This is the conference operator. Welcome to the Rogers Communications, Inc. Third Quarter 2024 Results Conference Call. As a reminder, all participants are in a listen-only mode and the conference is being recorded. Following the presentation, we'll conduct a question-and-answer session. [Operator Instructions]. I would now like to turn the conference over to Paul Carpino, Vice President of Investor Relations with Rogers Communications. Please go ahead, Mr. Carpino.

Thank you, Galen, and good morning, everyone, and thank you for joining us today. I'm here with our President and Chief Executive Officer, Tony Staffieri; and our Chief Financial Officer, Glenn Brandt. During our Q&A, I'd ask you limit yourself to one question and a quick follow-up if needed. Today's discussion will include estimates and other forward-looking information from which our actual results could differ. Please review the cautionary language in today's earnings report, MD&A and in our 2023 Annual Report regarding the various factors, assumptions and risks that could cause our actual results to differ. With that, let me turn it over to Tony to begin.

Thank you, Paul, and good morning, everyone. I'm very pleased to report that Rogers delivered another strong quarter of results. For 11 consecutive quarters, we have delivered industry-leading results driven by disciplined execution in a healthy and competitive market. We once again reported industry-leading market share in wireless, industry-leading margins in wireless and cable and strong profitability in media, and we continue to invest in the future growth of our three core businesses. And we made significant progress in strengthening our balance sheet. As you saw this morning, we announced a transaction with a leading global financial investor to provide an innovative $7 billion structured equity financing. The proceeds will be used to pay down debt, and as a result, we now expect our debt leverage ratio to reach 3.7x by year-end. This is well ahead of our 4.2x target we previously communicated, and it will accelerate our Shaw deleveraging plans by a full 12 months. This structured financing transaction is the first of its kind in Canada and demonstrates our innovative approach to maintaining an investment-grade balance sheet while investing in growth. Closing is subject to the finalization of definitive agreements and is expected to happen in the fourth quarter. Let me now turn to our third quarter results. This quarter, we added a record 227,000 mobile phone and Internet net additions. And over the past 11 quarters, we have added 1.9 million mobile phone and Internet net additions. It's clear our strategy is working, and our team is executing with discipline. More Canadians continue to choose Rogers more than any other provider in Canada. I'm proud of our team and the efforts -- their efforts to compete in a healthy and competitive marketplace. Wireless postpaid mobile phone net additions were 101,000 and prepaid net adds were 93,000. The…

Thank you, Tony, and good morning, everyone. Thank you for joining us. As Tony has said, this is now our 11th straight quarter for posting sector-leading operating and financial performance, and we are proud of those results. We remain focused on delivering consistent, disciplined execution with strong performance and growth. We are following through on what we have said we would do with urgency and without distraction, including on our accelerated delevering plans. This morning, we announced an innovative $7 billion structured equity financing with a leading global financial investor to acquire a minority stake in a portion of our wireless backhaul transport infrastructure. This is a transformative transaction and the first of its kind in Canada and it will further strengthen our investment-grade balance sheet. This transaction is subject to completion of definitive agreements, which we expect we will complete and close on in the fourth quarter. The $7 billion in proceeds will be used to pay down a corresponding amount of debt. As a result, we now expect to end the year with leverage in the range of 3.7x. More on this shortly but let me now turn to an overview of our strong third quarter results. Wireless service revenue grew 2% year-over-year, reflecting the continued growth in our mobile subscriber base and continued emphasis to add subscribers on our Rogers premium 5G brand. Postpaid mobile phone customer net additions were a strong -- a very strong 101,000 and prepaid net additions were 93,000 in the quarter. As expected, the back-to-school period was competitive this year, particularly in the seasonally strong prepaid market, which tends to be more active for back-to-school. Rogers remained disciplined in the market and delivered an effective balance across strong subscriber loading and disciplined fundamentals reflected in stable ARPU. As a result, our aggregate…

Certainly. We'll now begin the question-and-answer session. [Operator Instructions]. Our first question is from Batya Levi with UBS. Please go ahead.

