Cuộc họp công bố kết quả kinh doanh quý 3/2026 của Millicom (TIGO): EBITDA kỷ lục và tiến triển tại Colombia

Những điểm chính

• Millicom công bố doanh thu dịch vụ quý 3/2026 đạt khoảng 2,1 tỷ USD, tăng 61% theo báo cáo và tăng 5,4% theo phương pháp hữu cơ so với cùng kỳ năm trước.
• EBITDA điều chỉnh đạt mức kỷ lục theo quý là 1,1 tỷ USD, tăng trưởng hữu cơ 7,7%. Biên EBITDA điều chỉnh đạt 48%, bất chấp khoản chi phí khoảng 30 triệu USD liên quan đến trợ cấp thôi việc.
• Dòng tiền tự do vốn cổ phần tăng gần 30% so với cùng kỳ năm trước lên 316 triệu USD. Dòng tiền tự do vốn cổ phần trong 9 tháng đạt khoảng 870 triệu USD, giúp Millicom duy trì đúng lộ trình hoàn thành mục tiêu cả năm khoảng 1,1 tỷ USD.
• Doanh thu dịch vụ di động tăng trưởng hữu cơ 7,2% lên 1,3 tỷ USD. Millicom có thêm gần 390.000 khách hàng trả sau, nâng tổng lượng thuê bao trả sau tăng gần 31% lên 17,2 triệu.
• Theo ban lãnh đạo, rủi ro tích hợp tại Colombia về cơ bản đã được giải quyết. Hoạt động tại thị trường này ghi nhận tăng trưởng doanh thu dịch vụ hữu cơ đạt 7,5% và biên EBITDA điều chỉnh đạt 44,2%.
• Hệ số đòn bẩy vào cuối quý giảm xuống 2,53 lần. Ban lãnh đạo duy trì lộ trình đưa đòn bẩy xuống dưới 2,5 lần dựa trên phạm vi hoạt động hiện tại và khả năng tạo tiền mặt.

Dữ liệu tài chính trọng yếu

Kết quả kinh doanh và hoạt động

Mảng di động

Trong quý, Millicom có thêm gần 390.000 khách hàng trả sau. Tổng lượng thuê bao trả sau đạt 17,2 triệu, tăng gần 31% so với cùng kỳ năm trước, trong khi lượng thuê bao trả trước cũng tăng 7,8%.

Xu hướng chuyển dịch từ trả trước sang trả sau tiếp tục là động lực tăng trưởng then chốt. Nhóm khách hàng trả trước hiện hữu đóng góp 73% doanh số thuê bao trả sau của tập đoàn. Ban lãnh đạo cho biết sự chuyển dịch này, cùng chính sách giá kỷ luật và chiến lược “more-for-more”, đã hỗ trợ tăng trưởng ARPU và doanh thu dịch vụ di động.

Mảng hộ gia đình

Lượng khách hàng mảng hộ gia đình giảm 86.000 thuê bao so với quý trước. Khoảng một phần ba mức giảm này liên quan đến trận động đất tại Colombia, trong khi phần còn lại chủ yếu phản ánh các đợt điều chỉnh giá và tỷ lệ rời mạng cao hơn ở nhóm khách hàng nhạy cảm về giá.

Dù lượng thuê bao phát triển mới giảm, doanh thu dịch vụ hộ gia đình vẫn tăng trưởng hữu cơ 3,4% lên 542 triệu USD. Tỷ lệ thâm nhập hội tụ cố định - di động (FMC) đạt 38%, trong đó mức giảm so với quý trước phản ánh việc lần đầu tiên hợp nhất Coltel - đơn vị có tỷ lệ thâm nhập thấp hơn mức bình quân của tập đoàn.

Mảng B2B và dịch vụ kỹ thuật số

Doanh thu dịch vụ B2B tăng trưởng hữu cơ 2,1% lên 404 triệu USD. Doanh thu dịch vụ kỹ thuật số tăng 5,9% lên 105 triệu USD, được hỗ trợ bởi nhu cầu đối với các dịch vụ điện toán đám mây, an ninh mạng và dịch vụ quản trị (managed services).

Doanh thu dịch vụ kỹ thuật số giảm so với quý trước do một số dự án doanh nghiệp và chính phủ kết thúc. Ban lãnh đạo dự báo tăng trưởng sẽ có phần chững lại trong ngắn hạn khi doanh thu từ các dự án này giảm dần, bao gồm cả mức nền so sánh cao từ một dự án lớn tại Panama trong quý 4/2025.

Colombia

Doanh thu dịch vụ tại Colombia tăng trưởng hữu cơ 7,5% lên 908 triệu USD. EBITDA điều chỉnh tăng trưởng hữu cơ 6,3% lên 470 triệu USD, bao gồm khoảng 20 triệu USD chi phí trợ cấp thôi việc. Biên EBITDA điều chỉnh đạt 44,2%, mức mà ban lãnh đạo mô tả là cao nhất từ trước đến nay của bộ phận này.

Hoạt động của Tigo và Movistar đã được hợp nhất dưới thương hiệu Tigo vào ngày 14/10. Millicom có kế hoạch tăng gấp đôi vùng phủ sóng 5G, bổ sung công suất tại hơn 5.000 trạm phát sóng và xây dựng hơn 1.000 trạm mới. Ban lãnh đạo khẳng định các khoản đầu tư này sẽ vẫn nằm trong ngân sách CapEx hiện tại của công ty.

Trận động đất tại Colombia khiến công ty mất khoảng 27.000 khách hàng và gây thiệt hại tài chính ước tính khoảng 10 triệu USD. Ban lãnh đạo cho biết tác động này không quá trọng yếu so với quy mô hoạt động tại đây.

Guatemala

Doanh thu dịch vụ tại Guatemala tăng trưởng hữu cơ 6,5% lên 392 triệu USD. EBITDA điều chỉnh tăng 7,6% lên 255 triệu USD, trong khi biên lợi nhuận đạt mức kỷ lục theo quý là 57,2%, bao gồm khoản lợi ích một lần trị giá 4 triệu USD từ việc hoàn nhập một số nghĩa vụ pháp lý.

