Operator: Ladies and gentlemen, thank you for standing by and welcome to 2Q, 2019 Investor and Analyst Call. At this time all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. [Operator Instructions] I’d like to advise you that this conference is being recorded today, Thursday, 1 August, 2019. I’d now like to hand the conference over to the first speaker today, Nik Kershaw.

Thank you, please go ahead.

Nik Kershaw: Good morning, ladies and gentlemen. Welcome to the VEON second quarter results presentation. Nik Kershaw here, Head of Investor Relations, I'm pleased to be joined on the line with Ursula Burns, our Chairman and CEO; Trond Westlie, our Chief Financial Officer; and Kjell Johnsen, our Chief Operating Officer. For the presentation, we will start with an overview of the first half of our financial year and our business priorities from Ursula and after that we will get operational overview for the second quarter by country level from Kjell.

And then, Trond will give a review of the financial results for the balance of the year after which Ursula will conclude with some final remarks. And then, obviously after that we will move onto the Q&A. Just before we get started, I would like to remind you that we may make some forward-looking statements during today's presentation, which involve certain risks and uncertainties. These statements relate in part to the Company's anticipated performance and guidance for 2019, future market developments and trends, operational and network development and network investments and the company's ability to realize its targets and commercial and strategic initiatives, including current and future transactions. Certain factors may cause actual results to differ materially from those in the forward-looking statements including the risks detailed in the Company's annual report on Form 20-F and other recent public filings made by the company with the SEC.

The earnings release and the earnings presentation, each of which includes reconciliations on non-IFRS financial measures presented today can be downloaded on our website. And with that I’d just like to hand the call over to Ursula.

Ursula Burns: Thank you, Nik and good morning everyone and thanks for taking the time for dialing for our interim results announcement. As you’re aware, I’ve been in my role as CEO or Executive Chairman for the past 18 months or so. As I look at VEON today, the business has seen significant positive change over this period and we now have a stronger grasp of the business and the clear understanding of our investment case.

Our investment case is first and foremost built around strong operational execution and I think our track record over the past four operating periods are evidence that we’re making clear traction in this regard. Secondly, moving to a more appropriate group structure remains a priority for us and while this will be an ongoing process, I think that the recent progress with GTH again shows that we’re moving forward in this regard. We believe that our simplified and streamlined group will allow us to unlock value for shareholders over the medium term and will continue to look at ways that we can achieve this. And lastly, managing an appropriate capital structure is vital to our success as a group. This is a balance between investing in CapEx for the core telecoms business managing and gearing at the group level, investing in new growth areas and returning cash to shareholders through dividends or buybacks.

Now if we look at Slide 5 in our results pack, you will see for the interim period organic revenue and EBITDA were up 7.4% and 10.7% respectively. Encouragingly we’re tracking ahead of our guidance at the interim stage. Our guidance on equity free cash flow remains at around a billion dollars for the full year and here we remind you that this does not include the impact of the tax payments associated with the GTH MTO process. Trond will go through this in more detail during his presentation. Financial metrics in the second half of 2019 are more challenging and for this reason we would caution against extrapolating first half financial trends for the full year.

That being said, there is directionally some upside to both our revenue and EBITDA performance as we move into H2. Reflecting on this performance the Board has approved the distribution of an interim gross dividend to our shareholders of $0.13 per share with the record date of 14 August, 2019 compared to $0.12 declared in quarter two of 2018. Moving onto our strategic priorities. First, enhancing our core. We continue to invest across our markets improving both data capacity and coverage, while market conditions in Russia remain challenging, the strong results from Ukraine and Pakistan ensured a balance performance for the group.

We continue to target cost efficiencies both at the head office as well as across our operating companies. In this regard, we’re on track to achieve our 25% reduction in head office costs for the full year and the cost intensity ratio for the group improved by 2.3 percentage points organically year-over-year in the first half. We continue to actively manage our portfolio and I’ll give you a little bit of cover on the GTH process in more detail in the next slide. Lastly, investing for future growth, here in particular, we’re making good progress with Jazz Cash and we’re stepping up investments on this to take advantage of the big opportunity that Pakistan presents with its 225 million people, many of whom lack access to basic financial services. I’d like to take a moment just to talk to you about the GTH process.

