EBITDA after leases. Despite these positive results, Cellnex’s stock price saw a decline of 2.6%, closing at 28.12 euros, potentially reflecting broader market conditions or investor expectations.

Key Takeaways

• Cellnex reported a 6% organic growth in revenues and 8.1% growth in EBITDA after leases.
• The company completed an 800 million euro share buyback program.
• Cellnex has a strong cash position of approximately 1.6 billion euros.
• The company reaffirmed its financial targets for 2025.
• The stock price decreased by 2.6%, closing at 28.12 euros.

Company Performance

Cellnex Telecom demonstrated robust performance in Q2 2025, with significant growth in both revenue and EBITDA. The company’s strategic focus on expanding its infrastructure and enhancing its service offerings has contributed to these results. Cellnex’s position as a market leader in the European telecom infrastructure sector remains strong, with over 26,000 Points of Presence (POPs) in France alone.

Financial Highlights

• Revenue: 1.958 billion euros, a 6% organic growth.
• EBITDA after leases: 1.163 billion euros, an 8.1% organic growth.
• Recurrent levered free cash flow per share increased by 10.2%.
• Completed an 800 million euro share buyback program.
• Strong cash position of approximately 1.6 billion euros.

Outlook & Guidance

Cellnex reaffirmed its financial targets for 2025, maintaining a commitment to investment-grade status and targeting a leverage ratio of 5-6x. The company plans to continue its shareholder remuneration program with an 800 million euro target for 2026. Positive ratings from S&P, upgraded to positive, reflect confidence in Cellnex’s financial discipline and strategic direction.

Executive Commentary

• Marco Patuano, CEO, emphasized the company’s focus on profitable growth and sustainability: "We are successfully delivering on our push for more profitable growth. Sustainability is not just a pillar of our strategy; it is embedded in how we operate."
• Raimon Trias, CFO, reiterated the company’s financial discipline: "We remain committed to our financial discipline."

Risks and Challenges

• Market consolidation in France could impact competitive dynamics.
• The European 5G deployment is lagging, possibly affecting growth opportunities.
• Regulatory changes, while becoming more favorable, could still pose challenges.
• The focus on network sharing may require significant infrastructure investments.
• Potential asset sales and tower adaptation for multi-tenancy could affect operations.

Q&A

During the earnings call, analysts inquired about market consolidation in France and strategies for secondary tenant contracts. Cellnex addressed potential challenges in tower adaptation and multi-tenancy, providing insights into its strategic approach to asset sales and market positioning.

Full transcript - Cellnex Telecom (CLNX) Q2 2025:

Speaker 6: Hello.

Maria Carrapato, Head of Investor Relations, Cellnex: Good morning everyone. Welcome to our first half 2025 results conference call. I’m Maria Carrapato, Head of Investor Relations, and I’d like to thank you for joining us today. I have our CEO Marco Patuano and our CFO Raimon Trias on the call. We’ll go through a brief summary of our results and then we’ll be open to take your questions after the presentation as usual. If you’d like to ask a question afterwards, please press your button on your screen and raise your hand. Okay, without further ado, over to Marco.

Marco Patuano, CEO, Cellnex: Thank you. Thank you, Maria. Good morning everyone and thank you so much for your time. I’m delighted to start with the key highlights of the first half of the year, which continues to be marked by consistent execution with solid performance across all the key metrics, reflecting our commitment with our objectives. As a reminder, the numbers we are reporting today are impacted by our change of perimeter due to the sale of our business in Ireland and Austria. There is no contribution from Austria for 2025 and Ireland only contributed for the first two months. On a comparable pro forma basis, we achieved a strong growth in the semester with revenues reaching €1.958 million and representing an organic growth of 6% and our EBITDA after leases reaching €1.163 million, implying organic growth of 8.1%. Our recurrent levered free cash flow per share improved by 10.2%.

We are successfully delivering on our push for more profitable growth with significant improvement in efficiencies, which Raimon will give you more color on shortly. In terms of operational developments, we’re excited to announce the renewal of our agreement with Odido in the Netherlands. The milestone reinforces Cellnex’s long-term industrial alliance with its clients, securing the associated revenues for an additional 15 years. It reinforces our commitment to delivering reliable, sustainable infrastructure solutions that support innovation and growth across the sector. Continuing our effort, we have extended our infrastructure agreement with Telefónica to support the rollout of up to 3,000 RAN sharing Digi POPs. This strengthens our partnership and reinforces our role in enabling fast, efficient network expansion. From a capital structure standpoint, we have issued a 7-year €750 million bond with a 3.5% coupon.

Additionally, we refinanced our €2.8 billion syndicated credit facility, ensuring our ability to meet future maturities and liquidity needs. I’m pleased to share with you another important development announced yesterday by S&P. S&P’s threshold for Cellnex investment grade rating has become more tolerant, allowing us to have a higher debt ratio whilst maintaining the same rating. As a consequence, Cellnex has been upgraded to positive outlook. This gives us materially more financial flexibility. As of today, we have not taken any decision as to how this additional flexibility could impact our capital allocation strategy. This will also be conditional upon agreeing a comparable level of flexibility with Fitch. During the second quarter, we successfully completed our share buyback program, a key initiative aligned with our capital allocation strategy. We acquired 24,064,404 own shares representing 3.41% of the share capital at an average price of €33.24 per share.

These decisive movements reflect our confidence in the long-term value of the company and demonstrate our commitment to enhancing shareholder remuneration. Moreover, this action reinforces our disciplined financial strategy and capital structure optimization while maintaining flexibility to invest in growth and value-creative opportunities. In summary, we believe our journey to date has been marked by the definition of a clear roadmap towards profitable growth, solid commercial, operational, and financial performance, strong governance, and consistent and disciplined execution. Looking ahead, we are confident in reiterating our guidance and in our ability to deliver on our key strategic targets. Moving to slide 5, let me start by reinforcing the foundation of our industrial value proposition, one that is clearly focused on maximizing long-term value for our shareholders while positioning Cellnex Telecom as a trusted partner for our clients. Our business model remains underpinned by strong fundamentals and robust free cash flow visibility.

First, let me start from the strength of our MSAs. We have very long-term contracts in place with watertight all-or-nothing renewal mechanisms, CPI-linked escalators, and very limited churn concessions. More importantly, they provide predictability of future cash flows with anchor tenants securing the vast majority, being approximately 70% of our revenues. The strength of this contractual framework has been proven over and over again, and more recently through renewals with major operators like Wind Italy following its merger with Hutchison, with the renewal of Telefónica in Spain, with the Vodafone and Hutchison merger in the UK, and with the MasOrange case in Spain. I would also like to stress that we have other very important renewals for several of our secondary tenant contracts, for VMO2 in the UK, the so-called VIRUS agreement. Sorry, I had a moment of blackout in the communication. Is it fine? Yes.

