Q1 2022 Tim SA Earnings Call & Brazil Day

I'm really happy to be here and I'm back to my place.

So this event with the results we're going to present today and this thing day doing this in a hybrid way and we have onsite people here.

Hi.

The first lines is concerning our results were have we've had a first quarter of 2022, there was really solid.

Afterwards, we're going to elaborate in a longer term vision.

We've had a growth of service revenue.

8.4, that's a record high we've got an <unk> growth of five 1%, but here we need to.

Clarify something in the first quarter of this year.

We've had a business model that was different from last year.

Those who follow us know.

That is the end of last year.

We've had carve out.

With a cost.

More cost on the empty land.

If we see.

See this 5.1 comparing to last year.

Without the outsourcing of the Liza 5.1 would be eight eight.

We have another growth.

Quarter in pre and postpaid <unk>.

<unk> had several brands and operational issues that are very important we've had the full implementation of the five G.

And we've had our six six which is our bank partner, we've launched a unique partnership with Apple.

Water.

That will be extended.

In the next months with more novelties.

Those airport Airport chose Tim Brazil for this partnership and for the first time.

We've had.

To assist in ability yearbook from the S&P global.

And we've.

The old deal closing in April .

Yes.

No.

More details.

We've had this.

Income.

Revenue growth we've had.

Growth of eight 2% in the mobile board.

In broadband.

And in the new revenues that doubled from one quarter to the other.

And more details in terms of dynamics.

And values volume to value segments.

When we see the.

The image on the right.

See that our revenue is growing eight 2%.

Eight 9% sorry.

And.

We can say it.

Put simply because we said importantly demonstrated we're talking about 3%.

We've had it.

Instead of me into the outgrowing because it means that our customer base.

Sir what is the double doors.

All of that.

So from last year.

At that moment and we've had.

Record lung churn rate.

And now we've had a new record in churn greatly in order.

We've had the.

Lowest churns in Tim Brazil had.

We're going to have.

Worse numbers next quarter because in March.

In May we have implemented the.

The new strategist of adjustment strategies.

Typically.

These changes the churn.

Implement as it's implemented.

Yeah.

<unk>.

Really it makes me proud is the prepaid resolved.

Those who follow.

Well, we've had this prepaid revenue for a long time, and we've had positive incremental sales in the first quarter of last year.

But we've had.

Shut down from pandemic, some 2020 and in postpaid.

Segment, we've had we've currently recharges by.

By one 8% and spending by one 1%.

That revenue comes from the recharges and spending.

In Aberdeen.

In April .

The trend is confirmed it maybe too early to call.

At year end.

What determines.

Had several sectors.

We've got the rest of the <unk>.

Now we don't have the restrictions of the pandemic.

People have more mobility using mobile.

Also we've had.

Hey.

Australia, Brazil, which is a.

Subsidy for people on low income people here in Brazil.

We've had.

Promotional also marketing as well.

So we've had this innovative initiatives.

Which is T plus cities that the sales, which is the Uber as a nation of.

B of Sim card sales.

So my first results of the campaigns are very positive.

From.

The point of view of business we've.

We've had to lie team live results our broadband.

Okay.

As I said in the beginning we've had a partnership with the system.

From the end of last year as every partnership there at the moment.

Adaptation.

And now we have the system.

With the rollout acceleration.

We've launched.

Joins Hill.

With la.

<unk> launched the new classes, so it's going to be a growth leverage now mixing and now our base mix.

Is that more focused in F F F Dth.

You know that FTC E E.

Older technology.

We had some competitive dynamics.

Because at DTC in our mix.

So we have now a positive issues and also with <unk>.

One of the best Broadband Service Award.

So we have a commitment with quality that has come out now.

I'd like to call come in to talk a little bit about the financial results.

Yeah.

Yes.

Thank you Alberto good morning, everyone. Good morning for those who are watching us online our tried too.

Control My Mic thing because you know that the CFO is like numbers, they don't like Presentation's, but.

Looking at our results when we took at the lower left hand side, we see the reduction of our costs. We have to remind is that like Alberto mentioned at the beginning that we had a little rich.

Reducing our margin and we started with the ice systems.

That impact Opex. So it leads our costs for the quarter to increase 12, 1% in relation to the first quarter last year.

But when we use the same parameter when expert I system cost.

Cost growth is aligned with our revenue growth and this leads our EBITDA margin.

To have dropped a little we had a five point to one growth of EBITDA with a little decrease in margin, but when we talk about parameter we have an EBITDA margin aligned with the first quarter and the growth aligned with our revenue and about eight point to 8%. So it's quite an.

An interesting growth in our EBITDA.

The counterpart of this extra cost line is where we look at the right hand side of our slides and we'll look at the bottom.

When we saw when we see cash generation EBITDA minus Capex Capex, we see a growth of our EBITDA margin of about 16% in the first quarter, 21% to 60 point age for <unk> 'twenty two reminding you that this year, we started off first.

You.

With a as ESG growth, even having the <unk> deployment, which is.

In packaging our cash generation.

With your assistant movement.

Looking into our leverage cash leverage you know that our company was getting.

Had been preparing itself there are balanced for two important events after 'twenty, two which was.

Acquiring <unk> and that led us to a cash position of over 10.

In our first quarter, we had some important tenders embarrassment. So we had <unk>.

Lottery fee payments.

We also had a five G licensing payment.

We ended the quarter with a.

<unk> B, which is quite a robust cash position now.

Now in April as you know we had today.

OE reimbursed so for mobile assets with $6 3 million does embarrassment in our second quarter, we have another share of Aif.

Yes.

Of age.

Point.

Five four <unk> auction.

And we had the payments over on capital use.

Five three.

Thanks Neil.

We have almost 700.

<unk> retained comprised by oil for semi just cement.

We may have to reimburse and 120 days, but despite all those.

Numbers, we ended our leverage at all points 63 over our ending the.

Year on year.

And.

We have.

Sure.

Position of minus one 7% of the company, which is quite positive.

Thank you Kimberly.

Thanks to the whole leadership team who are here.

So we're going to have another quarter of.

Solid delivery of.

The deliveries.

First of all before showing the plan I'd like to.

You play a video it's an institutional video that we launched last year last week.

And it's part of our positioning pillar.

We have.

DNA Association that is very strong it represents.

Yeah.

Very strongly.

Positions of our brand as the values of our brand.

To connect our brands to people.

Watching.

Video again after he was long.

I thought that the images of the video and music described very well.

Period.

What we have.

The next generation.

And our directors.

Additional regulatory directors.

Good evening.

Decided to call as our next generation theme.

[noise].

Uh huh.

Okay.

I believe you said no.

Got it.

But I view that amusing to doing.

Yeah.

Tim is an official sponsor of rock in Rio 2022.

And so.

So.

This film.

The introduction to our second phase of the presentation.

<unk> is a.

Next generation PE.

In terms of commercial strategy.

Yes.

Brand engagement.

We have with the rock in Rio.

Festival, which is the greatest.

Got it.

Got it.

It's a.

One of the greatest festivals in the World and next week, we're going to have one of the great free festivals, that's going to happen next week.

Hum.

And we're going to have the consequence of several stages that happened in previous years and that the next transformation stage.

In Brazil.

It will happen and I'm going to.

Tell you a few of this a steep steps.

The last years, we've consolidated our positioning in terms of leadership and innovation.

And what we called.

The volume to value strategy.

We were foreigners and introducing this and working towards that.

It's the inorganic operations that happened in the market I'm talking about.

Okay.

Neutral network.

Third highlight is the launch of the customer platform.

Yes.

Three huge choppiness, we have also the five G. But these three.

A huge component allows.

To have the ambition.

Yeah.

Hum.

Consumers' point of view it allows us to provide the best combination of offer and service to Brazilian consumers and when we talk about.

The financial community.

The mix of volume to value is something unique because we're going to grow above market.

The marketplace and we'll see we have a leadership in the.

Revenue.

We're going to being leaders, we're going to expand our profitability and this will allow us to have some room.

Some.

Policies also we have the ESG is.

<unk> done is executed as integral part of our plan we have some recap a few recap.

Our work.

So we are the company with the greatest profitability in Latin America.

Alright.

Operation revenues.

So one of them.

Companies with the greatest value of Latin America, So we're going to expand even more of this numbers in the next two years.

This will allow us to grow.

The what our stake holders receive.

Okay.

Second element.

Boy Operation this operation as we see.

We have two great winners the oil clients.

And Tim Brazil.

Why do I say this.

Because of the structural point of view, we get a lot from this operation from the commercial point of view.

Clearly.

We have a broad or.

Market, but we're getting from our clients in two different areas that are strategic for us So Paulo and Rio.

So is this a boost of the plan that we were already executing and now also will have our commercial footprint in.

Different areas, such as Rio Grande do Sul State and.

Also we will also have a critical mass and with critical mass we can invest to grow in a simpler way that we do today on the other hand.

You see on the right of the slide.

We have the infrastructure.

We are.

Grid is mobile coverage in Brazil, right now from the point of view of covered cities and population.

Before it was only unfortunately noticed in general and also we have the number one and spectrum per client.

We're going to integrate this in it allows us.

True heavy capex more efficient and also scale up the service level.

So there is a strategic advantage for Tim there is really high.

This is reflected in the synergy numbers that we've.

Launched last year, so I'm going to talk a lot about this we're talking about.

So about 4 billion Reals rails.

With about nine to 12, so we have this commercial synergy.

We have about this net value creation of 16 to 19 billion.

Yeah.

Okay.

So.

It's.

This is deep transformational issue for us.

Having said that.

Okay.

Yes.

That's where it comes out.

Value.

Proposition.

Debt.

Provides growth of the top line I'm going to talk about top line growth and afterwards, so I'm going to talk about value.

Generation.

But here, we have two messages one we're going to grow above market place.

<unk>.

We have a.

We're really anchored in our core business and we have a head start.

Our.

New revenue generation.

We are partners, we launched this last years also.

We're talking about people.

Mobile award.

We have the ambition to become the best mobile.

Carrier in Brazil.

And in a market that is a mature market.

What does that mean it means the best offer best quality or service for the client.

And the best at that.

In terms of efficiency, so we're going to grow 1.5.

<unk> in the next year is when we see the broadband it's different because it's it's.

The market is growing.

And we have we will have 10 million clients more in the next six years, so we're going to double our size.

And asset life modality.

Yes.

And this.

Partnership with ice system will allow us allows us you'll see soon that I system will be an accelerator.

And we're going to show this.

Got it.

Yes.

On the right side, we can see.

The area that has a nix financial growth play.

We have <unk> Iot.

Which is fine.

<unk> she is something real now.

Yeah.

Keyword is too.

To win.

We need to get some verticals to get clients to develop a platform a new platform in the future I'm going to we're going to talk about this in the future as well also we have the customer consumer.

Consumer platform.

