Results PresentationTIM Participações S.A.

Q3 in Few

2

Total Net Revenues(R$ Billion)

EBITDA(R$ Billion)

4.7

3Q11 3Q12

4.4

1.161.20+3.8%

Solid data growth (Revenues +35% YoY)

Smart/webphonesales pick-up

Sales resilience in spite of sales ban

MOU at record level of 139

Live TIM up and running

Postpaid human at 24% YoY growth

A tough quarter, but TIM is managing to recover

MTR cut impact

Provisioning of advertisement credit loss (R$16 mln)

Provisioning for administrative procedures established between 2007/09 (R$26 mln)

Intelig fixed business performance

13.7

9M11 9M12

12.4

1.11.2

+8.0% +11.0%

3Q11 3Q12 9M11 9M12

19.1%7.0% 8.0%

+7.5%

3.34

3.58+7.3%

+8.6%

Quarter’s Highlight

12.6%6.0% 7.5%

1Q12 2Q12 3Q12

1Q12 2Q12 3Q12

Revenue Growth

Organic EBITDAGrowth

R$ 42mln1.24 3.63 R$ 42mln

Institutional Investor

“Best IR Team”

Frost Sullivan

Best Practices

Award

AbrascaPrize of Value

Creation

Reality Check: Recent Events Overshadowing Fundamentals

Sales Ban Drop Call Report Tax Issue ContingencesImpacts:

Reduction in gross adds during the period

Small economic impacts

Damage on image

Status:

Ban lifted on 3rd of August

Anatel is measuring the evolution of the plan.

Impacts:

Damage on image

Status:

Two independent consultants firms concluded that the rate of dropped calls on 3/8/12 showed no anomalies

Anatel’s final decision is expected by the end of the year.

Event:

2006 corporate restructuring (TIM Nordeste + TIM Maxitel) was questioned by Federal Tax Bureau in 2011

Impacts:

Damage on image

Status:

Under discussion at administrative level of tax bureau.

There are precedents

Event:

Allegation of low provisioning for contingencies

Impacts:

Damage on image

Status:

No impact on financial

Accrual based on internal and independent external opinion expert, following IFRS rules.

DataUsers

Total Traffic

Customer Base

Community Expansion

FMS(Voice)

Internet for everybody

440k

HP ready to sell

Tim Fiber Fixed BB

Back to fundamentalsCustomer

Base(users)

69.4 Mln

TotalTraffic

(minutes)

28.7 Bln

Sep11 Sep12

Data Users(unique)

20 Mln

Homes Passed(households)

+2X+34%+28.3%+17%

Sep11 Sep12 Sep11 Aug12 Sep11 Aug12

3

Regulatory Update

PGMC

• Access to fixed operators networks (SMP concept):Unbundling and Bitstream of copper networks.Access regulation to transmission networks at speeds up to 25 Mbps.

• Infrastructure sharing:Opportunity to share the passive infrastructure (duct,conduits and towers).

• M-M interconnection:Discussion over the adoption of Partial Bill & Keep formobile-mobile relations between SMP and non-SMP.

4G

• 2.5 GHz:Contract is signed, 10% paid in 4Q12, 90% to be paid in2Q13 (License value: R$ 382 mln).Suppliers are defined: Huawei, Nokia-Siemens andEricsson.

• Future of 700 MHz Auction :Ongoing discussion among Anatel, mobile carriers and broadcasters on digital dividend.

MTR

• Defined glide path in 2013:For 2013, it should be confirmed the glide path already determined (cut of ~9.5% in February).

• Cost model:Analysis is expected to be concluded by Anatel in 2013 and its implementation is being discussed among operators and the regulator.

QUALITY

• Improvement Plan:Focus on the improvement of customer care andnetwork.

• Anatel quarterly assessment: Based on follow-up monthly meetings

• Indication of the integrality of the new quality rules - new broadband indicators start to be informed of November/ 2012.