Raimon Trias, CFO, Cellnex: Okay.

Marco Patuano, CEO, Cellnex: Vodafone VMO2 in the UK, the so-called agreement Farus, Iliad in France, we extended extra 10 years. Orange in France, we extended the secondary contract for another 12 years. Not only are we demonstrating that our anchor contracts are rock solid, but also the second tenant agreements in our largest markets are also long term and robust. With these renewals, and framed by the importance of our industrial partnership and spirit of constructive collaboration with our customer in each market, we have successfully increased the maturity and scope of service, preserving the underlying value of our contracts. I would also like to stress that we have only one renewal coming up for 2030, the terms of which have been already agreed, and no other major renewals until 2035. We have an important role as a key technological enabler.

Our infrastructure enables the efficient use of spectrum, a scarce and highly valuable resource. We operate in a sector with very high investment requirements, and our specialized operation of passive telecom infrastructure allows our customers to focus on their operations. In particular, Europe continues to lag in 5G deployment and general network investment against a regulatory backdrop that appears more favorable to the existence of financially stronger operators capable of supporting the level of investment required to be globally competitive, and we are strategically well positioned partner in the creation of that healthier telecom ecosystem, providing operators a neutral platform to develop the coverage, the capacity, and the reliability of their network with the most rational use of resources. A key example is the UK, where the regulator did not oppose the Vodafone 3 merger. However, it did impose significant additional investment in network improvement.

We also played a key role as enabler of new market designs. As an example, we made possible for Digi to enter the Portuguese market, providing around 4,000 colocation in a record of 18 months after Digi was awarded spectrum in Spain. We also enabled their expansion via network sharing agreement on telephonic equipment and the launch of Iliad in Italy via combination of network sharing with Wind and the building of dedicated infrastructure. To complete the picture on long term value orientation, as of today we have contracted backlog of over €100 billion, supporting very high free cash flow visibility. Concerns have been raised recently about our capacity to protect our revenues when we renew our contract. I stress that as of today all, and I underline, all of our anchor agreements have been renewed maintaining the original MSA prices. The Odido renewal announcement confirmed this thesis once again.

Even more importantly, since it involves both the anchor and the secondary component of our business relation. We are also expanding the scope of our partnership as telecom infrastructure plays an increasingly central role in European digital defense and energy strategy. Beyond connectivity, we are actively investing in adjacent opportunities such as smart IoT solutions, critical communication networks, towers used for drones, battery storage systems, and many more. We are also complementing the active network of our clients every time that a neutral host solution is more convenient and more feasible than an MNO proprietary network. I refer to DAS and small cells, a growing market of specialized coverage, for instance stadiums, malls, hospital offices, city centers with urban restriction and others in which we do not compete with our clients. We offer turnkey solutions to MNO and business users.

All of this is guided by a disciplined governance framework and a leadership team committed to long-term value creation. In short, Cellnex continues to deliver resilient performance focused on profitable growth, backed by very high quality and robust contracts, an industrial relationship with our clients, a strategically well-positioned asset base, a transparent and disciplined governance structure, and a clear strategy to deliver sustainable value for our shareholders. We are conscious that rumors on consolidation in the French market and potential impact on us have been the cause for much speculation, much more than needed, and as such I would like to give you some objective data points that will help you to understand the context. Cellnex is strongly positioned to navigate any potential market consolidation. In France, we operate over 26,000 POPS sites and 31,000 POPS generating €725 million in tower revenues.

Our business is underpinned by long-term MSAs with SFR, Bouygues Telecom, and Iliad as anchor tenants, with the first renewal programmed for only 2037, and Orange as a secondary tenant running until 2037-2045 with fixed escalator 1.2% ensuring stable and predictable revenues. Importantly, all of our secondary tenant contracts have already been renewed for between 10 and 12 years. At the end of 2024 we also renewed a non-anchor contract with Iliad Free Mobile for circa 1,700 colocation of Ivory towers. The length of the MSA is 10 years and we have an individual contract for another 12 years. France is leader in RAN sharing with two major frameworks. The Crozon agreement between SFR and Bouygues, a 20-year-long deal covering around 65% of the population.

In the case of Ivory, approximately 11,000 POPs, more than 50% are in RAN sharing and the so-called New Deal Mobile, a government-led initiative involving all the MNOs to expand 4G 5G in rural areas. In these RAN sharing areas, roughly 2/3 of the country networks are already being deployed efficiently with minimal impact from any potential consolidation scenarios. The remaining area, the so-called dense area, are those where the impact of consolidation should be analyzed. They represent, roughly speaking, a third of the country and we have between 40% and 50% of our POPs. When looking at the various consolidation combinations between MNOs it is important to take into account that on one hand the physical overlap between the sites and on the other hand the automatic increase in subscriber and data traffic after a potential combination.

Basically, the operational ability to cancel site post combination is lower than the pure contractual terms. On MSAs, which account for 90% of the tower revenues, include all-or-nothing clauses, a churn rate is allowed below 1% and secondary tenants, approximately 4,700, contribute less than 10% of the revenues and have been already renewed for 10 to 12 years. Finally, as seen in other markets like the UK, post Vodafone 3 combination often led to increased network investment, a trend that would further reinforce Cellnex Telecom’s role as a neutral long-term infrastructure partner, a factor that also results as a positive from the potential consolidation in France. In the resulting improved credit rating of large client depending on the final outcome and how the assets are distributed among the other operator, Altice’s fragile financial situation today will no longer pollute market dynamic and credit risk profile will improve.

All these elements make us an unavoidable and strategically critical party in any potential market consolidation talks. Our contracts with SFR cannot be transferred in part without our consent, and as we did in the past, we are going to give our consent, swapping some collocation flexibility for the guarantee by the new tenant that the entire portfolio assigned will be duly priced and maintained for a longer period. We have thus far demonstrated in Spain and in the UK recent market consolidation that we are available to support the development of a healthier MNO ecosystem, introducing some short-term operational benefit while safeguarding and even potentially growing the value of our long-term agreements, also standing to reap benefits from potential optimization that result from MNO consolidation.

Therefore, in terms of the current environment, we support the favorable regulatory tailwinds around MNO consolidation in Europe if they favor behavioral remedies, namely investment to improve network quality and densification in opposition to structural remedies of the previous years. Adding all up, we believe that the impact of potential consolidation scenario in France is limited with potential upside. Move to slide seven, further reinforcing the health of our strategic long-term partnership in different markets across Europe and our continued efforts to enhance network infrastructure. I am pleased to share with you two key renewal agreements. From July 1, Digi in Spain started to use the spectrum it acquired as a remedy taker of the MasOrange merger. Within this context, Digi and Telefónica formalized a long-term network agreement. Over the next 16 years, Telefónica will provide Digi with both RAN sharing services and roaming on its network.