And Ronaldo is going to talk about this.

And we've got.

From the start.

<unk> and customer lifetime value in core business work.

Yeah.

So here.

We're going to grow above market. So we have a good future growth mix.

Going ahead in terms of value.

Value growth.

I've talked about growth now.

We're talking about double digit growth in the long term.

Don King about front, we're going from mid single digit to high single digit.

We have profitability I've showed that we are leaders in profitability in Latin America, we have a strong positioning this is something that is in our DNA we're facing.

Couple of challenging years, because of inflation that impacts some of our cost categories, having said that we have a solid plan in terms of digitalization simplification.

Delaying that too.

<unk>.

To defend our.

On one side and we have two powerful leverage is that Oh boy and <unk> and we're going to talk about this more ahead.

And we have an improvement on capex and surfaces.

Having said that we have with the.

What we're going to do we're going to review.

Our situation for our stake holders, because it's going to improve for them and it's going to <unk> to change this in 2022.

Cumulus is going to talk about this later on.

Because we want to keep you hooked until then.

When we talk about ESG agenda.

This is embedded in our.

Business strategy.

Goodbye.

And then we have a huge achievement in terms of energy we've had an improvement in constant.

<unk> energy.

We are very proud to because we're number one in the world.

Off and turn on engagement.

That is really high.

So from the point of view of good governance.

We are the first Brazilian carrier.

To get the proactive.

Stamp.

And also a commitment in the U.

E S G agenda fully integrated to improve.

Quality of service for the clients.

So after this.

The message is a growth above market headstart, where step ahead in generating new revenues.

Growth of profitability commitment with our stake holders ESG.

And with the S yesterday.

Hey, Bill.

Hi.

Yes.

Since I am still here in this position I am going to start with all verticals. We are going to talk about mobile we're going to talk about the broad band B to b.

Great.

So when we start mobile our mission.

Is to become the best Brazilian mobile operator, but what does it mean.

As I mentioned, the numbers I'm going to skip through that to the best offer.

Second Best service third best network, thus offer we already.

Have been acknowledged as a leader in this field. So it's two <unk>.

Keep the gap.

When we talk about the best service and quality, we know that all operators. They all work about the same but he had the opportunity we're going to see.

So something is about to widening the gap, you'll want to distance ourselves and we want to lead the Disney Neil competitive love her.

When we talk about network.

Yeah.

Leo.

It says we have several achievements we have an enhancement in our Ford GM and Brazil, we have the best video and video calling experience. We're still gonna jump ahead of that in fact is that in our clients.

Perception. This is still not a reality so we need that we have the challenge of correcting the perception by our consumers.

Here the goal is to close the gap.

We are now moving forward towards each of them and I'll start by offer and then service and then Leo was going to talk about the best network.

When we talk about best offer so just to remind you we were the first one to launch.

Netflix.

In 2019.

We were the first to choose to offer choice bundle and we are still the first one we aligned well.

We were the first to launch the first service quality of service for prepaid.

Sure.

And debate prepaid services, we have launched now at an exclusive partnership with Apple that's going to be developed over the next quarters, we have a lot to our first film.

<unk> coverage now we're gonna also.

The team in the Sky.

Service integrating and also plans integrating pic. So we wanted to have pass that I had before of our.

Competition I wanted to show another video since we are in our mothers day campaign, let's watch it. Please.

So the we have a new team black offer them.

With lots of ancient ads to enjoy the best coverage in Brazil, now with five G.

Yeah.

And on this mother's day and and <unk>.

The discount on your sub Galaxy S. One to anyone.

No.

Yes.

And now.

This news.

Samsung version, we have a partnership with Apple.

So now.

We had talked about twice bundle on I'm music with us.

The best I have fallen by Apple right now I've found 12.

So we are working our perception from a consumer's perspective, we're talking about best surface now that service is an area that we have been working for quite some time now in several.

Lines and in all areas of the company, we have a digitalization area digital interactions.

We have more than 80% interaction with the company that work digitally.

We are introducing and we are evolving our caring.

Models through.

Hi, Hey, Alex will talk about it and then you carrying model.

The IP culture is fast tracking 14 black customers.

And we are with visiting the journey of the client.

Clients journeys to improve our NPS, we have had over twice as.

Better results in our NPS carrying into years.

So, let's see our satisfaction surveys and us.

Green, we have been first for the past 13 months.

The most coherent indicators that we have is the heck, let mackie our valuation we have the ambition of <unk>.

Entering to excellence club.

Or a 1000 and by the end today, we are working on in eight out of 10, great. So we are already in and excellence.

That range, but we want to work until or a 1000, which is the top notch.

Thank you Alberto good morning, everyone good to see some faces.

After two years first of all it was a bit fearful because there was so much music, where I thought we'd have to have a performance, but the center canceled this idea and they didn't have to come in dancing, let's talk about next generation I want to remind you what was the first quarter of this year.

We're a company that we've always had to deal with historical gaps because basically to spectrum and coverage we were.

Sure.

Carrier, who had a spectrum.

Advantage and you know that spectrum and mobile is really mandatory for efficiency, we've had almost 50% less spectrum than our competitors.

In terms of coverage where.

Ben the only in a few places in Brazil, pronouncement that Katherine Jimenez. The northeast also we had a gap in terms of.

Comprehension.

But how did we overcome these gaps.

Not only competitive but in a few moments we've reached the best carrier in Brazil through innovation.

Vision was always part of teams DNA from a technological point of view. This is something that we all also.

Calculate and we tried to do things differently.

I'm going to remind you of a few cases.

That helped us to overcome that leaves gaps in which we work these things will work.

Accelerates.

Accelerators for the future.

The first thing has to do with the technological Xu.

Sure.

Karen that notice that the three G cycle was getting over and we were going we were entering a fortune side.

Cycle. If you see this graph on the left from 2000, Fourteens and fifteens team decided to invest in <unk>.

This gives us.

The coverage.

Leadership in terms of 14% you saw that the few competitors reacted.

Our leaders are Theres two years later.

We're targeting the middle of the way.

But our focus was on the <unk> and from now until now.

Coverage.

A leading point, reaching 98% of population.

Part of this perception empty for G coverage acceleration has to do with the spectrum re farming.

What we need.

To get the spectrum that was on two and three gene and changes to <unk> trying to.

Use of the equipment in that range.

Also when we think ahead, we talk about innovation criteria that we use.

And we talked.

Talk about the 700 megahertz who've had the 700 megahertz auction in Brazil four years ago, we were the first carrier to use it and we've had a.

Coverage.

That is totally different from the rest of the market we're talking.

About that the urban population covered but also we have the assist ability. We also shows what's the percentage in time.

In which they play it.

This.

In this line.

<unk>.

And we don't not only have the most extensive.

Network in terms of cities, but we also in terms of presence so that the client stays longer in our forged food network.

Also.

<unk> to launch the volt, we were the first at home.

Carrier to launch the bolt and we're the only ones who have voted in scale, we're talking about 4700 <unk>.

When we adopt the vote.

We have a better quality info in terms of voice.

The video and avoiding.

Some kohls dropping.

With vault, we have a reduction of 50% of our call.

Dropping.

This is already this is also part of our customer experience is very important with the five G. The five G standard he doesn't.

On the call.

Community of the cold.

Glenn.

For the three G I want to go.

The only way to.

Voice call and fiber to you when you have no five G is going to he's using the volt. So there.

Area that has evolved especially in the beginning were the <unk> carrier is growing is something that is very very important to something.

To be able to launch voice and five G. Well. The second thing is we've had less spectrum them.

The competition, we needed to be more efficient in terms of capacity.

And quality delivery and we were the first in Brazil to launch Masters mind, its a technology that is.

The <unk> and Mimo.

Five G we decided to.

Use massive mimo in Brazil.

And we've increased four times, our capacity when we compared to the previous.

Version.

We are one of the operators that use massive mimo and the larger scale in Brazil, and we're going to see our next generation concept and you will see that this is a future improve investment.

We also were ensuring quality, but we've had a coverage gap.

And so we've worked a lot in terms of infrastructure.

Let's remind remember biocide Cmos the company.

That created the Biocide design, where we had.

April .

Likely litle, and we think that we put the equipment. They use us buy a site was really paramount to grow in several cities without bringing any kind of visual impact.

Because this boat is.

Mixed.

Mingles with the.

Urbanistically.

Outlook of the cities.

But we'd reached.

Coverage in places that we couldn't imagine so we created the concept of sky coverage, which is Uh huh.

I'll turn on my side.

We can install this with we don't have access to back haul and not even.

Electric power and we use the lithium battery and we can use it as a satellite information and it doesn't demand a lot of committed capacity. They meant a lot of coverage so that satellite.

Backhaul in terms of statistics used just starting to begin.

Being really efficient because we received reduced 80% of the cost that we've had before and this kind of solution.

Now Tim has more than thousands I covered sites and we will intend to reach more than 3000 in the next few years. This is one of the pillars that we've had we have to have leadership in agribusiness to reach in regions, where it wasn't possible to reach before.

Yes.

What I've told you many of the opening.

This team until the fourth quarter of this year whats going to beat them in the next two years.

Thank you to all the time, we were like in the better fraud fighting.

And then to me with the double of mission that we had no it's different with our new assets first.

Terms of spectrum, if we see what we are receiving from <unk> and we've got in the five she auction will know we are the best positioned carrier in terms of spectrum megahertz per client.

The.

Carriers that have the greatest gap no we yeah.

We have the best positioning in terms of growth and you think about.

A lady delivery the second asset that is important from a boy is this hours person.

Sid I mentioned, we're going to the commission about 60% hopefully well with ours.

Going to bring clients to our network with the spectrum and then we will have a more efficient network in terms of costs.

40% of the Star Wars will keep on being active in the executive powers will help us to consolidate the coverage in a few cities in Perth vertical reagents or even in the <unk>.

And also adding to our portfolio.

Portfolios.

New 264 cities, where we were not present in all it was the boys.

The second asset that brings us to this moment is the five G.

We also remember that remind you that the five G auction.

January had a really.

Important work from our team.

And with our partners to show that we needed a different auction, which is balanced investment in infrastructure and payment on the spectrum.

With that we manage to be well Chargers and.

We got a spectrum of 3.2 gigahertz in the with the 100 megahertz of the brand and the National plans also have a spectrum of two three gigahertz and the spill regions and also 26 gigahertz with this auction we've had some coverage obligations, there's obligations will take us until 'twenty two.

Nice to cover all the every city in Brazil above 30000 inhabitants with the five do we have to.

Huge.

Stations in a third one that I'll tell you afterwards first to improve.

Qualities.

Claims experience and the mobile it comes with a less latency and the increase of speed.

The second thing is generating new revenue and services opportunity.

Would you be before Tim couldn't be so present, because we didn't have this fixed capillarity and things you said was about.

If I G changes.