As you saw, the announcement that we released on June 26, this was a collective process during which we worked closely with various authorities in Egypt to put us in the best possible position to get a successful outcome that benefits all stakeholders. While we’re not yet in a position to have a definitive view on the MTO, we’re optimistic about the outcome. We expect to make an announcement on or around the 6 August, on the MTO process. With that I’d like to hand this over to Kjell, who will take you through our operational results by country. Kjell?

Kjell Johnsen: Thank you, Ursula.

I’m very happy to report on overall very good numbers and I’d like to take you through some of the key operating companies. Let me start with the biggest one in Russia. Well, we would say that the operating environment is fairly challenging, we’re executing on the strategy of optimizing our monobrands in a bid to focus on value creation in the market rather than Euroset. This has been giving results, we see ARPU still increasing, but the growth coming down. We’re also executing on strengthening our networks to build a more robust position in Russia.

The overall target going forward for the management of Russia would be to stabilize the customer base in fairly challenging markets. In the fixed area, I’m happy to report that for the first time in many, many quarters, we’re back to some growth and that is due an effort over quite some time to upgrade our city range and our [indiscernible] businesses leading for the first time in many quarters growth in Russia. The challenge going forward will be within the mobile market where we do see a very active company towards price points on flat rates and we’re still trying to drive the market towards by being predictable, but we think that this can take a bit of time before the turnaround comes in the overall mobile market of Russia. We expect to stabilize the customer base and try to move the market back towards some ARPU growth overtime. When it comes to Ukraine, I’m very happy to report solid performance.

Ukraine, Pakistan, Uzbekistan and Kazakhstan are markets where we can play quite a leading role in developing the overall markets. We’re taking that responsibility and setting the market conditions in the Ukraine and that leads to value creation and growth. Some of these countries have relatively high inflation and we need to compensate for that overtime, which is the task that we put in front of ourselves. Kyivstar has developed a strong 4G network which came along way although in the last year we’re continuing to build-out capacity and coverage and we’re also now increasing to putting some effort into developing our fixed line as soon as we’re a key overall telecom operator in the country. We’ve a quite big development or topics program pushed out into the Ukraine, so I’m pretty sure that we will have a strong backing core continuing the performance also into next year.

We’ve very good news in terms of the ability to upstream cash from the Ukraine. The Central Bank has liberalized the market giving us the opportunity to take out our profits from the Ukraine without the limitations that we have in the past, which is of course, a solid contribution to the overall group. In Pakistan, we’re again, like I said, executing as market leader. We’re well underway on the 4G, we see that we’re performing good relative to the other main players in the markets. We’ve had a lot of external factors influencing the business, the suo moto and the amortization fees.

The suo moto of course was helpful to our numbers for some period of time and has been abolished, but we are also seeing the underlying growth excluding the suo moto coming in with very healthy numbers. So the secular growth of population in Pakistan is of course helping us in the long run and our ability to perform versus competition seems to be at the same strong level as it was in the previous quarters. Coming over to Algeria, very challenging from the political thing, we are working in the market full of turbulence. We have been able to develop our network resources in a decent way over the last couple of quarters. The turbulence has actually not been able to take away some of the opposite rules we had in the past, but is still a difficult landscape to navigate.

Compared to competition, we do see the earnings announcements of others that we have had a good quarter and we are relatively satisfied with the overall development in Nigeria. Although of course, would have liked to see more stability and an economy coming back to growth. Bangladesh has moved from being a drag in our performance to now showing very strong numbers. We see improvements quarter-over-quarter leading onto the growth figures of this one with 5.4% top-line growth. This is down to a very surgical approach of where we apply our CapEx.

The Bangladesh management team has done an excellent job providing the CapEx where it gives good return on our investments. And we are now more hopeful that we will see positive trends staying on for some time. It's still a complicated market from a regulatory point of view, but we have seen a good ability of navigating those obstacles over the last year or two. There are some developments in Bangladesh that we have to relate to, its introduction of the SMP regime. We're just going to have some impact to our business, but net-net it should be positive for Banglalink.

