Good morning and welcome to the América Móvil first quarter 2017 conference call and webcast. All participants will be in listen-only mode. [Operator Instructions]. Please note, this event is being recorded. I would now like to turn the conference over to Daniela Lecuona, Head of Investor Relations. Please go ahead.

Thank you. Good morning, everyone. Thank you for joining us in this call. We have on the line, Mr. Daniel Hajj, our CEO; Mr. Carlos García Moreno, CFO; Mr. Oscar Von Hauske, COO; and also, Mr. Carlos Robles, CFO of Telmex.

Okay. Thank you, Daniela. Welcome, everyone. Carlos is going to make a summary of the first quarter results. Carlos García Moreno Elizondo: Thank you, Daniel. Good morning, everyone. During the first quarter of 2017, economic activity remained sluggish in Brazil, but appeared to be strengthening across the region. This included Mexico that resumed its expansion after a rocky start for the year in the wake of the US election as increased uncertainty about NAFTA’s prospects impacted consumer sentiment and pummeled the peso. By the end of the quarter, retail sales were surging and the peso versus the dollar had risen to its best level since the US elections. It was the top performing currency in the period. First quarter revenues of MXN 264 billion were 18.5% higher than those of the year-earlier quarter, with EBITDA of MXN 72 billion, rising 15.8% year-on-year. The EBITDA margin, 27% – 27.1%, were nearly flat in the period, having declined 0.6 percentage points. The significant peso increases reflect the year-on-year depreciation of the peso versus other LatAm currencies and the dollar, with the peso declining 28% versus the real, 20% versus the Colombian peso and 8% versus the dollar with respect to the prior year. Consolidated service revenues continued their comeback, led by Mexico and Colombia. At constant exchange rates, they were up 3.1% year-on-year compared to 0.7% in the prior quarter and minus 0.2% during the third quarter. Most regions experienced sequential improvements in service revenue growth. As service revenue growth accelerated, EBITDA continued to improve, with a significant swing from an 8.1% year-on-year decrease in the fourth quarter to an increase of 1.5% in the first quarter – the first increase in eight quarters. Mexico, Brazil, Colombia and Peru were all important contributors to this sequential improvement, with the latter experiencing an…

Thank you, Carlos.

Thank you. We can take the first question.

[Operator Instructions] The first question comes from Amir Rozwadowski from Barclays. Please go ahead.

Thank you very much. Good morning, folks. A couple of questions, if I may. I was wondering if we could touch a bit on the competitive landscape in Mexico at the moment. It does seem as though, based on the commentary that you provided and some of the comments in the release, you are seeing a bit of an easing of the pricing pressure that was experienced over the course of last year. I was wondering if you could talk a bit more about the trajectory at which you expect pricing to unfold through the course of this year and what you’re seeing from a competitive landscape? And then secondly, we’ve seen some of the order – or the color from the regulatory agencies about the expectations for local loop unbundling. How do you think about the potential impact on some of the segmentation or a color that they have provided could have on the business on a going-forward basis? Thanks very much.

Thank you, Amir. Well, starting with the Mexico landscape, I think it’s still – Mexican market is still very competitive. I think it’s more stable. I have to say that it’s more stable, but very competitive. So, the prices and the promotions that we have in the market are still there. We are not giving extra promotions for reducing more of the prices, but it’s stable right now. You’re asking also how we see the year on that. It’s very difficult. We don’t know exactly what our competitors are going to do. But what we’re sure is that we still have a very, very competitive network with a very good quality, capacity and have a lot of distribution points there. So, I feel – and I still feel that we are very competitive in Mexico, that our network by far is the best. And it’s what is giving us what we have today. People is not looking only for prices, looking also for quality, capacity, speed, data. So, there’s still a lot of things that people is looking. So, I’m happy the way our network is developing. And I still think that the market for the rest of the year is going to be more stable. I don’t see much higher promotions. Those are in the plans on – when you see subsidies on handsets and other things, depends a lot on the exchange rate. You know that we buy all the handsets in dollars. So, it’s going to depend a lot – we used to have exchange rate of MXN 20 or MXN 21 at the beginning of the year. Today, it’s at MXN 19. So, it’s changing a lot, and that will change a lot the prices of the handsets. What I’m feeling and my view is that…

Thanks a lot. Thank you very much for the incremental color.

