Telecom Argentina S.A. announces consolidated annual period ('FY12') and fourth quarter results for fiscal year 2012 ('4Q12')

   Telecom Argentina S.A. announces consolidated annual period ('FY12') and
             fourth quarter results for fiscal year 2012 ('4Q12')

PR Newswire

BUENOS AIRES, Argentina, Feb. 28, 2013

BUENOS AIRES, Argentina, Feb. 28, 2013 /PRNewswire/ --

  oConsolidated Revenues amounted to P$22,117 million (+20% vs. FY11); Fixed
    Internet +28% vs. FY11; Fixed Data +26% vs. FY11; and Mobile business in
    Argentina +22% vs. FY11.
  oMobile subscribers in Argentina: 19 million; +0.8 million (+4% vs. FY11).
  oMobile Value Added Services in Argentina (Internet and Data): +33% vs.
    FY11; 53% of Service Revenues.
  oMobile ARPU reached P$57.7 per month in FY12 (+12% vs. FY11).
  oADSL ARPU increased to P$102.3 per month in FY12 (+18% vs. FY11); monthly
    churn reached 1.4% in FY12.
  oOperating Income Before Depreciation and Amortization reached P$6,570
    million (+10% vs. FY11), 30% of Net Revenues, after a one time charge of
    P$ 90 million.
  oOperating Income amounted to P$3,966 million.
  oNet Income amounted to P$2,732 million (+7% vs. FY11). Net Income
    attributable to Telecom Argentina amounted P$2,685 million (+7% vs. FY11).
  oNet Cash Position: P$3,648 million, an increase of P$964 million vs. FY11
    due to the cash generation and after Telecom Argentina´s cash dividend
    payment of P$807 million.
  oCapex reached P$3,257 million in FY12 (+2% vs. FY11), 15% of Consolidated
    Revenues.



Telecom Argentina
(in million P$, except where noted)            As of December, 31
                                                2012       2011     Δ $   Δ %
Revenues                                        22,117     18,498   3,619  20%
 Mobile Services                     16,094     13,169   2,925  22%
 Fixed Services                      6,023      5,329    694    13%
Operating Income before D&A                   6,570      5,993    577    10%
Operating Income                                3,966      3,857    109    3%
Net Income attributable to Telecom Argentina    2,685      2,513    172    7%
Shareholders' equity attributable to Telecom    9,959      8,021    1,938  24%
Argentina
Net Financial Position - Cash                  3,648      2,684    964    36%
CAPEX                                          3,257      3,192    65     2%
Fixed lines in service (in thousand lines)      4,128      4,141    (13)   0%
Mobile customers (in thousand)                  21,276     20,342   934    5%
 Personal (Argentina)                18,975     18,193   782    4%
 Nucleo (Paraguay) -including Wimax  2,301      2,149    152    7%
customers-
Broadband accesses (in thousand)                1,629      1,550    79     5%
Average Billing per user (ARBU) Fixed           48.2       45.7     2.5    6%
Telephony / voice (in P$)
Average Revenue per user (ARPU) Mobile          57.7       51.4     6.3    12%
Services in Arg. (in P$)
Average Revenue per user (ARPU) ADSL (in P$)    102.3      87.0     15.3   18%



Telecom Argentina ("Telecom") - (NYSE: TEO; BASE: TECO2), one of Argentina's
leading telecommunications companies, announced today a Net Income of P$2,732
million for the annual period ended December 31, 2012, or +7% when compared to
the same period last year. Net income attributable to Telecom Argentina
amounted to P$2,685 million (+7% vs. FY11).

During FY12, Consolidated Revenues increased by 20% to P$22,117 million
(+P$3,619 million vs. FY11), mainly fueled by the Mobile Services, Broadband
business and Fixed Data. Moreover, Operating Income amounted to P$3,966
million (+P$109 million vs. FY11).

Consolidated Operating Revenues

Mobile Services

Clients continued to increase in FY12, reaching 21.3 million as of the end of
December 2012, representing an increase of 0.9 million (+5%) since December
31, 2011.

The actions developed to increase the usage of value added services ("VAS"),
such as innovative offers to clients and equipments sales, allowed Personal to
increase consolidated revenues to third parties to P$16,094 million (+22% vs.
FY11).

Telecom Personal in Argentina

As of December 31, 2012, Personal reached 19 million subscribers in Argentina
(+4% or +0.8 million vs. FY11), improving its market position. It is worth
noting that the overall subscriber base mix continued to improve reaching a
33% participation of the postpaid segment (+7% vs. FY11).

