Company’s Presentation

TIM Brasil

November, 2014

Visit our website and IR app:

www.tim.com.br/ir

AGENDA Macro & Industry Overview.......5

Recent Results……………..…………..11

Network Evolution…………………...18

Regulatory Update…………………..23

Fixed Business…………………….…...26

Business Outlook…………….….…..29

Historical Data & Others…….……33

TIM IR app

(English) TIM RI app

(Portuguese)

KNOWING TIM 3

KNOWING TIM BETTER

Gross Revenues (R$ Bln)

Customer base EoP (Million)

15,000 km fiber optical backbone

5,500 km fiber optical backhauling

Growth Via

Acquisition

Brazilian Law

“Nível” 1 “Nível” 2

Legal Requirements

Demand for transparency and

disclosures

Highest level of Corporate

Governance

Requirement of protection for

minority shareholders

100% Tag Along

Equal dividends rights

One single class of shares

Strict disclosure policy

Statutory Audit Committee:

• Report to Board of Directors

• Oversight Financial reporting

• Analyze anonymous complaints

Unique Telco company listed on the Novo Mercado

CORPORATE GOVERNANCE

TIM: A Huge Brazilian Company Presence in Brazil since 1998.

16th largest Private Company in Brazil (source: Exame Magazine - 2013).

Approximately R$32 billion of Market Capitalization.

74.7 million customers (27% Share)

The 2nd Player - Market and rev. share

More than 465,000 points of sales

More than 166 own stores

15 Customer Care Centers (16k attendants)

~13,500 Antennas

3,432 cities covered

95% of urban pop. covered

51,700 km of optical fiber network

~12,520 employees

23,000 indirect jobs

R$10.4 billion in taxes payments in 2013

R$3.9 billion invested in 2013

Sales

Network

Social &

Economic

GROWTH STRUCTURE

25 28

30

2011 2012 2013

4,7 5,0

5,2

2011 2012 2013

64 70

73

2011 2012 2013

EBITDA (R$ Bln)

Macro & Industry Overview

MACRO SCENARIO OUTLOOK (1/2)

• Market consensus shows a softer growth in GDP.

• Consensus expects a deterioration in overall macroeconomic scenario on the medium term.

• Market expects that the government is unlikely pushing inflation towards the center of the target.

• With inflation and FX Rate going up, SELIC is expected to grow, specially after the recent decision to rise the rate to 11.25% p.y.

GDP Forecast (% YoY Growth)

Inflation Forecast (IPCA: 12 months)

Interest Rate Forecast FX Rate Forecast (R$/U$ - year average) (% Selic Target p.y. – year average)

Source: BaCen/Bloomberg

5.9 6.3 6.3

5.9

4.5

2013a 2014e 2015e 2016e

10.0 11.0

11.5 12.3

2013a 2014e 2015e 2016e

2.2

2.4 2.5

2.4

2013a 2014e 2015e 2016e

2.3

0.3

1.2

2.3

0.7

3.0

4.0

2013a 2014e 2015e 2016e

Government’s Target

Government projection Market Consensus

Government projection Market Consensus

MACRO & INDUSTRY OVERVIEW 5

MACRO SCENARIO OUTLOOK (2/2)

• Market expects the unemployment rate to increase in 2015, as jobs creation remains low.

• Even with a high number of indebted families, families in default figure has been decreasing, probably guided by the constant reduction of unemployment and real income gains, specially on classes C and D.