4

Operations

5+

W14 W16 W18 W20 W22 W24 W26 W28 W30 W32 W34 W36 W38 W40

Sales Growth Rebound

Sales Force(Points of sale EoP)

Gross adds come back

Prepaid resilient growth

Postpaid acceleration on

human lines (ex-M2M)

Strong sales channel force

Efficient growth approach

Sales Ban Effect

Trendline

Gross Adds - Customer Base(Weekly; ‘000 lines)

Back on track

~300k

115

MassChannel

Own Stores

+12.6% QoQ

+16.2% QoQ

Focus on Efficiency(R$; months)

55

36 34

2.3

1.8

3Q113Q10 3Q12

1.7

SAC/ARPU

SAC

-34% -7%

6

Operation Remains Solid

Customer Base(Million lines)

Total Market Share Growth(% of total lines)

9.7+2.7

+3.7 +4.9 +3.1 +1.7

68.910.0

PostPaid

2Q11

55.58.0

1Q11

52.87.7

3Q11 4Q11 1Q12 2Q12

59.2 64.1 67.2

8.79.3

Net Adds (000)

Post Paid

Pre Paid

223 632317 655 348

1,598 3,0532,359 4,219 2,786

348

1,308

Δ YoY3Q

+1.6

+8.6

+19%

+17%

Δ%

Oi

Claro

Vivo

3Q112Q111Q11 2Q124Q11

25.5%

1Q10

25.4%

2Q10

25.3% 25.4%

4Q103Q10

29.5% 29.5%

24.0%

25.6%

29.5%29.5% 29.8%

26.0%

19.5%

25.1%

29.7%

26.8%26.5%

19.4% 19.7% 19.1% 18.8% 18.8% 18.5%

30.1% 30.2% 30.1%

24.6%25.3%

20.1%

25.5%

24.9%

20.4%

29.6%

18.7%

24.6%

26.9%

1Q12

23.7%24.5%

25.1%57.6 58.9

47.545.1 50.6 54.8

Source: Company estimates

Source: Anatel

640bps

290bps

Largest Prepaid

Base

Postpaid Base Analysis (ex-M2M)(Million lines)

1st in yearly growth for 9 consecutive

quarters

59.1

10.3

3Q12

69.4

+0.5

261

274

29.7%

25.4%

24.5%

26.8%

18.7%

3Q12

Total postpaidbase

Human lines postpaid base

8.6 8.9 9.0

Δ% YoY3Q

8.78.9 9.1 9.3 9.4 9.5 9.7 9.8 9.9

10.0 10.2 10.310.4

Jun 12 Sep 12Sep 11 Dec 11 Mar 12

+19%

+24%

541k Net Adds in 3Q12

Handset Sales Market Share(% of handset revenues 1H12)

31%

37%

26%

7% Leading the handset market.

Even being the only player with “No

Subsidies” approach.

Driving data usage growth

-280k in 3Q12 (M2M disconnection effect)

TIMP1 P3 P4

57%

43%Open Market

Operators

7

Source: Anatel

Consumers Complains: Good position at Anatel and Procons

IDA – Index of Attendance (last reported by Anatel)(Points)

98.5596.95

99.1596.75

95.20

99.4098.10

100.0097.40 97.90 97.70

99.90 98.65

90.8591.35

94.0093,95

93.80

95.05 94.5097.00

95.3096.70

95.1098.00 94.0093.70

91.0592.65

90.30

86,3587.90

86.5589.85

86.65

91.00

88.80

92.80 88.10

87.2085.80

88.3086.40

83.90 84.8083.30

86.2085.00

89.35

74.8484.85

77.25

jul/11 aug/11 sep/11 oct/11 nov/11 dec/11 jan/12 feb/12 mar/12 apr/12 may/12 jun/12 jul/12

Volume of claims at Consumer’s Protection Agency (Procon)(# Quarterly claims)

6.032 6.286

7.112 7.591 8.229 7.693 8.811

7.376 7.416

6.673 6.229 7.166 6.533 7.422

9.664

11.788 13.696

16.013

19.245 18.560 21.179

8.740 8.601 9.592 9.344

10.687 10.508 12.348

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12

Procon Demands(% of total)

15%

18%

43%

24%

TIM

TIM

TIM

Source: SINDEC data base. Represents 45% of total Procons (17/10/12)

Source: Anatel

Source: SINDEC

TIMP1 P3 P4

8

Marketing

9+

Customer Sentiment

Preference and Rejection of customers(%)