Millicom cũng đạt được thỏa thuận giải quyết dứt điểm mọi vụ kiện tụng và khiếu nại trọng yếu còn tồn đọng tại Guatemala. Một khoản chi phí hàng chục triệu USD ở mức cao (high double-digit million-dollar) đã được ghi nhận vào chi phí và thu nhập ngoài hoạt động khác.

Các thị trường khác

Doanh thu dịch vụ tại Panama tăng 5,2% lên 179 triệu USD, trong khi EBITDA điều chỉnh tăng 3,5% lên 96 triệu USD. Tại Paraguay, EBITDA điều chỉnh tăng trưởng hữu cơ 11% lên 101 triệu USD, với biên lợi nhuận đạt 54,8%.

EBITDA điều chỉnh tại Ecuador tăng 36,8% lên 57 triệu USD, đạt biên lợi nhuận 47,8%. Sau sự kiện ra mắt thương hiệu Tigo vào ngày 1/10, ban lãnh đạo dự kiến biên lợi nhuận quý 4 sẽ hạ nhiệt do chi phí tiếp thị và khuyến mại tăng lên.

Tại Chile, thị trường không được hợp nhất do Millicom nắm giữ 49%, doanh thu dịch vụ nhìn chung ổn định và biên EBITDA điều chỉnh đạt khoảng 33%, tăng gần 10 điểm phần trăm so với cùng kỳ năm trước. Ban lãnh đạo kỳ vọng mảng kinh doanh này sẽ tạo ra hàng trăm triệu USD dòng tiền tự do vốn cổ phần vào năm 2027.

Định hướng của ban lãnh đạo

Millicom duy trì định hướng dòng tiền tự do vốn cổ phần cả năm 2026 ở mức khoảng 1,1 tỷ USD. Ban lãnh đạo dự kiến dòng tiền quý 4 sẽ tiếp tục khả quan nhưng có thể triển khai sớm một số khoản đầu tư và sáng kiến chọn lọc để chuẩn bị cho năm 2027.

Công ty cũng duy trì lộ trình đưa đòn bẩy xuống dưới 2,5 lần, dựa trên phạm vi hoạt động hiện tại và khả năng tạo tiền dự kiến.

Thị trường Colombia dự kiến sẽ hưởng lợi trong năm 2027 từ toàn bộ hiệu quả tích hợp tính theo tốc độ quy năm (full run-rate) và việc cắt giảm thêm chi phí thương mại. Ban lãnh đạo cho biết biên EBITDA điều chỉnh tại đây có thể tiệm cận mức 50% vào năm tới, đồng thời nhấn mạnh rằng vẫn cần tiếp tục nỗ lực thực thi.

Millicom dự kiến lượng thuê bao phát triển mới mảng hộ gia đình sẽ tiếp tục chịu áp lực trong quý 4 do công ty duy trì chiến lược giá. Công ty cũng dự kiến ghi nhận thêm khoảng 40 triệu USD chi phí tái cấu trúc tại Colombia trong thời gian còn lại của năm 2026.

Rủi ro và các yếu tố cần theo dõi

• Các biện pháp điều chỉnh giá mảng hộ gia đình có thể tiếp tục làm tăng tỷ lệ rời mạng và gây áp lực lên lượng thuê bao phát triển mới, đặc biệt là nhóm người dùng nhạy cảm về giá.
• Colombia vẫn đối mặt với các yêu cầu thực thi tích hợp, chi phí tái cấu trúc phát sinh và việc khắc phục sự cố gián đoạn mạng cố định do động đất.
• Tăng trưởng mảng B2B có thể biến động khi các dự án lớn với khối doanh nghiệp và chính phủ hết hạn trước khi các hợp đồng thay thế bắt đầu có hiệu lực.
• Biên lợi nhuận quý 4 của Ecuador dự kiến sẽ giảm bớt do các khoản đầu tư cho thương hiệu, tiếp thị và khuyến mại gia tăng.
• Chile vẫn là thị trường cạnh tranh gay gắt với 4 nhà mạng, trong đó việc khôi phục tăng trưởng doanh thu là mục tiêu hàng đầu của ban lãnh đạo.
• Ban lãnh đạo cho biết các biện pháp kiểm soát vốn và cơ chế tẩu tán vốn liên quan đến đồng USD tiếp tục khiến Venezuela trở thành thị trường khó đầu tư.

Điểm nhấn phiên hỏi đáp với chuyên gia phân tích

Ban lãnh đạo cho biết các chương trình phát triển mạng lưới tại Colombia và Ecuador sẽ được hoàn thành mà không làm tăng tỷ lệ CapEx của Millicom. Các kế hoạch này bao gồm mở rộng vùng phủ sóng 5G và 4G, bổ sung công suất và xây dựng các trạm phát sóng mới tại những khu vực chưa được phủ sóng đầy đủ.

Về hoạt động M&A, ban lãnh đạo tiếp tục ưu tiên mua lại cổ phần thiểu số, củng cố vị thế trong cùng thị trường và một số thị trường lân cận chọn lọc tại Mỹ Latinh. Brazil không phải là ưu tiên do quy mô lớn, tiềm năng cộng hưởng hạn chế và ít cơ hội xoay chuyển tình thế, trong khi Venezuela tiếp tục bị cản trở bởi các biện pháp kiểm soát luân chuyển vốn.

Millicom cho biết dư địa chuyển dịch từ trả trước sang trả sau còn rất lớn do hiện chỉ có khoảng một phần ba lượng khách hàng sử dụng dịch vụ trả sau. Hoạt động thu cước được hỗ trợ bởi các phương thức thanh toán số, mạng lưới ngân hàng và các điểm thu hộ tiền mặt của bên thứ ba.

