Tele Columbus AG (TC1) Earnings Call Transcript & Summary

Good morning or good afternoon, and welcome to the Tele Columbus Capital Markets Day live broadcast. My name is Adam, and I'll be your operator for today. [Operator Instructions] I now hand over to Sebastian Artymiak to begin. So please go ahead when you are ready.

Hello, everyone, and welcome to our Capital Markets Day. We are delighted to have you joining us today for the next 3 hours. For your convenience, the slides are still available in this moment for download in the password protected Investor Relations section of the company's website. This event, including Q&A session will be recorded and will be available in the log-in section of our website after the event. Our presenters are CEO, Markus Oswald; CSO, Christian Biechteler, CTO, Michael Franklin; CCO, Jochen Busch; and Interim CFO, Nicholas Oswald. Christoph Oppenauer for Morgan Stanley Infrastructure Partners and Supervisory Board member is attending as well and will be available for the Q&A session. After our successful A&E transaction, this event is an excellent opportunity for us to share some insights to the Board of Financial Markets community, and it's also a chance for you to hear direct -- directly from the entire Executive Board. After the introduction for Tele Columbus, we will cover following topics: competitive advantages; current trading; focused strategic plan and the reduction of NetCo/ServCo. This will be followed by a Q&A session. And now, it's my pleasure to hand over to our CEO, Markus Oswald. Thank you very much.