Thank you. Thank you very much.

The next question comes from Alejandro Gallostra from BBVA.

Hi, morning. Hi, Daniel, Carlos and Daniela. Thank you for taking my question. I’d like to better understand what’s the impact we should expect from the legal separation of Telmex. Should it be [indiscernible] Mexico or a one-off expense, and if you could quantify it?

It’s very difficult to see – to tell you right now as to what are going to be the – what is going to be the impact on Telmex because still we don’t know what is going to be the resolution. So, it’s going to be very important to understand. We are on talks with the IFT. We already present our proposal and they are – the stage where we are today is that they are reviewing that proposal and we are having talks with them on that. Very difficult to tell you the impact on Telmex because we don’t know exactly what are – what’s going to be the final resolution.

Okay, I understand. Thank you. And my second question is regarding pricing in Mexico. In an environment where pricing competition in wireless is easing, but especially where inflation is picking up and we are seeing some of your competitors increasing prices in some of the telecom services, of especially in PayTV, which you do not offer at the moment in Mexico, but also in broadband. Do you plan to increase prices in Mexico or reducing the expiration date in your prepaid products will be the only response to inflation at the moment?

Well, we have been having that. We have been reducing our due dates of the cards, but we don’t feel that, right now, it makes sense to increase prices. Of course, we would love to increase prices, but it doesn’t make any sense to increase prices. I understand that there are other products like the TV that it’s increasing prices. But, in broadband, we are not increasing prices. And in wireless, we are not increasing prices. It’s the other side, in 2016, we have reduced the price. If you review between the volumes that we grow on volumes and the price that we – the price reduction that we have, maybe we have 60% to 70% price reduction on the price in wireless. So, it’s huge what we have been doing. Today looks more stable. The prices looks more stable. I think – for the rest of the year, I don’t think there’s going to be more promotions because if you compare the prices in Mexico and you compare, let’s say, against the US, even that the US is starting to be more competitive, prices in Mexico are maybe half of the prices of the United States. So, we don’t see higher promotions. And just to tell you, Telmex hasn’t increased prices, maybe for the last ten years. So, in anything, we have been increasing prices for the last ten years.

Okay, understood. Thank you very much.

Thank you.

Next question comes from Walter Piecyk from BTIG. Go ahead.

Thanks. Hey, Daniel, the ARPU performance in a lot of the markets seem better than expected. Brazil is up 8%. The declines in Mexico and Colombia seem to have improved, I guess, in the first quarter. Is there any commonality for why this is happening? Are you doing something different across your markets? And on a related question, can you give us an update on what you’re thinking about capital investments in 2017 versus last year? Thanks.

What we’re focusing on – really, what is happening is that people have been using more wireless data, and that’s why our ARPU started increasing. So, the data is growing, people are starting to use more. As they are moving from a 3G to a 4G, they are using more data. And we have, in some markets, really crazy promotions that maybe they are due and we are not renewing some promotions. We are focusing a lot on the postpaid market. Postpaid has been very important. You could see that in Colombia. We’re starting to grow again, good growth on the postpaid side. Brazil, we’re growing very good on postpaid. Mexico, we are growing also on postpaid. And these subscribers are really consuming. So, smartphones are driving data everyday higher and higher. So, that’s mainly what is happening. It’s not different that what we have been doing. Other thing that it’s helping us is we feel that, in some countries, the economic side of the country is doing better and we feel that the rest of the year is going to be also good in the economic side. So, people is going to consume more. So, if you see, you can talk to Daniela, the trends of the data usage is growing very, very fast. So, it’s good news for us. We are well prepared in our networks. We have capacity. We have been doing all the modernization of the networks. So, megabytes are maybe growing 75% per user year-over-year. So, people is using more and more data in Mexico and in Latin America. On the CapEx side, we said around MXN 7 billion, what we have. It could be a little bit higher, 10% higher or less, and we’re still in that – with that number. And I think we are okay with that. We don’t think that we need to invest…

[indiscernible] data growth, that’s not driving higher capital investment?