Công ty đã công bố mức cổ tức bất thường 0,75 USD/cổ phiếu bổ sung vào mức cổ tức quý hiện tại 0,75 USD/cổ phiếu cho cả quý 1 và quý 2/2027, tương ứng tổng mức chi trả là 1,50 USD/cổ phiếu trong mỗi quý.

Ban lãnh đạo đã thảo luận về mục tiêu nội bộ đạt 2 tỷ USD dòng tiền tự do vốn cổ phần trong trung hạn thông qua tăng trưởng hữu cơ, mở rộng biên lợi nhuận, nâng cao hiệu quả chuyển đổi tiền mặt, các biện pháp tối ưu hóa chi phí và tiềm năng từ M&A. Công ty nhấn mạnh đây là mục tiêu nội bộ gắn liền với kế hoạch đãi ngộ, không phải là định hướng chính thức cho thị trường.

Toàn văn biên bản cuộc họp công bố kết quả kinh doanh

Toàn văn cuộc gọi công bố kết quả kinh doanh

Phần trình bày của ban lãnh đạo

Luca Pfeifer

Hello, everyone, and welcome to our third quarter 2026 results call. This event is being recorded. Our speakers today will be our CEO, Marcelo Benitez, and Bart Vanhaeren, CFO of the camp. The slides for today's presentation are available on our website, along with the earnings release and our financial statements. Please turn to Slide 2 for the safe harbor disclosure. We will be making forward-looking statements, which involve risks and uncertainties, which could have a material impact on our results.

On Slide 3, we define the non-IFRS metrics that we will be referencing throughout this presentation, and you can find reconciliation tables in the back of the earnings release and on our website.

With those disclaimers out of the way, let me now turn the call over to our CEO, Marcelo Benitez. Marcelo?

Marcelo Benitez

Thank you, Luca, and welcome, everyone, to our third quarter 2026 results call. I'm very pleased to report another strong quarter for Millicom, with record adjusted EBITDA, solid revenue growth and strong cash flow generation. I want to start by emphasizing that these results are not happening by chance, they are the result of a clear strategy and consistent execution across our operations. We continue to focus on the same priorities, improving customer experience, investing in our networks, strengthening commercial execution and making our organization more efficient every day.

On the commercial side, we continue to see very positive results from our more for more strategy. We are giving customers larger allowances, better connectivity and a better overall experience while gradually increasing ARPU.

In prepaid, it's not simply about increasing prices, it's about giving customers more value, keeping them more engaged and building stronger customer relationships. At the same time, we continue migrating prepaid customers to postpaid, increasing convergence in our home business and expanding our digital services offering for B2B customers. And of course, efficiency remains a fundamental part of our culture. We continue simplifying our operations, improving productivity and applying the Millicom playbook across our markets. This combination of strong commercial execution and cost discipline is driving our financial performance while we continue investing in the long-term growth of our business.

Before going into the quarterly results, I want to highlight 2 important milestones from October. First, Colombia. In October 14, we officially brought our combined operation under Tigo brand, bringing together the strengths of Tigo and Movistar -- this is another important step in our integration and in building a stronger and more competitive operation. Together with the brand consolidation, we announced an ambition investment plan for the next 4 years. This includes doubling or 5G coverage, increasing network capacity at more than 5,000 sites and expanding coverage through more than 1,000 new sites and continuing to invest in fixed and digital infrastructure. This is a significant commitment to improving network quality and the experience of millions of customers in Colombia.

We also reached another important milestone in Ecuador. On October 1, we officially launched the Tigo brand in the country. And just as in Colombia, our focus goes well beyond the brand itself. We have already increased network capacity to more than 2,000 sites, and our plan includes building at least 500 additional sites, mainly expanded coverage along the coastal region. Our objective is clear: bring better connectivity to more people, improve customer experience and build a stronger business over time. Both initiatives show how we are combining network investment with strong commercial execution to deliver profitable and sustainable growth.

Before reviewing the numbers, I also want to acknowledge 2 difficult events during the quarter. Both Colombia and Panama experienced significant earthquakes. Sadly, in Colombia, we lost 1 of our employees and 1 of our contractors. Our thoughts are with their families and loved ones, and we continue to support them during this difficult time. The earthquake also affected our networks and disrupted services for many customers. I want to recognize our teams in both countries for their extraordinary response. Despite very challenging conditions, particularly in Colombia, our colleagues restored service at all affected [indiscernible] sites within just 2 days and worked tirelessly to keep our customers connected. Fortunately, our operations in Panama were not materially affected. In Colombia, the impact on our fixed network lasted longer and contributed to a decline on home customer additions during the quarter. I'll come back to this when we discuss our home business.

Now turning to our results. At the group level, service revenue reached approximately $2.1 billion growing 5.4% organically year-over-year. Adjusted EBITDA reached a new quarterly record of $1.1 billion, growing 7.7% organically with an adjusted EBITDA margin of 48%. Equity free cash flow reached $316 million for the quarter, up 27% compared to last year. This brings our equity free cash flow for the first 9 months to approximately $870 million, keeping us on track to deliver our full year guidance of around $1.1 billion.

What I particularly want to highlight is the consistency of our performance. We continue growing revenues, improving efficiency and converting that performance into a stronger cash generation.

Our commercial strategy also continues to deliver. We added almost 390,000 postpaid customers during the quarter. In Home, we lost 86,000 customers sequentially, reflecting both the earthquake in Colombia and our deliberate approach to pricing and customer value. I will explain these dynamics in more detail shortly, but importantly, home service revenue increased 3.4% year-over-year.

Overall, these results demonstrate the strength of our operating model, we continue generating strong earnings and cash flow while investing in the quality and competitiveness of our business. Starting with mobile. We continue to see strong results from our commercial strategy. As we have discussed in previous quarters, one of our main priority is migrating prepaid customers to postpaid. This quarter, 73% of our postpaid sales came from customers migrating from our existing prepaid base. This shows the strength of our commercial execution and our ability to move customers to higher-value plans, giving them more data, greater predictability and a better overall experience.

