[Operator Instructions] Good morning, ladies and gentlemen. Welcome to the Swisscom Half Year Results 2020 presented by Urs Schaeppi, Mario Rossi and Louis Schmid. Louis, the floor is yours.

Good morning, ladies and gentlemen and welcome to Swisscom Q2 Results Presentation. My name is and Louis Schmid, Head of Investor Relations and with me are our CEO, Urs Schaeppi; and Mario Rossi, our Chief Financial Officer. The first part of today's Analyst and Investment Presentation hosted by our CEO consists of two chapters: a quick overview of the highlights, operations performance and financial results of Q2 and the first six months; second, an update on our activities and performance in Switzerland and some explanations on assets, network initiatives and first half year results. In the second part of the presentation Mario runs you through chapter three, the financials and full year guidance. With that, I would like to handle over to Urs for his thought. Urs?

Yeah. Good morning, ladies and gentlemen, I would like to start with Slide 4, a short update on the main highlights. So we are proud that we were able to win all the mobile network tests in the first half year. We had also a very resilient operation during the COVID-19 pandemic. So our networks were resilient and were able to digest the additional loads. On the Swiss business, we are satisfying with the overall development. We have some impacts from lower growing revenues. And on the other side, we have an increased Net Promoter Score Customer Satisfaction Index. And also the Solution business has slightly positive development. So overall, satisfying business in Switzerland and good results in Italy, where we were able to have quarter of addition growth in all of the segments and also important strategic projects which I will show you later. On the sustainability level, we were able to close a green bond, so this was the first green bond in Switzerland for related company. And on cost savings, we were able to deliver our forecasts. And in this case, we are also committed our outlook on EBITDA level and CapEx level and slightly lower on the net revenue level because of COVID impacts. But we are committing our EBITDA outlook. If you go on Slide 5, you see our performance. So on broadband and TV, slightly negative net adds, the main reason behind it is the lockdown in Switzerland, where our shops had a much lower performance. On the other side, you will see that the business is resilient. If you look also to our churn figures, we are in a in a very comfortable situation. On postpaid, slightly increased postpaid net adds. And also in wholesale and in Italy, you see on mobile and on broadband, good growth. So, Italian market is not as saturated as the Swiss market. And the COVID had a good dynamic for Fastweb in the broadband internet segment. If I look to the months now, I think we will have a better performance of net adds in the next month. If you go on Slide 6, you see our key financials. So, net revenue of CHF 5.4 billion, slightly lower than previous year. Main impact is COVID-19 and some price erosion in Switzerland, increasing revenues in Italy. The underlying EBITDA development into Q2, you see that it's approximately stable minus CHF 17 million EBITDA. Increasing EBITDA in Italy, slightly lower EBITDA with CHF 17 million in Switzerland. And also on the bottom line of this chart, you see the development of operating free cash flow, which is on the level of our expectation. If you go on Slide 8, so there you see - some, let's say some impact on COVID-19. I don't want to go through now all - through the details. But overall, the main topic is business in Switzerland was - was solid, good customer satisfaction, with impact from lower revenues - from lower roaming revenues and Fastweb is on track. And also on debt level payments rates, we don't see a disruption up to now. On Page 9, some thoughts about the impact of COVID on our industry. So what's clear and what's not new is that COVID will push digitalization and for a company like Swisscom, this brings also some opportunities on, let's say on the cost side, on the efficiency side in our operation, but also on the customer experience side in the different segments. So we will continue to exploit these opportunities through digitalization. It's an important - it will be certainly important - an important project. If you go on Slide 10, you will see that we are performing on our network side. You see all the tests on the wire line, wireless side, all the tests we won in the first half year and also the improvement of our KPIs. On the right side of the chart, you see our plans for ramping up the fiber-to-the-home footprints in Switzerland. Today we have 30% footprint fiber-to-the-home, in '25, we will have a footprint of 50% to 60% and we will have a coverage of 90% with speeds above 200 megabits per second or good performing broadband networks. On Slide 11, you see our B2C performance. So we are well positioned, we are able to defend our market position in a market which is very promotion driven. So, we had a lot of activity on the promotion side in the first half year. The market is, I would say, without promotion nothing is happening. So, the promotion activities continued even through the lockout period. And on the left side of the chart, what I already mentioned, you see that the frequency in our shops and this is also the main reason why we had some lower net adds in Q2. But overall, we are