No. No, we already have invested a lot. We have the latest technology and the CapEx that we have planned is what – we can handle all the traffic that we’re growing, that our subscribers are using. It’s big amount of data that they are using.

Okay. I just want to ask a question I’ve asked many times before, but just wanted to see if there’s anything that’s changed, which is, in Brazil, as we all know, there is – Oi is going through its process and AT&T, there might be an opportunity for them to sell that asset in Brazil. Has your interest improved given some of the comments that you made about – the positive comments that you made about Brazil in your prepared remarks?

Well, I don’t think there’s nothing right now in the market. It’s my view. I think everything is the same as it was one year ago. So, I don’t think nothing has been changed. And it’s my feeling. So, we’re focusing a lot in – I think, in Brazil, we have a very good platform. We are very good on cable. We have a wireless broadband, fixed. So, our platform in Brazil is very good and we feel have very good opportunity in Brazil for the next three or four years and Brazil is going to be in a very good position or much better position than what it was before. So, we are investing in our company and we’re happy in the position where we are in Brazil right now.

Great. Thank you very much.

[Operator Instructions]. Next question comes from Richard Dineen from UBS.

This is Maria Tereza on behalf of Richard. Our question is on the competitive landscape in Brazil mobile. Should we expect a change in strategy with the new CEO, perhaps a more aggressive focus towards market share gains, in line with the recently announced offers with unlimited voice?

I think we don’t change any strategy. I think the person that arrived to Claro is an excellent person. We’re very happy with Paulo. And there’s no – we always want to get more market share. We always want to be very competitive and nothing on that is going to change. So, there are no big changes. Yesterday, we launched a big campaign of all our products of focusing on wireless. So, we are executing the strategy that we have, and I think Paulo is going to help us to execute what the plan that we have. In Brazil, we have a very good infrastructure. We have been investing for a long time. And I think we are ahead of our competitors in the platform, in the infrastructure in Brazil.

Perfect. Thank you very much. And just as a follow-up question, you mentioned about the MVNO. And is there any way we can measure what’s going to be the impact from the cost-based wholesale capacity in terms of pricing for a medium or long-term view? Would you do a cost analysis in that margin? Will the price be regulated? How might that compare with your current retail prices?

You’re talking about Mexico?

Yes. Sorry.

Well, it’s very difficult to say anything on that because we are just discussing with the IFT some of this… Carlos García Moreno Elizondo: MVNOs.

With the MVNOs. We have right now, in Mexico, five MVNOs working. Of course, when you have a market so competitive for the MVNOs, it’s more difficult to succeed because the market, it’s so competitive that the margin for everyone are more reduced. But we are open, we want the MVNOs and we are giving, I think, for five or six MVNOs, we’re working today in Mexico. We are an MVNO in US, the TracFone. We know what those MVNOs needs and want, and we want to support our MVNOs here in Mexico.

Thank you very much.

Next question comes from Diego Aragao from Morgan Stanley. Please go ahead.

Hi. Thank you for taking my question. Just want to follow-up on the competitive landscape in Mexico. Apparently, you’ve continued to add more postpaid than peers. You’re still a net gainer in mobile number portability. So, my question is, how do you see your competitors at this point and what are you doing to accelerate volume-based migration, given these should help you to reduce interconnection costs? Thank you.

