Movements in PP&E (without allowance for obsolescence
and impairment of materials and impairment allowance of PP&E) are as follows:
Movements in the valuation allowance for obsolescence
and impairment of materials are as follows:
Movements in Intangible assets (without considering the impairment allowance)
are as follows:
TELECOM
ARGENTINA S.A.
NOTE 11 –
FINANCIAL DEBT
|
September
30,
|
December
31,
|
Current
|
2021
|
2020
|
Bank
overdrafts – principal
|
13,733
|
5,414
|
Bank
and other financial entities loans – principal
|
32,726
|
10,434
|
Notes
– principal
|
1,800
|
18,885
|
NDF
|
185
|
707
|
Loans
for purchase of equipment
|
3,436
|
3,364
|
Accrued
interest and related expenses
|
14,816
|
18,174
|
|
66,696
|
56,978
|
Non-current
|
|
|
Notes
– principal
|
91,395
|
77,427
|
Bank
and other financial entities loans – principal
|
62,172
|
100,589
|
NDF
|
-
|
14
|
Loans
for purchase of equipment
|
4,318
|
5,697
|
Accrued
interest and related expenses
|
24,126
|
33,486
|
|
182,011
|
217,213
|
Total
financial debt
|
248,707
|
274,191
|
Movements in Financial debt are as follows:
|
Balances at
the
beginning of
the year
|
Cash
Flows
|
Accrued
interests
|
Exchange
differences,
currency
translation
adjustments
and others
|
Balances
as of
September
30, 2021
|
Balances
as of
September
30, 2020
|
Bank overdrafts
|
5,414
|
10,803
|
-
|
(2,484)
|
13,733
|
5,875
|
Bank and other financial entities loans – principal
|
111,023
|
(5,946)
|
-
|
(10,179)
|
94,898
|
109,241
|
Notes – principal
|
96,312
|
8,922
|
-
|
(12,039)
|
93,195
|
83,876
|
NDF
|
721
|
(1,546)
|
-
|
1,010
|
185
|
1,123
|
Loans for purchase of equipment
|
9,061
|
(1,115)
|
-
|
(192)
|
7,754
|
9,416
|
Accrued interests and related expenses
|
51,660
|
(18,757)
|
10,605
|
(4,566)
|
38,942
|
52,548
|
Total as of September 30, 2021
|
274,191
|
(7,639)
|
10,605
|
(*) (28,450)
|
248,707
|
|
|
|
|
|
|
|
|
Total as of September 30, 2020
|
283,405
|
(50,779)
|
15,552
|
13,901
|
|
262,079
|
(*) Includes $4,224 of loans that do not represent cash movement.
Most of the loans subscribed by the Company contain
standard compliance ratios for this kind of agreements, As of September 30, 2021, Telecom has complied with them.
Recent developments of Financial debt as of the
date of these unaudited consolidated financial statements are detailed below:
Telecom Argentina
Global Programs for the issuance of Notes
On December 28, 2017, Telecom Argentina held an
Ordinary Shareholders’ Meeting that approved a Notes Global Program for a maximum outstanding amount of US$3,000 million or its
equivalent in other currencies.
On January 23, 2020, the Company informed CNV about
the renewal of the period of placement of Notes. Operations carried out during the period ended September 30, 2021 within the mentioned
Program are described below:
|
·
|
Series 3 in Argentine Pesos
|
On January 31, 2020, the Company issued Series
3 Notes for a nominal value of $3,197 maturing on January 31, 2021.
During 2020, the Company repurchased approximately
$86 (principal nominal value) and on January 2021 repurchased approximately $150 (principal nominal value) at the market value of each
repurchase date, which did not significantly differ from their accounting valuation on that date.
On maturity date, the Company cancelled the remaining
balance of Series “3” Notes for a total amount of $3,249 ($2,961 of principal and $288 of interest).
TELECOM ARGENTINA S.A.
|
·
|
Series 4 in Argentine Pesos
|
On January 31, 2020, the Company issued Series
4 Notes for a nominal value of $1,200, maturing on July 31, 2021.
On maturity date, the Company cancelled the remaining
balance of Series “4” Notes for a total amount of $1,322 ($1,200 of principal and $122 of interest).
The Company announced,
from January 14, 2021, the subscription of notes for a total nominal value determined in UVA equivalent for up to $1,500, that could be
increased to $12,000, The amount of the Notes finally issued and its main characteristics are detailed below:
Issuance date: January 20, 2021.
Amount involved: 133,628,950 UVA (equivalent
to $8,708,598,672 Argentine pesos as of the date of issuance).
Maturity Date: January 20, 2025.
Amortization: Principal will be paid in
one installment at maturity date.
Interest rate and Payment Date: It bears
interests on a quarterly basis from its issuance date until its maturity date at an annual fixed rate of 4.00%. Interests are paid on
a quarterly basis, and the last interest payment date will be on the maturity date.
The Company received a
disbursement for a total amount of $8,664, since $45 corresponding to debt issuance expenses were deducted from the initial disbursement
(amount corresponding to the transaction date).
As of September 30, 2021, an amount of $11,913
remained unpaid.
The Company announced,
from June 1, 2021, the subscription of notes for a total nominal value determined in US dollars equivalent for up to US$15 million, that
could be increased to US$120 million, payable in Argentine pesos to the applicable exchange rate. The amount of the Notes finally issued
and its main characteristics are detailed below:
Issuance date: June 7, 2021.
Amount involved: US$91.8 million payable
in Argentine pesos to the applicable exchange rate (equivalent to $8,699 Argentine pesos as of the date of issuance).
Maturity Date: June 7, 2024.
Amortization: Principal will be paid in
one installment at maturity date.
Interest rate and Payment Date: It bears
interests on a quarterly basis from its issuance date until its maturity date at an annual fixed rate of 2.75%. Interests are paid on
a quarterly basis, and the last interest payment date will be on the maturity date.
The Company received a
disbursement for a total amount of $8,655, since $44 corresponding to debt issuance expenses were deducted from the initial disbursement
(amount corresponding to the transaction date).
The Company used US$91 million of the proceeds
of Series 9 Notes for the total cancellation of Series “A” Notes maturing in June 2021 (see below “Cancellation of Series
“A” Notes).
As of September 30, 2021, an amount of $9,038 remained
unpaid.
|
·
|
Cancellation of Series “A”
Notes
|
On June 15, 2021, the Company cancelled the outstanding
Series “A” Notes for a total amount of US$106.6 million (US$103.2 million of principal and US$3.4 million of interest).
Bank and other financing entities loans
China Development Bank Shenzhen Branch
(“CDB”) Loan
On December 14, 2020, the Company agreed with CDB
a compromised line of credit of up to RMB 700 million (equivalent to approximately US$100 million), that can be increased to RMB 1,400
million, structured in several tranches- The increase in the amount will be subject to the granting of an insurance by the China Export
& Credit Insurance Corporation.
TELECOM ARGENTINA S.A.
The proceeds from the loan will be used by the
Company to finance its investment plan related to the acquisition of telecommunications equipment.
As of September 30 2021, the Company had subscribed
the second, the third, the fourth, the fifth, the sixth and the seventh tranches for a total of RMB233 million (equivalent to approximately
$3,359), bearing an annual interest rate of 6.8% payable semi-annually. Principal will be cancelled in 11 semi-annual and consecutive
installments since the subscription date of each installment.
As of September 30, 2021, an amount of RMB251 million
remained unpaid (equivalent to $3,838).
On October 27, 2021, the Company received a disbursement
of RMB 43.5 million (equivalent to approximately $671).
Santander Río Bank Loan
On August 18, 2021, the Company subscribed a loan
agreement with Santander Río Bank S.A. for a total amount of $4,000. Total principal will be settled by one payment at maturity
date, which will be on August 18, 2022. The loan bears interest that will be paid in a monthly basis from its issuance date until its
maturity date at a fixed rate of 40.50%.
As of September 30, 2021, an amount of $4,010 remained
unpaid.
BBVA Bank Loan
On August 10, 2021, the Company subscribed a loan
agreement with BBVA Argentina Bank S.A. for a total amount of $1,000. Total principal will be settled by one payment at maturity date,
which will be on August 5, 2022. The loan bears interest that will be paid in a monthly basis from its issuance date until its maturity
date at a fixed rate of 40.75%.
As of September 30, 2021, an amount of $1,014 remained
unpaid.
Loan Cancellation with Macro Bank
On September 16, 2021, the Company cancelled the
remaining balance of a loan agreement with Macro Bank S.A. for $4,412 million ($4,000 of capital and $412 of interest).
Loans for purchase of equipment
Cisco Systems Capital Corporation
The Company has debt agreements with Cisco Systems
Capital Corporation related to purchase equipment financing, amounting to US$82.7 million (of which US$ 23 million were received during
the period ended September 30, 2021). Such agreements have an average maturity term of fifty months with partial repayments and accrue
an average annual interest of 4%.
As of September 30, 2021, an amount of US$83 million
remained unpaid, equivalent to $8,203.
Finnvera
On May 14, 2021, the Company submitted a proposal
for an export credit line for a total amount of up to US$30 million to the following entities: (i) JPMorgan Chase Bank, N.A., London Branch,
as initial lender, lead coordinator and guarantee of residual risk, (ii) JPMorgan Chase Bank, N.A., London Branch, as a financing agent,
and (iii) JPMorgan Chase Bank, N.A, Buenos Aires branch, as a local custody agent, which was accepted on the same date.
The credit line is guaranteed by Finnvera plc,
the official export credit agency of Finland, which granted a bond in favor of the lenders subject to certain terms and conditions.
The proceeds from the loans under this credit line
will be used to finance up to 85% of the value of certain imported goods and services, the value of certain national goods and services
and the total payment of the Finnvera premium equivalent to 14.41% of the total amount committed by the lenders under the credit line.
On July 27, 2021, the Company received a disbursement
for a total amount of US$5.1 million (US$4.4 million were received, because US$0.7 million corresponding to the premium were deducted
from the initial disbursement).
TELECOM ARGENTINA S.A.
As of September 30, 2021, an amount of US$69 million
remained unpaid, equivalent to $6,776.
Global Programs for the issuance of Notes
On January 4, 2019, Núcleo requested the
National Securities Commission and the Stock and Products Exchange of Asunción to register the Global Issuance Program that foresees
the issuance of Notes for an amount of up to 500,000,000,000 of Guaraníes (approximately $3,200 as of such date) under the conditions
that are defined by the Board of Directors in each series. On February 5, 2019, the National Securities Commission of Paraguay authorized
the Program, under Resolution N° 11E/19.
Under such Program, Núcleo
issued the following Series of Notes:
Series IV
Issuance
date: March 10, 2021.
Amount
involved: 130,000,000,000 of Guaraníes (approximately $1,771 as of the date of issuance).
Maturity
Date: 84 months from its issuance date.
Amortization: Principal
will be paid in one installment at maturity date (February 2, 2028).
Interest rate: It
bears interest from its issuance date until its maturity date at a fixed annual rate of 7.10%.
Interest Payment Date: Interest
will be paid semi-annually in arrears since the issuance date.
Núcleo received
a disbursement for a total amount of 129,057 million of Guaraníes (equivalent to $1,758), since 943 million of Guaraníes
(equivalent to $13) corresponding to debt issuance expenses were deducted from the initial disbursement (amount corresponding to the transaction
date).
As of September 30, 2021, an amount of 130,598
million of Guaraníes remained unpaid (equivalent to $1,860).
Series V
Issuance
date: March 10, 2021.
Amount
involved: 120,000,000,000 of Guaraníes (approximately $1,635 as of the date of issuance).
Maturity
Date: 120 months from its issuance date.
Amortization: Principal
will be paid in one installment at maturity date (January 17, 2031).
Interest rate: It
bears interest from its issuance date until its maturity date at a fixed annual rate of 8.00%.
Interest Payment Date: Interest
will be paid semi-annually in arrears since the issuance date.