well positioned. We have the right things in place to also perform in the next quarter. If you go on Slide 12, there you see some KPIs in the B2C markets. And then on the upper left side, you see that our penetration in our core offering inOne. InOne, that's our core offering in inOne mobile or inOne broadband, you see that we were able to increase the penetration. On bottom left you see our churn figures, low churn figures. In the middle, you see the development of the ARPU. So a stable blended ARPU in the wireline business, a slightly decreasing ARPU in postpaid. While in postpaid, ARPU is CHF 52 minus CHF 4 compared to previous year and of this CHF 4 approximately CHF 1 is coming from roaming, CHF 1is from converge - a converge rebate, and then CHF 2 through revenue mix trends to lower tariffs plans or 2nd and 3rd brands, which have a slightly increasing market share in our portfolio. Penetration of fixed mobile convergence products is also increasing the CVR in the region of 40% to 45% fixed mobile penetration, which is important also because churn figures are in the region of two percent points lower than in single product. On Slide 13, some information about our B2B business. So, you see that the revenue generating unit in the wireless business is slightly going up or slightly grows. On the other side you see an ARPU of CHF 33, and you see also the price pressure which we have in this market segment. You see also that we are able to reduce our costs. So costs went down by 2.6%, which is a good performance. So overall, the EBITDA margin in this B2B segment is at 43.6%, so slightly higher than in Q1. Solution revenues in the last first quarter, we're able to have slightly a growth on our solution revenue, which is a good performance in the actual market condition and also in the period where we had a lockdown. On Page 14, the financial performance of Swisscom Switzerland. Here, I would like to mention that service revenue erosion which we have through prices and also some impacts from roaming because of COVID. So, we have that decline of service revenue of CHF 157 million. The EBITDA is approximately stable about CHF 1.8 billion EBITDA in the first half year which is CHF 22 million below previous year period. And the operating free cash flow, which you see on the bottom of the right side, there we have - if you make the comparison to last year, there you should take into account that last year we had spectrum auction of CHF 196 million. But overall, as expected good robust operating free cash flow. On Page 15, some information about Fastweb. So the strategy of Fastweb is to become an infrastructure based OTT. There are a lot of different initiatives. And you see on the right side of the chart, what we executed in the first half year. So we bought Cutaway, that's a small IT company in the Cloud and the IT business, which will - strengthening our position in the B2B market. And on the infrastructure side, we were in talks with this FiberCop in Italy. The agreement is still pending, you certainly saw what was the last announcement on it. On Page 16, some more information about this FiberCop. So this network company in Italy. So, the main idea is that Fastweb is bringing in this new company, the joint venture partner of FlashFiber with Telecom Italia and for this we get a stake of 4.5% of this FiberCop. For us this will improve our positioning in the fiber-to-the-home market. And so we will be able to have a better market performance. On Page 17, you see our initiatives on the Fixed Wireless Access with 5G. So the idea is to get an ultra-broadband footprint also in digital divided areas. So we want to deliver with fiber fixed wireless access 50% of our footprint in the divided areas. And on - with this, we will be able to increase also our market share and our margin structure in this areas - in this digital divided area. On Page 18, some information about IT company Cutaway. I don't want to go deeper in it, but it's certainly a good move to strengthen our positioning in the B2Bmarket. Page 19, some KPIs about the performance. So you see that we were able to have the goals on broadband, on mobile, on a subscription level. And also during the COVID phase, Fastweb had a good momentum on broadband. The market is still underpenetrated in Italy and with the lockdown and home office, a lot of customers saw that the broadband internet could be a good thing. And then therefore, we have a good momentum in the broadband market. And on the right side of the chart, you see our increasing fixed mobile converge penetration. Today we are at 33%. And you see also that we had a good Net Promoter Score and on mobile but also on wireline, so high Net Promoter Score is an important target for Fastweb and we are performing on this KPI. The B2B performance on Page 20 of Fastweb, you see also in Enterprise segments, we have revenue growth of 5%, a good momentum and no impact up to now in the cash-in of the B2B business. And then also, you see also that we are able to grow. We had a revenue growth of 19% in this segment. On Page 21, the key financial figures of Fastweb, they are in line with our guidance. On the revenue side, a growth for 5% on EBITDA side, also a growth of 5% and an operating free cash flow proxy, which is CHF 36 million above previous year, or at CHF 63 million, so overall, a good and strong performance in Italy and a resilient business in Switzerland. With these words, I would like to hand over to Mario.

