2. Visit our website and IR app:
www.tim.com.br/ir
AGENDA
Industry Overview.........................5
Recent Results……………..……….…..10
Network Evolution……………….…...17
Regulatory Update…………….……..21
Fixed Business……………………..…...25
Business Outlook………….….….…..28
Historical Data & Others…….….…32
TIM IR app
(English)
TIM RI app
(Portuguese)
3. KNOWING TIM 3
KNOWING TIM BETTER
15,000 km fiber
optical backbone
5,500 km fiber
optical backhauling
Growth
Via
Acquisition
Brazilian
Law
“Nível” 1 “Nível” 2
Legal
Requirements
Demand for
transparency and
disclosures
Highest level of
Corporate
Governance
Requirement of
protection for
minority
shareholders
100% Tag Along
Equal dividends rights
One single class of shares
Strict disclosure policy
Statutory Audit Committee:
• Report to Board of Directors
• Oversight Financial reporting
• Analyze anonymous complaints
Unique Telco company listed on the Novo Mercado
CORPORATE GOVERNANCE
TIM: A Huge Brazilian Company
Presence in Brazil since 1998.
16th largest Private Company in Brazil (source: Exame
Magazine - 2013).
Approximately R$32 billion of Market Capitalization.
74.7 million customers (27% Share)
The 2nd Player - Market and rev. share
More than 465,000 points of sales
More than 166 own stores
15 Customer Care Centers (16k attendants)
~13,500 Antennas
3,432 cities covered
95% of urban pop. covered
51,700 km of optical fiber network
~12,520 employees
23,000 indirect jobs
R$10.4 billion in taxes payments in 2013
R$3.9 billion invested in 2013
Sales
Network
Social
&
Economic
GROWTH STRUCTURE
Gross Revenues
(R$ bln)
Customer Base EoP
(mln customers)
19 20
25
28
30
2009 2010 2011 2012 2013
3.5
4.2
4.7
5.0 5.2
2009 2010 2011 2012 2013
41
51
64
70 73
2009 2010 2011 2012 2013
EBITDA
(R$ bln)
CAGR
+16%
CAGR
+12%
CAGR
+10%
5. TIM represents 30% of the industry mobile
revenue* while has 27% of the market share
TIM
Source: Anatel and Players balance sheet
Vivo
Claro Oi
Mobile Fixed Fixed BB Pay-TV Group
Customers 3Q14 (000´s) 74,877 657 145 n.a. 75,679
Market share 3Q14 26.9% 1.4% 0.6% n.a. ---
Net Adds 3Q14 (000´s) 674 - 24 n.a. 698
Net Adds 12M (000´s) 1,985 25 76 n.a. 2,086
Net Revs FY13 (R$ Mln) 19,264 657 19,921
Mobile Fixed Fixed BB Pay-TV Group
Customers 3Q14 (000´s) 79,823 10,939 4,287 727 95,776
Market share 3Q14 28.7% 23.9% 18.1% 3.7% ---
Net Adds 3Q14 (000´s) 466 -96 -83 39 326
Net Adds 12M (000´s) 3,209 502 89 174 3,974
Net Revs FY13 (R$ Mln) 23,002 11,720 34,722
Mobile Fixed Fixed BB Pay-TV Group
Customers 3Q14 (000´s) 69,636 11,519 7,297 10,343 98,795
Market share 3Q14 25.0% 25.2% 30.8% 53.2% ---
Net Adds 3Q14 (000´s) 860 315 252 238 1,665
Net Adds 12M (000´s) 2,204 1,463 903 930 5,500
Net Revs FY13 (R$ Mln) 12,773 20,424 33,197
Mobile Fixed Fixed BB Pay-TV Group
Customers 3Q14 (000´s) 51,427 16,692 6,545 1,032 75,696
Market share 3Q14 18.5% 36.5% 27.6% 5.3% ---
Net Adds 3Q14 (000´s) 346 -279 -22 146 191
Net Adds 12M (000´s) 1,414 -1,742 -63 121 -270
Net Revs FY13 (R$ Mln) 9,290 19,132 28,422
The mobile segment represents
78% of the industry access growth
*Mobile revenue considers only the 4 major players
Fixed / Mobile Fixed BB Fixed voice & BB / TVMobile
Fixed BB/ TV Fixed Mobile
BRAZILIAN TELCOS X-RAY
Fixed / Mobile
MACRO & INDUSTRY OVERVIEW 5
6. 56%
35.2 mi
43%
27.0 mi
62.8 mi
Possess
Internet
connection
Does NOT
Possess
Internet
connection
Total
Households
38%
High cost
43% of total active connections have
speed below 2Mbs
3%
37%
51%
91%
MARKET STRUCTURE CHANGING TOWARDS
DATA USAGE
Households with internet connection (%)
With Telephone
Only mobile phone
Mobile and fixed phone
Households Profile
Fixed phone only
Purchase Power
Salaries up to R$1.2k
Salaries up to R$3.1k
Average Cost
32 mln
2 mln
81 mln
106 mln
23 mln
53% of pop.
