Digi Communications N.V. ($DIGI)

Good afternoon, ladies and gentlemen. Welcome to our first quarter 2026 results presentation call. I will try to explain or guide you through our results, helped by Marius Varzaru, my colleague from Spain; and Dan Ionita, the Group CFO. So let's go into the slides. We had an outstanding quarter with EUR 583 million of revenues in the quarter, a 10% growth year-on-year. RGUs exceeded 33 million units in the first quarter, 15% growth and again, an increase of more than 4 million RGUs year-on-year during the period. And EBITDA growth of 15% EBITDA excluding operating leases, reaching more than EUR 160 million from EUR 140 million 1 year ago. Romania, our largest most mature core market grew at 9% its RGUs. Mobile customers exceeded 8.2 million units, 20% year-on-year growth, very impressive figure. Pay TV continues above 6 million for the second quarter, including both cable and satellite operations and broadband at 5.2 million RGUs with 5% growth. Spain has increased overall and with mobile being the largest growing segment -- sorry, the largest segment is 7.6 million units, 22% growth. Broadband, the largest -- the fastest-growing segment with 2.8 million RGUs, 30% growth and fixed telephony 900,000 units. Overall growth impressive 26% year-on-year. Going on, we continued on doing what we do best, developing the networks, improving the current network that we have and of course, increasing the number of users, increasing the penetration or the usage of these networks across all our markets, Romania, Spain, Portugal, Italy. Our intention is to continue consolidation of networks and operations in Romania, further expansion of both fixed footprint and mobile footprint in Spain as well as consolidation of our operations in Portugal. I think this is our key focus, and that will continue to be our key focus going forward. And of course, we are continuing to concentrate on the new markets, Belgium, and we've just announced starting operations in U.K. and we will touch a bit on this later. So just to run quickly through our most recent developments, most recent events. We have published annual accounts at the end of April. And together with the publication of our results we did announce the management proposal to offer a dividend of RON 0.5 per share after the split. So on a like-for-like basis, it will be RON 1.5 in comparison to RON 1.35 a year ago if we were not splitting the shares. But of course, with the share split, the dividend is 3x smaller, but overall, an 11% increase. So I just did mention and mid-March, we did close and we did announce a 51% ownership in Whyfibre Limited, a U.K.-based company. This partnership will allow us to develop networks, fixed networks in U.K., and we intend to launch test services on a pilot basis in the areas north of London. Actually, we have started and we will continue the pilot that we started in the recent few days. Yes, let's go on. And yes, we're coming back to the numbers. And overall sales, EUR 583 million, EBITDA over EUR 160 million, as mentioned a bit earlier. EUR 127 million of EUR 160 million comes from Romania, EUR 50 million in Spain, continuous number more or less from Q4, expected to increase going forward in line with our announcement, and Marius will discuss this more as we discussed. And an improvement in EBITDA loss EUR 16 million in Q1 this year, better than in Q3, Q4 last year for Portugal. As I mentioned, an impressive figure of 33 million RGUs, more than EUR 20 million in Romania for the first time historically and Spain at 11.4 million RGUs. Just a few numbers. In a nutshell, again, just coming back to the financials, EUR 584 million revenues, 10% up from EUR 532 million a year ago. EBITDA, including IFRS 16 numbers, EUR 194 million, up from EUR 170 million a year ago, a similar increase of over EUR 20 million, again, in line with growth of EBITDA, excluding operating leases. CapEx, EUR 156 million, significantly less in comparison to Q1 last year at EUR 179 million, in line with our expectation for further CapEx decrease, just like we discussed in the previous call when we're discussing the Q4 results. So EUR 771 million in CapEx that we recorded in 2025 was a significant decrease versus '24. And this year, we are going to have a number in the low 700s for total CapEx. So all in all, the numbers are in line with our expectations and in line with what -- with our strategy. Just a few words on RGUs. Mobile continues to be the largest or is the largest and continues to be the fastest-growing segment with 21% growth rate, of course, helped by Spanish operations and Romanian growth primarily. Broadband remains the second largest segment with 13% growth. And Pay TV continues 5% growth with 6.4 million RGUs in comparison to 6.1 million RGUs a year ago. The largest growth comes from Spain this time, not Romania. In Romania, both our market and our position is very, very mature. So we [indiscernible] our colleagues for Spain with 26% growth, and Marius will dive more into details describing these numbers and overall the Spanish operations. Other than that, Romania grew by 9%, Portugal added 20% to the customer base, reaching 905,000 RGUs in Q1 from 755,000 RGUs a year ago. Of course, the fastest-growing segment is Mobile and followed by Broadband, more or less like in other markets that we operate in. Just a very few words on portability because this shows the health of our growth and health of our development, both in Romania and Spain. And as you see, most of the growth and additions is backed by portability results. In Romania, we had a gross portability of 188,000 users in the first quarter. In Spain, gross portability of over 416,000 RGUs and net portability of almost 200,000 RGUs, a very positive dynamic and basically showing the superiority of our offerings and our engagement with our customers in both these markets. Going on, I will ask Marius to continue and discuss our Spanish results.