Thank you Urs, and also good morning from my side. I will start on Slide 23, with some remarks on revenue. First on the Swiss business, the Swiss business was impacted by the roaming revenue decline because of COVID-19. Outbound impact is - on outbound roaming, CHF 27 million in the first half. This is shown in the service revenue and less incoming roaming revenue of CHF 14 million. This is shown in the segment wholesale and others. On the other side, we had less out payments of CHF 27 million. So the net effect of this roaming decline is CHF 14 million on the margin ladder. On the service revenue development in residential, we saw a slight acceleration of the service revenue decline in Q2 due to change of the RGU mix, you'll see some details on Slide 25. In the B2B segment, we have an ongoing price pressure. Service revenue in Q2 went down by CHF 35 million, and that is CHF 5 million less than in Q1. On the other side, we see growth on the IT business also in Q2. We had CHF 10 million growth in Q1, CHF 4 million growth in Q2. And as seen before, at Fastweb, we have a very solid revenue performance in all three segments. On the next Slide, a few explanations on the cost, on the OpEx. So overall, we're well on track to reach our cost target. On SAC/SRC, in Q2, they are CHF 5 million below prior year, mainly due to the closed shops during the lockdown. And to remind you, in Q1, we had CHF 40 million lower SAC because in 2019, in January February we still have the old mobile offering in the market, where we were still subsidizing the handset, so that was the reason for the big saving of CHF 40 million in Q1. The outpayments, I mentioned CHF 27 million less because of the lower roaming business. On the indirect cost, we saved CHF 64 million in the first half. The workforce savings in Q2 were only CHF 5 million because of increase of promotion for holidays because nobody took holidays during the lockdown except we think we're seeing the same saving as in Q1. So we are well on track there. Then we have some lower costs in Q2 in the area of operating direct costs because of COVID, less travel, less marketing, communication, part of those costs we will see in Q3, mainly communication and marketing. But overall, we can confirm our cost saving targets of at least CHF 100 million for the full year 2020. On Slide 25, you see the different elements of the EBITDA, development of the phase business. As expected, you see on the left-hand side in the B2Csegment, the impact of fixed voice line losses and convergent discount is coming down. The impacts of fixed line losses is negligible and also the penetration of the customers is going but the increase of penetration is coming down. So the impact is less. As I mentioned before, we have an acceleration of the impact of the change of the RGU mix, CHF 29 million in Q2 versus CHF 18 million in Q1. CHF 4 million of that is coming from less revenue of pay per view for events in Q2 because of lockdown. But overall we have this price because of promotions A and B, we have more new customers on the 2nd and 3rd brands, meanwhile, we have 17% of our postpaid customer base on 2nd and 3rd brands. As I mentioned before, B2B, we have less impact of price pressure in Q2. And then you see also the details in the roaming CHF 10 million in Q2 in the B2C segments and CHF 12 million in the B2B segment. On Slide 26, so the underlying performance of the Group is almost flat, despite COVID, despite the revenue pressure in Switzerland. Thanks (a) to disciplined execution of the cost saving program in Switzerland and (b) to a growing EBITDA of Fastweb. The overall EBITDA margin stands at 40.6%, it's an increase of over 0.7%. I think the dynamics we already discussed in the other segment, a slight decline in the business in the Swisscom Broadcast and of Swisscom Directories, in the White and Yellow Pages. Net income on Slide 27 is at CHF 738 million, 5.6% below prior year. The main reasons are the lower EBITDA, of course. Then we had higher other financial expenses. This includes CHF 30 million non-cash adjustment of the present value of provision for regulatory cases. Then on the tax side, we have a CHF 20 million positive impact, we see that there is some reduction in some kind of [canton] but long term, you can calculate this tax rate of 19.5%. We have no remarks on the CapEx, we confirm our CapEx guidance. And then as was mentioned before, we are well on track with our Fiber roll out. On cash flow, so first of all, cash in Switzerland and Italy is in line with prior year, and our expectations. So, despite COVID, we have a very resilient cash generation in those markets. One remark on the income taxes paid, so we have less income taxes paid of CHF 137 million. The reason is that the government allowed to defer, tax payments because of COVID-19. And of course, we took benefits of this possibility. The rest, I would say, is without any surprises. On page 30 and 31, on the financing side, we have a very successful placement of a €500 million green bonds in Q2, several times oversubscribed, attractive conditions and all 2020 maturities are full refinanced in [need] of this year. And that brings me already to the guidance. So we confirmed the guidance of CHF 4.3 billion EBITDA and CHF 2.3 billion CapEx, below the revenue guidance by CHF 100 million to CHF 11 billion and the main reason is the expected full year impact of the roaming business of CHF 70 million to CHF 80 million. And with that, I hand over to the operator.

[Operator Instructions] Thank you. The first question comes from Michael Bishop.

Thank you and good morning. I guess on first half, it'd be really good to get your updated thoughts on the potential impact from Sunrise UPC combination? I know we went over a lot of the details on various calls when the transaction was proposed before but things like your latest wholesale exposure and how you think the competitive dynamics in the market might change would be really useful. And then secondly, on the cost cutting, I was just wondering if you could give us a little bit more color on how you think the cost cutting is tracking for the year? It felt like in your presentation, Mario, you were talking about the fact that cost cutting had actually been hindered by no one taking holiday. So is that a tailwind for 2H? And you've already done CHF 64 million. That feels like that's tracking well ahead of the CHF 100 million, so any comments there? And then perhaps if I could just a very quick third question, on your comments around COVID being very positive for Fastweb and Telecom Italia were quite cautious on Italian B2B. So I'd love to just get a sense of what's driving that attraction for Fastweb and given the macro-pressure in Italy? Thanks.