70% of pop.
Source: PNAD 2012, CETIC.br ‘ TIC Domicílios 2013, Company estimates
Re-visiting Market Structure...
Market Data Revenues Growth 2016 vs. 2012:
> 13 bln Reais on Mobile (+100%)
> 7 bln Reais on Fixed (+35%)
1
2
57 mln
3
83 mi
~R$40
~R$100Fixed: Voice and Broadband
Entry level plan
Mobile: Voice and Data
PTIM’s entry level plan
4 Access Growth
(users in mln)
Fixed
Mobile
Reasons for not having Internet:
12%
Lack of coverage
…with room to grow
MACRO & INDUSTRY OVERVIEW 6
128.0
23.5
2009 2010 2011 2012 2013 Ago/14
+ 5,5x
Aug/14
7. Widespread use of Social Media
(Social Network Users in Brazil 2011-2017)
BRAZILIAN INTERNET USAGE BOOM
Internet Penetration in South America
(Internet users per 100 inhabitants)
Strong adoption of Instant Messaging
(WhatApp mln users)
High Penetration of E-commerce
(E-commerce revenues in Bln US$)
8.4
11.0
17.0
2010 2011 2012
Amazon lauched
operations in Brazil
in Dec/12
83 mln Internet users –
Brazil is the 5th largest
nation in the world of
internet users
66%
60% 59% 56%
46% 44% 41%
37%
32% 32% 30%
24%
Arg Col Chi Uru Bra Ecu Vem Per Guy Sur Bol Par
56.1
66.2
78.3
88.3
97.8
104.2
110.0
2011 2012 2013 2014 2015 2016 2017
#2 in Facebook
active users
(76mln) only
after US
#2 in Twitter
users (41mln)
only after US
2nd largest
market
outside US
40
38
32
31
25
17
13
11
3
India
Brazil
Mexico
Germany
Spain
UK
Argentina
Russia
France
28% of mobile
users in Brazil use
Instant Messaging
apps
Source: SocialBakers, e-Marketer, Semiocast, G1.com, Folha de São Paulo
MACRO & INDUSTRY OVERVIEW 7
465 mln
worldwide users
List of selected
countries as of
Feb/14
8. 53% 64%
79%
90%
2006 2007 2008 2009
4%
12%11%
52%
2011 2014
Tablet
Smartphone
56%
48% 42%
34% 27% 27% 23%
• Incoming calls
only device
Mobile Penetration
(% over population)
DATA GROWTH IS THE NEW CHALLENGE
Data Penetration
(% of data over total revenues in 3Q13)
248
212
166 162 140 139
91
MOU in 2008
(minutes)
• Still a lot of phones
without data access
• Wi-Fi only devices
PCs, Notebooks,
Feature Phones
MACRO & INDUSTRY OVERVIEW 8
...was similar to the challenge
in data growth now
Challenge in voice growth in 2009…
Goal: increase voice usage
Challenge: deliver the best
experience in mobile internet
Source: Anatel and IBGE
Source: Global Matrix
High Growth
“Fear” to use
Low Usage
Handset Sales Share
2006 2007 2008 2009
2011 2014
Source: IDC
10. 3Q13 3Q14
+6%
3rd QUARTER IN FEW: RESULTS OVERVIEW
Financial Highlights
Operational Highlights
Business generated revenues
at a good pace
1
Net Mobile
Revenues
(ex-incoming)
3Q13 3Q14
+5%
EBITDA at a solid performance2
EBITDA
reached
R$1,332 mln
in Q3
1 New offers
2 Bad debt under control
Bad debt as % of
gross revenues
Increasing data penetration3
% of data users
over total base
4 Strong performance in 4G market share
4G
Market Share
0.7%
0.6%
1.1% 1.1%
0.8%
3Q13 4Q13 1Q14 2Q14 3Q14
-22.3% -21.9% -22.9% -20.5%
-2.9%
3Q13 4Q13 1Q14 2Q14 3Q14
Improving fixed business (fixed business net revenues Δ% YoY)5
+19 p.p.
