TIM S.A.

Good morning, ladies and gentlemen, and welcome to TINASA 2024 Fourth Quarter Results video conference call. We would like to inform you that this event is being recorded and all participants will be in list and only mode during the company's presentation. There will be a replay for this call on the company's website. After TINASA remarks are completed, there will be a Q&A session for participants. At that time, further instructions will be given. Now, I'll pass the word to Vicente, head of IR. Please, go ahead, sir.

Hello and welcome to TeamSA's 4th Quarter 2024 Earnings Conference. I'm Vicente Ferreira, Head of Investor Relations. This video highlights our recent performance and the updated 3-year guidance. Afterward, we will have a live Q&A session with CEO Alberto Grizzelli and CFO Andrea Viegas. Please note that management may make forward-looking statements, and this presentation may contain them. Refer to the disclaimer on the screen and on our Investor Relations website. Now let's review our results.

Hello everyone, I'm Alberto Griselli, CEO of Team Brazil. I'm pleased to present to you a robust set of results in a dynamic year, when we overcame challenges and took advantage of our strengths to meet all of our targets. 2024 was marked by powerful cash generation, thanks to solid financial and operational results. We closed the year with service revenue growing 6.4% at the top of the guidance range. At this speed, we outpaced inflation even with a second half of tougher macro environment, an unfavorable comparison base. In the fourth quarter, service revenues grew 5.1%. Our revenues were driven by mobile services, which expanded by 6.6% compared to 2023. In mobile, highlighted the excellent performance of postpaid, rising close to 9% year over year. as a consequence of an expanding customer base with migration and a low churn of 0.7%. Our EBITDA ended 2024 increasing by 8% when compared to 2023, with another year of margin expansion. This shows the consistency and ability to operate efficiently. Our proxy for operating free cash flow grew close to 23% year over year, As a percentage of revenue, we reached more than 20% in 2024. Innovative offers, continuous infrastructure development, and service improvements supported these strong financial results. Behind our 3B strategy lays an idea of delivering what clients value the most. We are focused on providing exceptional customer value through network quality, affordability, and service excellence. Under best network, we focus on expanding 5G coverage across Brazil to migrate traffic and clients and start to impact clients' perception positively. We have more than 600 CD covers, 20% more than second player. As a result, 5G traffic has more than doubled compared to a year ago. For 2025, we will ensure consistency in network development while promoting the message of network quality leadership to consumers. The emphasis on technology innovation and network densification to address network gaps demonstrates a proactive stance in meeting customer needs and expectations as network quality becomes a core brand attribute. In Best Offer, 2024 was marked by innovation through content portfolio expansion while guaranteeing data monetization. We launched new concepts in postpaid and prepaid in parallel with turning an historical gap into a differentiation element. We expect to deepen our distinctiveness with digital ecosystem expansion and a renewed more-for-more approach. Innovation will again play a role in using next best action tools to personalize and revamp our prepaid go-to-market strategy. To deliver the best service during 2024, we use technology in our favor to maintain service quality indicators at the highest standards. Digitalization continues to be an important source of opportunities, and our new app should become a relevant driver for that change. In 2025, Customer Journey Evolution will continue aiming at reducing pain points and improving overall quality. A seamless experience in our digital channels, associated with Resolubility features and value-driven management of our clients, showcases Teams' dedication to providing tailored solutions that meet diverse customer needs. In recent months, we have seen growing concerns about Teams' ability to overcome challenges imposed by its mature peers and new entrants. but we are sure of our strengths in client attraction and retention, client monetization, and service and experience. TIM outpaced its peers, growing the postpaid base by 7.3% year over year, reinforcing the idea that net addition should be read relative to the size of the customer base and not only in the absolute number. We were the only large player to defend our market share in postpaid against the new entrants. As we've been explaining, nowadays this is primarily a game of migration and churn reduction. Thus, maintaining postpaid churn at low level is vital to have a strong client-based profile. Another area of clear strengths for TEAM is the monetization of its client base. We have the highest ARPU of the industry, above 31 reais, growing 6% versus 2023. To accomplish this, we combine more-for-more strategy plus upsell tactics to move clients up the ladder and cross-sell initiatives to expand our relevance in clients' pockets. Higher customer engagement also helps increase loyalty and consequently reduce churn. About 28% of our customers have more than one product. It is fair to say we have a diverse universe of metrics and sources when it comes to measuring care and service quality. There is the sector regulator, Anatel, private protection agencies like Reclamia Key, public consumer protection agencies such as ProCom and Consumidor.gov, and also internal metrics. When looking at the numbers from these different sources, it is clear the team has an outstanding resolubility being champion in most of them, solving the problem faster and according to clients' expectations. We still have room to improve when it concerns the number of complaints. We are the least complained about in some of these sources, but we have yet to close some gaps in others. Finally, we have the network evaluation. There is no doubt that TIM has the best network in Brazil. We start being present in more places than anybody else, both in 4G and 5G. And according to the recent report of OpenSignal, TIM was the most awarded operator in the mobile network experience report. We won seven out of 14 categories, leaving behind our peers. In this outstanding result, highlight that we are the number one operator in consistent quality for three years in a row. According to OpenSignal, this metric connects the most with clients' experience. The challenge we face for network, and you know well, is related to perception, but this is a marathon and not a sprint race. Consistency in having the best network metrics and consistency in communicating this leadership to consumers is essential. In sum, we have our strengths and work to ensure they remain a differentiating factor for teams. At the same time, we transform our weaknesses into opportunities to improve teams' overall operational performance even further. Now I will talk about areas of opportunity to generate new revenue streams. They are becoming more and more relevant to our mobile performance and this will be the case for 2025 and the years ahead. Throughout 2024, we were regaining momentum in the development of our digital ecosystem. Our 5G fund managed by Upload Ventures reached three investees, and more recently Minerva Foods became an LP. The arrival of a new major investor further strengthens the fund's pioneering performance within an innovation ecosystem. Customer platform projects are evolving accordingly and bearing fruits in different segments. In health, Cartao di Todos reached more than 160,000 families enrolled over the last six months. In education, Descomplica maintains a solid rhythm to reach 800,000 enrolments in courses. In digital and entertainment services, the EXA partnership reached an important milestone, with Team earning the right to subscribe to 27% of the company. Finally, our mobile ads and data monetization business rapidly expands as we integrate our proprietary inventory with Google and Meta and maintain a consistent rollout of Team Insights' new products. Another frontier for revenue growth is B2B IoT. Since the beginning of this project, we summed more than $700 million in contractor revenues. In 2024, we added $270 million in new contracts. Most of these contracts refer to three verticals. First one, agribusiness, where we have close to 20 million hectares covered with 4G. The second one, logistics, with highways representing most of the growth. And our coverage spans more than 5.6 thousand kilometers of roads. The third one, utilities, for which we sold more than 340,000 smart lighting units with connectivity services. During 2024, we focused on structuring sales processes and internal operations in a proactive approach to capturing market opportunities and becoming a reference among B2B clients of these verticals. For 2025, we need to further develop this opportunity, aggregating solutions and expanding our addressable market. We are working with a robust pipeline of prospective clients across various verticals, so the future looks promising. Now we move along to more financial details with our CFO, Andrea.