Our postpaid customer base reached 17.2 million, growing almost 31% year-over-year. Importantly, our prepaid base also grew 7.8% year-over-year. So we continue growing postpaid while maintaining a large prepaid customer base, which gives us a significant opportunity for future migration. At the same time, our more for more strategy continues to deliver. We are offering larger allowances and better value, supported by continued investment in our networks.

In prepaid, we are also focused on improving customer engagement and helping customers to stay connected more consistently. And when customers migrate to postpaid, they typically stay connected for nearly twice as many days each month. This improves their experience while also supporting loyalty and long-term customer value.

Together with disciplined pricing, these initiatives continue to support ARPU growth. As a result, mobile service revenue reached $1.3 billion, growing 7.2% organically year-over-year. These results demonstrate how customer migration, better monetization and consistent execution are supporting our mobile growth.

Turning to our home business. We continue to focus on improving customer value, increasing convergence and delivering a better broadband experience. During the quarter, our customer base declined, mainly due to 2 factors: the first was the earthquake in Colombia, which affected our fixed network and disrupted services for a significant number of customers. Approximately 1/3 of the sequential decline in home customers was related to the earthquake. The second and more significant factor was our deliberate commercial approach. We continue implementing our more-for-more strategy, offering customers faster speeds, better connectivity and more value while adjusting our pricing. We recognize that this can lead to higher churn, particularly among more price-sensitive customers. But our priority is to increase customer value and revenue rather than grow subscribers at any cost, and we are seeing encouraging results.

Home Service revenue reached $542 million, growing 3.4% organically year-over-year despite the pressure on subscriber additions. Another important driver is convergence. Our fixed mobile convergence penetration reached 38%. The slight sequential decline reflects the inclusion of Coltel's FMC metrics for the first time this quarter as Coltel has a lower FMC penetration than the group average. Convergence remains a very important part of our strategy because these customers tend to be more loyal with churn historically around half that of nonconvergent customers. Going forward, we will continue investing in our fixed networks, upgrading speeds and expanding our convergent offers. We expect some continued pressure on subscriber additions in the fourth quarter as we maintain our pricing strategy, but our priority remains the same, delivering a better customer experience, increasing customer value and supporting sustainable revenue growth.

Let's now turn to our B2B business. In B2B, we continue to see good opportunities, particularly in Digital Services and the SME segment. During the quarter, B2B service revenues reached $404 million, growing 2.1% organically year-over-year. Digital Services revenue reached $105 million growing 5.9% organically compared with the last year, supported by continued demand for cloud, cybersecurity and managed services. Compared with the second quarter, Digital Services revenues declined mainly because certain B2B and government projects came to an end. As a result, we expect some moderation in the near term as those projects revenues roll off.

Looking ahead, we remain confident in the opportunities across our B2B business.

Our focus is on expanding our digital services portfolio, improving sales productivity and strengthening our position in the SME and corporate segments.

Next, I would like to discuss our 2 largest markets, Colombia and Guatemala. I am very pleased with the progress we are making in Colombia. Following by the acquisition of Coltel, our teams moved quickly to integrate operations, simplify our business, improve efficiencies and implement our commercial strategy. With the most intensive phase of the integration largely behind us, our focus is now shifting more towards commercial execution and capturing the opportunities from our expanded customer base, and we are already seeing encouraging results. Our prepaid to postpaid migration strategy continues to perform very well. During the quarter, 71% of our postpaid sales came from customers migrating from prepaid. Our postpaid customer base reached $10.2 million, growing 7.4% year-over-year excluding Coltel. This is a strong result, particularly considering the size of the combined operations. At the same time, our more-for-more strategy continues to support ARPU growth.

On the Home side, our customer base declined 2.8% year-over-year, again, excluding Coltel. As I mentioned earlier, this reflects both the impact of the earthquake and our delivery pricing strategy.

Convergence is another important opportunity. Our FMC penetration in Colombia, now including Coltel, reached 40%, and reflecting continued progress in bringing fixed customers and mobile services together across our combined customer base. And with the recent consolidation under the Tigo brand, together with the investments announced in October, we are entering in a new phase for our business in Colombia. We now have the scale, the network investment plan and the commercial strategy to increase customer value and improve profitability over time. There is still work ahead, but the progress we have made gives us even more confidence in the combined operation in Colombia.

Guatemala continues to deliver excellent results and remains one of our best examples of what consistent execution of the Millicom playbook can achieve. Our prepaid to postpaid migration strategy continues to perform extremely well. During the quarter, 87% of our postpaid sales came from existing prepaid customers. Our postpaid customer base reached 1.6 million, growing 18.7% year-over-year. And importantly, this is not just a 1 quarter result, we have delivered postpaid customer growth above 18% in every quarter so far this year. At the same time, our more for more strategy continues to support ARPU growth. We are offering customers larger allowances and better customer value, supported by continued network improvements and disciplined pricing.

Together with our pre-to-post migration, this is improving our customer mix and building stronger customer relationships, and these commercial trends continues to translate into strong revenue growth. Mobile service revenue reached $301 million, growing 6.8% organically year-over-year. Guatemala continues to demonstrate how a clear strategy executed consistently over time can deliver strong and sustainable results.

Before handing the call over to Bart, let me briefly update you on Chile. During the third quarter, service revenue was broadly stable compared with last year, with only a marginal decline. At the same time, the team has made significant progress in simplifying the operation and improving its cost structure. With the initial restructuring program largely completed, we are now seeing the benefits in profitability.

Adjusted EBITDA margin improved by almost 10 percentage points year-over-year, reaching approximately 33% during the quarter. This is an encouraging result, particularly given the competitive environment in Chile. As a reminder, we hold 49% stake in the business and its revenue and adjusted EBITDA are not consolidated into Millicom's group results. There is still work ahead, but the progress achieved in just 8 months shows what the disciplined execution can deliver.