Thank you, Serghei. Hello, everybody. Glad to be with you today and to share the results and the progress of Digi in Spain. We had another excellent quarter, Q1 2026 of growth for Digi Spain with accelerated growth both for fixed and mobile services and expansion of the SMART network footprint. The speed of deployment of the FTTH network continues to be high. In the first quarter of 2026, we rolled out more than [indiscernible] homes passed, reaching a total of 14.2 million homes passed. And our goal is to continue to deploy and reach a footprint overall of 21 million homes the latest by 2030. As you know, our most important critical factor of success in Spain is the deployment of FTTH networks in a vertically integrated model with our own employees. This solution of deployment allow us to roll out and to operate on a daily basis, very good quality networks, to deploy a future-proof network with best available technology XGS-PON and also based on the economics of scale, synergies and cost efficiencies to achieve very competitive economics, both for CapEx and OpEx for the network. So in this sense, by the end of the quarter for the whole 14.2 million homes passed SMART footprint reached an overall historical average cost of deployment of EUR 50 per home passed, a very competitive cost, less than half of the historical cost of deployment of our competitors in Spain. On the bottom part of this slide, you can see how the constant evolution of the take-up of the SMART footprint reached 16.3% level by the end of last quarter. On the top slide -- on the top part of the slide, you can better interpret this blended average take-up by the individual penetration rate for each of the cohorts depending on the year when they were built. Our SMART footprint commercial operator generates growth in all cohorts, the initial ones of 2019 and 2020, which reached levels of penetration of 28% and 25% by the end of the quarter. Also new cohorts continue to benefit from higher take-up and faster ramp-up compared to the initial cohort. In the initial cohort, we were starting with 3% penetration in the first year, the new cohort start with 6% or even 7% for the last cohort of 2025. And lastly, for this slide, the SOTA network deliveries continue to be ahead of the initial plan, and we've reached 5.6 million homes delivered already. The remaining 375,000 homes will be delivered until the end of this year and also EUR 131 million of cash inflows will come from SOTA for the next 3 quarters. On the next slide, we can see how the great results in terms of deployment of network reflect in our accelerated growth momentum in Spain, consolidating the already best year of net growth 2025, both for fixed and mobile services. We are the market leaders in terms of net gains for the past 17 quarters consecutively, both for fixed and mobile services in Spain. For fixed broadband, we reached 2.76 million customers with a growth of more than 175 net adds in the quarter, which is the best historical net growth quarter. 100% of the net growth during the last 9 quarters came only from the SMART footprint, 100% of that. So benefiting from the competitive products we launched back in October 2024 for this footprint reflected also in the gradual decrease in ARPU as new customers joining in Digi are subscribing products with more competitive prices. We are the third B2C fixed operator in Spain already. And in a couple of months, we will become the third fixed broadband operator in Spain overall. We reached a market share of 13.9%, with an impressive increase of 2.8 points of market share during the last 12 months, which is actually achieved only as I mentioned before, in the SMART footprint, which covers only half of Spain, meaning that in the SMART footprint area, we are growing at an impressive pace of 5 points of market share per year. This reinforces our determination to continue to expand the SMART footprint towards the 21 million goal and replicate in other areas of Spain the commercial success of the existing cohorts. For the mobile services, we've reached 7.58 million mobile [indiscernible] with an excellent quarter of net gain as well of 312,000 net gain mobile [indiscernible], out of which 80% being convergent mobile [indiscernible]. In the next slide, we can see how the constant growth of the revenues over the last 5 quarters is reflecting the mix of [indiscernible] customer base growth and ARPU dilution due to the more competitive offers we launched in the last quarter. And on the bottom part of the slide, we are presenting the gross margin evolution both for fixed and mobile services. So fixed broadband, for example, for the last 5 quarters improved -- the margin improved due to strong operational leverage, expansion of the SMART footprint and the increase of its penetration rate. On the mobile side, the margin evolution for the past 5 quarters, as you might remember from previous presentation is determined by a couple of moving parts. First of all, starting from 1st of July last year, the new model of mobile telephony caused the MNO economics as we call it, started to apply, improving significantly [indiscernible] Q3 2025. Then Q4 2025, the margin decreased as an effect of the latest commercial offer update from September 2025. And lastly, in Q1 2026, as anticipated in our previous call, a step-up of EUR 4 million per quarter compared to previous quarter of fixed costs related to the expansion of the mobile network started. Most of the transition of the MNO economics model is well advanced and going forward for the next quarters, we do not foresee any further downward impact on the mobile telephony margin. And continuing to the next slide, we can see the evolution of the adjusted EBITDA ex operating leases for the last 5 quarters and how this is reflecting both the -- effect of both fixed and mobile gross margin evolution. Starting with Q3 2025, we clearly see the effect of the new MNO economics model and in Q4 2025, the effect of the latest commercial offer for updated in September 2025. And then in Q1 2026, we see the effect of the step-up of this fixed cost for mobile networks expansion of EUR 4 million compared to previous quarter, leading to a slight growth of EBITDA compared to Q4 as we already anticipated during our last call. For the rest of the year, we expect constant growth for EBITDA for each quarter, in line with the guidance for 2026. And all in all, an excellent quarter of growth for Digi Spain with record net adds confirming our strategy for continuous growth for the years to come. Based on the expansion of the market [indiscernible] up to 21 million homes and with almost mechanical type of constant growth of the customer base on this footprint towards the 25% penetration levels we already seen in the initial cohort, which paired with our significant operational [indiscernible] lead to a strong potential for improved profitability. And now, Serghei will continue the presentation with the financial profile.

