Tim meeting with investors - june 2018

TIM Participações - Investor Relations
Meeting with Investors
TIM Brasil
Company’s Presentation
June, 2018

2
This presentation contains statements
that constitute forward looking
statements regarding the intent, belief or
current expectations of the customer base,
estimates regarding future financial results
and other aspects of the activities.
Such forward looking statements are not
guarantees of future performance and
involve risks and uncertainties, and actual
results may differ materially from those
projected as a result of various factors.
Analysts and investors are cautioned not
to place undue reliance on those forward
looking statements, which speak only as of
the date of this presentation. TIM Part
undertakes no obligation to release publicly
the results of any revisions to these forward
looking statements.
Disclaimer
Financial results are presented on Pro
Forma basis, disconsidering impacts
from IFRS 15 adoption.

3
Agenda
Visit our website and download our IR app:
www.tim.com.br/ir
TIM IR app
(English)
TIM RI app
(Portuguese)
About Us ………………………………………………………………………………………………………4
Market Overview and TIM Positioning ……………………………………………………………………..9
Regulatory Update ……………………………………………………………………………………….....35
1Q18 Results ……………………………………………………………………………………………......17
Strategic Plan 2018-20 ……………………………………………………………................................. 28
Appendix ………………………………………………………………………………………………….... 39

4
ABOUT US

EBITDA¹ Margin
26.6%
28.4%
31.5%
33.5%
36.6%
2013 2014 2015 2016 2017
New Brand and Offers Positioning
#2 in Mobile
Net Services
Revenues
Best and Wider
4G
Network
¹ Normalized Figures.
>85k km of
fiber optical
network
throughout
the country
TIM's Turnaround consolidated: from Recovery to Consistent and Sustainable Growth"
Presence in
Brazil
since 1998
Introduced the
first plan focus
on data for
smartphones
#1 in
prepaid
users
#2 in postpaid
users
(excluding
M2M)
%
Net Service Revenues
2.5%
-3.0%
-5.8%
-4.3%
5.1%
2013 2014 2015 2016 2017
%
5

Redesign the Customer Experience of our customers to become the best value for money player leveraging our leadership
position as an Ultra-Broadband player and our disruptive Offer proposition. Shift internal Culture from “excusability” to
Accountability, redesign Platforms and Processes from analogue to Digital to allow a full Digital Transformation.
Customer Experience
Offer Infrastructure Efficiency
Digitalization
Culture
Offer based on customer interactions
Residential ultra broadband through 4G
network
Convergent offers and multimedia
services
3 53 4
Integrated channel approach for sales and
customer service
More flexible operator to lead market evolution
5
Improved Customer Experience due to advances in
all other pillars6
Digital transformation
Creation of a Digital marketplace,
connecting customers and
partnerships
2
Accountability and
efficiency as part of
culture
1
6
1
2
4G expansion in 700MHz
Coverage > 90% of urban population
Selective expansion of FTTx network
4
Strategic Pillars
6

1. Education
Every child and young person has the right to a
science and mathematics education that
represents the advances in knowledge gained in
these areas.
2. Applications
Technological innovation should serve human
development
3. Work
Technological innovations are the basis for a new
way of working.
4. Inclusion
People have the right to learn about new
information and communication technologies and
how they influence their everyday decisions.
7
Founded in July, 2013
MISSION: We are committed to creating and strengthening resources and strategies for the
democratization of science and innovation that promote human development in Brazil, with
mobile technology as one of the main facilitators.
Corporate Social Responsibility
Applications
ZUP – Zeladoria Urbana Participativa
Agentes da Transformação
Mapas Culturais
Busca Ativa Escolar
TIM + Unicef
Education
Círculo da Matemática do Brasil
Support to Science and
Technology Museums and
Centers
TIM Faz Ciência
TIM + Brazilian Public School
Math Olympics (OBMEP)
Inclusion & Work
Academic Working Capital
TIM Tec
PRINCIPLES AND STRATEGIES
TIM Stands out in
Sustainability
Joined UN Global Compact
in 2008
Member of ISE (Sustainability
Index) for 10 consecutive
years
ISO 14001 certified since 2010, 1st
Brazilian telco and ISO9001 Quality
Certification for Billing and Networking
processes
Sustainability

