Telecom ArgentinaTelecom Argentina

FullFull--YearYear 2014 2014 PreliminaryPreliminary ResultsResultsFullFull--YearYear 2014 2014 PreliminaryPreliminary ResultsResults

Conference Call Presentation

This presentation may include statements that could constitute forward-looking statements, including, but not limited to, the Company’s

expectations for its future performance, revenues, income, earnings per share, capital expenditures, dividends, liquidity and capital structure;

the impact of the emergency laws enacted by the Argentine government; and the impact of rate changes and competition on the Company’s

future financial performance. Forward-looking statements may be identified by words such as “believes”, “expects”, “anticipates”, “projects”,

“intends”, “should”, “seeks”, “estimates”, “future” or other similar expressions. Forward-looking statements involve risks and uncertainties that

could significantly affect the Company’s expected results. The risks and uncertainties include, but are not limited to, uncertainties concerning

the impact of the emergency laws enacted by the Argentine government which have resulted in the repeal of Argentina’s convertibility law, the

devaluation of the peso, restrictions on the ability to exchange pesos into foreign currencies, the adoption of a restrictive currency transfer

policy, the “pesification” of tariffs charged for public services, the elimination of indexes to adjust rates charged for public services and the

executive branch announcement to renegotiate the terms of the concessions granted to public service providers, including Telecom. Due to

extensive and rapid changes in laws and economic and business conditions in Argentina, it is difficult to predict the impact of these changes on

DisclaimerDisclaimer

1

extensive and rapid changes in laws and economic and business conditions in Argentina, it is difficult to predict the impact of these changes on

the Company’s financial condition. Other factors may include, but are not limited to, the evolution of the economy in Argentina, growing

inflationary pressure and reduction in consumer spending and the outcome of certain legal proceedings. Readers are cautioned not to place

undue reliance on forward-looking statements, which speak only as the date of this document. The Company undertakes no obligation to

release publicly the results of any revisions to forward-looking statements which may be made to reflect events and circumstances after the

date of this presentation, including, without limitation, changes in the Company’s business or to reflect the occurrence of unanticipated events.

Information included in this presentation is unaudited and may not coincide with that included in the financial statements of the Company, due

to rounding, reclassification matters, and other reasons. Readers are encouraged to consult the Company’s Annual Report and Form 20-F as

well as periodic filings made on Form 6-K, which are filed with or furnished to the United States Securities and Exchange Commission and the

Argentine Comisión Nacional de Valores.

AgendaAgenda

Market Overview

Business Highlights

Financials

2

Financials

Q&A

Retail & Wholesale commerce

Financial interm.

Manufacturer Industry

Transport & Communications

Real Estate

Agriculture

Construction

Minery

Public Admin & Defense

Social services & Healthcare

Electricity, gas & water

8.6%

0.9% 2.9%

0.1%

2011 2012 2013 2014e

∆ YoY - constant prices

10.012.2

8.06.7

Trade Balance (Billion US$) Last 12 months

51.944.1 45.7

29.7

2011 2012 2013 2014e

Consumer Confidence Index of Durable Goods

46.4 43.3

30.6 31.4

29.4%24.5% 25.9%

33.9%

Central Bank Reserves (Billion US$)National Wages - ∆ % YoY

Economic activity per sector Wages Central Bank Reserves

Economic outlook: Economic outlook: ““Activity + Imports restriction + Reserves”Activity + Imports restriction + Reserves”