Yes. Thank you, Marius. Yes. total gross debt close to EUR 2 billion, net debt EUR 1.9 billion. Net leverage ratio 3.15x. Repayments very small this year, EUR 57 million and repayments of EUR 284 million during 2027. All in all, just as we were discussing, we think that Q4 numbers were the highest in the recent history going back and also going forward in terms of leverage. And we are on the path of delevering our exposure -- our financial exposure. As we said towards less than 3x by the end of this year and towards less than 2.75 by the end of 2027. This almost concludes our presentation. And as a summary, we are continuing our day-to-day work in Romania. We've said it many times, we are very large. We are mature. We have consolidated presence, but there's always opportunity and possibility to improve our operations through efficiencies and other enhancements and we will continue doing so while trying to increase the penetration and usage of our primarily mobile but also fixed network. For Spain, as Marius has said, we concentrate on expanding further the fixed and mobile networks, and we are aiming to continue the growth and enhancements -- large investment in profitability in line with our end of 2025 and further. And, of course, to concentrate on the new markets to improve efficiencies and scale in Portugal, but also to help continue starting the services in Belgium and U.K., the most recent addition.

So I think we are now at the end of the presentation and we kindly invite you to submit your questions in the chat box, and we will read the questions and we will try our best to answer. So the first question comes from Daniela. Q1 2026 revenues rose 10% year-on-year. Is this a fair run rate for full year 2026? Or should growth accelerate in coming quarters? Well, thank you for the question. It's -- we have a mixture of geographies. Some of them having significantly higher growth as we have shown on the slides. And then we have Romania, which is a very mature market. But I'd expect 10% still to be the lowest boundary for growth. So I'd expect growth to be -- to exceed 10% during 2026. Of course, helped by the growth markets most and then by the Romanian operations. Our Romanian operations due to their size, of course, affect these results significantly. The second question from Daniela. RGUs grew strongly, but ARPU declined across key markets. Should full year 2026 revenue growth remain mostly volume driven? Or do you see ARPU stabilization? Well, we have always concentrated on volume growth and not ARPU management. So for sure, this will remain the base -- the foundation and the base for our growth going forward, including 2026. Now ARPU declines vary market by market. In Romania, these are mostly the result of ForEx devaluation that took place in -- around May, June last year. And in -- we have also another series of devaluation that took place in -- recently in the last 2 or so weeks. We'll see how we address that. For Spain, there was a certain price adjustment and certain change in behavior of customers resulting in ARPU decline. For Portugal, ARPU decline is driven by conversion of NOWO customers to Digi products, which generate smaller fees. But all in all, I think this is all in line with our expectations, and we don't see any negative development on this side. And again, as always, we concentrate on volume. Third question from Daniela. Romania revenues rose 5.8% year-on-year. How should we model full year 2026 growth considering mobile RGU gains, [indiscernible] prepaid and ARPU pressure? Well, we still continue growing in Romania, but probably the level is in the low percent. Yes, difficult to say more. But having said this, we will continue growth in Romania as well. The question number 4 from Daniela comes is for Spain. Spain remains the main growth engine. Should it's EBITDA margin keep improving in 2026? Or is further expansion likely to be limited? I'll ask Marius to address this question.

Thank you, Daniela. EBITDA margin will continue to improve. We already provided guidance for 2026 and for midterm for EBITDA. So the guidance continues to be valid. And in this sense, for 2026, we were providing guidance for low 20s consolidating the margin for the second quarter -- the second semester of last year. And for midterm on EBITDA margin that we think that it will reach about 30%.