8
Corporate Governance
 Statutory Audit Committee:
• Report to Board of Directors
• Oversight Financial reporting
• Analyze anonymous complaints
 Compensation Board and Internal Control and Risk Board operate
indefinitely and act independently
 Whistleblower channel website
Brazilian Law
“Lei das S.A”
Legal
Requirements
Demand for
transparency and
disclosures
Highest level of
Corporate
Governance
Requirement of
protection for
minority
shareholders
Unique Telco company listed on the Novo Mercado
Committees to Reinforce and Guarantee Solid Corporate Governance
10 members
(3 independents)
3 members
(3 independents)
3 members
(3 independents)
3 members
(1 independent)
5 members
(2 independents)
8 members
 Equal rights: vote, dividends and tag along
 Higher liquidity
• Single class of share (ordinary shares)
 Greater independence of Board of Directors (at least 20%)
 Strict disclosure policy

9
MARKET OVERVIEW and TIM
POSITIONING

10
Brazilian Telcos: Financial X-Ray

11
Brazilian Telcos: Operational X-Ray

12
Brazilian Telcos: Revenues X-Ray
Total Services Net Revenues
R$ mln
Mobile Service Net Revenue
R$ mln
62,659
60,724
61,798
62,112
2015 2016 2017 LTM12
Total Services Net Revenues - Share
%
37.7% 40.1% 41.1% 41.1%
23.5% 23.0% 23.8% 24.2%
18.7% 17.6% 17.8% 19.0%
14.1% 13.8% 13.0% 12.2%
6.0% 5.5% 4.4% 3.6%
2015 2016 2017 1Q18
Mobile Service Net Revenue - Share
120,999
119,286
118,460
118,143
2015 2016 2017 LTM12
33.6% 34.6% 35.6% 35.7%
29.1% 29.3% 29.4% 29.8%
21.5% 20.9% 19.7% 19.0%
12.7% 12.3% 13.1% 13.6%
3.1% 2.8% 2.3% 1.9%
2015 2016 2017 1Q18
%
Nextel
TIM
Oi
Claro
Vivo
Nextel
TIM
Oi
Claro
Vivo

 c50% of the time is spent watching video and to
communicating with voice
 Text messaging (SMS) accounts now for only c10% of text
communications
Usage: Apps x Traditional Services
23 51
88
98
211
149121
262
236
07 08 09 10 11 12 13 14 15 16 17
0.41 0.42 0.42 0.42 0.42
0.36
0.32
0.24
0.16
0.10
0.06
0.03 0.02
07 08 09 10 11 12 13 14 15 16 17e 18e 19e
13
Change in Customer Profile and Mix
MTR Cuts
Stabilization
Changing Customer Base Mix
Expansion
Consolidation
Total base in mln customers
R$
Prepaid
Total
Postpaid
¹ Source: comScore
²Source: HSBC
89% of Brazilians' digital time in mobile is spent on apps
30% of Brazil's digital population uses only mobile device
In Brazil, 33% of the digital time is spent on social network and
instant messaging apps
Mobile Global Research¹
New Customer Profile
Brazil “Anatomy of the Consumer”²
50%50%
Netflix /
Youtube /
etc
Live TV50%50%
Whatsapp /
Skype
Telephone
voice calls

TIM Brasil: Growth Waves
Complexity/Timing
RevenuesGrowth
~5%
~8%
FTTH/WTTX &
Convergence
Market
Consolidation
2
3Consumer Mobile
& TIM Live (FTTC)
1
B2B
Fixed & Mobile
Mobile Market Revenues
(R$ mln)
BB Market Revenues
(R$ mln)
2017E 2018 2019 2020 2017E 2018 2019 2020
CAGR
>3%
CAGR
>6%
1 Consumer Mobile (“the Controle wave”)
• Growth mostly based on a «Pure Mobile»
approach with Residential BB opportunity
geographically limited.
• TIM exploits the benefits of its 4G
acceleration.
3 FTTH/WTTX & Convergence
• Accelerated Fiber deployment (backbone,
backhaul and FTTH).
• Additional revenues growth and Convergent
CB expansion thanks to FTTH Service.
2 Business Segment (SMB and Top)
• Opportunity to gain Market Share and
support a Top Line rebound leveraging on:
• Brand repositioning and New
Portfolio;
• More Convergent approach;
• CEx centric philosophy.
14