Real GDP* CCI Trade Balance

Total

2011 2012 2013 2014e 2011 2012 2013 20142011 2012 2013 2014e

� A depreciated Brazilian currency combined with

an appreciated AR$/U$S in real terms affected

the Argentine external competitiveness, thus

impacting industrial exports

� The January 2014 devaluation, that affected

local consumption, and the tax hike on the

automobile sector had an important effect on

the industrial activity

� A weak economic activity was registered in

2014: +0.8% in 1Q14, +0.0% in 2Q14 and -0.8% in

3Q14 YoY. It is expected +0.1% in GDP growth for

full 2014, a significant slowdown from +2.9% in

2013

3Source: MECON, INDEC and Company Estimates

*Official GDP YoY variation, constant prices

� Private consumption showed a weak evolution

in 2014 due to a reduction in real wages and a

more restrictive consumer credit environment

� Investment was significantly impacted, reflected

in a lower production of durable goods, as a

consequence of tighter restrictions on imports of

capital goods

� The new CPI Index published by the government

reached 23.9% YoY, stabilizing in a level of aprox.

1.1% per month during 4Q14

� During 4Q14 the government implemented new

measures to increase CB Reserves: currency

swap with China, loans from French CB and the

payment of spectrum auction

� As of December 2014, CB Reserves showed an

increase of +3% YoY, but suffered a strong

reduction in the first 9M14

� Continuous government monitoring of the FX

market aimed at dampening expectations of

devaluation of the peso

� Trade balance showed a decrease in FY14 due to

the weaker demand from the main commercial

partners, lower prices of commodities, while

increasing energy imports

AgendaAgenda

Market Overview

Business Highlights

Financials

4

Financials

Q&A

� Internet Mobile users +15% YoY (Usage +69%, ARPU+31%)

� Broadband wireline subs +4% YoY (10 Mb subs 16% of CB vs. 7% in

4Q13)

� Spectrum Auction payment: the equivalent of US$410.7 million for

the remaining 3G bands to complete 50MHz Cap and for AWS bands

� Aggressive 4G rollout plan:

� Competitive advantage in AWS Spectrum

� 180 sites (8 cities) in one and a half month

85% of population in 2 years

Business HighlightsBusiness Highlights

Business

� 85% of population in 2 years

5

Financials

� Revenues up +22% driven by:

� Mobile internet in Argentina (+60%) due to increase in

unique users, usage and ARPU

� Data (+53%) and Broadband (29%) in the Fixed Business

� Constant efforts in costs efficiencies to mitigate the effects of the

inflationary context

� Quarter YoY OIBDA Margin increase (+0.6 pp)

27,287 340 507733 -27 580 454 1,247

1,794 426 33,341

IFRS, Million of AR$, Percentage

Consolidated revenue growth fostered by Data, Internet & HandsetsConsolidated revenue growth fostered by Data, Internet & HandsetsEvolution of revenues FY13 – FY14

YoY

Variation +10% +53% +9% +6% +60% +57%

+6,054; +22%

+29% -34% +37%

MOBILE IN ARGENTINAFIXED NUCLEO

SMS-257MM; -5%

Impact of billing per second

FY13

Revenues

Voice Data Internet Equipments Voice Data Internet Handsets Nucleo FY14

Revenues

6

Note:

*Paraguayan (Nucleo S.A.) revenues expressed in AR$ and includes handsets.

Figures might not sum up due to rounding

0%10% 23%4% 10%% of total

Revenues15%

Variation +10% +53% +9% +6% +60% +57%+29% -34% +37%

11% 22% 5%

Mobile Mobile –– New Offers continue to show encouraging trendsNew Offers continue to show encouraging trendsPostpaid

Prepaid

131.8169.4

4Q13 4Q14

Postpaid

ARPU4

+29%

AR$/Month

Results of DIA FULL� Stabilizing CB� ARPU accretive� ~50% of Gross Adds in Dec 2014

Black

Other

Postpaid

7

38.6

40.5

4Q13 4Q14

Prepaid

ARPU4

AR$/Month

+5%

PrepaidResults of Superchip� Stabilizing CB� Expanding frequent users� Increase Usage of Voice & Data� Increase averagerecharge

Market share (%)2 33.1%33.0%

Postpaid Subs (%)132%32%

4Q14

Customer Base (Mln) 19.620.1

7.76.7

4Q 134Q 13 4Q14

1) Includes “Cuentas Claras” subscribers2) Market estimates of the top 3 providers in the industry – Exclude trunking services3) Monthly unique Internet Users4) Includes Dongles

