Ladies and gentlemen, and thank you for standing by. Welcome to today’s TIGO Q3 2019 Results Conference Call. At this time, all participants are in a listen-only mode. After the presentation there will be a question-and-answer session. [Operator Instructions] Also, I must advise that the call is being recorded today Thursday, the 24th of October 2019.And without any further delay, I would now hand over the call to your first speaker today, Michel Morin. Thank you. Please go ahead.

Hello everyone. And welcome to our third quarter call. As usual, we’ll be referring to some slides which are available on our website. And if you turn to slide two, our Safe Harbor disclosure is there. We will be making forward-looking statements, which involve risks and uncertainties and which could have a material impact on our results.And on slide three, we define some non-IFRS metrics that we will also be referring to throughout this presentation. You can find the reconciliation tables in the back of the earnings release and on our website.So, with those disclaimers out of the way, let me turn the call over to our CEO, Mauricio Ramos. Mauricio?

Thanks, Michel. And a good day to everyone. Thanks for joining us today on the call. I’m heart fully [ph] joining you today from Honduras on one of our site trips. And as usual I’m here with Tim Pennington, our CFO.On slide four, you see how much strategic process we have made this year. We continue to successfully divest out of Africa reallocate that capital to Latin America, particularly to Cable. We listed the company in the U.S. and we will soon be a 100% free float company.And more importantly, our operating free cash flow has also continued to increase steadily towards a medium term target of around 10%. So our long-term strategic plan organic and inorganic is well on track, and delivering on the operating cash flow growth that it was meant to achieve. I am therefore happy and confident about our long-term and direction of travel.But since this is also a quarterly call, let me address the obvious on slide five and get it out of the way. Our Q3 revenue and EBITDA results were weakened that I had planned for. July and August were indeed quite weak, but September came back, yet not strong enough to make up for a good quarter.The key source of the short term disappointment is largely prepaid mobile, which is more sensitive to changes in the economy and in competitive intensity. In Paraguay, the economy has indeed been contracting, and this has no doubt put some additional pressure on the prepaid market which remain quite competitive as well in the quarter.In Bolivia, price competition in prepaid has picked up this year, ahead of Presidential elections which are now in the middle of the final stages we hope. But the personal side of the mobile story is that postpaid continues to perform well…

Thank you, Mauricio. So I'm going to start by picking up on a few of Mexico's remarks on the economy. And look first at the operating environment and then of the reported group numbers followed by the familiar review of the Latam segment.So let me start by turning to Slide 14. The title of this slide says it all. And many of you will have listened to the Oxford Economics view of the long term prospects for our markets. You'll have heard a very positive outlook, supported by very positive demographics and significant catch up potential.However, what has changed is the short term outlook. There it's very clear, there's a very clear regional slowdown possibly reflecting global trends and possibly local political events. We see GDP growth downgrading in many of our Latam markets in the last six months.Now on slide 15, you can see that our business profile has changed with the acquisitions in Panama and Central America. We are reducing our exposure to more volatile economies and currencies.In Q3, more than 50% of group revenue was generated in Central America, which traditionally has maintained more stable currencies, supported by substantial U.S. dollar missing states. And in fact, if I roll forward to the end of next year, we'll expect Central America revenues to be around 55% with Africa below 5%.Okay, let me now turn to the group numbers on slide 16. And if you recall, we treat Guatemala and Honduras as JV's in the group reported P&L. Service [ph] revenue increased by 10.8% that's largely on acquisitions and that more than offset weakening currencies.Operating profits however, was 15% lower and again this largely reflected acquisitions, namely higher expenses and higher amortization charges. And we also had an IFRS 16 impact. And finally, they were lower gains on sales…

Thank you, Tim. Let's look a little bit ahead. As I said at the start of this call, a lot has happened in just this year, so much so that it would be easy to overlook the fact that our shareholder structure is also undergoing a significant transformation, as we've shown on slide 27.Kinnevik, our largest shareholder is executing plans to distribute its entire 37% stake in Millicom to its institutional shareholders. And I want to take the opportunity to personally thank Georgie, the Stenbeck family and everyone at Kinnevik for their longstanding support to Millicom and particularly for this report that they have given us and this management team over our tenure in the last four years.But as many of you know, Kinnevik on strategy has taken them in our direction that is different from ours, and that presents us at Millicom with some short term challenges, as well as some important long term deposits.In the short term, this distribution is a very significant increase in supply of this stock, and this would indeed add volatility to our stock price. But this is a temporary dislocation, for investors willing to take a longer term view the end game is first, the stock that will be significantly more liquid and one of only two companies in Latin America with 100% treatable.Second, a company with a strong corporate governance framework with both the U.S. and Sweden listings, a single class of stock, and compensation structure that outlines management and shareholders significantly. And I can tell you that as a management team, we are all very excited about the opportunities that lie ahead to this company and work 24/7 seven days a week.And also for the benefit of the Kinnevik shareholders we’ll soon receive Millicom shares. Please allow me to remind everyone…

Ramona [ph] if you can open up for questions, please.