Unemployment (%)

Formal Jobs Creation* (In Thousand)

Indebted Households* Families on Default (% of total) (% of total)

Source: Banco Central/Bloomberg

61.6 58.9 61.4 63.2

3Q11 3Q12 3Q13 3Q14

-307

303

189 237

4Q13 1Q14 2Q14 3Q14

24.3

19.1 20.6

19.1

3Q11 3Q12 3Q13 3Q14

6.0

5.4 5.4

4.9 5.0

5.6

6.1

3Q11 3Q12 3Q13 3Q14 2014e 2015e 2016e

* Families that declared to have debts on the categories of: credit card, stores bills, personal loans, car loans and insurance and postdated check

* Families that declared to have debts overdue for more than three months

*Number of job positions with the complete registration of the employee

MACRO & INDUSTRY OVERVIEW 6

TIM represents 30% of the industry mobile revenue* while has 27% of the market share

TIM

Source: Anatel and Players balance sheet

Vivo

Claro Oi

Mobile Fixed Fixed BB Pay-TV Group

Customers 2Q14 (000´s) 74.203 665 121 n.d. 74.989

Market share 2Q14 26,9% 1,5% 0,5% n.d. ---

Net Adds 2Q14 (000´s) 286 - 19 n.d. 305

Net Adds 12M (000´s) 2.008 31 61 n.d. 2.100

Net Revs FY13 (R$ Mln) 19.264 657 19.921

Mobile Fixed Fixed BB Pay-TV Group

Customers 2Q14 (000´s) 79.357 11.035 4.370 688 95.450

Market share 2Q14 28,8% 24,1% 18,8% 3,6% ---

Net Adds 2Q14 (000´s) 892 333 36 43 1.305

Net Adds 12M (000´s) 3.158 619 345 175 4.296

Net Revs FY13 (R$ Mln) 23.002 11.720 34.722

Mobile Fixed Fixed BB Pay-TV Group

Customers 2Q14 (000´s) 68.776 11.289 7.045 10.106 97.216

Market share 2Q14 24,9% 24,7% 30,3% 53,3% ---

Net Adds 2Q14 (000´s) 27 189 220 230 667

Net Adds 12M (000´s) 2.303 1.133 905 1.121 5.462

Net Revs FY13 (R$ Mln) 12.773 20.424 33.197

Mobile Fixed Fixed BB Pay-TV Group

Customers 2Q14 (000´s) 51.081 17.023 6.567 887 75.558

Market share 2Q14 18,5% 37,2% 28,3% 4,7% ---

Net Adds 2Q14 (000´s) 502 -240 3 58 304

Net Adds 12M (000´s) 1.373 -1.307 17 - 16 48

Net Revs FY13 (R$ Mln) 9.290 19,132 28.422

The mobile segment represents 75% of the industry access growth

*Mobile revenue considers only the 4 major players

Fixed / Mobile Fixed BB Fixed voice & BB / TV Mobile

Fixec BB/ TV Fixed Mobile

BRAZILIAN TELCOS X-RAY

Fixed / Mobile

7

122.6

23.2

56% 35.2 mi

43% 27.0 mi

62.8 mi

Possess Internet connection

Does NOT Possess Internet connection

Total Households

38% High cost

43% of total active connections have speed below 2Mbs

3%

37%

51%

91%

MARKET STRUCTURE CHANGING TOWARDS DATA USAGE

Households with internet connection (%)

With Telephone

Only mobile phone

Mobile and fixed phone

Households Profile

Fixed phone only

Purchase Power

Salaries up to R$1.2k

Salaries up to R$3.1k

Average Cost

32 mln

2 mln

81 mln

106 mln

23 mln

53% of pop.

70% of pop.

Source: PNAD 2012, CETIC.br ‘ TIC Domicílios 2013, Company estimates

Re-visiting Market Structure...

Market Data Revenues Growth 2016 vs. 2012:

> 13 bln Reais on Mobile (+100%)

> 7 bln Reais on Fixed (+35%)

1

2

57 mln

3

83 mi

~R$40

~R$100 Fixed: Voice and Broadband Entry level plan

Mobile: Voice and Data PTIM’s entry level plan

4 Access Growth (users in mln)

Fixed

Mobile

2009 2010 2011 2012 2013 Jul/14

+ 5.2X

Reasons for not having Internet:

12% Lack of coverage

…with room to grow

MACRO & INDUSTRY OVERVIEW 8

Widespread use of Social Media (Social Network Users in Brazil 2011-2017)

BRAZILIAN INTERNET USAGE BOOM Internet Penetration in South America (Internet users per 100 inhabitants)