Thank you, Sebastian, and good evening to all of you to our first Capital Markets Day, I will lead you to the -- through the first session. And, give an introduction of where we stand today, what is Tele Columbus, I would say that a couple of people on the line are following the company several years, but I think we also have new participants. So I thought it is helpful to start a little bit wide from the beginning and then come also definitely to the future of the company. So Tele Columbus, what are we, what we are doing in Germany and so on. So Tele Columbus comes from an cable operator side since decades and is now transforming into an ISP company in Germany. We are most likely present in the eastern part of Germany, but we are also strong in Munich as well, Nuremberg in Bavaria, Hamburg and in some areas near in Hessia. o we have a really attractive footprint, which is presented on the right side. I come later on to the footprint and really uniquely positioned in the German market. And what we did in the past is really a slide, which come later on, which is my last one slide because here you -- we can present you that we are right now the fastest-growing IP operator in Germany. So when you are looking on the footprint, and this is mainly where we are focusing on our story later on, we have right now or near to finish during the course of the year, 2.3 million footprint of gigabit ready homes connected, where iron gig -- 1-gig is possible to -- on the IP side, to be purchased by our customers. We have a footprint of near 700,000 homes TV access only. And compared to the normal speech in the market, what is homes passed, we are near to 5 million homes passed in Germany. So a customer base on RGU base, where really cross-sell and upsell opportunities are there, we are using them right now. We will use them in the future. This altogether with our strong majority shareholders, which is on the one hand side, from the infra side, Morgan Stanley Infrastructure and from the German telco side, United Internet. A brief summary what happened last year. So last year, on the left-hand side, you can see our gross profit split. So we are transforming into an IP company, but very important, we are already -- most of our gross profit is linked to Internet & Telephony, which is really important. TV is also a position which will develop over the years. And Internet will step in and compensate some of the losses we are expecting to see on the TV side, I'll come later on to that. When we are looking at our total revenue 2023, we delivered more than EUR 450 million on revenue, more than EUR 190 million on EBITDA and something. And based on a customer base of 3.5 and more million RGUs, and this is a cross-sell and upsell opportunity. For us, it was a special year. I joined last year, Feb. The company and for us, it was a special year, the whole management team because we managed to bring the company into EBITDA growth and this was the first time since 6 years, very important for us. Housing Association, this is unique and special in Germany, and unique and special for Tele Columbus. And the numbers 750 is an important number for us because this stands for 750 professional housing associations, which is linked to 70% of our total footprint. What is special on that message? So with a perfect since decades lasting customer relationship, we are managing with 750 customers on the housing association side, millions of tenants in their building in Germany and 70% of our footprint. Why it is important? Also [indiscernible] with housing associations and the role in Germany because what we are also showing you today is how Tele Columbus, will transform from a cable operator into an IP operator into a fiber company is also the down graph here. The graph shows the position of Germany, and this is not linked to the forecast for the European Football Championship. It is linked for the role of Germany in the fiber market in Europe and the position I didn't counted. The good thing is that Germany needs and is willing to improve and that Tele Columbus has a special role in this improvement because we are on the same track like Germany. Fiber is getting pace in Germany. Where it's getting place, I will show you. The good thing is that it is exactly in the footprint where we are playing. It is losing pace in other footprints. I will show it later on to you. Later on is now. So just let's step back a little bit and what is Germany? So Germany and households in Germany, 42 million households in Germany. On the left-hand side, the copper twisted pair is nearly in every of these households all over Germany in small cities, in little villages in urban cities, in so-called A cities like Berlin. And here, we have the national player, Deutsche Telekom, who is fighting against that they are losing on copper. When we are now looking what is 42 million households, how they are divided and where we find a lot of buzzwords in that FTTH story in Germany, you can really cut Germany by half on housing on households and 21 million, the numbers are really near to that is greenfield. Greenfield means, we are in rural areas. We are in suburban cities or towns a little bit urban cities, smaller ones. And here, we have that so-called greenfield approach in Germany, and of course, also fiber needs because copper is limited in -- by 250 megabit VDSL. And here also, companies are looking for fiber exploration. And here, we have listed them it's Deutsche Glasfaser, it's telecom as well, Vodafone, Deutsche GigaNetz, LEONET, Unsere Grüne Glasfaser in Germany. So a lot of companies are going into dense areas with immense build-out costs, I can later on to that. And here, we have that greenfield approach and I would say it's normal -- in German, it is in every [ miles ], but you also know that overbuilt world in Germany. Here also, the main parts of overbuilding networks are taking place in these greenfield approaches here because -- for example, Deutsche Glasfaser is going into a small city and saying, "Oh, you only have copper, now I'm in that city". Weeks later, it could happen that Deutsche Telekom, who in former times rejected that area is saying, "Oh, I'm also now going into that city and here overbuilding Deutsche Glasfaser. When we come to the right-hand side, exactly, again, 21 million households, we are in the big cities. Big cities, Berlin, Hamburg, Munich, when I look at our footprint lightly, and so on and so on. And here, most of the professional housing association are doing their business and coming back to that number of EUR 750 million. I mentioned before here, Tele Columbus is -- has his home turf, Vodafone as well coming from Kabel Deutschland and Unity Media, for example, the integrated 10 and 6 years ago. And here, the concession agreement is unnecessary to access the tenants of the landlords or the housing associations. And here, the demand is driven also by the housing associations. The good thing is it is supported by the housing associations. Very important to know this differentiating points in Germany, and this is also important to connect the household in a rural area, you are immediately above EUR 1,000 or even EUR 2,000 per house household to connect that household to an FTTH network. Coming to the right-hand side in A and B cities, here comes the advantages of -- or the advantage of Tele Columbus, that's in the ground. And we are one of when -- at least, I would say, the cheapest deploying fiber company in Germany or near to that. I'll come later also to that point. Very important to know this with greenfield or urban city, A city, B city approach. And this is what is our plan. So we stopped at -- we started 23 in the middle, it's 28 and 35, 35 means out of our perspective, okay? The deployment will go on into that area of time. Germany says they want to achieve a full fiberization of the land of Germany, the government said in 2030, we are not quite sure about, but definitely we'll reach this amount. Important to know for you is that this doesn't mean when coming back to 750 housing association or the housing association business, very important to know is that we are linked with our further rollout with housing associations. And here, in many cases, with their renovation cycles of the areas, their buildings. And this is very important to know because deploying fiber doesn't mean signing fiber contracts and locking up these housing associations. Because in our point of view, I mentioned it several times before, the cake, the fiber cake in Germany with big housing associations will be sliced in the next 5 years, I want -- I would say, because we are right now signing contracts with housing associations, which are telling us we want to have fiber in our footprint. We want to have fiber with new telecom numbers, but let's start in [ 28, 29 and 30 ] or even later, depending what their wish is, and they know because here, I will take my renovations. I will do in isolation on my buildings. And for that, I also combine these building measures on my -- in my household with the fiber rollout. So this is deployment, not signing contracts. By deployment of these fiber rollouts, our complete business will change. When I look at the gross profit split in '23, of course, we are now the highest one is with IP already, but TV is very dominant. And TV is a dominant player overall in the next year. Service revenue will decline. I can later on to tha,t, why? But it is a stable base in some cases on the housing side is a declining base. But nevertheless, a stable revenue stream will be linked to our budget. But the gross profit share of IP takes more and more percentages out of that graph here and will end up in [ 35 ] in dominant way, I would say, in that case. So ending that introduction session, what are our 4 strategic pillars for us, and I will come later on to that again, We, as Tele Columbus, with our customer relations to housing associations with our profile in urban areas have a unique competitive advantage compared to other competitors. We hired a seasoned management. We are in the ramp-up process near to finish it. So when you -- when we come later again to our performance, you have to have in mind that a lot of team members used to the fixed line market in the past only entered during the course of the last year. So hopeful and definitely, they will pace on and bring a higher pace into the company for the next 12-months or for the years and years are coming, we have a strategic plan, exactly plan and so on, and we can outline or will outline this. And this is new for most of you, we are right now exploring the opportunities of a possible NetCo/ServCo split for the future. So I already talked about the competitive advantages. So what are they? So again, the market surrounding which Germany and the speed demand, housing associations, I already mentioned. What is the exact network competition or footprint competition? I will talk to you about this topic. Speed and price advantages in our footprint, consumer sales, what are here our strategic pillars or advantages and upgrade FTTH rollout and cost advantages. I will cover shareholder support of our shareholders and the team, the management team, again, makes a difference. And this will be the overview for the next minutes. This slide, you already know, I just mentioned the graph below, but when you look above, very interesting, what does it mean? So when I look at 2024, there is a monthly gigabit appetite of a German household of 304 gigabits, which he is pumping over the network. Right now he is doing it in Germany, again, mostly via VDSL. And what you are seeing here are the exact numbers, which are estimated in Germany, how this speed appetite will grow. So '24, 300 gigabits per month -- it will triple nearly triple in the next 4 years. It will double at least to '26. And now the biggest question is where is the tipping point where the customer, the VDSL line, which a customer is used to or maybe 7 years ago, 6 years ago is not enough. And what we are seeing in our inflow is that it starts beginning that it is not enough, and this plays in our strategy. Again these, here you are, EUR 750 million. Here is the footprint -- our footprint, so coming from Hamburg and [indiscernible] in the North, then you see in the Eastern part of Germany, we are strong nearly in every country here. It's Berlin, it's Leipzig, it's Trebsen, it's Halle. These are our biggest cities, Jena, Herford. We are also in Hessia, in Offenbach and Frankfurt. We are in Nuremburg, in Munich, but also in Berlin, Brandenburg in Lörrach. And these are -- this is our footprint. The good thing is managing a footprint is work to do. So we -- like I said, the housing association is our entrance, we have to manage 750 customers and this is our footprint. This we are doing on an individual basis, individual contracts, of course, but covering 70% of our footprint. When I look at this left side, again, 20 cities, we only have to concentrate on 20 core cities and covering here again, some also of the smaller housing association, which then stands for 75% of our footprint. So this also means efficiency, efficiency on planning, efficiency on marketing activities, efficiency on sales activities. And this also is a unique position for Tele Columbus. Okay. This is my wonderful footprint because I get footprint chart because I get a lot of questions how you can compete with Deutsche Telekom or with Vodafone and their competition on fiber, for example. What I say, can the competition in our housing association is like this. So my 23 million households are thinking like this will left building. On the left-hand side, right now on a TC DOCSIS 3.1, [indiscernible] network in the household and the copper network of Deutsche Telekom. So right now, I'm competing against 250 VDSL with my 500 or 1-gig products. We will transform our company into a fiber company, and here overbuilding takes place, we are overbuilding ourselves the DOCSIS 3.1 network and exchange it into a fiber network. Year-on-year, pace by pace, we also then will, in some time, we'll shut down the DOCSIS network and the only network which is running in the building compared to the copper network is the FTTH network from TC. And here, we are then -- yes, you know what bandwidth is 1-gig, 2-gig symmetric and so on are competing against 250 megabit of Deutsche Telekom. And for that, on the right-hand side, the pie chart is right now, the penetration on OTC retail, which is 99% right now because we are just deploying on the wholesale side is not so high, but this is our growth, not only opportunity. It is just the way the market is functioning. We will getting pace on growth. I come later on to that, that we already did, but we will getting penetration into our network. We will getting penetration over the years, over the fiberization, we will do it on the DOCSIS network as well on the fiber network and then also wholesale taking place -- pace on our network and the market shares are growing in the footprint in the house. And this is important to know. We are not competing against a fiber connection of Deutsche Telekom, which is offered in the market because in the building, which is here, Kaiserin-Augusta-Allee, where we are sitting in the building, this is a competition which is taking place. It's very important to distinguish here the footprint. And this is again, what our strategy and Jochen Busch, my colleague, will talk you through his strategy on the consumer side. Just -- what you see on the left side is -- with the dark blue, this is our product offering and standard prices. We are not offering a 100 megabit product just for your information. And hence, on the 400 side and on the 100 side, Deutsche Telekom is, of course, offering such product in the market, but not in the building, like I said before, so you can choose. You can choose EUR 45 for a 100 megabit on VDSL or you can choose to pay the same price with [ 10x ] the speed. And this is our strategy, times x the speed value for money, service for money. And this is how we are gaining customers right now. This is our strategy, not to mention too much because Jochen also needs to tell you this fantastic story. And on the right-hand side, this is what we already achieved and what we transformed the company. So performance is important for us. It's wonderful to lay out wonderful networks if it is on DOCSIS or if it is on fiber and activated. So homes activated, not homes passed is the measures we want to set into the company. So homes activated are important, paying customers are important. So this company is getting pace on network. So what you are seeing here are the net adds per quarter. So 30,000 in the year '22. We entered in '23, so we doubled the net adds. And this is getting pace. And a very important look at Q4, that is our best-selling months ever, 25,000 net adds we entered in. I guess the answer, yes, because of special projects, of course, of special projects. The good thing is we're 750 housing association customers or even with 1,000 or as 1,200, you can create your projects, and this is what we are creating our growth pass on. So this is what is driving growth in the future on the IP side. Again, you remember the slide before, rural areas, urban areas. Here is an example, urban competition and suburban competition. So when I'm in the suburban area, it is normal to have a build-out cost between EUR 1,200, even EUR 2,400 connect euros per building and per household In the urban cities, it's more 800s -- between EUR 800 and EUR 1,500. In Tele Columbus, of course, we also see EUR 800, yes. In some cases, we also see EUR 1,000. We also see less but the average is something around EUR 650 per household. And this is Level 3 and Level 4. And Level 4, building out Level 4 is a speciality of Tele Columbus. We have 200 own craftsman on the ground. So also we have built out capacities. And when we are saying FTTH rollout, this is a number and this is a unique advantage. Why it is so? Nearly 80% -- because of our ducts already lying in the ground, so 80 -- near to 80%, we only have and the biggest amount of cost is dug -- digging in the ground. We only have to cross meters where we have to dig less than 2 meters, I think it's 1.9 meters because of our duct facilities in the ground, which is also a unique point for Tele Columbus in the German market. When I talk about FTTH, I, of course, talk about open access in these buildings when we are deploying FTTH. Very important because this is also then the baseline for our wholesale strategy stepping in during the course of this year already, but also in the coming years on fiber. Fiber rollout costs money. It costs money, like I said before, EUR 650, good that it isn't EUR 2,000 whatever. But for sales, it's never enough. For that, we did a refinancing in the last year, which in the last year was the main work. We've closed it in March this year and getting capital injection on top of it from our shareholders by EUR 300 million. The good thing is we can put these EUR 300 million completely into our networks, Morgan Stanley Infrastructure with several funds invested all over the world in infrastructure projects and United Internet known in Germany as a telco expert company. So with this combination, the best shareholder combination, I would say you can have in the market. We are really -- we are funded and we have the support of our shareholders. Very important for us. It was a way to go last year, but we already achieved it, and this is good for -- as a baseline for the company. A little bit more. So my -- to the team. So Christian Biechteler and where the team is coming from. So you can see the telco industry especially also former TDC members, Telefonica members 1&1 members in the team, but also Kabel Deutschland and Vodafone background. So we are on board since last year. This is Christian and Michael and me, we started in Feb last year. Jochen joined us in summer last year and Nico also in summer last year. The important thing is it is not only us. We are helping the company, but steering the company is the C-1 level. And the good thing is here that we also attract tons of people to come to Tele Columbus and transform the company. And there is really a change not only in the C-suite, but also on the change on the N-1 near to 60% to bring pace, to bring performance to the company. I'll give you a short update on current trading as well in the second part. So what we did, so current trading is the result of what we did in the last 12 months. And here is -- here are the 4 biggest points what we did. The pace of change in sales was our biggest topic, number one. We have to deliver it. We want to deliver it, we delivered. This is a good thing to know. I will come to that later on. stabilizing housing association business by at the same time talking about the bulk migration, second biggest point last year, and the fiber migration of the company was done in the housing industry section already done and in progress. Change management, change attitude, bringing this into the company not only in the sales, not only in the housing, not only in the B2B department, bring it into finance, bringing it to wholesale, bring it into the PR department, whatever is taking place is already done. And like I mentioned before, the completion of the A&D transaction. So let's dive into these buckets a little bit more. To be honest, I love this chart, on the left-hand side is it is right. We are the fastest-growing sixth IP operator in Germany. What you see here, Tele Columbus stable in '22 [ versus ] they are strong. But they are getting strong and getting pace is something different. And getting pace takes place in '23, and it's lasting and it's growing again. And when you look at the others, so United Internet and Vodafone are losing. The others are growing as well, but they are also slowing down, and we are growing now on a 9.3% level, first numbers I can show you because we have our call next week, but I want to give you a glance of that. So 9.3% growth on a growing base, we delivered in Q1. In Q4, we delivered 9%. And this is what we see or what we show -- want to show to you monitor growth, especially on the IP side. So with a focus on the housing business to stabilize this business, we did at the same time. We will build our B2B unit. We injected life to the wholesale department -- [Techincal Difficulty] Hopefully, you can understand me now better. The multichannel approach, Jochen will speak to that later. Bulk migration and by doing that here is also when we talk with housing association and bring then FTTH into the buildings and also the DOCSIS 3.1 rollout, you have to deliver on the technical side, planning, building and running the network. And this is a fantastic job from our technical department. So we did it, and the building capacities are secured for the coming years. Bulk migration, biggest point in every call, biggest point in every discussion, bulk migration in the German market, I would say that, yes, you can compare companies. But at the end, it is sometimes also apple and orange or whatever. So these are our numbers. This is what we are looking for, and this also differentiated us to other companies. So very important for you to know the system in which we are migrating into the individual TV contract is known in the company since decades. And what you see in the number is that already near to 60% of our housing association contracts are in this system where bulk mig -- contracts have to migrate in. Why is that? And this is the role and the typical positioning of Tele Columbus. In the eastern part of Germany, it is since decades normal that there are individual contracts. And for that, the bulk migration definitely is a topic for us but less changing topic than in other companies in the former cable operator industry in Germany. And this also, when you look at the gross profit, 75% of the gross profit is not linked to bulk contracts of the company. So yes, we have to manage it. But there are also some other opportunities we are gaining out of it. And this is what we bring also to the company. There is a topic. We have to solve it. We have to manage this and where are the advantages we can take out of these points. And here are also some of the advantages because we already started migrating. So these are the slides we have to do. So we did in '23, 60,000 migrations households, in first quarter, 110,000, we are now in 160,000 and in Q3, 665,000 households to migrate. Very important for you to know what we are doing here is, together with the Housing Association, remember, biggest part, 750 talks and corporation models, we partner -- we are partnering with the housing associations. They are sending out letters, announcing us, there is a change that something happens. And this takes place 5 to 6 months before the migration date. And this is what we are also saying there is a presales [indiscernible] phase. So when you see 600 -- 65,000 households already, we are -- they come to be migrated, but we already tackled them and also already signed 20 more than -- or something around 20% of these households for TV single contracts. We did that also with this Q2 where we are achieving over 30%. We did that also on Q1, which is overachieving -- or this achieving of 40%. We did it in the past. And now the project goes on. When the migration date is there, we will at least be in 5 to 6 months later on as well. So migration, but migration net change effect and date for us is something around Q4 this year or even Q1 '25, and going through these households again and again. And like it's mentioned on the left-hand side, we are still targeting 50% to 60% of these migrating customers. Yes. Very important to know that we launched and we come later on to that as well a Next-Gen TV platform, which supports our story that when we are in these buildings, the 3P share is higher, and we are building up here. We already signed contracts like mentioned here. So what you're seeing here that these contracts being valid then in the system in June, July or August. And this is also then also with a higher IP share. Also IP right now, net sales in our logic will be an add into our system in the future. And this is how we are tackling this topic together with the housing association, together with all our sales channels, together with the whole company. Transformation of a company when a new management team goes -- comes in is what are the biggest topics, like I mentioned, and is shown here again B2C sales organization to pump in B2C sales blood into the company performance-driven was topic #1. Network in an FTTH company is topic #2. So Michael and his team concentrating on changing the network. We call it One Net project that out of a fragmented network. We're simplifying processes. We're simplifying the network, bringing down costs and bring it to one network. We rebuild certain areas, and this is also even also in the CFO [ area ], we are rebuilding the organization and are changing systems processes, linkages to the company concentrating like I said, on performance, on EBITDA growth on operating free cash flow and so on and so on. B2B sales organization, the same with wholesale, we are ramping up. We are adapting to the market and changing here also the system. The same on the technical IT and production side. So this is our tip [ re-org ] where we implemented the normal process steps, plan, build one, and service system and service network where we're important to revamp across the entire organization. So we are looking at processes, IT system, procurement, FTE external. So FTE I'm cut on costs on FTE for that. I hired expensive external ones, don't do that again. So in-sourcing external ones, these are our strategic pillars also on the cost side. So sales is important. Network deployment is important, but also financial performance and yes, in line with results and so on is very important for that company again and in the focus. Like I said, one of our topics was to do the refinancing or like we call it or like it was at the end, the mend and extend process. So at the end, for us, very important. There is a new shareholder contribution by EUR 300 million. Lenders and noteholders extended until the first of Jan 2029. The EUR 300 million also very important for us on the senior secured note completely picked here the interest rates on the term loan, mostly picked on the interest rate. So the EUR 300 million shareholder contribution goes directly into the business and in the focus areas of our business. This I showed you before, this is 2023 and now a short glance on our first quarter. Very important for you, we will bring the results next week. But because it's so near, we also are willing to show you a [indiscernible] first estimate primarily prior to our releases on these results. And this is what I mentioned before, what you see on the left-hand side. And for me, this is, on the one hand side, related to our projects on the bulk migration. But nevertheless, this is exactly where we want to bring the company in. So what we are seeing here on the Q1, we did a tremendous jump on bundled shares, bundle and speed tier shares, so above its bundle. So we are near to 50% that every IP customer takes a TV bundle. And on the tier mix, and this is wonderful because of course, it stands for high ARPUs. Nearly 50% is taking 400 or higher than 250 megabits. So are moving away or signing up for our contracts and moving away from the DSL line. And this is what I explained to you before. They are doing that because the band with bundle hunger is high when we are comparing our conditions to -- or the prices and speed tiers to the offering in the building to the in-market competition, we are the price, the service and the speed performer in the building. So customers are changing their contracts. The good thing is this brings us for the first quarter compared to prior year, a 1.3% revenue growth, EUR 48 million EBITDA. We invested EUR 53 million CapEx. We added 15,000 net adds on the IP side. We will bring a little bit more balance next week to that, 15,000 is less than Q4 numbers, of course, because it is seasonality, but nevertheless, we already signed in, like I mentioned before, because with this bundled share, we already signed in contracts on IP. And when the TV bulk migration takes place into an individual contract in June, July and so on, these already sold IP customer contracts are then also taking in as a net add. Like I mentioned before, right now, more than 100,000 customers migrated on that side, good. Focused strategic plan. So what are -- or what is our exact plan? What are the pillars? What we want to do? And here on that slide, my colleagues are presenting you, Christian, on the housing association side, again, future-proof, what is the concession footprint? And what is the linkage? And this is also new for the company. And for me, it is the hidden sales channel for Jochen side. What is the partnership with the Housing Association, Also, again, a unique pillar of the company. Jochen will talk to you to -- what our channels are doing? What is our offering in the market? And what are -- what is -- what we are aiming for, what we want to do, what we want to change on penetration on IP. IP is the business where we are will count our business on, definitely. For that, we are building our network. And Michael will talk to you what he did in the past and is willing to do in the future with his teams on harmonizing the technology and the IT environment, IT biggest important pillar for every telco company. Again, the network investment is important. At the end of his slides, he also bring some flavor to other projects and core propositions of our company. And at the end of that session, Nico will give you the hands of the business plan going on. Okay. For that, I hand over to Christian. Christian, please.