Well, I think people is using a lot more data, as I told you, maybe 75% year-over-year. And all the investments that we have been doing for the last ten years, well, are giving us that. Still, we are gainers in number portability, that’s right. We have a big distribution network. We have the best quality, the best coverage, the best capacity, very good speed. So, we are very competitive in Mexico. What does my competition is doing? Well, we have good competitors. We know Telefónica, we know AT&T, they are good competitors, and we need to improve every day, to compete against them and to be ahead of them. So, that’s what we’re doing today. So, competition is good and that’s what we’re doing here in Mexico.

Yeah, thank you. Is it fair to assume that you have like a big incentive to accelerate this data migration in order to reduce this interconnection cost?

Well, interconnection is in voice, okay? And I think people is going to start – is going to use voice always. They are using less voice because, of course, they are using more data. Well, they are going to use voice always. What is important and what’s we’re doing is that we’re moving all our 2G to 3G subscribers and a lot of the 3G to 4G subscribers. And that is giving them a very good speed, quality. People is very happy with our 4G network. And, of course, in the future, we’re going to prepare with LTE advance and we’re doing that to be competitive and to be prepared for what is coming.

Okay, perfect. And just a follow-up question. On Colombia, actually, can you provide more details on your results in that country? Apparently, it was very strong. So, just want to understand how you get to those results in Colombia?

Well, I think the results of this quarter is a work of the last three or four quarters that we have been doing. We changed the management, as I told you some time ago, and we are focusing much more on the market. We’re cutting costs, cutting expenses. We have a good plan and we’re executing that plan. In the fixed side, we are growing also very good. And TV, we’re very competitive. So, also, our company there in broadband, in PayTV, in fixed and in wireless, we’re doing very good. People is really focused on what they need to do, and it’s what we’re doing. So, that’s really – we don’t start from last quarter and we have the result this quarter. So, company has been improving and this has been a very good quarter because all the execution that we have in the last year.

Okay, very helpful. Thank you.

Next question comes from Mauricio Fernandes from Merrill Lynch. Please go ahead.

Thank you. Hi, Carlos. Hi, Daniel. One question still on Mexico and kind of the competitive landscape and the revenue trends. ARPU was still down despite prices being up. I know some of that has been addressed already. But ARPU tends to be tricky, given it depends on subscribers – they’re in and out – versus the pricing environment. Just wanted to understand whether you think the decline, not only in ARPU, but the revenue – service wireless revenue was coming up little by little in last couple of quarters and now it’s down a bit. How much of that is seasonal in the first quarter versus the fourth quarter or third or how much is that a matter of the mix of subscribers? You might have lost good subscribers and won less good subscribers.

I’m going to start with your last comment. So, we are not losing good subscribers and adding bad subscribers. It’s happening a little bit in postpaid is because of the aggressiveness of the plans and the rates and the promotions. People sometimes, not always, is renewing with us in a lower plan than what they already have. It’s because, with a lot of data that we are doing, and because of the competition that we’re doing a lot more data, then they don’t need to stay in the plan where they are and they do one step down and stay in the plan. So, that’s more or less what you could see in the postpaid side. Remember, Mauricio, that we have all these big promotions start in January and February last year. So, January, February, we start the promotions. But when the big amount of subscribers moved to these promotions in the prepaid side, they are maybe in April, May and June, we have a big amount. So, it’s where you’re going to see the decline of the ARPU in those months of last year. This is where our ARPU declined a lot. So, today, it’s recovering. We are seeing good recover. The trend is good. I cannot tell you that we are right now where we want to be. No. Still very competitive, the market. But I think it’s a little bit more rational, a little bit more stable, the market. And I think the prices are very, very competitive. In my view, it’s just my view, if you are going to see movement on the pricing, I think the movement on the pricing, on the promotions are going to be moving on the – moving up than moving more down, okay? Because the prices today in Mexico are…

That’s true.

