I don’t know, I guess, you’re not going to be able to give us any more on that. But is — rather than just I guess put fuel under the fire of speculation, is there anything you can say? So yes, my second question is a bit clumsy, but just anything else you can give on us I think we’re all scratching our heads a little? Thank you.
Angel Vila: So Markus, please with the first one.
Markus Haas: Good morning, everyone. So the German market remains rational with dynamic promotions. We tested in the first quarter, clearly, the sensitivity on family activities. And you have seen we have a solid momentum in the first quarter, a good start into the year. So from that perspective, we clearly want to capture more of the household budget, also including fixed. And we clearly saw a fair share trading with our core brand, the O2 and also our no-frills brands in the market. So, as I said, a very rational market, and we clearly see sensitivities and a way for us in order to capture more of the household budget of the German market.
David Wright: Markus, could I just quickly ask you, are you feeling any pushback from competition as you sort of push into those additional SIMs? Has there been any competitive reaction of note?
Markus Haas: From our perspective, I think we follow the market very carefully last year, especially what competition was doing. And we clearly see with a very good network quality that we clearly can gain more share in households. So I think as you’ve seen, we further accelerated our 5G coverage. The network is performing on level with competition. So we are a clear alternative in mobile for more than one family member. And secondly, also, while we can offer every household in Germany a fixed offer with our mix of cable, VDSL fiber, we are in a very good position, as said, to really leverage the huge customer base that Telefonica has in Germany in order to gain more of the household volume.
David Wright: Okay. Thank you for that.
Angel Vila: And regarding your further question on DiGi, again, we cannot comment, we have been — the market knows, and we have been stating that the spectrum transferred by MasMovil and DiGi does not allow to build a new network. So — and is placed in high-frequency bands. So this implies that DiGi would need a national roaming agreement. They have the option through the remedies of during the Orange one. But when can be ambitious and aim for not a pure roaming agreement that has all these renewal dynamics and so on that we’re asking a previous question, but something a bit more structural that stabilizes and gives long-term visibility to the wholesale relationship, and this is the direction that we have done, which is good for both ourselves and for and for our partner.
David Wright: May I just ask one brief detail, we can see our wholesale revenue, I guess, Q1 wholesale and others were showing about €20 million, €22 million in Spain. Are you able to give us any kind of indication of what amount within that is the DiGi contract and potentially the sub contract for mobile right now? Is it a €200 million ballpark? Is that what we could be thinking?
Angel Vila: Again, we do not disclose this figure. Wholesale and others in this quarter has declined but nothing to do with this. It has declined because of MTR prices declining and then the end of the Formula 1 cycle, we used to have that content and we resolved it. We are not having that contact. We are not selling it anymore. We are buying it from the zone. So any dynamics that you have seen in the first quarter on the wholesale line is completely unrelated to this contract. Actually, the MVNO line of wholesale is growing in the first quarter. Thank you.
David Wright: Okay. Thank you so much.
Operator: Thank you. We will now take the next question from the line of Keval Khiroya from Deutsche Bank.
Keval Khiroya: Thank you. I’ve got two questions also following up on Germany as well. So Germany obviously had the strong EBITDA performance of 5% growth versus the guidance of low to low mid-single-digit growth for Germany. Do you see that 5% growth sustainable? Or are there other OpEx phasing impacts we need to think about? And could you elaborate on those if so, please? And then secondly, with all the DiGi on wholesale discussion, you’ve shown that you’re trying to maximize network utilization in Spain? Germany on the other way with the loss of one and one, should we still think about retail being the main lever to plug that gap? Or are you starting to talk to other wholesale partners or even thinking more strategically with network JVs or even consolidation? Thank you.
Angel Vila: Thank you. Let me start with Germany. I think first of all we had a very solid start on profitability into the year and it’s clearly a mix of levers. The first one is clearly strong gross margin contribution from the trading we did last year. Also with the family offers we clearly see lower subscriber acquisition costs because we sell more into the base is more profitable for us and it was good to see the sensitivity also going forward. So it makes us also confident that in a mix of accelerated own customer growth within the base and additional products that we’re going to sell and clearly leveraging the partner landscape that we have that we will be able in the mix of accelerated growth, profitable growth and also efficiencies that we already started to capture from the beginning of the year onwards that we will deliver the plan as it has been presented last November by Telefonica.