Thank you. Ladies and gentlemen, we're now beginning question-and-answer session. [Operator Instructions] Our first question is from the line of Mathieu Robilliard. Thank you, please go ahead.

Yes, good morning thank you. First question was on the 2019 guidance. So quite simply over the nine months, you did 2.2 organic growth and 1% in service revenue in Q3, you are pointing to about 2% for the full year. So I guess, you're expecting a re-acceleration of service revenue growth in Q4 compared to Q3. Maybe if you could elaborate a little bit on the drivers for VAT. I think in the past you'd mentioned, that in Colombia, you could have a big B2B contract potential announced today, that you will disconnect the customer, maybe that B2B Colombia is not such a strong contributor, anyway that's the first question?The second question is with regards to Nicaragua. You highlight that some tough macro trends there, and I was wondering if that meant that revenues were down year-over-year in Nicaragua? And then finally in terms of Bolivia and Paraguay, obviously you're trying to protect market share, and are succeeding in doing that. You're using price it seems as a way to fight back. What are the other tools that you can use to protect yourself against the competition? And will Bolivia eventually follow the route of Paraguay for a few quarters? A few questions, I'm afraid. Thanks.

All right, Mathieu that's a handful, but thank you because they're all very very good questions. I tried to take notice if I can answer them all, and maybe I'll leave that 2019 guidance delivered towards the end to wrap up with that.Let's start with Nicaragua. Honestly, we've only among [ph] the asset for a little bit, and the macro in Nicaragua indeed has been significantly weakened because of the political turmoil. I think once the political turmoil and stability subsides, and whether that happens, short term or medium term, it's very difficult with all things political to determine, the macro will come back strongly. And the flipside positive to that is, as I said on the call, we did buy a really good asset with big market shares, significantly strong market position. It strength our cable build, because it gives us the ability to blanket the country with mobile while we build, and more importantly, and I think this is key. We have although it's early on, found some interesting opportunities to make more efficient use of the spectrum, and gain on procurement.So whereas indeed the economy has been hit, and indeed we should expect that it's going to be tougher on the top line, we do see upside significantly on the operating cash flow, because there's spectrum efficiencies and because there's consuming upside there.With regards to Bolivia and Paraguay, and what's going on there, and other tools. So listen, I see there's a similarity here in our time to react to economic downturns or political motivations, behind increased competition particularly in prepaid. We try to let the market work through those, but if it doesn't, we react very very strongly as you've seen us do. And both in -- and we do that by basically making it very…

I would add, I mean, look, we are forecasting the year end will be stronger than the year-to-date on EBITDA. And therefore, we got more visibility on EBITDA at the moment, Mathieu. And so the revenue where we expect both the strong EBITDA, the comp is a little easier. And we've got some kind of good kind of things coming through in the fourth quarter, particularly B2B and we’re a little bit more cautious on revenues simply for the reasons that Mexico outlined, and the reason is that when you are questioned, a little bit more uncertainty now on Bolivia and you know kind of the macro environment is a little more challenging. So it's been a tad more cautious on the revenue outlook. But I think the message of this is, that you know to the extent that we found our environment has changed, we kind of change tack and make sure that we maintain the market share, we maintain the margin, we maintain the cash flow, and that's really what you've seen coming out of the Q3, and what you will probably see coming out of Q4.

Thank you very much.

Our next question is from the line of Lena Osterberg. Thank you. Please ask your question.

Hi, yes hello. I have three questions, please. First of all, looking at the Mobile ARPU you now down 4.5% year-over-year. So I was wondering how much of this do you believe is related to say temporary measures for defending your market share in Bolivia and Paraguay, where you could possibly if the climate improves raise prices again, or how much of this will be there for another 12 months, because it's a permanent price cut?And then the second question is on Guatemala, here I understand Claro [ph] is now in the process of migrating telephonic customers. Do you know how far they have come in that process, and do you expect that competitive pressure will ease once they have finished that migration?And then finally on Colombia. You mentioned a couple of times now that you will have a negative impact from disconnecting one of your wholesale customers, if you maybe could say what the reason is for disconnecting them, and how much you expect in terms of impact on a full year basis, and if it will be a full quarter impact or not?

