Slide 1: Results 1Q21
R E S U LT S 1Q21 Telefônica Brasil S.A. Investor Relations May 12th, 2021 1
Slide 2: Disclaimer
DISCLAIMER This presentation may contain forward-looking statements concerning future prospects and objectives regarding growth of the subscriber base, a breakdown of the various services to be offered and their respective results Our actual results may differ materially from those contained in such
Slide 3: Solid underlying operating trends driving acceleration of core revenues
SOLID UNDERLYING OPERATING TRENDS DRIVING THE ACCELERATION OF CORE REVENUES, RESULTING IN TOTAL REVENUE GROWTH IN 1Q21 96 million total accesses 46mn 3.7mn 88.1% 1.0bn R$ Mobile Postpaid FTTH¹ Core Revenues/ FTTH¹ Accesses Homes Connected Total Revenues² Revenues 1Q21 +1.1 million postpaid net +41%
Slide 4: Vivo is transforming its revenue profile as core businesses represent almost 90% of revenues
VIVO IS TRANSFORMING ITS REVENUE PROFILE AS CORE BUSINESSES REPRESENT ALMOST 90% OF REVENUES Core Businesses Total Revenues¹ Revenues from Core Businesses R$ million, % R$ million Mobile Handsets 10,825 10,849 +0.2% 9,131 9,563 +4.7% FTTx IPTV 2,060 2,416 +17.2% Digital Data Services and ICT 84.4% 8
Slide 5: Sustaining mobile revenue growth driven by prepaid activity and handset sales
SUSTAINING MOBILE REVENUE GROWTH DRIVEN BY STRONG PREPAID COMMERCIAL ACTIVITY AND HANDSET SALES Postpaid vivo easy Mobile Revenues R$ million 7,070 7,147 +1.1% 581 644 ARPU improvement through Vivo Selfie co-branded plans, offering Co-creation of Vivo Easy, a 100% digital content and increasing digi
Slide 6: Best-in-class connectivity and customer care driving churn to record low
BEST-IN-CLASS CONNECTIVITY AND CUSTOMER CARE DRIVING CHURN TO RECORD LOW LEVELS IN 1Q21, COMBINED WITH SOLID POSTPAID NET ADDITIONS Mobile Market-share¹ Postpaid Churn Postpaid Net Additions ex-M2M thousands, ex-M2M 33.0% 33.1% 1.10% 0.62% 0.56% 32.2% 666 638 426 Average Convergent Family plan Mar-1
Slide 7: Robust core fixed revenue growth driven by demand for high-speed connectivity
ROBUST CORE FIXED REVENUE GROWTH DRIVEN BY INCREASING DEMAND FOR HIGH- SPEED CONNECTIVITY AND RELEVANT DIGITAL SERVICES FTTH Core Fixed Revenues¹ Revenues, R$ million R$ million +61.2% 2,416 +17.2% vs. 9.1% YoY in Consistent FTTH revenue 2,060 4Q20 growth driven by ARPU 1,010 increase, OTT² bundles
Slide 8: Increasing volume of FTTH net additions with superior ARPU
INCREASING VOLUME OF FTTH NET ADDITIONS WITH SUPERIOR ARPU SUPPORTED BY ACCELERATED FIBER DEPLOYMENT FTTH Net Additions FTTH Homes Passed thousand million +4.6 2.1x +2.7 record Fiber deployment 1.5x enhanced by organic expansion and 16,309 implementation of 8,980 11,681 alternative, Capex light, mod
Slide 9: FiBrasil: neutral fiber network operational by 2H21
FIBRASIL: NEUTRAL FIBER NETWORK WILL BE OPERATIONAL BY 2H21, ACCELERATING FIBER DEPLOYMENT AND REDUCING TIME-TO-MARKET Milestones 04/06/21 04/23/21 Pending 2H21 CADE European ANATEL FiBrasil fully + + approval Anti-Trust approval operational Agency approval CDPQ is a Canadian long-term institutional
