Slide 1: Capital contribution footnotes
(1) Capital contribution made by the Company with property, plant and equipment and intangible assets, with the issue of 1,199,900 new common shares, nominative and with no par value. (2) A loss arising from operating expenses, net of income tax and social contribution. (3) Capital contribution by C
Slide 2: Capital contribution footnotes
(1) Capital contribution made by the Company with property, plant and equipment and intangible assets, with the issue of 1,199,900 new common shares, nominative and without par value (see notes 12, 13 and 14). (2) Equity accounting adjustment for losses of investee, arising from operating expenses,
Slide 3: FiBrasil sale footnotes
(1) Refers to the sale of the Company's shareholding in FiBrasil, as follows: (i) 499,999 shares to TEF Infra, to be received in four installments, the first being in cash plus the remaining three annual installments maturing in the month of July, until 2024; and (ii) 200,000 shares for the CDPQ, in
Slide 4: Capital contribution footnotes
(1) Capital contribution made by the Company with funds, with the issue of 319,900 new quotas (see note 12). (2) A loss arising from operating expenses, net of income tax and social contribution. (3) Capital contribution made by TC&CT with resources. (4) Present value of the capital increase to be p
Slide 5: Capital contribution footnotes
(1) Capital contribution made by the Company with funds, with the issue of 319,900 new quotas (see note 12). (2) Write-offs of cost of the investment held by the Company in CloudCo Brasil, appropriated against “Other Capital Reserves” (see notes 12 and 23). (3) Remeasurement of the change in equity
Slide 6: CloudCo Brasil sale footnotes
(1) Refers to the sale of the Company's shareholding in CloudCo Brasil, for 64,949 shares, received in cash on the closing date (see note 12). (2) Refers to the write-off of cost of the investment held by the Company in CloudCo Brasil (see notes 12 and 23). (3) Refers to current and deferred income
Slide 7: Segment reporting
(1) On May 25, 2021, Innoweb Ltda, a direct subsidiary of POP and an indirect subsidiary of the Company, changed its name to Recicla V Comércio e Reciclagem de Sucatas e Metais Ltda. (“Recicla V”), also changing its corporate purpose to trade and recycling scrap and metals to be developed by it. e)
Slide 8: Financial investments footnotes
(1) Refers to financial investments in senior shares of FOR-TE Fundo de Investimento em Direitos Creditórios. (2) Refer to financial investments in guarantees for lawsuits (Note 19.e). 5) TRADE ACCOUNTS RECEIVABLE
Slide 9: Trade accounts receivable
(1) Includes contractual assets. On September 30, 2021 and December 31, 2020, the net consolidated balances of the contractual assets were R$126,545 and R$168,683, respectively. Consolidated balances of non-current trade accounts receivable include:
Slide 10: Receivables maturity schedule
(1) The maturity schedule of the nominal amounts and the present value of the Vivo TECH product is of up to five years. There are no unsecured residual values resulting in benefits to the lessor nor contingent payments recognized as revenue for the periods. The following are amounts receivable, net
Slide 11: Receivables and impairment losses
(1) Includes the amounts of contractual assets. On September 30, 2021 and December 31, 2020, no customer represented more than 10% of trade accounts receivable, net. The following table shows the changes in estimated losses for impairment of accounts receivable.