Strong adoption of Instant Messaging (WhatApp mln users)

High Penetration of E-commerce (E-commerce revenues in Bln US$)

8.4

11.0

17.0

2010 2011 2012

Amazon lauched operations in Brazil

in Dec/12

83 mln Internet users – Brazil is the 5th largest nation in the world of

internet users 66%

60% 59% 56%

46% 44% 41% 37%

32% 32% 30% 24%

Arg Col Chi Uru Bra Ecu Vem Per Guy Sur Bol Par

56.1 66.2

78.3 88.3

97.8 104.2

110.0

2011 2012 2013 2014 2015 2016 2017

#2 in Facebook active users (76mln) only after US

#2 in Twitter users (41mln) only after US

2nd largest market outside US

40

38

32

31

25

17

13

11

3

India

Brazil

Mexico

Germany

Spain

UK

Argentina

Russia

France

28% of mobile users in Brazil use Instant Messaging

apps

Source: SocialBakers, e-Marketer, Semiocast, G1.com, Folha de São Paulo

MACRO & INDUSTRY OVERVIEW 9

465 mln worldwide users

List of selected countries as of

Feb/14

53% 64% 79%

90%

2006 2007 2008 2009

4% 12% 11%

52%

2011 2014

Tablet

Smartphone

56% 48% 42%

34% 27% 27% 23%

• Incoming calls only device

Mobile Penetration (% over population)

DATA GROWTH IS THE NEW CHALLENGE

Data Penetration (% of data over total revenues in 3Q13)

248 212

166 162 140 139 91

MOU in 2008 (minutes)

• Still a lot of phones without data access • Wi-Fi only devices

PCs, Notebooks, Feature Phones

MACRO & INDUSTRY OVERVIEW 10

...was similar to the challenge in data growth now

Challenge in voice growth in 2009…

Goal: increase voice usage Challenge: deliver the best

experience in mobile internet

Source: Anatel and IBGE Source: IDC

Source: Global Matrix

High Growth

“Fear” to use

Low Usage

Handset Sales Share

Recent Results

3Q13 3Q14

+6%

3rd QUARTER IN FEW: RESULTS OVERVIEW Financial Highlights

Operational Highlights

Business generated revenues at a good pace

1

Net Mobile Revenues

(ex-incoming)

3Q13 3Q14

+5%

EBITDA at a solid performance 2

EBITDA reached

R$1,332 mln in Q3

1 New offers

2 Bad debt under control

Bad debt as % of gross revenues

Increasing data penetration 3

% of data users over total base

4 Strong performance in 4G market share

4G Market Share

0.7% 0.6%

1.1% 1.1% 0.8%

3Q13 4Q13 1Q14 2Q14 3Q14

-22.3% -21.9% -22.9% -20.5%

-2.9%

3Q13 4Q13 1Q14 2Q14 3Q14

Improving fixed business (fixed business net revenues Δ% YoY) 5

+19 p.p.

Strong cost control (total opex Δ% YoY) 4

8.8% 2.3%

-2.9% -7.2% -8.1%

3Q13 4Q13 1Q14 2Q14 3Q14

33%

39% 43%

3Q13 2Q14 3Q14

Net Income 3

Net Income totaled

R$348 mln in Q3

3Q13 3Q14

+11% +6.4%

+10 p.p.

Source: Anatel

26%

30%

Jul/13 Jul/14

+4 p.p.

3Q RESULTS 12

1,283

1,378

3Q13 3Q14

Service EBITDA (ex-handset business) (R$ mln; %YoY)

BUSINESS FUNDAMENTALS Core Business Evolution…

…Overcoming Challenges

Mobile Service Net Revenues (% YoY)

Service EBITDA Margin (ex-handset business) (% YoY)

(Local + LD + VAS

+ Others)

Business Received

3Q13 3Q14

Business Generated

1 MTR cut impact on revenues (YoY performance)

(Incoming Voice + SMS)

+7.4%

30% 34%

3Q13 3Q14

+3.6 p.p.

