Telefônica Brasil S A : Corporate Presentation | Nov-20

11/09/2020 | 09:02am EDT

Corporate Presentation

Telefônica Brasil S.A. Investor Relations

N o v e m b e r , 2 0 2 0

Vivo is the market leader in Brazil and has the best assets to capture growth opportunities and generate even higher returns

	▪ Perspectives of economic recovery after Covid-19 shock
Outlook	▪ Regulatory framework modernization through Law 13.879
▪	Telecom Market: significant opportunities in fiber, mobile, and

digital services

	▪ 60% of fixed revenues are composed of growing businesses
Growth	▪ Fiber deployment continues at full speed
▪	80% of MSR from postpaid customers, with leadership reaffirmed

▪ Multiple initiatives in the digital space

Resilient revenue base with

positive outlook for the

future

Efficiency and

Returns

Digitalization and simplification driving resilient EBITDA
Smart capex allocation improving returns
Strong FCF generation, even with solid investments, supporting higher shareholder remuneration

Strong FCF and Net

Income evolution

	▪ One of the top 10 companies in the new S&P/B3 Brasil ESG Index
ESG	▪ Conversion of Preferred Shares into Common Shares underway¹
▪	Winner of UNESCO's Hamdan Prize for teacher effectiveness

▪ Recognition of Vivo as one of 150 best places to work in 2020²

Consistent focus on ESG

1 - Unification of share classes approved by the Extraordinary Shareholder Meeting and Special General Meeting of Preferred Shareholder. 2 - According to Great Place to Work®

Economic recovery and positive evolution of the regulatory framework will enable Vivo

to unlock significant value

OUTLOOK

Key economic drivers

Economic activity recovers as a result of the flexibilization of isolation measures, along with the government's financial aid
Record low interest rates with inflation forecasts below target
Economic reforms are underway to address fiscal risks

Outlook1 of economic recovery after Covid-19 shock

	19A	20E	21E	22E	23E
GDP Growth %	1.1%	-4.8%	3.4%	2.5%	2.5%
CPI %, EoP	4.3%	3.0%	3.1%	3.5%	3.3%
Exch. rate R$/US$	4.0	5.4	5.2	4.9	4.9

Positive evolution of the sector's regulation

New law 13.879 will allow fixed voice concessionaires to migrate to an authorization framework, incentivizing investments in modern technologies
Companies will be able to significantly reduce their legacy spend and focus their capital on up-to-date, future-proofsolutions
Law 13.879 is also important for the mobile business, as it permits the automatic renewal of spectrum
The 5G spectrum auction is likely to focus on coverage obligations and expected to take place by the end of 1H21

1 - Source: Banco Central's Focus Bulletin - October 23, 2020.

The market is witnessing positive trends across key segments, in which Vivo is the leading operator in Brazil

OUTLOOK

Key market trends

1	Accelerated FTTH expansion
UBB will maintain a double-digit growth in the coming
years, driven by low penetration (31%)1

2	Market consolidation
Improving competitive scenario, capital intensive market
	and fragmented FBB players
3	Preparation for 5G
5G DSS already launched in some cities. Kick-off of the
	5G era in Brazil with the spectrum auction in 2021
4	Focus on new revenue streams
Aiming to play a role in Digital Services, telcos will
	expand their reach

5	IoT massification
IoT will gain traction in Brazil, mainly in fleet
	management, agro, smart building and smart cities

Key metrics

Vivo Accesses Market Share

September/2020

Mobile	Broadband	Pay TV
33.6%	18.6%	8.4%
76.7 mn accesses	6.4 mn accesses	1.3 mn accesses
Postpaid	FTTH	IPTV
38.3%	21.0%	80.2%
44.0 mn accesses	3.1 mn accesses	0.9 mn accesses

1 - Penetration over ABC households and B2B.

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Telefônica Brasil SA published this content on 09 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 November 2020 14:01:05 UTC

TELEFÔNICA BRASIL S.A.

Telefônica Brasil S A : Corporate Presentation | Nov-20

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