Núcleo received
a disbursement for a total amount of 119,122 million of Guaraníes (equivalent to $1,623), since 878 million of Guaraníes
(equivalent to $12) corresponding to debt issuance expenses were deducted from the initial disbursement (amount corresponding to the transaction
date).
As of September 30, 2021, an amount of 120,621
million of Guaraníes remained unpaid (equivalent to $1,718).
The proceeds of the aforementioned series IV and
V Notes were used for the cancellation of bank loans and financing of working capital.
Fair Value of Financial Debt
As of September 30, 2021, fair
value of financial debt is as follows:
|
Carrying
Value
|
Fair
Value
|
|
|
|
Notes
|
120,380
|
115,668
|
Other
financial debts
|
128,327
|
120,876
|
|
248,707
|
236,544
|
TELECOM ARGENTINA S.A.
NOTE 12 –
SALARIES AND SOCIAL SECURITY PAYABLES
|
September
30,
|
December
31,
|
Current
|
2021
|
2020
|
Salaries,
annual complementary salaries, vacation, bonuses and their social security payables
|
15,401
|
18,673
|
Termination
benefits
|
1,167
|
961
|
|
16,568
|
19,634
|
Non-current
|
|
|
Termination
benefits
|
1,399
|
1,151
|
|
1,399
|
1,151
|
Total
salaries and social security payables
|
17,967
|
20,785
|
NOTE 13 –
DEFERRED INCOME TAX ASSETS/LIABILITIES
Amendments to the Income Tax
Pursuant to Law No. 27,430, as amended by Law No.
27,541, the statutory income tax rate in Argentina for fiscal years 2018, 2019 and 2020 was 30%, while for fiscal years beginning since
January 1, 2021, the statutory income tax rate would be 25%. However, on June 16, 2021, Law No. 27,630 was published in the Official Gazette,
and replaced the 25% statutory income tax rate by an increasing rate scale related to the taxable income of each taxpayer: 25% for annual
taxable income of up to $5 million, 30% for the exceeding annual taxable income between $5 million and $50 million and 35% for annual
taxable income exceeding $50 million. The annual taxable income scale will be adjusted annually starting in fiscal year 2022 according
to the CPI of October of the prior year to the adjustment, with respect to the same month of the previous year. The Company has recognized
the increase in the statutory income tax rate effects in the “Income tax expense” item of the consolidated income statement
as of September 30, 2021.
In addition, Law No. 27,430 established a withholding
tax regime on distributed dividends at a rate of 7% for profits generated during fiscal years beginning on or after January 1, 2018 up
to and including fiscal year ending on December 31, 2020, and at a rate of 13% for profits generated during fiscal years beginning on
or after January 1, 2021. Law No. 27, 630 also amended the last mentioned withholding tax rate, replacing it by 7% for fiscal years beginning
on or after January 1, 2021. Withholding tax regime applies only to shareholders who are Argentine resident individuals and to non-resident
shareholders.
Income tax - Actions for recourse filed with
the Tax Authority
Telecom filed during 2015 to 2020 actions for recourse
with the AFIP to claim the full tax overpaid for fiscal years 2009, 2010, 2011, 2012, 2013, 2014 and 2015 for a total amount of approximately
$1,261 plus interest, under the argument that the lack of application of the income tax inflation adjustment is confiscatory.
On July 28, 2021 Telecom was notified of the resolution
dated July 26, 2021 in which the AFIP rejected the action for recourse corresponding to fiscal year 2013. On August 23, 2021, Telecom
filed an action for recourse before the National Court of First Instance.
The Company's Management, with the assistance of
its tax advisors, understands that the arguments that will be presented should obtain a favorable resolution to its claim.
TELECOM ARGENTINA S.A.
Deferred Income tax assets and liabilities, net
and the actions for recourse tax receivable are presented below:
|
September 30,
|
December 31,
|
|
2021
|
2020
|
Tax carryforward
|
(172)
|
(15,705)
|
Allowance for doubtful accounts
|
(4,968)
|
(3,984)
|
Provisions
|
(2,432)
|
(2,016)
|
PP&E and Intangible assets
|
112,184
|
101,492
|
Cash dividends from foreign companies
|
1,335
|
805
|
Income tax inflation adjustment deferral effect
|
23,195
|
29,227
|
Other deferred tax liabilities (assets), net
|
(1,296)
|
(55)
|
Total deferred tax liabilities, net
|
127,846
|
109,764
|
Actions for recourse tax receivable
|
(882)
|
(1,208)
|
Total deferred tax liability, net
|
(*) 126,964
|
108,556
|
|
|
|
Net deferred tax assets
|
(530)
|
(564)
|
Net deferred tax liabilities
|
127,494
|
109,120
|
(*) Includes $84
of currency translation adjustments on foreign subsidiaries’ initial balances.
As
of September 30, 2021, the Company and some subsidiaries have cumulative tax carryforwards of approximately $634, that calculated considering
the statutory income tax rate applicable to each entity, represent a deferred tax asset of approximately $172.
The detail of the
maturities of estimated Tax carryforward is disclosed below:
Company
|
Tax carryforward
generation year
|
Tax carryforward amount
as of 09.30.2021
|
Tax carryforward
expiration year
|
Inter Radios
|
2018
|
3
|
2023
|
Telemás (*)
|
2019
|
490
|
2024
|
Micro Sistemas
|
2020
|
2
|
2025
|
Micro Sistemas
|
2021
|
133
|
2026
|
Cable Imagen
|
2021
|
6
|
2026
|
|
|
634
|
|
(*) This company is consolidated in
the financial statements of Adesol.
Income tax expense differed from the amounts computed
by applying the Company’s statutory income tax rate to pre-tax income as a result of the following:
|
September 30,
|
|
2021
|
2020
|
|
Profit (loss)
|
Pre-tax income
|
31,985
|
9,957
|
Non-taxable items – Earnings from associates
|
(210)
|
(567)
|
Non-taxable items – Costs valuation differences of foreign investments
|
-
|
(8,997)
|
Non-taxable items – Other
|
(350)
|
(1,015)
|
Restatement in current currency of Equity, goodwill and other
|
71,421
|
57,814
|
Subtotal
|
102,846
|
57,192
|
Weighted statutory income tax rate
|
34.49%
|
24.56%
|
Income tax expense at weighted statutory tax rate
|
(35,476)
|
(14,046)
|
Deferred tax liability restatement in current currency and other (*)
|
34,032
|
18,561
|
Income tax inflation adjustment
|
(28,669)
|
(16,214)
|
Income tax on cash dividends of foreign companies
|
(847)
|
(162)
|
Income tax expense
|
(30,960)
|
(11,861)
|
|
|
|
Current tax expense
|
(12,710)
|
(224)
|
Deferred tax expense
|
(18,250)
|
(11,637)
|
|
(30,960)
|
(11,861)
|
(*) Includes the statutory income tax rate change
effect provided by Law No. 27,630.
NOTE 14 –TAXES PAYABLES
|
September 30,
|
December 31,
|
|
2021
|
2020
|
Current
|
|
|
Income tax, net and others (*)
|
8,750
|
91
|
Other national taxes
|
3,673
|
3,954
|
Provincial taxes
|
542
|
557
|
Municipal taxes
|
505
|
519
|
|
13,470
|
5,121
|
Non- current
|
|
|
Provincial taxes
|
-
|
7
|
|
-
|
7
|
Total taxes payables
|
13,470
|
5,128
|
(*)
The breakdown of income tax payable of each entity is as follows:
|
September 30,
|
December 31,
|
|
2021
|
2020
|
Telecom
|
8,672
|
-
|
Núcleo
|
68
|
78
|
Adesol
|
8
|
10
|
AVC Continente Audiovisual
|
-
|
2
|
Pem
|
2
|
-
|
Cable Imagen
|
-
|
1
|
|
8,750
|
91
|
TELECOM ARGENTINA S.A.
NOTE 15 – LEASES LIABILITIES
|
September 30,
|
December 31,
|
|
2021
|
2020
|
Current
|
|
|
Argentina
|
5,117
|
4,202
|
Abroad
|
109
|
367
|
|
5,226
|
4,569
|
Non- current
|
|
|
Argentina
|
10,204
|
8,381
|
Abroad
|
1,958
|
1,159
|
|
12,162
|
9,540
|
Total leases liabilities
|
17,388
|
14,109
|
Movements in Leases liabilities are as follows:
|
September 30,
|
|
2021
|
2020
|
At the beginning of the fiscal year
|
14,109
|
11,617
|
Increases (*)
|
12,522
|
9,097
|
Financial results, net (**)
|
2,048
|
1,864
|
Cash Flows
|
(4,162)
|
(4,507)
|
Decreases (includes RECPAM)
|
(7,129)
|
(3,480)
|
At the end of the period
|
17,388
|
14,591
|
(*) Included in acquisitions of Rights of Use assets.
(**) Included in Other Exchange differences and Other interests, net
and other investments results.
NOTE 16 – OTHER LIABILITIES
|
September 30,
|
December 31,
|
|
2021
|
2020
|
Current
|
|
|
Deferred revenues on prepaid credit
|
1,560
|
1,523
|
Deferred revenues on connection fees and international capacity leases
|
946
|
561
|
Compensation for directors and members of the Supervisory Committee
|
19
|
20
|
Companies under Sect. 33–Law No. 19,550 and Related Parties (Note 24.c)
|
3
|
3
|
Other
|
302
|
717
|
|
2,830
|
2,824
|
Non-current
|
|
|
Pension benefits
|
553
|
578
|
Deferred revenues on connection fees and international capacity leases
|
667
|
548
|
Other
|
339
|
458
|
|
1,559
|
1,584
|
Total other liabilities
|
4,389
|
4,408
|
TELECOM ARGENTINA S.A.
NOTE 17 – PROVISIONS
Movements in Provisions are as follows:
|
|
Additions
|
|
|
|
|
Balances
as of December
31, 2020
|
Capital
(i)
|
Interest
(ii)
|
Reclassifications
|
Decreases
(iii)
|
Balances
as of
September
30, 2021
|
Current
|
|
|
|
|
|
|
Provisions
|
2,214
|
3,204
|
-
|
1,225
|
(4,736)
|
1,907
|
Total current provisions
|
2,214
|
3,204
|
-
|
1,225
|
(4,736)
|
1,907
|
Non- Current
|
|
|
|
|
|
|
Provisions
|
6,135
|
1,104
|
443
|
(1,225)
|
(1,156)
|
5,301
|
Asset retirement obligations
|
4,085
|
-
|
853
|
-
|
(1,205)
|
3,733
|
Total non-current provisions
|
10,220
|
1,104
|
1,296
|
(1,225)
|
(2,361)
|
9,034
|
Total provisions
|
12,434
|
4,308
|
1,296
|
-
|
(iv) (7,097)
|
10,941
|
|
|
Additions
|
|
|
|
|
Balances
as of December
31, 2019
|
Capital
(v)
|
Interest
(ii)
|
Reclassifications
|
Decreases
(iii)
|
Balances
as of
September
30, 2020
|
Current
|
|
|
|
|
|
|
Provisions
|
2,222
|
3,110
|
-
|
817
|
(962)
|
5,187
|
Total current provisions
|
2,222
|
3,110
|
-
|
817
|
(962)
|
5,187
|
Non- Current
|
|
|
|
|
|
|
Provisions
|
7,450
|
350
|
643
|
(817)
|
(1,403)
|
6,223
|
Asset retirement obligations
|
1,180
|
-
|
273
|
-
|
(325)
|
1,128
|
Total non-current provisions
|
8,630
|
350
|
916
|
(817)
|
(1,728)
|
7,351
|
Total provisions
|
10,852
|
3,460
|
916
|
-
|
(iv) (2,690)
|
12,538
|
(i)
$4,342 charged to Other operating expenses and ($34) charged to Other comprehensive income.
(ii)
Charged to Other financial results, net - Other interests, net and other investments results.
(iii)
Includes RECPAM.
(iv)
Includes ($4,386) and ($1,134) as of September 30, 2021 and 2020, respectively, related to provisions
payments.
(v)
$3,603 charged to Other operating expenses and ($143) charged to Other comprehensive income.