2 SMS Outgoing Revenues (YoY performance)

-18%

-28% -27%

1Q14 2Q14 3Q14

Net revenues from MTR

3 Macro Environment

Brazilian GDP Growth (%YoY)

Source: IBGE; CNC

Indebted Households (% of total)

1S13 1S14

2.7%

0.5%

A market trend

Greater potential for data growth usage

1.2%

-8.2%

-19.4%

1Q14 2Q14 3Q14

+5%

-34%

Operating margin

improvement

61% 63%

3Q13 3Q141H14 1H13

3Q RESULTS 13

45%

39%

26% 30%

17% 20%

12% 10%

DRIVEN BY INNOVATION

Customer Base (mln users)

PREPAID MOBILE ACCOUNT/ MONEY

o Partnership: TIM, Mastercard and Caixa Econômica Federal

o Focus on unbanked population ( >50% of prepaid base)

NEW MUSIC PLATFORM

o Partnership TIM and Deezer (top global streaming platform)

o More than 35 million music available for download

o Maintaining leadership position in the mobile music industry in Brazil

Aug/12 Aug/13

TIM

Source: ANATEL

Aug/14

P1

P3

P4

Jul/13 Jul/14

3G Market Share (%; mln users)

4G Market Share (%; thd users)

30.1

31.4

42.7

16.8

123 mln

Jul/13 Jul/14

TIM

1,437

1,101

735

364

3.7 mln

TIM

Source: ANATEL Source: ANATEL

INTERNET SHARING PLANS

o Up to 4 devices

o No additional charges

WEEKLY SERVICE PACKAGE o Voice + Data + SMS o R$ 7 per week

NEW M2M PLANS o New data packages

launched for M2M services

R$ 0.75 DAILY OFFER

o Expansion to new regions: PR, SC, MA, RJ

o Covering most of the country

Adding Value Through Innovation

NEW APP FOR LANGUAGE COURSES o Games and quizzes help

students developing English skills

blah COMMUNICATION APP

o Integrated communication (VOIP, IM, SMS) App

o First ad campaign

76.5 77.1 79.7

69.4 72.9

74.7

63.2

67.1 69.3

48.0 50.0 51.3

23% 25%

25% 26%

40%

35%

11% 14%

3Q RESULTS 14

67% 77%

3Q13 3Q14

3Q13 3Q14Jul - Aug/13 Jul - Aug/14

24

32

3Q13 3Q14

MAINTAINING STRONG DATA PACE

Data Adoption

Increasing Data Penetration

Smartphone Penetration Over Customer Base (%; ∆ YoY)

Smartphones Share over New Sales (%; ∆ YoY)

Data Users (mln users; % YoY)

+32%

BOU: Bytes of Use (megabytes)

Days of Use

+40% +22%

43 mln to go!

28 mln untapped market

15 mln with data handset

Data Opportunity over Customer Base

32 mln data users

1Q14 2Q14 3Q14

25% 27% 29%

% over total gross mobile service

revenues

Mix of Data Gross Revenues (R$ mln; %YoY)

SMS

Web

1,500

+29% +39%

+45% +80%

∆ %YoY growth

1,578

Content & Others

1,677

+33%

+72%

74.7 mln customer base

+23% +20% +22%

+10 p.p. New Data World

Usage Increase

Penetration Increase

25%

44%

3Q13 3Q14

+20 p.p.

3Q RESULTS 15

3Q13 3Q14

~0.7% ~0.8%

3Q13 3Q14

4,045

180

Tho

usa

nd

s

4,207 4,045 +149

Tho

usa

nd

s

+0.4%

FINANCIAL RESULTS ANALYSIS (1/2) Service Net Revenues (R$ mln; % YoY)

Reported Revenue

3Q13

Reported Revenue

3Q14

MTR Impact

-3.8%

4,225

‘Pro forma’ Revenue in 3Q14

-306 -4.5

ΔYoY +4.7% -34.5% -2.9%

Δ Others Δ Business Incoming

Δ Business Generated

Ex-MTR

1,332

109

Tho

usa

nd

s

EBITDA (R$ mln; % YoY)