So let's move on. Two more questions from Daniela. Question #5, group adjusted EBITDA margin improved despite softer revenues. Is the Q1 margin sustainable for the rest of 2026? Well, I disagree with soft revenue growth. I mean, 10% is, I think, a very good result for the group level, again, given the very mature market that we have in Romania. And as we -- as I described before, for sure, we consider the Q1 margin is both sustainable, and it will improve, primarily helped by our Spanish operations, but not only because we are working to improve further our position in Portugal, and we are working to improve further our EBITDA in Romania. So the answer is yes. And the last question, based on Q1 is high single-digit to low double-digit revenue growth and mid-teens adjusted EBITDA growth for 2026 realistic? Well, for sure, for sure. A question from Jeremy. In Belgium, can you please help us understand the difference that duct access would theoretically make to the cost of the rollout per household for fiber. For example, if you can pay for using someone's duct, what happens to your cost to pass per home? How important is that access to your overall business plan? Look, it's a broad question. And yes, the broad answer is certainly, having access to someone, ducts, primarily Proximus, the incumbent is helping you roll out faster because digging your own trenches to put your ducts and to put your [indiscernible], first of all, takes time. And second, of course, is costly. And yes, so overall, it's certainly an improvement. Having said this, it's difficult to discuss the economics per home because at this moment, there is no finalized or concrete offering on the table. What are your ambitions in the U.K.? How much is your FTTH cost to pass in the U.K., please? Will you look to have a nationwide product? Would you wholesale from others or just do your own role? Are you looking at a possible MVNO deal? Well, I think the answer is yes to most of these questions, meaning we are keen to develop our U.K. presence just like we do in every other market. I would probably qualify this statement a bit. U.K. is a large market, larger than any other market that we operate in, including Spain at this moment. So certainly, we will probably approach this opportunity on a step-by-step basis, trying to roll out smaller footprints in selected areas and growing from a smaller base to a larger presence. Having said this, certainly, we're interested to have a nationwide product. It's just that it will take time. Will be wholesale? Of course, if we have a good offering, we will do so. And if we are looking to do MVNO or similar deal, yes, because we think that offering a mobile product, a converged product, mobile and fixed is probably more appropriate than offering just a single product as we speak today. And a question from -- yes, the last question from Jeremy. Any update on the Spain IPO process? The market is volatile, but telco valuations are near all-time highs. What are you waiting for? Well, we -- thank you also for the critique. It's really helpful. We have decided not to do the IPO in the window, which ended just a couple of days ago. Really for the reasons of the market, we did not want to -- despite very positive feedback from investors, we couldn't predict the geopolitical volatility. We couldn't predict the market outlook or the market situation. And we've chosen to not proceed with the IPO at this moment. However, we're certainly very keen and very open to complete the IPO. Whenever the next opportunity or the next window shows up, we will come to the market. Having said this, we will certainly want to take benefit of a calmer market. And once again, I come back to your critique and saying that valuations are all-time high. But yes, we just didn't have the guts in these volatile times. But then probably more importantly, our growth continues at a very fast pace. So with more than 30% -- or significantly more than 30% growth in EBITDA this year, we want to capitalize this opportunity as well. So whenever we come back to the market, we want to benefit from a good market, but also a reflection of our results so far. Maybe, Marius, would you add something more to this question so that we just complete this topic?