Slide 12: Changes in estimated impairment losses
Company __ Consolidated Balance at 12.31.19 (1,616,698) (1,644,797) Supplement to estimated losses, net of reversal (Note 25) (1,349,588) (1,360,741) Write-off 1,024,853 1,035,599 Balance at 09.30.20 (1,941,433) (1,969,939) Supplement to estimated losses, net of reversal (385,058) 379,617) Wiite-off
Slide 13: Inventories footnotes
(1) This includes, among others, mobile phones, simcards (chip) and IT equipment in stock. (2) Additions and reversals of estimated impairment losses and inventory obsolescence are included in cost of goods sold (Note 25). 7) PREPAID EXPENSES
Slide 14: Prepaid expenses and taxes recoverable
(1) Refers to the remaining portion of the Inspection and Operation Fee amounts, which will be amortized through the end of 2021. 8) INCOME AND SOCIAL CONTRIBUTION TAXES a) Income and Social Contribution taxes recoverable
Slide 15: Deferred taxes
The non-current amounts of R$97,093 and R$96,252, recorded in the Company and Consolidated, on September 30, 2021 and December 31, 2020, respectively, refer to the taxes classified in IFRIC 23 - Uncertainties about Income Tax Treatments (Note 8.e). c) Deferred taxes Significant components of deferre
Slide 16: Deferred tax components
Prosions for lgat aber ace andrepuatry contingencies Trage acount payable and cher prosions Customer portto and ademarts Estimated losses onimpatmento accounts recoatle Esumated losses tom modems and omer PAE tems Pension lans and che post employment bene Pret shang Leanses Goode Spanish anataytee,
Slide 17: Deferred tax assets (liabilities)
Deferred tax assets (liabilities) Income and social contribution taxes on tax losses (1) Income and social contribution taxes on temporary differences (2) Provisions for legal, labor, tax civil and regulatory contingencies. Trade accounts payable and other provisions Customer portfolio and trademark
Slide 18: Consolidated deferred taxes
Consolidated. Galas Tacoma Corprahansie —Eaance on icone COTETanSTe Eau Ba 22119 stamem income 09020 stsment income wansatens) 123120 Deferred tax assets (abilities) Income an soci ontsbuten axes on taxloss08 (1) 41479936 (25200) = 14545567942 : < saszase Income an Sci ontiButen taxes on tomporaryai
Slide 19: Deferred tax footnotes
(1) Under Brazilian tax legislation these may be offset up to 30% of the annual taxable income but otherwise have no expiry date. (2) Amounts that will be realized upon payment of provision, occurrence of impairment losses for trade accounts receivable, or realization of inventories, as well as upon
Slide 20: Income tax reconciliation
Company ‘Three-month periods ended Nine-month periods ended 09.30.21 09.30.20 09.30.21 09.30.20 Income before taxes 1,632,264 1,493,025 4,468,234 4,255,480 Income and social contribution tax expenses, at the tax rate of 34% (654,970) (607,623) (1,519,200) (1,446,863) Permanent differences Equity pic
Slide 21: Uncertainties about income tax treatments
e) Uncertainties about Income Tax Treatments The Company and its subsidiaries are defending several assessments filed by the Federal Revenue of Brazil (“RFB”) for allegedly incorrect deductions of expenses, mainly related to the amortization of goodwill, at various administrative and judicial levels
Slide 22: Other taxes recoverable
(1) Includes ICMS credits from the acquisition of property and equipment, available to offset in 48 months; requests for refund of ICMS paid on invoices that were subsequently cancelled; for the rendering of services; tax substitution; and tax rate difference; among others. Non-current consolidated
Slide 23: Tax judicial deposits
The table below presents the classified balances on September 30, 2021 and December 31, 2020 of the tax judicial deposits (classified by tax).
Slide 24: Tax judicial deposits by tax
Consolidated Tax 09.30.21 12.31.20 Corporate Income Tax (IRPJ) and Social Contribution Tax (CSL) 53,666 92,849 Universal Telecommunication Services Fund (FUST) 531,244 525,563, State Value-Added Tax (ICMS) 352,314 331,086, Social Contribution Tax for Intervention in the Economic Order (CIDE) 292,773
Slide 25: Other assets and investments