Yes. Hello from my side. One of our important assets of Tele Columbus are our relationships to our housing companies. The most contracts have very long contract terms of 8 to 15 years. And in the event of renewal, it's a great opportunity to negotiate a fiber migration to FTTH. The technical realization often depends on the modernization cycle of the housing companies. But that's no problem because mostly we stay now on the coax network with attractive products, and so the migration is very efficient. And as Marcus said, we have homes connected footprint IP of 2.3 million households. More than 130,000 housing units are already built in FTTH. More than 350,000 housing units are contracted and signed and will build in the next months and years. And more than 300,000 housing units are in the sales pipeline. And the majority of these contracts are very big Tele Columbus customers in the top cities. So during the rollout, it's a great opportunity to address a lot of small- and medium-sized customers so that we will sign a lot of these open 1.6 million households in the next months and years. And the fiberization will give us a sales push for our own retail business as well as the open access wholesale business. And related to our account management, we have very strong relationships. So in 2023, we had a stable footprint slightly growing, and we expect the same in 2024. And the partnership, the relationship will help us to fiberize our footprint, but not only in terms of fiberization, but also in terms of commercialization, what does it mean? The housing company and Tele Columbus are partners. And the housing company informs their tenants about the current cable net provider, Tele Columbus, who supplies Internet and TV. And that gives us a lot of joint marketing campaigns. Here are some examples. Our first aim is to be present in every house that begins in the house entrance with posting notices on the notice boards. We are doing together co-branded mailings to announce sales agents who are in the properties to sell IP and TV. We are part on the tenant apps, especially in larger housing companies. And we want to make sure that the housing companies informs new tenants who moves in, that they can buy Internet and TV. So the cooperation is very efficient for our sales and marketing. And the partnership opens all doors for the B2C sales channels. And B2C is a good keyword now to switch to Jochen, who is responsible for the B2C department. Thank you.