Great. Thank you. I'd like to start with the structured equity financing. If you could provide a little bit more detail in terms of if there will be any shares issued with this, how it would impact maybe your operational -- your operations as you leaseback some of that network elements for your own support? Any color on that that would be great. And then second question was more on the wireless side. If we could talk about a bit more on the competitive environment as we go ahead into the holiday season. And if you think that the stable ARPU can be sustained. Thank you.

Thank you, Batya. On the first question, to be clear, we are not leasing assets. This is not a sale-and-leaseback transaction. We are selling a minority equity interest in a portion -- regional portion of our wireless backhaul transport infrastructure. And that's the extent of the transaction. It is an equity transaction with that, that minority interest in the subsidiary company. We will maintain full operating control of our entire network, including these assets that are involved in selling the minority equity stake. There are no RCI shares involved, RCI A or B, no dilution to our RCI shareholders. This is a minority interest being acquired in a portion of our wireless backhaul and there is no lease.

Batya, on the second part of your question relating to wireless competitive intensity getting into the fourth quarter, it's always difficult to predict competitive market dynamics amongst the various brands that are in the market. But if we look to the third quarter in the back-to-school season, we were very focused on being disciplined with our promotions. We led with a bundled offer of Internet and wireless and stuff to that and get executed well and resonated throughout the back-to-school period. You saw that we continue to focus on our primary brand strategy, Rogers, 5G premium. When you look at the 101,000 postpaid nets, the vast, vast majority of those are on the Rogers brand. So the team is doing an excellent job of focusing on that segment and migrating customers from Fido and Chatr to the premium brand. And you saw us execute really well with the Chatr brand in the new to Canada and back-to-school category. There, what we saw was as a result of a number of system changes we made, we've got a platform now in Chatr that is very good in terms of self-serve and has dramatically lowered our cost to serve in the prepaid segment. And so we've consolidated all our prepaid into Chatr and we discontinued prepaid on Rogers and Fido. And that's working extremely well in the fourth quarter also. We like what we see in terms of the prepaid customers. They're predominantly on auto pay. And so the behavior is very similar to a postpaid customer, and they're coming in at very healthy ARPUs. And so the strategy is working well, and we'll continue that into the fourth quarter, although, you should expect prepaid to come down in the fourth quarter. There's seasonality related to it in the third quarter, and we expect to focus in the fourth to be on to postpaid.

The next question from -- sorry. The next caller is Vince Valentini with TD Cowen. Please go ahead.

Thanks very much. I will sneak in two as well. One, just if you can flesh out that prepaid a bit more healthy ARPU remains like close to $30, close to what you were getting a low-end flanker before, Tony. And I also note churn on prepaid way lower this year than it was last year. And this quarter even better at 2.8%. So in your mind, is there really any difference between a low-end flanker and a prepaid customer anymore? So that's question one. The other -- sorry, Glenn, but something just sounds too good to be true here. Who's going to give you $7 million for no equity and no lease payments? Is there -- what is the buyer getting here? Are they getting some sort of like option to resell these assets back to you in the future? Or what's the angle here? There has to be something for somebody to want to pay for the minority interest in the infrastructure?

We can turn to that. Do you want me to turn to that, first, Tony? Okay. The -- so the arrangement is obviously the wireless backhaul, transports data, the towers to our core. And so the transport going from the edge of our towers to the edge of our core is a business of transporting data. And currently, that business is 100% owned and controlled nationally from coast to coast by Rogers. This is a transaction that takes a portion, a regional portion of that, that national transport and creates a subsidiary that using wholesale rates we'll pay for the transport. And so it creates revenues, there are expenses and capital for maintaining that regional portion of the backhaul. And that ultimately will drive net income within the subsidiary. It's a consolidated subsidiary won't affect EBITDA, but the minority interest holders will earn a portion of the net income within that subsidiary. And there will be distributions paid from that net income and from the cash that settles between our operating company and at Rogers and the subsidiary, carrying the backhaul in these regions or in this region. And that's the business model. So there's no lease. There will be periodic distributions of available cash. They'll settle up and that's the business model.

That makes more sense. So Rogers pays an operating expense as opposed to a lease to you --?

It's a supply agreement. Yes. And a portion of it, a controlling portion of that will attribute to RCI and a minority portion of that will attribute to the minority investor.