Internet Users(Mln)3

Customers Prepaid recharges <30 days Customers Prepaid recharges <30 days

Dec 13 Dec 14

oct nov dec

Mobile Argentina Mobile Argentina –– Growth of mobile internet Growth of mobile internet

CUSTOMER

49.6

178.5

81.1

308.8

FY13

FY14

USAGE ARPU

Data Usage (MB/month)

35.2

46.1

4Q13 4Q14

Browsing ARPU (ARS/month)Internet Users (Monthly unique users)

6.77.7

4Q13 4Q14

GROWTH ENABLERS

Prepaid Postpaid

+15%+31%

4Q 13 4Q14

8

27%37%

4Q13 4Q14

S-phone

Penetration/CB S-phone

SelloutSpectrum ResourcesSectors / Mobile sites

Sites +12%

Sectors +35%

43 50

30

Pre auction Post auction

2G/3G* 4GBlack

Other

Postpaid

Prepaid

UNLIMITED

BUNDLE

x DAY

Price Schemes

Share

Data

Plans

Premium

Content

GROWTH ENABLERS

HANDSETS NETWORK OFFERING

73%91%

4Q13 4Q14

* Pre spectrum auction: North: 45 MHz, AMBA: 42.5 MHz and South: 40 MHz. Post spectrum auction: 50MHz per region

Mobile Mobile –– 4G competitive edge4G competitive edge

�� 44GG RollRoll OutOut

� 1H15e: 300 new sites

� InitialInitial NetworkNetwork RolloutRollout::

More than 180 sites

installed in:

� Buenos Aires

� Córdoba

� Rosario

� Salta

� Santa Fe

� Tucuman

� summer resorts

�� NetworkNetwork ModernizationModernization

Within 18 months:

� Single RAN in ~100% of sites

� High Speed backhauling in ~100% of

sites

Competitive advantage in Competitive advantage in

AWS SpectrumAWS SpectrumOutstanding Results in the Outstanding Results in the

first Launchfirst LaunchAn aggressive plan to surf An aggressive plan to surf

the wavethe wave

� 1st frequency 3G and AWS bands: allocated

in November and paid in December –

equivalent to U$S410.7 million

� 2nd frequency allocation 700Mhz to be

determined

9

� 1H15e: 300 new sites

� Capital and main cities in 18 months1

� 85% of population in two years1

Average UL & DL Speed

1.1 5.9

25.835.3

UpLink (mbps) DownLink (mbps)

3G

4G

AWS already assigned

700 MHz to be assigned

� summer resorts

�� 33GG EmpowermentEmpowerment

� New Spectrum usage

� +15% access nodes

�� HandsetsHandsets

� >1 Mn. 4G Smartphone and Tablets

� CustomersCustomers

200k customers can

experience the service

with no needs to

change SIM card

Note: 1 Taking into consideration the effective assignation of the 700 MHz spectrum.

178

Oct Nov Dec

1,707 1,714 1,726 1,750

1,771

4Q13 1Q14 2Q14 3Q14 4Q141.3% 1.3% 1.4% 1.3% 1.2%

134.0138.0 147.9 157.8 167.3

4Q13 1Q14 2Q14 3Q14 4Q14

Monthly

Churn

ARPU (AR$)

Fixed Fixed -- Growth of BB/UBB thanks to service provisioning and competitive offerGrowth of BB/UBB thanks to service provisioning and competitive offer