Got it. Thank you, Carlos. Thank you, Daniel. If I can still follow-up on the topic of pricing, as Maria was asking, the new pricing plans for postpaid for Claro in Brazil, they include voice [indiscernible].

I’m sorry. I don’t hear you. They, what?

They include voice unlimited on the postpaid plans and the new postpaid plans. Is this something you plan to replicate to the rest of the region or is it something that is specific to Brazil, even though it looks like the trend for voice to be included in pricing plans?

Mauricio, I think the unlimited voice plans are in Mexico, in Colombia. We have also big amounts on Chile. So, there’s all around – in Peru, we’re giving a lot. In Austria, we give also unlimited. So, unlimited is coming. And it’s coming and it’s going to stay, the unlimited plans on voice. In Brazil, our new plans are unlimited in the high end of the plans. We had a very good launch yesterday and, of course, we have capacity in Brazil. Our MOUs in Brazil are low. Our interconnection in Brazil is going down. That permits to give unlimited voice and, well, that’s what we’re doing there. And I think you are going to see more and more on that all around Latin America.

Okay. Thank you very much, Daniel, Carlos.

Thank you. Thank you, Mauricio.

Next question comes from Carlos De Legarreta from GBM. Please go ahead.

Thank you. Good morning. My first question regards Brazil again. It’s a more specific question, sorry. I’m looking at the operating profitability and that’s growing by 91% year-over-year. I was wondering what’s happening here.

Well, what we’re capping is we have a – I think we’re having a very good reduction on costs. When we merge all the three companies, we work very hard and it’s still giving us good cost savings. And I think that’s part of what we’re having. The other thing is we’re being very careful not to sell. Let’s say, in DTH, we’re being very careful to sell very good subscribers. We don’t want to sell in prepaid. We want to sell subscribers that consume. And, well, that is giving us a better margin. And that’s really what is happening in Brazil. Also, a little bit of growth in the service revenue. So, all overall, it’s giving us a good increment in our operating profit.

Right, thank you. And if I may go back to Mexico, and I understand it’s too soon to talk about the impact of functional separation. However, I was reading the annual report that you guys filed recently and you guys mentioned a two-year period to implement this. Is that defined by the IFT? Is that already defined? I didn’t have that on the radar. So, if you could just confirm that, that will be great.

What we put in this file is that – and it’s what the IFETEL released is that we have up to two years to implement all these things. So, that does not mean that it’s going to take two years to implement. So, what I’m saying today is we already returned with our proposal. The IFETEL is right now studying that proposal, is going to discuss with us that proposal. I think they have 65 to 70 days. I don’t know exactly – two to three months to discuss that. And then, they are going to take a decision. And then – well – but in all these steps, you can have a little bit more days, if you ask for more days. So, we don’t exactly that, but what you’re saying is right. They said they have up to two years to implement all these measures.

Right, thank you.

Next question comes from Masha Kahn from Deutsche Bank. Please go ahead.

Hi. Good afternoon. Congratulations on a good set of numbers. I wanted to ask a couple of questions. One on the US market that’s getting a little bit more competitive. Is that affecting your MVNO business at all? We haven’t seen that in the results, but is that a risk, if you could comment on that? And second question is about fixed line investments. I noticed that you’re investing more aggressively in PayTV and cable across Latin America. Can you just talk a little bit about your investment plans on the fixed line and then what countries you’re going to invest more?

Here you’re talking about – the first question you’re talking about TracFone, and I can tell you that, yes, the market in US is every day more competitive. Everybody is – they already – the big companies are already launching their results and it looks like the market is more competitive. And in TracFone, we are taking care about the cost, the expenses. We want to be more competitive in the market. We want to play a big role in the prepaid market in the US. And that’s where we are preparing. The losses that we have, they are mostly in SafeLink. They are customers that don’t qualify with the new rules, and that’s why we’re disconnecting all these customers. But in the other brands, we are trying to be aggressive and we want to play a good role in the US. Your second question, I don’t understand what you said. Is it you’re talking about the...