Sorry, Glenn, just a follow-up on that. Is this data transport backhaul significantly underutilized today, so that there's excess capacity to grow those revenues? Is that the catch?

Okay. So just to be very clear and to make sure there's no confusion, this is not a business that will sell backhaul to other carriers. This is a business that will continue to serve Rogers exclusively and we'll continue to consolidate up into Rogers. There is data revenue or data traffic growth going on today. Annually, our data traffic grows by 40% to 50% as a result of increased data loading to each subscriber and as a result of subscriber growth from quarter-to-quarter. We will maintain the network, as we always have, we'll continue to maintain it, invest in it, we control that investment, we control that operation of the infrastructure. This is simply setting up a supply agreement between a subsidiary and the operating company. The returns to the investor, the minority investor coming in are based on that traffic. And we have the forecast worked out based on historic and expected growth rates to set up that business and the volumes that it will drive, the revenue that will drive, the expenses that are expected for operating it. And the distributions out to the minority investor and back up to RCI as the controlling shareholder, those distributions are forecast to be anticipated to be relatively stable within a known range based on our forecast.

I guess, you don't want to tell us that known range at this point.

I'm not looking to disclose the financial terms. No, Vince. Thank you.

Thank you, Glenn. That was much better.

Thank you.

Vince, on the first part of your question, we have been driving, and we are seeing a blurring of the lines between prepaid and postpaid. And it's been a very deliberate strategy for us, and it's been very competitive, beneficially competitive for us in that segment of the market where Chatr is participating. Customers are coming in, as I said earlier, largely on auto pay. And so the behavior is very much like postpaid and we're seeing very little difference. And the ARPU is very strong. Our prepaid ARPU is not that different than Québec or ARPU, just to put it in perspective. We're not going to quote specific ARPU numbers by brand, but that will give you a sense of the value proposition and the strength of the pricing on the Chatr brand.

Okay. Thanks, Tony.

Next question, Galen?

The next question is from Maher Yaghi with Scotiabank. Please go ahead.

Great. Thank you for taking my question. So just a follow-up on this interesting transaction that you guys announced today. I'm trying to figure out what kind of effective rate the minority interest is getting on this deal, trying to triangulate a little bit more the impact of this transaction on your future free cash flows. And what percent of your backhaul is included in this deal? You say that it's a regional part of your network. But if you can just ballpark a little bit how much of your current backhauling this represents? And are there a minimum commitment that you need to provide your equity minority shareholder on this deal in the future that is set in advance or it's just pay per use. And I'll have a follow-up on after that.

So it's based on tiered wholesale rates, volume tiered as the data traffic grows, the tiering adjusts. There is no specific term on the investment there is no guaranteed minimum for the distributions. There is a theoretical maximum that we would reach or approach as you get into higher and higher tiers keep in mind, we've got a business that's growing data rates at 40% to 50%. And so if this were to run indefinitely, that 40% to 50% annual growth would get quite high. And so the rates are adjusted accordingly in the tiering. The cost and the maintenance will all be factored in, in the distributions. The order of magnitude, Maher, I'm not going to quantify the annual distributions. What I would say on a business of approaching $10 billion of annual EBITDA. If you were to factor in the interest savings on $7 billion of debt repayment at our annual cost of just over 4.5%, that's roughly $300 million a year. The distributions of the net income that a portion to the minority investor will be a little bit higher than those net after-tax interest savings, but not materially higher. I expect well inside $1 billion of distributions coming out from the minority interest investment. And so let me give you that range, and that is a very wide range deliberately so, so that I'm not steering to exact returns on the call. It's not fair to the investor, and we're still working on completing the final documents. But this is an excellent opportunity for the company to delever. It's a structured equity transaction. We maintain control, we delever and the impact on our free cash flow and ability to continue to invest in our business carries on unrestricted by this transaction.

Great. It sounds like it's basically a bond on the backhauling. It's like selling a bond on your backhauling business.

It's -- we're selling a -- I'm going to resist the -- that description and that this is an equity transaction. And so it will be considered as such. And so we're selling though a distribution stream.

Yes. Okay. And do you have any option to repurchase that, that, that ownership over time?