Thousand of broadband accesses, thousand of net adds

+25%

+64k; +4%

AR$/Month

BBAccesses

BB ARPU & Churn

>10Mb

% of CB 16%13%10%8%7%

40%44%

4Q13 1Q14 2Q14 3Q14 4Q14e

4Q13 1Q14 2Q14 3Q14 4Q14

583 735

963

1,470

FY11 FY12 FY13 FY14

10

IFRS Million of AR$

+26%

+53%

4Q14e: Market estimates of the top 3 providers in the industry

BBFlow share

Data Revenues

% of CB 10%8%7%

+31%

4Q13 1Q14 2Q14 3Q14 4Q14

3,530

15%

11%

19%

7%

48%

Fixed

Access

Core &

Infraest. 1

IT

Others &

Spectrum

Mobile Access

CapexCapex -- Focus on BB and UBB Fixed and MobileFocus on BB and UBB Fixed and Mobile

Capex Evolution

8,957

Spectrum

FTTx Rollout

+3x

Carriers

3,192 3,257

4,851 5,427

FY11 FY12 FY13 FY14

Note: 1Core & infrastructure refers to network related capex, including quality and innovation capex.

Million of AR$

11

% Revenues 15% 18% 16%17%

+12%

27%

+49%

Incl. spectrum payment

+2%

3Q13 4Q13 1Q14 2Q14 3Q13 4Q14

+33%

AgendaAgenda

Market Overview

Business Highlights

12

Financials

Q&A

Personal – Mobile 70%

5,993 6,570

1,799 2,112

1,825 2,007

1,930 2,067

2,010 2,516

FY11 FY12 FY13 FY14

7,114

8,598

7,460

9,158

OIBDA

Margin 32%

TEO Group: Consolidated Results TEO Group: Consolidated Results

IFRS, Million of AR$, Percentage IFRS, Million of AR$, Percentage

30% 28% 26%

+22%

+15%Revenues

OIBDA*

+20%

+10%

Fixed Business 15%

Broadband 10%

Nucleo – Mobile 5%

1Q

2Q27,287

33,341

+17%

+10%

7,564

8,702

3Q+21%

3Q+7%

+23%4Q

+23%

+25%+15% 4Q% of Revenues

27.5%

18,498 22,117

6,064 7,466

6,649 8,119

FY11 FY12 FY13 FY14

13

Regulated

Revenues 12% 10% 8% 7%

*Operating Income Before Depreciation & Amortization

1Q

2Q

+23%

+22%

-491-55

900

116 149198

437

FY12 FY13 FY14 1Q14 2Q14 3Q14 4Q14

Handsets Revenues – Costs

(in million of AR$)

Before capitalization of SAC & SRC

5.0%

18.2%

30.8% 27.5%

FY13 FY14

Handset

Margin

SS Revenue

Margin

Handset Margin - Mobile in Argentina

12% 15%Handset rev.

% of revenues

7,564 4,250

1,788

1,032245 1,439

608427 692 228 229 8,702

18%

55%

33%

13%

35%23%

15%

26% 32%

13%

YoY

Variation

TEO Group: Consolidated TEO Group: Consolidated costs costs and OIBDA evolutionand OIBDA evolution

IFRS, Million of AR$Operating Income Before Depreciation and Amortization FY13 – FY14

+1,138; +15%

756One-off Event;

AR$ 115 MM YE Bonus

18%13%

23%15% 13%

OIBDA FY13 Ss. Revenues &

other incomes

Handsets

Sales

Handsets Costs ITX Costs Labor Costs Taxes Other

Marketing &

Sales

Fees for

services, maint.

and materials

VAS Costs Others* OIBDA FY14

14* Others includes bad debt expenses, provisions, recovery (costs) restructuring and others

OIBDA Margin

-1.6%+0.5% -0.1% +0.6% -0.3% -0.2% 26.1%+0.5%27.7%

� Service OIBDA margin: 27.5% in FY14

� Fifth quarter in a row with positive margin in handsets business, improving the mix revenues

� Labor Costs includes an extraordinary bonus payment to employees for AR$ 115 MM. Excluding this effect, Labor Costs in FY14 vs. FY13 would

have increased +32% YoY

-1.0%

-0.5%+1.0% -0.7% +1.3% -0.2% -1.1% 27.7%+0.4%29.7% -2.2%

FY14

FY13

FY13

FY12

11%

23%

22%

37%

21%

9%

22%

35%

33%

12%

18%

30%

36%

39%

21%

Fees for services,

maint. and materials

Other Marketing &

Sales

Taxes

Labor Costs

ITX Costs

Handsets Costs

Revenues & Other

Income

3Q14 4Q14Results on OIBDAResults on OIBDA

YoY OIBDAgrowth

14%

25%

2%

35%

Others

VAS Costs

15

1Q14 2Q14 3Q14 4Q14

15

10.0%17.4%YoY

Growth7.1% 25.2%

Actions Items:

� Full impact price increase in 4Q14 (~14%)

� Appealing commercial offers (“Super Chip” & “Full

Day” packs) to enrich value proposition

� Constant efforts in costs efficiencies to mitigate the

effects of the inflationary context

-2.7pp-1.4ppΔ YoY

OIBDA

margin

-3.1pp +0.6pp

2,685 916

870 839

878

1,029

3,857 3,966

945

1,241

1,203

1,225

1,255

1,600

TEO Group: Consolidated ResultsTEO Group: Consolidated Results

IFRS, Million of AR$, Percentage

+3%

+20%

IFRS, Million of AR$, Percentage

Net Income attributable to Telecom

+7%

+15%

2Q

Operating Income

+31%

4,518

5,443

3,202

3,673

2Q

+2%3Q

3Q-4%

+27%

4Q

+14%

+19%+17%

4Q

in million of AR$ FY13 FY14

Net Interests $ 632 $ 265

Gains on Mutual Funds &

other inv.$ 124 $ 289

FX results -$ 279 -$ 178

Results on NDF $ 55 -$ 97

Others -$ 4 -$ 26

Total $ 528 $ 253

2,513 2,685

802 889

652 916

FY11 FY12 FY13 FY14

1,115 1,377

945

FY11 FY12 FY13 FY14

16

O. Income

Margin21% 18% 14% 12%17% 16% 12% 11%

+11%

Net Income

Margin

1Q+23%

+40%

1Q

2Q

� Net Income in FY14 and FY13 includes AR$25 and AR$187 Million charge related to disposal of PP&E respectively. Excluding this effect, Net

Income in FY14 vs. FY13 would have increased +11% YoY

5,354

1,610 2,277

3,530538

3491,299

745

IFRS, Million of ARS - Last 12 months

TEO Group: TEO Group: FCF, Net FCF, Net Financial Financial Position & Hedging StrategyPosition & Hedging Strategy

Telecom Argentina 219(1)

Telecom Personal 693

Nucleo (Paraguay) (167)

Operating free Cash Flow

Net Financial Position

Free Cash Flow

8,702 5,427 1,665

OIBDA Capex Δ WK & others

Net Financial

Position

FY13

(Net Cash)

Net Financial

Position

FY14

(Net Cash)

Net Interest

& OthersFX

Variations

Operating

Free Cash

Flow2

Taxes Dividend

Payments3

Spectrum

Payment

17

Note:

(1) Includes Telecom USA

(2) OFCF: Operating Free Cash Flow before Taxes

(3) Includes $53 Million related to Nucleo dividends payments to third parties, net of income tax

Nucleo (Paraguay) (167) Free Cash Flow = -667

387

2181 149

136

In U$S million, December 2014. Argentine operations

U$S Dollar

Linked NDFFX Cash Exposure as

of FY14

65%Coverage

Net Payables in

Foreign

Currency

(Net Cash) (Net Cash)

� Higher impact in FCF for capex

payment in FY14

� AR$3,530 MM paid for Spectrum

Auction

� Strong increase in mobile devices

financing to customers

�Net payables in FX: 65% of hedge

after spectrum auction payment

HEDGING STRATEGY

AgendaAgenda

Market Overview

Business Highlights

18

Financials

Q&A