Uzbekistan another one of those markets where we execute the strategy as market leaders. We have strengthened the organization there quite significantly. We are executing well on driving ARPUs up in the market. We are far ahead of the plans of the 4G rollout. So we are building strength in the position in Uzbekistan and Uzbekistan is also one of those countries where we have secular population growth.

So it's a long-term bet that has a good potential for long-term growth. We also see that the authorities of the Central Bank are handling the reserve situation very well. So we are able to upstream money out of Uzbekistan which was of course not the case, if you go back two years ago. There are some tax effects that we have to relate to here. At the end of last year, there was some excise tax put in place which cosmetically leads to negative numbers for us on the top-line, at EBITDA it evens out.

The good news is that while introducing the excise tax, the authorities also reduced the sum tax from 4000 Sums to 2000 Sums which is a positive step. So overall, we'll continue to advocate a better structure of the tax system of Uzbekistan and net-net business improvement overtime for VEON. That will take me to the key of course, so I'm happy to take any questions that you all might have. Trond Westlie So going to the financial results we are delivering another good quarter with our second quarter 2019 results. The total reported revenue is $2.3 billion.

That is 7.5% organic growth and slightly below zero or flat each year-over-year in dollar terms. We’re also reporting EBITDA if you look at same reporting level pre-IFRS 16 of $866 million that's 11.1% organic growth year-over-year and 1% reported growth year-over-year. The reported post-IFRS is higher due to the changes of accounting policies which is just short of $1 billion, which is a recorded growth of just above 16%. A couple of specifics this quarter, we have a revenue of other income of $38 million coming from Kazakhstan and in the EBITDA that flows through, but in addition to that as a result of the DTH settlement on taxes, EBITDA is charged with $27 million. So the net effect is limited on the EBITDA, but its $38 million effect on revenue base.

Going to the equity free cash flow pre-IFRS that's just short of $250 million that includes all the two effects I mention on the Kazakhstan of $38. It's the first payment of taxes in DTH with just above $50 million and in addition to that it's including the second payment from Ericsson of 175. But if you look at the effect year-over-year and the cyclicality of the year it really follows the flow as previous years. Reported post-IFRS numbers is 338. Going then to the revenue and EBITDA development by country, we see that [indiscernible] Pakistan and Ukraine driving the growth.

Pakistan a very good market, but also one caveat, just a small caveat in it is, suo moto is a part of the second quarter number in April but not in May and June. On Ukraine, we do have as also as you’ve mentioned from data led growth that drives the revenue development. On the other side of $60 million in growth we see it's the Kazakhstan element that is giving the high number of 60. That leaves us on organic $2.439 billion, ForEx expect is 179. Even though it's high, it's actually much lower than it was in first quarter because the first quarter number were just belong $300 million.

So it's not half-in or we getting close to half effect of quarter-over-quarter effect on the revenue side. Now that of course, drifts through to the EBITDA and cash flow. On the EBITDA, same trend line as we see on the revenue, Pakistan and Ukraine is driving the development and in other parts of [quartile] and the tax element is also driving on the other side. So same trend lines on the Russia side, as Kjell mentioned there as well, challenging market some of the effects is down the DAT change that has happened as well as the [indiscernible] calculation that will have some effects on the quarterly numbers on Russia. If you look at in the next page on revenue and EBITDA byproduct, the data revenue is driving the organic growth and its really strong growth.

We see an organic growth of more than 22% in the data revenue that means the organic part of it and then the reported part is about 14% on the data revenue growth. If we then go to the EBITDA involvement, we see that service revenue is going up $106 million and cost is just going up 11% and there you actually see the effect over the cost intensity improvements as we have done in the second quarter. We're going down with cost intensity of 2.7% year-over-year in second quarter and we’re on a good trajectory to actually deliver on our longer-term plan over 1% a year. That also leads to a margin increases. So the 951 is actually a margin increase from up till 38.3% that's 0.6% margin increase better than last year.

