Hi, everyone, and welcome to our Q1 2020 results conference call from home. As usual, we're going to be referencing some slides, which are available on our website. And if you will please turn to Slide 2 for our Safe Harbor disclosure. We are going to be making forward-looking statements today, and these involve risks and uncertainties, which could have a material impact on our results. So please take a look at the details here.And then on Slide 3, we define the non-IFRS metrics that we will be referring to throughout the presentation, and you can find the reconciliation tables in the back of our earnings release and on our Web site. So with those disclaimers out of the way, let me turn the call over to our CEO, Mauricio Ramos.

Thanks, Michel. Good morning, and good afternoon to everyone. We hope each one of you is safe and in good health. And we wish you all and your families the very best in this difficult times. Our call will, of course, be a bit different today. We are living, as you know, through unprecedented times. So I will focus most of my remarks on COVID-19, how we have responded, the impact it has had on our business and how we're preparing for the future. And then Tim will go over our Q1 results in more detail.Let's start on Slide 5 with a time line of our response. In Phase 1, we started more than two months ago, we activated our crisis management response, and we move quickly to ensure the safety of our employees and the continuity of our service. In Phase 2, we have essentially replanned our business for the year. We have laid out some guiding principles to help streamline our decision-making during crisis, and we have set up a task force to adapt to and learn from the new realities.To share best practices across our markets and to capture opportunities as they present themselves for the future. Phase 3 will be the market recovery. It is hard to imagine that right now, but it will come, and we will be ready for it. We will come back to this later. But first, let's take a closer look at the last two months beginning on Slide 6. I will not go over every single point on this slide, of course. The key point here is simply that we have accomplished a lot in a very short period of time. We have got the bull by the horns, if you will.We operate in emerging markets, so we're used to…

Thank you, Mauricio. I'm going to start by looking at Q1 on Slide 15, and then I'll focus on the financial aspects of our response to COVID-19. So basically, COVID-19 did not impact our business until mid-March, as Mauricio said, we're pretty much on track until that point. And bear in mind that last year, so our first quarter was our strongest quarter. So this left our Latam service revenues broadly flatten on an organic basis, as you can see here. But around the same time, we also saw the currency impact of oil prices in Colombia, and that left us with a 3.5% FX hit although this was offset by revenues from acquisitions.So on a reported basis, our service revenue ended up 5.5%. Organically, EBITDA fell by 2.5%, although half of the fall came from a one-off charge in Nicaragua related to the acquisition, and OCF was 3.9% lower. And again, that was basically due to the EBITDA one-off, as well as facing differences in CapEx execution. I think you've heard from us, we are targeting measures to maintain the OCF for the year, and this is important as we search for measures to accelerate our deleveraging activities. So if I pick up now on how we've seen COVID-19 impact on Slide 17. The indicators on this slide give you a sense of what we're seeing, but note, it is still very fluid.So on the left-hand side, you see the components of our organic service revenue growth and perhaps unsurprisingly, prepaid and B2B that have been most affected. In prepaid, as Mauricio said, it really has been the lack of mobility and the correlation between the severity of the lockdown and the impact on revenues. And you can see this on the chart on the right-hand side, this shows…

Thank you, Tim. Before we take your questions, let me just conclude by saying that I am incredibly proud of how our teams have responded to the challenges we have faced in the last 2 months. Never been that start as I am today. We've never been more proud of the long hours that everybody is putting in there. You heard me talk about our strong culture, that passion that we bring to work every day. We refer to it internally as SangreTigo and the SangreTigo has kept us focused on our customers throughout the first phase of this crisis.And that is what will make the difference, purpose and passion and modulation and keeping close to our customers. Very close to our customers. And financially, that we are in a strong position. This will also make a difference. Can and we are protecting our cash flow targets. We have ample liquidity and no meaningful maturities and we're taking quick decisive and relevant measures to accelerate the leveraging.The next few months will be challenging. We know it, we don't want to sugar coat it to you but we have really quickly refocused the business to, one, protect our employees; two, keep our customers and the communities connected, keeping our market share and positioning ourselves for a quick rebound and three, preserving our cash flow. It is as simple and as focused as that. If we do this well, we will strengthen our brand equity and value for the long run, and we'll be positioned to rebound very, very quickly.And this is important because this crisis will pass, and we will be there, and our uses will be there. We will be closer to them. And what will ultimately matter is how we behaved in this process towards our consumers. And with that, we'll take some questions from you.