We will have full control over how long this investment remains in place, and we'll determine that in the fullness of time with the needs of our balance sheet. Yes.

One last one. Are the distributions to the equity partners of that entity tax deductible?

No. They would be equity distributions, and so they would be treated as such. And so that's the -- we will be repaying debt that has tax deductible interest. We will be paying distributions that are not tax deductible. But even with the effect of that, if I factor in the difference between what I expect will be the annual distribution amounts and the annual interest savings. In the context of our free cash flow, it's not a significant increment to our obligations.

Great.

Thanks. Thank you, Maher. Galen, we have the next question, please.

Thank you, Maher.

Certainly. The next question is from Drew McReynolds with RBC. Please go ahead.

Yes. Thanks very much. Good morning. Sorry, I had trouble kind of climbing on. I'm sure the financing is being hash to death here, but one follow-up there for you, Glenn. Just in terms of valuing that minority stake, obviously, you're not going to get into the details there specifically, but just what was the approach that to how that came about. And then, just switching gears here, on the wireless network revenue growth, you're tracking at 2%, you're going to be ahead of your large-cap peers. As you look into kind of Q4 and 2025, we're seeing some incremental ARPU pressure. And obviously, today is an announcement on could be even more modest market expansion next year, just with some immigration tweaks. I'm just wondering how you are looking at network revenue growth in Q4. And are we at the trough? Can we climb back up to maybe not historical mid-single-digit, but where do you aspire to get to as you look through the medium-term? Thank you.

Sure. Thank you, Drew. On the question on valuation and how the valuations arrived at and Drew, the investors would look at this as a stream of cash flows that they would work in their modeling and run as a valuation. We've done the same here. It's a fairly straightforward business. We've got growing data loading across infrastructure that we own and control. We've done so for decades. And so from our standpoint, we're pretty confident in our ability to determine over the near, mid-term, long-term horizon what it takes to operate a wireless network in the backhaul transport related to that. This is a transaction that when you own and control the entire national network, you can look at it not have to worry about the arrangements with partners, not have to worry about the intricacies of that. We control it. We control the operating costs. And so we're able to forecast with a pretty good degree of confidence where the data loading traffic is going to go. We have a tiered rate structure that reflects that traffic today and the loading going out into the future. That generates the revenues with a good degree of confidence. We know the operating cost, the capital cost of maintaining that transport with a good degree of confidence. And then those forecasts I'm sure the investors look at and run their own analysis and assessment based on their experience. And then it's just a financial valuation of what their hurdle rate returns are, how they value it, how they risk adjust it. And we have determined the value of their minority stake as being CAD7 billion. And so it's a significant valuation. But let's keep in mind; we carry a very significant volume of traffic on that network. And so that's the simplicity of it. And then in terms of your question around ARPU and revenue growth going into the fourth quarter, I might -- I would anticipate that the fourth quarter will be competitive, just as the third quarter was. We will continue to emphasize disciplined approach to going after our net adds, emphasizing our premium brand, and you've seen us for, well, many quarters now, leading on net adds, while being disciplined around the impact on ARPU and sustaining revenue growth. I expect what you've seen in the third quarter in a competitive quarter will carry into the fourth.

Drew, if I could add to that, just to bring it back to the macro revenue outlook. I think besides ARPU, I think it's important to look at the size of the market. The Canadian landscape continues to have healthy growth -- we expect the industry once everyone's reported, continues to grow somewhere between 4% to 4.5%. We certainly saw lower volumes and size of market in the third quarter. As a result of government limitations on foreign students, temporary workers and most recently, have some impact in the fourth quarter is limit our curbing of immigration. But notwithstanding that, we're seeing -- we continue to see good growth in terms of penetration gains as well as population growth. And so against that backdrop of healthy growth in the marketplace, the team has been doing an excellent job of base management, upselling customers from Chatr and Fido into the Rogers premium brand and focusing on a value proposition that is beyond just price, and that seems to be resonating as well. We've said we're committed to ARPU growth, and the strategy we have seems to be resonating. And right now, we reported in Q3 stable ARPUs, but we continue to see the opportunity through the various execution tactics we have to grow ARPU into next year.