Slide 10: Vivo expanding its portfolio and creating a digital ecosystem
VIVO IS EXPANDING ITS PORTFOLIO AND CREATING A DIGITAL ECOSYSTEM, TEAMING UP WITH THE TOP PLAYERS OF THESE SEGMENTS Launch of e-Health Platform Equity Stake Partnerships Agreements with top players in their segment, generating Binding agreement with value to Vivo: Teladoc, one of the largest ▪ Lever
Slide 11: Launch of Vivo Pay and expansion of Vivo Money
LAUNCH OF VIVO PAY AND EXPANSION OF VIVO MONEY GENERATE MORE BENEFITS AND ENHANCE LIFETIME VALUE Vivo’s free digital account Credit origination R$ million Cash transfers to other 2.0x Personal loan service, initially Virtual Prepaid Card banks via PIX focused on postpaid and for online shopping hybr
Slide 12: Vivo's ESG initiatives are a component of our purpose
VIVO’S ESG INITIATIVES ARE AN IMPLICIT COMPONENT OF OUR PURPOSE, “DIGITALIZE TO BRING CLOSER”, AND WILL CONTINUE TO EVOLVE IN 2021 Launch of the Campaign ‘United against hunger’ 1st Brazilian company of the in partnership with the NGO Gerando sector with ISO 26000 certificate Falcões, and support of
Slide 13: Acceleration of revenues and shift to digital hub transforming the cost base
THE ACCELERATION OF VIVO’S REVENUES AND SHIFT TOWARDS BECOMING A DIGITAL HUB IS TRANSFORMING THE COST BASE ex-Cogs: Cost of Services and Goods Sold -2.5% Total Costs¹ R$ million R$ million ▪ COGS impacted by 6,393 6,394 0.0% acceleration of B2C and B2B equipment 1,916 +19.5% sales 1,603 ▪ Cost of Se
Slide 14: Efficiency-oriented mindset fast-tracking digitalization and simplification
AN EFFICIENCY-ORIENTED MINDSET IS FAST-TRACKING THE DIGITALIZATION AND SIMPLIFICATION JOURNEY, IMPROVING CUSTOMER EXPERIENCE AND REDUCING COSTS Automation e-Commerce e-Care 917 Digital FTTH Sales Robots executing +83.6% 19.4mn Unique Users Automated Meu Vivo Processes +2.7 million YoY 91% 1Q20 1Q21
Slide 15: Investments in upgraded mobile coverage and fiber
INVESTMENTS IN UPGRADED MOBILE COVERAGE AND FIBER DRIVEN BY INCREASED DATA CONSUMPTION AND FTTH NET ADDITIONS CAPEX Preparation for 5G Capex, R$ Million Capex/Sales, % ▪ Solid competitive advantage from the start as Vivo has the country’s largest fiber footprint +18.0% 83% of Capex dedicated to 1,94
Slide 16: Elevated shareholder remuneration supported by net profit and buyback program
ELEVATED SHAREHOLDER REMUNERATION SUPPORTED BY NET PROFIT GENERATION AND ESCALATED SHARE BUYBACK PROGRAM Net Income Shareholder Remuneration R$ million R$ million R$0.7 billion declared as of April 2021 270 280 1,153 942 Dividend 150 Yield LTM: 7.9% 1Q20 1Q21 Fev-21 Mar-21 Apr-21 Payment Schedule ba
Slide 17: Free cash flow rose 3.7% YoY in 1Q21
FREE CASH FLOW ROSE 3.7% YOY IN 1Q21 DUE TO VIVO’S ROBUST OPERATING AND FINANCIAL MANAGEMENT RESULTING IN SOLID BALANCE SHEET AND IMPROVED METRICS Free Cash Flow¹ R$ million, Δ a/a 24 (296) 466 (39) (153) 2,120 2,199 1Q20 FCF After Leasing Recurring EBITDA Capex Interest and Income Taxes Working Cap
Slide 18: Investor Relations
For further information: Investor Relations w w w. t e l e f o n i c a . c o m . b r / i r i r. b r @ t e l e f o n i c a . c o m +55 11 3430.3687 18