Mobile Growth Levers
(1) TOP 5 market includes SMP+SME
24.5%
23.1% 22.7%
23.8%
>26%
2014A 2015A 2016A 2017E 2018 2019 2020
Mobile Service Revenues Share¹ (%)Total ARPU Trajectory (R$)
2017A 2018 2019 2020
CAGR
High Single Digit
PORTFOLIO
BEST
OFFER
LOYALTY
(CHURN MANAGEMENT)
PREPAID
CONTROLE
PURE
POSTPAID
• Innovation: dedicated data
package and OTT partnerships
for 3P offers
• Convergence in FTTX/WTTX
• Simple and segmented
offers
• Better acquisition quality
• Big Data Analytics to
improve churn prediction
• Services lock-in offers
• Handsets with lock-in as key
element of proposition for
the high end segment
• Targeted handsets and
services lock-in offers
CB MANAGEMENT
• 1-2-1 management with RTD
(UP-SELL and RETENTION)
• 1-2-1 management (UP-SELL
and RETENTION) with
segmented and dedicated
offers (Mass Market)
• Best offer using “more for
more”
• Innovation: OTT
partnerships
GO-TO-MARKET &
POSITIONING
• Enhance TIM Black
positioning to accelerate the
recovery of high end
customer perception
• Naked SIM to improve
acquisition quality and go-
to-market flexibility
CEX & DIGITAL
• Recurring offer and Naked SIM
simplify and improve the
customer experience
• Continued evolution of digital
channels
• Focus on convenience and
digital payment
• Push Meu TIM App w/ new
features (self-caring, up-sell)
• Focus on convenience and digital
payment
• Push Meu TIM App w/ new
features (self-caring, up-sell)
• Best value for money,
convenience and control
• 1-2-1 management (UP-SELL
and RETENTION) with
segmented and dedicated
offers (Mass Market)
15
Pure
Postpaid
Control
Postpaid
Prepaid
Recurring
Prepaid
Non-Recurring
Upgrade
Upsell
Upsell
Loyalty
Upgrade
Upsell
Upgrade
Upsell
Monetizing Customer Base

Opportunity for Residential Broadband solutions to be captured
2017E 2018 2019 2020
> 60%
20% - 40%0 – 20%
40% – 60%
Residential Broadband Penetration
• Broadband Penetration 42%
• Ultra-BB Penetration 6%
• 96% of cities (~50% population) has very low BB
penetration (~20%)
• 23% of BB connections have speeds < 2Mpbs
Relevant opportunity to capture a strong
unserved demand for Residential
Broadband and Ultra-BB connectivity
Fixed Broadband Market Customers
(mln users)
FTTH
• Best overall performance (capacity, speed and
stability)
• Focus on high value customers and high
customer experience standards
• Smart strategy coverage launching in new cities
• Leverage in fiber infra already built for mobile
• Partnership with content providers
1
• Increase of capacity on already saturated areas
• Refocus with dedicated offer to high income
areas with historical low sales performance
• Higher speeds (VDSL2+) and ARPU over the
existing coverage
• Partnership with content providers
FTTC2
• Simple and smart solution (plug n play, value for
money)
• Focus on customers with limited broadband
services (suburbs and smaller cities) offers
• Fast time-to-market to attack new regions
(incremental revenues)
• Optimize investments: use of 4G network
(700Mhz) spare capacity
WTTX3
CAGR
>6%
16

17
1Q18 RESULTS

Quarter Highlights
 Consistent Service
Revenues Expansion
 Solid Customer Base
Growth in Mobile Postpaid
and Fixed Broadband
 Operating Profitability with
Strong and Further
Improving Performance
 Network Evolution
Supporting Great Operating
Momentum
Net Service Revenues (R$ bn)
3.6 3.7
4.0
1Q16 1Q17 1Q18
+3.5%
+6.4%
EBITDA¹ – Capex (R$ bn)
0.5
0.6
0.8
1Q16 1Q17 1Q18
+31.3%
+38.9%
Mobile ARPU
+13.8 %
YoY
Live ARPU4
+12.5%
YoY
700 Mhz cities
975
+59 vs. 4Q17
FTTH³ HH
+202 (000)
vs. 4Q17
EBITDA¹
+16.4 %
YoY
EBITDA Margin¹
35.5 %
(+3.6 p.p YoY)
MSR
+6.0 %
YoY
Live Revs
+43.4 %
YoY
18
12M Postpaid
Net Adds²
+3.0 Mln
12M UBB Net
Adds
+88k
¹Normalized figures
²Postpaid Net Adds Ex-M2M
³Addressable households ready to sel
4 UBB + VOIP