Oh, I will take the question on the merge, possible merge and Mario then on cost. And I will say some words to follow it. Maybe first on the - on this merge, UPC Sunrise, I think the dynamic will stay as we already discussed when Sunrise would have takeover UPC. So the main competitive dynamic will be the same, I think we have a competition today, we will also have competition tomorrow. Swisscom is in a - is well positioned on the network side but also on the whole product portfolio side and distribution. So to your question, what will be the impact on our wholesale basis? Maybe a bit early to say because we don't know how this merger will come but certainly, we will not have an impact in 2020. We will have - if this merger will come, a very low impact on '21, then maybe high - maybe a bit increasing. But overall at the end, the full impact I think will be on the wholesale business in the region of, of let's say CHF 50 million or CHF 60 million overall but the total risk. So it's a limited exposure at the end which we have, let's say, CHF 60 million. And then on our positive dynamic of Fastweb because of COVID, so Fastweb is very well positioned in the B2B market. Fastweb is an agile quality provider. In the B2B market segment, we are increasing our market share since a lot of years, and that was also the reason because you are agile quality provider that we were able to infrastructure projects for B2B company. And then, I'm optimistic that we will also have a good momentum in the B2B market in Italy in the next quarters. Mario, on cost and cost and cost-cutting?

And on the cost side, yeah, you're right, you will see some tailwind on the workforce costs. On the other side, we will have practically no marketing and communication costs in Q2, that we'll see in Q3 and Q4. But overall, we expect we'll see savings north of CHF 100 million, as we can confirm today.

Thank you very much.

The next question comes from Arbuzov Roman from JP Morgan.

Thank you so much for taking my questions. Maybe just starting with a follow up on the previous question, I got cut out when you were talking about cost during the presentation. Have you quantified what was the impact from people taking less holiday, if you could give us a sense of those numbers that would be helpful? And then a question on Italy as well. So there is a lot of discussions about single network coming into being and the potential merger with Open Fiber. And again, I guess, FiberCop in which you're now involved. So if we go down the route, do you have a strong preference for TI having control or not having control? And do you think it is possible to have equal treatment of all operators by a single network in a scenario where TI has control or these things are just incompatible? And one more, just wanted to follow up on this whole Sunrise Fiber partnership? Do you do you think at this stage it makes sense for you to take part, given now you've had a bit of time to think about it, are you planning to participate in this venture in any shape or form? Thank you very much.

So, I will take the question about on this cost and holiday topic. And first on this Swiss Open Fiber. So our strategy is to execute our rollout plans as we announce them and then that means we count to grow, we continue to build our fiber-to-the-home networks. And I think it's too early to judge, what is Swiss Open Fiber company will do. And as in the past, on a tactical level, we were open to do some partnering but as you have done it in the past with utilities, but we don't see that we go now in a close cooperation with the Swiss Open Fiber. We will build our networks and continue to build it.

And on the cost side, I mentioned when I explained the Slide 24 that, without this holiday issue the saving would be more or less the same as in Q1. That means the impact is around CHF 10 million for Q2, because in Q1, we had savings of CHF 14 million and in Q2 of CHF 5 million.

And then on this question of the single network FiberCop in Italy, the role of Telecom Italia, the whole control in this, for us it's important that we have - that we can have a fair competition in Italy. For us, this deal is a value accreditive, value accreditive transaction. We have access to the financials, also the dividend streams of this FiberCop and the commercial conditions reflecting profits participation in this co-operation. So overall, we will be able to, ramp up for, let's say, for good investment, our footprint fiber-to-the-street, fiber-to-the-home, in this combination with this FiberCop and differentiate ourselves in the market. But important for us is, at the end that we have here an organization where competition can be executed on a fair level.

Okay, thank you very much.

Great. The next question comes from London. Could you please state your name?

Hi guys, it's Simon from Barclays. Sorry, one more on Sunrise and wholesale. Could you just give a bit more color about, say how the wholesale contracts are structured? The volume discounts, how easy it is for them to get out of the contracts and if they do migrate a lot of customers, how the discount, say reduce? Any - any color around how that work would be would be very useful? And then you said that the impact in B2B was a little bit smaller on price competition this quarter. Do you think that was just COVID-related and companies focused elsewhere who are looking at switching their mobile or their telco operator? Or are you seeing maybe actually a change in the B2B market and competition is just an improvement? Thank you.