A summary of recent developments as of September
30, 2021 related to the main contingencies and provisions of the Company is provided below:
|
1.
|
Probable Contingent liabilities
|
Regulatory Authority’s Penalty Activities
Telecom Argentina is subject to various penalty
procedures, in most cases promoted by the Regulatory Authority, for delays in the reparation and, to a lesser extent, for installation
of service to fix-line customers. Although generally a penalty considered on an individual basis does not have a material effect on Telecom
Argentina’s equity, there is a significant disproportion between the amounts of the penalty imposed by the Regulatory Authority
and the revenue that the affected customer has generated to Telecom Argentina.
On March 3, 2021, the “Sanctions Regime applicable
to ICT Services” was approved through ENACOM Resolution No. 221/21, ad referendum of ENACOM Board of Directors. The mentioned Resolution,
among others, provides: (i) the penalty reference unit as the PBU-SBT value effective as of the date of payment, (ii) a maximum penalty
equivalent to 50,000 PBU-SBT and a minimum penalty equivalent to 50 PBU-SBT, (iii) the publication of the penalties imposed in media and/or
institutional website; and (iv) the possibility of imposing daily penalties for every day of non-compliance. The resolution was ratified
by the ENACOM Board of Directors on April 28, 2021 through Synthesized Resolution No. 581/21.
The Company filed a spontaneous presentation to
ENACOM communicating its complete adherence to the recourse filed by “Asociación Argentina de Televisión por Cable”
(“ATVC”) against the provisions of that resolution, for considering that it is illegitimate and, consequently, that it should
be revoked.
As of the date of these unaudited consolidated
financial statements, the Company is analyzing the impact of this new regulation.
TELECOM
ARGENTINA S.A.
|
2.
|
Possible Contingencies
|
Resolution No. 50/10 and subsequent ones
of the Secretariat of Domestic Trade of the Nation (“SCI”)
SCI Resolution No. 50/10 approved certain rules
to commercialize pay television services. These rules provide that cable television operators must apply a formula to calculate their
monthly subscription prices. The price arising from the application of the formula was to be informed to the Office of Business Loyalty
(Dirección de Lealtad Comercial), having cable television operators to adjust such amount semi-annually and informing the result
of such adjustment to such Office. The Company filed an administrative appeal against Resolution No. 50/10 requesting the suspension of
its effects and its nullification.
Additionally, according to the decision issued
on August 1, 2011 in judicial cause “LA CAPITAL CABLE S.A. V. Ministerio de Economía-Secretaría de Comercio Interior
de la Nación”, the Federal Court of Appeals of the City of Mar del Plata has ordered the SCI to suspend the application of
Resolution No. 50/10 with respect to all cable television licensees represented by ATVC. The preliminary injunction ordered by the Court
of Mar del Plata was notified to the SCI and the Ministry of Economy on September 12, 2011 and became fully effective. The National Government
filed an appeal against the decision issued by the Court of Mar del Plata. Such appeal was dismissed, for which the National Government
filed a direct appeal to the Supreme Court, which was also dismissed.
Notwithstanding the foregoing, between March 2011
and October 2014 successive resolutions were published in the Official Gazette based on Resolution 50/10 that regulated the prices that
Cablevision should charge in monthly basis fees to users. These resolutions were challenged and suspended due to the aforementioned injunction.
However, each Resolution had a valid period of three to six months, with the last one expiring in October 2014.
In September 2014, the Court issued a decision
in judicial cause “Municipalidad de Berazategui V. Cablevisión” ordering the remission of the cases relating to these
resolutions to the jurisdiction of the Court of Mar del Plata, that had issued the decision on the collective action in favor of ATVC.
Currently, all judicial causes related to this
issue are processed in the Federal Justice of Mar del Plata.
In April 2019, La Capital Cable S.A. was notified
of the resolution issued by the Federal Court No. 2 of Mar del Plata in which declared the unconstitutionality of certain sections of
a law on which the SCI was based for the issuance of Resolution No. 50/10 and the successive resolutions. The declaration of unconstitutionality
means that these resolutions are not applicable to La Capital Cable and the companies grouped by ATVC. However, the National Government
filed an appeal against that resolution.
On December 26, 2019, the Federal Court of Mar
del Plata rejected the grievances of the National Government and confirmed the decision rendered by the court of first instance which
declared the unconstitutionality of the sections of the law based on which the SCI issued Resolution No. 50/10 and the subsequent resolutions.
The National Government filed an extraordinary appeal, which was granted on March 1, 2021.
The Company, with the assistance of its legal advisors,
is analyzing the potential impacts related to this new appeal.
NOTE 18 – ADDITIONAL INFORMATION
Financial assets and liabilities denominated
in foreign currencies
Financial assets and liabilities denominated in
foreign currencies as of September 30, 2021 and December 31, 2020 are the following:
|
09.30.2021
|
12.31.2020
|
|
In equivalent millions of Argentine pesos
|
Assets
|
22,632
|
28,274
|
Liabilities
|
(236,678)
|
(282,516)
|
Net Liabilities
|
(214,046)
|
(254,242)
|
In order to reduce this net position (debt) in
foreign currency, Telecom has NDF as of September 30, 2021 amounting to US$100 million, therefore the net liability not hedged amounts
to approximately US$2,067 million as of that date.
TELECOM
ARGENTINA S.A.
Offsetting
of financial assets and financial liabilities in scope of IFRS 7
The information required by the
amendment to IFRS 7 as of September 30, 2021 and December 31, 2020 is as follows:
|
As
of September 30, 2021
|
|
Trade
receivables
|
Other
receivables
|
Trade
payables
|
Other
liabilities
|
Current
and non-current assets (liabilities) - Gross value
|
22,555
|
1,324
|
(47,789)
|
(271)
|
Offsetting
|
(2,530)
|
(169)
|
2,530
|
169
|
Current
and non-current assets (liabilities) – Book value
|
20,025
|
1,155
|
(45,259)
|
(102)
|
|
As
of December 31, 2020
|
|
Trade
receivables
|
Other
receivables
|
Trade
payables
|
Other
liabilities
|
Current
and non-current assets (liabilities) - Gross value
|
27,257
|
2,146
|
(58,471)
|
(774)
|
Offsetting
|
(1,214)
|
(123)
|
1,214
|
123
|
Current
and non-current assets (liabilities) – Book value
|
26,043
|
2,023
|
(57,257)
|
(651)
|
Telecom and its subsidiaries
offset the financial assets and liabilities to the extent that such offsetting is provided by agreements and provided that Telecom has
the intention to make such offsetting, in accordance with requirements established in IAS 32. The main financial assets and liabilities
offset correspond to transactions with other national and international operators including interconnection, carriers and Roaming (being
offsetting a standard practice in the telecommunications industry at international level that Telecom and its subsidiaries apply regularly).
Offsetting is also applied to transactions with agents.
NOTE 19 – PURCHASE COMMITMENTS
The Company has entered into various purchase commitments
with domestic and foreign suppliers amounting to approximately $130,946 as of September 30, 2021 (of which $28,529 corresponds to PP&E
commitments).
NOTE 20 – EQUITY
As of September 30, 2021 and December 31, 2020,
the capital stock of Telecom Argentina amounts to $2,153,688,011, represented by the same number of common book-entry shares with nominal
value of $1 peso, as detailed below:
Class of Shares
|
|
Total
|
Class “A”
|
|
683,856,600
|
Class “B”
|
|
628,058,019
|
Class “C”
|
|
106,734
|
Class “D”
|
|
841,666,658
|
Total
|
|
2,153,688,011
|
As of the date of these unaudited consolidated
financial statements, all the shares of Telecom Argentina are authorized by the CNV for public offering.
Class B Shares are listed and traded on the leading
companies’ panel of the BYMA and the American Depositary Shares (ADS) representing 5 Class “B” shares of the Company
are traded on the NYSE under the symbol TEO.
|
(b)
|
Provisions of the Telecom Ordinary and Extraordinary Shareholders’
meeting
|
The Ordinary and Extraordinary
Shareholders’ meeting of Telecom held on April 28, 2021 decided, among other issues, the following:
(a)
To approve the Annual Report and the financial statements of Telecom as of December 31, 2020.
|
(b)
|
To approve the Board of Directors’ proposal expressed in current currency of March 31, 2021 using
the National Consumer Price Index (National CPI), as provided by CNV Resolution No. 777/18, consisting in: (i) the absorption of the negative
Retained earnings as of December 31, 2020 amounting to $6,455,431,747 Argentine pesos ($7,827 in current currency as of September 30,
2021) from the “Facultative Reserve to maintain the capital investments level and the current level of solvency” and (ii)
the reclassification of $13,776,401,012 Argentine pesos ($16,049 in current currency as of September 30, 2021) from the “Facultative
Reserve to maintain the capital investments level and the current level of solvency” to the “Contributed Surplus”.
|
TELECOM
ARGENTINA S.A.
NOTE 21 – REVENUES
Revenues include:
|
Three-month periods ended
September 30,
|
|
Nine-month periods ended
September 30,
|
|
2021
|
2020
|
|
2021
|
2020
|
Mobile Services
|
36,987
|
40,389
|
|
110,898
|
121,529
|
Internet Services
|
21,058
|
20,564
|
|
62,077
|
67,168
|
Cable Television Services
|
18,457
|
18,877
|
|
57,433
|
62,140
|
Fixed and Data Services
|
12,795
|
15,740
|
|
41,082
|
48,722
|
Other services revenues
|
281
|
249
|
|
683
|
877
|
Subtotal Services revenues
|
89,578
|
95,819
|
|
272,173
|
300,436
|
Equipment revenues
|
6,676
|
6,371
|
|
20,810
|
17,040
|
Total Revenues
|
96,254
|
102,190
|
|
292,983
|
317,476
|
NOTE 22 – OPERATING EXPENSES
Operating expenses disclosed by nature of expense
amounted to $291,798 and $287,908 for the nine-month periods ended September 30, 2021 and 2020, respectively. The main components of the
operating expenses are the following:
|
Three-month periods
ended September 30,
|
|
Nine-month periods
ended September 30,
|
|
2021
|
2020
|
|
2021
|
2020
|
|
Profit (loss)
|
Employee benefit expenses and severance payments
|
|
Salaries, Social security expenses and benefits
|
(19,373)
|
(17,780)
|
|
(55,024)
|
(55,147)
|
Severance indemnities
|
(2,076)
|
(548)
|
|
(4,173)
|
(2,435)
|
Other employee expenses
|
(427)
|
(548)
|
|
(1,150)
|
(1,376)
|
|
(21,876)
|
(18,876)
|
|
(60,347)
|
(58,958)
|
Fees for services, maintenance, materials and supplies
|
|
|
|
|
|
Maintenance and materials
|
(6,438)
|
(5,930)
|
|
(19,239)
|
(18,648)
|
Fees for services
|
(4,536)
|
(4,749)
|
|
(13,856)
|
(14,466)
|
Directors and Supervisory Committee members’ fees
|
(66)
|
(81)
|
|
(353)
|
(198)
|
|
(11,040)
|
(10,760)
|
|
(33,448)
|
(33,312)
|
Taxes and fees with the Regulatory Authority
|
|
|
|
|
|
Turnover tax
|
(3,556)
|
(3,718)
|
|
(10,867)
|
(11,461)
|
Municipal taxes
|
(1,007)
|
(1,060)
|
|
(3,147)
|
(3,257)
|
Other taxes and fees
|
(2,808)
|
(2,980)
|
|
(8,588)
|
(9,328)
|
|
(7,371)
|
(7,758)
|
|
(22,602)
|
(24,046)
|
Cost of equipment and handsets
|
|
|
|
Inventory balance at the beginning of the period / year
|
(3,959)
|
(4,317)
|
|
(5,446)
|
(6,424)
|
Plus:
|
|
|
|
|
|
Purchases
|
(4,437)
|
(4,993)
|
|
(13,138)
|
(10,687)
|
Other
|
74
|
350
|
|
185
|
931
|
Less:
|
|
|
|
|
|
Inventory balance at the end of the period
|
3,647
|
5,147
|
|
3,647
|
5,147
|
|
(4,675)
|
(3,813)
|
|
(14,752)
|
(11,033)
|
Other operating expenses
|
|
|
|
|
|
Provisions
|
(2,240)
|
(3,280)
|
|
(4,342)
|
(3,603)
|
Rentals and internet capacity
|
(753)
|
(622)
|
|
(2,025)
|
(2,014)
|
Energy, water and other services
|
(1,623)
|
(1,725)
|
|
(4,813)
|
(5,986)
|
Other
|
(979)
|
(932)
|
|
(2,655)
|
(2,940)
|
|
(5,595)
|
(6,559)
|
|
(13,835)
|
(14,543)
|
TELECOM
ARGENTINA S.A.