I want to congratulate Carolina, our CEO in Chile, and the entire team for their commitment and the progress they have made.

Before closing, I want to reinforce 1 message. We are very pleased with our financial results. But what gives us more confidence is how we are achieving them. We have a clear strategy. We are investing in our networks, improving customer experience growing ARPU through more for more and becoming more efficient every day. And we are applying this approach consistently across all our operations. Our priority is not just to deliver 1 strong quarter, it's to build a stronger Millicofor the long term. I want to thank all our Tigo teams across Latin America for their commitment and outstanding execution.

With that, let me hand over the call to Bart to review our financial results in more detail. Thank you.

Bart Vanhaeren

Thank you, Marcelo. Let me now walk you through our financial performance for the third quarter. We delivered another solid quarter with reported service revenue increasing 61% year-over-year to $2.1 billion. Importantly, organic service revenue growth, which excludes foreign exchange movement and the Coltel acquisition, reached 5.4% year-over-year. This marks our fourth consecutive quarter of organic service revenue growth in the mid-single digits and demonstrates the continued execution of our commercial strategy supported by prepaid to postpaid migration and disciplined pricing that continues to support ARPU expansion across most of our markets.

Adjusted EBITDA reached a quarterly record of $1.1 billion, increasing 7.7% organically year-over-year. Once again, adjusted EBITDA grew faster than service revenue, demonstrating the operating leverage we have been focusing on. On a side comment, amplifying this message, when adding Coltel on a pro forma basis, adjusted EBITDA increased by 12.7% year-over-year. This further highlights the underlying momentum of the business and the scalability of our operating model. As a result, our adjusted EBITDA margin reached 48%, even after absorbing approximately $30 million in severance-related expenses during the quarter.

Importantly, our operating performance continues to translate into healthy cash generation. Equity free cash flow reached $316 million for the quarter, increasing almost 30% year-over-year. With that, Total equity free cash flow for the first 9 months of the year reached approximately $870 million close to our original full year equity free cash flow target in just 9 months.

Let's now review the performance of our individual markets. Starting with Colombia, we can now say that the most intensive phase of the integration is behind us, with a local team increasingly focused on commercial execution. Service revenue increased organically 7.5% year-over-year, reaching now $908 million, supported by the continued application of our commercial strategies across the expanded customer base.

Turning to Guatemala. We delivered another solid quarter with organic service revenue increasing 6.5% year-over-year to $392 million, supported by postpaid customer growth and disciplined pricing.

In Panama, we saw a further acceleration in top line growth, with service revenue increasing 5.2% year-over-year to $179 million, driven by mobile subscriber growth and incremental B2B projects.

Paraguay, Ecuador and our other markets are growing, respectively, 3.6%, 3.3% and 4% on the back of continued prepaid to postpaid migration and again, disciplined pricing.

Let's now turn to the profitability of our operations. For the country profitability, let's start again with Colombia. We are very pleased with the speed of execution and the resulting turnaround. Adjusted EBITDA organically increased 6.3% year-over-year to $470 million for the quarter, including approximately $20 million in severance-related expenses. As a reminder, we expect approximately $40 million in additional restructuring expenses during the remainder of the year. So now half a year into the integration, we reached an adjusted EBITDA margin of 44.2%, bringing up the acquired lower-margin business from Coltel to our highest EBITDA margin in Colombia ever, despite still incurring integration costs. Given that Coltel integration was widely viewed as one of the key execution risks for Millicom, the results shown to you today reinforce our confidence that this risk is largely behind us and that the combined operation offers further upside potential towards profitability levels in line with other Millicom countries.

Turning to Guatemala. The business continues to demonstrate the strength of our operating model. Adjusted EBITDA increased 7.6% year-over-year to $255 million, supported by healthy service revenue growth and continued cost discipline. I would note that the third quarter benefited from a $4 million onetime benefit coming from reversing certain legal liabilities. Including this reversal, the adjusted EBITDA margin reached 57.2%, a new quarterly record for the operation.

I would like to use this moment to provide an important update regarding the litigation proceedings in Guatemala that we disclosed in our second quarter results. I'm pleased to report that we have reached a settlement, resolving all pending material litigations and claims. Under the agreement, we recorded a high double-digit million dollar expense in the quarter, recognized as other nonoperating income and expenses. With these matters now resolved, we have removed a significant source of financial and regulatory uncertainty in the country. This outcome allows our local management team to now focus fully on commercial execution, operational efficiency and sustaining the strong underlying performance that Guatemala has consistently delivered.

Now turning to Panama. Adjusted EBITDA increased 3.5% year-over-year to $96 million, representing an adjusted EBITDA margin of 51.9%. Paraguay once again delivered strong operating leverage, with adjusted EBITDA increasing 11% organically year-over-year to $101 million, reaching a margin of 54.8%.

Turning to Ecuador. As of today, we have passed the first anniversary of our acquisition, and we are very pleased with the progress achieved. Adjusted EBITDA increased 36.8% year-over-year to $57 million, representing a margin of 47.8%. Following the launch of Tigo brand on October 1, we expect some margin moderation in the fourth quarter as we increase marketing and promotional investments, consistent with what we communicated in our previous earnings call.

Finally, our other markets also delivered strong results, with adjusted EBITDA increasing 5.9% year-over-year to $194 million, reaching an adjusted EBITDA margin of 47.7%.

Let's now turn to equity free cash flow bridge for the quarter. As discussed, adjusted EBITDA reached $1.1 billion, increasing by almost $400 million year-over-year. Cash CapEx totaled $263 million, up $91 million year-over-year. This primarily reflecting continued investment in our recent acquired businesses and the impact of timing differences previously disclosed in our second quarter earnings call.

Spectrum payments amounted to $67 million increasing $46 million year-over-year, mainly due to the spectrum related payments in Colombia and Paraguay. Taxes paid, finance charges and lease payments increased year-over-year, mainly due to expansion of our operating perimeter through acquisitions as well as profitability.