(1) On September 30, 2021 and December 31, 2020, includes R$100,104 and R$158,959, respectively, for the distribution of the PBS-A surplus. (2) On September 30, 2021 and December 31, 2020, includes R$59,480 (R$43,878 in Related-party receivable and R$15,602 in Other receivables) and R$12,122, respec
Slide 26: Investees balance sheet summary
Equity interest ‘Summary of balance sheets: Current assets Non-current assets Total assets Current liabilities Non-curtent liabilities Equity Total liabilities and equity 09.30.21 ‘Subsidianes Joint ventures Taira Networks PoP Consolidated ___TGLog _Vivo Mone) Cloud. Consolidated FiBrasil ACT. ANK A
Slide 27: Investees balance sheet summary 2020
12.31.20 ‘Subsidiaries Joint ventures Tera Networks POP Consolidated ‘TGLog Vivo Money Consolidated ACT AK Equity interest 100.0% 99.99% 10.00% 99.99% 50.00% 50.00% ‘Summary of balance sheets: Current assets 322,248 29,453 4,067 68,753, 33 31,263 Non-current assets 256,440 9,196 : 55,500 : 10,426 To
Slide 28: Investees income statements, nine months 2021
Nine-month periods ended 093021 Subaiies “onions Tere Networks POP Summary ofIncome Statements: Consolidated __TGLag Vio Money __Cloud Consobdated __—FBtasil __FiBrasl act AK ___Abanga Net operating income 253.356 ——=58.653, nr eo) 25510 78 41685 Operating costs andincome (expenses) (187.085) (67.50
Slide 29: Investees income statements, nine months 2020
Nine-month periods ended 09.30.20 Subsidiaries Terra Networks CyberCo POP Summary of income Statements: Consolidated TGLog _Vivo Money Brasil Consolidated Net operating income 459,638, 41,352 - - 15.036 Operating costs and income (expenses) (243,435) (40,512) a (134) 8.119) Financial income (expense
Slide 30: Property, plant and equipment
The equity accounting pickup adjustment of the parent company and consolidated includes FiBrasil Operation (note 1.c): (i) from interest in earnings; (ii) the fair value of the remeasurement of equity interest; and (iii) the update of the share premium amount. 13) PROPERTY, PLANT AND EQUIPMENT a) Br
Slide 31: Property and equipment balances and changes
Balances and changes: Balance on 12.31.19, ‘Adsttons write-offs, et (1) Nettransters ‘Subleting 2) Depreciation (Note 25) Balance on 09:30.20 Adsitons Winte-ofs, net (1) Nettransters ‘Subleting (2) Capital contribution to CyberCo Brasil Depreciation Balance on 12.31.20 Adsitons Wirte-offs, nett) Net
Slide 32: Property and equipment footnotes
(1) Infrastructure, includes R$192,249 and R$288,603 in 2021 and 2020, respectively, for cancellation of lease agreements (2) Refers to the lease for structures (towers and rooftops), areas in Curitiba data center and real estate and attachment points. (3) Refers to the residual balance of property,
Slide 33: Pledged assets and concession balance
c) Property and equipment items pledged in guarantee On September 30, 2021, the Company had property and equipment pledged in guarantee for lawsuits, of R$78,224 (R$85,172 on December 31, 2020). d) Concession Balance The fixed switched telephone service concession model adopted in 1998 upon privatiz
Slide 34: Intangible assets balances and changes
Balances and changes: ‘Balance on 12.31.19 -asitions Wite-of, net Netwansters “Amortzation (Note 25) ‘Balance on 09.3020 -assions (1) Whos, net (2) Nettaneters ‘Capital contibution to CyberCo Bras Amortzaton ‘Balance on 12.34.20 ‘assions (1) Wte-of, net Netwansters ‘Transfers of goods destinedtor sa
Slide 35: Intangible assets footnotes
(1) Additions to licenses, in 2020 and 2021, refers to the extension of the authorization for the right to use radio frequencies use of SMP in the Federal District and in the State of Rio de Janeiro, granted by ANATEL (Note 1.b). (2) Proportional write-offs of goodwill refer to the disposal of the i
Slide 36: Social charges and benefits
Social charges and benefits Profit sharing Share-based payment plans (Note 29) Salaries and wages Total Current Non-current Company Consolidated 09.30.21 12.31.20 09.30.21 12.31.20 573,697 331,952 604,515 350,138 233,828 278,283 238,954 285,079 96,578 85,559 97,250 86,296 130,765 45,235 136,371 46,4
Slide 37: Taxes, charges and contributions payable