In FY12, Revenues to third parties reached P$15,227 million (+P$2,772 million
or 22% vs. FY11) while Service Revenues (excluding equipment sales) amounted
to P$13,312 million (+21% vs. FY11), with 53% corresponding to value-added
services ('VAS') revenues (vs. 48% in FY11). VAS revenues increased by 33% vs.
FY11.

During the quarter, Personal consolidated its position in the mobile industry
with an innovative VAS proposition where unlimited internet through mobile
devices continued to be massified.

During FY12, the overall traffic of voice minutes increased by 7% vs. FY11.
SMS traffic (incoming and outgoing charged messages) continued to increase,
although at a slower pace, due to other Internet alternatives provided by
Personal. The traffic climbed to a monthly average of 5,769 million in FY12
from 5,587 million messages in FY11 (+3% vs. FY11). Due to the VAS usage and
certain price adjustments during 4Q12, the Average Monthly Revenue per User
("ARPU") increased to P$57.7 during FY12 (+12% vs. FY11).

Initiatives

During 4Q12, Personal continued with its strategy focus of maintaining
clients' fidelity and capturing new ones since number portability was
implemented. In that sense, Personal continued with its strategy in terms of
service convenience, through special promotions in prepaid credit recharges
and new packages customized for Club Personal´s members.

Related to handsets, accompanying the development of Open Digital Television
(TDA: Television Digital Abierta), Personal has offered to its clients certain
handsets suitable to this system.

Furthermore, Personal continued expanding its commercial network by opening
new commercial offices focusing in a clients´ experience model.

Personal continued its brand positioning associated to music by organizing
several events and concerts, such as the eighth edition of ¨Personal Fest¨,
which brought together more than 40,000 fans in two days. In addition,
unprecedented in LatAm, the festival was broadcasted via Youtube Argentina
webpage allowing more than 500,000 fans to enjoy the festival online.

Moreover, Personal outstands for good image in the general brands evaluation
of favorite brand, consolidating its general leadership and increasing the gap
with its competitors in the youth segment, where Personal is market leader.

Telecom Personal in Paraguay ("Nucleo")

Nucleo's subscriber base reached 2.3 million clients (+7% vs. FY11). Prepaid
and postpaid customers represented 81% and 19% (vs. 18% in 3Q12),
respectively.

Personal's subsidiary in Paraguay continued growing supported by a commercial
offer strategy that leveraged its leadership in the mobile Internet market.
The Company generated revenues equivalent to P$867 million during FY12 (+21%
vs. FY11). Moreover, the level of ARPU remained stable at Gs.27,100
(equivalent to P$ 32) vs. FY11. VAS represented 50% of FY12 service revenues.

Initiatives

During February 2013, Personal launched 4G technology (LTE, Long Term
Evolution) in Paraguay. The Company is the first and only in Paraguay offering
LTE services and second in Latam. LTE allows data transfers at high speeds and
achieves an interactive user experience. LTE has consolidated, in global
terms, as the next technology generation that will sustain innovation and
developments in mobile services.

Initially, 4G technology will be available in the city of Asunción for mobile
broadband plans and then will be extended to the rest of the country.

Fixed Services (Voice, Data & Internet)

During FY12 revenues generated by fixed services amounted to P$6,023 million,
+13% vs. FY11; with Internet (+28% vs. FY11) and Data revenues (+26% vs. FY11)
growing the most in relative terms in this segment.

Voice

Total Revenues for this service reached P$3,214 million in FY12 (+4% vs.
FY11). The results of this line of business continued to be affected by frozen
tariffs of regulated services enforced by the Argentine Government in 2002.

Revenues generated by Measured Services totaled P$1,306 million, an increase
of P$64 million or +5% vs. FY11 mainly due to the incorporation of flat rate
packs of local calls.

Monthly Charges and Supplementary Services reached P$1,032 million, an
increase of P$75 million or +8% vs. FY11 due to higher revenues in non
regulated supplementary services and more than 4.1 million of lines in
service.

The average monthly bill per user (ARBU) reached P$48.2 in FY12 vs. P$45.7 in
FY11.

Interconnection revenues reached P$516 million (-2% vs. FY11). Meanwhile,
other revenues totaled P$360 million (-5% vs. FY11).

During the last quarter of 2012, continued with a mass campaign to increase
Aladino handset sales.

Data and Internet

Revenues related to Internet totaled P$1,993 million (+ P$440 million or +28%
vs. FY11), mainly due to the continued expansion of broadband services.

Data revenues amounted to P$735 million (+26% vs. FY11), where the focus was
to strengthen Telecom's position as an integrated ICT provider, with a wide
variety of services.

As of December 31, 2012, Telecom surpassed 1.6 million ADSL accesses (+5% vs.
FY11). These connections represented 39% of Telecom's fixed lines in service.
In addition, ADSL ARPU reached approximately P$102.3 in FY12, +18% when
compared to FY11 and the monthly churn rate was 1.4% in FY12, continuing at
low levels.