To support this transition and to enhance the overall network, Cellnex and Telefónica have extended their infrastructure agreement. We will deploy 110 additional physical points of presence by Telefónica, significantly boosting their network densification, and we will activate up to 3,000 RAN sharing Digi POPs over the next years. This effort will not only increase Digi network capabilities, but also reinforce our leadership position in infrastructure sharing and efficient network development. In the Netherlands, we renewed key infrastructure agreements with Odido, strengthening Cellnex’s position as a key partner to enable high-quality connectivity and digital transformation across the country. Our contract is renewed for 15 years. It is CPI-linked and maintains the revenues of our original agreement, ensuring long-term cash flow, stability, and predictability.

Together, these agreements are a testament to our strategic approach to the collaborative relationship we have with our customers and focusing on long-term value creation, operational excellence, and enabling our partners to thrive in an increasingly connected world. My last chart is on ESG. Turning to our ESG progress, this is an area where we continue to lead with purpose and measurable impact. Sustainability is not just a pillar of our strategy, it is embedded in how we operate, how we grow, how we create value for the long term. I would like to highlight a relevant milestone in our decarbonization strategy this quarter. Having achieved the ISO 50001 certification for 80% of our energy use, our efforts in responsible leadership continue to earn us global independent recognition, renewing best-in-class positions in the major ESG rankings and standing out at the forefront of the most sustainable companies in the world.

Raimon, I drink a glass of water and I leave to you the floor to you. It has been a bit longer than in the past, but I think that the MNO consolidation deserved a bit more space. I hope I made clarity, but of course I assume that more questions will come afterwards. Raimon, the floor is yours.

Raimon Trias, CFO, Cellnex: Thank you, Marco. Good morning, everyone. I will now run through some of the main financial and operating metrics we are reporting for the period. Let me start reminding you, as Marco did, that our numbers this first half 2025 are impacted by the change of perimeter as we have no contribution from Austria in the year 2025 and Ireland only contributed within two months. This table gives you a clear comparison as where we are removing this effect from our numbers and highlighting the organic growth derived from our performance. As you can see, we continue delivering strong operating leverage. Revenues grew 6%, our EBITDA 7.3%, the EBITDA 8%, and our recurrent levered free cash flow per share 10%.

Let me remind you as well that our recurrent levered free cash flow per share has improved not only as a result of the improvement of the recurrent levered free cash flow, but also as a result of the share buyback we undertook during the first half of the year when we bought 24 million shares. Moving to our financial performance on Slide 11, as I mentioned, our revenues increased 6% on organic basis and the adjusted EBITDA by 7.3% compared to the same period last year. This growth has been driven by the four business lines we operate and in particular by the towers and the fiber connectivity and housing services. Our EBITDA increased 8.1% on the same basis, highlighting further growth in operating leverage and enhanced profitability. As we will mention later, we have accelerated significantly versus last year the land efficiency program, helping us improve the EBITDA.

In terms of cash flow generation, our recurrent levered free cash flow amounted to €332 million, with growth set to accelerate throughout the year thanks to the normalization of cash items below. As I will explain later in more detail, as I said, the recurrent levered free cash flow per share has improved 10% on the year as well. Moving to our key operational metrics, we have added 2,233 sites in the context of our build-to-suit programs, mainly in France and Poland. Our net allocations in the first six months reached 578, impacted by the 974 withdrawals from MasOrange in Spain. As you know, negotiated in the context of the merger, collocations have been well balanced by country, improving our tenancy rate to almost 1.6, 1.59.

As regards to our investments in efficiency to optimize our asset base and drive operational efficiency, we have undertaken a combination of land site actions, acquisition, upfront payments, contract renegotiations totaling €115 million in the first half 2025. This compares to the €93 million we did last year, so there has been an increase of 23.7% that reflects the increased focus on land efficiency after the creation of Finland. Moving to Slide 12, the first half of 2025 has seen another period of consistent commercial performance with POPs growing 4% compared to the same period last year. This is explained by the net colocations contributing 1.5%. It would be 1.8% if we were to exclude the impact of the majority in Spain.

As a reminder, the new contract signed with MasOrange in Spain gives our client network flexibility in the short term in exchange for a single longer contract until 2048 and additional services to be provided by Cellnex. As per this agreement, no impact in revenues is expected until 2026 despite the churn seen in terms of POPs this year. Nevertheless, the impact expected for 2026 onwards will be compensated by new business. As discussed by Marco Patuano before regarding consolidation, it is another example of how we have been managing the various consolidation cases to date without a long-term impact to Cellnex and the value of our contracts. Moving to the next slide, we maintain strong organic growth at 6% year on year.

As you will know, this is due to various factors like the price escalator and CPI from our contracts, the colocation we’re undertaking on the existing sites, and the new build-to-suit that we are building mainly in Poland. To provide a clearer picture of our performance in the period excluding the impact on the change of perimeter, on this slide we are providing our organic revenue bridge on a pro forma basis. Let’s look at the data by business line. As you can see on Slide 14, our tower business represents 80% of our total revenues and is growing organically at 5.2% driven by escalators and CPI, colocations, and build-to-suit. As of June 30, all price increases from the contracts have already been applied to all our customers in the year and we have excluded for comparison purposes Austria and Ireland from the 2024 base.

Moving to the next slide, we can see comparable performance of our other business lines which continue to show healthy organic growth in fiber connectivity and housing services. Revenues grew by over 20% year on year. A key contributor to this performance is the Nextlook project in France, which exemplifies our ability to deliver advanced fiber infrastructure tailored to high-density and high-demand settings. Thus, small cells and RAN show growth of around 2.8% by densifying networks and enhancing indoor coverage. What’s driving this performance is the growing demand for smart infrastructure connectivity, particularly in high-traffic environments like stadiums such as Etihad Stadium and Riyadh Air, Metropolitano transport such as the Metro, associated Gran Baris, airports such as Milan Malpensa and Milan Linate, and hospitals such as Bergamo. These deployments demonstrate our ability and technical expertise to adapt and deliver value in mission-critical scenarios.

We could also add to this list Metrohol, our joint venture within the Metro de Madrid, which operates the DAS service for the MNOs in Madrid underground. Now developing the 5G update in broadcasting, revenues increased by 2%. This cost-efficient business line, operating mainly in Spain and the Netherlands, continues to generate strong cash flow and offers long-term visibility thanks to its mature and stable structure. If you move to slide 16, we keep improving all our cost drivers to drive efficiency as part of the strategy set out on our Capital Markets Day and our continued focus on industrial excellence. Our main efficiency ambitions relate to asset rationalization, cost-based optimization, and group-wide productivity. Again, considering performance numbers, the reduction in headcount is part of our broader strategy to optimize resource allocation, enhance productivity, and focus on core activities.