17) TAXES, CHARGES AND CONTRIBUTIONS PAYABLE
Slide 38: Dividends and interest on equity
(1) Refers to the residual balances of 2020 and 2021, which, according to decisions of the Federal Regional Court of the First Region, issued on March 18, 2020 and March 10, 2021, respectively, for payments suspended. 18) DIVIDENDS AND INTEREST ON EQUITY (IOE) a) Dividends receivable On September 30
Slide 39: Dividends and interest on equity payable
For the cash flow statement, interest on equity and dividends received from the subsidiary are classified in “Investing Activities”. b) Dividends and interest on equity payable b.1) Breakdown:
Slide 40: Dividends payable breakdown
Company/Consolidated 09.30.21 12.31.20 Telefénica Latinoamérica Holding 837.113, Telefénica 1,021,474 SP Telecomunicacées Participagdes 660,012 Telefénica Chile 1,849 Non-controlling interest 1,345,550 Total 3,865,998
Slide 41: Provisions and contingencies
The dividends declared on December 11, 2020 and April 15, 2021, of R$2,787,518, will be paid on October 5, 2021 (note 23.d). For the cash flow statement presentation purposes, interest on equity and dividends paid to shareholders are classified in “Financing Activities”. 19) PROVISIONS AND CONTINGEN
Slide 42: Changes in provisions for contingencies
Balance on 12.31.19 Additions (reversal), net (Note 26) Other actions (ceversl) (1) Wite-ofs due to payment Interest accruals Balance on 09.30.20 Additions (reversal), net Other additions (reversal) (1) Wite-of6 due to payment Interest acerals Balance on 12.31.20 Additions (reversal), net (Note 26)
Slide 43: Provisions footnotes and labor provision
(1) Provision for decommissioning refers to the reversal resulting from the review of costs for dismantling technical sites. The effects of this reversal were recognized against property, plant and equipment. (2) Contingent liabilities (PPA): mainly due to the reversal of TFF and PIS and COFINS on u
Slide 44: Tax provisions
Changes in provisions and contingencies reflect reassessments of the probability of loss in the period, due to the procedural progress and factual and evidential matters. b.1) Tax provisions Management, under advice of legal counsel, believes that the following losses are probable for the federal, s
Slide 45: Loans, financing, debentures and leases
On September 30, 2021, in addition to the guarantees presented above, the Company and its subsidiaries held short-term investment deposited in courts (except for loan-related investments) in the consolidated amount of R$40,341 (R$46,280 on December 31, 2020). 20) LOANS, FINANCING, DEBENTURES AND LEA
Slide 46: Loans and financing, supplier financing
a.1) Loans and financing – Financial Institutions Some financing agreements with the financial institutions have lower interest rates than those prevailing in the market. These operations fall within the scope of IAS 20 and therefore up to December 31, 2017 were discounted to present value and defer
Slide 47: Lease obligations
(1) On September 30, 2021 and December 31, 2020, the present value of balances payable, included R$79,590 and R$1,470,508, respectively, referring to lease agreements with Telefónica Group companies (Note 28). The reduction in amounts with companies of the Telefónica Group results from the sale of t
Slide 48: Lease rates and repayment schedule
The weighted annual interest rate on lease contracts on September 30, 2021 is 8.128%, with an average maturity of 5.62 years. The present value of lease agreements is measured by discounting future fixed payment flows, which do not include projected inflation, at market interest rates, estimated usi
Slide 49: Covenants and changes in balances
c) Covenants Loans and financing with financial institutions and debentures carry specific covenants involving a penalty in the event of breach of contract. A breach of contract as provided for in the agreements with the institutions listed above in item a), is characterized as non-compliance with c
Slide 50: Additions and payments
e) Additions and payments The following is a summary of additions and payments made during the quarter ended September 30, 2021.