During 4Q12, Arnet launched the campaign "Opinologos" offering Arnet 6Mb WIFI
at P$100 per month during the first six months of service with the possibility
of extending the promotion to twelve months if the service was contracted
online.

Furthermore, during the quarter, a new campaign was launched outstanding some
of the multiple uses of "Arnet WIFI with Turbo 10MB". The promotion offers
Arnet 6Mb WIFI + Turbo 10MB at P$110 during six months of service with the
possibility of extending the promotion to twelve months if the service was
contracted online.

The Company has launched a video streaming service 'Arnet Play', focusing on
promoting the content variety and the new offers in the catalogue, reaching
approximately 49 thousand clients.

Consolidated Operating Costs

The Cost of Services Provided, General & Administrative Expenses and Selling
Expenses, excluding Gains on disposal of PP&E, totaled P$18,238 million in
FY12, an increase of P$3,545 million, or +24% vs. FY11. The increase is a
consequence of higher commercial costs due to a higher volume of revenues, the
inflationary effects in the general cost structure, and greater expenses
related to the intense competition.

The cost breakdown is as follows:

- Employee benefit expenses and severance payments totaled P$3,269 million
(+25% vs. FY11), mainly affected by increases in salaries and an increase in
the number of employees in the mobile business. Total headcount at the end of
the period totaled 16,808 employees (+3% vs. FY11) (including temporary
employees), where 440 employees were incorporated in the mobile business and
22 employees in the fixed services, when compared to headcounts at the end of
2011.

- Taxes and fees with regulatory authorities reached P$2,018 million (+27% vs.
FY11), impacted mainly by a higher volume of revenues, higher taxes with the
regulatory authority, higher bank debit and credit taxes and an increase in
turnover taxes in municipal jurisdictions.

- Interconnection costs and other telecommunication charges (includes TLRD,
Roaming, Interconnection, international settlement charges and lease of
circuits) amounted to P$1,707 million, +P$210 million vs. FY11. This increase
resulted from higher roaming charges partially compensated by savings arising
from stimulating on-net traffic among mobile clients and consequently the
decrease in third parties network usage costs.

- Commissions (Commissions paid to Agents, prepaid card commissions and
others) totaled P$1,949 million (+29% vs. FY11), mainly due to the increase in
commissions paid to commercial agents associated with higher revenues from the
sale of more sophisticated handsets with the aim of gaining fidelity from
clients. Agent commissions capitalized as SAC amounted to P$314 million (+27%
vs. FY11)

- Advertising amounted to P$660 million (+10% vs. FY11), oriented towards
supporting the commercial activity in mobile and Internet services and to
strengthening the brands of the Telecom Group. A significant portion of this
increase was also applied to the Mobile Number Portability campaign, lunched
during the first semester of the year.

- Cost of handsets sold totaled P$2,043 million (+25% vs. FY11), due to an
increase in high-end handsets sales and a higher number of handset upgrades
(+28% vs. FY11), performed to stimulate VAS usage. These effects resulted in
the increase of the average cost of handsets. Deferred costs from SAC amounted
to P$463 million (-1% vs. FY11).

- Fees for services, maintenance and materials amounted to $2,109 million
(+23% vs. FY11), principally due to increased efforts to improve customer care
services through call centers and the increase of labor related costs to these
services.

- Depreciations and Amortizations reached P$2,612 million (+21% vs. FY11).
PP&E depreciation amounted to P$1,792 million (+17% vs. FY11); SAC and
services connection costs amortization totaled P$797 million (+32% vs. FY11);
and other intangible assets amortization reached P$23 million.

- Others Costs totaled P$1,871 million (+37% vs. FY11). This increase was
mainly due to general increases in public services such as energy, water and
others reaching P$294 million in FY12 (+91% vs. FY11), affected by the
elimination of government subsidies. Bad debt expenses reached P$275 million
representing 1,5% of consolidated costs, while provisions expenses decreased
by -32% vs. FY11. Additionally, there is a one-time charge (P$90 million) that
impacted in 2012 and relates to incurred and provisioned costs to implement an
efficiency gain program in the corporate structure of the Company.

Consolidated Financial Results

Financial Results resulted in a gain of P$229 million, an increase of P$149
million vs. FY11. This was mainly due to a gain in net financial interest of
P$272 million in FY12 (+P$180 million vs. FY11) derived from a healthy
financial position and to losses for FX results of P$46 million in FY12 (vs.
losses of P$15 million in FY11) as a result of a higher depreciation of the
peso.