The ForEx effect on the EBITDA is 86. If you actually deduct the 86 from the 951, you get to 866 and that means that coming from last year 857, it's actually covering for all the currency effects, the improvements of efficiency together with the revenue increase. Going into the overview of the income statement starting on the EBITDA level, we have the normal three columns we have the reported second quarter 2019. We have a pre-IFRS 16 to have numbers comparable to the reported number of 18 in the third column. And as you can see, 2019 in the mid column 866 as I just mentioned is actually even with the reported number last year in U.S.

dollars. Depreciation goes a bit down compared to last year and that leaves us an operating profit on pre-IFRS of 449 compared to the 383 last year. If you look at the current income and expenses comparable to last year 153, down due to leverage decline meaning that we’re paying less interest slightly countered by the change of hedging that we did last year to increase our Ruble denomination and as a result of that that interest cost of course is a little bit more expensive. But that leaves us a profit before tax of 285 in pre-IFRS numbers and reported number of 256. If you look at the pre-IFRS 16 numbers and compare them to 2018 numbers it's actually an increase of more than $124 million year-over-year.

In the tax line on 2019, there are two adjustment effects one is, $29 million coming out of the settlement in GTH this quarter and the second one is, an adjustment of a deferred tax assets as we had in the headquarter that has been written down with no cash effect. That leaves us at $187 million on pre-IFRS number and $182 million in the second quarter reporting. And net profit attributable to VEON shareholders according to second quarter 2019 reported number is now $70 million up from $142 million of loss last year. If you then go to the cash flow slide, you see that from an operational view, every country is contributing positively to the operational cash flow. Of course, headquarter is a cost element as we mentioned before and we see the evolvement of working capital is a positive one mostly driven by the Ericsson countered by the supplement of GTH.

And then interest tax and other, I will come back to that on the next page. On the next page, is the usual net debt flow starting the quarter or starting the quarter with the debt of just sort of $6.2 billion, you see the normal effect of EBITDA, working capital, finance charges, taxes and CapEx really driving the volume now specifics, beyond the three elements that I mentioned in this and that leaves us at a net debt of 6.1 slightly down from end of first quarter and still a giving ratio of 1.7. Going then to the guidance and in terms of financial guidance, Q2 was another strong quarter for the group operationally with both revenues and EBITDA before exceptional items anticipating above the guidance points we communicated at our full year results 2018 presentation. As a result the group performance achieved during the first half leave us directionally trending above our guidance points of low single-digit organic revenue and low to mid single-digit EBITDA growth. However, the second half of 2019 looks more challenging with little or no sign of competition easing in Russia, Pakistan and Algeria and persistent headwinds of macro factors and changes in local tax regimes across many of our markets.

Equity free cash flow guidance remains at around $1 billion for the full year, which includes exceptional items like Ericsson and [quartile]. But please also note that business does not include the impact of the tax payments in GTH in Egypt. Underlying this is a long term run rate or equity free cash flow generated by our operating businesses over around $800 million which I discussed in some detail during our full year 2018 results in February. As before, I will caution that equity free cash flow remains dependent on the movement of our functional currency against U.S. dollars which we cannot control however, we continue to mitigate this.

So the things we can control particularly cost intensity of reduction and driving growth in services across our operating companies. So with that I hand it back to Ursula for her closing comments.

Ursula Burns: So thank you, Trond and let me conclude today's call with four final comments. The first half of 2019 was a period of strong operational execution during which we met our targets and we delivered on our commitments to shareholders both in terms of financial guidance which we are reconfirming today and returns through our dividend. This puts us on the strong footing as we enter the second half of the year in which financial metrics are expected to become more challenging.

Second, cost control is fundamental to how we manage our business both at the group level and throughout our operating companies. Here I am pleased to see that our commitment to reducing organic cost intensity is yielding early results, underscoring our ability to operate a lien efficient group for the benefit of our stakeholders. Fundamentally to this thirdly, we are moving towards a simplified corporate structure and ongoing progress in restructuring GTH is an important milestone. And fourth, we are aware of the need to develop and expand our services in order to drive long-term growth across our business. Here thinking beyond our current connectivity business to the new services and future assets that will inspire the loyalty of our customers over the long term will remain a core focus for the group in the quarters to come.