Maria, we're ready for questions.

Thank you [Operator Instructions]. Your first question comes from the line of Johanna Ahlqvist from SEB. Please ask your question.

I think, I have two, three questions. The first one if I get you correct, you aim for flat OCF for 2020. And I'm just wondering, does that also include working capital? Because I guess you will face quite what the risk is at least that you will continue to have a negative working capital throughout the year given the payment terms for customers that you discussed? The second question relates to, if you can say how much of data top-ups that are done through digital channels today? So if we can get sort of the base, is it a minor share or any flavor on that would be helpful. I think I'll start there.

So I'll take the second one and then perhaps, Tim, you can provide some color on No. 1. It has doubled the amount of digital top-ups have doubled in just a few months. But it's still a very minor percentage, around 5% or so still so we're seeing continuous improvement, but it's still a very slow base. Prepaid is still a physical distribution of business. Now we're ahead of our competition, but it's still low numbers.

Yes, and on the working capital point, Johanna, it is complicated. I accept that. We will see working capital move around a lot. But we are seeing some offset there. We've pushed payment terms out with large suppliers. So there is a balancing impact taking place on that. Our inventory will run-up a little bit as we go through the summer, but it will come down toward the end of the year. So I don't see any impacts on that. So although it's very difficult for us to predict at this stage. I don't expect to be a defining feature for us for this year.

So just to maybe make that clear. Do you aim for a flat OCF 2020 over 2019?

Yes, we do aim for that over 2019, but look kind of it's an aim, not a promise. It's kind of there's a lot of moving parts for us. It's allowed us to [indiscernible] the organization around the target, which is achievable. And focus where revenue is tough at the moment. It is very important that we focus on the cash flows. And I think that's what we're doing internally and externally. And there are some variables that are outside our control, but the ones that are inside our control, we are targeting to focus on the OCF in that way.

Let me add to that, Johanna, because you're sort of focusing on something very important. Thank you for that. This is a pretty bold statement we're making, quite bold because we don't hold any particular crystal ball here that's better than anyone else's. But we see the importance of saying to all of our shareholders that we are aiming, and we think we can protect that operating cash flow target for the year. It's a pretty bold statement, and it just gives you an idea of how focused we are on that. Give us some wiggle room, we have no crystal balls. But it is a very important target that we set ourselves to protect our investors.

Your next question comes from the line of Stefan Gauffin from DNB Bank.

Yes, a couple of questions for me. First of all, on the cost savings, you talked about that you had some savings coming. So I think you're aiming at the subscriber acquisition cost due to lower churn. Is that included in the $100 million cost savings? Or is that coming on top? Secondly, you talked about that Paraguay was impacted by a high commercial activity in the quarter. How has that developed after the COVID-19 crisis hitting the market? And then thirdly, you had a very different performance in Colombia versus your peer, America Movil in terms of subscriber development and service revenue development. Can you elaborate on this difference? Thank you.

So why don't we do this joint team because there may be bits and pieces that you may have just add to this. And thank you, Stefan for the question. So first and foremost, what we call the replan, by the way, for the year, that's the internal work we use for it. On the OpEx part of it, which I think is your question, not the CapEx, which is we're at least targeting $100 million. It's a straightforward question. The larger part of that, 50% to 60% is a reduction in commercial activity.So it does include lower churn, lower activity, less structurals and field services, lower sales commissions, lower sales subsidiaries, lower marketing and advertising spend, of course, which is significant. So it is indeed all included in there. There's an additional element of that some 20% to 25%, which is direct savings. So that's programming, bandwidth, etc. As you can imagine, we're working with our vendors to help and chip in, if you will, during the situation.And the rest is G&A and other stuff that is very important. So hopefully, that gives you a lot of color on number 1. Number 2, the straightforward answer on Paraguay is life or the commercial aggressiveness with the COVID, if there's a silver lining to this is that we're not seeing the impact on profit and continued competitive aggressiveness, quite the opposite. The reaction from our competitors has actually been to roll back their network rollouts to be much less aggressive on the marketplace and focus on also just protecting the business. But we're not seeing a continuation of an aggressive commercial activity in Paraguay. And that's good because we don't have to battle two fronts at the same time.I hope that answers Paraguay quite completely. And then in Colombia, there's…

Thank you. Your next question comes from the line of Soomit Datta from New Street Research. Please ask your question.