Thank you, both.

Great. Thank you, Drew. Our next question, Galen?

The next question is from Sebastiano Petti with J.P. Morgan. Please go ahead.

Hi, thank you for taking the question. Just wanted to maybe touch on the MLSE announcement earlier last month. Just to see if you can provide additional color about the structure and how we should be thinking about that, particularly the language about -- I think, in the press release today that Rogers will be the largest owner of MLSE with a controlling interest in the 75%. So when can we perhaps expect to see additional details of what that structure might look like, given commentary previously that will not be a leveraging transaction. And so that's my first question.

Thanks, Sebastiano. The -- we stand by the statement that we will manage this that we will continue to emphasize our delevering. We'll continue to manage our balance sheet with the closing of that MLSE investment. And particularly, the -- this structured equity transaction gives us some optionality and some leeway on how we structure that to continue to hold the gains from this transaction and look to how we fund MLSE between now and when we close, which I expect will be out in 2025. There's a number of different ways we could do that. I expect on closing, we will own and control a majority stake in MLSE, could be as high as 75%. If we bring in outside partners over time, whether it's at closing or subsequent or whatever, we'll determine all that in the fullness of time. This structured equity transaction that provides us with a substantial delevering. We will close 2024 in the range of 3.7x. I anticipate with the MLSE transaction, we will close 2025 in a similar range. And maybe I'll just leave the comments at that, Sebastiano.

Similar range to the 3.7x that you anticipate exiting 2024 with, Glenn, is that what you're…

Yes. Yes. Sorry, yes, yes.

Okay. And then I mean, just zooming back as we think about the delevering overall, I mean, I think the strategy of the stated plan was to delever by half a turn before asset sales entering the year. We now have, on an organic basis, the things that will probably not be coming in -- even with -- there's no asset sale that we come through. So we're not necessarily delevering half a turn on an organic basis. We look at the pressures across the ecosystem, I mean and implied guidance. And I understand the improvements on an operational basis that Rogers is currently executing against. But as we think about the path for delevering over the next several years, I mean, the question we're getting from investors, I mean, what is the strategic equity transaction announced today? I mean, what does that imply about the cash generation of the business? I mean, is the company still looking -- does management still look at Rogers' ability to delever over the next several years? And has that materially changed as we think about the backdrop of the ecosystem? Thank you.

Well, we remain extremely confident in our ability to generate cash from operations. So to the extent it's changed, I'm more confident we announced we would hit $1 billion of cost synergies in 24 months, and we hit it within 12 months. We will realize $1 billion of cost synergy savings realized in year in 2024. And so I'm confident in our ability to drive earnings growth, cost synergies, cost efficiencies, improved margins. That helps lift our EBITDA helps lift our free cash flow. We will generate $3 billion of free cash flow in 2024 and we hold a very substantial portion of that free cash flow after dividends to pay down debt. So to the extent it's changed. I'm more confident at the end of 2024 than it was going into 2024 and our ability to hold cash from operations and pay down debt. We are doing that. So I remain confident and very satisfied. We announced when we went into this transaction with Shaw that within 36 months, we would delever back down to in the range of where we were pre-Shaw. Well, pre-Shaw, we were a little bit over 3 times. With this transaction, we are approaching the mid-3x range, and we're not yet at the second anniversary of the Shaw transaction. I appreciate we haven't sold the targeted $1 billion of non-core assets, and that's suggest to your question. I acknowledge that, but we're not desperate, wasn't ever going to be a fire sale in the interest rate environment, we've had to take a pause on that. I think what we've shown is strong flexibility around adjusting our strategy. We were going to sell non-core assets and then get to our Cogeco shares. Last year, we realized the non-core assets would be delayed. And so we flipped and we sold our Cogeco stake delevered at the end of 2023 from that substantially. This year, we found an opportunity. I appreciate you said we haven't sold assets. We've sold $7 billion in an equity interest in assets that if you were to look to our balance sheet and find the net book value for those assets, $7 billion far outstrips the net book value of those assets, and this is a portion of our wireless backhaul. This is not even the majority of our wireless backhaul infrastructure on our balance sheet, and we sold it for $7 billion of equity interest. We control the operations. You're right to acknowledge these assets aren't non-core, they're core. And that's why we will maintain control. But I think we're showing a very dedicated driven intent to delever and continue to invest and grow. Maybe I'll pause there.