No, I think the answer is quite complete. I mean, we had a very good experience in interacting with investors and we've seen a lot of interest. Unfortunately, the moment where we were in the market was not the best one in order to capture the investors. So we prefer to wait for a [indiscernible] market, as you mentioned before.

Yes. Also thank you for the question. Irina is asking, could you give us an indication of the prepaid share within Digi's Romanian mobile base following the Telekom prepaid acquisition and how you expect the prepaid/postpaid mix to evolve going forward? So I think prepaid share in our RGUs is not significant. It's somewhere in the 5% to 7% area. So yes, we -- yes, as you see, we continue to be mostly a postpaid business. About the evolution, we have taken over a relatively small base of users from Telekom Romania Mobile. We are -- we have resumed prepaid operation, and we will continue doing so. Having said this, we noticed that our traction and our ability to sell postpaid product is bigger, is stronger. But having said this, we are growing also in the prepaid segment, but it's difficult to say anything more on the future shares. Again, having said this, there's a legal market for prepaid, which we didn't concentrate on until now, but we will continue being present and operating on this market as well as we realize there is a niche of customers who demand this product for various reasons, we will offer these products going forward in Romania as well. A question from Christian. What are the plans in U.K. in terms of RGU's ARPU? Well, so difficult to say. We are still very early on. We are in the test phase of an initial pilot covering North London areas. We've launched our product offering with 500 meg product at GBP 15 and 1 gigabit product at GBP 20. We see interest from customers for these products. We also see interest from our customers to buy high-speed products, 2.5 gigabit, 10 gigabit products. But at this moment, it's too early to say and it's too early to predict anything. But so far, so good, and we are really in the first days. Yes. Second question, please explain penetration rates in Slide 10. SMART footprint average penetration rate is cumulative penetration of Digi in books. It covers the penetration rate in year 1, what it covers in the first year. I don't understand why penetration in year 8 is 16.9%, but in the slide, you say, for 2019 and 2020, it's 28% and 25%. I'll let Marius answer this, but probably you are mixing the overall penetration of the network with penetration in certain cohorts in the earlier cohorts. But I'll let Marius explain it in better detail.