All right. So the mobile ARPU. Lena and thanks for the additional questions that help us provide all this color. It is indeed largely prepaid, if not entirely prepaid. And Tim can correct me. This is not 100% correct. That isn't hesitating not to say that, or I don't hesitate to say that is because, our postpaid business, which is the other side of course of what's in Mobile, quietly has been growing very very nicely, and very very stable. I think, I alluded in my remarks or we put it somewhere in the release that our postpaid business in mobile has indeed been growing its revenue mid-single digits.And that’s on the back of volume. We're adding somewhere around 250,000 on a yearly run rate basis postpaid subscribers. Do you know that that's what we're driving the business towards subscription cable on postpaid? Past two or three years ago, that number was negative, and we've sustained now seven quarters of consistent postpaid gains in subscribers or about 50,000 to 75,000 per quarter. And that mobile revenue is on postpaid is growing.So it is entirely prepaid, and prepaid is very sensitive to macro and to competition. It's less resilient than a subscription business. When it will subside, depends on factors that we don't fully control, whether it's the economic factor being Paraguay or the political situation in Bolivia, or some additional competition that may have come out of those countries or other countries. But eventually it will subside, whether it's next quarter or two quarters from today. And when the industry structures return to their stable equilibrium levels, indeed ARPUs will come back.If you look at the chart that we showed for Bolivia prior to this location, ARPU had been going up. If you were to look at the Paraguay situation,…

I would just add on. I mean, we disclosed in the earnings release, we took a $5 million debt charge in the third quarter for that, and we know that wholesale contracts. There was no revenue impact actually in the fourth and the third quarter. We were still booking revenue, we’ll stop booking revenue and effectively with it -- with effect from the end of October. So again this September, so there will be no revenue in the fourth quarter. I can't be specific on the amounts of impact on that plane, but we’ve given you the bad debt charge. But I give you some sort of help.And you know we will take it up. This is – will be a ready one in EBITDA impact force in Q4. I think just picking up….yes go on.

How long before you start talking about that chart. How many months of lost revenue?

You know kind of essentially the bad debt charges now done. We’ve provided most if not all of that. So what happens from now on is we stop recognizing anything income, there won't be any income coming because we stop them on the networks. So, essentially there shouldn't, there shouldn't be an impact for us other than the absence of that revenue and hence the absence of that EBIDTA into Q4 and onwards.

Why don't we figure out how many months of revenues that would have been, if you could provide, when do you start to book about that short term? How many months late payments do you have to have for you to go to bad debt?

Well, it's round -- it's round about 90 days. That 90 days non-payments that we go then.

Okay. Thank you.

Our next question is from the line of Johanna Ahlqvist. Thank you. Please ask your question.

Yes. Two questions, if I may. The first one actually relates to Africa with Tanzania. And if you can give us any update on sort of what's happening there. I know you mentioned that this process is taking longer than expected, and I guess if you do not see sort of proceeds from Tanzania in the sort of foreseeable future, would you expect that -- I mean would you consider to cut dividends to deleverage faster than you currently are?And then my second question, now I guess you touched upon this topic before, but you mentioned that September is better than August and July. And I'm just wondering, if you relate, referred to the competitive climate, or macro, or if it's sort of general comment? Thank you.

Yes, and so I'm going to start with the last one, because that's the one that's more present in my mind. The answer is very simple. We had subscriber intake come back in prepaid, you've seen the numbers or we’ve alluded to the numbers. And with those renewed revenue, and we've been able to therefore stabilize the markets, where we had the most competition. And as a result of that, September came back from subscriber interest. So that's I think the key reason for that.It just wasn't as strong as we had hoped it would, and therefore my comments before. On Africa, I think you know indeed we've said before, that Tanzania you should just you know take a deep breath and allow us to do in Tanzania as we've done everywhere else. We're going to have to pick our timing, and our movement to do that.In the meantime as you saw, the IPO of HTA was accomplished, and so was the HBO [ph] or the IPO of Jumia. So those are assets that now said a little bit more liquid, and well within our Treasury Department to determine what to do with them, and what the right time frame for that is.So I want to address the more important point, I think you made just to not live it sort of about their high timing. Regardless of Africa, and Africa has never factored into our decision making around our capital structure, and our dividend or leverage policy because we've always known that as much as we're allocating capital into Africa into Latin America. The timing and our ability to execute could as we have been on it, we've never fully controlled.So it's never been part of our core plan or we’re going to be super clear on that. We've…

Crystal clear. Thank you.

