T

1
Earnings Conference Call 1st Quarter 2009
Investor Relations
2
1Q09 HighlightsRelevant short-term achievements
lead us to long-term goals and the to the targets
set for 2009
?

• Brasil Telecoms acquisition was concluded in
  January 2009
• Oi becomes a nationwide mobile telephony and data
  communications operator
• New operating and financial size 40 increase in
  RGUs, annual net revenue exceeding R30 billion
  and annual EBITDA of over R10 billion
• Successful launch of debt transactions
  internationally (April/2009)
• Placement of US 750 million 10-year bonds in the
  international market at 9.625
• Initial integration process with Brasil Telecom
• Operations organizational structure
  consolidation, launching of brand and initial
  integration of portfolio offering for retail and
  corporate products
• Corporate filing of Notices with the CVM,
  awaiting for formal approval

?
?
3
Consolidated Revenue Generating Units Oi records
consistent growth thanks as mobile and broadband
segments expand
Customer Base Million
Consolidated RGUs Million
Fixed Lines
Broadband
Mobile Telephony
21.7
45.3
57.7
10.3
-1.1
18.3
47.4
1Q08
1Q09
1Q08
1Q09
1Q08
1Q09

• 3G the Companys strategy focused on selling
  mini-modems
• Fixed broadband 3G mini-modems 4.1 million
  clients or 795 thousand additions in last 12
  months (23.9 )

Net additions
1Q08
1Q09
Includes Oi TVs cable users (50,000 clients)
4
Consolidated Revenue Generating Units Region I
remained robust, and São Paulo additions reflect
strong performance in only 5 months of operations
Mobile Customer Base Million

• Prepaid
• 87 of net additions since March 08
• 84 of total mobile customer base by the end of
  the quarter
• Post-paid
• Oi Conta Total amounted to 1.2 million in March
  09, 79.7 above March 08
• 29.4 of Ois Region I post-paid base in the
  quarter (area where the product is available)
• National Market Share of 20.7 in March 09, as
  follows
• 31.0 in Region I (leader)
• 15.0 in Region II
• 6.8 in Region III (5 months after start-up)

31.8
2.6
1.4
5.9
21.9
26.8
18.2
3.7
5.0
RI
RII
RIII
1Q08
1Q09
Net Additions
5
Financial Performance Consolidated Gross
RevenueGross revenue grew leveraged by mobility
and data communications
Consolidated Gross Fixed Revenues Growth 1Q09 x
1Q08
Consolidated Gross Revenue
R Million
R Million
Fixed
Mobile
D1Q08
7.8
11,242
10,431
28.4
Mobile Additional Services
Network Usage
Local Service
Public Telephones
Data
Others
TOTAL
Consolidated Gross Mobile Revenues Growth 1Q09 x
1Q08
R Million
3.6
1Q08
1Q09
Data and VAS
Network Usage
Originated Calls
Subscriptions
Others
Handset Sales
TOTAL
Fixed Long Distance and Advanced Voice
Mobile Roaming and Handset Sales
6
Financial Performance Consolidated Operating
Costs and ExpensesRecurring items not present in
the 1Q08 affect cost comparison
Consolidated Operating Costs and Expenses
R Million
Non-recurring Items
4.9
9.9

• Consultancy firms expenses related to BrT
  operation
• End of subsidies deferral to retail post-paid
  handsets (related to end of the fine)
• Integration with BrT

4,647
4,876
Non comparable items, as they were not costs in
1Q08, but had an impact on 1Q09

• Start-up in São Paulo and acquisition of Amazônia
  Celular
• Standardization of Ois and BrTs accounting
  practices

Recurring and Comparable Cost 1Q09
D Accounting Costs and Expenses
Non-comparable items
Accounting Cost 1Q08
Non-recurring Items
Accounting Cost 1Q09
Recurring Cost 1Q09
According to the contract, the subsidized
post-paid handsets allowed for a deferral per
handset, which was amortized in a 12 month period
(contract period). This practice resulted from
the fact that retail customers were charged a
penalty for early cancellation or migration to
pre-paid.
7
Financial Performance Consolidated
EBITDARecurring consolidated EBITDA affected by
São Paulos start-up and standardization of
accounting principles in BrT
Consolidated EBITDA Oi (TNLP) R Million
Margin
Consolidated EBITDA - TMAR R Million Margin
2,377
1Q09 Adjusted
1Q08

• Adjustment of accounting standards to those of Oi
• Booked in BrTPs shareholders equity on the day
  of the acquisition
• No impact on TNLs consolidated figures

EBITDA Margin
36.1
32.0
Consolidated EBITDA - BrTP R Million Margin
1Q09 Adjusted
1Q08
1Q09 Adjusted
1Q08
Ajusted EBITDA Margin
31.7
35.7
EBITDA Margin
34.1
32.9
8
Consolidated Financial PerformanceNet income was
negatively impacted by higher financial expenses,
as well as the beginning of goodwill amortization

• Financial income declined by R65 million (lower
  average cash invested)
• Higher financial expenses of R397 million,
  resulting from
• Higher gross debt
• Higher actual cost of debt
• Monetary update for contingencies and financial
  charges related to 3G license

R 462 million
1Q08
1Q09

• Main factors affecting net income
• Higher net financial expenses
• Initial goodwill amortization derived from the
  acquisition of Brasil Telecom
• Lower operational revenue, if non-recurring
  effects are included

- R 553 million
1Q08
1Q09
9
Financial Performance Consolidated DebtNet
debt increased with the consolidation of
Invitel/BrT and disbursements, particularly those
related to the payment for Invitels control
Consolidated Gross Debt R Billion
Gross Debt Amortization R Billion
Local Currency
Foreign Currency
Hedge
25.9
20.5
9.0
2009
2010
2011
2012
2013
From 2014 on
Mar/08
Dec/08
Mar/09
Consolidated Net Debt R Billion

• Debt in foreign currency and swaps 18.3 of
  total debt as of March 2009
• Reduction of foreign exchange exposure to 2.2 of
  total gross debt in the quarter
• Effective cost of debt 11.65 (97 of CDI)
• Cost of debt (contract)
• Local Currency 105 of the CDI
• Foreign Currency Libor 3.0
• Net Debt/adjusted EBITDA 1.9x

Mar/08
Dec/08
Mar/09
10
Financial Performance Consolidated
CAPEXConversely to 1Q08, CAPEX focused on the
mobile segment accounted for the largest portion
of consolidated CAPEX
CAPEX R Million
Fixed
Mobile

• Consolidated CAPEX
• 12.1 of 1Q09 net revenue (vs 11.2 in 1Q08)
• 74 for business growth(42 wireless and 32
  data/broadband)
• Fixed Telephony Capex
• Decrease related to high volume allocated to
  data/broadband expansion in 1Q08
• Mobile Telephony Capex
• Increase related to funds allocated to São Paulo
  operations

5,000 to 6,000
12.1
D1Q08
905
807
154.3
-20.5
1Q08
1Q09
2009E
11
(No Transcript)