Lately I mean, five G. We work not only to play.

And the same level, but we want to be better so we have.

Several opportunities, where we will overcome in terms of industry in agribusiness and also smart cities, which is the next.

We have launch the Mou partner to work in Curitiba and when you do this in other cities. So so we'll have this opportunity first with five improve.

Improve the client experience and have new revenues and services.

Second has to do with efficiency.

Finally, she has a lot of capacity.

The spectrum brings this capacity we can reduce significantly.

The cost by gigabit.

And we can give for our clients. So it's a lot cheaper to growth all raw traffic in.

Oh.

This demand in faster than in forging so what's interesting now.

Once we have it too.

Great.

Network by coverage, so we have well.

Low use instead of investing for growth I can maximize the use of the <unk> network. It means that we're more efficient in the escape ex allocation here we have three.

Curves that show different possibilities in adopting the five G device by the market because those were going to drive it.

It is the.

Device were not the network, where we see the blue curve, which is the more conservative.

Where we have our plan but.

But we are seeing in ward.

Such as Asia is in the USA.

C.

Greater scale of five G. So it brings us a cost reduction and a speed up of the skirt. So you know part of it was affords you we took four and a half years.

For the for Chi.

Technology to overcome the <unk> technology in terms of traffic volume.

Volume, we believe that it will be smooth.

It will happen unless your time, so if we take it to the.

Yeah.

Hi, Kurt.

We can have more than 2 million.

In terms of efficiency that is not counted in the.

The goal that we had into 2024.

I was talking about our innovation DNA that made US reached at this moment with this even with this huge gap Hawaii.

Team.

He is always an innovative company and I'd like to share a few achievements that we've had in quite a few we were the first carrier in Latin America to launch.

Five G stand alone.

When Anna.

Yes.

It allows us to have the spectrum, we will be able to upload the network. We've had a very interesting stats about.

The activation of new.

<unk> software is to see what was the most capacity we can have myself and we've reached a huge number of 7.1 gigabits per second.

If we are selling <unk>.

5200, Megabits, we can see the dimension of $5 7.1, Gigabits and one less so.

Usually its tower has three yourselves when you're talking about 'twenty, one gigabit per second per tower is.

Really a huge capacity.

It really.

Richard.

Very close to what we have in the <unk>.

Fiber springs.

So back then we had the difference in terms of cycle from <unk> to five <unk> to four <unk>.

Michael <unk>.

Reaching any turning point, probably the traffic from 23 to 24 will be stabilizing in the growth will come from <unk> from.

From the next year.

Onwards, all our efforts will be focused on five G. Unfortunately will be a maintenance technology.

But back there we did the re farming of Fuji.

And <unk>, we're already testing this from <unk> to five <unk>.

Spectra.

Spectrum on massive mimo radios or massive mimo is that we have.

We.

Did this recently at their stuff.

Getting this read your same radio the same spectrum and used it on five G and we've reached a new number between seven to nine.

<unk> done the conditional.

So with innovation, we can have in investments that our future.

This reforming two five G will depend on the curve acceleration the more we accelerate the skirt more opportunities you will have to.

Due to the recent farming and use the investments that we've had on parts <unk> and used it use it on the five G.

This is what gives us a security terms that we're going to deliver the best network in Brazil in terms of your coverage Bill filler.

Albert has said that from 2015 with who we are before she leaders.

No we are leaders.

Final stop or something else.

So.

We can reach.

More than 5000 C D.

Remember that we.

<unk> done a promise of being no cities in Brazil in 2024.

But we intend to do this now.

We have the best.

Video and video calls.

We talk about this because these are real time surfaces.

It's not an issue of giving a good guy.

<unk>. This is important is the ability the video comes in real time no. Good at being just really fast and afterwards, so we need to continue.

Good quality.

We're bringing these two five G and we have the commitment of delivering the best network in Brazil, as well to make it tangible intangible I'd like to call a video.

Yes.

[noise].

Sure.

So.

Also this campaign.

It's I really like it but I didn't know if I told you that it was the greatest of all I campaigns that several success indicators that it has been a very pleasant for our public let's talk a little bit about broadband.

E.

Here, we are talking about accelerating growth in our new asset light model when we talk about to the ice systems ship Chip Sim card.

The market has grown and to your 0.4 by 1.5% then we go to just 3% what are the main leverage levers that we can overcome the next few years here. In fact, we are talking about increasing our footprint. So we have already launched.

The class area here, we are competing here together accelerating the migration off at T. T. C. F. T. H, we are doing lots of brownfield in Rio de Janeiro, and some Paolo.

So that we can convert our clients.

From a to a fiber technology. So we have a reduction turn goal and when we talk about.

And upgrades on our value proposal that it has to do with the synergy.

Between not.

And in mobile and not that correcting bugs to seize more.

Opportunities and using bad Pigging on our brand and someone join really it's an area, where we are leaders in market share. So our strength there we wanna.

Have it as a as an accelerator.

I'm Gonna have Fabricio Bein D here.

Sure.

That's N Sierra is the enhance broadband.

Officer, and before we start asking questions to fabry issue, we're going to have another video.

Yeah.

Yes.

Yes.

[laughter].

[noise].

Okay.

So.

February issue I think that increasing footprint.

It's something that we can do it cannot talk a little bit more about this migration that we are doing from <unk> T H.

Of course Humberto.

Good opportunity on focusing on fiber as you can see market is going to want to go and we went to be simpler and simpler.

And for that visit fundamental we have more than half of our H b.

Market that we can address.

The address to fiber enough to after D. C. We have two thirds of our clients in fiber and we're getting one.

Per cent per month, and more and more we have clients being so then why are migrating them to fiber.

And we have several advantages in the short term and we have a long term.

What is the client churn reduction of a client once it has been migrated.

Okay.

We'd get 30% of these churn all of this gives us a client value that is higher.

We don't need to.

Work with the arch, we have this 30% change in churn it that's interesting and when we go to brown future regional we have a client capture.

And we have a double of clients being captured specially in AR.

Different region.

So here, we have the benefit of a churn reduction and new client capture enough to T. H.

And growth in areas that previously we could enter because fiber was uncompetitive. So fabrizio can also talk a little bit about the synergy.

And this.

Live.

Team lives and livelihoods.

Firstly the claim.

We have to see one important thing we need to work with things like V was a separate company and they join and we're going to have a real joy.

Joining work in terms of all issues, we want to be more team, we want to be more present, a different element and when we talk about mountain more lives we need to bring the complexities that are not small broadband is different from mobile for the we have to bring this for the company.

Since then we need to simplify and integrate them in our value proposition and workforce dynamics.

In terms of results, we have the synergies and we have a lot of opportunity to bring this we are able.

To be successful in Brazil, Uruguay, Unenjoyable easily with this synergy and we have a lot of space.

Terms of channels, we have no we don't even have 3% of the saves in open channels.

Which are.

Our stores and digital process, we can.

Even growth, 20% to 30% in this channel.

And we can do that without adding value to the company.

To the company.

Have a huge brand and we can use their top of mind of several places.

We can use teams brand to get more market and to strengthen the team live in fiber in all of Brazil.

Yeah.

Our clients see the market as a boutique.

Don't need to be this particularly can serve everyone. Because as you said in the beginning we already have the best broadband company in Brazil also we got the kind of Tech award that is specializing in several regions. So the clients see us as the best carrier so in terms of broadband.

So using this grow in terms of footprint we have.

We're reaching with our wood.

The ice systems, and we are specialists in working with no true.

Networking so this metal can be.

Also broadened to other partners and we can triple this we have a growth Avenue that is huge.

As this asset lights are issued that you've talked about.

We can have a business model not on.

No lighter weight, which is different from what our competitors can do in terms of channel.

And commercial aggressiveness, what happens in the marketplace today.

<unk> spent billions to create a network and then billions in discount channels and commissions to occupy this network. So it's money after money what we want to do we want to be too twenty's shape, This lightness and strategy.

We went to leverage neutral branch networks.

Also we don't need to spend millions in terms of condition.

To spend with channels enough first because we have this huge growth Avenue, which is the footprint and we have this opportunity and this revenue growth, which is the synergy capture with this two things that we can be lighter.

Simpler.

Without losing profitability and being more profitable and also faster.

This is key to grow keeping the tradeoff between volume and value that lead.

Our.

Greater valuation until today, what's habitual said is a market that in the past few years has career.

Ron and his approach, which is very similar to us.

It allows us to keep on growing and not losing this trade off we are managing by now so thank you Fabrizio.

Now here on broadband I'm gonna bring two new themes that are typical from our agenda.

Which are opportunities of M&A.

And then I'm going to talk about the F. W.

When we look at the Reits.

Graph.

Graph, we're going to see the market share on our main fiber players in Brazil, we cannot talk about fiber because fiber is the future. This is what I'm talking about now when we look at this graph and we understand that actually.

The broad band World and is capital intensive and of course. This is mark this structure will be consolidated.

On the left hand side.

We represent.

The EV per customer over time since D V T acquisition until this semester.

So you can see that we have a reassessment on customer value that is decreasing.

This is clearly a movement.

That makes our market consolidation easier and gets closer to what we have internally calculated as a customer acquisition cost.

Here I would like to send you a clear message that we have just.

Concluded the Oh acquisition, we are talking about it billionaire synergies.

Our focus on the short term is to land those synergies. So we have a team that is being in labs.

And whose objective is to make synergies often.

But optionality is our focus and we want to focus on capturing synergies I know it just seem.

That's I would like to talk about this F. W. A after the way.

It's very exposed in certain markets, especially USA.

As a team we have a small F W base.

We call F T T X or were the first to experiment and five G. I S. S. A in Brazil. So we're the first wants to understand how does technology works, we understand the market. The Mark here is represented by two to 3 million accesses to.

To give you another point of view according to the studies, we are running a we can have eight eight.

80, 150 clients. Besides I don't we have 20000 sites. So we have a potential for the market that we can think.

Of launching the F W. Eight.

Which will be a part of our portfolio. We are hoping that some conditions will allow us to deploy this technology in a meaningful and commercially.

Interesting.

We are talking about the CPE cost it's about $60. We are talking about an average of 150 to 400. So the clustering is that dropping and as our bottleneck is dissipated and this market will be selective and.

True to our portfolio the conditions.

That are present today in the USA are not immediately applicable to the Brazilian markets.

Ladies and gentlemen that smell move to our next presentation and we are going to join our exponential growth category, we were talking about businesses and broadband and we are going to talk about our potential exponential growth. The first one is to be to be in.

B to B, we are building and working on building this growth platform.

We are.

In a leadership position when we talk about agribusiness, we're get into more details later on and how we then move forward.

Sure.

I'm Gonna.

We have selected a verticals who want to operate.

We once.

The vertical is selected we are commercially working on gaining clients and leaders in those verticals as we.

We can build an ecosystem are quite into vertical and clients to supply solutions.