Strong cost control (total opex Δ% YoY)4
8.8%
2.3%
-2.9%
-7.2% -8.1%
3Q13 4Q13 1Q14 2Q14 3Q14
33%
39%
43%
3Q13 2Q14 3Q14
Net Income3
Net Income
totaled
R$348 mln
in Q3
3Q13 3Q14
+11%
+6.4%
+10 p.p.
Source: Anatel
26%
30%
Jul/13 Jul/14
+4 p.p.
3Q RESULTS 10
11. 1,283
1,378
3Q13 3Q14
Service EBITDA (ex-handset business)
(R$ mln; %YoY)
BUSINESS FUNDAMENTALS
Core Business Evolution…
…Overcoming Challenges
Mobile Service Net Revenues
(% YoY)
Service EBITDA Margin
(ex-handset business)
(% YoY)
(Local + LD
+ VAS
+ Others)
Business
Received
3Q13 3Q14
Business
Generated
1 MTR cut impact on revenues
(YoY performance)
(Incoming
Voice + SMS)
+7.4%
30%
34%
3Q13 3Q14
+3.6 p.p.
2 SMS Outgoing Revenues
(YoY performance)
-18%
-28% -27%
1Q14 2Q14 3Q14
Net revenues
from MTR
3 Macro Environment
Brazilian GDP
Growth (%YoY)
Source: IBGE; CNC
Indebted Households
(% of total)
1S13 1S14
2.7%
0.5%
A market trend
Greater potential for data growth usage
1.2%
-8.2%
-19.4%
1Q14 2Q14 3Q14
+5%
-34%
Operating
margin
improvement
61%
63%
3Q13 3Q141H141H13
3Q RESULTS 11
12. DRIVEN BY INNOVATION
Customer Base
(mln users)
PREPAID MOBILE ACCOUNT/ MONEY
o Partnership: TIM, Mastercard and Caixa
Econômica Federal
o Focus on unbanked population ( >50% of
prepaid base)
NEW MUSIC PLATFORM
o Partnership TIM and Deezer (top global streaming
platform)
o More than 35 million music available for download
o Maintaining leadership position in the mobile
music industry in Brazil
Source: ANATEL
3G Market Share
(%; mln users)
4G Market Share
(%; thd users)
Source: ANATEL Source: ANATEL
INTERNET SHARING PLANS
o Up to 4 devices
o No additional charges
WEEKLY SERVICE PACKAGE
o Voice + Data + SMS
o R$ 7 per week
NEW M2M PLANS
o New data packages
launched for M2M
services
R$ 0.75 DAILY OFFER
o Expansion to new
regions: PR, SC, MA, RJ
o Covering most of the
country
Adding Value Through Innovation
NEW APP FOR
LANGUAGE COURSES
o Games and quizzes help
students developing
English skills
blah COMMUNICATION APP
o Integrated communication
(VOIP, IM, SMS) App
o First ad campaign
3Q RESULTS 12
44%
39%
29% 29%
15%
21%
12%
10%
23%
25%
25% 26%
39%
34%
12%
14%
76.8 76.6
79.8
69.4
72.9
74.9
63.4
67.4
69.6
48.4
50.0
51.4
3Q12 3Q13
TIM
3Q14
P1
P3
P4
Aug/13 Aug/14
31.4
32.7
44.0
18.2
128 mln
Aug/13 Aug/14
TIM
1,605
1,219
857
411
4.2 mln
TIM
13. 67%
77%
3Q13 3Q14
3Q13 3Q14Jul - Aug/13 Jul - Aug/14
24
32
3Q13 3Q14
MAINTAINING STRONG DATA PACE
Data Adoption
Increasing Data Penetration
Smartphone Penetration Over
Customer Base
(%; ∆ YoY)
Smartphones Share over
New Sales
(%; ∆ YoY)
Data Users
(mln users; % YoY)
+32%
BOU: Bytes of Use
(megabytes)
Days of Use
+40%
+22%
43 mln to go!