More on this at Capital Markets Day which is scheduled for 3 September, in London. And finally, I'd like to thank Trond, this is the last time that we'll hear him on the earnings calls for VEON. He has been a true soldier and a great server on behalf of VEON's stakeholders. So thank you, Trond.

Trond Westlie: Thank you.

Ursula Burns: And with this, we can now open the Q&A session. So operator?

Operator: [Operator Instructions] And your first question comes from the line of Cesar Tiron, please ask your question.

Cesar Tiron: Yes. Cesar from Bank of America, thanks for the call and the opportunity to ask questions. I have three questions if I may.

The first one, can you please talk again about the pricing and competition in Russia particularly, saw the introduction of an unlimited data offer or you get the first three months for free. Can you please elaborate a little bit? And then, in Pakistan it seems that the license award comes with a very high price tag. It's probably in line with expectations, but you mentioned that it can be appealed, are you going to appeal the decision? And then finally, I just wanted to cross-check the run rate of the decline of corporate cost year-on-year because I know there was a provision reversal in 2Q. So was that decline around 15%? Thank you so much.

Kjell Johnsen: Should I do one and two?

Ursula Burns: Yes.

Kjell Johnsen: So when it comes to Russia and the price setting in that market it is clear that what we see there is not a healthy market. There has been a direction towards unlimited tariff plans to buy some time. Our approach to that has been along several channels. First of all, we are the leader of the market when it comes to FMC. We are trying to build more capacity within the FMC part of our business which shows more loyalty and brings more value to customers.

Secondly, when we in a way have to reply to the ongoing tough competition in the market, the kind of offerings that you refer to are usually structured as try and buy so that you get an opportunity to use those kinds of plans. What we then monitor is towards the end of this period, how many people stay on beyond the try before buy so to speak, and we do see some more positive trends in terms of the ability to steer customers towards these kinds of packages and stay on. So it's not our intention to drive the market towards even more of the unlimited rights and the unlimited tariff plans. This is a way to try to steer people towards a tariff plan within our system that will bring value over time. But I would repeat my initial statement that the overall development of the Russian market, the way the competition has played out for the last year or so after two of the players started fighting with each other it has not been healthy.

It would be, at some point this will have to turn around to start focusing more on value. When it comes to Pakistan and the license renewal, we have followed a very clear approach. We have had a dialogue with the regulator about the license renewal. We came to a point in May where there was no information memorandum available and we protected our customer base and ourselves with the actions we took in the court in Pakistan. Since then, there has been a couple of iterations also administered by the court.

We are reviewing all of these options and will of course inform the market and everyone else in due course about our decision whether to appeal or not. So this is in process.

Trond Westlie: On the corporate cost it's about $60 million this quarter. It's slightly higher than last year, but I can confirm that the 25% reduction year-over-year that we have as a target in 2019 is still our target and we're in route to delivering on that and that also means that our run rate ambition for getting into 2020 still remains of around $215 million. So I can just confirm that and we haven't put another slide in this quarter because it's just confirmation of our previous thing.

Cesar Tiron: Thank you very much.

Operator: And your next question comes from the line of [indiscernible], please ask your question.

Unidentified Analyst: Yes. Thanks for the call, couple of questions. Firstly, again on Russia.

So Russian mobile service revenue went from positive in Q1 into the negative growth in Q2, but it seems like both VAT and roaming effect was in both quarters. So do you see any intensified competitions throughout Q2 in particular and also where do you see second-half trending should the comps are closer to the end of the year? And secondly, with regards to changes in Bangladesh taxes, you mentioned that 2019 EBITDA effect is 5.7%, [indiscernible] from which time those changes are effective from i.e., in other words did we observe any implications for 2020 numbers as well? Thank you.

Kjell Johnsen: So again, returning to Russia. I think to the large extent have to repeat what I said earlier. Of course, the overall price building of the market has not been in a direction that we try to set it a couple of years ago, for the single value where use more, spend more.