So it's a simple strategy, we need to fight with each of them for that no. We are doing it in for a J.

With quite successfully here the verticals we have chosen.

I agree with Bezeq agriculture logistics mining and then we have utilities and health care. When we talk about utilities are you talking about the smart cities that Leo mentioned why have we chosen those verticals they have some.

Conditions are special one of them there are large verticals involving lots of volumes of money, we have intelligence technology.

It is especially useful to improve profitability on a vertical third on main of them the process.

Bins in Brazil. So here, we are debating with decision makers on solution on technical technological solutions, let's say we have.

Style entities, who is a global operator, we are partners with this operator, so we can be connected talking to car manufacturers are not necessarily decisions were made here in Brazil. What is the development. We are the leaders in I grow.

Whoa.

We are building.

And consolidating our position in logistics and mining.

While we are experimenting.

Pilots, southern cases, and utilities and health care I would like to invite Paolo Humberto.

Paolo Humberto.

Is our.

The b to B vertical for Seattle.

Remember and before we talk a little deep there about it let's watch a little video.

George.

Okay.

Oh God.

In July .

Uh huh.

It's Jim.

Good morning.

<unk>.

Okay.

Uh huh.

Okay.

Okay.

Okay.

Youre welcome.

Got it.

Yes.

Technology.

So can you give us a minority stake.

Mobile connectivity.

Connectivity.

Yes.

We got back so I would like to ask you something.

Which is it's usually irrelevant for our analysts how do we make money out of it what is the business model.

In terms of taking this model when we defined the verticals our team works into demand analysis.

And then.

For financial model for each vertical.

In terms of agribusiness.

The number of users density before by.

Square kilometre.

The financial model won't work.

<unk> new business model for that group business with you set up the initial surface plus at the service revenue.

The medium long term agreement with this our service revenue tripled in 2021 compared to 2020.

For each segment, there's a new segment model.

Capex when we see the utilities.

Services.

That's what we're doing for each segment and realizing the best financial model for that vertical.

Yeah.

Now we're talking about <unk>, but we have launched the first five G farm a few weeks ago cannot tell us a little bit more about our plans on technical evolution.

So we can see if there's a separate business model, where a consolidated were part of the agribusiness.

Ecosystem in Brazil, with a series of numbers.

We've seen we have more than 7 billion million access with the mobile.

Coverage.

We can grow with this too.

13 million hectares with the NB Iot.

But also we have a social and digital inclusion of more than.

900000 people.

15% of the population 25.

Luminous rose more than 50000 small producers benefited by the investment in the agribusiness coverage.

And about the other verticals Paolo what do we have here energy mining and so on.

Let's talk about the other verticals.

With Oh.

With the leadership team.

Scaling up in agribusiness.

We extended this model in place.

The vertical view for all of our segments.

This is a reality when we see the excess basis of Iot and connected.

<unk>.

It's basically doubled last year and some examples.

Partnership with N O energies a N G implementing solutions.

Smart city for.

For instance, not here only in so Paulo, but in projects.

I agree with.

Program light for all.

We.

A guy coverage project in the <unk>.

Order with believe you a for instance.

These.

Partnerships are quite visible and we're increasing in the market in terms of mining we are working in this roadmap process.

In cases, with Anglo American Alcoa lending mining.

And then in terms of the industry with the Sterling.

We've been working for over a year in this project connected car. So we started in February of last year, and we have connected more than 100000 vehicles.

And also we have the first mover.

Four zero industry case, using the LTE five G S. A.

With the edge computing.

And.

Artificial intelligence this was done in a partnership with Accenture.

And what we're using today.

Bill.

This new positioning in the value chain.

With Accenture with engineering, Microsoft intelligent.

We want to join connectivity integrate this new platforms and services of Iot.

Two.

We have a new solution for the Brazilian industry.

In terms of Ah I can tell it in the Microsoft.

Partnership we're going to.

Publicize that in our press release in the next days.

Thank you Paolo so here indeed is verticals gain clients and set up the ecosystem.

We are leading actors in that as Paolo mentioned.

Last week.

We had average selling them to bear on Fred's opened the state of San Paolo they're great as I grow a business fare in Brazil.

There we had the Agri show.

Highlights N team was there with their Agra Palmer.

Partnership this is and I agree with vans and we got there and we are a highlight among the highlights of the event leaders and leaders. So there is a I would like to give the floor to renato to talk about customer platform.

Thank you Alberto good morning, everyone everyone is connected.

We have a few slides but do.

We have Oh, we have more time.

Uh huh.

I'm going to talk about five things here. The first thing we're going to have a recap on our strategy.

We presented last year, but I think we can have a recap.

One what is our strategic intention.

We're going to talk about our secret our magic sauce, what are we doing that is working within this strategy. The third thing is the rig.

So that we've had before well we're going towards.

When we talk about the new partnership that we have in terms of security.

So it's about six seven slide five topics and we're going to talk very briefly about this but we're going to have a complete view.

Oh, Oh things the first thing that we want to.

Two states is that we're going to generate value outside of our core business through partnerships and not only internal development, we're looking for partnerships.

We have few partnerships and partnerships with a hypertension.

Well, we go going after a unicorn.

Want to do what they'll comes did.

Unless you're a huge number of partnerships, but irrelevant partnerships we want.

The partnership has been very good partnerships that can bring a high value.

Which are these partners. This ideal partners there's companies that we call theater that are ideal for this process.

They're not startups that I don't have a proven protocol there are companies that have.

That have proven their product and they're looking for in next financial growth of the client basis.

That's important because when we talked about this several startups started calling us we're not looking for that we want.

Well companies that have their product proven they have a market fit and they need to grow their clients exponentially. We cannot do a pilot for a CD or first aid our coverage is meshing a little.

We want the all our client base.

What's our.

Working model.

It's a model that we call Kenneth.

China is a service where churn channel that work as a service.

And we exchange.

Customer base for equity.

And we want this company to have a disruptive offer they need to be very well positioned in the sector and we will receive an equity that has a high value in this company.

So we look for companies.

That are about to have an exponential growth in client base they have there.

Product proven.

We will work as a China as a service and we're going to experience customer base for equity.

What are we getting as well.

We're going to bring a unique and disruptive offer for our clients.

These are credit cards.

Chip Recourses.

Safety security offers.

So it will add value to our base client base and we have several studies that prove that the glass that is more engaged that has more services with us they have.

Lower.

The cancellation rate in one of the intentions is to reduce churn in the next years.

So it will generate values in the core business and have a lower churn.

So we'll have a distinctive value proposition it brings several information and data that no. One has so we begin to have.

The telco.

Information data with financial service with Education service and Health service data.

It will allow us to have a new revenues.

Will allow us to have a solution portfolio.

Advertising there is a lot more powerful because it will have more channels in more data and we will it will generate.

Equity.

For high value companies. This is a strategic framework and what do we think that we are relevant in this ecosystem why it's relevant for a company such as this and we have a few assets that are unique.

With the Oi acquisition, we have 60 million clients.

One third of the country.

Very few companies have the client base such as big as this.

We have 550 data points per client in our big data, it's what do we call it teams insights.

We have we do this integrations with partners and we can.

Great unique offers in the market.

Because we can use our data and the data that they have on their side.

Yeah.

We've created a service offer integrated with their partner offer which is very differentiated.

And when we began working with this many months ago.

We had adult.

Where are they call our clients interested to change their consumption.

With the with all this information and our.

Clients were interested in being part of this partnership and received this jirga bonuses.

We have a real benefit to provide through our basis, Nick change of this partnership.

Yes.

Newport.

We have a unique capillarity.

Brazil is a huge country continental country.

Wanted to have a national.

National presence.

We have a point of say everywhere, we have more than 100000 salespersons.

Very few companies have this capillarity.

We have this.

The ability of getting 470 65 Bryan.

No.

Hey.

Right.

And we have a.

Top of mind brand.

Which is solid.

And very few digital companies have.

We have several research.

Right.

And three years ago, when we began our research.

We saw that several digital banks were coming because of it but we need a digital bank.

Team chose this bank.

And this must be a serious good back also.

This.

This is very important and that's why we chose C. Six and we believe that we have a package to offer.

And we see that this is very important for these partnerships.

What are we looking for.

We're looking for the segments in which the value for client is much more than we have in terms of telco financial services.

Firstly.

Look for our financial services and there was between.

605 hundred.

Dollars per client in 2000 colors per client, which is different from telco service that goes from around $100 per.

For clients.

Health care for instance, or other services are around 500 to $600.

So all of those companies.

Value to the client have a value in the port.

With the clients that is higher than we have where they can claim for that company.

And it is the next change when we had one part of that equity part of that.

That was added and the other on the other side and our goal was to have a set of participation.

That.

Good.

In 2027, it will have a market value of around three to 5 billion right.

And the novelty of that and we're going to tell.

This series, which is a bit of a magic sauce.

How can we implement this within a carrier.

Yeah.

First we did a partnership with Accenture that allowed us to bring dedicated teams to the project.

With specific expertise of that.

Industry.

We don't have experts in house experts in House service educational services financial services, and we did a partnership with Accenture that brings teams that are specific of that industry. This is very important.

Second.

We created a whole communication of the partner software within the whole journey with the team and we have now 14 communication channels. We began with one two channels than we started building up and afterwards I'm going to tell you how it works in practice, we have 14 channels.

Okay.

Second pillar of this execution is a new segment issue.

We have a 550 data points.

And we can do a new segmentation and we can do it and offer that as contextualized and it keeps the relevance for their clients.

This is really important.

To operate within a.

Our new five months with simultaneous partnerships third.

Everything is done based on tests and results every day, we do thousands of tests with test segments.

Chad knows the media's with testing the day of the week the week of the month time of the day.

For example.

Yeah.

It's a bit out of context.

We did a partnership with a better company.

Okay.

In terms of advertising.

When we sent the advertising at the time of the Champions League game, There was a 40 times higher conversion rate.

So this context realization of the segment of the time.

And the channel is very important.

And we don't have pre created and says we need to test we do thousands of tests every month, which we validate channel.

Segment they time.

Right.

And when we see the highest conversion rates, we amplify and massify it that.

And last but not least we have a team.

Yes.

That is really.

Talk in terms of process and technology, we're using the most work.

Drop off.

Really.

Modern team.

We have a conversion.

Capacity that is very high and we can only do this with technology. So we have processing technologies.

Specialized teams employee.

Okay.

Hey.

Yes.

And another example.

It's good to exemplify why do we believe that team is the only one.

Not only Brazil, but.

And the point of view for solution and what do we have in terms of channels and processes.

Okay.

Can you.

Play the video.

Okay.

So we begin in the store so the communication of our partner in the store when they do the on boarding.

We begin to have the communication messages that gives them the offer a far partner.

Then we'd innovated and we've had an innovation with pictures and multi media, which brings a higher engagement with clients.