One is maybe a bigger picture question, which is we've seen a number of Emtelco's report now. And I'd say the commentary from yourselves and the outlook seems to be much worse than we've generally seen in the sector. So questions that I've had this morning are, is there something specific about the Millicom markets which is meaning that things are worse here. Obviously, you -- I guess the main point you're making is lockdowns are impacting businesses. But those lockdowns are happening the world over. So what is it, which is really having such a dramatic impact that may be isn't happening elsewhere. And I referenced America Movil, we heard from yesterday and things are definitely tough, but they seem to be much better there. So if you could help us understand that would be very helpful. As a first question. Maybe I'll ask that, and then I can come back to on the one.

Well, you can imagine that we have been questioning ourselves quite a bit. Is our view overly cautious or overly green viz-a-viz perhaps a story that others are painting out there. I think there's an element that we simply do not like sugar coating things, and we would like to preserve our credibility. There's an element that we do think things are going to get tough in our markets, and we'd like to call it earlier rather than late. Even if that causes this gap in perception.But there's also an element that our markets have had much, much stricter lockdowns. And some of them started very early. If you look at the base of the lockdowns in our markets, they started earlier than they did in some of the markets, even in the U.S. We're very attuned to it. And there, the word lockdown is perhaps not correct. These are curfews. These are 24-hour curfews with the exception of Nicaragua and Guatemala in which people are not allowed to even walk their dogs on the streets. I'm not making up this. This is the way it is. You can go single person, you cannot be double person in some of these markets. So these are very, very strict lockdowns.And I tell you, we see the correlation immediately. We have network tools that allow us to from the network see the mobility in our market and the correlation to toot and the correlation to use. And it is a very, very strong collation. Now there are some differences across jurisdictions. Some of our competitors do operate in markets that have not had this very significant lockdown measures.Speaking of the countries themselves, Mexico has not had a lockdown. And Brazil, as you know, has not had a lockdown. So there is a difference between the approach our regulators and our governments have taken. And that may be permeating our own views on this. As I said earlier, this is all about the lockdowns. The minute we see the lockdown is off, like we've seen in a couple of days in Dudas, we see top-ups immediately come back up.

I think, Soomit, if I can just add in here. A lot of our competitors have reported have been reporting backwards, kind of as we have seen, only seen a couple of weeks impact on Q1, which is not that impactful on us whereas it was effectively 0.7% or $10 million. What we're trying to do is give you a picture of the future and giving you what we're seeing in equal. And as Mauricio said on the call, April has got instrumental, so it may not be representative of the future.But we are we can't bank on that. And therefore, we have to prepare the business for what could be a significantly long extended period. Once the lockdowns have gone an extended period where we have to put the business in the right place in order to weather that storm. We have a strong market position. We have a strong business, but we have to put it in the right place for that, and that's really why we were giving you this indication of what we're seeing currently.

So this has been an internal debate. And luckily, we have a Board that's been very supportive of our view. If we're being overly cautious, great because we're protecting the business. We're doing all the right things. But everything we're doing, we are preserving the ability to come back really, really quick. If you read the CEO letter, if you read our prepared remarks in detail, we're keeping the teams. We're keeping the commercial distribution. We're protecting those, which are peaking the strategic projects so that we're ready for a strong comeback.So should it be that in these things are not as grim as we think they may be, and we'll be ready right there for the comeback, having protected the subscriber base, the business, the liquidity and our teams. That's our strategic approach. And I really thank you for this big picture question because it does allow us to tell you what we're doing and why we're doing it. We think we're putting ourselves right in the middle of protecting the business, preparing for the worst by being really ready to come back very, very quickly.

That's really clear, and maybe I mean, just as a follow-up, it sounds like the biggest factor is the lockdown. And again, so it's been stricter and maybe a little bit longer in those countries. So that's maybe a differentiator. But presumably within, and hopefully, within some weeks or a month or so, you come out of lockdown. And the guidance you've given from April suggests about a $30 million hit to revenues. So you have a couple of quarters, or sorry, months, I think that is. You have a couple of months where you lose $30 million, $60 million. I guess the response seems somewhat disproportionate. You've cut the cash returns by $250 million. And you're cutting CapEx by $200 million to $300 million. You're looking for CapEx savings, I think, maybe $40 million to $50 million away from the commercial savings. So if we're going to bounce back from these lockdowns, isn't the response, but if the lockdowns are the bigger driver, isn't a response on the sort of cash flow side somewhat disproportionate?