Thank you, Serghei. You're right, Serghei. So 16.3% is the average take-up we've reached by the end of quarter 1 2026, which is practically part of the eighth year of deployment for us. When you see this in the upper part of the graph, this aggregated by cohorts, you will see the red line and the blue line, which are 2019, 2020 cohorts that reached levels of penetration of 28% in the case of 2019 and 25% in case of 2020. So this shows the potential of growth for the rest of the cohorts towards the 25% along the years that will come. And the overall average takeout that we expect to improve to 25%. And 6.9% penetration you are referencing to it's year 1 penetration for the latest cohorts 2025. So just 1 year of activity for recently deployed network that reached already by the end of first year, 6.9% penetration. Hope this is helpful.

Two more questions from Christian. I think both for Marius for Spain. Why RGU decreased to 5.5? I'm not sure I follow. Marius, if you do, please help me. And the last question, where do you see the margin stabilize in Spain in the owner model?

Not sure about the 5.5% decrease of RGUs. We haven't decreased RGUs in Spain, never. So from the point of view we grow every quarter. And especially this quarter, we had record growth in fixed broadband RGUs, the best quarter historically. So please clarify what you are referring to. And regarding margin stabilization for owner model, I imagine you are referring to mobile network to MNO economics, which practically now reached a stabilization effect of margin and from now on will continue to improve quarter-by-quarter. We haven't provided a guidance for the margin itself only for Practically, that guidance for EBITDA reflects also the margin evolution for mobile networks for mobile business for the next year or so. I hope that is helpful.