So overall we expect clearly also profitability growth within the guidance that has been given. So from that perspective high confidence. As said on the wholesale side, we delivered a growth in a mix asset on customer growth where we now see the possibilities. Secondly, B2B growth. We also had a good momentum in this new segment in the first quarter where we accelerate step-by-step. It’s clearly a smaller P&L but overall it gains really momentum and contributes to the overall plan. And finally with the existing partnerships that we have we have all the optionality in order to push more or push less depending on the current phase of the market. So we have here we are well-positioned. As you know we have access to all sales channels in the German market with own or with branded resellers that gives us as said all the opportunities to push a little bit harder if needed in the quarter or to clearly accelerate the product portfolio in these channels in order to capture the growth.
Keval Khiroya: That’s clear. Thank you.
Adrian Zunzunegui: We have time for one last question, please.
Operator: Thank you. We will now take the last question from the line of Fernando Cordero from Banco Santander. Please go ahead.
Fernando Cordero: Hello. Good morning. Thanks for taking my two questions. The first one is related to the Spain not in this case we hope about retail and I would like to understand obviously at least on a qualitative basis the performance of the upon the rest of the year we have seen a minus 6.4% in the third quarter. Just to understand the drivers for this performance and also development on the rest of the year on retail B2C ARPU? And the second question is on the UK. And I would like to understand if there is any recent pressure on the potential materialization of the fiber wholesale opportunity in that market? In that sense how is the current use of from a [indiscernible] to tackle the wholesale but the fixed market in that? Thank you.
Angel Vila: Thank you, Fernando. On the Spain ARPU the conversion ARPU in the quarter reached €92.2 it’s €1 higher than the previous quarter. Thanks to the price increase that we applied in January to the Movistar portfolio. Year-on-year the ARPU declined minus 0.5% mainly on higher penetration of in our base versus Memo Vista. If one looks at the sequential difference in the quarter compared to one year ago the mean reason is that this increase is lower is that the tariff upgrade in January 2024 has been 3.1% and this was softer than the one year ago which was 6.8%. So we are comfortable and with the ARPU evolution. But I should say that more and more we should not look at ARPU individually. We look at it in a whole set of conversion KPIs. First the net adds and the commercial momemtum which is very positive.
This is correlated to a very positive evolution of customer satisfaction through the NPS with a minimum churn that we are in the slide putting slitting 0.9%, but we are in the 0.8% high leading to 0.9%. So it’s the minimum history and then the ARPU. These results in the largest subscriber lifetime value that we continue growing and we’ll continue widening resource our competitors. The second question on the UK regarding — I understand the Fiberco. We are progressing as well as discussing Liberty Global scholar few days ago. We have already appointed advisors for the design and carve-out of the NetCo. Simultaneously, we’ll continue building at pace and accelerating the pace of fiber build and fiber migration, and we have been receiving strong inbound interest for this asset in the case that we would be open to invite investors into it.
I don’t know if this answers your question or you need any deeper detail on the fiber in the UK.
Fernando Cordero: In the UK, you say, it’s basically looking also on the potential wholesale agreement that your potential wholesale clients, that you may onboard on the network to understand you are close or not over what’s your views on materializing this opportunity?
Angel Vila: Okay. Lutz, can you take this one please?
Lutz Schüler: Yes, sure. I mean there are three possible big wholesale partners one Sky, one is Vodafone and one is TalkTalk. And I mean, as you can expect, we are in negotiation with all of them. With one party, we are advanced but it’s too early to disclose any details here.
Fernando Cordero: Great. Thank you very much for the opportunity.
Operator: Thank you. At this time, no further questions will be taken.
Angel Vila: So, thank you very much for attending this call. We hope we have been able to provide useful answers to your questions, and please contact Investor Relations for further follow-up conversation. Thank you.