Well, I mean we have other factors as well. We have an FX impact in Colombia and Paraguay at present time. We have still around about 35% to 40% of our revenues are coming out of prepaid. We see already slowdowns in remittances. As Mauricio said, I think this is a better position for us to be and to be slightly more prudent now and then maybe prudent long toward the end of the year when it's easy for us to change direction again. But if we did it the wrong way around, it would be very difficult for us to manage the business.

Yes. So I think our principles, we're going to protect our operating cash flow, that we can do and are doing and we're going to be very, very cautious on protecting liquidity. I think that's the most important, savviest thing we could do and the most prudent thing we could do. Now I don't know that we can call the moment when things are going to go back to normal. And that's why we need to be more cautious. We just do not have that crystal ball. And we're not approaching it in that way. We're approaching it in the sense of protecting the operating customer, being cautious, preserving the liquidity because we do not know when things will go back to normal, and I think that's a key point.

Your next question comes from the line of Marcelo Santos from JP Morgan.

Good morning. Good afternoon. Thanks for taking my question. Hope all of you or families are well. The first question is about the SME exposure. So you mentioned that SME taking relatively large it how much of your revenues broadly are exposed to segment? That's the first question. And the second question is about the potential Costa Rica you're not closing. If the conditions are not so fueled tomorrow. How much of the synergies that you attributed to the acquisitions? Do you think you would lose if you don't have the potential, you would lose if you don't actually close that deal?

Should I deal quickly most with the small business because I did mention in my script, we see about a 7% free through contribution from small businesses in the Latam service revenue. So it's 7% of our Latam service revenues. It's noticeable, but not meaningful, I would say.

Perfect. Thank you.

Yes. So we didn't quantify the synergies per country for the Costa Rica acquisition. Perhaps the most important thing I can say is as much as we would definitely want to uptake on mobile in every market we operate, and that's always been part of our strategy. At this point in time, it's a lot more prudent given that we have the absolute legal right not to go forward, not to extend in terms of that contract or not to go forward. It's really a very sound and prudent business decision. The largest synergies by far were in Panama and are being attained in Panama rather than in Costa Rica. As you very well know, our business in Costa Rica have been very factual here. Our existing business in Costa Rica is relatively small.

Thank you. Your next question comes from line of Cesar Medina from Morgan Stanley. Please ask your question.

Thanks so much for taking the time to discuss the results. I have two questions. First, a follow-up on Costa Rica. Can you please clarify or as much detail as you can possibly provide? What are the specific hurdles that present for the transaction to be closed? And then second, throughout the call, you have mentioned you expect a strong come back eventually, et cetera. Then maybe clarify the comments pertaining to the long-term goals that you have been reviewing them? And where is the risk in the reset your long-term goals go over or under what you were expecting before? Thank you.

So listen, on Costa Rica, and thank you all for the questions. I'll try to address them here with a little help from my team. So a little bit on the Costa Rica. And so for your clarity, as you can imagine, these are contracts that are very heavily negotiated in New York. They're black and white. They're clear, they're agreed by the parties. Like every standard contract, they have provisions on what approvals need to be attained, and they all have a long date on them. So there's this contract.Ours has a set of regulatory approvals and a process for the regulatory approvals that are to be obtained by May 1, tomorrow. And after May 1, the party has the right to terminate basically not to extend the contract. We've been very clear that if all those regulatory approvals are obtained, we will fulfill our obligations, and we will close, no doubt about that. But if they're not, we have the availability, and this is crystal clear. As just an [Indiscernible] not to extend. And those are regulatory approvals, so it's a number of the M&A process have not been obtained as of today.If they are attained before tomorrow, we'll go ahead and close. Of course, if they're not attained, we will and have notified Telefonica that we will not extend. As I said earlier, it's the business decision that we think is best fit to the time that we live in. And as I said earlier, it's just the right prudent business decision for us to take.Now Telefonica company have a different view on what their legal rights are. And if they do and they wish to proceed in court in New York. Of course, they have the right to, and we will defend our rights there because the contract is black and white. So that's the Costa Rica bit of it. I do not write number two, but I'm sure Tim can help me on that one.