1,252

Reported EBITDA 3Q13

Reported EBITDA 3Q14

+151 -71

Δ Opex/ Others

Traffic/Data Δ Contribution

Margin

24.6%

30.5%

1,332

27.4%

34.1%

EBITDA Margin

Service EBITDA Margin

+4.5% +3.4%

MTR Impact

+15.1%

+6.4%

1,441

‘Pro forma’ EBITDA in 3Q14

ΔYoY

Ex-MTR

Efficient Cost Control

Interconnection Cost (Δ% YoY)

Leased Lines Cost (Δ% YoY)

Bad Debt/Sales (% over gross revenues)

stable

3Q13 3Q14

-36.2%

3Q13 3Q14

-1.8%

Mobile First Margin Analysis (% YoY)

+6 p.p. Strong first margin

expansion showing core business improvement

Margin expansion driven by data and VAS (content & others)

3Q RESULTS 16

306 372

386 366

315 348

9M13 9M14

3,980 -2,614*

- 1,274

182 275

50%

88%

50%

12%

9M13 9M14

1,446

4,781 3,335

Tho

usa

nd

s

791

4,470 3,679

1,749 1,749

-163

+438 mln

+30%

FINANCIAL RESULTS ANALYSIS (2/2) Net Income Evolution (R$ mln; % YoY)

Net Debt (R$ mln; % YoY)

EBITDA

Debt Cash Net debt

Sep/13 Sep/14

Debt Cash Net debt

+63% -45%

Infrastructure Investment Mix (as % of capex)

Cash Flow - 9 months (R$ mln; R$ YoY)

YoY

Net debt/EBITDA 12M: 0.14x

BNDES Loan

CAPEX Δ WC OFCF 9M14

*Considering R$3 mln of LT Amazonas leasing adjustment

OFCF 9M13

LT Amazonas Leasing

6,219 5,428

2G

3G + 4G +38 p.p.

∆ YoY Technology

2Q

1Q

+10.6%

% YoY

3Q

1,007 1,086

+21.6%

-5.2%

+7.9%

1H14 3Q14

512

-1,786

2013 2014

3Q RESULTS 17

Network Evolution

INFRASTRUCTURE (R)EVOLUTION (1/3)

2016 MASSIVE LD BACKBONE

65,000 KM OF FIBER

2013 FIBER TO THE

AMAZON

46,000 KM OF FIBER BY YE13

Fiber to the site / Mobile Broadband Project Key to Data Growth

Targeting 38 cities in 2013,+100 cities till 2016.

From 2-8 to +100 Mbps.

LTE Ready.

Macro coverage fine tuning.

Focus on IP infrastructure, caching, peering.

INTELIG 15,000KM

2009 INTELIG

ACQUISITION

New backbone routes- Increasing resilience.

82% urban population

2013 2014 2015 2016

95% urban population

#NodeB / eNodeB (3G + 4G)

# BTS (2G)

2012 2013 2014e 2015e 2016e

New Sites Including

Small Cell.

POP MW

POP MW POP MW

POP MW

BSC-RNC Site

POP MW

2013 2014 2015 2016

LTE* 3G 2G

Fiber base Infrastructure

Backhauling Evolution Increased Coverage and Access Capacity

(# new elements)

Capex Evolution Towards Data (% of total Capex)

Small Cell Approach (# new elements)

NETWORK EVOLUTION 19

39

81

2013

1Q14

2Q14

3Q14

900 Mhz rollout according to plan (above 600 sites using the new frequency)

Expanding backhauling

INFRASTRUCTURE (R)EVOLUTION (2/3) Mobile Broadband Update

Cities Covered with MBB project

% of urban population covered

Quick incident resolution: from 56% to 76% within 8h

Reacting faster to network problems - faults opened within the target time: from 85% to 94%

Agreement with a tower company

Project to install more than 150 small cells in gas stations in 3 cities

Small cell installed inside Totem

Network Hiring + Insource Project

Innovative Coverage Expansion Improving Quality and 4G Services (e.g.: SP)