TIM Quality Portal

TransparencyTransparency

QualityQuality

RelevantInnovationRelevant

Innovation

• Reinforcing position of transparency

• Offer w/ no Tricks• Clear communication

• Reinforcing position of transparency

• Offer w/ no Tricks• Clear communication

• Anatel plan on track• Network development• Caring effectiveness

• Anatel plan on track• Network development• Caring effectiveness

• Unlimited• Convenient• Innovative

• Unlimited• Convenient• Innovative

28 28 29 2823 22 21 22

2528

32 31 3027

11 11 11 1015 15 15 15

11 10 9 9 913

May06

Oct06

May07

Nov07

Jun08

Nov08

Jul09

Nov09

Jun10

Nov10

May11

Nov11

May12

Aug12

Preference

Rejection

∆ Pref x Rej

Player 1: 19

Player 3: 2

Player 4: -8

21 14

Anatel Plan Disclosure

Monitoring:Real coverage

footprint

New and planned

antennas

Wi-Fi hotspots

www.tim.com.br/qualidade

• Network Improvement

• Quality KPI’s

• Network Incidents and Alerts

10

Source: IpsosResearch

Mobile as the Universalization Driver

Data users customer base(Million lines)

CB growth Mobile x Fixed(Million lines)

Mobile services are the driver of growth and universalization for the sector

TIM MOU reaccelerating(Minutes)

130 131

126 127

139

3Q124Q113Q11 1Q12 2Q12

121

258

39 ~43

3Q122007

Mobile

Fixed2

51

1019

3Q122008

Mobile

Fixed~6X

Source: Anatel and Company`s estimates Source: Anatel and Company`s estimates

TIM’s total traffic growth of 28.3% YoY to 28.7 billion

Fixed ARPU of ~R$50 vs. Mobile ARPU of ~R$19

Mobile Data accesses reached 51 mln (+3.2x vs. 1Q11)

+7% ~25X

~2X

DataUsers

Total Traffic

Customer Base

Community Expansion

FMS(Voice)

Internet for everybody1

1

2

2

3

3

11

Sustainable Usage Growth

ARPU(R$)

2Q121Q124Q113Q11 3Q12

+3.5% QoQ

ARPU Recover in a

QoQ Comparison.

Strict Churn Policy.

Human Postpaid

Growth (ex-M2M).

Postpaid(Minutes, %)

3Q11 3Q12

Human Postpaid

Churn

MOU+15%

-1.74 p.p.

Prepaid(Minutes; Units)

3Q11 3Q12

Top UpVolume

MOU+3%

+12%

12

Internet Continuous Take-Up: Handset + Offer

Smart/Web phone Penetration(% over total base of lines)

31.1%

1Q121Q11 3Q11

26.6%

35.2%

15.4%

2Q124Q11

12.6%

19.5%

2Q11

SMS unique users growth(Daily unique users)

2Q121Q124Q113Q112Q111Q11

3Q12

~20

3Q11

~15

Data users(Million monthly unique users)

59% 69%

3G coverage(% of urban pop.)

VAS Gross Revenues(R$ Billion; % of Gross Mobile Services Revenues)

0.83

3Q11 3Q12

1.12

3Q12

3Q12

39.0%

19.4%15.7%

+ 370 bps

+3X

+34%

+35%

13

Products Net Reveneus(R$ Million)

+28%

% sales ofweb/smartphones

71% 72%

485

622

3Q11 3Q12

Financials

14+

Consistent EBITDA and Net Income Growth

369

EBIT Net Financial Result

Net Income 3Q12

Taxes andOthers

545

1,202

Depreciation/Amortization

318

EBITDA3Q12

-29

∆YoY +3.8% +1.9% +6.3% -52.9% +47% +0.4%

-657

-198

1,157

EBITDA3Q11

Adj. EBITDA3Q12

-155

Marketingand Sales

1,202

Pers./G&A and others

+73

Handset Margin

-89

Network and ITX

+45

Services Revenues

26.5%26.3%

EBITDA Margin

Service EBITDA Margin32.7%32.0%

+214

EBITDA Evolution(R$ Million)

From EBITDA to Net Income (R$ Million)

-7.2% +21.9%-39.6% +13.0%+5.5%∆YoY

1,244

Non-recurring

Adj. Net Income 3Q12

+16.6%

-42

25.5%

31.0%

+3.8%

Rep. EBITDA 3Q12

16 mln of provision on advertising credit26 mln of provision on Anatel administrative procedures established between 2007/09