Well, it was about the long-term goals and kind of where they have changed. And I'll give you my quick to benefit. And in a sense, no, they haven't. Obviously, we need to be cautious at this point in time. But in many ways, I see the demand for our product enhance out a bit rather than diminished. I mean, I think what everyone around the world is really likely is the importance of broadband. And we are the provider of broadband currently to 11 million households in the footprint area. There are 30-odd million households in our markets. And we see no reason to see why that would diminish over this time, if anything, possibly enhanced. But, I don't expect the same view.

The only thing I would add to that, and I hope this comes across possibly is we expect to lead the comeback in our markets. We expect to be strong in our position once the crisis is over at all levels, the employee teams in place, the operating cash flow protected, the balance sheet strengthened, the commercial terms cap, the network deployment is also ongoing. So that we can lead our markets when the recovery is there for us.This is a matter of timing. We do not want to be ahead of where our markets are. But this doesn't make sense. We just need to be ready for when they come back, and we will bounce back quickly, swiftly, and we will lead that comeback. We just don't know exactly when it's going to happen.

Your next question comes from the line of Bill Miller from MAI Hartwell.

I'm glad you're all safe and sound. Getting back to Costa Rica. How much do you save by not going forward with the acquisition? How many hundreds of million?

Yes. So the purchase price is very public. It's just a little north of $570 million. Obviously, there's a little bit of a chip there in our buildup of mobile over fixed in Costa Rica. But as I said earlier, these are times when you got to make the sound business decisions. And this is without his attention without the right business decision to make. So the number bill is $576 million, I believe, is the exact number. I may be corrected, but somewhere in there.

And secondly, in the larger context, with a strong balance sheet, with the No. 1 or 2 market share acquisitions in most of your markets, how are you going to take advantage of that? Will it be others? That fall by the wayside and you can pick up their asset free for nothing or Tim, you said you're going to be able to grow faster than you had been able to grow historically. But how much faster and do you think it's because competition will? Or how do you make that statement?

Yes. Listen, a couple of things will definitely occur here. People will be competitors that it will be a lot more cautious with their returns and demand on their capital because there will be much more pressure by their own liquidity constrained in their less strong balance sheet. So some of the existing competitors indeed will have to ease off their pressure, change their plans, ease off on the roll out plans.And as a result of that, and we do believe that there'll be a better industry structure coming out of this. It always happens. Now we're one of the stronger ones out there. And as a result of that, everything we're doing positions us for that. And I also believe, and I strongly believe is that regulators will also change their views. And as what I said in my prepared remarks. Because they are realizing right now, as we speak, that it is a stronger company, the multinationals with the ability to invest and be there for the consumers that are the best, best for them to keep for future times in their markets. And I do believe that this will cause them to understand that much more than they have before. Those two things, I think, will lead to better industry structures.

Your next question comes from the line of Sergey Dluzhevskiy from GAMCO Investors. Please ask your question.

Looking at your markets, obviously, you have touched on this already, but as you look at the range of your markets, niche markets, do you believe have had the most effective response to the pandemic? And which markets do you worry somewhat as you look at the events unfolding.

Well, I have to be honest with that, and somebody has a better answer. I think time will tell in just about every country in the world, not just our own markets, whether it's severe lockdowns where the better public response, public policy response or whether a light-touch response to lockdown-wise the better market response. With our responsible add on, I do not know the answer to that, and I don't think just about any policy maker around the world knows the answer to that. We're looking for it, I tell you. In a year, two years from today, we'll all look back and try to figure out what was the smarter way to go about this. And this is true, not by market just for every market. I don't want to step in the shoes that are bigger than the ones we can fill.

I think it's fair to say. But the government is reacting very quickly to this. I think they all, by and large, we acted fairly quickly to we cross our fingers and hope that's a good solution.

And one more follow-up on Costa Rica, I guess, from kind of market dynamics and competitive landscape there, assuming that you don't close on that acquisition. So the fact that you won't purchase mobile assets there, does it mean that you would look for an MVNO agreement in that market? Or how would you look at Costa Rica without mobile assets there? Would you look to exit that market? Just your overall assessment, where you stand in Costa Rica, if you don't close on that transaction?