|
|
|
|
|
Three-month periods ended
September 30,
|
|
Nine-month periods
ended September 30,
|
|
2021
|
2020
|
|
2021
|
2020
|
|
Profit (loss)
|
Depreciation, amortization and impairment of fixed assets
|
|
|
|
|
|
Depreciation of PP&E
|
(26,610)
|
(22,934)
|
|
(75,712)
|
(66,648)
|
Amortization of intangible assets
|
(3,503)
|
(4,174)
|
|
(10,532)
|
(10,986)
|
Amortization of rights of use assets
|
(2,411)
|
(1,904)
|
|
(6,862)
|
(5,893)
|
Impairment of fixed assets
|
(546)
|
(183)
|
|
(1,107)
|
(427)
|
|
(33,070)
|
(29,195)
|
|
(94,213)
|
(83,954)
|
Operating expenses, disclosed per function are
as follows:
Concept
|
Operating
costs
|
Administra-
tion costs
|
Commerciali-
zation costs
|
Total
09.30.2021
|
Total
09.30. 2020
|
Employee benefit expenses and severance payments
|
(36,111)
|
(9,960)
|
(14,276)
|
(60,347)
|
(58,958)
|
Interconnection costs and transmission costs
|
(10,678)
|
-
|
-
|
(10,678)
|
(11,702)
|
Fees for services, maintenance, materials and supplies
|
(17,576)
|
(5,306)
|
(10,566)
|
(33,448)
|
(33,312)
|
Taxes and fees with the Regulatory Authority
|
(22,340)
|
(88)
|
(174)
|
(22,602)
|
(24,046)
|
Commissions and advertising
|
-
|
-
|
(16,530)
|
(16,530)
|
(17,536)
|
Cost of equipment and handsets
|
(14,752)
|
-
|
-
|
(14,752)
|
(11,033)
|
Programming and content costs
|
(20,031)
|
-
|
-
|
(20,031)
|
(20,805)
|
Bad debt expenses
|
-
|
-
|
(5,362)
|
(5,362)
|
(12,019)
|
Other operating expenses
|
(7,080)
|
(955)
|
(5,800)
|
(13,835)
|
(14,543)
|
Depreciation, amortization and impairment of fixed assets
|
(76,412)
|
(8,517)
|
(9,284)
|
(94,213)
|
(83,954)
|
Total as of 09.30.2021
|
(204,980)
|
(24,826)
|
(61,992)
|
(291,798)
|
|
Total as of 09.30.2020
|
(192,613)
|
(28,438)
|
(66,857)
|
|
(287,908)
|
NOTE 23 – FINANCIAL RESULTS,
NET
|
Three-month periods ended
September 30,
|
Nine-month periods ended
September 30,
|
|
2021
|
2020
|
2021
|
2020
|
|
Profit (loss)
|
Interests on financial debts (*)
|
(3,618)
|
(4,525)
|
(10,891)
|
(15,953)
|
Foreign currency exchange gains (losses) on financial debts (**)
|
11,565
|
(1,349)
|
32,110
|
(10,857)
|
Financial debt renegotiation results
|
-
|
(4,704)
|
-
|
(4,704)
|
Total Debt financial results
|
7,947
|
(10,578)
|
21,219
|
(31,514)
|
Gains (Losses) on operations with notes and bonds
|
534
|
4,371
|
(492)
|
4,795
|
Other exchange differences (***)
|
699
|
1,103
|
5,240
|
4,318
|
Other interests, net and other investments results
|
(58)
|
(680)
|
(1,187)
|
(997)
|
Other taxes and bank expenses
|
(1,002)
|
(1,018)
|
(2,921)
|
(2,912)
|
Financial expenses on pension benefits
|
(74)
|
(78)
|
(247)
|
(252)
|
Financial discounts on assets, debts and others
|
(762)
|
24
|
(2,480)
|
(70)
|
RECPAM
|
2,991
|
2,197
|
11,458
|
6,454
|
Total other financial results, net
|
2,328
|
5,919
|
9,371
|
11,336
|
Total financial results, net
|
10,275
|
(4,659)
|
30,590
|
(20,178)
|
(*) Includes ($286) and ($276) corresponding
to net losses generated by NDF in the nine-month periods ended September 30, 2021 and 2020, respectively.
(**) Includes ($847) and ($1,642) corresponding to net losses generated
by NDF in the nine-month periods ended September 30, 2021 and 2020, respectively.
(***) Includes $99 and $912 corresponding to income related to decreases
in financial assets at amortized cost in the nine-month period ended September 30, 2021.
NOTE 24 - BALANCES AND TRANSACTIONS WITH COMPANIES UNDER SECTION
33 - LAW No. 19,550 AND RELATED PARTIES
On January 1, 2018, Cablevisión was merged
with Telecom Argentina (surviving entity), which was approved by the CNV (and registered in the IGJ under No. 16,345, Book 91, Tome “Corporations”).
Since such date, CVH is the controlling company of Telecom Argentina, holding directly and indirectly
28.16% of the capital stock of the Company. Additionally, both VLG S.A.U. (company controlled by CVH) and Fintech Telecom, LLC, contributed
to the Voting Trust, according to the Shareholders’ Agreement, shares representing 10.92% of the capital of the Company, respectively,
so the shares subject to such agreement represent 21.84% of the capital of the Company (the “Shares in Trust”).
TELECOM
ARGENTINA S.A.
According
to the Voting Trust Agreement, the trustee appointed by CVH must vote the Shares in Trust as instructed or voted by CVH with respect to
all issues except in respect of certain matters subject to veto under the Shareholders’ Agreement.
For the purposes of these unaudited consolidated
financial statements, related parties are those individuals or legal entities which are related to Telecom in terms of IAS 24.
c)
Balances with Companies under section 33 - Law No. 19,550 and Related Parties
|
·
|
Companies under section 33 - Law No. 19,550
– Associates
|
|
September 30,
|
December 31,
|
|
2021
|
2020
|
CURRENT ASSETS
|
|
|
Trade receivables
|
|
|
Ver TV
|
-
|
3
|
|
-
|
3
|
Other receivables
|
|
|
La Capital Cable
|
185
|
144
|
TSMA
|
-
|
3
|
Ver TV
|
2
|
14
|
|
187
|
161
|
CURRENT LIABILITIES
|
|
|
Trade payables
|
|
|
TSMA
|
1
|
-
|
|
1
|
-
|
|
|
|
Other liabilities
|
|
|
Televisora Privada del Oeste S.A.
|
3
|
3
|
|
3
|
3
|
|
September 30,
|
December 31,
|
|
2021
|
2020
|
CURRENT ASSETS
|
|
|
Trade receivables
|
|
|
Other Related parties
|
170
|
223
|
|
170
|
223
|
Other receivables
|
|
|
Other Related parties
|
5
|
44
|
|
5
|
44
|
CURRENT LIABILITIES
|
|
|
Trade payables
|
|
|
Other Related parties
|
1,268
|
1,250
|
|
1,268
|
1,250
|
d)
Transactions with Companies under section 33 - Law No. 19,550 and related parties
|
·
|
Companies under section 33 - Law No. 19,550–
Associates
|
|
Transaction
|
Nine-month periods
ended September 30,
|
|
|
|
2021
|
2020
|
|
|
|
Profit (loss)
|
|
|
|
Revenues
|
|
La Capital Cable
|
Services revenues and other revenues
|
30
|
43
|
|
Ver TV
|
Services revenues and other revenues
|
4
|
-
|
|
|
|
34
|
43
|
|
|
|
Operating costs
|
|
La Capital Cable
|
Fees for services
|
(59)
|
(56)
|
|
|
|
(59)
|
(56)
|
|
|
|
Financial Results
|
Ver TV
|
Interests
|
-
|
46
|
TSMA
|
Interests
|
-
|
20
|
|
|
-
|
66
|
TELECOM
ARGENTINA S.A.
|
Transaction
|
Nine-month periods
ended September 30,
|
|
|
2021
|
2020
|
|
|
Profit (loss)
|
|
|
Revenues
|
Other Related parties
|
Services and advertising revenues
|
210
|
223
|
|
|
210
|
223
|
|
|
Operating costs
|
Other Related parties
|
Programming costs
|
(2,930)
|
(3,383)
|
Other Related parties
|
Editing and distribution of magazines
|
(598)
|
(767)
|
Other Related parties
|
Advisory services
|
(398)
|
(372)
|
Other Related parties
|
Advertising purchases
|
(342)
|
(496)
|
Other Related parties
|
Other purchases and commissions
|
(124)
|
(169)
|
|
|
(4,392)
|
(5,187)
|
The transactions discussed above were made by Telecom
under the same conditions than would have been obtained from unaffiliated third parties, When Telecom’s transactions represented
more than 1% of its total shareholders’ equity, they were approved according to Law No. 26,831, the Bylaws and the Executive Committees’
Faculties and Performance Regulation.
e)
Amendment of the Telecom Argentina’s Bylaws
The Extraordinary General
Meeting and the Special Meetings of the Class “A” and Class “D” Shares held on October 10, 2019 approved the amendment
of sections 4, 5 and 6 of the Bylaws, so that the shares Class “A” and Class “D”, currently book-entry, may be
represented in a cardboard or in book-entry form, as determined by a special meeting of Class “A” or Class “D”
shares. The delegation of powers to the Board of Directors was approved to determine the time, terms and condition of issuance of the
securities representing the cardboard shares, in the event that this was resolved in the future by the respective Special Meetings of
Class “A” and Class “D” shares.
Afterwards, General Extraordinary
Shareholders’ Meeting and Class “A” and Class “D” Shares Special Shareholders’ Meetings held on December
11, 2020 approved the amendment of section 10 of the Bylaws so as to establish a minimum prior notice for any call to Board Meetings of
5 calendar days, except in the event of urgency, in which case the Meeting may be called with a prior notice of 1 day, and to establish
new notification procedures to calls for such Meetings.
On April 14, 2021, the
Company was notified by the IGJ of the registration of both Bylaws’ amendments.
NOTE 25 – RESTRICTIONS ON DISTRIBUTION
OF PROFITS
Under the LGS, the by-laws of the Company and rules
and regulations of the CNV, a minimum of 5% of net income for the year in accordance with the statutory books, plus/less previous years’
adjustments and accumulated losses must be appropriated by resolution of the shareholders to a legal reserve until such reserve reaches
20% of the outstanding capital (common stock) plus inflation adjustment of common stock.
NOTE 26 – IMPACT OF CORONAVIRUS IN TELECOM
Since the beginning of 2020 and given the extent
of the Covid-19 spread, several governments in the world implemented diverse measures to restrict the movement of the population and to
content the spread of the virus.
In Argentina, the National Government ordered the
Mandatory and Preventive Social Isolation from March 20, 2020, which only allowed the movement of individuals involved in the provision/production
of essential services and products, among them, the provision of telecommunication services.
On November 9, 2020, the National Government ordered
the Mandatory and Preventive Social Distancing, in which the provision of telecommunication services remained considered as “essential”.
During the second quarter of 2021, and as a result
of the outbreak of Covid-19, the National Government determined new restrictions and measures aimed at controlling the community circulation
of the virus throughout the national territory. However, during the third quarter of 2021 the aforementioned restrictions were decreasing
according to the slowdown in the community circulation of the virus in that period. The implemented measures do not directly affect Telecom's
operation as the provision of telecommunication services remained considered as essential.