28 mln untapped
market
15 mln with
data handset
Data Opportunity over Customer Base
32 mln data users
1Q14 2Q14 3Q14
25% 27% 29%
% over total gross
mobile service
revenues
Mix of Data Gross Revenues
(R$ mln; %YoY)
SMS
Web
1,500
+29% +39%
+45% +80%
∆ %YoY growth
1,578
Content
& Others
1,677
+33%
+72%
74.7 mln customer base
+23%+20% +22%
+10 p.p.
New
Data
World
Usage
Increase
Penetration
Increase
25%
44%
3Q13 3Q14
+20 p.p.
3Q RESULTS 13
14. 3Q13 3Q14
~0.7% ~0.8%
3Q13 3Q14
4,045
180
Thousands
4,207 4,045
+149
Thousands
+0.4%
FINANCIAL RESULTS ANALYSIS (1/2)Service Net Revenues
(R$ mln; % YoY)
Reported
Revenue
3Q13
Reported
Revenue
3Q14
MTR
Impact
-3.8%
4,225
‘Pro forma’
Revenue in 3Q14
-306
-4.5
ΔYoY +4.7% -34.5% -2.9%
Δ OthersΔ Business
Incoming
Δ Business
Generated
Ex-MTR
1,332
109
Thousands
EBITDA
(R$ mln; % YoY)
1,252
Reported
EBITDA
3Q13
Reported
EBITDA
3Q14
+151 -71
Δ Opex/
Others
Traffic/Data
Δ Contribution
Margin
24.6%
30.5%
1,332
27.4%
34.1%
EBITDA Margin
Service EBITDA Margin
+4.5% +3.4%
MTR
Impact
+15.1%
+6.4%
1,441
‘Pro forma’
EBITDA in 3Q14
ΔYoY
Ex-MTR
Efficient Cost Control
Interconnection Cost
(Δ% YoY)
Leased Lines Cost
(Δ% YoY)
Bad Debt/Sales
(% over gross revenues)
stable
3Q13 3Q14
-36.2%
3Q13 3Q14
-1.8%
Mobile First Margin Analysis
(% YoY)
+6 p.p.
Strong first margin
expansion showing core
business improvement
Margin expansion driven by
data and VAS (content &
others)
3Q RESULTS 14
17. INFRASTRUCTURE (R)EVOLUTION (1/3)
2016
MASSIVE LD
BACKBONE
65,000 KM OF FIBER
2013
FIBER TO THE
AMAZON
46,000 KM OF FIBER
BY YE13
Fiber to the site / Mobile Broadband
Project Key to Data Growth
Targeting 38 cities in 2013,+100 cities till 2016.
From 2-8 to +100 Mbps.
LTE Ready.
Macro coverage fine tuning.
Focus on IP infrastructure, caching, peering.
INTELIG 15,000KM
2009
INTELIG
ACQUISITION
New backbone routes- Increasing resilience.