Simon on the wholesale business, I think you get the best details which is on public on the Sunrise presentation of last year, September 30. There they're talking about the run rate of savings of cost of goods sold of CHF 60 million, that's exactly the number was explained or confirmed before which will be - which will be build up over the next four years. CHF 60 million there you have savings from MVNO. Of course you don't disclose the details of the MVNO contract with UPC. And then you have the saving of six network access costs and there the story is unchanged. UPC has not 100% cable coverage, it's around 70%, so a part of it, they will always need to buy from us, from Swisscom. Then let's say the migration of the customers, at the end, will most probably not be 100% and it will not be at an overnight. So I would say today, situation is unchanged as at the end of September last year, where Sunrise disclosed the potential synergies of this transaction and they are rated at CHF 60 million. And also on the discounts of the - of the access deal is with Sunrise, they are not - they're not public.

Then on the cost margin and overall on the B2B, the allotment of B2B, no, that has nothing to do with COVID. You know, the contracts and impacts of the new contract --- this contract were closed a few months before that - slightly better improvement, better negative allotment on the price pressure. I wouldn't say that - that's the long-term trend.

Okay, very glad. Thanks very much.

Great. The next question comes from George from London.

Yes, good morning, and thank you for taking my questions. I have two. The first question is around the developments in Italy. Urs, I just wanted to a bit more color as to the agreement you signed with Wind Tre last year. My understanding is that certain areas where your will act as wholesale provider and obviously, they have some arrangements with Open Fiber. I'm just curious how these would work in areas where there are overlap, whether you take your agreement has priority over the Open Fiber's agreement with Wind Tre has priority? And then my second question is more broadly on B2B and thank you for the update on both Swiss trends and Italian trends. I think when COVID started, Mario, you are suggesting that you are worried that ICT projects may be delayed and everything else but over time, maybe virtualization and cloud will take over. Do you mind just giving us an update of whether you think this could change the B2B business over time and whether the net effect could be positive or negative? Thank you

Good on Italy, that the agreement which we have with Wind Tre, there are different elements in it. That partnership, the co-financing partnership for 5G that's one part, another part is a wholesale agreement where they get access to our broadband portfolio, and the third part of this agreement is also a base station connections, such things. This wholesale business is quite - quite wide. And you're right there we are in competition also on - on broadband with Open Fiber. But we are confident that we will have, as a good wholesale business also with Wind Tre on this broadband access, retail broadband access. And then on B2B, Mario on this wholesale - on this solution business development?

Yeah, yeah. So I remember we mentioned at your conference that in IT some - some lower IT business in the second half, so far, we didn't see that. So, the business is developing as expected. And yes, we think mid-term, the prices and the whole digitalization is certainly, let's say, a chance for IT business, thinking about cloud, thinking also about security. You know, it's more and more people working from home and you see some new aspects in terms of security. So I think mid-term, that's good opportunity for our B2B business and I think we are well positioned with our large IT organization to create revenue.

And if I could ask a quick follow up on the B2B side, around bad debts, it was something I think you mentioned at the start of the year, you'll have better clarity by the second - first quarter results. Is it still too early to assess if there will be an impact or should we interpret this as meaning probably the impact will be quite negligible?

What you see today is that the impact is quite negligible.

Also in Switzerland and in Italy today we don't see an impact. So the whole question is what will be the development in mainly in the SME market in the next month and that's hard to touch - are there lots of bankruptcy? But at the end if I look to the Swiss economy, I don't think that the exposure is too big and in Italy up to now we don't see signs so, it's too early to give a forecast on a on a year level, but we don't see now alarming signs.

Okay, thank you.

The next question comes from Ulrich from Jefferies.

Thanks so much. It's Ulrich Rathe from Jefferies. I have one question and two clarifications, please. The first one is on the commercial environment, but specifically in the consumer market, it seems that that has been pretty rough and has stayed pretty rough in the second quarter. Could you confirm that or discuss that a bit and provide a bit of color, how you see the competitive environment there? And then specifically, with regards to B2C, I mean, if you had to choose whether a merged Sunrise UPC as a tougher competitor, because it has fixed mobile capabilities or whether they would be a more rational competitor that is, is ultimately interested in preserving market value? Which of these two sides would be your base case expectations, tougher or a more rational? And then two clarification on the wholesale exposure, Urs, and you talked about the CHF 60 million, do I understand correctly, that that would exclude the UPC MVNO? That the number you mentioned there excludes the UPC? Mario's comments sounded like that was the case, I just wanted to confirm. My second clarification is when you book wage costs, do you book them essentially as paid? So everybody - so somebody who is fixed employed, just you have the same cost per month because you pay them six - per month, or do you actually - do you actually book the cost when people work and you don't expense wage costs when people are on holiday? Is that - Is that what you're saying here? Thank you.