Is going through rich do a recharge process and there is a communication and they receive an incentive to download our app and loyalty.

Theres ambition then they use this mission to incentivize them to download the statistics.

And when it's intercepted when the.

Data package finished.

Finishes and they receive a message when they go into the App.

There are specific message.

When there is leave our email marketing we think that there is the partners offers one of the excess.

Our website and do my digital migration for prepaid to control Theres a specific journey.

They receive.

The bill at home. They there's also a partner's message when they call in our.

Call Center they received the message the message also they receive it bush.

Communication.

And last but not least.

We have in our meta versus same store.

In there they have the opportunity of signing up with a partnership.

We have 14 channels, there was a bit detailed but to simplify it throw out the whole client's journey, we've managed to insert communication of our partner why is this important because we've noticed that we need to have coverage and frequency we need to talk to the whole base, we need to talk in Iraq.

11th way contextualized and throw out all the time and if we don't do this we won't be able to reach the exponential base growth that we intend to do.

Next slide.

Well, let's talk about the results.

Sure.

We've reached four point.

4.8.

States. So so we've had of these top performance for seven quarters.

So we've reached they grow within the first two quarters and we've managed to keep this performance throughout all this time.

This is amazing amazing.

And we thought this would fall and it is not happening we are managing to keep the top performers throughout the seven quarters with managed to engage 2 million customers from our base with amply.

70000 customers have registered the amply platform in terms of a free courses graduation, and post graduation season.

All of our communications, we've reached more than 100 million people.

And more than 6 million customers have were converted two of our partners offers and we're also as they get more than 14 million Internet bonus awards.

So we do the ATL.

Communication, the BTR communication throughout the whole customer, Germany, and we see an adoption of the clients, which is quite high and this motivates us and because of that from several.

Companies are looking for.

And this leads us to this slide what we're.

Or are we in this process what are the partners that we are looking at and what we intend to do.

Yeah.

All of the partners that we have on top of it.

We have several companies have looked for us we've received several proposition, but it's very important to highlight.

That we're not going to do any kind of agreement with built in agreement that has a high value.

Bus ability.

Hold that our partner can grow become a unicorn.

And it's a joint decision with US companies, then that's and that's where we are we've been discussing with the Spanish for six months, we're refining the propositions. So that we are we can build something that can generate value to our client base.

Can be disruptive for the clients and it can add value to these where the conditions that were needed to make sense and to close I'd like to talk about the partnership that we're talking today in terms of.

Security partners that we've done with the <unk> company.

Companies more and more digital more and more connected.

The payment process.

Really grew and we will go next to your fix.

Success more than 17 million.

He didn't have at least one big key.

More than 9 million companies have a key a big scheme and there are several million.

Things.

Yes.

Operations.

Transactions per day.

And but there are also several issues in terms of print modality associated to that so today, we are launching the first product.

The.

Launching in the next months that is going to use technology and data science to allow.

A solution for two important aspects of the first one is.

This is not a problem of a social strict business.

For all of the social classes.

So with technology and data science, we will be able to be accessible to all our clients, whether the prepaid control or postpaid.

Second thing Theres, not only one person with only one.

Bank account in only one institution is a product that works to our her reality for multiple bank accounts.

Whether it's the financial institution or a payment institution.

This is the reality of the market no. One has just want one bank account.

So the product that we have with the digital print.

Protection.

So it will work in terms of.

Six assemblies to our client base and it will work for the presence market with multiple financial institutions and payment and institutions.

How is this deal and how we've built this with them.

It has a few innovative factors.

In terms of what we've done in the past and what.

Based on what we've done in the last two years.

So we'll have a newco will be formed between this team and F. S and Tim will receive a commission per customer capture for there's no quick.

And also we learn of equity in the Newco up too.

35% based on revenue generation it will vary and.

Customer base for equity as I said at the beginning of my presentation. So we'll have up to 35%.

What's the difference from this deal.

Prior to the others.

This negotiation will have a provision that will allow.

The entry of other partners in the same modality and then the same conditions.

Also other telcos.

Why.

We believe.

Sure.

That the bigger companies bigger is its chance of success and.

It's valley will be so we want to consolidate this market for the company. It will have a higher value and we will have a via higher boiler as well the other two.

Having other telcos also is.

Really positive because there's less conflict team.

Clients are not collaterals or vivo as clients. So the channel with less overlapping is there.

Coal markets. So this is why we did an agreement that allows other partners and the same modality and then the same conditions.

And as all our other business we allow this company to do an IPO.

In the timeframe of three to five years.

This is what I had to present back to you.

This is great to Kenny.

Well, we're going to have a break a 10 minute break so that everybody can rest a little.

Absorb and digest all this information and people from home can also refresh get a refresh. So we're gonna have a brief 10 minute break we'll be back soon thank you.

Yeah.

Okay.

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Yes.

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Yes.

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Yeah.

Sure.

Okay.

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Yeah.

Sure.

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Sure.

Yeah.

Yeah.

[noise].

Yeah.

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Yeah.

[noise].

[noise] born change.

Hello, guys we are back.

Presumably the van so let's move to the last.

Set of content.

Yeah.

Yeah.

This communication moment, we have now.

We are working with our intention to generate a better.

Yes.

Value proposal for investors with our ESG agenda, when would that we're gonna have might've just a solidly and then we have the three pillars that are gonna be.

Proposed.

Presented by Camilla <unk> the floor is yours. Please.

Thank you for saying too.

Good morning, everyone.

It's very important to begin this list.

Synthesis session, because it's synthesize as a value creation where is the best.

Value for the community.

The ESG agenda.

Tim.

There's not a lateral agenda.

It's an integrated structurally integrated agenda.

Some chillers.

In some pillars D E F. G has been dealt with.

And here, we can synthesize this.

In the center, we have our business strategy.

We have our.

Pillar of environmental social and governance.

And team their forms of integrating key elements in the business.

Yeah.

And that means people in terms of social and environmental.

The resource and natural resources and poor governance.

Vital system.

These three elements, great business, and we create a different agenda.

But it it's actually a philosophy for value creation.

And then this is what we're trying to synthesize them today and soon Camilla will summarize this.

And then.

We have this whole agenda that is structured.

You should go and initiatives metric.

That involves the whole company what have you.

And ESG plan.

Okay.

We.

Certain goals.

The medium long term goals.

And also we have some names ambitions.

Here, we have the environmental pillar, we can see.

The main.

On the left side here, we can see the main target.

And what we've achieved in 2021.

Kansas T environmental terms, we could.

Have a strategy mix.

In terms of energy.

Energy generation.

Compensation strategy.

Or with.

Yes.

100% renewable energy.

Also because of the eco efficiency.

Which is.

And part of it.

Data volume based on the consumed in there Jim.

Oh here, there's an environmental.

Significant but also our business significantly.

And as Leo has said this morning.

But we have the biocide coverage it has an industrial.

Gander that will become also system assisting the ability.

And because of the Victor.

2021.

We.

Ed one of the greatest enabler the linked bonds.

That today places.

Uh huh.

We can say that we have a sustainable finance.

Going towards social.

Later, we will.

As it was.

Highlighted by Alberto.

We have to see.

We are really proud.

Oh the <unk>.

Our first.

In terms of diversity and inclusion policy.

In terms of your for telecom.

Company in new work.

So we're really proud of that but it's not a surprise because this has been a long journey.

Sure.

I'd like to highlight.

Relevant thanks.

And the inspiration of the hour.

Who HR RISC V P.

Maria Antonietta.

This acknowledgement came.

The first.

In diversity and back office.

The diversity globally.

We are.

Knowledge no place where this values are present.

Whether internally or externally.

Yeah.

At the same time, there's an industrial agenda.

That hasn't been said of that team is the first company that has.

It's a commitment to have fortunately in all municipalities in Brazil.

Okay.

It goes beyond any.

Target in NFL use was our goal.

And this is perfectly coherent with our industrial journey and with the possibilities.

That a four G connection or no.

Brazilian municipalities will create for the population and once again.

Yes.

We want to share the ESG agenda industrial agenda. There are two phases of the same coin.

Lucky.

Yes.

And of course as less pillar.

Yeah.

It is the governance of the songs.

In governance, we're the first telcos.

As it has been said.

We've received the pro ethics Phil.

Yeah.

Also together with that we had of the I V.

And anti bribery Mad instrument system.

And so.

And Oh, we've we're.

We're acting very strongly in this agenda.

And with them.

Yes Chi environment, we have.

Our commitment with the consumer in one of the less interviews.

The.

Relations consumer relationship.

It provides there before she left she said that the consumer agenda.

Has to be present in the yes. She agenda. We're doing this since 2019 and since then we've managed to have a significant reductions in terms of consumer complaints.

I'm trying to simplify consumer's life.

We are first in the NFL rankings for customer satisfaction related to an adult demands and also where the company that is.

At present.

Longer present, AMD easily be three for 14 years.

And since 2011, we are at the Novo Mercado.

Stock market so.

We have a commitment okay.

Transparency and advertising.

Closure.

And.

This is being recognized because of also because of an assessment.

This closure of this issue so that you can find it in our channels.

This is considered to be.

In our international level to be excellent.

Excellent.

No.

We have several metrics and goals that is structurally integrated.

With the value creation philosophy.

And we have several opportunities now pass the floor to Camilla. Thank you.

Thank you Mario.

Well move them back to numbers, what we tried to do in this slide was.

I'll try to summarize and translate into numbers. The efforts that my colleagues here have been informing us since the beginning of our presentation. So basically what we see is this additional effort in all of those initiatives that have been presented here are the ones who are going.

Two leaders.

To a growth in our revenue that in the absence of those and Ive said, Kevin we would have a single digit growth, probably which is public probably the expected medium term inflation rate and these initiatives are going to allow us to double this growth and have a.

Growth of our revenue up to 'twenty 27 of our by the high single digits. So double the speed of our revenue grows.

Due to everything we have presented so far when we look a little closer to this graph I think that what catches her I understand surprising in that great share of this.

<unk> growth comes from our mobile initiative, which is our greatest revenue generator here, we have OA and five G. Followed by broadband and then B to B I O T and lastly, the customer platform.

But I believe there are three points here would like to highlight which as far as.

Necessary capital to make them happen. So that's surely the mobile initiatives they are apart.

They have a greater percentage.

What's the patient where they also demand greater capital, especially in 2022 as we mentioned that as they migrate towards the right side of the graph. These are an average.

He said to me that we can leverage our revenue was lowered capital from our company. Another point I would like to highlight and this graph is that it does not reflect the creation of value by the company.

It only reflects the revenue increase and as we can to move towards the right hand side of the graph the multiples tend to be larger.

So as our expectation is as we move to the right and those little square star, representing a greater share of our total revenue and total business did well also represent a larger multiple by the company. We are great we add great value to the stomach.