Sebastiano, yes, thanks, Sebastiano. Well, next question, Galen?

The next question is from David Barden with Bank of America. Please go ahead.

Hey guys, thanks so much for taking the question. I'm going to have to ask one more on the securitization thing. And then I'll ask one about the business. But -- so Glenn, I think that the word that we want to use -- I would use is securitization, right, that you've taken -- you've created the subsidiary this intercompany payment system. There's a forward stream of these payments, you're front-end loading the receipt of these payments into your balance sheet and $7 billion. And my question a little bit is the original plan was we would delever and our cash outflows would go down. But here, with this setup, where the payments out to the minority holder are greater than the interest savings from paying down $7 billion of debt, you're delevering, but your payments are going up. And so I guess, the question is, what's the point of that? Like why is it so important to have a lower numerator divided by denominator if your cash outflows are actually going up instead of down. And then, Tony, I guess, the big -- one of the big conversations we've been having has been how the impact of the government's new integration policies or posture are going to impact industry growth and how that does impact industry growth, how the industry will react. And you guys have been probably the biggest beneficiary of new Canadian market net additions. I'd love to kind of get your perspective on that. Thank you, guys.

Let me answer the first question first. Your reference to securitization, I'll just highlight a securitization transaction would be debt and this isn't debt. The -- your second part of your question around how does this make sense because you're saving on interest, but you're paying out more on distributions. I've been careful not to enumerate what we are paying out in distributions. And so I would just suggest to you that this is an excellent opportunity for the company because on the balance, we are very pleased with where we anticipate that balance to go over the future, and I'll just leave it at that.

Second part of your question, David, relating to really relating to the size of the market. I think a couple of things I would say. The government curing of the new to Canada category. You look at the foreign students, our estimate; it's corroborated by some other reports that have been prepared externally. That, that category is down in the third quarter, 40% year-on-year. Temporary workers, foreign temporary workers is down 20% to 25%. And so in the new to Canada category that has impacted it. And as you say, we've traditionally done extremely well in that category. But what you see in our results for the third quarter is that we execute across all segments of the market and perform extremely well. Our estimate is that we once again have leading market share in the third quarter in both postpaid and total mobile phones. And so that's really attributed to, again, our focus on the Rogers premium brand. As I said, the vast, vast majority of our net adds is on Rogers premium brand, and now increasingly good share on Chatr. In terms of the size of the market outside of the new to Canada category, we've traditionally seen over the last year and a bit, if we look at that trend line, excluding new to Canada, we're seeing organic growth in the 2.5% to 3% as a result of penetration growth, which is now at 88% and going up to 90% very soon and still lagging other countries on that key metric. So good opportunity for growth in terms of size of market.

Great.

Thanks, David. Next question, Galen?

The next question is from Jerome Dubreuil with Desjardins. Please go ahead.

Hi, good morning. Thanks for taking my question. The first one is on the equity sale in the backhaul there. Just trying to bridge the gap with the leverage guidance that you have provided. If you can maybe clarify the tax impact on the sale of those shares? What's the net value of the $7 billion? That is question number one. And question number two is on the CapEx kind of longer-term for Rogers. I appreciate there's no real change from the deal you announced this morning, but I'm wondering if 2024 is a year with high CapEx, normal CapEx or low CapEx, I appreciate you, we've been seeing mid and high split deployment, microwave backhaul replacement. Just looking if this year is a high CapEx year in general? Thank you.

Thank you for the questions, Jerome. The tax impact, I mean, just put that in the context of $7 billion of debt repayment, our average cost of debt is just over 4.5%. So the pre-tax or the available tax expense on interest expense would be around $300 million. Think of the net after-tax or additional tax cost to that takes your net savings down to about $0.25 billion roughly. And that will give you the order of magnitude on the net savings from the repayment of debt. And I'm sorry, your second question on the CapEx?

CapEx?