Reduction in dropped call rates and better overall performance

Higher average throughput rates

Improvement in indoor coverage

Increase in data and voice traffics

Expanding # of people in the Network team

From third party TO insource Network Control Center

30%

31%

32%

Source: ANATEL app

36%

Investing Efficiently

Big Data analysis for capex allocation;

Antenna level return analyses (IRR and payback)

99.0%

97.95%

97.53%

98.36%

Voice Access # Antennas

NETWORK EVOLUTION 20

3,153 3,106 3,085

3,055

TIM P2 P3 P1

INFRASTRUCTURE (R)EVOLUTION (3/3) Network in Numbers

4G Sites in state capitals

Ran Sharing

Smart Approach

Source: ANATEL

Number of WIFI & Small Cells

Source: Company

714

1,105

4Q13 1Q14 2Q14 3Q14

Number of 3G Sites

9.3% growth in 9M

Coverage: 79.1% of urban population

Source: Company

9,074

9,920

4Q13 1Q14 2Q14 3Q14

NETWORK EVOLUTION 21

3,871

3,386

2,983 2,836

2013201220112010

19% 17% 20%

% over sales

18%

Copper

(2-8Mbps)

Before FTTS After FTTS

Metro Ring

From Copper

To Fiber based

Fiber to the site expansion to ~100 cities

CAPEX Analysis

CAGR

11%

2G

3G

4G

R$2,983 ~R$3,800

2G

3G

Capex per Technology (R$ mln)

2011 2014e

Capex Evolution (R$ mln)

Regulatory Update

REGULATORY UPDATE (1/2)

REGULATORY UPDATE 23

700MHz Auction Results

TOTAL AMOUNT

o Auction totaled R$5.85 billion, 24% lower then

the R$7.7 billion expected for minimum prices

for all blocks.

FINAL PRICE

o The EAD Contribution of R$890.1 million related to unsold

blocks will be distributed proportionately among the sold

blocks and will be discounted of the Public Price.

Block 1 Block 2 Block 3 Block 5 Block 4 Block 6

(10+10) MHz (10+10) MHz (10+10 MHz) (10+10) MHz (10+10) MHz (10+10) MHz

In R$ Million

Minimum Price 1,928 1,928 1,928 30 1,893 5 7,712

Winning Bid 1,947 1,947 1,928 30Unsold

(1st + 2nd rounds)

Unsold

(1st + 2nd rounds)5,852

Premium 1.00% 0.99% 0.00% 0.02% - - -

EAD 903.93 903.93 903.93 13.86 887.59 2.48 3,616

Total 

National Regional

1st Round

(10+10) MHz cap

5800 Mhz

2100 Mhz 850 Mhz

700 Mhz < 700 Mhz

0 2 4 6 8 10

Number of BTS

20 15 10 7 5 2

BTS Range (km)

0.52 0.78 0.83 1.07 1.13 1.18 1.22 1.28 1.29 1.29 1.48

2.58

DEN NZL Spain Brazil GER PORT EUA Taiwan Italy France AUS Canada

Average = 1.22

AUCTION PLAYERS

o Oi and Sercomtel did not

participate in the auction.

Spectrum acquisition at fair price; (Price in USD/MHz/Pop. adjusted for GDP)

Better Coverage (Indoor and Rural)

3rd week • Return of

the MHz Bond

Estimated 700 MHz Auction Roadmap

Aug/6 • TCU’s

precautionary measure preventing the auction rules publication

Jul/17 • Approval of

auction terms and interference rules

• Definition of Analog TV switch-off dates

Aug/21 • Auction publication

Aug/16 • ANATEL’s

auction rules revision

2nd week • Authorization

extracts published in DOU

Oct/16 • Counterarguments

by TIM

4th week • EAD constitution

4th week • GIRED institution (One TIM representative)

4th week • EAD’s 1st 30%

payment

July/14

Set/12 • Clarification

from ANATEL • Bid bond issuing

Sep/1 • Clarifications

request • Administrativ

e Appeal

Aug/20 • TCU

approval

Oct/13 • Nor TV’s

appeal (MMDS operator) against CEL

3rd week • Call for

Authorization signature

4th week • Performance

Bond (EAD) issuing

Oct/7 • Auction Special

Commission; Classification and Award decision published in D.O.U.