Our next question is from the line of Stefan Gauffin. Thank you. Please ask your question.

Yes. A couple of questions on Colombia. You have reported quite good growth in mobile, but there is a large subscriber net lost in Q3, 2019. Is there a change in a competitive landscape in Colombia?And then secondly, also, you've stated in the report that home growth in Colombia was impacted by promotional campaigns this quarter. How should we think about that going forward? Is that continuing into Q4 next year? Thank you.

Yes. So as I -- as I said and thank you for the question. I think the key thing about Colombia is that all the lines of businesses are growing mobile, cable and B2B is a healthy growth [ph] if you back the spectacular 2000 NP [ph] that we had. So as we said here, we're in a far better place than we were a couple of years ago, when Colombia was a little bit of a headache for us. Now it is growing healthily. And by the way, we keep making significant progress on margins, just about every quarter.Mobile for us, when you look at the entire subscriber base, you miss out on the and that’s just the way we reported it. It's not -- not something that you would necessarily view. It's largely the effect of us moving our subscriber base into the “Unlimited plans” that are more of a subscription nature by definition. And our focus has been significantly to move those subscribers to those plans, because the lifetime value is higher. The churn is lower, the cost to serve is much smaller, and we basically regained more during the market. And that has given us tremendous amount of postpaid growth in Colombia on the mobile business, which is on the back of our underlying growth in Colombia.And it's also helping us position ourselves for a combined postpaid world in mobile, with our increasing pushed on cable. We had a record year, a record quarter sorry, in Cuban made ads in Colombia at just short of 50,000 net ads on cable Colombia this quarter, which is pretty fantastic. So I don't see any concerns on the volume in Colombia. Despite that promotional activity, we added 46,000 which you've seen ads in Colombia, which is pretty meaningful. So it's not taken away from our ability to continue to grow in Colombia. So you know there's a lot that remains to be fixed in Colombia, but it's certainly a country that's beginning to work for us.

Okay. Thank you.

Our next question is from the line of Henrik Mawby. Thank you. Please ask your question.

Hi, good afternoon. Can you hear me?

Yes, well.

Yes. so good question from the previous speakers. But I guess coming back to Bolivia. I mean, judging by the comments in the report it seems like ARPU is dropping mid-teens I believe. How should we think about this? Is there still a large base that can spin down and is this sequentially or are you seeing it leveling out now or should we expect it to continue in the coming quarters?And then a similar question on Paraguay. It's also there quite a dramatic deterioration in the ARPU and Mobile, but you allude to it stabilizing at least Q3 over Q2. But I – you know reading the comments and hearing what you say about macroeconomic environment and Paraguay getting another hit, is it still stable now in October, or should we be concerned that it takes another round down? Thank you.

Yes. Listen, I'm a little bit more optimistic on Paraguay. Or let me rephrase that. There a lot local visibility on what may happen in Paraguay, Honduras than Bolivia. And in Paraguay indeed you've heard us say that we're regaining subscriber intake and this about prepaid we're talking about by the way, B2B, postpaid and the cable business remains very, very solid. We have seen their subscriber intake come back in Paraguay. And as a result of that we're now stabilizing market share positions if not gaining. So the volumes are stable and we have begun to see ARPUs stabilize in Paraguay. And that's just a result of us fighting back. So I don't imagine that the industry there wants to continue to spin down the ARPU or in they are no market share gains to be attained. We have a fair amount more of a comfort level there if you will. The economy has been negative for a couple of quarters, but that's been a result obviously of the situation in Argentina, but also if that drops that occurred there earlier in the year. Rate has come back and hopefully Argentina will stabilize. Just about everyone is speaking of renewed economic growth in Paraguay next year. So every single forecast that I've seen differs in the amount of positive growth that will occur in Paraguay next year. But everyone is positive as opposed to negative where we are today.So with a moderate degree of optimism I think both the industry and prepaid will be more stable going forward. And the economy will come back. Bolivia is similar in the industry situation i.e. we've fought back as we've shown you. And as a result of that the market share is completely stable at this point in time. And as I said during my remarks, this is hurting others as much as it's hurting us if not more. And we haven't given up an into market share nor will we. The reason why it's a little bit more difficult to predict when, I think we have the same concern is because there's a fair amount of uncertainty for Bolivia as we speak right now on the political situation. So going to be a little bit more cautious and when Bolivia is going to turn around. Having said that, it is a country that remains macro solid, it's going through a democratic process that has puts and takes here and there. But more importantly, it's an industry that's demonstrated the ability of global fixed to mobile. So when it's a matter of question mark, but its no doubt it's going to come back.