Thanks very much, Christian, and a good afternoon to everyone to you. My name is Jochen. I'm running the consumer business. And I'm very happy that I can give you a big of a flavor what we have achieved already in the last 12 months, where we are currently standing and with kind of where our proposition is at the moment. And of course, how we actually want to grow going forward. So on the next slide, me doing it. Wonderful. Sorry. I think, look, Markus already told you that the whole organization has undergone a mindset shift because now we are focusing really on how to make money out of our network, i.e., how the end customer is paying us. And this is really now a consumer-focused mindset we established over the last month in the whole organization. I still believe my consumer organization has gone probably the biggest radical shift in transformation over the last, let's say, 12 months because not only we actually focus on a much more performance-driven attitude. We have probably changed 50%, 60% of the staff, but most importantly, we reshuffled the whole organizational structure. And on the right-hand side, you can see soon the left-hand side, you can see already the 4 categories in the full sales channels we have established in the last 1 month. And now we have hired. And now we have hired dedicated people to run an online channel at the door, a retail and a telesales channel. Let me quickly explain to you what it actually means. In online, of course, we sell our web page, which is pyur.com, pyur.de. And we probably still do 60% to 70% of our online customers coming via our own web page. And of course, the other, let's say, 30% to 40% reselling by our affiliates, which, in Germany, is mostly Check24 or our Verishop. This is quite important because our biggest competitors like the Deutsche Telekoms and the Vodafone of the world, they have actually the other balance. They sell more via the less on their own web page and more via affiliate. In door-to-door and retail was one organization before I joined. Although they have very different skill sets and we need very different skill sets, if knock on the door to convince a customer to sign or if you're in a shop and somebody comes in mostly with a service request. So we have separated that and hired again to dedicate people to run it. In door-to-door, we now -- we used to have 160 active agents running around each day to knocking doors. We increased already this to 300, and this is a scare -- [ scarce ] number because a [ scare ] mask because at the moment, everybody wants literally to have access to do-to-door people, especially with the bulk migration, the best and most effective way to convince people to sign, individual contract is on the door-to-door level. And here, we actually, as I said, we increased almost to 300 active agents per month. On the retail, which is stationary, selling, we do it via our own 42 shops and also via, of course, retailers like distribution organizations, medium [indiscernible], freenet and so on and so forth, which actually have a distribution network in Germany. And also here, we already were able to increase our active performing shops from 150 to roughly again roughly also to more than 300 shops which are selling our products going forward. Telesales. Telesales was combined with base management. Also here, we have now a dedicated telesales specialist and a dedicated base management specialists. And here, actually, we set up new organizations and new agents to focus on selling rather than service which it used to be. So I think what we have created in the last 9 to 12 months is really an organization which can perform and is set up to perform in the right way going forward. Besides that, besides the base management and the 4 dedicated channels, we also reshaped and repositioned PYUR as a brand because PYUR as a brand was not -- had no clear focus. And now we focused, as Markus pointed out, as a clear value-for-money provider. And we're going out into the market with a more aggressive marketing stance. We're going a bit against competition. We make it more fun. So we actually try to reset the whole branding and this was already recognized. You can see on the lower part of the page that we have won the connect test in 4 categories. So the connect test is one of the biggest and most prominent tests in broadband as well as in mobile in Germany. But they have different use cases from grandma who uses 50 bit to really the high-speed surfing with 1-gig. And we won in all the 4 categories as the best player in the market value for money player, which is not only in service, it's latency is, of course, price as well. So we won all 4 where we very completed. And just recently, early this week, the new chip test came out, it's also a super important one. And they actually compare the different providers per state, so Bavaria, Saxony, so on and so forth. And in 2 states in Saxony by the Brandenburg we came #1, in Bavaria, we became #2. These were the 3 states where we competed as well. And on the top, so it works. I want -- just want to say, the repositioning works, and we are very happy that so far, we have achieved also a recognition from external from independent houses, what we have done. On the top, we just gave you a bit of a comparison in terms of pricing because we deliberately took a chart from March because in the last, let's say, in Q2 and Q3, crunch time because of bulk migration. Everybody is offering crazy, crazy promotions. All of our competition is coming out with super aggressive pricing because now it's the time to win the customer. So we said, okay, in order to show you where we are positioned on a, let's say, plan level field, not in this aggressive period where we are now, we take a snapshot and this was in March. And we also compared, let's say, the 2 most liquid products, the cable product. So Vodafone and ourselves are selling most of our products in 250 megabit per second. And the DSL, they sell the 100. So they have -- the premium is the 250 BSL and our premiums to 1 gig. So we thought, okay, let's compare the most liquid ones. And you can see on the left side where we are against Vodafone. Yes, we are cheaper than Vodafone. However, we don't have the advantage of a mobile discount. And this is advantage at Telecom and Vodafone definitely have, and they play it. And when you're a mobile customer at Vodafone, you get a 10% discount on your mobile contract, but we have to basically discount them to their pricing. You see that we are basically even with the Vodafone pricing. And yes, of course, we are a bit more cheaper than the Telecom as well as other operators in the market who are selling mostly DSL or resellers of DSL. On the 3P, which does include TV, we are also aggressive because we need to, of course, attract our people to stay and this is now a huge opportunity with the bulk migration to come out with an innovative TV product, which we have done in February with pure TV. And you can see a similar pattern that we are, yes, slightly below, but not far below if it really include the mobile discount, especially in Vodafone and Telecom. So again, I think we are well positioned in the market and our strategy so far worked out and this is also what we want to do going forward. The last slide I want to show to you is where we want to go with our organization. And Markus already have shown you our penetration uplift and the net sales we can generate each quarter. Still, this company has a penetration of the network of our own network, which is around, I don't know, 24%, 25%, 26% at the moment. And this is a huge opportunity because we believe we can bring this company to a penetration between 50%, 55%, which is in market benchmark or market standard within the next 3 to 4 years. It's a massive challenge. It's a massive achievement what we want to do. But nevertheless, we believe we can do so with this new setup. And this is the light blue line, you can see on the left side of the chart. In this left, the light blue line will actually slow down once we have reached the 55% -- sorry, 40%, 45% penetration mark. So -- and then it will be, of course, much harder to get new customers in the same amount as you lose customers because your churn becomes higher and so forth. But then our wholesale strategy kicks in. And this is the rather greenish line on the bottom. So at the end, what we want to achieve as Tele Columbus is an ongoing growth in order to really go up to the 60%, 70% penetration in the years '28 and further. And how we do this, definitely, FTTH helps us. And I wanted to show you 3 different projects we are doing and what we have already achieved in these kind of types of FTTH projects. On the left side, you see a greenfield infrastructure. We don't do a lot of that because this is contracts with municipalities. However, in case we do it, we achieved a very quick uplift in terms of penetration. And this project, 3 months after we actually started the project and we're able to connect households, we had in 3 months already 15% penetration. And each quarter, you can see we actually added up 8 -- 5, 8, 10 percentage points of penetration. So at the moment, after was it 12 months -- no, 24 months exactly, we have achieved already a penetration of 66%. But as I said, these are not very much -- not a lot of projects. In the middle one, we have new builds. But these are contracts with housing associations. And when they build new housing and the good thing is that in these department -- these houses, there is no alternative. We are the only supplier to actually make Internet available unless they go by satellite or whatever, a mobile. However, this is of course, a huge penetration uplift in a very short time frame. And here, you can see within 12 to 24 months, we were able to achieve already 70%, 80% of a penetration. The most or the -- yes, the most projects going forward, however, will be overbuilt. We're literally, as Markus said, we will overbuild our HFC footprint with fiber. And you can see on the bottom, this is not going to happen overnight. So we actually step by step overbuilt from 0 to 27%, 47%, 52% and to 93% of our existing network. But what you can see is how much percentage penetration, we can literally gain each quarter in order to actually uplift our overall penetration. And here, as I said, the most uplift is actually between minus 7 because this is where we're pre-marketing already the service, up to, let's say, 6 to 9 months after we started to execute the overbuild. And then, of course, at a certain point, you achieve similar kind of growth rates as we achieve in our quality network. But I think I just wanted to show you that FTTH is a huge enabler for achieving the growth we want to do on the left-hand side. So this was a quick overview of what we want to do in consumer going forward. But this all works only if the technicians are doing the right things, and hence, welcome Michael. He will give you a bit of an overview of what we're doing on the technical side. Thank you very much.

Thanks, Joachim. And it only works if our sales guys sell. So this is why there's a good synthesis together. So my name is Michael. I'm in charge for technology, IT and production. And I'm trying to explain to you how we all this bring into life. First, we have started -- we have started to harmonize our entire technology and IT environment to enable all what was said before, right? So we are coming from and this is very important to note, we are coming from a very traditional sequential buildup of networks, which have been built to distribute TV signals over 40 years. So this is where we come from. So a lot of our infrastructures and services and service platforms have been built over the last decade to serve for the purpose of distributed TV signal. And now as Markus said, we are in the process of migrating the business into an ISP, which is also still dealing with TV, but on different means with a different medium. So on the left-hand side, you can see our current lot of structures, lots of interconnections, different access types, different backbones, different peering points, which all is to in a very fragmented topology. And on the right-hand side, this is what we are aiming by the course of this year to have a little bit more cleaned up, more homogenized access systems, fewer peering, fewer interconnections, more efficient network connections, but also, and this is the important point about economies of scale. So leveraging our infrastructure in a better and more meaningful way. And by that, also focus on standardization, leveraging our existing economies of scale. And last but not least, also enable an efficient backbone and transport production structure. So this is what we're trying to do with the harmonization of our technology and IT platform. This embraces the BSS and OSS systems, which shall enable us to move from a TV cable operator towards a scalable and efficient ISP. Also this is really the purpose of our harmonization program called OneNet. The second priority we have, of course, is to invest in the best network to an efficient and well-minded CapEx envelope, which basically implies open access, which implies a structural deployment cost at a very competitive level and especially our dense urban MDU focus. So basically, our networks, our infrastructure today, is located very much around urban, dense urban areas and focusing very much also on MDUs. We are not focusing on SDUs at all. And lastly, it's also important to note that we have 85% of our network deployed in a very efficient star architecture, facilitating a pretty easy approach to upgrading towards FTTH. So migrating from a historic DOCSIS, HFC structure towards a future-proof, scalable FTTH structures. So this is our purpose. So we are not building on a greenfield. And last but not least, on Level 4 networks, so the last mile in the households, we -- of course, we see overbuilding but likely we will overbuild ourselves as we are migrating from an existing HFC infrastructure towards a competitive FTTH infrastructure. So this is in our main footprint the key. On the right-hand side, you see the conversion [indiscernible] the majority is on HFC footprint. And over time, we are gradually migrating towards a 50% or so FTTP, FTTH structure with the residual of HFC. But these 5 years are critical, as Markus also pointed out to keep the momentum in these footprint areas. But this is our second priority. Our third priority really is a little bit on explaining to you how to build these networks. You can see on the left-hand side, some competitors who built mainly homes pass, which means they are focusing very much on Level 3 network build, don't focus very much on Level 4. If we build networks, we mainly count homes connected, which means Level 3 and Level 4. Cost allocation here is roughly 50% on Level 4, 50% of Level 3, which is the wide area network. And this enables us, if we are building our existing footprint on a very attractive cost per homes connected, which is very competitive against other players in the German market, especially in urban and new areas. This means we are not going for greenfield. This also implies we are not going for new build areas for complete new build areas. And also, we're using our in-house building capabilities, including our own capacities on layout works. And lastly, it's also important to that this, of course, includes -- excludes -- sorry, excludes price inflation for material as well as labor costs. But this is important for understanding the building plans. And lastly, it's also important and we will show you in a minute video, really practically how this works. It's important to note it's all about processes, so very efficient process in-house, but also with our civil works partners. It's also important to note to think and plan into clusters and really execute those clusters and that's how we want to show you in that video. So firstly, you start, you see an urban typical German urban structure with multi-dwelling units buildings. Here you see a street cabinet, which basically is the closest infrastructure against the house. And from there, we build to the basement. So from the street can we build the fiber line to the basement that it drives in the basement unit. Here, we connected to the building distribution point, the fiber connection arises from the street cabinets. And in this distribution point, we are slicing the fibers towards the homes, which is located in the building. We are splicing the fiber. They're preparing everything in the distribution to make sure the fiber line can be moved up to the houses to the living rooms. You see the pipes. We ask for authorization to modernize the cable network towards the fiber network. So we are asking each and every tenant. Here, you see they are trying to -- the workers trying to install the fiber line in the apartment. Yes, our colleague is preparing the fiber termination point, which will be installed in a minute in the wall of the apartment. That's the wallbox. So we are installing this. The hole behind is for the fiber line, which will very soon be directed towards the basement. Here, you can see the fiber line being injected in the wall. Here, it arrives very soon in the basement through an old chimney. It can also be a duct, a cable duct, which has been laid out in decades ago. So this is also the technicians notice local facility very well, and this is also part of our asset. We know the plans and the houses very well. This is a big advantage. So the technician acknowledges the fiber, connect to the distribution point in a minute. So that the guys up in the apartment can prepare the fiber termination point as he just started in a minute. Now the termination unit will be connected, and we are testing on top of the unit, the ONT, the optical network termination point. So this is the last point where the fiber optical cable terminates. We are connecting the CPE, it has been provisioned and activated in the back end. And here we go. That's how we work. And this is pretty easy. I think the point here is our key asset is we know the house, the plan, we know the local cabling in the Level 4. And this is why I'm saying Home Connect means it's Level 3 and Level 4. Most of our competitors working Level 3 only. And this is where the connection happens on Level 4, and this is why it's important to understand this mechanism. Our fourth priority, if you can switch the page, is what we call adjacent or complementary business, if you move to the next page, please. Let me -- sorry. I'm sorry. We are moving to the complementary business, adjacent business. So we have 3 areas. One is our TV offering. STV is part of our DNA. We have a competitive state-of-the-art IPTV streaming solution ready, which Jochen talked about, which helps us to innovate at marketplace as well for our customers. Secondly, we have develop our B2B capabilities in a sense that we're driving very close technology, B2B solutions. We develop the solutions, i.e., data center solutions. We have some significant data centers across Germany, which we can utilize by connectivity, but also solutions. We are connecting with our partner sales channels. And lastly, on our first priority, I told you about the harmonization of our network. We are expanding our B2B footprint across the entire Tele Columbus footprint, and to make sure that where we can offer B2B and B2C and wholesale product is a consistent footprint. And I think this is our main aim on the B2B side. Lastly, let me mention that we are upscaling our wholesale activities with an action plan to wholesale HFC as well as optical fiber lines. We have 2 major wholesale partner on the HFC side, Telefonica [indiscernible]. On the bottom of the slide, you see potential partners on the fiber side. As we are speaking, we are negotiating with some of those contracts. And our aim is to connect additional customers on the fiber line for wholesale. That's the priorities on the production, IT and technologies that I want to share with you. And with that, I hand over to Nicolai, who will tell us about how we all back this up with financials. Thank you.