Fixed line and cable investments. Yeah, you invested a lot in cable in Colombia. I noticed in some other markets, you’re putting more into cable and TV and also creating your own content. If you could just give a little bit more color on fixed line investments.

Masha, I think the intent is to deploy the capital, particularly in those countries, those regions where we can provide triple-play bundles because that’s basically where the return on the capital is there. I think Oscar can give us a bit more color on this. Another big part of the CapEx, we’re always building [indiscernible], the set-top boxes. To the extent that we are growing in distribution, in accesses, then you will also have an associated part of CapEx. But Oscar will be elaborating on this. Oscar Von Hauske Solís: Yes. I refer to what Daniel mentioned about the data growth, it’s happening in mobile as well in fixed. Broadband is growing 70% every year. So, that implies that we need to invest CapEx on the backbone in order to attain this growth in traffic. And the other part of the CapEx, you said more revenue-driven CapEx, there is different kind of set-top boxes for triple play, double play, satellite TV. But that will depend how we see the market, how we see the growth in the market. So, you have these two buckets. One is the growth in the platform for data products and the second one is the net gain that we have on units on the different products that we are addressing in the markets.

I guess I was curious how important quad-play was for you. You said you’re launching quad-play bundles, combining wireless and fixed line. Is that overall a strategy and a trend or is it just country specific? Oscar Von Hauske Solís: As you know, we started with the Combo Multi in Brazil. The reaction with the market was pretty good. So, we are delivering combo plays in most of the countries. So, we are trying to bundle triple-play, plus a wireless offering. And we believe that the market is well receptive to this kind of offering. And it’s, to be honest, a unique offering that we have in the different countries.

But only to add something to Oscar’s comment is that we are not only offering the quad-play as the offerings, we also do only broadband, only fixed, only TV. So, of course, we are trying to bundle a lot of our products, but we are selling a lot of broadband alone. So, we have all the promotions in all our products. Oscar Von Hauske Solís: Right.

Okay, thank you.

Thank you.

Next question comes from Barbara Halberstadt from Bank of America. Go ahead.

Hi. Hi, sorry. My line was muted.

Yes.

Hi. Hi. I just wanted just to follow up, I don’t know if that was commented during the presentation. Just regarding the working capital needs in this quarter, it seemed like it increased quite a lot, specifically on the suppliers line. So, just wanted to have a little bit more color of the reason for that, is something seasonal or just – or not? Carlos García Moreno Elizondo: Thank you, Barbara. Well, the first thing to note is that the numbers in the financial statements, when they are expressed in pesos, they are subject to a lot of noise that is associated with the currency moves, as I explained at the beginning, the early presentation. So, in particular, what you see is that in peso terms, certain operations, in particular Brazil, Colombia, have come to have much more weight in the financial statements, so that basically leads to a certain impression of higher working capital. So, it’s important to understand that a number of things in the balance sheet can become much affected by the currency moves, and so that’s one comment. And the other one is the working capital is very, very, very seasonal. And the first quarter of the year is always the one where we have more to put in terms of working capital, exactly because it comes after the last quarters where we have our greatest sales season. So, a lot of the, for instance, handsets that are sold in the last quarter are basically paid for in the first quarter of the year. And there’s also some things that have to do with CapEx. A lot of the CapEx accounts payable that you have – from the CapEx of the prior year end up being paid at the beginning of the year. So, typically, at least in our case, the first quarter is very, very seasonal, and that explains whatever increase. At constant exchange rates, you wouldn’t have had this growth in capital.

Okay, thank you. Carlos García Moreno Elizondo: Thank you.

Our next question comes from Rodrigo Villanueva from Merrill Lynch. Go ahead.