4th week • Proof of good

standing documentation filing

• GO/NO GO Decision: Additional Commitments

… March/15 April/15

Sep/30 • Auction

Sep/23 • Documentation • Bid bond; and • First bid filing

September/14 October/14 December/14

REGULATORY UPDATE (2/2)

August/14

REGULATORY UPDATE 24

2nd week • ANATEL’s

Board Award approval

1st week • Authorization

signature • Public Price

payment

November/14

Fixed Business

3Q13 4Q13 1Q14 2Q14 3Q14

TIM SOLUÇÕES CORPORATIVAS: BUSINESS REBOUND Turnaround on fixed business in place

2013 2012

-

2014

+

EBITDA-CAPEX Net Revenues (with intercompany)

2013 2014

1Q14 2Q14

o New business unit

organization

o IT renewal plan

o Multiservice

network launch

o New branding

o New offers and

product launch

o Restructured sales

force

4Q14

o Sales and customer

service improvement

3Q14

Financial Performance

o Sales multi-channel

Improvement

o New offers and

product launch

o MTR reduction

Revenues from New Sales (R$; YoY)

Revenue rebound Sales growth Market repositioning Infrastructure reinforcement

Governance / Efficiency Business Priorities: Business development Quality and Process

+5x

Organization restructuring

Dedicated B.U. to all

business customer Fixed + mobile

integration

FIXED BUSINESS 26

36.7

38.2

3Q13 3Q1421

13

3Q13 3Q14

Accelerating Operational Performance…

LIVE TIM: SPEEDING UP GROWTH

27

43

120

3Q13 3Q14

Customer Base (000 users)

Source: Anatel

881

1,366

3Q13 3Q14

Netflix Broadband Ranking (average streaming speed representation)

3Q13 3Q14

ARPU (R$; YoY%)

… with Support of Quality Experience

Addressable Households (000 HH)

Source: Company

+2.8x +55%

+32%

New Line Payback (months)

-38%

Gross Adds (000 users)

18

31

3Q13 3Q14

+74%

Live TIM Net Adds Share (% of SP and RJ market additions)

Average Speed of New Sales (mbps)

+4.1%

16%

31%

Aug/13 Aug/14

Source: Company

FIXED BUSINESS 27

Business Outlook

CONCLUSION

29

Q3 Conclusions: A good balance between objectives

Perspectives: Moving the plan forward

Strategic… Financial… Operational…

EBITDA

Net Income

+6.4% YoY

+5% YoY

+11% YoY

MBB in 81 cities

OPEX Control

Prepaid leadership

Infrastructure growth

Evolving revenue profile Renewed Mission/ Purpose/Values

New 3-year plan

“To connect and take care

of every customer, so

everyone can do more”

o Industry leadership

o Long term commitment

o 4G license 700MHz

o Tower sale supporting investment plan

Quality

Business Generated

TIM Protagonist

• VOICE

• SMS

• MTR

• DATA

• DIGITAL SERVICES

o Data and digital services leadership

o Infrastructure

o Customer base value

o Customer experience

o One TIM initiative

Data Users (mln users)

Data + VAS (ex-SMS)

Smartphones (over total base)

32 mln 32% YoY

44% +19 p.p. YoY

R$1.3 billion +49% YoY

BUSINESS OUTLOOK 29

21.3

27.5

2012 2013 2016e 2012 2013 2016e

+xx%

OFFER EVOLUTION

136 148

>170

2012 2013 2016e

18% 21%

>40%

VAS Gross Revs.