Thank you, Michael. My name is Nicolai, and I am currently acting as interim CFO since last August. I'm supporting the company, and I'm happy to share some insights on the business plan. And as we've mentioned, most of it is just a summary of what we've previously and it's just being translated into the numbers and that is what is important also to the financial markets and the financial community. So if we look at the main business plan value drivers. And on the top, it's basically related around the IP homes connected. And we're coming '23 from the 4% we've seen previously on FTTH, we're moving into 11% 2024 and targeting around the 40% to 50% FTTH and as Michael just mentioned. And we're also focusing on the 2 million to 3 million core footprints that is basically for us, the main ground for value creation. And on the IP penetration, when we looked at what Jochen was explaining on the retail side, on the one hand and on wholesale, just for Michael. We are just starting with the wholesale program. Basically, it has been set up. We have the first customers on board on the networks, and this is moving on. But previously, retail is the main focus, shifting on the sales channels, reaching around 30% plus in 2024 and then moving on into the penetration towards the 50%, 55%, 60% in 2028. That is the main underlying business plan value driver, which then also drives the revenue mix, which is shifting and we've seen it in the past being more on the TV side with the majority now switching it that we've already surpassed TV with the Internet and phone revenues, expecting around 40% this year. And then moving on towards 60% in the year 2028. All this basically drives the revenue, the top line coming from around 460 target this year going into the 600 and 670 towards 2028, with EBITDA almost growing by EUR 200 million from EUR 200 million to EUR 400 million. That is the target. And on the CapEx ratio, we are now in a very CapEx intense period of this company. We've spoken about fiberization that is most of the CapEx goes directly into the networks but we also have CapEx, which is related to our B2C sales activities, mainly commissions for external partners like Jochen mentioned door-to-door, retail point of sales. All this is being -- not being on our payroll, but we pay success-based capital. And then we also see CPEs, which are related to our growing business. And then if all this works out and goes into place, we finally move from spending money to making money and try to get a cash conversion up and running towards 30% plus as of 2028 going forward. And behind this, and I'm not going to read all this, you have access to the slides, but it's just a summary. What happens on the top line, we see CAGRs that are quite impressive, about 15% on IP and phone, reaching the penetration of we said 40-something percent in 2028. We do see an uplift on CAGR. One is volume, which grows, but the other one is also that ARPU is growing. We expect around about a 2% ARPU uplift, and this is driven by up-tiering to higher speeds by upselling from the base management and also people coming in actually using the highest [indiscernible] product at reasonable prices, but still helping us to improve and grow ARPU. Wholesale we mentioned it's going to be quite a substantial business, around EUR 40 million of revenue contribution. And we do see an ARPU growth of around 4% year-on-year, also related to up-tiering and the setup the way the contracts are related. On the TV side, we currently have the split of round about 65% individual and 35% bulk. Now being tackled due to the regulation change that we've talked about, we do see ARPU declining on the TV side. This is going to be something that is happening also out of the bulk migration. And in the end, we support and Michael just mentioned it that we have this NGTV product on and it is something to strengthen the TV proposition and also help to slow down the TV ARPU decline. B2B, we mentioned as well, quite an important section as the fourth one, also with challenging CAGR. On the revenue growth side, we expect around 8% to grow year-on-year. And then we basically focus on a different product mix. We had a reset up of the sales team we basically rearranged. We integrated also sales activities between our own B2B subsidiary, also interlinking it to the housing association customers sales. So this all helps to better work as one company and improves the situation. On the cost base, we basically have the target to keep costs rather stable and actually a bit declining with 2% CAGR going down. We have had investments into people, into organization and processes in the past couple of years, and we need that basically to prepare and continue with the growth assumption on the top line. We have invested in IT systems. We will do so more and we will have the option to basically support our increasing customer base and in the end, have service costs growing modestly as we have a bigger base, you obviously have bigger sales -- sorry, customer sales costs. And this is, however, scaling and we are doing it on a moderately basis. The fiber extension will also help to reduce our service and maintenance costs. Some expectations is that you have roughly 50% less cost on fiber versus HFC. And we've also managed to reduce our external signal delivery fees also in relation to the core footprint that we're looking at. Mostly -- and most important on the cash and on the spending side is CapEx. We have roughly EUR 700 million on total CapEx investments into the network between '24 and '28. We talked about round about 900,000 homes connected to be fiberized by '28 at round about EUR 650 per home connected. And that is basically driven by what we said. One, we have the in-house construction team that Michael was already referring to, and this is somehow protecting us against very inflationary labor costs. We will have wage increases as well, but maybe less than compared to external. And then obviously, the high density of the homes passed with the very low distance that we have to cover on the public ground. And in the end, we somehow expect that the CapEx intensity that we currently see, which is well above 40% or more, that this will decline to somehow at around 30% after '28. And then once the rollout is completed, let's say, more or less in 2035, the CapEx intensity should go down to normal levels that you would expect around 15%. With that, that's pretty much the sum of all the strategy, summing up in the numbers and looking into the business plan. I would again hand over to Markus, who will give some introduction to the NetCo and ServCo situation.