Consolidated Net Financial Position

As of December 31, 2012, Net Financial Position (Cash, Cash Equivalents and
financial Investments minus Loans) totaled P$3,648 million in cash, an
improvement of P$964 million vs. Net Financial Position as of December 2011,
after the cash dividend payment of P$807 million done by Telecom Argentina in
May 2012.

Capital Expenditures

Throughout FY12, the Company invested P$3,257 million. This amount was
allocated to Fixed Services (P$1,429 million) and Mobile services (P$1,828
million). In relative terms, capex reached 15% of consolidated revenues.

Main capital expenditures programs in the fixed business were the enlargement
and upgrade of Broadband services to improve capacity and increase speed
offered to clients through the shortening of the local loop together with the
development of infrastructure to support the growth of mobile internet. In the
mobile business, Telecom continued its 3G network deployment with the
intention of increasing access capacity and sustaining the growth of mobile
Internet.

Moreover Telecom continued investing in the transport network to support the
fixed and mobile data traffic growth.

Other Relevant Matters

The Board of Directors, in the meeting held today, has appointed Mr. Stefano
De Angelis as Chief Executive Officer, in replacement of Mr. Franco Bertone
who will take on other professional responsibilities in the Telecom Italia
Group.

Telecom is the parent company of a leading telecommunications group in
Argentina, where it offers, either itself or through its controlled
subsidiaries local and long distance fixed-line telephony, cellular, data
transmission and Internet services, among other services. Additionally,
through a controlled subsidiary, the Telecom Group offers cellular services in
Paraguay. The Company commenced operations on November 8, 1990, upon the
Argentine government's transfer of the telecommunications system in the
northern region of Argentina.

Nortel Inversora S.A. ("Nortel"), which acquired the majority of the Company
from the Argentine government, holds 54.74% of Telecom's common stock. Nortel
is a holding company whose common stock (approximately 78% of capital stock)
is owned by Sofora Telecomunicaciones S.A. Additionally, Nortel capital stock
is comprised of preferred shares that are held by minority shareholders.

As of December 31, 2012, Telecom continued to have 984,380,978 shares
outstanding.

For more information, please contact the Investor Relations Department:

                 Solange Barthe Horacio Nicolas   Gustavo Tewel Ruth Fuhrmann
Pedro Insussarry Dennin         del Campo
                                                   (5411) 4968   (5411) 4968
(5411) 4968 3743 (5411) 4968    (5411) 4968 6236   3718          4448
                 3752

Voice Mail: (5411) 4968 3628
Fax: (5411) 4968 3616
E-mail: relinver@ta.telecom.com.ar

For information about Telecom Group services, visit:

www.telecom.com.ar
www.personal.com.ar
www.personal.com.py
www.arnet.com.ar

Disclaimer

This document may contain statements that could constitute forward-looking
statements, including, but not limited to, the Company's expectations for its
future performance, revenues, income, earnings per share, capital
expenditures, dividends, liquidity and capital structure; the effects of its
debt restructuring process; the impact of emergency laws enacted by the
Argentine Government; and the impact of rate changes and competition on the
Company's future financial performance. Forward-looking statements may be
identified by words such as "believes," "expects," "anticipates," "projects,"
"intends," "should," "seeks," "estimates," "future" or other similar
expressions. Forward-looking statements involve risks and uncertainties that
could significantly affect the Company's expected results. The risks and
uncertainties include, but are not limited to, the impact of emergency laws
enacted by the Argentine government that have resulted in the repeal of
Argentina's Convertibility law, devaluation of the peso, various changes in
restrictions on the ability to exchange pesos into foreign currencies, and
currency transfer policy generally, the "pesification" of tariffs charged for
public services, the elimination of indexes to adjust rates charged for public
services and the Executive branch announcement to renegotiate the terms of the
concessions granted to public service providers, including Telecom. Due to
extensive changes in laws and economic and business conditions in Argentina,
it is difficult to predict the impact of these changes on the Company's
financial condition. Other factors may include, but are not limited to, the
evolution of the economy in Argentina, growing inflationary pressure and
evolution in consumer spending and the outcome of certain legal proceedings.
Readers are cautioned not to place undue reliance on forward-looking
statements, which speak only as the date of this document. The Company
undertakes no obligation to release publicly the results of any revisions to
forward-looking statements which may be made to reflect events and
circumstances after the date of this press release, including, without
limitation, changes in the Company's business or to reflect the occurrence of
unanticipated events. Readers are encouraged to consult the Company's Annual
Report on Form 20-F, as well as periodic filings made on Form 6-K, which are
filed with or furnished to the United States Securities and Exchange
Commission for further information concerning risks and uncertainties faced by
Telecom.

SOURCE Telecom Argentina S.A.

Website: http://www.telecom.com.ar