In June, it took place the first phase of the recently announced redundancy program in Spain, which is implemented over the 2025-2027 period. This plan will also result in discontinuing certain operational maintenance contracts which have a nil or negative EBITDA contribution in repair maintenance costs. Following the positive performance last year, we continue to see good progress in the period, representing a 1.6% decrease per tower and the evolution of our general expenses translated into a 4.4% increase per tower. This trend reflects our continued focus on lean workflows and disciplined cost control. Finally, on leases we have been able to reduce costs by 1.1% per tower, reflecting good momentum on our land acquisition plan along with rent negotiation and cash advance initiatives, which are progressing well as discussed before. Now let’s take a look at our debt maturity profile on slide 15.

Be aware that this page is updated as of today, not 30th of June. All 2025 maturities have been either repaid or refinanced. As a result, there are no remaining maturities left in 2025 while we still remain with a strong cash position, circa €1.6 billion. Regarding our term management, during the first half of 2025 we have executed the following transactions. We secured a new €625 million syndicated term loan with a margin below 1% as communicated in our first quarter results. In May, we successfully completed a €750 million bond issuance, thanks to active interest rate management through the use of hedging instruments. The effective annual cost of this issuance was reduced by more than 10 basis points. The coupon of the bond is 3.5%. Finally, in July we refinanced our main syndicated credit facility, increasing its total amount from €2.5 billion to €2.8 billion.

Its refinancing not only extends the maturity to 2030, but also includes two one-year extension options, which could push the final maturity to July 2032. It has been supported by 26 financial institutions. This is essential for maintaining and strengthening Cellnex Telecom’s long-term liquidity position. We have a robust and well-structured capital framework. Liquidity remains strong with more than €4.7 billion of liquidity available, €1.6 billion held in cash in order to cover upcoming maturities. 78% of our debt is fixed rate, and short-term maturities have been proactively managed, with average maturity now standing at 4.5 years. Our average cost of debt of 2% is expected to increase only marginally in the next years.

As Marco Patuano mentioned at the beginning, S&P just revised their outlook to positive, reflecting the improvement we have been doing over the past two years on our capital structure, but also the stable and predictable cash flows and higher barriers of entry of the sector. Finally, on the last slide, we are confident in reiterating our 2025 outlook and all our public financial targets, reflecting the resilience of our business model and solid execution across all our markets. We now remain at your disposal to answer any questions you may have.

Marco Patuano, CEO, Cellnex: Thank you, Raimon. Thank you, Maria.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay, in terms of the lineup of questions, our first question comes from Andrew Lee from Goldman Sachs. Could I ask you to pronounce your questions clearly so that we can all understand them in the room?

Marco Patuano, CEO, Cellnex: Thank you, Andrew. Good morning.

Andrew Lee, Analyst, Goldman Sachs: Yeah, good morning everyone. I had two questions. Firstly, just on the balance sheet and cash allocation, and then just secondly, if you could give us an update on the Swiss and data center potential asset disposals. Where are we with those processes? On the first question on the balance sheet, you obviously mentioned the positive update from S&P. Just wondered if you could talk through with a bit more color how that has affected your thinking about your optimal gearing for now and how that thinking has evolved. I think you’ve talked about a five to six times kind of range of leverage that you’re comfortable with. Is that rising now? Any kind of color you could think on how you’re thinking about that would be really helpful.

Also, just secondly, in terms of acquisitions or potential capital allocation, is it still right to assume that it’s more likely you’ll be spending money on shareholder returns than M&A? Thank you.

Marco Patuano, CEO, Cellnex: Yes, Andrew, thank you very much for both the questions because I think it’s to the first two hot topic of the day. The update of the S&P has been a long, long, long discussion we have been having with the rating agencies. Meaning that the strength of our balance sheet and the predictability of our cash flow is really remarkable. If you add the industrial, our industrial position, the differentiation of the portfolio, if you put all in the basket.

Raimon Trias, CFO, Cellnex: What.

Marco Patuano, CEO, Cellnex: You see is that we have more credit capacity than what was originally allowed. Now the conversation with S&P, I make the long story short, is de facto a rating improvement, but it has not been shared as of today by Fitch. We are having similar conversations with Fitch in order to understand where is the comfort zone of Fitch and therefore the entire work is not done. What is the takeaway? The takeaway is that our strategy and our discipline has been rewarded by the raters since point number one, we have more flexibility. Point number two, this flexibility has to be confirmed by Fitch. As of today we have the flexibility only from one of the two rating agencies and our view doesn’t change. It’s good to have more flexibility in the balance sheet.

As of today, we stay committed to our strategy, to our financial discipline and going forward with the Board of Directors, we will understand if and how to use this financial discipline, if and when agreed by both the rating agencies with reference to the asset rotation. To say the truth, we have very little to share with you. The potential transaction both in France and Switzerland are still on the desk of our M&A guys. We have as of now, nothing to share. We will provide you as usual update as soon as we have reliable information. Let me add a couple of points. We stated tens of times, but I will never be tired of saying again. We are very disciplined in our approach to the capital allocation and every decision we make are based to the maximization of the shareholder value.

What I mean is we are not forced to do anything. We have a solid capital structure, as I said, further reinforced yesterday by the upgrade of S&P. We have committed to a shareholder remuneration which is not based on further disposals. This is what we already said. We said that the original $500 million have to be read as a new level of $800 million. This is nothing new. Again, this is not based on any further asset disposal and as soon as we have more information, we will share with you.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay, moving on to the next question. It comes from Akhil Dattani from JPMorgan Chase.

Andrew Lee, Analyst, Goldman Sachs: Hi.

Morning.

Akhil Dattani, Analyst, JPMorgan Chase: I’ve got two questions as well, please. Firstly, Marco, as you said, a helpful slide on the French market structure and what’s going on. I had a couple of clarifications just to make sure that we’ve understood that slide properly. You’ve mentioned in the slides and in your comments that the variables that could be relevant would be the overlap between the anchor sites. I wondered if maybe you could just comment on what that is and the way you think about the relevance of that. You also mentioned offsetting the opportunity in the rural areas from once you have stronger players, potentially seeing more investments in that. Could you help us understand and quantify how you think about the scale of that, just so we understand the puts and takes in terms of how we think about that.

The second question was just around the asset sale process, and it’s a bit of a bigger picture question rather than specific to these assets. When we stand back and look at the industry as a whole today, it feels that the last few years, public markets had derated infrastructure assets, but private markets were still paying much richer multiples. This year, that seems to be eroding a bit. If I look in the fiber space, there’s not been that many transactions in towers. If you look in the fiber space, these multiples have come down. We saw earlier this week there was the French transaction on the infracos between WIG and SFR, and the implied multiple of that looks quite low as well.

Can you just help us understand, when you look at the buyers out there in the private equity world, do you think there is a bit of, let’s say, tension there in terms of just where they’ve been paying and what’s going on, or do you think that that’s something we shouldn’t read too much into? With that, did you look at infracos at all, or was that not enough that you cared for? Thanks a lot.