Yes. I think I've been consistent in signaling that if you're modeling, and I'm not going to start guiding for 2025 yet, but I think I've been consistent in my comments that if you were to model of continuing our range of spend of around $4 billion, if you're going out assume some inflationary impact but keep it in the range of $4 billion. We will manage our priorities within that band. As we grow revenues, the intensity will mediate or soften, but we're not looking to step down we're investing from roughly that $4 billion range. We have a number of priorities to get to. Our businesses are all growing. And that is a sufficient envelope for us to drive the business growth in that order of magnitude.

Thanks for clarifying.

Sorry, Jerome, just so we can get a couple of your line out there.

Yes, that's fine.

Thanks. You can follow-up later. Galen, time for two more quick questions, please.

So the next caller is Simon Flannery with Morgan Stanley. Please go ahead.

Great. Thank you very much. Good morning. Tony, the CRTC recently put out a strategic plan. I just love a general commentary on the regulatory environment and how you see that evolving over time. And in particular, they had a recent comment on the roaming rates. They want some replies to you in the next few days. Perhaps you could just comment on that and then also just give us a little bit more color about how big roaming is for you in the wireless business currently? Thanks.

Thanks, Simon. In terms of -- I'll first start with the roaming side of it. What we have seen is a decline year-on-year on total roaming revenue. We don't disclose the amount of it. But if you were to look at the negative impacts on ARPU, that, that would be the single biggest one for us in the third quarter. And so we've evolved in our -- have and you'll see in the fourth quarter, evolve our value proposition on roaming, so that we accelerate and increase the number of unique roamers. We've seen the actual number decline. And so we're adjusting the value proposition as we compete with alternatives that customers have when they're outside of Canada. Early indications are good on that. And so we like what we see. In terms of the CRTCs commentary in looking at it, it's not a surprise. They had indicated that earlier in the spring as they were looking at various fees in the industry. And we'll obviously participate and cooperate and providing all the information that they need. But as I said, we've already evolved in terms of our value proposition on roaming.

Thank you. Thanks, Simon. And our last question, Galen, please?

The next question is from Aravinda Galappatthige with Canaccord Genuity. Please go ahead.

Good morning. Thanks for fitting me in. Two quick ones. I want to follow-up, obviously. First of all, Glenn, you mentioned sort of in the vicinity of 3.7 times leverage even that exiting 2025. Just wanted to clarify, does that envision the non-core real estate sales? Or does that exclude that? And the second question is, obviously, on guidance, when you can look at the 12% to 15% guide that does require an uptick in Q4. Perhaps maybe talk to what could drive that? I know there'll be some pricing action that you've taken? Anything that would kind of change the trajectory that we've seen in Q2 and Q3? Thank you.

Thank you, Aravinda. The -- on the revenue, we're going into an active quarter. It's a strong quarter for us across our businesses. We remain determined to meet those guidance ranges as I've indicated. And so I'll leave the answer at that. You've hit on some of the elements of that in terms of some pricing initiatives. The vast portion of our growth is driven on the growth in our subscribers. We've had strong contributions from that through the first three quarters of the year, and that obviously helps drive the fourth quarter as well. And so it's a balance across all of those elements. In terms of your question on the non-core real estate assets, that remains a work in progress. I've grown weary of explaining each quarter that we're on it and it will come. Interest rates are high. And so we've pivoted. Keep in mind a full success on selling all of those targeted non-core assets would be somewhere in the range of $1 billion and that would be in the range of 0.1 impact on our leverage. If there is any opportunity to fill those in, we will fill them in at the first opportunity. I'm not desperate to do it, and I'm not chasing a market that's disinterested. And so we will adjust accordingly. But the 3.7x range does not specifically say if we sell this or that, if we do this or that, we've got about a year and a bit to go before I close out 2025. We've got many options on how we grow the business, how we generate free cash flow, how we apply that free cash flow generation to paying down debt and how we meet the investment in our increased stake in MLSE. To be clear, that is factored into the 3.7x, and I've got a number of different avenues to fund that acquisition. That will help in our delevering.

That's great.

Thanks, Aravinda. And thanks, everyone, for joining us on the call today. If there's any follow-ups, please reach out to the IR team. Thank you very much.

This concludes today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.