Mobile Operations: Focus on High Value Customers to Accelerate
Growth
Loyalty
Offers with Lock-In to
reduce Churn
Value
More for More
Data/Content Centric
New Partnerships boosting
usage and guaranteeing
differentiation through
innovation
Voice Only Users
Management of 2G
Customers
Recurrence
Weekly and Monthly Offers for
Prepaid, Control, Pure Post
Mobile Base¹ Mix Shift (% of users)
Non Recurring
Prepaid
Recurring
Prepaid
Postpaid
1Q17 1Q18
25% 32%
13%
29%
62%
39% 4G
Users
3G
Users
2G
Users
1Q17 1Q18
25% 20%
43%
29%
32%
51%
ARPU per Segment (R$) BOU per Technology (MB)
11.2
11.4
1Q17 1Q18
+1.6% 38.7
40.0
1Q17 1Q18
+3.4%
Prepaid Postpaid 3G 4G
535
602
1Q17 1Q18
+12.6%
1,202
2,215
1Q17 1Q18
+84.3%
¹Source: Company; Anatel 19

Prepaid PostpaidControle
Daily Recurrence Light Mid-High Low Mid-HighLow
Communication
Instant communication
apps with EXCLUSIVE
benefit of unlimited calling
Mobility
Mobility apps as a
convenience differential:
navigation and taxi
YouTube as an additional
benefit of TIM Black
boosting video
Proposition and offer
differentiation
Video
Social Networks
Most relevant social apps on the
market included in TIM Black B
and as plugin for Control and
Prepaid
Video
New Portfolio to Tackle Key Customers Demands
20
Communication
Mobility
Social
APPs
Impact on
Data
Usage
Penetration Motivation
Medium
Low
High
High
High
High
• Offload 2G/3G
Network
• ITX Reduction
Differentiation
Differentiation
Differentiation
and Monetization
Medium
High
+R$1.5/day
+R$10/week
+R$20/month
+R$10/week
+R$20/month

62.9
70.8
1Q17 1Q18
TIM Live: Solid Delivery While Preparing for a New Wave
UBB Customer Base (000)
322
411
1Q17 2Q17 3Q17 4Q17 1Q18
+27.4%
TIM Live ARPU (R$, %YoY)
+12.5%
Connection Speeds (% users)
Residential Broadband Portfolio Evolution
57%
36%
5% 2%
35Mbps
40/50 Mbps
70 Mbps
≥ 90 Mbps
E-MAGAZINES
100 Mega to 2 Giga
(FTTH)
TIM’s ultra broadband with
optical fiber high speeds
bringing the future
Inside your home
40 Mega to 150 Mega
(FTTC)
TIM’s residential broadband
awarded the best of Brazil
2 Mega to 4 Mega
(WTTX)
Plug and play home internet.
Neither wires or installation
cost
ULTRA FIBER INTERNET
VALUE ADDED SERVICES
VIDEO SECURITY EDUCATION
OTT Video Partners
TIM Live Revenues (R$ mln, %YoY)
59
85
1Q17 1Q18
+43.4%
41.5%33.2%
Fixed
Revs Mix
POWER WI-FI
TIM Banca Virtual TIM Ensina
TIM Live Protect
TIM Fixo
Other Services
21

16,3
12,9 11,7
7,9
TIM P3 P1 P4
Largest 4G Coverage (# cities, # sites)
39%
65%
61%
35%
1Q17 2Q17 3Q17 4Q17 1Q18
4G 2G + 3G
3,110
2,667
1,504
284
TIM P1 P3 P4
Cities¹
Sites² (000)
Solid Mobile and
Fixed Network
Progress Supporting
Business
Acceleration
Mobile Network Usage (% of traffic)
GPON areas
FTTH Coverage (# areas, # HH)
Addressable HH (000)
WTTX Coverage (# cities)
1Q18 2Q18 3Q18 4Q18 Total
 1st to cover all São Paulo
state with 4G
 92% of Brazil’s urban
population covered
 975 cities using 700MHz, 67
ready for WTTX
 FTTH launched in Mauá, SP.
22
7
42
4Q17 1Q18 2Q18e
50
203
4Q17 1Q18 2Q18e
¹ Source: Teleco website
² Source: Anatel