82% urban
population
2013 2014 2015 2016
95% urban
population
#NodeB / eNodeB
(3G + 4G)
# BTS
(2G)
2012 2013 2014e 2015e 2016e
New Sites
Including
Small Cell.
POP MW
POP MW POP MW
POP MW
BSC-RNC Site
POP MW
2013 2014 2015 2016
LTE 3G 2G
Fiber base Infrastructure
Backhauling Evolution
Increased Coverage and Access Capacity
(# new elements)
Capex Evolution Towards Data
(% of total Capex)
Small Cell Approach
(# new elements)
NETWORK EVOLUTION 17
18. 39
81
2013
1Q14
2Q14
3Q14
900 Mhz rollout according to plan
(above 600 sites using the new frequency)
Expanding backhauling
INFRASTRUCTURE (R)EVOLUTION (2/3)
Mobile Broadband Update
Cities Covered with MBB project
% of urban
population covered
Quick incident resolution: from 56% to 76% within 8h
Reacting faster to network problems - faults opened
within the target time: from 85% to 94%
Network Hiring + Insource Project
Innovative Coverage Expansion Improving Quality and 4G Services (e.g.: SP)
Reduction in dropped call rates and better
overall performance
Higher average throughput rates
Improvement in indoor coverage
Increase in data and voice traffics
Expanding # of people in
the Network team
From third party TO
insource Network Control
Center
30%
31%
32%
Source: ANATEL app
36%
Investing Efficiently
Big Data analysis for capex allocation;
Antenna level return analyses (IRR and
payback)
99.0%
97.95%
97.53%
98.36%
Voice Access # Antennas
NETWORK EVOLUTION 18
Small cells in gas stations: agreement with
a tower company to install more than 150
small cells inside Totem
BioSite: sustainable coverage, bringing
harmony between environment and
technology
After
Before
19. 3,153
3,106 3,085
3,055
TIM P2 P3 P1
INFRASTRUCTURE (R)EVOLUTION (3/3)
Network in Numbers
4G Sites in state capitals
Ran Sharing
Smart Approach
Source: ANATEL
Number of WIFI & Small Cells
Source: Company
714
1,105
4Q13 1Q14 2Q14 3Q14
Number of 3G Sites
9.3% growth in 9M
Coverage: 79.1% of
urban population
Source: Company
9,074
9,920
4Q13 1Q14 2Q14 3Q14
NETWORK EVOLUTION 19
3,871
3,386
2,983
2,836
2013201220112010
19% 17% 20%
% over sales
18%
Copper
(2-8Mbps)
Before FTTS After FTTS
Metro Ring
From Copper
To Fiber based
Fiber to the site expansion to ~100 cities
CAPEX Analysis
CAGR
11%
2G
3G
4G
R$2,983 ~R$3,800
2G
3G
Capex per Technology
(R$ mln)
2011 2014e
Capex Evolution
(R$ mln)
21. AMBIENTE REGULATÓRIO
Apr/14 Jun/14 Jul/14
Internet Civil
Mark
Endorsed in April.
Presidential Decree has
not been scheduled
May/14
M2M Fistel
Reduction
Regulated in May:
• TFI*: reduction from
R$26.83 to R$5.68
• TFF*: reduction from
R$13.40 to R$1.89
Cost Model
Cost model that complements the
PGMC was approved, extending MTR
reduction schedule to 2019
MTR market average (R$/min)
0.36
0.32
0.24
0.16
0.10
0.06
0.03 0.02
2012 2013 2014 2015 2016 2017 2018 2019
Source: Anatel
Anatel´s Quality
Plan
2 years period of
evaluation completed.
Waiting for final
evaluation.