TELECOM
ARGENTINA S.A.
Telecom provides services that are critical for
society as it connects people, homes, companies and governments. which became a priority during the pandemic. Services provided by the
Company also allow small, medium and large companies to remain in business, and therefore contribute to sustain the country’s economy.
Moreover, services provided by the Company, in this context, have allowed people to stay connected and entertained, as well as to work
remotely and remain informed from their homes.
By the end of 2020, Argentina began the national
vaccination campaign under the direct management of the National and Provincial Governments and the Government of the Autonomous City
of Buenos Aires. During the first quarter of 2021 the national vaccination campaign was aimed at the population in risk (older people)
and health and education staff. During the second and third quarter of 2021, the national vaccination campaign included the remaining
adult population. Finally, on October 2021, the vaccination campaign included children over 3 years of age, prioritizing those with pre-existing
comorbidities.
|
ü
|
External initiatives implemented by Telecom
related to the health emergency
|
The pandemic has driven joint actions by domestic
companies that gave essential support to face the health emergency. Telecom, as part of its permanent commitment to its community in response
to the Covid-19 emergency, has taken several initiatives of great social value, which are disclosed in Note 29 to the consolidated financial
statements as of December 31, 2020, standing out the provision of connectivity for field hospitals and discounts in services for health
and educational entities, that remain until today, in addition to benefits to customers to take even more advantage of the connection
possibilities and to access to valuable information and to educational and entertainment content.
|
ü
|
Internal initiatives implemented by Telecom
related to the health emergency
|
On the other hand, the Company implemented a series
of initiatives to ensure the continuity of its operations, safeguarding the health and the wellness of all the employees and of those
that are part of the value chain which are disclosed in Note 29 to the consolidated financial statements as of December 31, 2020. Among
these initiatives stand out the creation of a Crisis Committee or the implementation of home office for more than 70% of its employees
and the infrastructure works reinforcement, which provided networks with the capacity required to continue operating without any inconvenience.
|
ü
|
Main Accounting Impacts
|
As of the date of these unaudited consolidated
financial statements, the Company has not experienced any significant impacts on its results as a consequence of the pandemic. Despite
the several difficulties that caused a slowdown or complexities in our operations; we continue operating and we expect to continue without
any inconvenience.
In accordance with IAS 36, the Company’s
Management has assessed if there were indicators of impairment of the recoverable value of its fixed assets. Even though the pandemic
could have a significant impact in the economic activity in Argentina, what could be an impairment trigger, according to mentioned assessment,
no negative impacts have been identified in the capacity of generation of future cash flows of the Company as a consequence of the pandemic,
as the volume of operations is expected to remain stable.
On the other hand, the Company’s Management
estimates that the deterioration of the economic situation of the country represents an increase in trade receivables credit risk at the
end of the reporting period.
Telecom and its subsidiaries have enough liquidity,
bank credit lines and a notes program that allow them to finance their short-term obligations and the investment plan in addition to the
projected operating cash flows.
It is estimated that, during the second half of
2021, Argentina will continue with a mixed presence and virtual schedule in a large part of the industrial, commercial and educational
activities and whose evolution will depend on the health scenario. The ultimate effects of Covid-19 and its impact on the global and local
economy are still unknown. Governments may issue stricter measures, which cannot be predicted.
The Company’s Management will continue to
develop actions that minimize the potential impairment on its results, as a result of these situations, maintaining a level of service
and customer satisfaction, and seeking to maximize the precautions in social management in this context.
The Company's Board of Directors and the Crisis
Committee continue monitoring the evolution of the situation and taking the necessary measures to preserve human life and the sustainability
of Telecom's businesses.
TELECOM
ARGENTINA S.A.
NOTE 27 – RECENT DEVELOPMENTS CORRESPONDING
TO THE NINE-MONTH PERIOD ENDED SEPTEMBER 30, 2021
|
a)
|
Decree No. 690/20 - Amendment to the LAD
|
On August 22, 2020, the PEN issued Decree No. 690/20
(“DNU No. 690/20”) amending the LAD. DNU No. 690/20 declared ICT services (which includes fixed and mobile telephony services,
cable television and Internet –as well as access to telecommunications networks for and between licensees as “Essential and
Strategic Competition Public Services”, and empowered ENACOM to ensure accessibility.
DNU No. 690/20 further established that the prices
of the Essential and Strategic Competition Public ICT Services, the prices of those services provided in accordance with the Universal
Service and the prices of those services determined by ENACOM for public interest reasons, shall be regulated by ENACOM.
Moreover, DNU No. 690/20 established that ENACOM
is the agency responsible for the enactment of any regulation related to the ICT’s Compulsory Universal Telecommunication Service
(“PBU”).
Finally, DNU No. 690/20 suspended any price increases
or changes set or announced by the ICT’s licensees from July 31, 2020 to December 31, 2020.
DNU No. 690/20 was ratified by the Argentine Congress
under Law No. 26,122 and regulated through ENACOM Resolutions No. 1,466/20 and 1,467/20.
Resolution No. 1,466/20 allowed ICT licensees providing
Internet access services, subscription broadcasting services through physical, radio-electric or satellite link, fixed telephony services
and mobile telecommunications services -in all cases in their different and respective modalities- to increase retail prices for services
up to 5% during January 2021. Licensees must consider the prices effective as of July 31, 2020 as the price of reference for such increase.
Such Resolution also provided that ICT Services Licensees may request a higher increase on an exceptional basis in accordance with the
provisions of Section 48 of the LAD.
Resolution No. 1,467/20 regulated the PBU provided
by DNU No. 690/20 for the different services provided by ICT licensees, namely:
|
·
|
PBU-SBT: Compulsory Universal Provision of Basic
Fixed Telephony Service;
|
|
·
|
PBU-SCM: Compulsory Universal Provision of Basic
Mobile Communication Service;
|
|
·
|
PBU-I: Compulsory Universal Provision of Basic
Internet Access Value Added Service;
|
|
·
|
PBU-TP: Compulsory Universal Basic Provision of
subscription television services by physical or radio-electric or satellite link.
|
Resolution No. 1,467/20 further determined the
price and the characteristics of each PBU and its beneficiaries. Licensees are under the obligation to report on a monthly basis the number
of customers subscribed to the different PBU. Finally, Resolution No. 1,467/20 also imposed different reporting obligations to be fulfilled
before the ENACOM on the licensees that hold registration for subscription broadcasting services by physical or radio electric link and
on licensees of subscription television audiovisual communication services by satellite link.
On the other hand, the Company ordered a price
recomposition since January 2021, failing to transfer to the price of its services, the inflation accumulated in the period March-December
2020, as a result of different measures provided by the PEN. Additionally, the Company initiated legal proceedings before the Federal
Court of Appeals on Administrative Litigation Matters challenging the constitutionality of DNU No. 690/20 and the aforementioned ENACOM
Resolutions, which was notified to the PEN on October 7, 2021.
In this context, the Company requested a precautionary
measure to suspend the application of the aforementioned regulations. On January 29, 2021, such precautionary measure was rejected and
was appealed by the Company.
On April 30, 2021, the Chamber of the Federal Court
of Appeals on Administrative Litigation Matters decided to accept the Company’s appeal, revoke the origin instance court’s
decision and, consequently, grant the preliminary injunction requested, ordering the suspension of the effects of sections 1, 2, 3, 4,
5 and 6 of DNU No. 690/20 and resolutions provided as a consequence and their non-applicability to the Company for a period of six months.
As supported by the preliminary injunction granted, the Company ordered a new price recomposition in June and September 2021.
TELECOM
ARGENTINA S.A.
In reaching its decision, the Court considered,
that the “configuration of circumstances prima facie lead to serious and founded questioning of Decree 690/2020's reasonability
standard and legitimacy and of ENACOM's resolutions adopted as a consequence, due to the direct adverse effects they have on Telecom Argentina's
property rights, which derive from Information and Communication Technology services provision, under a free competition system, ruled,
authorized and granted (depending on the case), by the National State itself”.
The National Government and ENACOM filed extraordinary
legal proceedings against the mentioned decision of the Federal Court of Appeals on Administrative Litigation Matters, which were denied
on June 18, 2021 through the decision of Chamber II decision the Federal Court of Appeals on Administrative Litigation Matters.
On June 29, 2021, the PEN and ENACOM filed legal
proceedings before the Argentine Supreme Court of Justice. As of the date of these unaudited consolidated financial statements, the mentioned
legal proceedings have not been attended.
On October 21, 2021, the Company was notified of
the resolution of the Federal Court on Administrative Litigation Matters No. 8, through which it resolved to extend for another six-month
period the precautionary measure opportunely granted.
The Company, with the assistance of its legal advisors,
is analyzing the actions available to the Company in order to protect its legal rights.
Preliminary injunction requested by “Asociación
Civil de Usuarios Bancarios Argentinos” (“ACUBA”)
On January 27, 2021, the Company was served with
notice of a preliminary injunction granted by the Civil and Commercial Court No. 10 of Mar del Plata obtained by ACUBA in the aforementioned
case, which ordered the Company to roll back the tariffs of broadcasting services subscriptions, Internet access services, fixed telephony
services and mobile telecommunications services to those of December 2020, which could only be increased up to 5% as authorized by ENACOM,
and maintain such tariffs until any modification is resolved. Telecom challenged the preliminary injunction for lack of jurisdiction,
and requested that the resolution granting the preliminary injunction be declared nulled. Telecom further requested that the preliminary
injunction be lifted. A decision from the court remains pending as of the date of these unaudited consolidated financial statements. The
Company argued that a preliminary injunction obtained by a representative of the industry of the Province of Córdoba from the federal
courts of the province expressly suspended the application of DNU No. 690/20, Decree No. 311/20 and prohibited ENACOM from issuing any
subsequent resolutions.
The Company, with the assistance of its legal advisors,
is analyzing the actions that may be necessary in order to protect its rights.
Preliminary injunction requested by a representative
of the industry of the Province of Córdoba
On February 2, 2021, the Company was informed by
the Asociación Argentina de Televisión por Cable (“ATVC”), that a preliminary injunction requested by a representative
of the cable television industry was granted by a Federal Court of the Province of Córdoba, that ordered the suspension of DNU
No. 690/20, of Decree No. 311/20 and of all measures adopted as a result of those decrees. The court also ordered the PEN and the ENACOM
to abstain from issuing or pursuing any subsequent measures based on such decrees, until a final court decision is rendered.
ATVC also informed that, pursuant to the court’s
indications, the regulatory authority should refrain from issuing regulations related to DNU No. 690/20 or enforcing the regulations previously
issued, which are generally suspended.
Preliminary injunction “Catrie Televisora
Color S.R.L. c/ Estado Nacional s/ Acción meramente declarativa de inconstitucionalidad”
On March 31, 2021, the Company was informed by
ATVC, that in the case Catrie Televisora Color S.R.L. c/ Estado Nacional s/ Acción meramente declarativa de inconstitucionalidad”
(File No. 858/21), pending before the Federal Court of Córdoba No. 1, ATVC requested joint litigation, under the terms of Art.
90 inc. 2 of the National Civil and Commercial Procedure Code, requiring collective legitimacy, on behalf of the associated companies,
and required the extension of the preliminary injunction issued in such case.
TELECOM
ARGENTINA S.A.
Likewise, on that date ATVC was notified of the
resolution of the Federal Court of Córdoba No. 1 of March 30, 2021, which provided, in File. No. 858/21, the following summary:
1) grant the request for intervention of a third party made by ATVC; 2) direct the process as a collective process; 3) delimit the class
affected to the cable and ICT services industries that are associated with ATVC; and 4) order the National Government the suspension of
DNU No. 690/20, as well as all measures adopted as a result of that decree. The court also ordered the PEN and the ENACOM to abstain from
issuing or pursuing any subsequent measures based on such decree, until a final court decision is rendered, in relation to all the certified
class companies of this process.