I've always said, we've always said that, of course, we think fixed and mobile in a converged environment leads to an enhanced strategic particular, no doubt, and this has not changed that. But I have also said that I am happy, we're happy to have cable stand-alone because cable stand-alone is very resilient. You're seeing it through the crisis. It does not immediately need a mobile solution, and it does hold the stronger long-term strategic part because those mobile, those networks are very, very resilient and capturing the bulk of the topic. So we think with cable stand-alone, we're in a good position and a good strategic position to evaluate other options, which includes the ones you're mentioning.

And my last question is on kind of non-core, non-strategic assets. So obviously, you have mentioned a lot of measures to improve cash flow and liquidity, but you didn't mention kind of dispositions of some assets that you have, which I believe are always an option. So you have a stake in Helios Towers, you have JV in Ghana. What are your thoughts on the timing and the eventual monetization of some of those nonstrategic assets?

So two quick comments on that. Of course, those are out there, no doubt. Whether it's Tanzania or HTA, no doubt they're there for options. Number two, we have a ton of liquidity. It's $2 billion plus measures. Internally, I call it to the team the big bazooka. And I basically tell, it is important that we go into this with the biggest bazooka we possibly have because we don't control the timing of this at outside, but we can control how big a bazooka we have. And it is big. It is really, really big. And what I tell the team is we need to know that because then that would allow us to make all the commercial people, strategic decisions with the ability to not be constrained by that.Now big bazooka is really, really important for us to have peace of mind. Now with all that in the mix, the things that we've shown you today, I believe that we can act on that we have acted on that are within our ability to decide, not the ones that may or may not happen, which they may or may not happen. So that we can give you certainty on what the bazooka is today and how much we can add and are already adding on decisions to the bazooka. And that's what we wanted to highlight to you today.

Thank you. And your next question comes from the line of Lena Osterberg. Please ask your question.

I have two questions, if I may. First of all, as I understand it, the impact that you've seen now early April and you expect on service revenue decline that's been mainly related to market closures and constraints because of COVID-19. So if market starts to open up, and people can move around freely, do you expect an improvement? Or do you think that the next impact will be the hit on the real economy? In that case, when do you expect that to come? And how big will that impact be? Also, it would be very interesting to hear what you're seeing now in Colombia with consumer confidence dropping massively on the oil price decline? And how you think that will sort of translate over the next couple of months for your business as well? And then also on cash flow and liquidity, it is indeed a big bazooka that you're building up. So I'm just wondering how scarier scenario should we expect, given the size of liquidity that you're building up now?

Perhaps, Tim, I'll defer to you on the FX and on a matter for bazookas, not only are you an expert in on that, but some of the measures that you've been taking in the last few years have made a difference on our balance sheet. So if you want to start with that one, and then we'll go to...

So look, kind of the big impact we've had is be in Colombia. And obviously, that currency has devalued by 22% year on year. So it's now trading at 4,000 and budgeting at 3,400 for this year. We're not expecting 4,000 to change materially. But it's not going back anytime soon. I mean, you guys are better judges of the oil prices. And this is not looking like it's going to recover quickly. So we're preparing for a world where we are around about 4,000 in Colombia.Paraguay's had a little bit of a hit as well. Central America, on the other hand, has been very solid, but these economies are very dependent on remittances. We're already seeing remittances down around about 10%, but that could have an impact, it may not. And the global financial crisis, the as some devaluation, it actually wasn't in the Colombia levels, but we don't know, Lena, and that's why we're taking these actions the sort of when you have uncertainty, you need to be prudent, and that's why we're doing this.