Best Mobile Network Experience
5.4
5.7
6.4
6.4
6.4
7.5
P5
P3
P2
P6
P1
TIM
Technology Usage
(Mar/18)
4G Availability Award#1 4G Test Ranking
65% 54% 43% 40%
35% 46% 57% 60%
TIM P3 P4 P1
3G
OpenSignal: “LTE availability (…) is extremely important. After all, fast 4G downloads aren’t
very useful if you can only find them a small portion of the time.”
72%
62% 58% 54%
TIM P1 P3 P4
4G Availability
(Jan/18)
80% 72% 65% 64%
20% 28% 35% 36%
TIM P3 P4 P1
Tests per Technology
(Mar/18)
Customer
Experience a Driver
for Differentiation
Solid Improvements in Anatel’s Satisfaction Survey (points)
Postpaid Prepaid Fixed Broadband (2017)
6.4
6.8
7.2
7.0
2015 2016 2017 Market
6.5
6.7
6.8 6.8
2015 2016 2017 Market
23
Best 4G Coverage in Brazil Attested by All Major Network Analytics Providers (% of tests, % of time)
4G
 Expansion in all YoY metrics
of Anatel’s Satisfaction
Survey¹
 Leader in general
satisfaction¹: Postpaid in 14
states and Prepaid in 7 states
 Leader in fixed broadband
general satisfaction¹ for the
past 3 years
 TIM Live #1 in Netflix Ranking
in 33 out of 36 months
¹2017 Anatel’s Perceived Quality and Satisfaction Survey released in March/18

Total Net Revenues Breakdown (R$ mln, %YoY)
+6.6% -0.1% +14.7% -24.7%
3,951 4,139
Serv. Revs. Evolution: Gross x Net (%YoY) Mobile Revenues Mix: Bundled Offers (%)
-2.1%
-1.0%
2.0% 2.3%
5.9%
3.5%
5.0%
5.9% 6.1% 6.4%
1Q17 2Q17 3Q17 4Q17 1Q18
0%
20%
40%
60%
80%
100%
1Q17 2Q17 3Q17 4Q17 1Q18
Bundle
No-Bundle
74%
Net
Gross
Consistent
Revenues
Improvement
 Closing the gap between
Gross and Net Revenues
 Mobile Bundle (voice +
data) Offers Revenues
growing at >40% (YoY)
 Fixed Revenues Recovery
Tim Live +43% (YoY)
Others¹ +1% (YoY)
24¹Corporate, wholesale and others
+4.8%

OPEX X-Ray
 Solid cost control, despite
volume growth impact
 Efficiency Plan continues to
play an important role: 58%
Completion
 Digital interactions¹ rose
>40% YoY and Digital caring
penetration improved 6 p.p
YoY
 Postpaid² sales in digital
channels rose ~20% YoY
Normalized Opex Breakdown (R$ mln, %YoY)
2,688 2,669-10.8% -3.8% +1.8% +5.1%
COGS:
o Lower average sales price (-17.6% YoY) as a consequence of
supplier strategy change: higher quality handsets at a more
affordable price.
Traffic:
o Network: Leased lines tariff reduction and Zero Leased Lines
Project partially offset by higher network sharing costs ;
o Stable content provider cost with improved mix from marketing
perspective (bundle vs pay per use);
o ITX: lower cost after MTR (VU-M) reduction.
Market:
o Higher postpaid Customer Base and Sales drive to an increase in
customer acquisition and management opex (SAC, customer care,
billing and collection) partially offset by digital efficiencies;
o Lower Fistel expenses;
o Higher Bad Debt explained by temporary effects (i) wholesale bad
debt positive impact in 1Q17 due to settlement with other
operators, (ii) delay on invoice issuance and delivery (postal strike)
and by a continued expansion of our postpaid base (+20.5% YoY)
and billed revenues.
Process:
o Increase in labor cost driven by higher variable components and
inflation impacts (IPCA +2.68%);
o Lower FUST/FUNTEL expenses.
1
1 2 3 4
-0.7%
25
¹Interactions using mobile app and website
²Postpaid = Pure postpaid + Control
2
3
4