Yes. I would emphasize that Henrik. I mean I think we just showed it, although we didn't put numbers on that you know kind of you're right year-on-year our ARPU declines round about 12%, but you see them flattening off, so sequentially ARPU decline in Q3 was somewhere in the two to just a bit north of 2%. So I'm not sure we're going to call that as the bottom, but I think we've taken a big step down. And the other point I would make is that also in Bolivia it was been an historically relatively healthy and as you know we expect that to continue to be the case relative to the average in the group as a whole.

I think that's a big thing here -- the big thing is that when you have macroeconomic dislocations or political turmoil prepaid gets hit. And if you add a little bit of competition or if you have some competition in there this political and macro turmoils only heightened that segment of the marketplace. And that's one of the big reasons why we've got pinned our future into more and more subscription, more and more fixed mobile and more and more B2B precisely so that we isolate ourselves from these orderly hiccups. It does not take away from the long term, but due process to you know takes from rain as we're going through what we deem to be a long term outcome.

Understood. And maybe one more question while I have you on the line here. On Africa cost came in quite substantially below my expectations. Is there anything temporary natured in those costs or it seems like you're just bringing it down quite handsomely?

Well, I'd like to take a round of applause on it, but I suspect IFRS 16 is the answer to that particular question. But we perhaps thinking…

I should -- I have made the adjustment, but I still think it will come down but…?

Look, let's talk about the trend, Henrik, you know effectively we no longer have a long-term based around Africa team because we no longer have an Africa position. What we have is a couple of portfolio positions, HTA and junior and a single country position. So that does not require a London based headquarter.

Thank you.

Our last question is from the line of Peter Nielsen. Thank you. Please ask your question.

Yes. Thank you. Yes. You may actually Michel just have answered the question. You seem to have or you have maintained your medium term ambitions. But as Tim said earlier there has been a number of downgrades to GDP forecasts in the near term. I'm just going to ask how sensitive you believe you are to those and perhaps just partly answered it mobile issue, but I mean how sensitive do you think you are in terms as your ability to leverage on the revenue growth that may be into higher EBITDA growth. If you give any more color. You just indicated you primarily see this as a prepaid issue. Is that correct? And is this anything else to add on that subject? Thank you.

Great question and perhaps that has fully allows me to sort of wrap up a little bit of what I think is a long term view here. A straightforward, no hesitation answer to your question is no. There is no reason for us to change our medium term guidance outlook view. As I said to in the prepared remarks I remain as confident as I had ever been on a long term plan. And remember, just couple of months ago I put ton of my own personal money behind this plan. And the reason for that is the underpinning of our strategy here is low penetration broadband rates across all markets whether it's 4G or cable, fixed broadband and the ability to generate better industry structures with the cable deals that were put in place which underpinned our mobile business but helps us reach into this penetration rates. And that has not changed because there's been an economic slowdown in [Indiscernible] country at quarter over there.The second underpinning to our story is this growing middle class. We are expecting that over the course of the medium term outlook the middle class in our markets will grow by about and by that we mean those over $20,000 income per year will grow by about 6.5% and about half of the population in our markets is sits between the high teens and early 20s. We have a young population that's adopting digital in the midst of improving industry structure that we ourselves are driving like we did in Central America. So the underlying secular macroeconomic industry structure drivers to our plan remain there. What's going on here? This is like when you set out to run a long marathon. If you guys are runner or like technology so you're going on a long trip. And you have a clear cut way in which you're going to run the marathon, you know you want to get there in given time and you come an accident on the road or block road here and it starts raining on you. You know that all of that's been passed and you know that you want have finished you know that you're going to strong because you are trained and you have a plan and you believe in what you're doing.So a slow order here or there, a correction to games on any given year does not take away from the fact that our pace in this marathon is pretty good. Our strategy is solid and our capital discipline I believe is unmatched and strong. We're allocating capital exactly when needs to be allocated and this long term plan underpins, the way I describe is as solid as I ever was. So perhaps just a long way of saying we remain confident in our medium term outlook. And if you're hanging, longing uphills you'll see it come through next year.

Okay. Thank you.

No further questions at this moment. Please continue.

Well, I think that was probably a good way for us to finish the call. So thank you everyone for joining. Do take a look at our long term prospects and we'll continue to do what we do pretty well, which is drive broadband penetration in these markets. Thanks.

So that does conclude our conference for today. Thank you all for your participating. You may all disconnect.