Thank you. So here, I am back again. Yes, NetCo, ServCo, by transforming or doing all this work we presented before, we are in the middle of doing what we are now analyzing because we are concentrating a lot on sales, on our sales department, on service. And coming to that, it is exactly that what we might then allocate to a ServCo, we are concentrating on the NetCo, on the B2B business, on the wholesale business and so on. And this is exactly what we are now or later on in our first ideas presenting to that would link to the NetCo. But let's dive into our thoughts on that in a more detail. So what are the backing of our thinking about NetCo-Servco? Of course, the separation of the network and the service improves access to capital. So what we are thinking about is that our refinancing is done and the situation we are in with the refinancing is good. It could be better out of an operational perspective. And this leads us to our thoughts to the value levers to the NetCo-Servco split. So simplifying also operation business is what we are doing and this is what we are working against. Market opportunity. So when I'm looking into the market opportunity, the window of opportunity to increase focus on this NetCo side and the ServCo side is exactly that -- last week, a very important week for Germany for operators like us, there was [indiscernible] in Cologne. So the biggest crowd ever you have talked and meetings every half hour. And funny enough that a lot of our ideas, which we are linking to NetCo, ServCo, we have questions about or we have meetings. So we get questions about whole buy opportunities. We, as do you want to do whole buy on our network. And this is exactly what we are going to dive in that -- into that Netco-Servco split. Nevertheless, the proven concept of Netco-Servco is a proven concept on the one hand side, definitely in the telco industry on when you look at energy and so on in Germany and Europe wide and NetCo-ServCo is a proven concept as well. I also pass that chapter. So access to capital, very important for our business to fiberize our business and this is where we want and might be have an opportunity to attract new investors, infrastructure investors. And this is why we are doing that process. I mentioned before the wholesale and whole buy opportunity is in the market. It is also in the market. I can -- next page, I also would speak about it. Some of the IP operators in Germany are now thinking, I'm investing into the business or doing wholesale business. I'm also going into the FTTH network, wool areas when I do it in dense areas like Tele Columbus, no relationship to housing industry, how important that is, we mentioned earlier on. So it is a window for wholesale customers. And this is why we also are aiming to split up and think about splitting up to have the wholesale unit in the NetCo and the ServCo doing business with hold by opportunities. Of course, the business is changing in Germany. Of course, somebody identifies that EUR 2,400, EUR 1,800 per household with a fiber take-up rate between 10% to 20% in rural areas are not the optimal point to do. So there are consolidation opportunities but not only there throughout the bulk migration, smaller cable operators on the market and also with this split and this new interest in CapEx facility optionalities are also in the market. Solution for operational goals. So key operational task focus on that topic, focus on that topic, we already do it, but this split is like a catalyst doing that for the future. And here's what I mean, how the market is now trending in Germany? And what -- in what atmosphere we are right now in. I'm just missing the English word what I want to impress. So FTTH demand in Germany is there. So the demand is already there. We see that the take-up rates are a little bit lower than expected. The funny thing is when you had talk somebody, I had a -- how companies have access to multi-dwelling units, that was the reason why the penetration might be lower for one company in Germany because they don't have access to Level 4 in that unit. And for that, they deploy in homes passed on FTTH, but penetration is lower without access. Funny enough because we have this access. So that -- the good thing is we see the demand for higher bandwidth in our housings right now. You saw our tier mix was 50% and higher on 500 or 1 gig. So the demand is there. So story funded for the demand deployment pace. We see actually really that the deployment pace on rural area is dimmed down. And we are on the same pace level in dense areas, and a shift to urban areas is seen, which is good for us because here we are playing. And here we know also how to deploy Level 4 like Michael showed you in the video. Same focus inflation has an impact on rollout costs. With our rollout costs, we are positioned best-in-class in Germany with our MDU approach. So really attractive also for that split. Housing association demand is still high. So the percentage when a tender or if talks with housing association, I would say 95% is roll out fiber. We want to talk to you, Tele Columbus, Christian mentioned the pipeline of housing deals before. And like I said, wholesale penetration or wholesale deals are more likely to sign because otherwise ISPs have to build by their own. And the whole environment plays into the hand but wholesale, maybe with -- or definitely with Tele Columbus, is no alternative to that. And this is better recognized when we put it in our NetCo company. Some examples from Europe or Germany in the past, but you know it better what happened in the past on NetCo-ServCo splits, a lot of topics to do. The environment, the companies who are doing it are important, but we are willing to dive into that topic during the course of the year to see a NetCo-ServCo split for Tele Columbus as a clear alternative for the future. This is important for us to mention it in this rounding of the Capital Markets Day to you. Coming to my concluding remarks and then open up the question-and-answer session. So what -- we are 1.5 hour, what we told you in the last 90 minutes. We are transforming our network from HFC to FTTH. Contracts are signed today in the next 3 to 4 to 5 years. Deployment will take place in the following years. We have 2-site approach, we will ramp up our penetration to market level. This is a growth opportunity of the company. We are delivering, I'm completely convinced to perform on that number on the DOCSIS 3.1 side. Summertime is coming. So towels needs to be put on to the pool. So we will do it on the FTTH networks definitely because we have the relationship to the housing association and everybody gives us a tick in a box on Level 4 never will be there an overbuild on FTTH, who has this towel placed in a housing association for Level 4 build-out. We will deliver the FTTH network for decades, for 50, 60 years into the future. And this is exactly what we want to deliver on. We will, by that, transform our business. TV service revenue will decline, will be over paced and overachieved and overcompensated by IP growth because the demand in Germany is there. The demand of our customers is there, our product positioning is right now best-in-class. Connect tests show it and what Jochen mentioned before, a really perfect work we have did in the past and we have to do in the future. So what our product and marketing team and our sales team are really doing is concentrating on the market, adjusting products on a daily, monthly, quarterly basis, react to competitors and be first in the house. In that house, you remember these houses here, my competition takes place. And here, I'm the service, the price and the speed leader. And for that penetration goes up and later on with the perfect base management cross and upsell opportunities will be delivered as well. So like I mentioned before, housing association, the whole building, the network rollout costs, these are our competitive advantages of Tele Columbus in the German market. Management is changing the company. We are changing the company in the right direction and I did it in '23, we'll do it in '24. Our strategic plan is clear, needs to be adjusted on a monthly, quarterly basis, of course, how the market changes. For that, exactly what I said now is the window of opportunity also to look at the possibilities of a NetCo-ServCo split. And this is pillar number 4 of our strategic plan to deliver on that, to analyze this and then take a decision, discuss it and then take a decision. Okay. This is the presentation right now and we are now happy to take the Q&A session. Idea is that, first of all, so my colleagues are in the background. And when I'm struggling with answering every question in detail, I will ask one of my colleagues or the team to step in and to come beside me here. But I would say I see or definitely I hear you, and I'm ready to take questions. Hopefully, when I take them -- most of them then question 1, 2, 3, and help me if I forgot something in answering your questions, and please repeat the section for me. We can start if you are ready too.

[Operator Instructions] Our first question today comes from Polo Tang from UBS.

Thank you very much for a very informative presentation. I have 3 questions.

No, I can't hear nothing.

Can you hear me?

Give us 1 second to get an order here.

Okay. Can you here me now?

So here we are. It was just that the speaker was out, we need to solve that in that perfect technology company we are in. So Michael jumped in and everything is fixed. So start.

Okay, great. So first of all, thank you very much for the very informative presentation. It's Polo Tang from UBS here. I just have 3 quick questions. The first question is on fiber build costs. So on Slide 38, you highlighted that have fiber build cost per home is lower than your competitors at EUR 650. However, one thing which I don't understand is why our costs are lower than OXG. So isn't their situation very similar to yours? And if their footprint is significantly larger, should they be getting benefits of scale. So can you maybe comment on what the differences may or may not be in terms of build costs between you and OXG? Second question is really just in terms of the barriers to entry. So on Slide 15, you highlighted your concession agreements with the housing associations provided a high barrier to entry against overbuild and infrastructure competition. But can you clarify what proportion of your footprint is protected through these long-term concession agreements. So I think you said 70% of your footprint with large housing associations, but are all of these homes covered by concession agreements or only a portion? And my final question is really just about Deutsche Telecom because they signed an agreement with the GDW or the Association of Housing Associations last year to make it easier for them to access MDUs. So are you seeing any signs of Deutsche Telekom being more active in terms of rolling out fiber into MDUs and housing associations?

So the EUR 650 million, let's start me with your first question. And Michael, if you step in when I'm long on that side, is most linked to our ducts already laid out in the ground. So I mentioned also the figure that deploying fiber to a building block of a housing association means exactly also using our ducts, and then to jump from that point where the ducts ends to the housing block in the dense areas is only by 79%, I think, is figure 1.9 meters. I don't know this was an exemption of the OXG numbers because what I -- so what -- I think it's a mixture of build-out costs compared to the OXG. And these numbers we also see on the OXG numbers or information from Vodafone. So we can reform for our number, which is lower and linked to the ducts. The other point is that also with these costs, we do it a lot of the wiring in-house we do in -- with our own people. So it's also a mixture of how deploying the stuff. So doing it by our daughter company, RFC, where we have 200 craftmen on our own rolling this out in a perfect way, bring the costs down. I would say, so Deutsche and overbuild is goes into the right or same direction. Overbuilding, there might be that a competitor is in the basement of housing association with the connection point on fiber, it could be. But at the end, it is a level 4 operator who wants a Level 4 for the FTTH network. And this is what I mentioned before. Every housing association, every association of a housing company like the GDV as well is saying to us, to everybody, there will be no overbuild of a network in the Level 4. There might be overbuilt in the Level 3, but on the fiber network side, FTTH will be 1 network on the Level 4 side, so in the housing association business. All of our businesses are linked to concession agreements with housing associations. Every -- so the concession agreement means that in many cases, we are allowed -- first of all, we are the network operator in the Level 4. We are deploying the DOCSIS 3.1 network or we are deploying the FTTH network. For that the housing key account managers are signing these contracts. And then we are also servicing the network. And in the future, we are also the partner for the Housing Association who is managing the wholesale business because we guarantee open access to that. Now a lot of housing associations are stepping back and say, with that, I don't want anything to do for the future, and please handle it for me. Coming to your telco question, the [ GDV ]. Of course, there are several cooperation peoples, I would call them in the market. From Vodafone, from Tele Columbus, from Deutsche Telekom, who are signing with also with the [indiscernible] right now, Deutsche signed a contract, to be honest, in some places. These are signed contracts because competitors already signed these contracts years ago in different ways. So for us, it's a sign, yes, we are also here in the market, and we are aiming for housing association. Okay, they are entering the market since years. They are in the market, of course. But we are in the market since decades and signing up the contracts like Christian said, how we bring these contracts into life on fiber as well. It's a competitor in the market? Of course, it's a big competitor. But looking at our base, we are looking for fiberization of our base and hunting opportunities to grow, hopefully, in the future as well that base with a different financing.

The next question comes from James Ratzer from New Street Research.