Thank you. Good morning, Daniel, Carlos. I was wondering if you could give us more color in the measures that have been implemented to achieve cost-cutting across your different regions and if you expect these measures to bring further efficiencies going forward? That will be my first question.

Rodrigo, I think, well, the measures are all around. It’s every part of the company. We’re doing measures in IT. We’re doing in operations, in administration. They’re all around. So, we’re looking – we’re making like a big comparison of each of the countries where we are the best and we’re trying to do in the places where we are the best, trying to do that in the other countries. And, well, it’s more an execution thing than a strategy, okay. Because, well, you need to find where are the savings and then you need to execute all those savings. So sometimes it’s not easy, sometimes some are taking you a little bit of time to implement that because that’s not something that you need only to take it out and that’s all or cancel. No, there are things that you need to do to change and to save some money. So, that’s something that we have from the last year. We’re putting much more effort this year. I think it’s important for us to be more and more productive, more efficient, and that’s where we are right now. Carlos García Moreno Elizondo: I think, as you remember, we have a concept that we call our core EBITDA, which is basically the EBITDA margin before subscriber acquisition costs. So, whereas sometimes some of the savings can come from subsidies, which is part of subscriber acquisitions cost, we always focus on this core EBITDA, which is basically the structural cost. And those are the ones that we are trying to improve very substantially. This area, I think we’re already working with a number of operations with very specific guidelines that we expect will attain some increases in EBITDA margins – in core EBITDA margins by the end of the year. So, it’s ongoing measures, as Daniel pointed out, but there are some new ones that we are basically implementing this year in some operations.

And maybe there are going to be new ones in three or four months. So, that’s something that we’re working every day. We have special people looking on that. And that’s what we’re going to do for the next two, three years.

Understood, very clear. Thank you. And my second question is regarding fixed broadband net additions in Mexico. It seems that they have accelerated very strongly over the last 12 months, while your peers have been facing trouble growing. So, I was wondering if there is any reason – particular reason for that to be happening now?

I think Carlos can answer that. Carlos Robles is going to answer that. But, in my view, the thing that we’re doing in Mexico is putting more and more focus on the commercial side, on the distribution. What I can tell you is execution is more or less what we have. What Carlos Robles, I don’t know if you could tell us something extra?

Also, what we’re doing is basically we are – basically, what we are doing is adapting our portfolio of products, so that customers have new products to be accessed – have access for them. And additionally, we’re focusing in different areas as it had happened with other countries. We have deployed already technology. We have good technology. And we have good quality of service and also we are focusing on specific commercial strategies all around the nation.

Thank you, Carlos.

Okay, thank you so much.

Thank you.

Next question comes from Juan Pablo Alba from Credit Suisse. Go ahead.

Hello. Thank you very much for taking my question. So, my question is regarding your comment, as you mentioned that you have already presented a plan to IFT for functional separation in Mexico. My understanding is that this is a little bit ahead of the deadline they established for you. And I’m just wondering, if you have any sort of interest in speeding the implementation, if you feel like you can reach a target a lot sooner?

No. No, we don’t do it because of that. We just prepare our plan. And when it’s finished, we send to them. And that’s really the reason why we do it before our last day. And, well, the next step, as I said, is to – they are going to review this plan and we’re going to sit down with them and discuss it. That’s mainly the next step is – in the next 60 to 70 days or something like that.

Okay. And my follow-up is, if you see any sort of upside regarding cost-cutting initiatives that you could achieve through the functional separation, if you see any sort of advantage on that?

It’s difficult. I cannot tell you anything until – we don’t know exactly what is going to be the end resolution of this separation. But, as we said, we are not agree on that. And we think that IFT do not review really the changes in the market for the last two years. There have been big changes in the market for the last three years and we don’t agree with that.

Okay. Thank you very much.

Thank you.

This concludes our question and answering sessions. I would like to turn the conference back over to Daniel Hajj for any closing remarks.

No. Just thank everyone for being in the call. And thank you. Bye-bye.