Telefónica, S.A. (TEF) Q2 2023 Earnings Call Transcript

For the period ending June 30, 2023

July 27, 2023 4:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good morning. Thank you for standing by, and welcome to Telefónica's January-June 2023 Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] As a reminder, today's conference is being recorded.

I would now like to turn the call over to Mr. Adrian Zunzunegui, Global Director of Investor Relations. Please go ahead, sir.

Adrian Zunzunegui

Good morning, and welcome to Telefónica's conference call to discuss January-June 2023 results. I'm Adrian Zunzunegui from Investor Relations.

Before proceeding, let me mention that the financial information contained in this document has been prepared under International Financial Reporting Standards as adopted by the European Union. This financial information is unaudited.

This conference call and webcast, including the Q&A session, may contain forward-looking statements and information relating to the Telefónica Group. These statements may include financial or operating forecasts and estimates or statements regarding plans, objectives and expectations regarding different matters.

All forward-looking statements involve risks and uncertainties that could cause the final developments and results to materially differ from those expressed or implied by such statements. We encourage you to review our publicly available disclosure documents filed with the relevant securities market regulators. If you don't have a copy of the relevant press release, please contact Telefónica's Investor Relations team in Madrid or London.

Now let me turn the call over to our Chairman and CEO, Mr. Jose Maria Alvarez-Pallete.

Jose Maria Alvarez-Pallete

Good morning, and welcome to Telefonica's second quarter results conference call. With me today are Angel Vila, Laura Abasolo, Eduardo Navarro and Lutz Schuler. As usual, we will first take you through the slides, and we'll then be happy to take your questions.

During the second quarter, we continued to focus on our strategic objectives and delivered on our goals. We improved our position in all core markets. In Spain, retail revenue growth improved, and we progress towards OIBDA stabilization. In Brazil, FDA minus CapEx performance was outstanding with more than 30% annual growth, while revenue grew above inflation, thanks to a strong operational performance.

In Germany, the first half results showed a strong performance and continued momentum with excellent progress in 5G deployment to 90% pop coverage in a normalized CapEx-to-sales envelope.