Yes, I think I'll build on that to tackle the other parts of your question. The answer to both of your questions is actually, you're correct. Yes, the lockdowns have a significant impact. The minute the lock counts go away, we'll see immediate renewed consumption of mobile. That's true. But it is also true that these markdowns are having as meaningful impact on the economy. And that macro effect, I don't think we're seeing just yet.That's still to happen, both in you're true. And obviously, the longer the lot tons stay on and the more pronounced they are, the bigger that impact will be. And what you're hearing from us, which I think is a responsible thing to here, quite honestly, is that we do not know when or if these lockdowns will be effectively lifted, whether they'll come back, on what the response to this pandemic will ultimately need to be. And it is a responsible thing to be very cautious in this environment.I think Tim said it earlier, I've been adamant with my team, I've been adamant with my board that you had a crystal ball and I knew exactly what the damage of the economy is today. And if I knew exactly that it is over, and that we've gone now already into recovery mode, I will be taking a different view. But no one knows that. And as a result of that, the responsible thing to do is to tell you, we can protect the operating cash flow, and we're going to move to do it.And we're going to build, I'm going to keep using the term because it seems to have a [indiscernible], a big bazooka. We do need it, we do want it. What I tell the team on and on is if you're going into a dessert. And you do not know if you're going to be in it for a day, two days, a week or three months, you put as much water into your jeep as you possibly can. And that's what we're doing. And I hope you get that because I think it's a responsible thing to do.

And Mauricio, I think the other thing, which maybe is important to distinguish here between developed markets and developing markets. Most of our customers, most of the people in these countries are not salaried. They need to go out to work, they need to go out to get cash. And if they don't work, they don't go out, and they don't have disposable income. And clearly, they need disposable income to buy our products.

I want to say an obvious thing also because I think this is part of the big picture that we're talking. And it's important that we understand our approach to this. If indeed, we're being overly cautious. If indeed, we have built a big bazooka, perhaps too big. If indeed, the lockdowns ease off next week or next month, and there is a way for the economies to come back quickly and strongly. No harm will have come to us at all. I want to be very clear to that. Because we've kept the teams, we've kept the commercial distribution teams.We're keeping the strategic projects, and we're ready to bounce back immediately. Immediately, and this is what the teams have heard from me. So no harm will come to us. But because we don't know that, that is necessarily the outcome. It just makes such business strategic sense to protect ourselves. And if it is longer, we're going to be the strongest if it lasts longer. That's our strategic mindset. And I am convinced this is the right approach.

And I just have a follow-up on that. So the cash flow boost that you're getting from all these actions and potentially by not doing the Costa Rica acquisition. Should we see sort of that you expect a negative cash flow in the similar magnitude?

To the similar magnitude to what?

To the savings that you're doing. Because you're doing them to offset something. So are you assuming that you will have a COVID-19 will be a $550 million hit on your cash flow. If you didn't do these things.

I don't think you can assume that, but I don't think you can see that. I think the way we've looked at this is to say that one of the leaders we can pull today, which either we're not down in the business or are frankly not required because there's no one out bet to buy the product. And that's what we've done. And we've pulled back hard on those levers. And we have pulled back hard on the capital distribution piece, all of these things, ultimately, we can reverse. But at this point in time, with the lockdowns that we're seeing, with the macro impact that is on the way. The fact that our economy are cash based, we think it's a prudent thing to do. And to echo Mauricio's points, we're going to sort of manage this ship to where the wind is blowing, and we will move it. We're moving it besides to daily or weekly. So it's really to make sure we can order this in a strong place.

Well, not surprisingly, we spent more time than we normally do. And thank you for all your big picture questions. They've given us an opportunity to tell you how we're thinking about things. And I think that's more important than anything else. I don't want to tell you that the team is extremely motivated, really focused. We've never acted more tightly and more swiftly. It's one of our strategic advantages. We can react and adapt very quickly with a very, very efficient team.We're doing the things that we think are right. We're keeping our subscriber base, and we're keeping it close, connected and enhancing our equity brand value with them by protecting them. We are keeping our operating cash flow targets to protect you as investors. And we think the right thing to do here today is to adapt to create more liquidity to help preserve our strong balance sheet, the big bazooka that we're talking about because we are uncertain about the longevity of this crisis, but very optimistic and very certain about the future.We talked about that, and we talked about Phase 3 during our prepared remarks. We're really diligently preparing for that. There will be good changes. And all of those changes point to those diesel highways that we'll be building being more essential than ever. If anything has come out of this crisis is that there will be a renewed enhance not to turn back digital wave in our markets. And we are doing everything to be on the one hand, cautious. But on the other, really, ready to bounce back and lead that recovery. Because we think the approach that we're taking will make us emerge even stronger than we are today. And I hope you appreciate that our strategic plan stands makes a lot of business sense.Thank you for dialing in today. I hope everyone is staying safe, you and your families, and we look forward to interacting with you continuously. Thank you.