Profitability & Cash
Generation:
Normalized EBITDA & Normalized Margin EBITDA (R$ mln, %YoY)
1Q15 1Q16 1Q17 1Q18
1,344
1,162
1,263
1,470
29.5% 30.2%
32.0%
35.5%
1Q15 1Q16 1Q17 1Q18
+0.6 p.p +1.8 p.p
+3.6 p.p
-13.5%+0.9% +8.7% +16.4% yoy
Capex (R$ mln, %YoY)
1Q17 1Q18
669
646
-3.5%
Network
IT
Licenses
& Others
Capex/
Sales
17% 16%
Reported Net Income (R$ mln, R$)
132
250
1Q17 1Q18
~2x
EPS 0.05 0.10
 EBITDA & Margin EBTIDA
best performance in 1st
quarter
 Capex focused on
infrastructure and
digitalization
 EBITDA-Capex over sales at
20%
 Solid Net Income expansion
26
78%
87%

27
Key Messages & Outlook
FINANCIAL & OPERATIONAL TURNAROUND
FULLY CONSOLIDATED
Gross Service Revenues: +5.9% YoY
Leader in Postpaid Net Adds (ex-M2M) LTM
7 quarters of positive EBITDA growth and margin
above 35%
Leadership in 4G coverage: Largest & Best Customer
Experience
JUST LAUNCHED OR STILL TO COME IN 2018...
 New portfolio for mobile (Consumer + SMB) “content
focused”.
 Convergent offer for Consumer and SMB in 2H18.
 1 city per month in FTTH and strong expansion of WTTx
coverage in 2H18.
 New positioning in SMB (“Business Partner”) with
differentiated regional approach.
Between R$800
mln and R$900 mln
in IOC distribution
expected for FY18
1
2
3
4
Announced R$230 mln
in IOE to be paid in
August as part of
distribution plan.
3.0
2.3 2.1
0.3
-0.3
TIM P1 P3 P5 P4

28
STRATEGIC PLAN 2018-20

Strategic actions Impact by 2020
Cash-flow
generation
Sustain
leadership
position
Best in class
customer
engagement
≥40% EBITDA margin in 2020
≥20% EBITDA-CAPEX on revenues in
2020
4X growth of residential BB CB ( FTTX +
WTTx)
>4K Cities covered by 4G (96% of Urban
Population)
>2X growth of e-bill and e-pay penetration
~5X growth in My-TIM App users
• Acceleration of Mobile growth targeting more affluent
segments (e.g., controle, post-paid)
• Growth of Residential BB contribution to top-line
• Step-change growth in SMB segment leveraging new
Organization, go-to-market and value proposition
• Development of new and innovative revenue streams (e.g., IoT,
mobile adv, etc.)
• Continued expansion of the best fixed and mobile
infrastructure (4G, FTTX) to differentiate experience
• Improve Customer engagement through increased penetration
of Digital interactions
• Improvement of Cash Generation ability through “smart”
Capex and Debt/Tax optimization
• Capture of digitalization efficiency potential
• “Zero-based” approach on traditional efficiency levers
Prepaid
Postpaid
15,8 >22
~50%
2017 2020
Mobile CB Mix (%)
30%
Executive Summary:
More Postpaid and Broadband to support Revenue Growth and Expand Cash Generation
29

FTTH
Coverage
FTTH
Coverage
FTTX
Coverage
FIXED UBB BOOST
Focus on FTTH and FTTC
2 13cities
0.1 3.0HH (MM)
3.2 5.9HH (MM)
2017 NEW plan! (2020)
TRANSPORT INFRASTRUCTURE
Capillarity to support Mobile and Residential Services
4G EVOLUTION
Capacity Expansion and Coverage Evolution
411
1,255
>3,000
>4,200
916
2015 2016 2017 2018 2019 2020
LTE 700MHz
Cities Covered
4G Cities
Covered
60% ~80% 450
2017
1,200
2020
2017 NEW plan! (2020)
FTTCITY
~+600 vs Old Plan
FTTSITE
96% urban
population
High Capacity
BackhauL (%)
Network: Expansion in Mobile Access and Fiber
30