Marco Patuano, CEO, Cellnex: Good. Thank you for both your questions on the French case. You got perfectly the two points that I wanted to underline in the chart. If you allow me, I swap the order of the answer. I start from the rural. As of today, the rural coverage in France is a mix of RAN sharing and colocation. The number of duplicated towers, I mean duplicated towers for me is you have two sites, two infra, where, technically speaking, with a higher colocation rate, you can serve the population with only one tower. The number of duplicated assets is relatively limited. Why? It’s relatively limited because SFR and Bouygues Telecom are RAN sharing by design. Orange, after, let me say, the first phase of network deployment, started using colocation more and more. They have their Totem tower, but they started to use colocation more and more.

We have several thousands of colocation requests from Orange in rural areas. It’s a big market. As you know, France is more than 500,000 square kilometers. France is big. The more you go in the deep rural, the more you feel that, let me say, the voice coverage is okay, but the data coverage is not okay, so in the rural the possibility of a, let me say, network rationalization. I would say that the network is fairly rational as of today. Impact modest upside material. The problem of the upside is that the original build-to-suit criteria, so the one that was, let me say, an extension of an M&A transaction, is not actual any longer. If someone asks us to replicate the old build-to-suit agreement, the answer is that those agreements are not replicable anymore.

In the urban areas, I want to share with you, before talking how we see France, what we see happening in Spain and in England. It’s more moving the pieces on the chessboard than canceling. Why? Because in the dense urban areas, putting together two customer bases increases dramatically the capacity needs of a network. The risk is that you have the coverage, but you cannot access the network or you have such a crappy service. Sometime in London you have some examples that you see that the operator needs to do something. What we see in London, for example, is a super strong acceleration of.

Andrew Lee, Analyst, Goldman Sachs: The.

Marco Patuano, CEO, Cellnex: Densification by Vodafone 3. What we assume is on the one hand there are the contracts. The contracts allow my client to move a limited number, or sorry, to cancel a very limited number of pops. I know that my client needs more flexibility. I don’t want to impede the flexibility of the client as we did in Spain. We are favoring the flexibility, but with no financial impact. Not even limited, with no financial impact. I think that this is going to be the case also in France. The contract is designed in this way, the secondary. What has been super important, possibly our fault, we have not been loud enough in the past. We’ve been working a lot on the secondary contract. We renewed the secondary contract for 10, 12, 15 years. With Telefónica, we renewed a very long secondary contract. Very long.

I hope I gave you the answer. If not, please tell me and I can deep dive for another couple of hours on the asset sale. You are touching a very, very delicate point, which is the assets are basically the same assets. The point is, did something change in the infra fund environment? I would say that it has been tough for them to raise new funds. If you take super successful firms, they struggled to raise new funds and therefore in order to be more competitive, they need returns that are not the traditional infra returns. What is the expected return on capital of an infra? Three years ago it was a mid high single digit, it was something 7, 8% today. This return on capital is not there.

I don’t think that the problem is on the quality of the assets, on the quality of the cash flow, on the predictability of the cash flow. I think that the finger point on fragility on our business model possibly is a bit overestimating the downside risk. When I hear talking about 3, 4% risk, I think that this is too much. It is not about us. I think it’s more about the fundraising of the private market.

Akhil Dattani, Analyst, JPMorgan Chase: That’s super interesting. Marco, just on Infracos, was that an asset that you looked at as a company?

Marco Patuano, CEO, Cellnex: Sorry again.

Akhil Dattani, Analyst, JPMorgan Chase: The Infracos transaction that Bouygues and SFR announced this week, selling their towers, I just wondered if that was an asset that you looked at as a potential acquisition.

Marco Patuano, CEO, Cellnex: Oh, yeah, we’ve been looking to the asset. The problem is that in France I have a strict antitrust limitation, and then there are some specific elements that did not fit perfectly with us. We decided to exit from the process fairly quickly because it’s useless to spend the time and to use my resources on an asset that we were not interested in.

Andrew Lee, Analyst, Goldman Sachs: Great.

Akhil Dattani, Analyst, JPMorgan Chase: Thanks so much for the answers.

Marco Patuano, CEO, Cellnex: Thank you. Thank you, Kim.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay, so now moving on to the next question, it comes from Andre Kabatek at UBS.

Andrew Lee, Analyst, Goldman Sachs: Hi everyone, and thank you very much for the presentation and especially the more details that you gave us on France and other contracts. I’m just going to stick to the theme, if I may. You highlight the collocation renewals for Iliad and Orange. I’m just wondering what the collocation situation is with SFR and Bouygues Telecom.

Maria Carrapato, Head of Investor Relations, Cellnex: Andre, can I interrupt you? Could you maybe speak a little bit more slowly and clearly? It’s a bit difficult to hear you in the room.

Marco Patuano, CEO, Cellnex: The line is a little bit disturbed. If you speak a little bit slowly, yeah, better. Better than.

Andrew Lee, Analyst, Goldman Sachs: Okay, thank you. Apologies for that. I was wondering on the slide on France still, you are highlighting the renewals that you’ve done for Iliad and Orange. I’m just wondering what the collocation situation is for the agreements with SFR and Bouygues Telecom, because those are potentially even more important. If you can maybe expand a bit, how the average secondary tenancy looks like in other markets. I think maybe not many of us were aware that some of these contracts are actually this long or that you are renewing them at these lengths. If you could talk a bit more broadly about the general secondary contract landscape. The second question would be in relation to the deal that Akhil was talking about with Phoenix Power.

What kind of impact are you seeing, if any, on France and Italy specifically where Phoenix has done some deals and it’s becoming a bit more of a weight in terms of market share. Is this having maybe an adverse impact on pricing in these markets? Any color on that would be very helpful, thank you.

Marco Patuano, CEO, Cellnex: Okay, sorry, the communication was still, let’s say, mid quality. If I’ve not understood properly, please correct me and I will follow up. Co location in France was your first question. Colocation in France, we have to.

Raimon Trias, CFO, Cellnex: Split.

Marco Patuano, CEO, Cellnex: Two different concepts. One is collocation coming from RAN sharing. Collocation coming from RAN sharing is entirely SFR Bouygues. They have this network sharing called Crozone. It works in all the countries except the high dense area, and the contract for us is fairly protective because the contract clearly says that the fee remains unchanged in case the RAN sharing agreement is not active any longer. They want to integrate the network, so having a single network instead of RAN sharing, be my guest, it doesn’t change a penny of my revenues on the secondary tenant contract. Point number one, the three operators that have MSAs with us at the time of the portfolio acquisition signed very important build to suit agreements. As of today there is.

Raimon Trias, CFO, Cellnex: A.