It has become more focus on specific price points and of course as a player with a market share around 28.5, the big three or around 24-25 the big four, we have to relate to that overall market and the price building that we see out there. So there has been some impact from the roaming changes, but those are transient things that with the overtime compensate short term impact. And I wouldn't be too concerned about that. What fundamentally needs to change in the Russian market is that we need to get back from focusing only on driving speed of the unlimited plans and build different value proposition. And when it comes to the second half of the year, it's clear that if these trends prevail it is going to be tougher.

Now what we are going to put in front of us, absolute target is the realization of the subscriber base and I think that's a realistic ambition to strive for. The challenge will be to continue the upward trend of ARPU that we have successfully executed on for several years. So these two things go in opposite directions. I hope that answer your question.

Unidentified Analyst: Yes.

Thank you very much and on Bangladesh.

Kjell Johnsen: Yes. Well, there have been some adjustments to the cold in Bangladesh with respect to the last budget that was available about a month ago or so. And we do see that Bangladeshi authorities are looking to raise revenues in multiple directions and one of them is also impacting us. So of course, that's a negative for the development of Banglalink.

Although, we should see this more balanced because there are also some of the regulatory changes that are being proposed will have a positive effect on us.

Trond Westlie: No. So, as we say in the report, recently I haven't seen the actual date of the implication. So Investor Relations has to come back on those specific dates.

Kjell Johnsen: What you can remember is that when it comes to smart phones, the duties are up, but also some of these producers are producing in country.

So there is a mix here of not everything placed straight into the tax. So maybe we should come back here with the more detailed view.

Unidentified Analyst: Thank you very much.

Operator: And your next question comes from the line of [Indiscernible], please ask your question.

Unidentified Analyst: Yes.

So, couple of questions on the Russia if I may. So first one, so you mentioned on your speech that you are looking at expanding your distribution network in the country. So I am just wondering whether you are thinking of expansion of your distribution network or you are talking about the improvement of the utilization or you might be talking about the partnership with the other players to improve the quality of your distribution and then come back again to the improvement of the subscriber base? So that's the first question. Second one, do you see your current network coverage as sufficient or do you think it needs to be improved because looking at the statistics in the market looks like, you have the lowest number of base stations on the market now and whether you see this as a problem? And the other one probably outside of the core telecom segment in Russia, which have product initiatives that you planned this year if you can share anything? Thank you.

Kjell Johnsen: Well let's go to distribution first.

We have been on the journey for a couple of years to move out of the washing machine of the multi-brand towards monobrand and then we spent a lot of works and effort on building a good quality, high quality monobrands structure in Russia and we have by and large done that. So the task going forward is of course, this substitution thing. We have areas or [indiscernible] that are outperforming up to the standard. We would move them or build elsewhere but this is normal course of business. So that's what we do internally and that will be an ongoing process.

Now I would not want to see us going back to working with other players in order to have a multi-brand again because that'll take us back to the washing machine that we have had in the past where we don't have a direct relationship with customers to your retail. So I would think and I've said this for a couple of years, the long-term direction for the Russian market is to reduce the number of retail stores and again I welcome the statement by the CEO of MTS that he says there are far too many shops, too many retail points, it's too expensive. I fully agree. I think the Russian market if it's well structured, I'm not so much focusing on process but more focusing on the tension and value creation probably could have had something like 40% less retail points then it has today. But obviously, would say that a tremendous amount of costs.

So that's our thinking around the retail. When it comes to the network, Russia is a huge country. So you can never have full coverage everywhere, but we have very good population coverage and we spent a lot of effort and money over the last couple of years together with vendors to get a fastest speed of rollouts. So 2018 was a year where we had a quite good rollout also compared to the others. We did have a little bit of catch up from the batch, but I'm happy to say that the efforts that we're undertaking especially in Moscow with our super city project and also in other cities have made our network little more robust.

This is the job that will never end and it's going to be continuous and I believe are much more robust now than we were two or three years ago. I am sorry, could you repeat the third question please?

Unidentified Analyst: Yes, sure. So in Russia outside of the core telecom segment, you have any product initiatives which you might share with us currently or kind of skip it and discuss it later if the time is a problem?

Kjell Johnsen: Yes, another short answer to that we are predominantly working internally with developing our [indiscernible] when it comes to our digital initiatives, we have a good group of people there that has a strong Beeline competence. We do have these both competencies in terms of technical and human resources in place. We are working with partners where we also sell in services.