Markus, thank you again for the presentation today, very much appreciate it. If possible, can I ask 3 questions as well, although I do have a much longer list. But yes, so the 3 questions I had, please, were at the time of the Q4 results, you announced that you had 50,000 customers who are actually taking your FTTH product. What I'd love to understand is how many of those 50,000 customers are brand-new customers to Tele Columbus and how many are existing customers who have consensually upgraded? And the second question follows on from that. The reason why I was asking that first question is, I'd just love to understand about the business plan you've set out today and that the Q3 results last year is very focused on FTTH. And I think you haven't mentioned the phrase DOCSIS 4 at all. And I'd love to understand how potentially the new TV NPV of an FTTH business plan, which has high costs upfront versus maybe a DOCSIS 4 business plan, much lower upfront costs, what that does to your longer-term retail share, especially as you say any fiber build deployment, let's say, Deutsche Telekom would have to be open access. So even if Deutsche Telekom did fiber in a housing association in the longer term, your pure brand would still be able to get access to those customers. And then the third question I had, please, was just regarding the EBITDA number you gave for today, EUR 48 million, I think, is up 10% year-on-year in the first quarter -- sorry 9%. I think to hit the EUR 220 million guidance you've given for 2024, you'd need to do 15% EBITDA growth in the following 3 quarters. Can you just talk us through what gives you the confidence to see that acceleration, especially as we're likely to have some bulk TV losses coming?

Okay. James, happy to take your question. So FTTH, to be honest, how many of new customers on the FTTH network because there's 50,000 based on the FTTH number of 100,000 is a mixture like it is also shown before. It's a mixture out of new build homes. It's a mixture out of infrastructure projects and it's a mixture out of overbuilding our DOCSIS 3.9 -- 3.1 numbers. I would assume we have to go back to these numbers that these 50% penetration are mostly new customers because when I'm looking in, that's a mixture out of these pillars. And in the last years, FTTH was more than on the infrastructure projects than the new build. And now we are starting off of overbuilding ourselves. So coming from this basis, the 50% is more on that. The good thing is the -- and this -- then also leads to EBITDA growth to your last question. Is that the growth opportunity on IP is definitely there. We are below 30%. And this is not only -- and you are exactly right also in your -- a lot of in your reports before, we have a 2-step approach. We are concentrating on DOCSIS 3.1 in penetration rising because coming from 25%, we need to -- we have to break through that 30% penetration later on to that 35% penetration rate and then to 40%. At the same time, Christian is signing housing contracts on FTTH. Michael is building them. And then we have a parallel network and transforming customers or signing new contracts on the fiber network. This is the strategy. But nevertheless, the penetration upside and like you see the portion of our network, which remains on DOCSIS 3.1 is in 4 years, still 50%, so penetration rising in that topics on this point is very important for us and is linked to that. To be honest, DOCSIS 4.0 or whatever, exactly in the U.S., a proven concept in Germany. The market, in that case, is also driven by the housing association. So my first customer, I have to sell a contract is the Housing Association. And in that case, the demand for upgrading to DOCSIS 4.1, the demand is for fiber. Like I said in my other chart, Michael, as well, the cake is now eaten or signed, I would say, in the next 4 to 5 years. So we are signing fiber contracts and not DOCSIS contracts. Doesn't mean that fiber is rolled out immediately. It will be rolled out over the years. But it is a complete drive in the market in Germany to fiber more and more and more than to DOCSIS 4.0. And in that case, we overjump DOCSIS 4.0 and migrate from DOCSIS to fiber, then to move from 3.1 to 4. This is, I think, the answer to your second question. Third question, I think I referred to our Q1 results call deeper to that on the EBITDA growth. We see the IP growth is taking place. We have several measures on to that and stick to our forecast right now and we'll deliver more detailed numbers on the Q call coming next week and than 3 months later.

The next question comes from Adeel Shafiqullah from Sculptor Capital Management.

I wanted to get your more thoughts around the rationale for the NetCo and ServCo split and specifically on any impact it has to the refinancing that you've already completed?

The impact on the refinancing is we have the opportunity together with our lender community, of course, to have these thoughts and these analyses. We will not do something in hectic or whatever. There is no reason for that, because we already finished that refinancing. And we analyze this together with our shareholders. And then, of course, together with our lender community, what step is the right one and what step we want to take here? And for this, there is no pressure [indiscernible] and have to based on really rationales we want to achieve with that. And I think this is the point where we are standing right now.

Understood. And with respect to accessing capital and optimizing the access to capital, the ideas that as of now, you have a fully funded business plan. And the idea is to basically optimize the cost of that capital rather than you would be needing more capital for the business plan. Is that right?

This is right, but I also mentioned there are opportunities right in the market. And this is -- our business plan right now is focused on transferring our current business into the fiber world, but there are growth opportunities. And in that case, we are growth opportunities in our current footprint covered by our business plan. But when I want to go outside, I see an opportunity in Berlin to do more here. I then have to think not to do it somewhere else but the question is could help a NetCo-ServCo split to do both when the growth perspective is there. And this is what we want to see because that the good thing is there is a kit on the block right now, which is Tele Columbus, which gets questions, can you help us? We are in -- we are an old cable operator, bulk migration doesn't fit so good into our concept. I'm old enough to sell my company whatever, there are opportunities in the market. And with my financing right now, I'm a little bit -- I can dance here, but not there. And this is also an opportunity we want to discuss.

The next question comes from Peter Jurik from Tresidor.

I'll just have a few. I guess the first one is look a little bit of a housekeeping question when it comes to the EUR 650 cost per homes passed. And unfortunately, maybe this is down to me, but I keep getting a little confused. So is that EUR 650 million -- EUR 50 per home passed, just the cost of the L3 connection or is that a cost that's inclusive of the L4. Simple question.

Including Level 4.

Okay. And so you're effectively saying the reason why you're able to achieve that is because your Level 4 is predominantly abducted already.

The Level 3 is predominantly deducted as yes, you're right. And yes, and what -- now it's -- because your 650 homes passed is not wide as well because when we speak about 650, it's homes connected because like you saw in the video, the ONT is in the building? Or is it prepared that it could be very fast in the building. And the Level 3, which is included into the cost has some different multiplier than to pass but Michael step in and help me on that side.

Let me step because it's a very important question. So first of all, 650 means Level 3 and Level 4. The component here is more or less 0.5/0.5, 2/3, 1/3, and it implies all the active and passive cabling, plus all the IP connectivity you would need to install on the street cabinet. So really, it means the entire connection from street cabinet to Mr. Smith in the fourth floor on the right-hand side. The challenge here is that we avoid civil works, which is for competitors, this is the biggest cost item. Civil work typically is 90% of the cost. We can avoid this because it's not heavy works. What we do have is cabling on Level 4, which is again carried out by our craftsman on -- in the staircase. There are new technologies which you can apply, which we tested. But more or less, it's a Level 4, Level 3, cabling, active passive materials and some degree of civil works as it is an average calculation. But 650 is also for this year, we saw a proven KPIs, that this is the realistic picture on our existing footprint. Of course, it looks a little bit different if we do new build and entire new enablement of new housing associations.

And then just for the avoidance doubt, so it excludes CPE is -- would be the...

It excludes CPE. Yes. Yes. It excludes CPE. It includes ONT.

And the only sort of -- I guess, you must be making an implicit assumption of something like 50% penetration? On the...

It's 40%, I think.

Okay, fine.

Yes, I step in. It's a mixture then of -- out of TV retail and the wholesale, which steps in over time because wholesale is then also focused on the fiber footprint. I think -- sorry, because we are also in the middle of, again, in these numbers, I think what we presented here was the 45 and 15 split. So 45 TV retail and 15 wholesale to the end of that timing period of the business plan right now. Yes.

I guess what I mean is just for the avoidance of doubt, is 650 is not the average cost, because you won't be doing -- you won't be doing the last mile sort of going into everybody's home, right? So it's not...

No, we are. We are. So I signed a contract with the housing association in Berlin, about 10,000 households, and then I have an average, when it's my housing association I already did in the past by DOCSIS 3.1, then I will homes connected by FTTH, I have the fiber in the streets in Berlin going to that to Charlottenburg in Berlin, where these housings -- 10,000s are, I do the wiring in the Level 4 like you saw in the video, in every of these 10,000 flats by an average cost of 650...

Okay.

Level 3 and Level 4 without CPE.

To give a little bit of dynamics, there is the ONT, we're also going to be do twist on part where the fiber terminates plus the IP conversion happens. Our assumption is, at the moment, that's part of the 650. Even discussing to, for example, just place a passive cap on that part and send the customer once activating this twist on ONT, the active part. So this is even a process discussion we are having to reduce costs further. So what I'm saying here is you're not the end of the line. You are trying to optimize further when it comes to cost materials and so on. As I said, it can also be higher, it can be lower. It depends on the case. But it's an average calculation, including ONT, excluding CPE.

Okay. That's very clear. And in a similar vein, kind of a little bit of a clarification, when we think about your L3 network, 4.8 million homes passed, 2.3 million homes 2-way upgraded, connected. So how should I think about the proportion of L3 that is currently fiberized, or rather that needs to be fully upgraded from whatever it may be to full fiber?

Good question. I think we are pretty strong on L3 fiberization. So we have a lot of fibers already today running into a sort of Clear TV DOCSIS infrastructure because we are terminating in very often cases the fiber line in a larger sort of MDU, right? So if you will, it's a sort of an FTTB sort of installation of, FTTC. But I would say it's 2/3, yes? So 2/3 of the L3 is fiberized, and 1/3 is still sort of on a coaxial infrastructure base.

Okay. Perfect. And then what -- I had just 2 more questions on the TV business actually. One is on Page 28. You had the stat of 40% -- over 40% of migration ratio. And I just -- I wanted to better understand what this 40% is. Is it sort of you're expecting to get to 50-60 by the time the move has to happen, and you've already done 40%? Or like I'm just trying to -- I don't quite understand what the 40% refers to.

So, [indiscernible] on what page you're referring to?

Page 28, the [ 110,000 ] plus 40%.