Marco Patuano, CEO, Cellnex: Significant number of sites, individual sites tendency one with most of them. The second tenant is something that has been used particularly by Iliad and by Orange. Iliad and Orange have quite long contract. They are priced, let me say the price is a market price, let’s say approximately 50% of an anchor fee, more or less. We are talking about 3,000, 4,000 pops and excluding the RAN sharing. On top of the RAN sharing and we agreed with them two things. One is the extension of the duration of our contract. As always there is a modest respiration rate that is quite modest, well below 1% and we agreed on a 10 year, on a 10 year duration contract with CPI-linked escalators or the usual one, we have agreed with them. We have a pipe of further colocation requirements which depend mostly on permitting.

The bottleneck today is represented by the permission. On the pricing of the secondaries I think I gave you the answer if I understood. The second part of your question was again on the deal of the Corazon Tower, is it correct?

Raimon Trias, CFO, Cellnex: Yeah. Oh, we didn’t like the BDI.

Marco Patuano, CEO, Cellnex: Yeah. I think that the company who went for the—let me make one step back. The tower market in France is pretty fragmented. If you take the number of tower players, it’s Cellnex, Totem, Phoenix, TDF, American Tower, and there was Crozon. It’s way too fragmented. The fact that the tower market goes in the direction of consolidation is a net positive for the French tower market because you avoid having marginal operators who tend to act irrationally in order to get more scale. Tower business is a scale business. If you don’t get scale at the end, you do something to get the scale, which can be something not good for the market because you can start touching the prices in an irrational way.

Raimon Trias, CFO, Cellnex: So.

Marco Patuano, CEO, Cellnex: We have limitations in acquiring big portfolios. When we made the last acquisition, the antitrust gave us remedies that ended with the sale of several thousand towers, approximately 3,000 towers, which is the base of the Phoenix Tower portfolio. If you ask me, is 3,000 towers an optimal sizing for getting the scale? The answer is no. With 3,000 towers, you don’t get all the benefit of the scale. It’s absolutely natural that you have on one side a market too fragmented, on the other side someone with good funding capacity who wants to get more scale. I think that what happened is natural. The market goes towards a more consolidated tower market, which means a more rational tower market, which is good. It was a portfolio too big for us for entering without another nightmare of you buy 10 sites and you have to sell five.

My team in France has so many things to do that I don’t want them to be in this. I hope I, Andre, I answered your questions.

Andrew Lee, Analyst, Goldman Sachs: Thank you very much. Marco, if I may, maybe more directly on the SFR and Bouygues Telecom situation. Obviously, there are two MSAs, there is the network sharing prozone, but then what is the exposure to, say, less protected trade secondary tenancies, if any?

Marco Patuano, CEO, Cellnex: Yes, we have two MSAs, because we have two MSAs, one with SFR and one with WIG. The two MSAs on the RAN sharing component are cloning the close of one the other. Believe me, it’s even less than modest of a potential. If the consolidation is on, the network is big with the SFR. You open a bottle of champagne.

Andrew Lee, Analyst, Goldman Sachs: Okay, thank you very much.

Maria Carrapato, Head of Investor Relations, Cellnex: Thank you for your question. Moving on to the next question, it comes from Rohit Modi from Citi. Rohit, if I could ask, if you could also place your question clearly so that we can understand in the room.

Sure.

Rohit Modi, Analyst, Citi: Thank you. Maria, two questions from my side. One is a follow-up on the French consolidation. You mentioned about limited impact from the French consolidation. Does that mean that the limitation from, you know, the agreement, you’re ready to let go some of the revenue or that’s a combination of some of the revenue that is already at risk when consolidation happens as well as, you know, some of the revenue might let go from, you know, for a higher duration. Second question is around the capital structure. I understand you mentioned that, you know, it remains as it is. I’m just trying to understand what happens if Swiss sale and French tower sale doesn’t happen. You have a bandwidth from S&P, but you still need approval from Fitch. If Fitch doesn’t give approval, is there any change in terms of your shareholder returns for next year? Thank you.

Andrew Lee, Analyst, Goldman Sachs: Cool.

Marco Patuano, CEO, Cellnex: I leave it to the CFO, the capital structure. Because otherwise I don’t understand why you paid the salary and I take the one on the France. I always refer to limited impact when I speak about France. I would say that my base case is no impact. This is my base case. Why I’m so positive. Point number one, the quality of the contracts we have, same as we did in Spain. In Spain, we traded operational flexibility with two things: with revenue stability and contract duration. In France, to say the truth, contract duration contracts are fairly long, very long. We are well beyond 2040. I’m not particularly worried. What is important to me is that since the contracts are all-or-nothing, what we don’t want is the fragmentation of the contract. Do you want to split the contract? Okay.

It aggregates to an existing contract with a total all-or-nothing at the renewal date. Which means that before you had 11,000, 12,000. You buy a portfolio. Portfolio five. Fantastic. At the renewal, we will discuss about all-or-nothing of 16,000. This is the point. That is, by the way, what we discussed with MasOrange. It’s rational. It’s a win-win. My base case, Roshan, is that. Sorry, right, is that we have this. This case. I’m pretty confident. What is important is I think that everybody understands that you cannot discuss about in-market consolidation without having at the table such an important player as Cellnex, who is a partner of choice of 3 out of 4 of the players in the country. This is where we stand, Raimon.

Raimon Trias, CFO, Cellnex: On the capital structure. Rohit, if you recall when we had our Capital Markets Day in March 2024, we committed to various things. The first one was to be investment grade. It is something that we already said before that date, but we achieved on that date. We committed to be five to six times leverage. Being investment grade meant being below seven times with Fitch, below seven times with S&P. We also committed to start shareholder remuneration in the year 2026 with a €500 million dividend. What has changed since then till today? What has changed is that S&P, yesterday, because of the improved outlook, they have given us more flexibility. Fitch as of today remains exactly the same. They have not changed anything on their side. We remain with the limit of seven times.

This means that to be within their seven times, we still need to be between our five and six times. This is not changing today. Our commitment to be investment grade has not changed. We remain exactly the same. From a shareholder remuneration, that has been a big change. As you know, we had the €500 million starting in 2026. What we have done is accelerating this shareholder remuneration. We move shareholder remuneration from 2026 to 2025 by doing a share buyback a size of €800 million. What we committed as well is that for the year 2026, the shareholder remuneration between dividends and share buybacks will not be below the €800 million that we committed. The different divestments of Switzerland or France do not change that picture.

This means that what we have committed the same like we did in the Capital Markets Day, each without further disposals or other inorganic things. This means that the €800 million committed for the year 2026 remains whatever happens with the two transactions of France and Switzerland. If the transactions were to happen, we will reconsider them. The shareholder remuneration for the year 2026, but the rest is not changing.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay, thanks. Thank you. Sorry, just in the interest of time, we’ve still got quite a long list of questions and it’s already getting close to lunchtime. What I’d suggest is we limit the amount of questions to two without follow ups. Obviously, the IR team and the management team are available afterwards if you need further detail. We’ll move on to the next question, which comes from Nicholas George Lyall from Berenberg.