We have come a long way with the development of our Beeline TV. What we previously used to call our self care, we will now call a B2C ecosystem and the number of people who use the B2C ecosystem with us is not that far of what you would have, the most popular messenger like Whatsapp and in terms of usage on our customer base. So we are moving in this direction. Where we are a bit different maybe from the market leader is that we are raising the bar very, very high for making any acquisition. So we are more inclined towards internal development down acquisitions.

Unidentified Analyst: Thank you.

Operator: [Operator Instructions] And our next question comes from the line of Maria Sukhanova. Please ask your question.

Maria Sukhanova: Thanks for the call. Three questions from my side.

First on GTH tender offer on this progress, you said that you’re going to think about that and I wonder if your optimism based on just -- you think, the whole propositions attractive for minorities or it's also based on the initial results that you see from, in the terms of a buyback? Second, with new addition to the team [indiscernible] should we expect some, like new preposition on your side in terms of digital services and when do you think you'll be able to update the market on that? And third, I'm just wondering in terms of your progressive dividend policy, so if you look at the figures for this year just rough calculations, if you deduct from the underlined $1 billion cash flow, the frequency payments that you expect, you seem to be, like the dividend seem to go ahead above this figures. So, in the longer term also with 800 million expectations for underlying cash flow and 300 averages of payments that also in frequency, so it also seems that you will be in more that you're going to earn. So I wonder are there any positives factors that are not included in this guidance that you think you'll be able to continue paying progress in dividend? Thank you.

Trond Westlie: On the GTH, and we are in that just because we do think it's a good offer to the minorities; I think that's very fundamental issue. When it comes to the interests, we are limited according to book or legislation in Egypt to actually comment on what we see or already accepted or how many has accepted the offer.

But of course, all the certain chances is driving us towards that optimism. And so, overall I do think that we are optimistic, we are positive, we think we have a good proposal both to the minorities. I think we have a good alignment on understanding with the stakeholders in Egypt and it's good for the structural length and its reputation or for we have. So, all-in-all, that the reasons why we are optimistic.

Ursula Burns: And let me take the next two on ventures.

Here we announced that we hired an executive to lead this activity. This activity is focused on taking the assets that we have on some of our core telco business and expanding those close to our core to offer more services and value to our clients. It's too early to tell yet exactly where this will go but you should start by looking at the activities that we have in Pakistan around our digital financial services, offers in Jazz, Jazz CAT. These are types of activities that we want to accelerate in Pakistan and expand if possible on around some of the other geographies. Trond and Kjell spoke a little bit about Beeline TV and some of the B2C ecosystems offerings that we have in Russia.

These are also the types of activities that the Venture's Group will be looking at to strengthen and accelerate but also to expand around the other geographies. At the Investor Day in September, we'll probably spend a little bit more time talking about that in particular and I'm hoping that you will be able to meet in person on the lead of the Venture's Group because he should be there at that time and you'll get his initial ideas in person. As far as the dividend goes, we're very pleased to be able to offer a dividend now payable in a couple of weeks to our current holders. And as we said earlier in last earnings call and I'll reiterate again, a dividend policy is to continue to actually provide returns to our shareholders but it's really based on our free cash flow trends and that really again based on currency. But you should people should be committed in or confident in our commitment to continue to provide a strong dividend to our shareholders.

Maria Sukhanova: Okay, thank you very much.

Operator: And your next question comes from the line of Ondrej Cabejsek. Please ask your question.

Ondrej Cabejsek: Hi, thank you. Two questions from me, please.

One on Pakistan where we've had the reversals of the taxes and you've clearly been more successful than some of your competitors in offsetting these reversals. I'm just curious if you could guide us through how you're doing this business purely just driven by price increases. And if so, do you expect the risk you see that the regulator would sort of push back against the path and these taxes back on to the consumer the same way they have done so in the case of the service charges that some of your competitors have implied. And then, second question regarding this talk to the distribution in Russia. So, it's been discussed that your contract this was that is up for renewal in the mid-2019.