Anatel’s new rules:
• Automatic cancellation by remote customer
service channels (URA)
• Call back in case of calling interruption
• Minimum validity period of prepaid credit: 30 days
• Offers validity for gross and base
• Provide summary of offers
• Billing contestation valid for 3 years
Anatel’s RGC
(consumer law regulation)
Sep/14
700MHz Auction
Held in 09/30/14
TIM won Block 2
(10+10) MHz, with
national coverage
2014
*TFI - Installation inspection fee (charged per access when the service is activated)
TFF - Operation inspection fee (annually charged per access)
New Parameters
for Leased Lines
• Leased line (EILD) reference
price reduction, in 2016, from
~20% until ~80%
• Established regulated reference
prices to leased lines speed up
to 34 Mbps
REGULATORY ENVIRONMENT
REGULATORY UPDATE 21
22. REGULATORY UPDATE (1/2)
REGULATORY UPDATE 22
700MHz Auction Results
TOTAL AMOUNT
o Auction totaled R$5.85 billion, 24% lower then
the R$7.7 billion expected for minimum prices
for all blocks
FINAL PRICE
o The EAD Contribution of R$890.1 million related to unsold
blocks will be distributed proportionately among the sold
blocks and will be discounted of the Public Price
Block 1 Block 2 Block 3 Block 5 Block 4 Block 6
(10+10) MHz (10+10) MHz (10+10 MHz) (10+10) MHz (10+10) MHz (10+10) MHz
In R$ Million
Minimum Price 1,928 1,928 1,928 30 1,893 5 7,712
Winning Bid 1,947 1,947 1,928 30
Unsold
(1st + 2nd rounds)
Unsold
(1st + 2nd rounds)
5,852
Premium 1.00% 0.99% 0.00% 0.02% - - -
EAD 903.93 903.93 903.93 13.86 887.59 2.48 3,616
Total
National Regional
1st Round
(10+10) MHz cap
5800 Mhz
2100 Mhz
850 Mhz
700 Mhz
< 700 Mhz
0 2 4 6 8 10
Number of BTS
20 15 10 7 5 2
BTS Range (km)
0.52 0.78 0.83 1.07 1.13 1.18 1.22 1.28 1.29 1.29 1.48
2.58
DEN NZL Spain Brazil GER PORT EUA Taiwan Italy France AUS Canada
Average = 1.22
AUCTION PLAYERS
o Oi and Sercomtel did not
participate in the auction
Spectrum acquisition at fair price;
(Price in USD/MHz/Pop. adjusted for GDP)
Better Coverage
(Indoor and Rural)
23. 3rd week
• Return of
the MHz
Bond
Estimated 700 MHz Auction Roadmap
Aug/6
• TCU’s
precautionary
measure
preventing
the auction
rules
publication
Jul/17
• Approval of
auction terms and
interference rules
• Definition of
Analog TV switch-
off dates
Aug/21
• Auction publication
Aug/16
• ANATEL’s
auction
rules
revision
2nd week
• Authorization
extracts published
in DOU
Oct/16
• Counterarguments
by TIM
4th week
• EAD constitution
4th week
• GIRED institution
(One TIM representative)
4th week
• EAD’s 1st 30%
payment
July/14
Set/12
• Clarification
from ANATEL
• Bid bond issuing
Sep/1
• Clarifications
request
• Administrativ
e Appeal
Aug/20
• TCU
approval
Oct/13
• Nor TV’s
appeal
(MMDS
operator)
against CEL
3rd week
• Call for
Authorization
signature
4th week
• Performance
Bond (EAD)
issuing
Oct/7
• Auction Special
Commission;
Classification
and Award
decision
published in
D.O.U.