Honduras repatriation remained broadly unchanged year-over-year at $22 million for the quarter.

Putting it all together, equity free cash flow increased almost 30% year-over-year to $316 million. Importantly, we continue to deliver strong cash generation while absorbing the incremental investments, financing costs and restructuring-related cash requirements. Before moving on to the net debt bridge, let me remind you that the fourth quarter is typically the strongest quarter for cash generation. However, the improvements we have implemented across the business have significantly reduced the seasonality of our cash flows. As a result, we expect a solid and orderly finish to the year, supported by continued robust cash generation in the fourth quarter to reach our guidance equity free cash flow level for the year, but as well starting strongly next year.

Now turning to our net debt and leverage progression. The key message here is straightforward. Our strong operating performance continues to translate into healthy cash generation, supporting our deleveraging objectives. During the quarter, we generated $316 million of equity free cash flow, which more than offset our regular dividend distribution and the adverse impact from derivatives and foreign exchange movements. Together with continued earnings growth, this resulted in a reduction in leverage ratio, now down to 2.53 at quarter end, again, in line with our guidance for the full year, but now achieved in 9 months.

In summary, we are reducing leverage while continuing to invest in our networks and return capital to shareholders, reflecting the cash-generating capacity of our expanded operation.

To summarize the third quarter; one, another solid continuation of the trends we have seen throughout the year; two, the integration risks are now largely behind us; three, Guatemala risks, legal and regulatory removed; four, setting us up for continued focus on our strategy to deliver healthy growth, further margin expansion and growing equity free cash flow; and five, converting this performance into strengthening of our balance sheet while maintaining our commitment to shareholder distributions.

As a quick update on our noncontrolled subsidiary in Chile, we recently renegotiated the earn-out arrangement with the seller, providing greater flexibility around capital allocation and future upstream distributions in exchange for an additional earn-out payment. Importantly, this obligation is financed at the joint venture level and carries no recourse to Millicom. The business is already generating mid- to high double-digit millions of equity free cash flow annually, and we expect this to be triple-digit million next year. Together with our partners, we are evaluating the optimal use of this cash generation, including distributions, accelerated deleveraging and incremental commercial investments to support future growth.

Based on our year-to-date results and our expectations for the remainder of the year, we are maintaining our full year financial guidance. We continue to expect equity free cash flow of around $1.1 billion and our path to the leverage below 2.5x remains intact based on current operations perimeter and cash flow generation.

With that, let me now open the call for questions.

Luca Pfeifer

We will now begin our question-and-answer session. As a reminder, if you'd like to ask a question, please let us know by e-mailing us at investors@millicom.com, and we will add you to the queue.

Our first question of the day comes from Gustavo Farias from UBS.

Phần hỏi đáp

Gustavo Farias

Can you hear me?

Luca Pfeifer

Go ahead.

Gustavo Farias

So on my end, first of all, congrats on the results, very strong, very positive. So the first question regarding the investment program, for the next 4 years in Colombia and also in Ecuador. What should we expect in terms of CapEx intensity along that period? And I'm asking that in the light of what is -- what we are seeing CapEx intensity very stable so far? And my second question, just to get an update on the current opportunities that you guys are seeing in LATAM for M&A. And right now, I'd like to be very specific on potential opportunities in Brazil and Venezuela. If you could give us an updated view on those markets.

Marcelo Benitez

Thank you for your question, Gustavo. I will take the first part of your question, and we'll ask Bart to answer to the second part. So basically, what we saw in Colombia is an opportunity to strengthen our network. We announced that we will double the 5G coverage. Second, that we will increase capacity in mainly urban areas in mobile and fixed. And third, we are going to build more than.

[Technical Difficulty]

Luca Pfeifer

Gustav, I think we lost you.

Are we back?

Gustavo Farias

Yes. For some reason, audio was interrupted and didn't hear your answers.

Luca Pfeifer

No worries, we'll start again.

Marcelo Benitez

Yes, no worries. So the strategy in Colombia and Ecuador is very similar. In Colombia, now we have the scale to invest. So we are on an aggressive plan to increase coverage of 5G to double our existing coverage to increase capacity mainly in the urban areas where the demand is extremely high. And third, we are building new sites, more than 1,000 sites that will cover 3 million customers that today has either no option or no connectivity, or they have only 1 option. So that's more or less the same playbook we are doing in Ecuador or basically with the purchase of the 700 spectrum, we already increased the capacity immediately in all our sites. Also, we are investing in new 4G sites and capacity in the Quito region or let's say, in the region where we have a strong competition.

And we also found that in the coast, we had very, very small coverage compared to our competitors. So we are investing in 500 new sites in the coastal region. So all that is made by our team with very, very specific design of the network. And also, we are using the Millicom price list for when it comes to negotiate with the vendors.

So we do not expect the ratio of CapEx to increase. We expect to do all this investment under the same envelope.

Bart Vanhaeren

Yes. On the M&A side, I think our story there is consistent. So first, I think we look at minorities and this was largely executed. Do we look at in-market consolidation. You've seen us doing this as an example, in Colombia, but there are more opportunities as we have still multiple players in some of our markets, right? But then coming to your question number 3 would be adjacent markets. In a past quarterly call, I mentioned Peru and Venezuela as kind of a spot-on strategy. Venezuela, specific to your question, has still a number of capital flight mechanisms, especially related to the dollar in place. So it makes it still a hard investment. Brazil is generally too big, a different culture, limited synergies, limited turnaround stories. Many of these companies are already at 50% EBITDA margin. So it's not, let's say, a first area to look at.

In some of the past stories, I mentioned Brazil and Mexico, as areas that are not necessarily on top of our mind. So we're looking more on the rest of LatAm, I would say.

Luca Pfeifer

Our next question comes from Anders Joelsson with DNB.