The Company, together with its legal advisors,
is analyzing the effects of this preliminary injunction, since Telecom Argentina is an associate of ATVC.
|
b)
|
Interests in Joint Operations
|
Telecom holds a 50% share in the UTE Ertach –
Telecom Argentina, which is engaged in the provision of data transmission services and the order channels required to integrate the public
administration agencies of the Province of Buenos Aires and the municipal agencies in a single provincial data communication network.
The UTE had an agreement in effect with the Ministry
of the Cabinet Chief of the Province of Buenos Aires, which was approved pursuant to Decree No. 2017-166-E-GDEBA-GPBA, which was in the
“termination of services phase”, situation that involved the continuity of the UTE’s operations until the Government
of the Province of Buenos Aires provides for a new service supplier.
Given the technical impossibility for a new supplier
to provide the service immediately and being the UTE the only one capable of providing it under current conditions, the Ministry of the
Cabinet Chief of the Province of Buenos Aires, through Resolution No. 3,046/2021, approved the direct engagement of the UTE for continuing
to provide services for a twelve months’ period renewables for another twelve months if requested by the mentioned Ministry.
|
c)
|
Acquisition of Opalker S.A.
|
On July 27, 2021, Telecom Argentina acquired all
the shares representing the total subscribed Capital Stock´s of the Uruguayan company Opalker S.A.. The intention of Telecom Argentina
is to commercialize cybersecurity products and services and / or related services through this company.
As of the date of these unaudited consolidated
financial statements, Opalker S.A. is a dormant entity.
|
d)
|
Irrevocable contribution in cash to Micro Sistemas
|
On January 11, 2021, Telecom made an irrevocable
contribution in cash for the future subscription of shares of Micro Sistemas, for a total amount of $62 ($ 81 million in current currency
as of September 30, 2021), which were capitalized by the General Extraordinary Shareholders’ Meeting of Micro Sistemas held on January
19, 2021.
On September 22, 2021, Telecom made an irrevocable
contribution in cash for the future subscription of shares of Micro Sistemas, for a total amount of $260.
As of the date of these unaudited consolidated
financial statements, the aforementioned contribution has not been capitalized by Micro Sistemas.
NOTE 28 – SUBSEQUENT EVENTS TO SEPTEMBER
30, 2021
Santander Río Bank Loan
On October 14, 2021, the Company subscribed a loan
agreement with Banco Santander Río S.A. for a total amount of $1,.500. Total principal will be settled by one payment at maturity
date, which will be on October 17, 2022. The loan bears interest that will be paid in a monthly basis from its issuance date until its
maturity date maturity at a fixed nominal annual rate of 37.5%.
TELECOM
ARGENTINA S.A.
Offer for Irrevocable Call and Put Option
on the Shares of AVC Continente Audiovisual
On September 25, 2019, Telecom and the non-controlling
shareholders of AVC Continente Audiovisual (the “Assignors”) executed an Offer for an Irrevocable Call and Put Option on all
the shares of AVC Continente Audiovisual (“AVC”) held by the Assignors (497,474 common shares, representing 40% of total ACV
capital stock). The call and put option could be exercised by Telecom Argentina and the Assignors, respectively, since October 1, 2019
until September 30, 2024. The call and put options include, together with the shares, the assignment and transfer of all the economic
and political rights inherent therein.
On October 27, 2021, Telecom Argentina exercised
the call option on 497,479 common shares of $1 nominal value each and entitled to one (1) vote per share representing 40% of total ACV
capital stock and votes, as the Assignors exercised the put option on such shares, cancelling the remaining balance for a total amount
to $ 56.
|
|
Carlos Moltini
|
|
|
Chairman of the Board of Directors
|
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
AS OF SEPTEMBER 30, 2021
(In millions of Argentine pesos or as expressly indicated)
|
1.
|
General considerations
|
As required by CNV regulations, the Company has
prepared its unaudited consolidated financial statements as of September 30, 2021 under IFRS.
As provided under Resolution No. 777 issued by
the CNV on December 28, 2018, this Report discloses the comparative balances for the nine-month period ended September 30, 2020, restated
to current currency as of September 30, 2021.
The table below shows
the evolution of the National Consumer Price Index (National CPI with the characteristics identified in Note 1.e) to the unaudited consolidated
financial statements) of the last two years and as of June 30, 2021 and 2020 according to official statistics (INDEC) and the Banco Nación
US dollar exchange rate used for the preparation of this operating and financial review and prospects and the accompanying financial statements:
|
As of December
31, 2019
|
As of
September
30, 2020
|
As of December
31, 2020
|
As of
September
30, 2021
|
|
|
|
|
|
National Consumer Price Index (December 2016=100)
|
283.44
|
346.62
|
385.88
|
528.50
|
|
|
|
|
|
Variation in Prices
|
|
|
|
|
Annual / Interannual
|
53.8%
|
36.6
|
36.1%
|
52.5%
|
Accumulated 3 months since June 2020 / 2021
|
n/a
|
7.7%
|
n/a
|
9.3%
|
Accumulated 9 months
|
n/a
|
22.3
|
n/a
|
37.0
|
|
|
|
|
|
Banco Nación US$/$ exchange rate
|
59.89
|
76.18
|
84.15
|
98.74
|
|
|
|
|
|
Variation in the exchange rate
|
|
|
|
|
Annual / Interannual
|
58.9%
|
32.3%
|
40.5%
|
29.6%
|
Accumulated 3 months since June 2020 / 2021
|
n/a
|
8.1%
|
n/a
|
3.2%
|
Accumulated 9 months
|
n/a
|
27.2%
|
n/a
|
17.3%
|
|
2.
|
Telecom’s activities for the nine-month periods ended September, 2021 (“9M21”)
and 2020 (“9M20”)
|
|
|
Variation
|
|
9M21
|
9M20
|
$
|
%
|
Revenues
|
292,983
|
317,476
|
(24,493)
|
(7.7)
|
Employee benefit expenses and severance payments
|
(60,347)
|
(58,958)
|
(1,389)
|
2.4
|
Interconnection and transmission costs
|
(10,678)
|
(11,702)
|
1,024
|
(8.8)
|
Fees for services, maintenance, materials and supplies
|
(33,448)
|
(33,312)
|
(136)
|
0.4
|
Taxes and fees with the Regulatory Authority
|
(22,602)
|
(24,046)
|
1,444
|
(6.0)
|
Commissions and advertising
|
(16,530)
|
(17,536)
|
1,006
|
(5.7)
|
Cost of equipment and handsets
|
(14,752)
|
(11,033)
|
(3,719)
|
33.7
|
Programming and content costs
|
(20,031)
|
(20,805)
|
774
|
(3.7)
|
Bad debt expenses
|
(5,362)
|
(12,019)
|
6,657
|
(55.4)
|
Other operating expenses
|
(13,835)
|
(14,543)
|
708
|
(4.9)
|
Depreciation, amortization and impairment of fixed assets
|
(94,213)
|
(83,954)
|
(10,259)
|
12.2
|
Operating income
|
1,185
|
29,568
|
(28,383)
|
(96.0)
|
Earnings from associates
|
210
|
567
|
(357)
|
(63.0)
|
Financial results, net
|
30,590
|
(20,178)
|
50,768
|
n/a
|
Income before income tax expense
|
31,985
|
9,957
|
22,028
|
221.2
|
Income tax expense
|
(30,960)
|
(11,861)
|
(19,099)
|
161.0
|
Net income (loss)
|
1,025
|
(1,904)
|
2,929
|
n/a
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
Controlling Company
|
358
|
(2,508)
|
2,866
|
n/a
|
Non-controlling interest
|
667
|
604
|
63
|
10.4
|
|
1,025
|
(1,904)
|
2,929
|
n/a
|
Basic and diluted earnings (losses) per share attributable to the Controlling Company (in Argentine pesos)
|
0.17
|
(1.16)
|
|
|
In relation to the economic performance, operating
income amounted to $1,185, representing 0.4% of consolidated revenues. Additionally, financial results amounted to a gain of $30,590
and income tax expenses amounted to $30,960, mainly due to the statutory income tax rate change in accordance to Law No. 27,630. As a
result, Net income amounted to $1,025.
|
|
|
Variation
|
|
9M21
|
9M20
|
$
|
%
|
Mobile Services
|
110,898
|
121,529
|
(10,631)
|
(8.7)
|
Internet Services
|
62,077
|
67,168
|
(5,091)
|
(7.6)
|
Cable Television Services
|
57,433
|
62,140
|
(4,707)
|
(7.6)
|
Fixed and Data Services
|
41,082
|
48,722
|
(7,640)
|
(15.7)
|
Other services revenues
|
683
|
877
|
(194)
|
(22.1)
|
Subtotal Services revenues
|
272,173
|
300,436
|
(28,263)
|
(9.4)
|
Equipment revenues
|
20,810
|
17,040
|
3,770
|
22.1
|
Total Revenues
|
292,983
|
317,476
|
(24,493)
|
(7.7)
|
During 9M21 consolidated revenues showed a decrease
of 7.7% (-$24,493 vs. 9M20) amounting to $292,983. This decrease in revenues is noted in services revenues, partially offset by higher
Equipment revenues.
Albeit the greater demand for services, accompanied
by a stable churn, consolidated revenues decreased because the rate of inflation for the last twelve months amounted to 52.52% and the
Company did not transfer a portion of this effect to its prices as a result of the different measures provided by the National Government.
Services revenues amounted to $272,173 in 9M21
(-9.4% vs. 9M20) and represent 92.9% of consolidated revenues. Mobile Services revenues amounted to $110.898 in 9M21 (-$10,631 vs. 9M20).
Internet Services revenues amounted to $62,077 in 9M21 (-$5,091 vs. 9M20). Cable Television Services revenues amounted to $57,433 in 9M21
(-$4,707 vs. 9M20) and Fixed and Data Services revenues amounted to $41,082 in 9M21 (-$7,640 vs, 9M20), Equipment revenues increased 22.1%,
amounting to $20,810 in 9M21 and represent 7.1% of consolidated revenues.
Consolidated Revenues include $34,845 and $127,581
in 9M21 and 9M20, respectively, related to the effect generated by the restatement in current currency as of September 30, 2021.
Mobile Services
Mobile Services revenues
amounted to $110,898 (-$10,631 or -8.7% vs. 9M20), being the main business in term of service revenues (40.7% and 40.5% of services revenues
in 9M21 and 9M20, respectively).
The effect generated by the restatement in current
currency as of September 30, 2021 included in mobile services revenues amounted to $13,124 and $48,755 in 9M21 and 9M20, respectively.
Mobile Services revenues
in Argentina amounted to $98,547(- $7,226 or -6.8% vs. 9M20) due to decrease in ARPU, partially offset by a slight increase of the customer
base.
Personal's mobile customers
amounted to 19.5 million and 18.7 million as of September 30, 2021 and 2020, respectively. The main ratios related to the services provided
to these customers were:
|
·
|
As of September 30, 2021, 58% of total customers
are prepaid customers, and 42% are postpaid customers, while, as of September 30, 2020, 59% of total customers were prepaid customers
and 41% were postpaid customers.
|
|
·
|
Mobile Internet services revenues are equivalent
to 73% of Personal’s customer’s total services revenues.
|
|
·
|
The monthly average revenue per user (“ARPU”)
is $568.0 Argentine pesos per month in 9M21 (vs. $611.7 Argentine pesos per month in 9M20), representing a decrease of 7.1%, The effect
generated by the restatement in current currency as of September 30, 2021 included in ARPU amounted to $65.8 Argentine pesos and $246.3
Argentine pesos in 9M21 and 9M20, respectively.
|
|
·
|
The average churn rate per month positioned into
1.1% in 9M21 (vs. 2.2% average in 9M20).
|
Regarding infrastructure, the Company continued
to enhance the mobile Internet experience of its customers through the deployment of its 4G and 4G+ network throughout the country, reaching
more than 13.9 million customers with 4G devices throughout the country. The traffic carried by 4G technologies in 9M21 corresponds to
the 92% of the total traffic.