4th week
• Proof of good
standing
documentation filing
• GO/NO GO Decision:
Additional
Commitments
… March/15 April/15
Sep/30
• Auction
Sep/23
• Documentation
• Bid bond; and
• First bid filing
September/14 October/14 December/14
REGULATORY UPDATE (2/2)
August/14
REGULATORY UPDATE 23
2nd week
• ANATEL’s
Board
Award
approval
1st week
• Authorization
signature
• Public Price
payment
November/14
25. 3Q13 4Q13 1Q14 2Q14 3Q14
TIM SOLUÇÕES CORPORATIVAS: BUSINESS REBOUND
Turnaround on fixed business in place
20132012
-
2014
+
EBITDA-CAPEXNet Revenues (with intercompany)
2013 2014
1Q14 2Q14
o New business unit
organization
o IT renewal plan
o Multiservice
network launch
o New branding
o New offers and
product launch
o Restructured sales
force
4Q14
o Sales and customer
service improvement
3Q14
Financial Performance
o Sales multi-channel
Improvement
o New offers and
product launch
o MTR reduction
Revenues from New Sales
(R$; YoY)
Revenue reboundSales growthMarket repositioning
Infrastructure
reinforcement
Governance / EfficiencyBusiness Priorities: Business development Quality and Process
+5x
Organization
restructuring
Dedicated B.U. to all
business customer
Fixed + mobile
integration
FIXED BUSINESS 25
26. 36.7
38.2
3Q13 3Q1421
13
3Q13 3Q14
Accelerating Operational Performance…
LIVE TIM: SPEEDING UP GROWTH
43
120
3Q13 3Q14
Customer Base
(000 users)
Source: Anatel
881
1,366
3Q13 3Q14
Netflix Broadband Ranking
(average streaming speed representation)
3Q13 3Q14
ARPU
(R$; YoY%)
… with Support of Quality Experience
Addressable Households
(000 HH)
Source: Company
+2.8x+55%
+32%
New Line Payback
(months)
-38%
Gross Adds
(000 users)
18
31
3Q13 3Q14
+74%
Live TIM Net Adds Share
(% of SP and RJ market additions)
Average Speed of New Sales
(mbps)
+4.1%
16%
31%
Aug/13 Aug/14
Source: Company
FIXED BUSINESS 26
28. CONCLUSION
Q3 Conclusions: A good balance between objectives
Perspectives: Moving the plan forward
Strategic… Financial…Operational…
EBITDA
Net Income
+6.4% YoY
+5% YoY
+11% YoY
MBB in 81 cities
OPEX Control
Prepaid leadership
Infrastructure growth
Evolving revenue profile Renewed Mission/
Purpose/Values
New 3-year plan
“To connect and take care
of every customer, so
everyone can do more”
o Industry leadership
o Long term commitment
o 4G license 700MHz
o Tower sale supporting
investment plan
Quality
Business
Generated
TIM Protagonist
• VOICE
• SMS
• MTR
• DATA
• DIGITAL
SERVICES
o Data and digital
services leadership
o Infrastructure
o Customer base value
o Customer experience
o One TIM initiative
Data Users
(mln users)
Data + VAS
(ex-SMS)
Smartphones
(over total base)
32 mln
32% YoY
44%
+19 p.p. YoY
R$1.3 billion
+49% YoY
BUSINESS OUTLOOK 28
29. 21.3
27.5
2012 2013 2016e 2012 2013 2016e
+xx%
OFFER EVOLUTION
136
148
>170
2012 2013 2016e
18%
21%
>40%
VAS
Gross
Revs.
VAS/Revs.30% 37% >50%
43%
55%
>75%
2012 2013 2016
+xx%
+29%
+22%
Smart/Web phone Penetration
(% over total base of lines)
Voice MOU
(minutes)
Data Users
(% of Data Users in CB; million users)
VAS Revenue Growth
(% of Mobile Services Gross Revenues; R$ mln)
BUSINESS OUTLOOK 29
2012 2013 2016e 2012 2013 2016e
30. TIM PART: 2014-2016 GUIDANCE
Total Net Revenues
EBITDA
CAPEX
18,764
19,921
2012 2013 2014e 2015e 2016e
5,012
5,207
2012 2013 2014e 2015e 2016e
R$ million
R$ million
626
3,139
3,871
3,487
384
2012 2013 2014e 2015e 2016e
R$ million
Infrastructure
Others/Licenses
3,765
Guidance
2013-2016 CAGR:
Mid Single Digit Growth
2013-2016 CAGR:
Mid Single Digit Growth
Total CAPEX 2014-2016:
~R$11 billion*
*Does not consider 4G licenses (700Mhz).