Andreas Joelsson

A question from my side. First of all, you mentioned this part on the cash flow and the seasonality. Is there anything that we should be more aware of for Q4? I mean, implicitly, you need to deliver in line what you did in Q1 in order to reach the full year guidance. And now you have a much better position in Colombia, for instance. So given that, it seems quite reachable. So just thinking of how we should think for Q4 and also the run rate into 2027?

And my next question is on Colombia, which you also alluded to that the profitability is now almost at the group level. Would you think you can reach that within the sort of short to midterm and then have a sustainable development from once you reach that level?

And finally, from my side, I think maybe I'm not up to date, but it seems like you are increasing the dividend by $0.75 per quarter. Should we see that as an extra dividend? Or is that more an ordinary dividend going forward as well?

Bart Vanhaeren

Let me just take the 1 on Colombia, and then you do the other 2 high. Andreas, in Colombia, the main drivers for profitability has to do to sustain top line growth at a high single digit. Second is that we are going to see in '27 the full run rate effect of all the efficiencies we did during the transition and the merge. And also, we do see further efficiencies mainly in commercial activities. So all that should bring us very close to the 50 club level next year.

Of course, our ambition is to get there, but we do see at least to be very close.

Marcelo Benitez

On that Club 50, we have now half of our countries in Club 50. So definitely, we want to bring in more countries into there.

Bart Vanhaeren

And we want to open the Club 60. That's a challenge for Guatemala.

Marcelo Benitez

Sure. But back to your first question, Andreas. So the equity free cash flow you pointed out that we removed quite some of the seasonality out of the business. If you see a lot of telcos, it's negative Q1 equity free cash flow and then a lot in Q4. We don't have that. We brought it more in line with the dividend distribution basically, right? So to have a more smooth path during the year. You may have heard me in a prior call saying for the performance of a year, you start to win it in the Q4 of the year before in Q2, you risk losing it and in Q3, you protect it. So we are now looking at opportunities for our 2027 year so we could bring in some investment forward, some initiatives to normalize and things like this to really prepare for 2027.

Our teams are already looking at 2027. I think those are the big parts.

To your last question, dividend distributions, we announced in the last quarter extraordinary dividends of $0.75 on top of the existing $0.75 per quarter for both Q1 and Q2 of next year. We have our AGM in May. The AGM declares from May to May, our dividend policy with the first dividend paying after an AGM being 15th of July. So in May of next year, we will know the July to June -- July '27 to June '28 dividend policy. But [indiscernible] $1.5 in Q1, $1.5 in Q2.

Andreas Joelsson

I'll pay better attention to the extra dividend in the future.

Marcelo Benitez

It's always good news.

Luca Pfeifer

Our next question comes from Fan Kanamori with HSBC. Mani?

Unknown Analyst

So the first question is on your prepaid to postpaid conversion. You have -- you're converting where you have a lot of pace that you can convert, but what we have observed in other markets is that you need access to digital banking, whether it's credit cards or others to actually do this conversion. Is that a risk for you in terms of conversion? Or are you using some kind of cash mechanism to welcome this risk, especially in the Central American markets.

And then the second question is regarding Colombia with the brand integration, what are the benefits that you are expecting in Colombia?

Bart Vanhaeren

Thank you, Phani, for your question. On the first one, remember, we have only 1/3 of our customers in postpaid and we are going 5 percentage points per year. And on the other hand, you have countries like Chile and Uruguay, where 90% of the customers are postpaid already. So all this is to say that there is a long runway to increase the days connected of our prepaid customers. We are targeting the customers that are using more than 20 days to migrate them to postpaid. And then we are migrating customers that are connected 7 days, 10 days to 15 days. So there is a lot of work to do there.

In terms of collecting the bills, we have 2 sources of collection, all 3, if you want. Number one, is digital. Of course, you do see that bancarization in countries like Paraguay and Panama through a very aggressive digital wallet penetration incentivized by the biggest banks there. You do have access to pay it from your bank account.

Second, we do have a very large capillarity of banks collecting these bills on our behalf. And number three, there are a lot of mom and shops collectors that are distributed -- very well distributed across the country for cash-in and case purposes. And in those places, we have also the ability to -- and these are third parties ability to collect.

So we don't see any issues with collection and a long runway to increase our postpaid.

The second question was about Colombia, right?

Marcelo Benitez

Yes. Phanid, I also missed the second question.

Unknown Analyst

Okay. So you are integrating your to versus the Movistar brands. How do you expect that to benefit Millicom going forward in 4Q and 2027?

Marcelo Benitez

Got it. So this was not only a change of color or a change of name, right? There is a strong investment behind. So number one, we are going to have more presence of 5G, double of our presence. So we are going to be -- in the main cities we are going to have full coverage of 5G that, of course, is going to bring more customers and also customers are going to be able to upgrade to 5G phones with higher plans. Second, we improved the quality of service across our network. Because before when we were 2 companies, we didn't had the scale to really be able to offer a good experience -- a good navigation experience. Now, and we are investing in increasing capacity. And number 3 is that we are starting to get into cities where we were not before. So naturally there, we are going to cover the 3 million new Colombians. So naturally there, these customers, they have either no connectivity. So a big opportunity for us to penetrate those areas. And second, these customers may have just 1 operator as an option. So it's a natural that we will grab a piece of that market as well.

So this is going to, of course, bring a lot of strength to the brand, combined with, as you know, we are very, very good at commercial execution. So this may bring customers and also in prepaid. So that allow us to start migrating to postpaid and the value ladder that is very well known from us.

Bart Vanhaeren

So Phani, maybe just to add to the financial side of it, bringing to 1 brand also brings the front end in one company, let's say, which at the moment, you can have KPIs for the sales reps harmonized to the best-in-class in between the 2 companies and hence decrease your commercial costs. So linking it to the question before of getting -- aspiring towards the 50%. This is an intentional step that allow us to reduce commercial costs and improve further margin expansion in Colombia.

Luca Pfeifer

Our next question comes from Marcelo Santos with JPMorgan.