Well, on wage cost, Mario will take over.

I'll take that later.

Okay. And then on Sunrise - Sunrise UPC, this is possible merge. So, you know, at the end the main question is, how rational this new play will behave and I don't know it. But if I look to the to the industry dynamics, and to the - to this new company with [back book] and internet - [back book] and TV. And then also in mobile, I think it should be rational play at the end because the market shares are much more distributed but I don't know it. But I think it will be it will be - maybe more rational than in the current market situation. But I don't know but we will see. On the competition in Switzerland, you're right in the first two quarters in Switzerland, we had very aggressive promotions. And then driven by Sunrise and then driven also by Salt, and some of them also by UPC. So very aggressive promotions that the let's say the red line of it is half price and some hardware in it. And then if there is no promotion, there is no liquidity in the market. But at the end, market shares are not turning so much. If you look to the Swisscom, so it's a kind of washing machine and the question is how long this will last. The acquisition cost of this promotions are quite tight. But my forecast is that we will also have aggressive promotion in the third quarter and fourth quarter.

And on the wholesale side, so the CHF 60 million those include the MVNO savings. And I mentioned before, that will not happen overnight that will be built up over say three years. And on the accounting question, yes, wages are booked when people work. That means if they take holidays, you have less personnel expenses. That was the reason nobody took holidays in Q2 compared to 2019.

But we are confident that they will take a holiday until the end of the year.

Understood, thank you. Can I just follow up real quick then? The CHF 60 million sounds quite low compared to how Sunrise discusses the synergies if it includes the MVNO savings? So would you be really -

Now, I shall refer to the presentation of Sunrise before the merger or the potential merger last year. It's around right the synergy estimate CHF 60 million per year and six network access cost savings and the MVNO savings. And the reason is there's not 100% coverage of the cable operator and that not all customers most probably will be migrated in the footprint. So yes, both effects and we don't disclose all the numbers but we confirm this CHF 60 million estimates and we did already last year. We did that already last year.

Okay. Well, thank you.

The next question comes from Steve Malcolm from Redburn.

Yeah, good morning, guys. I hope you can hear me okay. I just had a couple of sort of, I guess, Q2 COVID-specific questions. One is on your inbound roaming. I'm kind of surprised that it was only down CHF 14 million, CHF 20 million - sorry 28% in the quarter. I guess in other markets, we're seeing it, pretty much zeroing. Can you explain where the inbound roaming revenues that you've booked actually came from, are those kind of take or pay contracts? And secondly, just sort of trying to tease out your cost performance, I get the message on personnel. But if I looked at your fact sheets, your other operating expenses declined by 17% in the quarter, which was a kind of massive drop versus what you reported in Q1. They're nearly CHF 100 million, can you give maybe sort explain what goes into that bucket and of other OpEx which go so much? And one, maybe one final one, just on Fastweb wholesale I mean, that was clearly the big outperformer in the quarter, the Fastweb, very difficult to model. Can you give us an idea of what you think is sustainable growth in that Fastweb wholesale revenue line is over the next two or three years? Thank you.

On the inbound roaming, we had this impact of - in Q2 of CHF 30 million that's roughly around one third below prior year. And you know you have some - some traffic, you know, we are in the middle of Europe and you still have some traffic and then you have also some valuation impacts because it's always - they're always bilateral agreement. But I cannot give you the, let's say, by heart, the distribution of the traffic by country.

Are you back to sort of normal levels now? Where do you - where are you tracking on that inbound roaming in Q3 and are you thinking about that for the second half of the year?

No, we expect the similar impact in Q3 as in Q2. You have, in Q3 it's usually - you have a lot of stories also salts from Asia and the U.S. usually in Q3 and you that will that will be practically zero, so we will have a similar reduction in Q3 as in Q2.

Okay, but a third of reduction is it kind of normal level given the traffic flows with Germany and France and Italy, is what you're saying?

I'll do that. You know that traveling will be on a low level also in Q3. I don't update that now for Q3.

[Indiscernible], the impact is so relatively little because it's a lot smaller than the market but I understand your geographic location may help. Okay, thanks and then other OpEx apart from wholesale?

In other OpEx, we have CHF 45 million savings in the first half, that is for marketing advertising. I mentioned before that that nearly stopped in Q2 that's CHF 12 million out of the CHF 45 million, then we have less maintenance repair, CHF 6 million. And then we benefited from a lower travel costs IT costs, say around CHF 15 million. And then in terms of - these are the main elements. And then, you know, we have CHF 7 million higher savings in Q2 than in Q1. And then that's mainly because of marketing and travel, which - and you know that we saved about CHF 2 million per month, so we saved about CHF 2 million per month, because nobody was traveling.