2017 2020
Vendor Portal:
> 11k invoices/month
already automatized
Compliance Tax:
Increase in fiscal credits
utilization (R$ 100 mln/year)
Legal Process Optimiz.:
System automation and
integration of legal processes
with A.I and Bots
Inventory
Clean up:
Reduction in WBS
(>85%) and invoices
(>25%) by 2H18 with A.I
and Bots
R$0.5 bln
in savings
in 2020
Customer Management: Simplification of Customer Journey Customer Acquisition: Channel Mix Improvement
Prepaid Recharges: Experience and Profitability Support Processes & Systems: Upgraded and
Strengthened IT Architecture
2017 2020
Digital Interactions
(Total)
E-Billing
(#users)
>80%
<2X
E-Payment
(#users)
2017 2020
>2X
2017 2020
~2X
2017 20202017 2020
Sales in Digital Channels
(Control+Pure Postpaid)
Sales in Digital Channels
(Live)
~2x
~3x
2017 2020
Digital Prepaid Recharge Mix
(% Digital sobre Total)
Recharge Commission (ex.
volume effect)
(R$ mln)
-14%
+7p.p.
Process Enhancement
Asset
Management:
RFID tagging process
for assets: safe and
reliable tracing
Efficiency Oriented
Sales & VAS Commiss.:
Automation of the charge
creation process and VAS
revenue share calculation
2x 2017
vs. 2016
3x 2017
vs. 2016
Digitalization will sustain our CEx improvement while supporting Efficiencies
31

10.2
10.3
2017 2018 2019 2020
2018-2020 Plan
2018-2020 except additional cost of TIM Live & WTTx acceleration CAGR
< 4%
< 2%
10.3
(1.0) ~11.5
2017FY Volume &
Structural
Growth
Inflation Savings 2020FY
0.7
1.1
1.3
0.4
1.0
Old Plan
2017-2019
New Plan
2017-2019
Additional
2020
New Plan
2017-2020
Additional Savings
Achieved in 2017
FY17
P18-20
1.7
50% Market Driven
50% Process Driven Post Paid CB: ~+60%1
Residential BB CB2: 4X Growth1; ~+3M HH passed
Network: Sites ~+30%1; Energy MWh >25%1
FTTCity Coverage: ~+800 Cities
Opex Evolution
Efficiency Plan Evolution
R$ Bln
R$ Bln
Efficiency Plan Highlights
• Expected OPEX growth below inflation.
• Excluding additional acceleration in WTTx and Live business,
Opex should grow bellow 2%.
• Network and postpaid customers structural growth continues
to impact costs considering the expected acceleration in
commercial activity.
~50% from Digitalization
¹ 2020 vs 2017
Opex Evolution: over-executing the Efficiency Plan thanks to Digitalization
initiatives
32

33.5%
36.6%
>40%
-0.5
0.4
-0.6
2016A 2017A 2018 2019 2020
New Plan ‘18-’20
Old Plan ‘17-’19
% on Tot.
Revenues 3.9% 11.1% ≥20%
EBITDA
Margin
∑ ‘18-’20: ~12 bln
EBITDA and Margin Expansion
R$ Bln; %
CAPEX
R$ Bln
Net Cash Flow Bef. Dividends
R$ Bln
EBITDA - Capex
R$ Bln
EBITDA
CAPEX
5.2
5.9
2016A 2017A 2018 2019 2020
EBITDA
CAGR 2017-20
Low Double Digit
5.2
5.9
4.5 4.1
2016A 2017A 2018 2019 2020
New Plan ‘18-’20
Old Plan ‘17-’19
≥13%
Increasing Profitability and Cash Generation
33
4.5
4.1
2016A 2017A 2018 2019 2020

• Further improve Mobile Service
Revenue Share
• Expand Residential BB Revenues
contribution
GOALS DRIVERS
• “Zero-based” approach on
traditional efficiency levers
• Capture digitalization efficiency
potential
Sustain
Top Line
Growth
Expand Cash
Generation
Improve
Profitability
LONG TERM
TARGETS / KPIs
Service Revenues
Growth:
Mid to High Single
Digit CAGR ‘17-’20
EBITDA Margin:
≥40% in 2020
• Smart Capex “More with less”
approach
• Optimize Tax Rate
• Optimize Debt and Shareholders’
Remuneration
Ebitda-Capex on
Revenues:
≥20% in 2020
Capex:
~12B R$ in ‘18-’20
(~20% on Rev. in 2020)
SHORT TERM
TARGETS / KPIs
Service Revenues
Growth:
5-7% in 2018
EBITDA:
Double Digit
growth in 2018
Ebitda-Capex on
Revenues:
≥13% in 2018
TIM Brasil 2018-’20 Targets
34