Yes. So in the meantime, Christian has clarified, he meant 5.5 decrease of ARPU from 5.7 a year ago at the entire group level. And I think we did cover this. So various markets have different explanations. But all in all, we are growing our volume and we're growing our revenues, and we are very happy about it. But just very quickly to recap what I said already during the presentation, Romania effect of -- mostly effect of ForEx, Spain effect of price changes in certain products and change of customer behavior choosing more attractive packages and Portugal migration from NOWO packages to -- of NOWO packages to Digi prices. So overall, these are the explanations. And Christian has one more question. In the owner model, what is the depreciation and amortization in terms of percentage of revenues? We'll try to look into it. I'm not sure we'll be able to answer during this call. If not, we'll come back to this later. Thank you very much. Andrew, I hope to better understand the opportunity you see in the U.K. fiber market. It appears highly competitive from both the wholesale and retail perspective, particularly in urban centers such as North London. How are you thinking of scaling this investment? Well, it's true, but I think -- I don't know. I think I'm not sure I can answer it necessarily for the U.K. market. I could probably answer it overall. We rely on a strategy and a philosophy that favors latest technology, high quality of services and affordable prices. And I believe there's a niche of this kind in most markets, if not in all of them. And we're trying to exploit this niche across -- in the markets where we operate, U.K. included. So I think this is it. And basically, having us in this way, it's difficult for me to compare us to any other operators and the situation on the ground. But if you think that GBP 15 per broadband service is not affordable. It's not relevant. Let us know. A question from Ben Bruce. I'm late on the call, so the question might already have been asked. On Belgium, how do you explain the growth of mobile RGUs in Belgium, only 8,000 in Q1, the lowest number on record. What do you expect for this and the coming quarters? Where are you on the fiber rollout in Belgium in homes passed? And what are your plans? Are there any talks going on with Citymesh on the put option they have for their remaining stake in the joint venture. Thank you. Well, I will not comment on our discussions with our partners at Citymesh. I think this is private before it becomes public. And on the previous questions, look, we're still trying to learn our ways around Belgium. We are growing. Indeed, 8,000 is not a large number, but we are consistent, and we will continue doing so. So no changes here. We are really adjusting the resources that we have available for the Belgian market with yes, how much we want and how much we can spend with the trade-off in the volume of growth and so far we are happy about this. But thank you very much for the question. Question from Irina. The regulatory fees increase. Could you provide more details? From which market or what drove this increase? Will this increase persist? No, I think there was a misunderstanding. There are no regulatory fee increases. So I'm coming back to Irina. Dan is helping me to understand the question. You must refer to increase in spectrum fees that we have shown in the P&L. The spectrum fees have increased in our Romanian market due to the fact that we've acquired significantly -- sorry, Spanish market due to the fact that we acquired significant spectrum holdings in both markets. In Spain as a result of remedies taken as part of the Orange/MasMovil merger and in Romania as part of the Telekom Romania mobile acquisition. So these are not regulatory fee increases. These are spectrum fee increases. And the second question from Irina. There's a draft Romania regulation under discussion that will require Digi and other telecom operators in Romania to convert euro-denominated tariffs into RON at the official National Bank of Romania reference rate. Assuming the draft becomes law, how will this impact Digi P&L.? Not at all, whatsoever. If you are following the press around this announcement, Digi was placed as the only operator in the market that already converted its euro-denominated tariffs into Romanian Leu using the National Bank of Romania. So no impact for us whatsoever. A question from Ines. Portugal reached 905,000 services. But how many clients do you have in this market? What are your plans regarding Portugal this year? Is the investment plan? Your competitors say that there is impossible to invest with 4 players in Portugal and then the market will consolidate. What is your view on that? Well, indeed, thank you. We've reached 905,000 RGUs. Unfortunately, we're not tracking on a day-to-day basis, the number of unique customers. I expect the number to be in the area of 600,000 to 700,000 users. But this is an expectation. I hope it's helpful. Regarding our plans, so I did mention during the presentation, we are consolidating operations with a view to improve our losses, to diminish our losses. We are consolidating our operations with the view to increase sales, which is gradually happening. And of course, the associated revenues. And yes, we continue to do investments in improving the mobile coverage, in improving the network of sales points and of course, also improving the fixed coverage. And the last mention, which is really not a question to us, but it's really a comment that probably the other players say it's very difficult for them to invest and they look for consolidation. I think it doesn't affect us one way or another. We invested in Portugal, and we very much like both the market and the opportunity, and we are here to stay. So if the market consolidates, most likely it will be around us, not -- but yes, never say never. We'll see. A question from Conrad. Do you consider reentering in Hungary or expanding to other CE markets, for example, Poland in the future? Well, Conrad, we're always looking for opportunities, certainly. Thank you for the question. If there will be welcome opportunities, we'll have a look. At this moment, we really -- we've just announced U.K. a few weeks ago as a new market. It's a very big opportunity for us. So I would answer very, very shortsightedly. At this very, very moment, we are not involved and we are not working in any other opportunities. But again, as I did mention, never say never. A question from Christian, and it's a question to Spain. So really for Marius. Coming back to EBITDA margin in Spain, you target 30% in the midterm. from what you've said in the presentation. So I think Christian is asking us to confirm whether we are targeting 30% in the midterm. I think, just to clarify, what I did mention, I did mention more than 30% growth this year, but I'll let Marius to expand because I think you were picking up on what I said.

Thank you, Christian. Yes. So the target for EBITDA for [indiscernible] operating leases for midterm is to reach levels above 30%, and that will be mainly driven by gross margin improvement both in fixed and mobile services and fixed due to the mix effect of deploying new SMART footprint and increasing the penetration both in existing footprint, and in mobile due to the increase of the RGUs and also due to the MNO economics, operational leverage that we have that will improve profitability.

And a second question from Christian regarding the U.K., what region we are in, what major towns, what population? So yes, thank you, and thank you for the question. I didn't mention it before. We have started in Luton. So our pilot is in Luton, but we will follow with other towns surrounding. So -- but yes, our pilot is in Luton, I should have said it so more clearer. Thank you very much for the follow-up question. So far, so good. These are the questions. We will wait maybe a minute or so. If there will be more questions, kindly let us know. Otherwise, we will close the line. And just to come back with the correction, our pricing in U.K. is GBP 15 per 1 gigabit service, GBP 20 for 2.5 gigabits and GBP 25 for 10 gigabit service. Well, thank you very much. I think it was a very helpful call, and thank you very much again for discussing our results for Q1. We will meet you all mid-August discussing second quarter results. I hope just as good and better. Thank you very much. Bye-bye.