BUSINESS OUTLOOK 30
35. HISTORICAL DATA: OPERATIONAL & FINANCIAL RATIOS
ROA: NOPLAT/Avg. Total Assets.
Calculation considers organic Net Income and EBITDA
HISTORICAL DATA & OTHERS 35
37. Investor Relations Team
Avenida das Américas, 3434 - Bloco 01
6° andar – Barra da Tijuca
22640-102 Rio de Janeiro, RJ
E-mail: ri@timbrasil.com.br
Rogério Tostes
E-mail: rtostes@timbrasil.com.br
Phone: +55 21 4109-3742
Vicente Ferreira
E-mail: vdferreira@timbrasil.com.br
Phone: +55 21 4109-3360
Leonardo Wanderley
E-mail: lwanderley@timbrasil.com.br
Phone: +55 21 4109-4017
Rodrigo Godoy
E-mail: rcgodoy@timbrasil.com.br
Phone: +55 21 4109-3446
Luiza Chaves
E-mail: luchaves@timbrasil.com.br
Phone: +55 21 4109-3751
Visit our Website
www.tim.com.br/ir
Safe Harbor Statements
Statements in this presentation, as well as oral
statements made by the management of TIM
Participações S.A. (the “Company”, or “TIM”), that are
not historical fact constitute “forward looking
statements” that involve factors that could cause the
actual results of the Company to differ materially from
historical results or from any results expressed or
implied by such forward looking statements. The
Company cautions users of this presentation not to
place undue reliance on forward looking statements,
which may be based on assumptions and anticipated
events that do not materialize.
SAFE HARBOR AND IR CONTACTS
SAFE HARBOR & IR CONTACT 37
39. MACRO SCENARIO OUTLOOK (1/2)
• Market consensus shows a
softer growth in GDP.
• Consensus expects a
deterioration in overall
macroeconomic scenario on
the medium term.
• Market expects that the
government is unlikely
pushing inflation towards
the center of the target.
• With inflation and FX Rate
going up, SELIC is expected
to grow, specially after the
recent decision to rise the
rate to 11.25% p.y.
GDP Forecast
(% YoY Growth)
Inflation Forecast
(IPCA: 12 months)
Interest Rate Forecast FX Rate Forecast
(R$/U$ - year average)(% Selic Target p.y. – year average)
Source: Central Bank/Bloomberg
5.9
6.3 6.3
5.9
4.5
2013a 2014e 2015e 2016e
10.0
11.0
11.5
12.3
2013a 2014e 2015e 2016e
2.2
2.4
2.5
2.4
2013a 2014e 2015e 2016e
2.3
0.3
1.2
2.3
0.7
3.0
4.0
2013a 2014e 2015e 2016e
Government’s
Target
Government projection
Market Consensus
Government projection
Market Consensus
APPENDIX 39
40. MACRO SCENARIO OUTLOOK (2/2)
• Market expects the
unemployment rate to
increase in 2015, as jobs
creation remains low.
• Even with a high number of
indebted families, families
in default figure has been
decreasing, probably guided
by the constant reduction of
unemployment and real
income gains, specially on
classes C and D.
Unemployment
(%)
Formal Jobs Creation*
(In Thousand)
Indebted Households* Families on Default
(% of total)(% of total)
Source: Central Bank/Bloomberg
61.6 58.9 61.4
63.2
3Q11 3Q12 3Q13 3Q14
-307
303
189
237
4Q13 1Q14 2Q14 3Q14
24.3
19.1
20.6
19.1
3Q11 3Q12 3Q13 3Q14
6.0
5.4 5.4
4.9 5.0
5.6
6.1
3Q11 3Q12 3Q13 3Q14 2014e 2015e 2016e
* Families that declared to have debts on the categories of:
credit card, stores bills, personal loans, car loans and insurance
and postdated check
* Families that declared to have debts overdue for more than three
months
*Number of job positions with the complete registration
of the employee
APPENDIX 40