35
Regulatory Updates

36
Brazilian Spectrum - Caps and Distribution
11
18
14
21
5
5
4
3
43
35
29
14
26
24
22
25
20
29
20
20
40
40
20
20
20
0 20 40 60 80 100 120 140
Oi
TIM
Claro
Nextel
Vivo
850 MHz 900 MHz 1.800 MHz 2.100 MHz 2.500 MHz 700 MHz
Band 850 MHz 900 MHz 1.800 MHz 2.100 MHz 2.500 MHz 700 MHz
Regulated Spectrum Cap
(FDD Applications)
(12.5+12.5)
MHz
(2.5+2.5)
MHz
(25+25)
MHz
(15+15)
MHz
(30+30)
MHz
(20+20)
MHz
Global Cap of 80 MHz < Σ of Sub-Caps Specific Caps
Spectrum Distribution
Caps

37
Main Regulatory Topics 2018
2Q18
May JuneApril
1Q18
February MarchJanuary
700 MHz (Available)
• >4.000 cities
GIRED for LTE
700 MHz (Switch Off)
• Curitiba
CP “Fator X”
• Contribution in
01/22
PLC 79/2016
• New Telecom
services framework
following for more
studies.
PERT
• Ongoing ANATEL
Telecom Network
Plan discussion
• Florianópolis
Spectrum Management
• Pubilc Consultantion
New PPDUR
• Public consultation of
radiofrequency public
price (auction,
secondary use and
postponement) under
discussion yet
• Porto Alegre, São Luis
e São Paulo Interior
Public Consultation
• Quality
(Conclude in 04/08)
TAC (TEF)
• Rejected by
ANATEL
PLC 79/2016
• Senate CCT
• João Pessoa
• Natal
• Maceió
• Manaus
• Teresina
• Aracaju
New RGC
• Initial debate – Pre
CP
Consulta Pública
• Área de Tarifação
do STFC
• Coleta de Dados
Setoriais
• Indicadores
Estratégicos
PLC 79/2016
• Public audience in
Senate
Public Consultation
• Reversible asset
AIR
• Pubilc Emergency
Services
• Network Security

700 Mhz and 3,5 GHz Auction
38
Available LTE TIM, #cities
2002
2005 / 2006
2011
2015
2017
2018
Blocks of 1,75 MHz
(Auction 003/2002)
TCU suspends
Auction
Auction
cancelled
Interference C
Band vs. WiMax
Auction proposed, not
started
Harmonized for IMT (WRC-
15)
• TIM coordinates tests w/ ANATEL+Telcos
• 3,5 GHz Public Consultation
Further tests
Usage Conditions
Interference management
Macro Cell applications
3,5 GHz Auction (award 2019)
TIM field trials confirm ANATEL studies C
Band vs. IMT coexistence
3,5 GHz
700 MHz
2016
2017
1Q18
2018E
2019E
2 cities + 975 cities
of which: 21 capital
916 cities
of which: 20 capitals
> 1700 cities,
included all capitals
> 3500 cities
• Rio de Janeiro
• Belo Horizonte
• Curitiba
• São Paulo
• Porto Alegre
Jun. Jul. Set.
• Florianópolis
Capitals Availabity
2018E

39
APPENDIX

40
Historical Data: P&L Pro-Forma

41
Historical Data: Operational

42
Historical Data: Cash Flow

43
For Further Information:
Investor Relations
Avenida João Cabral de Melo Neto, n 850, South Tower,
12th floor – Barra da Tijuca
22775-057 Rio de Janeiro, RJ
E-mail: ri@timbrasil.com.br
Vicente Ferreira
E-mail: vdferreira@timbrasil.com.br
Phone: +55 21 4109-3360
Pedro Yagelovic
E-mail: pybsantos@timbrasil.com.br
Phone: +55 21 4112-6990
Rafaela Gunzburger
E-mail: rgunzburger@timbrasil.com.br
Phone: +55 21 4112-5119
Luiza Macedo
E-mail: ldcmacedo@timbrasil.com.br
Phone: +55 21 4112-6828
Visit our Website
www.tim.com.br/ir

Tim meeting with investors - june 2018

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