VAS/Revs. 30% 37% >50%

43%

55%

>75%

2012 2013 2016

+xx% +29%

+22%

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

Voice MOU (minutes)

Data Users (% of Data Users in CB; million users)

VAS Revenue Growth (% of Mobile Services Gross Revenues; R$ mln)

BUSINESS OUTLOOK 30

TIM PART: 2014-2016 GUIDANCE

Total Net Revenues

EBITDA

CAPEX

18,764 19,921

2012 2013 2014e 2015e 2016e

5,012 5,207

2012 2013 2014e 2015e 2016e

R$ million

R$ million

626

3,139

3,871

3,487

384

2012 2013 2014e 2015e 2016e

R$ million

Infrastructure

Others/Licenses

3,765

Guidance

2013-2016 CAGR:

Mid Single Digit Growth

2013-2016 CAGR:

Mid Single Digit Growth

Total CAPEX 2014-2016:

~R$11 billion*

*Does not consider 4G licenses (700Mhz).

BUSINESS OUTLOOK 31

Historical Data & Others

RECENT TOWERS DEALS

HISTORICAL DATA & OTHERS 33

QUARTERLY HISTORICAL DATA (R$ THOUSAND)

HISTORICAL DATA & OTHERS 34

ANNUAL HISTORICAL DATA (R$ THOUSAND)

HISTORICAL DATA & OTHERS 35

HISTORICAL DATA: OPERATIONAL & FINANCIAL RATIOS

ROA: NOPLAT/Avg. Total Assets. Calculation considers organic Net Income and EBITDA

HISTORICAL DATA & OTHERS 36

Stock Performance (base 100)*

STRUCTURE AND STOCK PERFORMANCE

*Last price as of 02/14/2014 HISTORICAL DATA 37

HISTORICAL DATA & OTHERS 37

80

90

100

110

120

130

Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14

TSU -0.2%

TIMP3 +4.5%

Ibovespa +5.1%

Cofins PIS/ PASEP ICMS Fistel Fust/

FUNTEL

TotalTotal Fust/ FUNTEL

PIS/ PASEP

ICMS Cofins Fistel

% Gross Revenues

TELCOS’ TAX BURDEN & HIGH INVESTMENTS

3% ~1%

28%

~5% 1.5% ~39%

32% of Revenues

Taxation represents almost 40% of companies gross revenues.

Tax Burden Composition Telecom Industry Tax Payments1

(R$ Bln)

Telecom Industry Investments2 (R$ Bln)

HISTORICAL DATA & OTHERS 38 Source: players Balance Sheet

1 Considers TIM, Telefonica, Oi and AMX 2 Considers TIM, Telefonica, Oi, AMX and GVT

45.7 46.0

2012 2013

36.8

38.4

2012 2013

Investor Relations Team

Avenida das Américas, 3434 - Bloco 01

6° andar – Barra da Tijuca

22640-102 Rio de Janeiro, RJ

E-mail: ri@timbrasil.com.br

Rogério Tostes

E-mail: rtostes@timbrasil.com.br

Phone: +55 21 4109-3742

Vicente Ferreira

E-mail: vdferreira@timbrasil.com.br

Phone: +55 21 4109-3360

Leonardo Wanderley

E-mail: lwanderley@timbrasil.com.br

Phone: +55 21 4109-4017

Rodrigo Godoy

E-mail: rcgodoy@timbrasil.com.br

Phone: +55 21 4109-3446

Luiza Chaves

E-mail: luchaves@timbrasil.com.br

Phone: +55 21 4109-3751

Visit our Website

www.tim.com.br/ir

Safe Harbor Statements

Statements in this presentation, as well as oral

statements made by the management of TIM

Participações S.A. (the “Company”, or “TIM”), that are

not historical fact constitute “forward looking

statements” that involve factors that could cause the

actual results of the Company to differ materially from

historical results or from any results expressed or

implied by such forward looking statements. The

Company cautions users of this presentation not to

place undue reliance on forward looking statements,

which may be based on assumptions and anticipated

events that do not materialize.

SAFE HARBOR AND IR CONTACTS

SAFE HARBOR & IR CONTACT 39