Okay, so I mean, how much would you say sort of COVID-specific? You called out the COVID revenue impacts, but it's a little harder to see the sort of COVID-specific cost benefits that you got in Q2. Is it possible to put a number on there?

Yeah, that in the end is not so big. You can say CHF 5 million?

In other OpEx, CHF 5 million to CHF 10 million and maybe another CHF 5 million to CHF 10 million coming from marketing communications.

Okay, so I mean -

And in marketing communication we certainly see a part in the second half.

Okay so the CHF 10 million would be positive?

On Fastweb, the wholesale development on Fastweb, so, the main growth drivers for the wholesale of Fastweb is, our company's customers like in Italy, Wind Tre but also Sky. So, there are a lot of different retail players so that will bring a growth for faster consultation and then also part of wholesale business the whole base station connection. And these mobile networks are, are increasing, so there is also more base station connection. So these are the drivers behind wholesale business in Italy.

But you think you can keep growing that business double digits over the next two, three years. Is that fair?

Yeah, I don't say don't make a forecast on the percentages of growth, but it's - wholesale will be a growth business. Yes.

Okay, thanks a lot.

Great, thanks. The next question is from Jakob Bluestone from Credit Suisse.

Hi, good morning. Thanks for taking the question. I have a question on the sort of evolution of your service revenue drivers that you outlined on page 25. And could you maybe just get back to the point about the sort of worsening drag from B2C RGU mix? Just to sort of understand how much of that do you think was, you mentioned earlier in your presentation, that you were seeing more spin down to the 2nd and 3rd brands? And how much of that do you see as a temporary effect? And how much of that do you see as a sort of increasingly accelerating drag? I mean, it looks like over the last few - last few quarters, there's been quite a step up in the size of this RGU mix drag? Thank you.

I'd say of this CHF 28 million, about 50% are coming from the impact of 2nd and 3rd brands that's CHF 2 million higher than Q1. Then what I mentioned is CHF 4 million is coming from value added services because we had no sports event to sell. And about CHF 4 million to CHF 5 million are coming from the wireline business. Some price from the wireline business and also from that area from lower number of customers because we lost some customers in the last quarter.

Okay, so it does sound like there is even ex-COVID and sports also was temporary. It does sound like there is a sort of deterioration happening there?

Ex-COVID, I'd say this is about CHF 4 million, I'd say.

Yeah, okay.

Then a slight acceleration that is coming from second, mainly coming from 2nd and 3rd brands and less subscribers on B2B.

Great, thank you.

Next question comes from Usman Ghazi from Berenberg Bank.

Hello, thank you. I just have two and a half questions, please. The first question was just on the 2nd and 3rd brand topic, I see that you've expanded the distribution of Wingo now to offline channels with Mobilezone. Could you perhaps, run through what the logic is there and if there is a risk that this, in a general move of spin down in the market goes up even more as a result of that move? The second question was just on the various network disruptions that were widely reported during Q1 and then through a bit of Q2, has - has that at all impacted your relationships with your B2B customers or resulted in a need to make some special offers to retain these customers as a result of these disruptions? And just generally, I mean, it's quite uncharacteristic of Swisscom to report such kind of disruption. So, could you perhaps indicate whether the issues here have been solved or not? And then my third question was just on the damages claim between Sunrise and Swisscom. I see that you have a provision in the balance sheet around CHF 210 million. The Annual Report also indicates that you expect some kind of resolution within zero to five years. Is it - could you perhaps give any update on how you see this - this claim situation developing? Thanks

Mario will take the claim question. I will take the two or one and a half other questions. And then to the first question, the 2nd and 3rd brands, you're right. We also distribute it through Mobilezone. Wingo, the product Wingo already with this option, the 3rd brand we were in all the physical channels. And if you look to the whole competitive environment in Switzerland, I think online is an important channel for 2nd and 3rd but also some physical channels are important. That's why we went in Mobilezone - the Mobilezone channel. And it's working well. And on the network, network stability side. So we had - we had some problems in the first quarter, a lot of different reasons behind it. No structural patterns. And if you look to our Net Promoter Score, we didn't get a hit on the Net Promoter Score. The Net Promoter Score in Q2 is even higher than before. And it also reflects our strong performance during COVID. And so I think we didn't actually get a hit on the customer side through this stability problem. In B2B also, we had just some losses on it. But the stability has priority, one for us and the stability of the Swisscom network is very good. If you - if you take some KPIs, you see that in the last two years, we were able to decrease our minutes of failing by - by 40% in the retail market, just as an example. And therefore, I think we didn't get actually a hit to this - to this incident in the first thought.