If you could just update on how you're thinking about this especially in the light of MCS returning to Svyaznoy and then your current goal of stabilizing your subscriber base there. Thank you.

Trond Westlie: Yes, thank you. Let me start with Pakistan. We're very happy to see that the investments we've done into 4G and networks there really are paying up to terms of not only growth of traffic but also growth of data revenues.

And looking at 59% year-over-year growth of data revenues is smart is spectacular. So, we got to continue down that path. When it comes to the taxes and the rate in development introduced or the Supreme Court took primarily to suo moto and then reversed and then made some changes to this. I would just highlight that there are some differences in how these things are attributed from the accounting point-of-view. There are of course that's a shorter thing to the medium terms in this of course that the industry will work to flow back the fees that all have been now cancelled out.

There used to be a part of the preposition before this also. So, it was reasonable for us to expect that when suo moto was reversed, that it would remain in place and now we had clarification of that. So, it will be for us and industry to adjust our pricing models to compensate at least partially for a loss of data revenue. But again, the substance or the matter is that we are in a very fast growth in terms of the data usage in Pakistan. We see a huge growth of the 4G enabled smartphones and that is translating into service revenue growth and we are very satisfied with that.

When it comes to the dissolution in Russia and the issue of Svyaznoy, not Svyaznoy MTS into Svyaznoy, I wouldn’t want to comment on what actions we are planning to take there. I would leave it for the firm to communicate what actions you take with respect to the specific contracts in Russia. Now, the longer-term and please don’t read too much English, I'm just saying that the longer-term direction should be away from multi-brand here and do not exclude that multi-brand would be with us for some time will pick up.

Ondrej Cabejsek: Thank you. And it's just a shout for opinion.

Can you give us an idea of when these negotiations are to take place at all -- so and so but are there any.

Trond Westlie: Well, I don't but remember exact dates on this but I do remember that the relationship with Svyaznoy was really oscillated not very long time ago in terms of how we want to drive the performance through that channel more towards customers that stay with us over time. And always when you're working with a multiple brand channel, you try to structure the compensation so that you don’t pay people just to sell a huge target. We pay them to provide you would customers that stay with you over time. And then you have iterations of on how you try to capture this in contract labels and also the development of skills with the employees who work in the touch points.

So, but I wouldn’t want to go more into those details.

Ondrej Cabejsek: That's great, thank you very much.

Operator: And your last question comes from the line of Anna Quindlen [ph]. Please ask your question.

Unidentified Analyst: Hello, thanks for taking my question.

It's just a clarification for the previous one about Pakistan. So, taken into account some changes in taxes and as we remember there is still more to resume which was in the second half of the previous year but now it's came to the end and time to spend there. Might be some press adjustments but looking forward to the second half of this year for example, taking into account all changes do think that here and here we can expect some decline in revenue trends in Pakistan or do you think that's underlying trends of the revenue will offset all tax change. Thank you.

Trond Westlie: Obviously the suo moto when it was introduced, changed the numbers quite significantly.

And taking away suo moto and the administration fee has the opposite effects. So, where we are now we're talking about a growth of our customer base, we're talking about having an underlying growth of our revenues. But obviously to compensation in full for suo moto and lack of administration fee, it works going to happen for any other players in the industry. So, let's focus on key thing here, so focus on the current growth rate, the underlying growth rates and try to keep that up to the best of our abilities. That's the task we set in front of the management.

Kjell Johnsen: I mean, Anna, maybe just to add to that, just remember the suo moto later came to an end on the 24th of April. So, already it was out for two months in the quarter and it was it's really just the administration fee which also in the quarter which will now come out. So, for sure there will be although revenue flows will be growing but the growth cycle for sure slowdown in the coming periods. Yes.

Unidentified Analyst: Okay, thank you.

Operator: There are no further question at this time, please continue.

Nik Kershaw: When you see no further questions, I'd just like to thank everyone for dialing in. we will be meeting a number of investors and analysts over the coming weeks. We thank you and well if you got any questions, please just reach out to us. Thank you, very much.

Operator: And that does conclude the conference for today. Thank you, for participating. And you may all disconnect. Speakers, please standby.