Change and lastly, specifically in our customer platform. This graph doesn't also.

I think it was captured the value creation by equity.

One of the pillars of our guests and our platform strategy.

S clients in exchange for Appalachia, and we believe that this be this can be a great value.

It's called value.

AD strategy.

<unk> tried to do so when we have the increase in revenue due to the expansion of it there's multiple we have the value creation via equity and the parties. The parties. The equity do you. We we get through the plasma we got from our platform and the last message here and what we're going to explore in the next slides.

Is that we have thought of those initiatives.

In a way that the necessary capital for deployment.

Grants us a great balance and growth perspective and.

How would you shareholders earnings. So this is something that we have in mind for our journey towards 2027.

We also must remember profitability.

And I know this company has worked very hard to be in the level of profitability that we have today is being recognized as one of the <unk>.

<unk> is leader is that we are going to keep this.

We're not gonna grow despite anything we're gonna grow increasing our profitability and here we show the expected evolution.

All of our EBITDA minus capex over and that revenue besides.

It's just having the traditional initiatives of cost reduction that we are constantly implementing and also digital transformation.

We are going to use to allow them to leverage.

Profitability, we have some one off an extraordinary facts that drove all time help us leverage profitability, we have first the transition and integration of <unk>.

That way.

Weighs on our P&L.

As you can see that will happen between 'twenty to 'twenty two 'twenty three and from then on we are going to be able to use 23% of this margin contribution that all your brains.

We also eliminated by 'twenty 'twenty four this initial five G. Additional cost that we're gonna have a deployment.

And then we start had been having Android direction of Capex and Opex apart from revenue.

And moving after 'twenty 'twenty four we then.

I have the full benefit.

The infrastructure, we acquired from <unk>, we showed that present value of this acquisition.

And we're gonna start and have the initial five D payback.

With that we expect.

That our.

Martin that's in 2020, one was about 24% that it should grow to 94% as presented in our guidance and it keeps increasing up until 2027, and we are not giving a guidance for 2020 seven but I think that's what the graph.

We can say.

Say that we'd not establish when does that is that in 2020.

One to keep remain the most profitable carrier in the sector.

Yeah.

I think that everything that we have.

It's about here is pretty well portrayed in our picture on the left hand side. This is a very tall circ.

Circle off cash flow, we increased our revenue we have goals of growth as we focus on profitability and efficiency.

Well, we have sustainable growth, we generate more cash.

And I believe that everyone here knows that the company had been adopting this.

Position of preserving liquidity.

Actually with five G and Oi in 2020 two it's important to remember that the final conditions off or in fact, you were only now in the second semester of last year.

And after these events, we still have some reimbursements, but they are known and predictable I believe that company now is ready to enter a new area for us.

Shareholders' earnings.

We had been.

<unk>.

Been getting questions from the market when we hadn't been answering that because we believe that went into any two of those are large and important event, we will be in our path.

So now we would like to announce that we have already.

<unk> released a relevant factor, which is the intention of the company already referring to the year of 2022, just started distributing double that cash as previously as in the forces for years.

And for them off.

Profit over on capital and dividends and we should go do so moving forward.

Of course, we have all of the caveats as we confirmed all digit cash generations generally just for this year, we believe that they will be confirmed.

Except for some chaotic external factor, but this is our expectation and their recommendation we have taken to our board.

Why do you believe that this is key to us.

We had our cohesive.

I can't I, Kelly's heal and we believe that everything.

What had been a pretty well positioned in the market, but we believe that in the our yield we were still behind so when we look at the graph on this slide we understand that this new level well granted that position on the right hand side that is among the.

The telcos that best.

Compensate their shareholders and to the right. So this is the level that we intend to perpetuate for the next few years and I think this is a cherry on our cake in our history.

To summarize.

Yes.

What do we see today as a value proposition for our shareholders. We are probably the company that have most short term benefit from market consolidation. They have a strong balance sheet in several areas, we have fewer consolidation problems and Ann.

I Trust and so on.

That allows us to be the wine so benefit demos to do a convergent offer.

Even more and more convergent.

We are innovation and partnership leaders.

So we extract additional value from our consumer base and this improves the experience for our consumer to we talk about profitability, we are leaders in profitability and with concrete.

Plans to become a more and more profitable and remain in this leadership position.

We do not have any exposure in phase out.

It says, which I believe at T plus we do not have a copper lagged us see we do not have a house pay T. V. So we did not have to be concerned about how to substitute just consumed revenue our revenue trend tends to grow in all aspects as my O L Sands.

I'm sorry.

Oh profit is.

And integral part.

Everything we have is an integral part of our strategy and finally well.

We can say is that from 'twenty to 'twenty two.

We are comparable to the best.

Dividend payout among our peers in Latin America.

Which complements the left side of the graph and positions us well.

As a vehicle of choice for our telecom shareholders.

No.

Now.

I will turn the word back to Alberto.

Thank you.

So.

We spend a couple of hours sharing with you the fundamental elements of our strategy.

That are summarized here in this class.

Slide I think we've covered very well.

Our commercial strategy in terms of core business.

<unk>.

And it has.

Thank you Vanessa.

In terms of market growth.

We have solid plans.

Come it'll just said about the our profitability expansion does this already foreseen in our three year plan.

We've seen a few upsides in our presentation numbers.

Also we have a very strong track record.

Yeah.

Two lenders.

Ability.

So we're totally committed so this happens and we've always.

Seeing how it translates in our policy review in our shareholders.

Policies.

Also we have.

This transformational process.

That is a possibility of generating millions of rise to us and also.

This will be the focus in the next years.

Because there's the spring months old that this our growth platform really happens in the next year, So I'd like to thank the center.

For organizing this event.

Colorado Who's not here.

Working with Asante.

To build up the structure.

This next generation structure for all of us I'd like to thank the whole team.

The whole leadership them.

For a another solid delivery this quarter.

And also.

We have people behind me you fill them in front of me. It's also I'd like to thank the whole team theme.

For this amazing Greek zones, and the amazing reserves, we are still to be seen.

Nobody.

He might have.

Still a few moments before we conclude our events I would like to thank you for your acknowledgment.

And since this is a hybrid event, we are gonna have events from our.

Onsite audience should it be interested please raise your hand identify yourselves.

And when your question our executives will be ready to answer all your questions people, who are watching us through the platform you will have a button to press way you can write you a question.

Please feel free to send your questions in English ones, well will translate the questions. The questions will be answered in Portuguese and it will I'm gonna have simultaneous translation into English.

Please feel free to ask a question. So we are fully available for the next 30 to 40 minutes.

So we can't answer all the questions that may still be.

With you.

With that we can start our Q&A, we're just concluding some last minute arrangements, but I'd like to thank you for your presence here.

This event has made us very happy both with the onsite participation, but also with our online participation. We have over 1300 people that connected it's quite a number.

And it makes us very proud.

Knowing that in Investor day, like that's picking up so many interesting.

Seems can attract so much demand from the mine kit.

The desire to learn more about the team and its results now that our organization has been done I would like to.

A round of applause to think carefully and to all of us.

Let's go until the very last mile off this journey.

<unk>.

We have Bernardo and then we have Diego.

Okay.

Please can open the mics.

Okay.

Next exchange microphones I'm sorry, Brian .

Thank you and congratulations fourth event thank.

Thank you for the space I have two questions for Renato.

First is about the new partnership, but now if you could explain a bit more about the protocol in terms of the security vertical.

Second is about the arbitrage process with them.

These six bank if you have whenever we're concluded.

Thank you for the opportunity to explain our partnership unsecured debt, we have announced today.

Such a partnership at this point there are several partners that offer several services and we are just a pass through channel.

Pigs.

Yes.

Yeah.

<unk> innovative in a market that has also represented a great problem. So I carried out several studies and we are launching a product that is based on Pip payment and we will associate this offer it's not fully ready to be announced.

But the idea here is that picks become.

A he's essentially in our payment processes and pigs has this issue of all crimes associated due to its penetration so.

We are going to say are we going to once again be a pass through of a project with little margin or is there an opportunity that we can work with that fast that is a company's specialized and security working with carriers for over 10 years, it's been doing it for over 10 years that we are partners.

And we drive this as we drove the physics and unclear and the valuation of the company.

Per client, but consumer tech companies way larger than town. So it is born as a proxy for that is that they just don't protection is a soft to an application that is installed in the person's cell phone and within you'll have it picks insurance.

And then we can use the entire technology and data science to reduce fraud by reducing fraud, we managed to have a more accessible price and more possible price for all kinds of customers, including the prepaid that increases our mass.

A hugely because otherwise we wont have the penetration that we need for our high value product that fast is an expert in this business. They have a technical capability and technological capability to create this project to use 80 using data science for that and then you use the power of our sales channel.

If we try to do it separately, it's going to take too long. So they develop we are not just a pass through channel. We are partners in this business and then it is justified that we drive throughout their journey design that I have presented and this company will we expect to have evaluation as a tech company and not as a.

Telco company and then we can generate value. So picks protection is the first product.

Next we are going to have our team marketing teams and their marketing team to create a series of digital product one of the challenge.

One of the goals that we see is that our digital assets increase our advertising audience, we start having more audience advertising apps.

And it increases our data Lake we get more data we get mine plan.

See my insights and create more products. So there is an immediate benefit that we become partners with a company with security expertise expertise with a technical technology company valuation and we collect several other benefits when we talk about the advertising data monetization and we're going to get out of it.

To work together and create new product the digital world.

Fortunately or unfortunately gets reinvented every three 612 months so its not a product that will launch now and we're going to remain with the private for five years.

We need to have a product line to machine.

And that's how we're going to deal with them in the traditional partnership you wouldnt be possible. That's why this model that we created here, we believe to be disruptive and once again and innovative.

Actor that we and we have already foreseen the entry of a new partner because as we scale up we're going to get a better return.

Okay.

Helpful.

So.

Yes.

This was relatively prudent in the lunch and dinner product.

You know that we have this.

Prepaid controle to postpaid.

So the payment process billing as.

Slip in credit card.

And in our commercial with several clients do not access this our clients.

Clients, because they have credit problems.

Availability issues and so on.

So the idea of launching a pitch control combines all of those elements first the market innovation.

It's a newer control.

Fix.

Process is growing a lot.

So the value proposition to launch a new product to.

Process, adding value.

Okay.

With the picks insurance.

And also having fritcher process for the client for those clients, who have the possibility of a associating both also an advantage.

This partnership.

Okay.

T.

The physics arbitrage I am looking at <unk> and he's already.

Okay.

What do you like to answer.

No.

No. We can't say my this is a confidential process I believe that while we can say is that that partnership is Danny we have reached four 8% equity.

And the bank.

Okay.

Oh, let's go for the next question I think it's still go out to go.

Thank you.

And do you ever I got from Goldman Sachs My first.

Question on our pool, we saw this great trend in the last quarter.