Slide 51: Loans additions and payments table
Loans- Financial institutions PSI Debéntures Sth issue Financing - Suppliers Leases Total Consolidated 09.30.21 Write-offs (payments) Additions Principal charges Total : (62) (2) (64) - (62) (2) (64) - (1,028,312) (38,669) (1,066,981) - (1,000,000) (36,972) (1,036,972) 201,919 (211,162) (7,580) (218
Slide 52: Deferred revenue footnotes
(1) Refers to the balance of contractual liabilities of customers, deferred when they relate to performance obligations satisfied over time. (2) Includes the net balances of the residual values from sale of non-strategic towers and rooftops, transferred to income as the conditions for recognition ar
Slide 53: Equity: capital
(1) Includes the cost of renewing STFC and SMP licenses and SMP licenses and the extension of the authorization to use radio frequencies for the exploitation of SMP in the State of Rio de Janeiro and Federal District (Notes 1.b and 14). (2) This refers to payroll withholdings and taxes withheld from
Slide 54: Capital and revenue reserves
b) Capital reserves The information on the capital reserves, is the same as in Note 23) Equity, item b) , disclosed in the financial statements for the year ended December 31, 2020. With respect to treasury shares, during the nine-month period ended September 30, 2021, 8,858,300 common shares were a
Slide 55: Interest on equity and dividends for 2020
d.2) Interest on Equity and Dividends for 2020 At the AGM held on April 15, 2021, the financial statements and allocations of income for the year 2020 were approved by majority vote of the holders of the common shares present. The details of the allocations of the income are the same as disclosed in
Slide 56: Unclaimed dividends and interest on equity
d.3) Unclaimed dividends and interest on equity (“IOE”) Pursuant to Article 287, paragraph II, item “a” of Law No. 6404, of December 15, 1976, the dividends and interest on equity unclaimed by shareholders are subject to the statute of limitation of three years, as from the initial payment date. The
Slide 57: Share repurchase program
f) Company Share Repurchase Program On July 28, 2020, the Company's Board of Directors, in accordance with article no. 17, item XV of the Bylaws and CVM Instruction no. 567, approved a new Share Repurchase Program of the Company, which has as its objective the acquisition of common shares issued by
Slide 58: Non-controlling shareholders
h) Non-controlling shareholders On September 30, 2021, the consolidated information presented the amount of non-controlling interest due to the partial sale operation (49.99%) of the Company's investment in CloudCo Brasil (note 1.c). The amounts of this non-controlling interest on September 30, 2021
Slide 59: Net operating revenue
Gross operating revenue Senices (1) Sale of goods (2) Deductions from gross operating revenue Tax Senices Sale of goods Discounts granted and return of goods Senices Sale of goods Net operating revenue Services Sale of goods Company Three-month periods ended Nine-month periods ended 09.30.21 09.30.2
Slide 60: Revenue footnotes
(1) These include telephone services, use of interconnection network, data and SVA services, cable TV and other services. (2) These include sale of goods (handsets, SIM cards and accessories) and equipment of “Vivo Tech”. No single customer contributed more than 10% of gross operating revenues in th
Slide 61: Operating costs and expenses, nine months
Company Personnel Thi pany senices Real, insurance, condominium and connection Taxes, charges and contbtions Estimated impairment losses on accounts receable (ote 5) Depreciation and amortization Cost of goods sold Materials and other operating costs and expenses Total ‘ine-month peods ended 093028
Slide 62: Operating costs and expenses, three months
“Three-month prods ended 093024 09.3020 ‘Conorar and ‘General and Cost of sales ‘Seling administrate ost of sales ‘Selig administrative andsenices, __expenses,__exponses “otal and senices,__expenses,__ expenses Taal (224640) (652521) (47.828) (4.0989) (192642) (640076) (92440) (926,158 (2.076564) (4
Slide 63: Operating costs footnote
(1) Includes the consolidated amount of R$2,018,407 and R$1,570,789 in the nine-month periods ended September 30, 2021 and 2020, respectively, related to lease depreciation. 26) OTHER OPERATING INCOME (EXPENSES)
Slide 64: Other operating income (expenses)
Recovered expenses and fines (1) Provisions for labor, tax, civil, regulatory and contingent liabilities (Note 19) (2) Net gain (loss) on asset disposal/loss Net income from the FiBrasil operation, including goodwill wwite-off (nate 1.c) Other operating income (expenses) Total Other operating income
Slide 65: Other operating income footnotes
(1) For the nine-month periods ended September 30, 2021 and 2020, includes tax credits, of R$1,607,008 and R$435,698, respectively, arising from decisions on lawsuits, in favor of the Company, for PIS and COFINS tax credits. (2) The amounts for the nine-month periods ended September 30, 2021, includ