+7.5%

15

16 + 26 = 42.1 mln – provisions9.1 mln – monetary adjustments for the administrative procedures

604 684827

Analysis on Efficiency & Cash Position

Net Debt(R$ Million – EBITDA trailing 12m)

OFCF(R$ Million)

3Q123Q113Q10

2,0791,458 1,550

3Q123Q113Q10Net DEBT/

EBITDA 0.5x 0.3x 0.3x

Capex(R$ Million)

ΔOFCF R$144mln YoYΔEBITDA-CAPEX= R$126mlnΔWC R$17mln

3Q123Q113Q10

Impr

ovin

g C

ash

Gen

erat

ion

Effic

ienc

y A

ppro

ach

Rem

ains

Leased Lines, Traffic and ITX Costs(Compound Growth Rate - Quarterly)

3Q11 3Q12

Handset Capitalized Subsidy(R$ Million)

64

0 0

3Q10 3Q11 3Q12

Bad Debt Trend(as % of Gross Revenues)

3Q12

1.14%

3Q11

0.95%

3Q10

1.34%

526

853772

77%91% 92%

% for Infrastructure

4Q11 1Q12 2Q12

ITX costs (ex-SMS)

Traffic

LeasedLines costs

6.4%

1.2%0.6%

OFCF/Net Rev.16.4% 15.6% 17.5%

16

+21%

TIM Fiber Update

17+

Market Demand(Units)

Quality of Service(Mbps)

Buildings authorized

7,101

Building’s connected MSANs installed

Network Construction

Homes Passed Ready to Sell

11

Optical network

MSANs

Backbone

Live TIM: Up & Running

22

33

Website Registration 120.5k

Market Demand and Quality of Service

Average Speed

1.8

35 37

0.4

20 21

MarketAverage

Live TIM(nominal)

Live TIM(delivered)

Download

Upload

Blogger Richardmax: “Live Tim, so far, is the only one to fulfill its promises, moreover above the promises, because the 35Mb hired tests are always above 37, and uploads are always spiking 20. “

2Q12 3Q12

5,700 3,026

2Q12 3Q12

2,100 405

2Q12 3Q12

214

440k

2Q12 3Q12

220k

Specialist Blogger @ http://richardmax.rmax.com.br/18

Network Roll Out(‘000 Households)

Live TIM: Speeding-Up with the New Offer

Sales(Average weekly sales)

New Offer: Shaking the Broadband Market

Business Model Proving Itself

Sep/12

BeforePromo

Oct/12

~5X

~590

>100

May/12 Dec/12

~6X

Addressable Market(Homes passed)

After Promo

Optical Network

MSANs~R$2k

Coverage Capexper Home Passed

~R$80

~R$800

Installation Capexper Sub

~R$300

TIM Fiber

Int. Bench.*

TIM Fiber

Int. Bench.*

~R$5k

Total Capexper Sub

~R$700

TIM Fiber

Int. Bench.*

*International Benchmarking19

Conclusions & Outlook

20+

Voice Capacity(‘000 TRXs)

157205

+30%

Data Capacity(‘000 channel elements)

139

328

2011 20123Q12

FTTS (Fiber to the Site)(‘000 Km Fiber)

29 38

2011 20123Q12

Conclusions & Outlook

95% Done in 3Q12

115% Done in 3Q12

96% Done in 3Q12

2011 2012

Customer Base Growth(Millions)

46.959.2 69.4

MOU (FMS on Play)(Minutes)

123130

139

Data Revenues Accelerating(R$ Billion; % Gross Mob. Serv. Rev.)

0.60.8

1.1

TIM Fiber Network Roll-Out(‘000 Households)

3Q10 3Q11 3Q12 3Q10 3Q11 3Q12 3Q10 3Q11 3Q12 May/12 Dec/12

Quality Improvement “Commitment with Anatel”

Business Fundamentals Remain Solid

Better regulatory environment

Tax easing policy

13%16%

19%

3Q12

Outlook

~590

>100

~6XAddressable Market(Homes passed)

2012 guidance commitment

Innovative approach unchanged

21

+136%+31%