Likewise, the number and variety of mobile offers
with more data services to improve the connectivity of our customers were deepened, expanding the benefits of the plans to increase performance
and their use. In this scenario, the WiFi Pass service was launched, which allows customers who are also subscribed to Internet service
to activate free of charge gigabytes for exclusive use to share Internet from their handsets with any other device, without consuming
data from their original plan.
Mobile services revenues
generated in Paraguay amounted to $12,351 (-$3,405 or -21.6% vs. 9M20) due to decrease of the customer base and a slight decrease in ARPU,
partially offset by the appreciation of the Guaraní against the Argentine Peso.
The main ratios related to the mobile services
in Paraguay were:
|
·
|
Núcleo's mobile customers decrease 1.5%,
amounting to in 2.2 million as of September 30, 2021, with 82% of total customers consist of prepaid customers and 18% consist of postpaid
customers, while as of September 30, 2020 84% of total customers consist of prepaid customers and 16% consist of postpaid customers.
|
|
·
|
The monthly ARPU amounted to $588.8 Argentine
pesos per month in 9M21 (vs. $621.7 pesos in 9M20), representing a 5.3% decrease.
|
|
·
|
The average churn rate per month amounted to 3.4%
in 9M21 (vs. 3.5% in 9M20).
|
Internet Services
Internet services revenues amounted to $62,077
in 9M21 (-$5,091 or -7.6% vs. 9M20) driven mainly by the 13.6% decrease in broadband ARPU, which amounted to $1,580.5 Argentine pesos
in 9M21 (vs. $1,829.2 Argentine pesos in 9M20). The effect generated by the restatement in current currency as of September 30, 2021 included
in ARPU amounts to $187.4 Argentine pesos and $736.5 Argentine pesos in 9M21 and 9M20, respectively.
It should be noted that
customers with service of 20Mb or higher represent 78% and 70% of the total customer base as of September 30, 2021 and 2020, respectively.
Within this range, there are customers who have plans of 100 Mb, 300 Mb and 1,000 Mb that as of September 30, 2021 amounted to 932,592,
155,995 and 7,786, respectively.
Internet services subscriber base increased 1.5%
in 9M21 amounting to 4.2 million customers. Churn rate per month positioned into 1.5% and 1.2% as of September 30, 2021 and 2020, respectively.
The effect generated by the restatement in current
currency as of September 30, 2021 included in Internet Services revenues amounts to $7,336 and $27,056 in 9M21 and 9M20, respectively.
Cable Television Services
Cable Television Services revenues amounted to
$57,433 in 9M21 (-$4,707 or -7.6% vs. 9M20). The variation is mainly due to a 10.7% decrease in ARPU, amounting to $1,749.2 Argentine
pesos in 9M21 (vs. $1,959.7 Argentine pesos in 9M20). The effect generated by the restatement in current currency as of September 30,
2021 included in ARPU amounts to $211.5 Argentine pesos and $789.1 Argentine pesos in 9M21 and 9M20, respectively.
Subscriber base in Argentina remains stable amounting
to 3.3 million customers as of September 30, 2021, of which 1.1 million are subscribed to Flow. Churn rate per month of Cable television
services positioned into 1.1% and 0.9 % as of September 30, 2021 and 2020, respectively.
In November 2020, we incorporated Disney+ and in
August 2021, we incorporated Paramount+ into the Flow ecosystem, to transform it into a comprehensive platform so that customers continue
to choose it both for its content offering and for its differential functionalities. Flow today, in addition to TV, series, films and
documentaries on demand and exclusive co-productions, includes music and gaming. Related to the last mentioned, the consolidation of Esports
as an entertainment phenomenon and local consumption continued and will continue to grow as customer needs evolve.
The effect generated by the restatement in current
currency as of September 30, 2021 included in Cable television services revenues amounts to $6,921 and $25,067 in 9M21 and 9M20, respectively.
Fixed Telephony and Data Services
Fixed Telephony and Data Services revenues amounted
to $41,082 in 9M21 (-$7,640 or -15.7% vs. 9M20).
The effect generated by the restatement in current
currency as of September 30, 2021 included in Fixed and Data Services revenues amounts to $4,969 and $19,569 in 9M21 and 9M20, respectively.
The average monthly revenue
billed per user (“ARBU”) of fixed telephony services amounted to $708.2 Argentine pesos in 9M21 (vs. $827.5 Argentine pesos
in 9M20). The effect generated by the restatement in current currency as of September 30, 2021 included in ARBU amounts to $88.3 Argentine
pesos and $333.3 Argentine pesos in 9M21 and 9M20, respectively.
Equipment
Equipment revenues amounted
to $20,810 in 9M21 (+$3,770 or +22.1% vs. 9M20). This variation is mainly due to an increase in handsets sold as compared to 9M20 (+43%),
complemented by an increase of approximately 37% in handset average sale prices as compared to 9M20.
It is important to highlight
that the Company, in terms of devices, continued to promote the updating of the handsets with financed offers and special discounts focused
on the convergence of services.
The effect generated by the restatement in current
currency as of September 30, 2021 included in Equipment revenues amounts to $2,442 and $6,785 in 9M21 and 9M20, respectively.
Operating costs (without depreciation, amortization and impairment
of fixed assets)
Operating costs (without depreciation, amortization
and impairment of fixed assets) amounted to $197,585 in 9M21, which represents a decrease of $6,369 or -3.1% vs. 9M20. These lower costs
are related with the decrease in bad debt expenses, taxes and fees with the Regulatory Authority, Interconnection and transmission costs,
and Commissions and advertising, partially offset by an increase employee benefit expenses and severance payments and costs of equipment
and handsets.
The effect generated by the restatement in current
currency as of September 30, 2021 included in operating costs amounts to $25,960 and $82,722 in 9M21 and 9M20, respectively.
The operating costs breakdown is mainly as follows:
Employee benefit expenses and severance payments
Employee benefit expenses
and severance payments amounted to $60,347 in 9M21 (-$1,389 or +2.4% vs. 9M20). The increase is mainly due to increases in salaries agreed
by the Company with several trade unions with respect to unionized employees as well as to non-unionized employees, together with related
social security charges and to higher charges for dismissals, partially offset by the effect of the decrease in headcount (22,846 employees
in 9M21).
The effect generated by
the restatement in current currency as of September 30, 2021 included in employee benefit expenses and severance payments amounts to $7,020
and $23,712, as of 9M21 and 9M20, respectively.
Interconnection and transmission costs
Interconnection and transmission
costs, which also includes charges for roaming, cost of international outbound calls and lease of lines and circuits, amounted to $10,678
in 9M21 (-$1,024 or -8.8% vs. 9M20). The decrease is mainly due to fewer links and sites, partially offset by increases in the exchange
rate in relation to services in U$S.
The effect generated by
the restatement in current currency as of September 30, 2021 included in interconnection and transmission costs amounts to $1,300 and
$4,665 in 9M21 and 9M20, respectively.
Fees for services, maintenance, materials and supplies
Fees for services, maintenance,
materials and supplies amounted to $33,448 in 9M21 (+$136 or +0.4% vs. 9M20). Fees for services decreased $455 while fees for maintenance,
materials and supplies increased $591 vs. 9M20.
The effect generated by
the restatement in current currency as of September 30, 2021 included in fees for services, maintenance, materials and supplies amounts
to $4,823 and $13,846 in 9M21 and 9M20, respectively.
Taxes and fees with the Regulatory Authority
Taxes and fees with the
Regulatory Authority, including turnover tax, municipal taxes and other taxes and fees, decreased, amounting to $22,602 in 9M21 (-$1,444
or -6.0% vs. 9M20). This decrease is mainly due to the effect of lower revenues in 9M21 vs. 9M20. Taxes and fees with the Regulatory Authority
represent 7.7% and 7.6% of consolidated revenues in 9M21 and 9M20, respectively.
The effect generated by
the restatement in current currency as of September 30, 2021 included in taxes and fees with the Regulatory Authority amounts to $2,702
and $9,661 in 9M21 and 9M20, respectively.
Commissions and advertising
Commissions (including
commissions paid to agents, collection commissions and other commissions) and advertising amounted to $16,530 in 9M21 (-$1,006 or -5.7%
vs. 9M20). The decrease is mainly due to lower charges for agent commissions and lower advertising services costs.
The effect generated by
the restatement in current currency as of September 30, 2021 included in commissions and advertising amounts to $1,922 and $7,037 in 9M21
and 9M20, respectively.
Cost of equipment and handsets
Cost of equipment and
handsets sold amounted to $14,752 in 9M21 (+$3,719 or +33.7% vs. 9M20). Thereby, $14,046 of such amount correspond to cost of handsets
sold in Argentina, which increased 39.4% vs. 9M20, mainly due to higher handsets sold and the increase in the purchase prices of handsets.
The effect generated by
the restatement in current currency as of September 30, 2021 included in cost of equipment and handsets amounts to $3,031 and $4,852 in
9M21 and 9M20, respectively.
Programming and content costs
Programming and content
costs amounted to $20,031 in 9M21 (-$774 or -3.7% vs. 9M20), mainly due to commercial efficiencies, partially offset by price increases
of approximately 40% in almost all signals.
The effect generated by
the restatement in current currency as of September 30, 2021 included in programming and content costs amounts to $2,474 and $8,415 in
9M21 and 9M20, respectively.
Bad debt expenses
Bad debt expenses amounted to $5,362 in 9M21 (-$6,657
or -55.4% vs. 9M20). Bad debt expenses represent 1.8% and 3.8% of total consolidated revenues in 9M21 and in 9M20, respectively. The decrease
is mainly due to the different actions undertaken by the Company in retail defaulted-payment management since the end of 2020, which results
have an impact in 9M21. Through several campaigns and promotions, bad debt receivables are recovered from clients who, in many cases,
had suffered a degradation of their services or were in a situation of disconnection, as a result of the pandemic and the general economic
situation of the country. Regarding corporate segment customers, collection procedures were carried, and resulted in the recovery of important
receivables.
The effect generated by
the restatement in current currency as of September 30, 2021 included in bad debt expenses amounts to $589 and $4,844 in 9M21 and 9M20,
respectively.
Other operating expenses
Other operating expenses, which include provisions,
energy and other public services, insurance, leases and internet capacity, among others, amounted to $13,835 in 9M21 (-$708 or -4.9% vs,
9M20). The decrease is mainly due to lower energy costs, rentals and internet capacity charges, partially offset by higher provisions.
The effect generated by
the restatement in current currency as of September 30, 2021 included in other operating expenses amounts to $2,099 and $5,701 in 9M21
and 9M20, respectively.
Depreciation, amortization and impairment of fixed assets
Depreciation, amortization
and impairment of fixed assets amounted to $94,213 in 9M21 (+$10,259 or +12.2% vs. 9M20). The increase is due to the impact of the amortization
of the CAPEX subsequent to September 30, 2020 as a consequence of the adjusted investment plan that the Company is developing.
The effect generated by
the restatement in current currency as of September 30, 2021 included in depreciation, amortization and impairment of fixed assets amounts
to $56,776 and $57,948 in 9M21 and 9M20, respectively.