And on provision, the regulatory cases, you will understand that you cannot disclose more than is to be disclosed in the half your report and there you will see the explanations, our expectations in Note 8, and I'm sure you will understand that we cannot disclose any more details.

Thank you. But perhaps, can I just follow up on the network question. I see that Swisscom will be shutting down the 2G network I guess earlier than your peers to free up capacity for 5G. Has that project anything to do with the disruptions that you're seeing at the moment, or is it completely unrelated? Thank you.

No, it's nothing to do with it. We announced it five years ago that we will phase out the 2G network at the end of this year. The main reason is the reduction of the complexity which also leads to lower costs but that's one part. The second point is we get actually space on the site for new technology, for 4G and 5G and spectrum. And then do you know, today, that the usage of 2G is extremely limited, so the majority of all the traffic of the voice calls are on the 4G.

Thank you very much.

Okay, we have two more questions. Next one is from Müller Andreas from ZKB. Andreas Müller: Yes, thank you very much. Good morning. I have two questions. One is on FiberCop, what kind of cash impacts you foresee, going forward in terms of CapEx for examples for Fastweb? But also in terms of increasing maybe the stake at some point or in general, the cash impact? And then on the Swiss market, TV shops and broadband shop, you mentioned that the shop closing had some impact there. Do you see that for the whole market or are there also market share shifts going on in Q2 and also going forward? Thanks.

On the question of the net add market share shift during the lockdown period. And I think Swisscom has a customer base which is, well online is still relatively low. So that's why during a lockdown of physical channels, we have a bit of lower performance. If I look now to July and August, I think we are in a better situation, so we have a better performance. I don't really see big changes in market share on the Swisscom side, on the whole market and also very good indicator normally is the net - net porting, where you see the in porting and out porting and there, I don't see really big exchanges on market share. But I think you don't have to look only on net adds but you have to look on service revenue market shares. But in what is what is the main dynamic there is that because of price pressures in service revenue is coming down as Mario explained before - in Switzerland.

And on FiberCop, it's - so first of all, it's - this new, it's a contribution in kind of our 20% stake in FlashFiber and that brings approximately 4% to 5% of new cost. Then in the future, as of today, we don't have any intention to increase that stake. So there's no negative cash impact on that. And on the CapEx, so in that area, maybe we'll improve our network from FTTS to FTTH, there will be some CapEx but they will come over the years. And that has room in our existing CapEx envelop and there will be a reshifting, so no negative no negative CapEx, no positive cash-in. Andreas Müller: That's clear and thank you.

And then at the end, more performance network, meaning if FTTH, it will be some, the more competitive and will result in longer term rights. Andreas Müller: Okay, thank you very much.

Great. The last question comes from Frederic Boulan from BoA.

Hi, good morning guys. A quick question on mobile. So first of all on 5G, if you can give us an update on the 5G debate in Switzerland with the opposition and the EMF concerns and maybe an update on your 5G build out? And then secondly on your mobile ARPU, before the CHF 4 impact your slides for convergence and mix, what's your - what can we expect in terms of development going forward? And in particular, on 5G, I mean, you seem to have removed the premium for 5G. So where do you see that ARPU outlook going forward?

Now on the network rollout of 5G in Switzerland, we have a very emotional debate in Switzerland in a lot of region - regions. We are blocked to roll out the network. Today we have a coverage of 90% on the basis of dynamic spectrum sharing, so we have a coverage on 5G but we have problems to roll out or to densify the network now because of all this - of all these debates. In the last two or three weeks, I think there is some hope that the debate is becoming more rational. And we have now some parties in Switzerland which really is supporting 5G Well, I think mid-term we will be in a better situation but the debates on building mobile networks will stay an emotional one in Switzerland. On 5G additional ARPU, we will - it's on our ambition to charge for additional speed additional money. But at the end, the question, how does the whole market will behave on this topic? And overall I don't think that 5G will be - really be an ARPU increases, it will lead to more SIM cards, high penetration of mobile, which will bring us additional business. And on the channel ARPU development, I think we will have some pressure also in the future driven from the B2B segment and driven by more by 2nd and 3rd brands.

Now, if you look at the CHF 4 decline, so, about 50% come from the RGU mix and the other 50% come from roaming and convergence. Say, overtime, roaming and convergence, that will reduce, as you have mentioned on the RGU mix on the 2nd and 3rd brand is declined. We expect that will continue also in the future.

Okay, thank you very much.

And this concludes the last question from the Q&A session. And I give back to Urs Schaeppi.

Sorry, do you have another question?

And no, that this was the last question from the Q&A session.

Okay, well then thank you. And with that, we would like to conclude today's conference call. Should you have any further questions, please do not hesitate to contact us from the IR team. Thank you and have a great day.

Dear participants, your conference call has come to an end. Thank you for attending. Goodbye.