Marcelo Santos

I have 2 on my side. The first is about Chile. I mean it seems a lot of the operating turnaround seems done, at least from the margin levels we're showing. It's below your average margin, but a 4-player market seems pretty high. What's next on your playbook on Chile given that looks like you cut a lot of the costs already?

The second question is about we saw this potential $50 million bonus. In case you reached $2 billion of free cash flow in the midterm, was disclosed in the financial statements, what is midterm here? Could you talk a bit more about this? I mean is this something that you're envisioning?

Marcelo Benitez

Thank you, Marcelo. So on Chile, the first priority is to return to growth on the top line. We are very close to be there. This quarter, we had marginal negative growth, so that is the first is to stabilize the commercial operation to start increasing the base and start increasing the ARPU. So that's the first priority. We do see positive trends from that perspective. From the cost perspective, I mean, that's our day-to-day. We are going to increase. We're going to still -- to have still opportunities to be more efficient in Chile, and we will grab all these opportunities. So we do see a much better a much better profile in Chile. And we are improving the commercial execution and operation it is starting to be translated, as I said, in better margins and positive cash flow. And next year, Bart mentioned that we are going to be in triple-digit equity free cash flow. So that is outstanding for a company that was losing $400,000 per day.

So I think the trajectory is positive, but we are very cautious because we are in a very competitive market. So that's why the target #1 is to return to growth, and that's the most complex task we have in Chile.

So on the bonus, we love to put ambitious targets to our team. That's the way we work. we are very, very motivated to get there. Important to understand what are the levers and what's the accelerators that we see. I mean, the levers are the ones you see high middle single-digit growth predicated on basically what I said to Phani, that is, we have a long runway for increasing the postpaid base, and we're increasing ARPU, also increasing ARPU in prepaid. In Home, I think it's important to look at it a bit different because the 3 metrics in Home are net adds, ARPU and cash to revenues. So even though you see a very flat top line growth or shy top line growth, we are growing the contribution from cash to revenues on around 3% to 4%. So we do believe that in Home, the main opportunity is to become more and more efficient in the way we capture customers, in the way we retain customers, and that's where we're pointing towards.

And then we have the efficiency program. We do see a lot of AI adoption already in the day-to-day operations. So we are going to translate that into efficiencies. Just next year in the cost of care is going to just migrating to digital use cases and AI is going to give us $30 million in savings. So we do see a lot of that also being part of this this new ambition of being in $2 billion.

I just want to say, and Bart is going to, I think, repeat this, this is not a guidance. This is an internal target that we do want to share with you because that's the way we operate, very transparently. And this is, of course, bringing a lot of work, internal work to start thinking on how to do things differently, and we call them how to find accelerators to be there as fast as we can.

Bart Vanhaeren

Thank you, Marcelo. Just to complement on the financial side, indeed, it's -- we're not opening new guidance here. I recall when we had our first budget on the turnaround was $600 million and the teams are laughing this is an Excel budget or a paper budget. So we set an ambitious target and then you kind of develop what you need to do. So in line with Marcelo's mid-single digit will be quickly -- growth, we'll be quickly at just a mid-single digit to this year, we had $9 billion revenues. We want to target 50% EBITDA margin, we're at 48%. We want to then reach 20% equity free cash flow on that, so 20% of $9 billion are $1.8 billion. And from there, you continue either organic growth for some time. So that's the midterm range, operational leverage on the growth, the accelerators that Marcelo talked about -- and why not M&A. M&A is always tricky. You have your cost of debt increase, so to become accretive look globally. It's not that easy. We've done it a few times now. but why not? So we have multiple angles to get there. It's not crazy, but again, it's not new guidance to the market here. It's a disclosure obligation on the back of an incentive plan that we received as management.

Marcelo Santos

And just rough follow-up. Roughly, midterm means what, like 3 years, 5 years, 6 years, like I don't know if you can add that?

Marcelo Benitez

But it's not the first time we did this. I mean we had an internal target of $1 billion to the team. I mean and that worked very well. And now -- and this triggers very positive. It is a very -- people start thinking on doing things differently, taking more advantage of new technologies. So it's triggering the right behavior from the team. So we do believe that ambitious target is what we what we want in the company.

Luca Pfeifer

Our next and final question comes from Ernesto Gonzalez with Morgan Stanley.

Ernesto Gonzalez

It's 2, the first 1 is on the tragic earthquakes in Colombia and Panama. If you could comment on the financial and operational impact? Anything you've seen or expect? And the next one is on B2B. We saw growth slow down slightly from the second quarter to the third quarter. Could you comment on what drove this? And what are your expectations for the segment?

Marcelo Benitez

Sure. The impact -- to the first one, the impact in Colombia was more or less we lost 27,000 customers. The financial impact is around $10 million. Of course, for the size of Colombia, it's something that is not material. Nevertheless, it was a very big event that demanded a lot of efforts from our team, as I said, to establish the services.

In B2B, we will see this. I mean, we are entering into -- we have 2 dimensions in B2B. One is the organic growth has to do with connectivity and basic digital services by segment. But also, we are entering into big projects. We have big projects in Colombia. For example, we used to manage all the traffic of Medigene. So we developed that solution many years ago. Also in Panama, we do telemedicine. It's a very big project for Panama. But these big projects expires, but just because the contract expires and then we need to find new ones. So the transition is what generates a little bit of a disruption, and that's what happened here. We had big projects that are phasing dow in this quarter. We're going to see that as well in the next quarter because we had in Q4 of last year, a big project in Panama. So we are going to see the effect of that as well. But the most important thing is that our organic growth is solid. The corporate is growing at 8% in connectivity plus the corporate segment. That is a bigger segment at 8%, and the small SME segment is growing at 5%. So there is going to be a moment where we are going to be less dependent on big projects, but also we have a pipeline of big projects. So you will see the effect -- seasonal effect of the big projects, which is, I think, positive because all these big projects come with good margins as well. So not the same as connectivity, but very positive margins.

Luca Pfeifer

This concludes our question-and-answer session. Thank you, everyone.