And it has been going on for a few years, but when we think of this consolidation of market moving from five to three carriers over two years I started thinking of five G is it something that can improve the consumer value proposition how can we imagine.

I pulled that was historical deflationary in Brazil do you see your next step for us to see an IPO.

Almost like a same store sales just growing with inflation or even above inflation. This is my first question and my second question is maybe two camellia.

When we look to the cash flow.

Obviously with Oh integration, you start having a totally different level of profitability as in the past, but at the same time. The company is doing some movements to become.

More asset light and less as it has the selling towers and data centers.

So we're gonna have some part of the costs there are going to.

Yeah.

Be like lease under EBIDTA.

If we wanted to do a calculation to adjust I explained expecting a simple cash flow margin.

30% for 2025, if I'm not mistaken so what should it be this cash flow margin considering the leaves us. These are my questions.

Okay.

The ARPA question, then Camillo will.

Talk about the true if you'd get the ARPA RPM.

And we have this growth proposition for a while and I think that we could divide. This question two answers we have the prepaid and postpaid war they are quite different.

Mortgage between them.

Postpaid, yes, we're going to grow this year and in the next few years the inflation now, it's particularly high but we have several tools.

We're using them to do this.

To make it happen what are these tools we have.

More for more adjustments and the five G is coming Indiana.

We have all this activity in terms of profitability nation that is working very well.

And after was the more for more.

Analyze the client profiles, we can migrate.

Giving more benefits of extracting more value and as we have also the system are they always customer base there.

We can work in the same way.

So we.

We have a very positive answer because we can.

Grow the <unk> and.

In the postpaid in the next few years in the prepaid ward.

This situation is a bit more.

Technically it's more it's harder to act.

Himself offers.

First I'd say that the our view is we.

Can we in there we need to see the spending.

Okay.

Well, we can increase spending in this last quarter this is being diluted.

How are we doing this where.

Adjusting a few things in our offer that has to do with phase with the face value and some benefits.

That we are providing to our clients relocation of our clients.

There's an AR BTL activity below the market analytics studies.

Working.

So it is harder to grow in.

The postpaid speed, but certainly it's in our priority to increase our postpaid spendings.

Camilla.

As for margin I believe that it's important that we should separate mam mobile from broadband because these are completely different worlds and more by we do not have additional this investment forecast when we were talking about the D. I F. R. I S.

And they paid Oh, we are investing from towers and other assets that will.

Have caused slower than EBITDA and that they will increase or reduce.

Our EBITA EBITA without threats quite the opposite since we have as we mentioned in daily event.

As we bring this all in more mobile.

I see where you're bringing 600 million 18 months on.

Costs below EBITDA with towers.

Two will sum up to a little less than 900 million, but with our decommissioning plan and our accelerated plan that we mentioned today. The idea is that we managed to reduce those costs quite drastically.

Almost as a proportion as the number not of towers, but a decommission sites.

We do not expect that in mobile we cannot have a EBITDA margin dilution after leasing because they had no initiatives and defense I think that's quite opposite Oi is contributing to the decommissioning plan when we look at.

And then we have all the gains that we have mentioned we have a.

Capex over all of our margin overtime reduction.

And we have our current margin that will lead us to the growth of our EBITDA minus capex.

Martin Let me look at broadband then we can see that we have opted for the asset light model, but it's important to remember that the ice systems costs. They are costs above EBITDA.

And they have been.

Fully reported.

As the broadband business.

Start have a participation of share in our ravin, our greatest sharing our revenue there is a trend.

Of diluting our.

At the IFA.

As far as big as it is and I felt like business. So the.

On the other hand, an EBITDA minus Capex. This effect is no.

Because it tends to have a lower EBITDA margin because its a service agent, but on data handling requirements for Capex is much lower especially when we think of a moment, where the business growth is more stable.

When do we are growing we are when we are still lacking stability the asset light business.

Still needs.

Basketball and adjustment, especially for additional traffic, but once we have stability there.

Requirements for Capex is minimal and we have basically all the EBITDA generated by the convertible business in our cash.

EBITDA minus capex in the future there'll be both equivalent but with different component Marvell would the hot mobile with a higher ad.

Margin subtracting K bags as Lee mentioned.

And the broad band with a lower EBITDA margin, but almost fully converted into cash.

When we look at EBITDA minus Capex margin.

Oh I see.

So for the next question Marcelo Santos.

Feel free to ask your question.

Good morning, I have two questions.

First is to come Elia a.

I would like to hear about your optical elaborate vision I think.

Tim has always had a low leverage how do you see more going forward and on the fixed Capex and I systems models. CPE is next to eye system, one extra team because even if you stopped the growth you'll have a natural churn in that would generate.

That would create a cat.

Sure.

The answer for a piece on our side.

What happens.

It's true.

Okay.

What you're saying.

If we stop growing.

To have a C P X gene.

To try and reposition or for technological reposition but anyway.

Looking.

At the eye system deal it.

Is less isn't part of our Capex.

Yeah.

Or over.

Oh sure.

Repairing for instance.

And we're exchanging a capex for Opex.

Yes.

They're not exactly equivalent.

Minus.

Capex.

Then we have the CPA spa is on our side.

And we have the scale and the scale.

When does the growth in the next few years it will.

Got it.

Happened anyway so.

Okay.

Moving to the second question I don't believe we have an internal debate on setting. This is two times or three times a one time is the optimal level of leverage I think the.

The normal process as far as strategic.

This is amazing king, especially on <unk> and so on it it is leading us to a leverage a little.

Lower than two times EBITDA, we also need to consider that we are living more stressful moment, even domestically or internationally, we have higher interest rates. So it's normal that we should be more conservative in this moment, but moving forward.

Looking forward, we should read how the market moves and see the conditions that are off.

All the investments that are in our favor and what comes in the future and just state right now that we are comfortable with two times or three times.

We are now at two times leverage if you look at our recent standards, we feel comfortable with the 2%, but we raised the payment level and we need to take one step at a time.

Yeah.

Well next question I'll read a question from the platform of this question is coming from summit data.

So I'm going to translate it here, so sorry, if I if I take a while.

The first quarter numbers suggest that you are able to keep <unk> growth.

Rear next to the inflation do you believe.

Excluding ice systems and this will remain.

Also linking with his family.

Prices in the first quarter.

Some.

I just mentioned.

Foreseen in terms of prices looking forward.

Let me talk about pricing and then EBITA.

<unk> suffered some adjustments at our customer base adjustment took place from March on for the control plan and on May four postpaid just reminding you that we implemented this adjustment and adjustment once a year in our custom.

My base do you just meant that we are forwarding until our customer is.

Essentially connected to inflation.

And our control we have had the adjustment of six eyes with an offer that is turning about 93.

This is we're talking about and that adjustment Atlanta with inflation rate.

We also understand that we have the possibility as we did in the past to keep on adopting those policies in the next few years for both customer bases came and noise.

And for the cost dynamic.

Evolution.

And when we talk about a bit of course, we have several elements that play a foreign again, so when we talk about.

I say this I mean, Lena Zhang <unk> play a little against it and we have some organic but we are.

At an even number when we talk about our cost categories, we have.

Electricity issue. So they moved from the Red flagged into the Green flag. So these influences our cost we have a H R. We have real estate, we have from Lee from Leo here, the passive network costs. Besides that we have very <unk>.

The plan.

Really.

Since last year because inflation started.

Last year again, but part of this inflation rate that we can recover through our plans and these blades on digitalization, we are still advancing in that field, we have b P. OS that we are implementing.

None of those are in network that is connected with the after lease then each area already has a plan to recompose.

Our inflationary increases that we have identified so we are.

Relative we are quite confident that as far as inflation, we will be able to absorb it.

Alberto if you allow me.

In terms of the guidance that we've published to the market the three year plan.

We didn't open several layers that Alberto said of the five GB high systems and all the fact that this is not open in the guidance, but we did this very well segregated in house and now we're at a.

Our profit margin is quite constant so.

Think it reflects all of his efforts that Alberto was saying and I have the margin maintenance with all the oscillations work.

Coming from this new factors and that have a differentiated.

For instance, the yoy.

So it also diminishes the G O nose and Theres, a very constant baseline.

I'm going to have one more question on from a platform. Our next question comes from Fred Mendes from Bank of America.

He addressed it to Lisle, but I think that Alberta should.

Tip in with his CFO , Pat now that you'll have this competitive advantage in terms of a spectrum of intact and.

Speed given the legacy of other players how does it work contract about the texture of team. So that is our advantage can be profitable.

Yeah.

LOE and <unk>.

Myself.

We always have this.

Positive constructive dialogue.

<unk> offer.

And.

No work.

We have years.

Oh for positive dialectic.

Topline point of view doing something very rational and commercially.

It should go.

And what was the network capacity.

So dynamic that we have that works very well and then we have this spectrum I've been down so we're not losing bags.

So our goal is to monetize these.

To do data monetization with managed to do this.

Within a year.

Scarcity.

Context versus competitively versus with something that we're not going to lose in the next few years, because we have a spectrum.

Got it.

And now we went from scarcity to I've been a bundle.

So this is important for us for our revenue.

So we want that this happens in the same way.

So I'll comment on our book.

Just adding.

Two when Roberto was to US here Oh, we have this regular committee on traffic, where we analyze not just the general Bud region per region. How is traffic growing how is traffic and monetization going and we also sat analyze what is free traffic.

And non free.

Traffic depending on.

Supply.

And it's not because we have abandoned now that we are not going to try to monetize I think this only reinforces the more for more logic because it gives us a new road, a new pathway, where we can differentiate the services. There is something that we did not comment on our presentation, but five D, bringing us licensing opportunity in a way.

Do you have that you start not just bringing opportunities to the brain gigabyte packages, but soon you will start working with mapping resilience and mapping resilience. So we believe that we need to look at this abundance in a different way monetizing.

Our core business I'm more for more and bring opportunities to be.

Have differentiated services that we can bring to the market are different and interesting concept that does not relate it to scale.

Is that we have this.

Our agreement with the T V broadcast away or we have this.

Sim card with a differentiated link it to us.

Footage transmission, maybe N and M moment on the strange way Youre watching some piece of news, but then you have this monetization to use some network assets with five G. This is even more possible in that stat that you said there'll be onto more for Mark when you start a differentiation in services categories.

Thank you Alberto Leo we're going back to.

The audience, we have a few journalists here if they'd like to ask a question feel free to do it raising your hand, we'll have somebody there please identify yourself.

Good morning, this is but I'm not I'm not I'm at all I would like to ask two questions just to.

Understanding complementing diego's questions on cash flow.

Yeah.

Okay.

The April payments to only wouldn't influence your cash flow. So the expectation is that when you start having a positive cash flow for the second quarter and the second question is when we are indeed going to have the integration of <unk> systems.

Base.

Is it at.