Slide 66: Financial income (expenses)
Company ‘Three-month periods ended ‘Six-month periods ended 09.30.21 09.30.20 09.30.21 09.30.20 Financial Income Interest income 87,825 40,390 173,459 128,523 Interest receivable (customers, taxes and other) 31,018 21,638 76.916 73,792 Gain on derivative transactions (Note 31) 48,588 36,222 110,533
Slide 67: Financial footnotes and related parties
(1) For the nine-month periods ended September 30, 2021 and 2020, includes indexation effects of R$592,020 and R$495,938, respectively, arising from decisions on lawsuits, in favor of the Company, for PIS and COFINS tax credits. (2) Includes the consolidated amounts of R$589,591 and R$297,004 in the
Slide 68: Related party balances and transactions
Companies Patent Companies SP Telecomunicagbes Patcipagdes Teltnia Latineamenea Hong Teltinica Other Group companies Telia Intemational Wholesale Senices Brest 7.02 Germany GMBH CO. OHG Telli Venezolana TeletinicaDigtal Espo Telefnica Factoring do Brasil Telelnia ltomational Wholesale Senees I, SL T
Slide 69: Related party liabilities
Companies Parent Companies SP Telecomunicacées Partcipacées Telefnica Latinoamerica Holding Teleténica Other Group companies Media Networks Latin America SAC. Telefénica Intemational Wholesale Senices Brasil T.02 Germany GMBH CO. OHG Telefnica Venezolana Telefonica Compras Electrica Teletinica Digit
Slide 70: Share plans and management compensation
· Talent for the Future Share Plan (“TFSP”), for its Senior Managers, Managers and Experts at a global level · Perform Share Plan (“PSP”), for its Vice-Presidents and Directors at the global level · Global Employee Share Plan (“GESP”) b) Management compensation Consolidated key management compensati
Slide 71: Pension plans
The details of these plans are the same as in Note 30) Pension Plans and Other Post-Employment Benefits , as disclosed in the financial statements for the fiscal year ended December 31, 2020. The changes in consolidated balances of the surplus and deficit plans were as follows:
Slide 72: Financial instruments and risk management
31) FINANCIAL INSTRUMENTS AND RISK AND CAPITAL MANAGEMENT a) Derivative transactions The derivative financial instruments contracted by the Company are mainly used for hedging against foreign exchange risk from assets and liabilities in foreign currency and the effects of inflation on leases indexed
Slide 73: Derivative transactions footnotes
(1) Foreign currency swaps (Euro and CDI x Euro) (R$72,962)) and (US$ and CDI x US$) (R$131,645) - maturing through October 21, 2021 to hedge currency risk affecting net amounts payable (carrying amount R$73,576 in Euros and LIBOR) and receivables (carrying amount R$133,637 in US$). (2) IPCA x CDI s
Slide 74: Hedge accounting and sensitivity analysis
For the purposes of preparing its financial statements, the Company adopted the fair value hedge accounting methodology for its foreign currency swaps x CDI and IPCA x CDI for hedging or financial debt. Under this arrangement, both derivatives and hedged risk are recognized at fair value. On Septemb
Slide 75: Sensitivity analysis assumptions
The assumptions used by the Company for the sensitivity analysis on September 30, 2021 were as follows:
Slide 76: Financial assets and liabilities
Financial Assots Current Cash and cash equivalents (ote 3) Financial imvestments (Note 4) Trade accounts receivable (Note §) Devatve transactions (Note 31) Non-current Financial imvestments (Note 4) Trade accounts recat (Note §) Detnatve transactions (Note 31) Total financial assets Financial Libili
Slide 77: Capital management
c) Capital management The purpose of the Company's capital management is to ensure maintenance of a high credit rating and an optimal capital ratio to support the Company's business and maximize shareholder value. The Company manages its capital structure by adjusting and adapting to current economi
Slide 78: Additional information on cash flows
33) ADDITIONAL INFORMATION ON CASH FLOWS a) Reconciliation of cash flow financing activities The following is a reconciliation of the consolidated cash flow financing activities in the nine-month periods ended September 30, 2021 and 2020.
Slide 79: Cash flow financing reconciliation
Consolidated ‘Cash flows Cash flows from financing from operating Financing activities not involving cash and cash activities activities equivalents Financial Taterim and charges and Additions of unclaimed foreign leases and dividends and Bolance on ——Write-offs_——Wiriteoffs exchange supplier intere
Slide 80: Non-cash financing transactions
b) Financing transactions that do not involve cash The main transactions that do not involve cash of the Company refer to the acquisition of assets through leases and income from financing with suppliers, as follows: