Telecom Argentina S A : Press Release 3Q22

Telecom Argentina

Press Release

3Q22 & 9M22

11-09-2022

Contacts:	Market Cap (NYSE: TEO): US$1,778.9 million*
Luis Fernando Rial Ubago
(5411) 5112 7218
Tomás Pellicori
(5411) 5524 7692

Telecom Argentina S.A.

announces consolidated results for the nine month period ("9M22") and third quarter of fiscal year 2022 ("3Q22") **

Note:For the figures included in their FFSS, the Company has accounted for the effects of inflation adjustment adopted by Resolution 777/18 of the Comisión Nacional de Valores ("CNV"), which establishes that the restatement will be applied to the annual financial statements, for intermediate and special periods ended as of December 31, 2018 inclusive. Accordingly, the reported figures corresponding to 9M22 include the effects of the adoption of inflationary accounting in accordance with IAS 29. Finally, comments related to variations of results of 9M22 and vs. 9M21 mentioned in this press release correspond to "figures restated by inflation" or "constant". Moreover, Table 3contemplates information broken down by segment for periods ended as of September 30 of 2022 and 2021, as analyzed by the Executive Committee and the CEO, who receive periodically the financial information of Telecom and its subsidiaries (in historical values). For further details, please refer to the titles of the financial tables beginning from page 11.

• Previous' year figures included for comparative purposes (September 2021) contain the effect of the year over year inflation as of September 2022, which was 83.0%.
• Consolidated Revenues amounted to P$470,960 million in 9M22 (-12.2% in constant currency vs. 9M21), in a context of inflationary acceleration. Service Revenues totaled P$440,369 million (-11.6% in constant currency vs. 9M21).
• Mobile clients in Argentina reached 20 million in 9M22 (+0.5 million vs. 9M21), cable TV subscribers totaled approximately 3.5 million (-61 thousand vs. 9M21), while broadband accesses amounted to 4.2 million (-30 thousand vs. 9M21).
• Operating Income before Depreciation and Amortization amounted to P$135,138 million in 9M22 (-22.6% vs. 9M21), while our operating margin before D&A was 28.7%.
• Due to economic and market conditions, a goodwill impairment of P$207.940 million was recorded as depreciation, amortization and impairment of fixed assets (refer to the "Impairment of goodwill" section of this press release), mainly including the goodwill generated as a result of the merger between Cablevisión and Telecom (which was effective as of January 1, 2018). The aforementioned impairment does not affect assets other than goodwill and has no impact over the Company's operations or its cash generation capacity.
• The Company registered a Net Loss of P$163,498 million in 9M22 (vs. an income of P$1,876 million in 9M21). This loss was mainly due to the abovementioned impairment and was partially offset by positive net financial results of P$75,126 million.
• Investments (including rights of use assets) reached P$85,664 million in 9M22, equivalent to 18.2% of our Consolidated Revenues.
• Net Financial Debt amounted to P$360,531 million in 9M22 (-11.8% in constant currency vs. 9M21).

*Market Cap as of November 8th, 2022

**Unaudited non financial data

TELECOM ARGENTINA	1

	IAS 29	IAS 29
(in million P$ adjusted by inflation, except where noted)**	As of Sep-30,	As of Sep-30,	$	%
	2022	2021
Consolidated Revenues	470,960	536,247	(65,287)	-12.2%
Operating Income before D&A	135,138	174,607	(39,469)	-22.6%
Operating Income (loss)	(234,668)	2,169	(236,837)	-
Net income (loss) before income tax expense	(159,200)	58,542	(217,742)	-
Net income (loss) attributable to Controlling Company	(164,873)	655	(165,528)	-
Shareholders' equity attributable to Controlling Company	690,897	887,412	(196,515)	-22.1%
Net Financial Debt	(360,531)	(408,918)	48,387	-11.8%
Investments in PP&E, intangible assets & rights of use assets *	85,664	121,750	(36,086)	-29.6%
Fixed lines in service (in thousand lines) ***	2,030	2,524	(494)	-19.6%
Mobile customers (in thousand)	22,339	21,722	617	2.8%
Personal (Argentina)	19,997	19,522	475	2.4%
Núcleo (Paraguay) -including Wimax customers-	2,342	2,200	141	6.4%
Broadband accesses in Argentina (in thousand)	4,218	4,248	(30)	-0.7%
Pay TV Subscribers (in thousand)	3,500	3,561	(61)	-1.7%
Average Billing per user (ARPU) Fixed Telephony / voice (in P$ - Restated by inflation)	1,206.6	1,296.2	(89.6)	-6.9%
Average Revenue per user (ARPU) Mobile Services - Personal (in P$ - Restated by inflation)	936.5	1,039.6	(103.1)	-9.9%
Average Revenue per user (ARPU) Broadband (in P$ - Restated by inflation)	2,642.0	2,892.8	(250.8)	-8.7%
Average Revenue per user (ARPU) Cable TV (in P$ - Restated by inflation)	2,620.9	3,201.6	(580.7)	-18.1%

• (in constant measuring unit - includes $10.779 million corresponding to additions of rights of use assets as of September 30, 2022) **(Figures may not add up due to rounding)
• (does not include IP telephony lines, which as of September 30, 2022 amounted to approximately 1,020 thousand)

	Consolidated Revenues					EBITDA
	(in million P$)						(in million P$)
			536,247			33.5%			29.0%			32.6%	28.7%
			470,960
		370,586		100,574											174,607
258,138		278,109
													135,138
												107,497			88,094
						86,513					27,641
	9M21	9M22	9M21	9M22
				9M21	9M22	9M21		9M22
			IAS 29	IAS 29
												IAS 29		IAS 29
		IAS 29 Adjustment (Inflation)							EBITDA Margin
	EBIT								Net Income (Loss)
	(in million P$)							(in million P$)
49,076	62,298													1,876
	2,169
					(2,647)
			(46,907)
				(234,668)								(61,564)
				(296,966)
																(163,498)
	9M21	9M22	9M21	9M22				9M21	9M22	9M21		9M22
			IAS 29	IAS 29
												IAS 29		IAS 29
		IAS 29 Adjustment (Inflation)

TELECOM ARGENTINA	2

Buenos Aires, November 9, 2022 - Telecom Argentina S.A. ('Telecom Argentina') - (NYSE: TEO; BYMA: TECO2), announced today a net loss of P$163,498 million for the period ended September 30, 2022 (-P$165,374 million vs. 9M21). The net income attributable to the controlling company was P$164,873 million (-P165,528 million vs. 9M21).

Comparative figures for the previous fiscal year have been restated so that the resulting information is presented in terms of the current measurement unit as of September 30, 2022.

The following table shows the evolution of the consumer price index (National CPI - according to INDEC's official statistics) for the last two fiscal years and as of September 30, 2021 and 2022, , which were used to restate the figures in constant currency:

		As of December 31.	As of December 31.	As of September 30.	As of September 30.
		2020	2021	2021	2022
	Price Index Variation	36.1%	50.9%	52.5%	83.0%
	Annual
	3-month cumulative	n/a	n/a	9.3%	22.0%
	(since June)
	9 month cumulative	n/a	n/a	37.0%	66.1%

During the 9M22, Consolidated Revenues amounted to P$264,577 million, from which Service Revenues totaled P$247,527 million.

	IAS 29	IAS 29	$	%
	9M22	9M21
Consolidated Revenues (MMP$)	470,960	536,247	(65,287)	(12.2%)
Net Income (loss) attributable to Controlling Company (MMP$)	(164,873)	655	(165,528)	-
Net income (loss) attributable to Controlling Company per Share (P$)	(76.6)	0.3	(76.9)
Net income (loss) attributable to Controlling Company per ADR (P$)	(382.8)	1.5	(384.3)
Operating income before D&A *	28.7%	32.6%
Operating income (loss) *	-49.8%	0.4%
Net income (loss) *	-34.7%	0.3%
*As a percentage of Consolidated Revenues
Note: The average of ordinary shares outstanding considered amounted to and 2,153,688,011 as of 9M22 and 9M21

Consolidated Operating Revenues

Mobile Services

As of September 30, 2022, total mobile subscribers in Argentina and Paraguay amounted to 22.3 million. In 9M22, total mobile services revenues represented P$187,113 million (-P$13,590 million or -6.8% vs. 9M21).

Mobile Services

Revenues

(in billion P$)

					200.7	187.1
					104.0	39.8
96.7		147.3
	9M21		9M22		9M21		9M22
						IAS 29		IAS 29
				IAS 29 Adjustment

TELECOM ARGENTINA	3

Mobile Services in Argentina

As of September 30, 2022, total mobile subscribers amounted to approximately 20.0 million (+0.5 million vs. 9M21). Postpaid clients represented 43% of our subscriber

Mobile Consumption of Personal in Argentina

base.

4,306

5,052

In 9M22, mobile service revenues in Argentina amounted to P$171,114 million (-4.6% vs 9M21). Mobile internet revenues accounted for 88% of mobile service revenues. The average monthly revenue per user ("ARPU" - restated in constant currency as of September 30, 2022) amounted to P$936.5 during 9M22 (-9.9% vs. 9M21). The effect generated by the restatement in terms of the September 30, 2022 current measurement unit (included in the ARPU) amounted to P$194.8 and P$537.4, for 9M22 and 9M21, respectively. Mobile churn was 2.5% (vs. 1.6% in 9M21).

1,040937

9M21 9M22

ARPU ($/month)

MBOU(monthly)

Personal in Paraguay ('Núcleo')

As of September 30, 2022, Núcleo's subscriber base reached 2.3 million clients. Prepaid and postpaid customers represented 80% and 20%, respectively.

Núcleo´s mobile service revenues during 9M22, amounted to P$15,999 million (-24.9% vs. 9M21), mainly due to a decrease in ARPU measured in constant pesos, which was partially offset by the appreciation of the Guaraní against the Argentine peso.

Cable TV Services

Cable TV service revenues were P$85,700 million in 9M22 (-P$19,420 million or -18.5% vs. 9M21). Cable TV subscribers totaled approximately 3.5 million (-61 thousand vs. 9M21). The monthly Cable TV ARPU (restated in constant currency as of September 30, 2022) reached P$2,620.9 during 9M22 (vs P$3,201.6 in 9M21). The effect generated by the restatement in terms of the measuring unit as of September 30, 2022 included in ARPU amounts to P$567.4 and P$1,663.9, for the 9M22 and 9M21, respectively. The average monthly churn during 9M22 and 9M21 was 1.3% and 1.1%, respectively.

Flow continued to strengthen its content offer by incorporating new products in music, national and international films, and gaming. During the 9M22, Flow's subscribers reached 1.3 million (+200 thousand or +18.3% vs. 9M21)

Additionally, we continued to deploy the ISDB-T technology for analogic Flow subscribers in new cities, reaching more than 1.5 million subscribers in the Autonomous City of Buenos Aires and the province of Buenos Aires. We have also presented a new Flow Flex service, which consists of a flexible paid TV proposal that allows customers to contract Flow's services for a fixed period of time, with packages of 3, 7, 15 and 30 days.

Pay TV Service

Revenues (in billion P$)

				105.1
						85.7
				54.6	18.2
50.5	67.5
	9M21		9M22		9M21		9M22
					IAS 29		IAS 29

IAS 29 Adjustment

TELECOM ARGENTINA	4