At this very beginning and we're gonna have oi servicing you're right.

Uh huh.

Our generation of operational cash flow.

He is very positive because we have a abdomen minus capex, which is really strong in 2021, it was 24% in.

2022.

We have a few specifics fence more specifically at the boi payment and the.

What's what are the contributions of the funds.

And five G.

Which is the around the five for $5 8 billion for instance.

In terms of payment in 2022, but the company was already prepared for that so in 2020. One we finished with about a 10 nine to 10 billion.

That's a cash provision so when we see this negative cash flow actually.

So it's opened up a positive operate.

Yes.

Operational.

Operations and the company was already prepared for that and we already had the resources to for that so after we pay this will have a total.

Positive.

Operational so.

Of course, it happened because of extraordinary events.

Yeah.

Well talking a little bit about our integration labs.

Remember that we have two great phases. The first ones are not to wake integration that would come to home like and then we have the customer migration into teams.

So dealing etcetera, so we want to accelerate to did not work optimization and we expect to conclude it in three months.

<unk> that the deal was signed at the end of April and this phase. We first opened on that towards the oil cut customer can use the roaming at Tam remembering that.

Oh It was some vesting N and then.

Right so right now.

Tim customize the team only or customers not having access to Tim will cover the second phase we turn off.

And that's work and we're being there or is that sort of teams. So in this moment.

Customer or even customer started being completely embedded in the team base with any Peru enhancement in quality, because theyre going to be on the network with our biggest.

The highest.

Spectrum and four teams client also they also gain laterally with.

Coverage, we showed the graph and software all you want them to be warranted, but.

Tim client also will have a benefit on having a greatest spectrum and the higher quality. This period up to now where it could last three months, we have already started with our <unk>.

Our local called off of 119, what do which was the pilots we had extremely favorable results and I can say that the only client started receiving a different user experience both in coverage and quality.

We are now extending.

Local codes for local calls.

Uh huh.

Okay.

Jim on the on the local codes and towers that we Tim has acquired will have six months.

To implement the same way that we have to return some of this back to him because we did not buy 100% of the spectrum, we bought 55% of the spectrum.

After this first phase we entered the second phase, which is the system.

Customer migration are we gonna God I've got some from the billing system from.

And embed it into teams and the second phase should last for 12 months counting them starting in April where I would start first my grading their prepaid and control clients and then we move towards migrating to postpaid and the b to b clients. So.

Oh, the entire time frame between networks.

And his customer base, it's about tough months and was back to capture all the synergies not only.

By improving quality, but also having the practices of more for more delivering more qualities and services to our clients. So our next question.

The audience.

Please I mean, those who ask this as.

As well as identifying yourself. Please stand up otherwise we cannot show you into streaming so if we have any more questions from the audience.

Good morning, Andres Sally's from UBS I have two questions. The first.

It is about market as a whole.

How do you see the growth dynamics.

Off customer base in the mobile markets.

We saw this great growth in 2020, one that throughout the first quarter it slowed down at it.

Armed up.

But the second question is about how do you see your Capex dynamics.

That you guided for this year that so that's 1.3 capex this quarter, if we analyze its a little above all of the 4.8 that you had foreseen for 2022.

Let me answer the first one I'll do the second one on the simpler okay. The first the market dynamics, we're talking about a market that is mature.

Not a great growth in it.

What happened.

Condemning period.

Is that on one hand, we had a significant growth of prepaid.

Especially in 2020.

Related to the government grants to the lower classes.

But the it was say a moment our newest growth but it's.

Because if someone he changed.

Al.

There are.

The Sim card.

Second is our.

Concern too related to the business world the public sector there were several.

Several auctions in bids.

And somehow Lord.

Practically never strayed to enable too.

Sim cards for <unk>.

This does set for learning.

Yes.

So there was a lot of cars from our competitors.

To create this plans.

In the public sector and also partly in the private sector.

So it helped.

Part of the.

Growth in terms of.

Mobile number.

Yeah.

Some of these agreements are being.

Extended and others are being canceled.

Because the COVID-19 restrictions are eliminated.

So we've had a few elements that are specific from that moment that allowed this market growth.

If you see the Sim card ratio.

First one increase.

Do you see the business indicators, you don't notice the incrementals.

Oh of lines number.

So this will be a combo data is already being accommodated by because part of these contracts are automatically canceled in terms of the capital Capex question, when we see the quarter.

This is clearly a specific view of the moment. So we're not going to see if there's a capex for 2022 and this first quarter we have.

The two main drivers that are more intense now on the one side on the one hand five G that Leo.

We're going to.

Uh Huh and all capital.

And soon all the frequencies will be free and the integration capex and the preparation and integration with all of you.

These are the two main cost drivers that we have now.

In terms of the whole year guidance, we're not.

Going to spend more.

And then we said we would.

Let's move back to one more question from the platform. It comes from Daniele suddenly from credit Suisse. Good morning. Congratulations on the event was indeed very good I have two questions.

In a scenario of a an earlier adoption of five G. Compatible phones, you talked about 5 million of like to see the metrics for that is it EBITDA capex.

Well Daniel answering your question, explaining a little bit again, what we expect is efficiency because it depends on the increase of penetration. We have a network that is growing in terms of coverage. If we increase the use of this network removing the traffic pressure on the <unk>.

In regenerate is efficiency, we can focus our investments on five G and it's part of the weapon and we reduced the investments. Unfortunately.

Practically it will be a legacy that work when we talk about 600 million, we tend to capture that.

<unk> curve it will be increased capex until 2024.

He just adding.

Here too little explanation on that.

If we look at.

Yeah.

It happens and the commercial also assist help so if we look today at the curves that Leah showed the.

Five G penetration at the basis, 3%, but we are at the very beginning of this car. If so we need to wait till it up but we are above of what we had expected which was 2% at the lower end of the curve.

Another positive piece of news is that when we look at the terminals that we sold in our stores, we are almost at 70% of terminals that RFID.

As we launch five G. And then we're gonna have a half year of communication on the topic I don't know if anyone know everybody knows.

But.

We have the total mobile market, which is only 44% is in the hands of their carriers yet is how about other markets. So we are talking about five D and as we communicate.

It is probably low bad debt.

Consumers interest he's awake and so we're gonna have desktop terminals and we're gonna have a more aggressive penetration scenario as it had.

As it just had to work in other markets. It may actually take place here well Danielle.

I think we lost your second question sorry.

The best hit on this before another one for the platform. If it comes from Bruno Hayes I believe its worked really didn't have time to modify formerly the dividend policy is to have a higher return.

No. This is a notch up.

India to touch policy.

Oh, we you said are we had the practice of paying dividends the company would pay like half a billion in dividends up until 2017 or 27 16 in a very consistent way, but then when the company announced a new level off payment about 1 billion.

And it hasn't been quite consistent for the past four years keeping this level. So what we are doing here is that we are announcing any intention of changing the practice of dividend payment and we believe we're going to have the same frequency and reliability as we have done in the past four years, but it is not different.

Formal policy change.

Thank you Camilla to conclude our Q&A session.

Is there any other questions from the audience. Please stand up with his smartphones.

My name is consistent but that's the only from establishing.

You mentioned the possibility of consolidation in E S.

You also said that this is the idea of a priori priority that we have a priority on mobile synergies capture.

But I'd like to know if you can talk a little bit about more what you can see for regional providers, what you think about consolidation.

What kind of assets would have adequate profile to be in team's radar and the timing of those operations.

Well.

I'll begin and then I'll, let leila.

If you see the market structure.

We're usually the big National players and you have a group of regional players with.

Uh huh.

We have three zones.

With the different.

Actions in terms of footprint and then great the big Nationals.

Players.

Such as we do we work in big cap those in big cities and also the speed they build a market in the smaller municipalities and they manage to have a competitive protection putting fiber is the nearest neighbors didnt have fiber. So we have the big one.

And then Richard areas in the U S B.

So it's big.

Smaller municipalities of course, there are several overlapping areas.

Within the U S. B, we have a small I S. P would have.

No mature Isps.

They entered at whether our competition who integrate carriers.

Yes.

Yes.

These dynamics and that frees up capital.

Kept us from Isps.

Generated a certain.

Sure.

Oh harder competitive scenario.

Within a marketplace where.

You need to invest a lot to build the network and then you need to.

Best of luck to get clients.

It does.

And the competitive scenario.

<unk>.

It's more complicated forever, one from our point of view.

And changing a little bit from your question that you'd see.

More limited action in terms of footprint.

And with this the mobile operation with tends to coupon in the next few years to grow.

With a good trade off.

So the volume and value when you see the consolidation we see several movements.

More once becoming.

The mediums in the medium ones Amy operations.

It might happen from now on.

So this is a bit of the synergy that we see.

There are several peculiarities original peculiarities.

This is clear as our original players with the regional footprint.

And also they have a.

Does that dynamic between neutral networks and integrated.

Carriers so.

Yeah.

There is a geography size network or service for us.

We are.

Our carrier.

Within the big ones were the best footprint, we tend to have a consolidation in the future, but we need to have this commercial.

Thank you.

And the strategic photo focus so this happened this can happen.

Just.

Maintaining a bunch of words, it's in no way an extreme strategy shift to just another stab our strategy remains P. A.

And organic growth, mainly what we have observed just for M&A.

M&A take place when someone is willing to sell so we are not going to be the poachers and knock on E. S. P stores.

Asking to buy so the message here is that in the past we used to we saw situation that even though there was some seller selling an asset we would not to waste our time because.

The valuation did not made sense since he's a V. The failure that would cost us to build a base what we see today, our evaluations that are worth sitting down and run the math, but as a bunch of sad.

It's not us who are going to be knocking on yesterday's doors, we're going to react to market opportunities.

And do we need to have this opportunity of generating value because in this region, we have a relevant.

Base that allows us posted so and.

And upsell and that it can help us take us that within rationalizing the markets.

And then we can bring more profitability into this market from this market. So there is a set of factors that specific operations add to this opportunity approach can make sense to us.

And that can be something that we did not do you still think in the past and we're gonna start pay attention, but our focus on broadband is still organic growth.

Cool.

Well we've.

The longer Q&A than expected, but it would have to conclude I know there are few questions, especially from the platform that haven't been answered, but all of them will be answered later on with no we'd begin communications.

Process with old showed in Brazil in USA several conferences with the.

So we'll have all of this road shows.

And we will be available to answer all your questions and when possible, we will call out our executive team.

Jim to answer so I'll pass the floor to Alberto Thank you all for your participation.

I'd like to reinforce my acknowledgment to our team.

Here by my side. He is sitting in front of me we have the leadership team I'd like to think.

Everyone, who has been in our journey.

We're gonna have a road show, we're gonna have several opportunities of answering more questions and deepen into the siem.

We're going to have one to ones from now on it for the following week and thank you Tim Brazil.

[noise].

Yeah.

[noise].

Yeah.