Okay. Let's go -- let's go to page again, let's wait, to turn it around, I haven't. Let's go to Page 24, please. And here, we are referring these 40% to the pillar of Q1 of this 110,000. So it's a lot of 40% because the page before, go to 23, please. I can do it myself, sorry. Here, we have this 42% in bulk. And going to the next page, is that, right now, this is a snapshot of, I think, last week. We are in the position to say that in this cohort of 110,000 households, we are transformed, we -- I think the actual number is 42%, we are by 42%. Next week, hopefully, we are by 44% or 43%, whatever. We are jumping into these households every month again and again with mailings, with housing associations, again, with door-to-door sales, customers are coming into our shops, and so on and so on. And this we called penetration rising on that. And at the end, when the transformation process is ended, the migration process, which we are assuming end of this year, Q1 '25, we estimate a migration of inch from bulk into individual by -- between 50% and 60%.

Okay. So the right way to read this graph is that in Q1 2024, the 110,000 households will be switched off from bulk and you're working through that. The 110,000 is the switch off. Okay. So that's clear. And the last question I'll then ask on TV is, it was at the end, you mentioned the business plan has an assumption of TV ARPU coming down a little bit. I mean, that -- I guess, that surprised me because I would have assumed that when you switch from bulk to individual, you'd probably have a little bit more of a premium uptake. So what's the underlying assumption? Are you just assuming that a lot of the bulk turn on to individual will be at a very basic TV level? Or are you lowering prices to promote uptake? Or what's kind of baked in?

It's a little bit a mixture of all. What we see right now in the competition in Germany is that the prices are on TV. This is also land grabbing of competitors in this migration phase. But right now, we see that the TV prices overall are, in Germany going down, coming from our level more a little bit down on for that. We adapted that also in the business plan or adjust -- or put it like the competitors are doing as well. So we put it in that plan on a lower level.

And that's the assumption that you have going forward? I mean, do you -- is it -- are you making money on that assumption? Or is it more just or I'll try to have somebody on triple play so that there's less churn? Because when we quite speak to a lot of other companies in Europe, the media business oftentimes is sold for the cost of content. So I'm just wondering how it works for you.

I think it's more and more moving also into the bundle logic because a first approach into the household will be in the future more the IP product than the TV product. And this is what we're just changing into our business. In former times, it was TV, now it's IP. And then bundling it with that, and that brings us these ARPU mixes.

So is it -- I guess, just for rewarded to that, is it fair to assume that there's not a huge gross margin on TV on a go-forward basis?

Yes. On the pure TV side, it's a little bit lower than the margin is when on the basic TV side, higher. And the mixture out of that is then the margin we are seeing on the TV side, yes.

We have some questions from the phone lines. We have a question from Stefan Binder from Palmerston Capital.

Can you hear me?

Very good. Thanks.

Okay. Perfect. I have basically 3 blocks of questions. Some of them are probably just some background. So if I look at Slide #31, which is basically the slide where you show how many homes you've connected, and contracts won. I understand the business plan, you want to basically upgrade 900,000 homes until 2028. It seems like you -- with your approvals and won, you're already at roughly -- you're not too far away from 600,000 if my math is correct. What I'm curious on is, can you give us a little bit of guidance how that pipeline number will actually change over the next few years? Not the actual fiber build, but at the end of 2028, because you mentioned the cake is going to be sliced now, what is your expectations on how much of your 2.3 million homes you have actually secured?

Yes. I will never speak against the German government because the aim of the German government is to reach the fiberization of Germany to near to 100% in 2030. From our company, I would doubt it, to be honest. And exactly we are aiming to address -- left to address this 1.6 million here in the next 3 to 4 years. There are customers in this box who are just don't want to change the running system and are happy to stay on DOCSIS, to be honest. But we are expecting to migrate, like I also showed on the slides before on the gross profit slide. I would say it is 80% maybe in the future, will be 80% to 90% will be fiber-wise. Contracts signed with housing association, I would expect to reach that in -- so we are now in '24, '28, '29. So something we will end this process between '28 and '30, 2030, I would say. And then the build-out, contracts won and open to build means open to build, there are numbers in which will be built in '28, '29. So that these numbers of 600,000 you mentioned right now is not linked, that these numbers are exactly this 900,000, which we will build until '28 or so on. So there will be also in that number of 100,600 customers who are coming up next year, the year after, to be built in fiber. So it's a mixture out of that.

Okay. And so you said basically, you signed contracts now where the build is kind of like linked to the renovation of the housing association, which is coming in the next few years. What I'm curious is, out of your 2.3 million lines, I mean your competition also speaks to the same housing authorization to the same degree -- or to some degree, I guess. Out of your 2.3 million lines, if you have any of your competitors signed up a housing association like going forward like 3 to 4 years, have you basically lost any of these -- your future tenders against your competition at this stage?

Of course, in that business, you win, and you lose customers. To say no would be a lie. And of course, we lost also contracts out of it. But we just spoke about a contract we recently -- or recently was last year, one migrated to fiber and now have tremendous penetration upsides out of it. Christian just mentioned it this morning, that was 1,800 households, for example. And this is a moving target, and this is what I mentioned that we were able in the last year to stabilize these homes connected number. And this is important because the fluctuation isn't so high. So you really not lose 200,000 -- 400,000 and gain 400,000. It is you lose here 40,000, you gain 50,000. And for this, it's near to be stable. But that happened, of course, yes.

I mean I understand, obviously, you guys are a little bit more capital constrained than your competition, I guess, when it comes to planning your CapEx budget. I guess it is fair to assume you're not going to keep all your 2.3 million lines in the next 10 years. You're going to build some of yourself and some of them your competition will come in. I'm just trying to get a bit of a feeling where this number is going to shake out in the midterm?

In our business plan, it is -- our assumption is that we are for the future on a stable level on that. So this number is -- our expectation is that this number will not drop below 2 million or whatever. So that we are quite stable on that number. Because, like I said, and this is also linked to really that close relationship. So 750 customers are for -- responsible for 70% of our footprint. So here, we are really close to our customers. And our -- like Christian said, our hidden champion in our business is the housing association, which promotes us when we are in and selling our products. This brings a boundary or a relationship to the housing association, which is more than a usual relationship, I would say, I would name it. And this is special. And to be honest, this is also the topic why it was so hard in the past and, to be honest, also right now, for entering into that business of new competitors, even for Deutsche, on knocking on the door, to be honest, yes, they gain customers, but not every customer says, "Oh, wonderful. I love Deutsche. Come in and find out." No, that isn't the topic. And this is what also the reflection or the feedback we get from our customers.

Okay. Can I ask one more question? I'm really curious how the bulk migration of actually works. So obviously, I understand you sell free TV in a convenient way for your customers. But this TV signal they can also get via Internet TV or satellite. So do you actually switch off the customer and the customer loses the existing TV access, and then you try to win them back over the next 6 months? Or do you let him -- leave him on the signal and then you kind of like really start marketing it, "Well, we're going to switch off if you're not going to sign up," how does it work actually?

So right now, the customer -- I don't know if I get your question right by free TV. Right now, the customer has to pay for that TV via his auxiliary costs, and this is not possible anymore beginning of 1st of July. So the process right now is the selling process of a migration process that the housing association key accounter goes to the housing association and says, we have to have a concept, and here is our concept. How we migrate you because you decided to switch from bulk to single contracts, for that, in many cases, we signed new contracts. We signed DOCSIS contracts, but we also signed fiber contracts. And in that case, here's our migration concept. First of all, 5 to 6 months before the migration date, a letter from the housing association goes out to the customer, in some cases, even with a contract from us, and saying, guess what, there is a change, but there must be no change. Just sign here, bring the contract to the office of the housing association, which is there and there, or bring it to the Tele Columbus retail store or whatever, or send it to that address. And this is our first wave of getting customers from bulk to TV. A second mailing goes out. A third mailing goes out, either with or without the housing association. Then that to do a retail online linkage to housing association web pages and so on steps in. We have sessions where people are sitting in the offices of housing association, a mailing goes out, here's a question-and-answer session with our sales guys. Come in, and they answer your questions here. You can sign a contract and by that, there is more than getting TV from Tele Columbus, it's also Internet you can get. This is step 1 in front of the -- in front of migration date fix. And this is what you saw in our pages by 40%, 20%, 30%. Then the final date comes. And then, again, door-to-door goes in, and all our salesman are that comes in and say, "Guess what, dear customer, the migration was done, you have now to sign." And then together with technicians, we are able to block the single flat via our Star network, and we're also doing disconnecting of customers. Of course, that is a longer process and will -- and this is why I'm saying the reshaping, or the remarketing takes longer, then also will uplift penetration again.

That was actually my question. When the migration day comes, you do not switch off your customers, which I think is absolutely the right thing. Because once you switch off the customer and he finds an alternative solution to get the TV signal, like satellite or Internet, you will never get him back. So you leave him on -- just to confirm, you leave him on for a certain amount of period post the migration date, even if he doesn't have an individual contract. And only once you've completely run out of patience, I guess, you would switch him off ultimately?

Exactly. Exactly.

Okay.

And have in mind, it's really in June, it's European Championship, July, August is Olympic Games. That would be also -- yes. That might help us as well. Somebody is saying, "I won't change a running system during the course of summer." And it helps us also with saying to, guess what, when you are not signing, we have to block you, that...

So you say to a member we're going to disconnect you here. We're just going to disconnect and escalate it, and then hope basically that -- okay. I understand. That's very clear now. I wasn't quite sure because I thought, once you disconnect, you can never get him back. But okay, you leave on, which is smart. And then last question and then I'll get off the line. Your CapEx split, I'd be curious if you can split up your CapEx a little bit into what's for new fiber line, what's for customer premise equipment, and what is for like general CapEx kind of overhead or also general maintenance of your old coax lines. If you could give me a little bit of clarity, maybe that's more question for Nicolai, that would be helpful.

Yes. Please provide your questions to the Investor Relations team to the link we will provide, and we'll come back to you on that detailed slide of CapEx and so on.

The next question comes from Tomas Moreno from Bain Capital.