Nicholas George Lyall, Analyst, Berenberg: Yeah. Morning, guys. Can I just ask one about the rental levels, please? I’m assuming that the SFR rents for the urban sites that we’re talking about are high. Could you just talk about the risk that the rentals are higher than averages in France and how you offset some of that, and also how much control do you have over the timing of the revenue impact, you know, the short-term impact versus longer-term gains, for example. Could you talk through the risk of that as well, please? Thank you.

Marco Patuano, CEO, Cellnex: The topic of the prices in France is a no issue. The prices are fairly aligned in France, which is the market, it’s the dynamic of the market. In France it’s super interesting because prices are further aligned and the number of operators are many, the tower operators are many. It means that there is a market and a market price, different object, more or less the same price, which is okay because you have not an incentive to move because you have to trade between different price expectations. As I told you, it’s a super good example because the French tower market is possibly the most fragmented in Europe and prices are not that different. I don’t expect the pricing to be a particular issue in France if a structural change in the market happens.

By the way, everybody considered that the structural change happens tomorrow, which I honestly have to say that it’s not that obvious. We are just discussing about a case, a possible potential scenario and you all know that the transaction is monster big and monster complex and nobody asked the French government what they think about. It’s. Let’s go on. How do I think short term versus long term? I think that the short term, in case of a redesign, the short term.

Raimon Trias, CFO, Cellnex: Is.

Marco Patuano, CEO, Cellnex: A lot of activity for gaining efficiency via rationalization. What I mean is if you are a CTO, for you efficiency can be I get the same quality and I spend less or I spend the same, I get more quality. In an integration, especially given the behavioral remedies that the authority are adding to the authorization, are putting for the authorization, this is very valuable to a CTO. What we see both in the UK and in Spain is that after a while, and I would say less than one year, so much shorter than what we believed, the same CTO comes to us and says, hey guys, the pure rationalization is not enough. Why? Because you put together two customer bases that are normally very different.

For example, when you take Spain, MasOrange and MasMovil and Orange were very different characteristics of the clients in terms of age, in terms of mobility, in terms of data consumption, in terms of many things. When you have to serve a more complex customer base, you need more. Our experience is request number one is flexibility, which drives efficiency in a relatively short period of time. It is a much deeper analysis on the short-term needs. Then we work on the long term, which is 5G penetration, more data, etc. The long term doesn’t change. What is surprising us positively is that we thought that the short-term cannibalization would have been higher than what it really is. The two cases, Spain and UK, are a test case. I would say it’s not theory, it’s a test case.

By the way, the theory, I was convinced it was worse than the reality. I hope I answered Nick.

Nicholas George Lyall, Analyst, Berenberg: No, that’s great. Thanks very much.

Marco Patuano, CEO, Cellnex: Thank you.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay, so now moving on to Fernando Cordero from Santander.

Fernando Cordero, Analyst, Santander: Hello. Good morning. Thank you for taking my two questions. The first one is on the secondary tenant contracts. In that sense, I agree with you, Marco, that you have been so vocal on your strategy when renewing the secondary tenant contracts. You have explained the situation in France, but I would like to understand what is your current approach, renewing those secondary tenant contracts. For example, we have one big in Italy with Iliad and so on. I want to understand again, what is your strategy when renewing these secondary tenant contracts. The second question is, I would say, more in detail, but related with one of, let’s say, the potential optionalities in the sector, which is RAN as a service.

I would like to understand why in Poland in the second quarter, we have seen a quarter-on-quarter decrease in RAN as a service revenues, particularly considering that this is, I would say, the test of concept of this business line.

Andrew Lee, Analyst, Goldman Sachs: Okay, thank you.

Marco Patuano, CEO, Cellnex: Yeah. The Zegoda case is paramount for understanding why the secondary tenant contracts are important. You know, the Spanish case is one clear example of testing the robustness of an MSA contract. How I look at the secondary tenant, for me, is an anchor contract. Differently from the U.S., an anchor contract is made with an industrial component and with the financial component. Okay, so the industrial component is what you price in the secondary tenant and the financial component is what is priced in the anchor contract. It’s not true that I can, and this is, by the way, the reason why, market by market, if you look at how different tower operators price the secondary tenant, yes, there are marginal differences because in operations you can be better or worse.

By the way, a larger operator is more efficient than a smaller operator, and so we have a good pricing capacity. Our strategy is we don’t compete on secondary tenant on price. What we do is we compete on service. My Chief Operating Officer has prepared a deck of SLAs that we insure to the client, which are top of the industry. We are pricing rationally. The way, again, is to have good contracts with good quality. Depending on the case, there are tower adaptations that we can absorb or we can agree with the client that they will pay for, and this will also influence the price. If I have to absorb the adaptation cost, possibly it’s higher. That’s it.

Raimon Trias, CFO, Cellnex: Poland, on the other topic, Fernando, on Poland, the deviation that you have is not coming from the RAN as a service per se, it’s coming from the lower activity. You know that we have both as a service but also as trading, and last year Poland had more activity on trading. This year is less activity on trading. If you want, later on with the IR team, you can get further details so that you can try to understand the variances.

Marco Patuano, CEO, Cellnex: I hope it’s clear what is the difference between a trading activity.

Raimon Trias, CFO, Cellnex: When we talk about trading or DAS as a service, DAS as a service is when we do execute the CapEx. You have long-term revenues coming from the contract where you are charging not only for the asset but also for the service that we give to them in terms of maintenance and the management of the tool, etc. In the case of the DAS as a trading, what we do is we buy and sell as a trading activity. You have the cost going through the P&L, not as a CapEx, and then we just invoice a lower amount going forward that is linked to the maintenance.

Marco Patuano, CEO, Cellnex: Yes, we make an engineering activity for.

Raimon Trias, CFO, Cellnex: A client, so that’s the difference. In terms of the numbers, you can check later on with the team if you want.

Marco Patuano, CEO, Cellnex: Okay, the run is.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay. So now moving on to Roshan from Deutsche Bank.

Marco Patuano, CEO, Cellnex: Hi, morning everyone.

Roshan, Analyst, Deutsche Bank: I’ve got two questions please. Firstly, just from France and very quick follow-up. Whilst we’re clearly seeing how the situation evolves, I think some of the operators have said discussions are taking place. Have you already been involved in these discussions at this stage? A lot of talk has been around the top line implications. France remains the one market where you have the biggest build to suit. Is this where you can really at this stage look to combine this build to suit, something which you’ve talked about before? Rather than just having the top line benefit, you’ve clearly got the material benefit at the OpEx level and those high tenancies. Second question, more operational on the Landco. I think previously you were running at around 900 site actions a quarter.

Now, whilst you’ve given the absolute spend, are we still looking at that 900 level or have any of the pricing dynamics changed there? Thank you.

Marco Patuano, CEO, Cellnex: Okay. In France we had a separate conversation with all our clients, including SFR. As far as we know, there is not a common table, so we cannot be invited to a table that is not there. What we told to everyone and the answer we got from everybody is that the day that this table will.

Raimon Trias, CFO, Cellnex: Be.

Marco Patuano, CEO, Cellnex: Up and running operationally, of course, we are an important, an important element. You were mentioning the build to suit. Of course, the build to suit should be understood, but the build to suit, if you do, you do. If you don’t, don’t have the CapEx and you can allocate the CapEx to other things. The build to suit per se are a good business as of today. Making a big average, let’s say that is like buying at a tower set 15 times. It’s a good business. I don’t want to build useless towers. If my client doesn’t want, I save the CapEx and I use the CapEx differently or I give the CapEx back to my CFO who is happy like a baby.

Raimon Trias, CFO, Cellnex: On the land, if I may, it is true that until last quarter we were reporting the number of actions we put on. This quarter, you have seen more focus on the value of the action, because it makes more sense to look at the value. We will come back if you need to put the number of actions. Number of actions have increased slightly. We have done in the first half of the year 1,900, approximately a bit less, but 1,900. I think the first quarter we were below the 900, which meant that you have increased a little bit, it’s still not significant. You have seen that also the value of the actions have been a bit higher. We have increased the land activity by 23%, reaching €115 million in this first half of the year.

Marco Patuano, CEO, Cellnex: Yes. What we can add is that average price has not changed. The activity of the land aggregator is not hurting us in terms of return that we can get from the acquisition or long-term renegotiation of the contracts. Very importantly, we are finally landing to a more quiet scenario in France, and allow me to stop here.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay, so now moving on to Ottavio Adorisio at Bernstein.

Hi, good morning. For the benefit of time, let me ask straight question numbers. The first one is if you can give us a bit more granularity about the agreements you announced today. With Taft and Digi you didn’t make any change to guidance. I suppose that either the contract is negligible or is back end loaded. The other one on the numbers is on the CapEx. The bulk of the growth CapEx still inside adaptation now from memory. It’s a lot to do from upgrading some of the towers you bought to multi-tenancy. If you can provide an update on the ratio of your tower portfolio that’s already been upgraded to multi-tenancy and what’s the current upgrade pace you are going at the moment. Thank you.

Marco Patuano, CEO, Cellnex: Okay, I answered the first. So the Digi case, the RAN sharing fee is a demultiplicator of a second tenant fee because you don’t have the physical assets or you don’t have—you don’t use the space and the electromagnetic, so you’re using my capacity to holster in terms of potential revenues, but you are not using physical space. It’s a plan. That is why we didn’t change. We didn’t change because the activation of the 3,000 RAN sharing would take, I would say, something between two and three years. The total contract value is not negligible, is three digits. So it’s not negligible, the total contract value, but the rollout—you know, infrastructure has the pain point of, Ottavio, that between the moment you agree and the moment you execute, there is quite some engineering to do and some bottleneck.

Also, with the equipment providers that have to do activity, you have to change the software, you have to do things, but it will take a little bit of time. The total contract value is not negligible. On the second, I leave it to.

Raimon Trias, CFO, Cellnex: On the second question, as you clearly expressed, now we have in the CapEx this tower expansion CapEx that includes the fact of reinforcing the towers in order to have multi-tenant towers. As you know, when we bought some of the portfolios of towers, some of the towers were not prepared to hold multi-tenants. That’s why we are having to do.

Marco Patuano, CEO, Cellnex: Can I expand on this because I think it’s important. Please consider that in Europe most of the towers have been built by the operator themselves for hosting their equipment in a 2G 3G environment. When you take the tower.

Raimon Trias, CFO, Cellnex: The.

Marco Patuano, CEO, Cellnex: Oldie one, the oldest one, you don’t have a big mast that you can put an elephant on it. It was a relatively thin animal that was able to resist 50, 60, 70 kilos. Now if dual tenant 5G, we’re hanging at 30 meters, we’re hanging a ton with approximately 15 square meters of wind effect. You have to imagine that on a windy day you have to avoid that your tower goes three miles away because it starts flying, which is what happened in Portugal two months ago. Three months ago a windstorm took seven of our towers and moved nicely sort of 200 meters away. Thank God we did not kill anyone. This is very technical. That comes from the origin of the industry in Europe.

We are doing not because we like, but because in order to make the collocation, you have some technical activity that has to be performed. Sorry to jump to.

Raimon Trias, CFO, Cellnex: I think super clear. It depends very much on the country. There are countries that have already done most of the work that needs to be done. Others are still needing to do. It depends very much on the country. If you want, again with the IR team, we can give you more color on a country-by-country basis where we believe it will be heading over the next years.

Marco Patuano, CEO, Cellnex: Yes, correct.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay, I think that’s it. I don’t think we have anybody else.

Marco Patuano, CEO, Cellnex: I thought there was James.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay, no, yes, we do. The last question comes from James Edmund Ratzer. James, you’re the last question before us and lunch and the holidays. Please go ahead.

Nicholas George Lyall, Analyst, Berenberg: Good.

Raimon Trias, CFO, Cellnex: Thank you. Thank you very much. Maria. Keep it brief. I was just doing a little back of the envelope calculation, Mark, on what you were saying about the Digi RAN sharing agreement. To make it a three-digit value over eight years, that would seem to imply that you’re getting about €6,000 per site from Digi RAN sharing. Is that around the right ballpark that you can get?

Marco Patuano, CEO, Cellnex: I’m sorry. I’m really sorry, James. We don’t enter in the details of the contract because it’s covered by NDA. There is a little point when we calculate the total contract value. The duration of the contract has several clauses of automatic renewal. You should imagine that this contract, and they have an agreement with Telefónica, 15 years. A good part of our contract, there is a part of the contract with a shorter duration and a part of the contract with the longer duration to be compliant with the terms that Digi has with Telefónica. You should review slightly on the envelope, you should review slightly the duration of the contract. I hope I gave you any hint.

Raimon Trias, CFO, Cellnex: Yes, thank you very much indeed, Jan. Have a great summer break. Thank you.

Marco Patuano, CEO, Cellnex: Okay, thank you, James.

Maria Carrapato, Head of Investor Relations, Cellnex: Okay, so we’ve come to the end of the questions. As always, the team is here to follow up on any specifics that you’d like to cover. If not, have a wonderful holiday and look forward to speaking after the summer.

Raimon Trias, CFO, Cellnex: Thanks, everyone.

Marco Patuano, CEO, Cellnex: Thank you. Thank you. Have a good holiday.

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