Operating income amounted to $1,185 in 9M21 (-$28,338
or -96,0% vs. 9M20), representing 0.4% of consolidated revenues in 9M21 vs. 9.3 % in 9M20.
|
|
Varition
|
|
9M21
|
9M20
|
$
|
%
|
Interests on financial debts
|
(10,891)
|
(15,953)
|
5,062
|
(31.7)
|
Foreign currency exchange gains (losses) on financial debts
|
32,110
|
(10,857)
|
42,967
|
n/a
|
Financial debt renegotiation results
|
-
|
(4,704)
|
4,704
|
(100.0)
|
Total debt financial results
|
21,219
|
(31,514)
|
52,733
|
(167.3)
|
Others foreign currency exchange
|
5,240
|
4,318
|
922
|
21.4
|
(Loss) gains on operations with notes and bonds
|
(492)
|
4,795
|
(5,287)
|
n/a
|
Other interests, net and other investments results
|
(1,187)
|
(997)
|
(190)
|
19.1
|
RECPAM
|
11,458
|
6,454
|
5,004
|
77.5
|
Other
|
(5,648)
|
(3,234)
|
(2,414)
|
74.6
|
Total other financial results, net
|
9,371
|
11,336
|
(1,965)
|
(17.3)
|
Total financial results, net
|
30,590
|
(20,178)
|
50,768
|
n/a
|
Financial gain, net amounted to $30,590 in 9M21
(vs. a loss of $20,178 in 9M20). Financial Results, net in 9M21 mainly include foreign exchange gains measured in real terms of $37,350
as a result of a 17.3% devaluation of the Argentine peso against the US dollar vs, a 37.0% inflation (vs. a loss of $6,539 in 9M20, 27.2%
devaluation of the Argentine peso against the US dollar vs. a 22.3% inflation), and the effect generated by the restatement in current
currency, which amounted to a gain of $11,418 (vs. $6,454 in 9M20). These effects are partially offset by losses of (i) interest on financial
debts, measured in real terms, of $10,891 (vs. a loss of $15,953 in 9M20), (ii) operations with notes and bonds of $492 (iii) other interest,
net and other investment results of $1,187 and other financial results of $5,648.
Telecom’s income tax charge includes the
following effects: (i) the current tax payable pursuant to tax legislation applicable to Telecom and (ii) the effect of applying the deferred
tax method on temporary differences arising out of the Company’s asset and liability valuation according to tax vs, financial accounting
criteria, including the income tax inflation effect.
Income tax expense amounted to $30,960 in 9M21
vs. $11,861 in 9M20. It mainly includes the change in the statutory income tax rate in accordance with the provisions of Law No. 27,630,
which replaced the 25% rate with a scale of increasing rates based on the taxable income of each taxpayer that reaches 35% since fiscal
year 2021. Therefore, it includes the following effects: (i) regarding current tax expenses, Telecom generated a $12,710 tax expense in
9M21 (vs. $224 in 9M20), and (ii) regarding the deferred tax in 9M21. Telecom recorded a deferred tax loss of $18,250 in 9M21 (vs. 11,637
in 9M20).
Telecom Argentina recorded a net income of $1,025
in 9M21 (vs. a net loss of $1,904 in 9M20) and represents +0,3% of consolidated revenues (vs. -0.6% in 9M20). Net income recorded in 9M21
is mainly due to operating income amounting to $1,185 and financial gains, net amounting to $30,590, partially offset by income tax expenses
of $30,960.
Net income attributable to controlling shareholders
amounted to $358 in 9M21 vs. a net loss amounting to $2,508 in 9M20.
|
·
|
Financial position, net
|
The consolidated financial
position, net (that is: Cash and cash equivalents plus Financial investments and IFD less Financial debts) is debt and amounted to $223,416
and $239,683 as of September 30, 2021 and as of December 31, 2020, respectively.
|
·
|
Capital expenditures (CAPEX) and Rights of use assets additions
|
CAPEX and Rights of use assets additions composition
9M21 and 9M20 is as follows:
|
In millions of $
|
Variation
|
|
9M21
|
9M20
|
$
|
%
|
PP&E
|
51,931
|
51,140
|
791
|
1.5
|
Intangibles assets
|
1,969
|
2,194
|
(225)
|
(10.3)
|
Total CAPEX
|
53,900
|
53,334
|
566
|
1.1
|
Rights of use assets
|
12,619
|
8,720
|
3,899
|
44.7
|
Total
|
66,519
|
62,054
|
4,465
|
7.2
|
The Company and its subsidiaries’ main PP&E
CAPEX projects are related to the expansion of cable TV and internet services in order to improve the transmission and speed offered to
customers; the deployment of 4G services to support the growth of mobile Internet services, improvement of the quality service together
with the launch of innovative VAS services.
During 9M21 Telecom continued with the expansion
of transmission and transport networks to join the different access technologies, converting the fixed copper networks to fiber or hybrid
fiber-coaxial networks to meet, in this way, the demand of services of both fixed telephony and mobile services customers. Likewise, we
continued with our investments in the pricing, billing and customer relationship systems.
|
3.
|
Telecom Group’s activities for the three-month periods ended September 30, 2021 (“3Q21”)
and 2020 (“3Q20”)
|
|
|
Variation
|
|
3Q21
|
3Q20
|
$
|
%
|
Revenues
|
96,254
|
102,190
|
(5,936)
|
(5.8)
|
Operating costs without depreciation, amortization and impairment of fixed assets
|
(67,797)
|
(67,212)
|
(585)
|
0.9
|
Depreciation, amortization and impairment of fixed assets
|
(33,070)
|
(29,195)
|
(3,875)
|
13.3
|
Operating (loss) income
|
(4,613)
|
5,783
|
(10,396)
|
n/a
|
Earnings from associates
|
84
|
213
|
(129)
|
(60.6)
|
Financial results, net
|
10,275
|
(4,659)
|
14,934
|
n/a
|
Income before income tax expense
|
5,746
|
1,337
|
4,409
|
329.8
|
Income tax expense
|
(2,894)
|
(6,459)
|
3,565
|
(55.2)
|
Net income (loss)
|
2,852
|
(5,122)
|
7,974
|
n/a
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
Controlling Company
|
2,549
|
(5,370)
|
7,919
|
(147.5)
|
Non-controlling interest
|
303
|
248
|
55
|
22.2
|
|
2,852
|
(5,122)
|
7,974
|
n/a
|
|
|
|
|
|
Basic and diluted earnings (losses) per share attributable to the Controlling Company (in Argentine pesos)
|
1.18
|
(2.49)
|
|
|
Revenues in 3Q21 amounted to $96,254, operating
costs (without depreciation, amortization and impairment of fixed assets) amounted to $67,797, depreciation, amortization and impairment
of fixed assets amounted to $33,070 (equivalent to 34.4% of consolidated revenues) and operating loss amounted to $4,613 (equivalent to
-4.8% of consolidated revenue in 3Q21 vs. 5.7% in 3Q20).
Services revenues amounted to $89,578 in 3Q21 -equivalent
to 93.1% of consolidated revenues-, and equipment revenues amounted to $6,676 in 3Q21 –equivalent to 6.9% of consolidated revenues–.
Mobile services revenues amounted to $36,987 in
3Q21 –equivalent to 41.3% of consolidated services revenues– which were mainly generated by Personal’s customers in
Argentina.
Internet services revenues amounted to $21,058
in 3Q21 –equivalent to 23.5% of consolidated services revenues–.
Cable television services revenues amounted to
$18,457 in 3Q21 –equivalent to 20.6% of consolidated service revenues– and they are mainly composed of services revenues provided
in Argentina and Uruguay.
Finally, Fixed and data services revenues amounted
to $12,795 in 3Q21 –equivalent to 14.3% of consolidated service revenues–.
Operating costs without depreciation, amortization
and impairment of fixed assets amounted to $67,797 in 3Q21, being the main components, employee benefit expenses and severance payments
(amounted to $21,876); fees for services, maintenance, materials and supplies (amounted to $11,014); taxes and fees with the Regulatory
Authority (amounted to $7,371); programming and content costs (amounted to $6,318); and commissions and advertising (amounted to $5,547).
Financial results, net amounted to a gain of $10,275
in 3Q21, mainly due to net foreign exchange gains, measured in real terms, amounting to $12,264, the net gain on restatement in current
currency amounting to $2,291, and gains on operations with notes and bonds of $534, partially offset by losses on: interests on financial
debts amounting to $3,618, other interests, net and other investments results amounting to $758and other financial results amounting to
$1,838.
Income tax expense amounted to $2,894 in 3Q21,
Therefore, Telecom Argentina obtained a net income amounting to $2,852 in 3Q21, (which represents +3.0% of consolidated revenues). Net
income attributable to the controlling shareholders amounted to $2,549 in 3Q21.
|
4.
|
Summary of comparative consolidated statements of financial position
|
|
September 30,
|
|
2021
|
2020
|
2019
|
2018
|
Current assets
|
54,831
|
98,242
|
134,231
|
122,674
|
Non-current assets
|
923,687
|
958,158
|
980,446
|
952,027
|
Total assets
|
978,518
|
1,056,400
|
1,114,677
|
1,074,701
|
Current liabilities
|
150,967
|
143,087
|
158,047
|
273,308
|
Non-current liabilities
|
334,972
|
339,462
|
360,560
|
180,498
|
Total liabilities
|
485,939
|
482,549
|
518,607
|
453,806
|
Equity attributable to the Controlling Company
|
484,846
|
565,265
|
587,022
|
610,986
|
Equity attributable non-controlling interest
|
7,733
|
8,586
|
9,048
|
9,909
|
Total Equity
|
492,579
|
573,851
|
596,070
|
620,895
|
Total liabilities and equity
|
978,518
|
1,056,400
|
1,114,677
|
1,074,701
|
|
5.
|
Summary of comparative consolidated income statements
|
|
9M21
|
9M20
|
9M19
|
9M18
|
Revenues
|
292,983
|
317,476
|
332,665
|
370,574
|
Operating costs
|
(291,798)
|
(287,908)
|
(302,671)
|
(311,549)
|
Operating income
|
1,185
|
29,568
|
29,994
|
59,025
|
Earnings from associates
|
210
|
567
|
(425)
|
436
|
Financial results, net
|
30,590
|
(20,178)
|
(29,912)
|
(107,320)
|
Income (loss) before income tax expense
|
31,985
|
9,957
|
(343)
|
(47,859)
|
Income tax expense
|
(30,960)
|
(11,861)
|
(26,106)
|
23,520
|
Net income (loss)
|
1,025
|
(1,904)
|
(26,449)
|
(24,339)
|
Other comprehensive (loss) income, net of tax
|
(3,977)
|
(1,509)
|
(1,586)
|
8,884
|
Total comprehensive (loss)
|
(2,952)
|
(3,413)
|
(28,035)
|
(15,455)
|
Attributable to Controlling Company
|
(2,679)
|
(3,601)
|
(28,479)
|
(17,911)
|
Attributable to non-controlling interest
|
(273)
|
188
|
444
|
2,456
|
|
6.
|
Summary of comparative consolidated statements of cash flow
|
|
9M21
|
9M20
|
9M19
|
9M18
|
Net cash flows provided by operating activities
|
90,476
|
109,450
|
116,207
|
81,292
|
Net cash flows used in investing activities
|
(84,615)
|
(71,956)
|
(57,967)
|
(52,086)
|
Net cash flows used in financing activities
|
(11,930)
|
(55,289)
|
(1,999)
|
(26,124)
|
Net foreign exchange differences and RECPAM on cash and cash equivalents
|
(2,234)
|
2,255
|
2,220
|
8,810
|
Total cash and cash equivalents (used) provided during the period
|
(8,303)
|
(15,540)
|
58,461
|
11,892
|
|
7.
|
Statistical data (in physical units in index-term)
|
|
09.30.21
|
09.30.20
|
09.30.19
|
09.30.18
|
Cable TV Subscribers (i)
|
102.0%
|
102.2%
|
100.6%
|
102.0%
|
Internet Access (ii)
|
104.6%
|
103.0%
|
102.0%
|
101.7%
|
Fixed telephony services lines (ii)
|
83.3%
|
84.4%
|
87.7%
|
95.6%
|
Personal Mobile telephony services lines (ii)
|
102.9%
|
98.3%
|
100.0%
|
97.4%
|
Núcleo’s customers (ii)
|
97.2%
|
96.0%
|
95.9%
|
96.8%
|
|
(i)
|
Base December 2013= 100
|
|
(ii)
|
Base December 2017= 100
|
|
09.30.21
|
09.30.20
|
09.30.19
|
09.30.18
|
Liquidity (1)
|
0.36
|
0.69
|
0.85
|
0.45
|
Solvency (2)
|
1.01
|
1.19
|
1.15
|
1.37
|
Locked-up capital (3)
|
0.94
|
0.91
|
0.88
|
0.89
|
|
1)
|
Current assets/Current liabilities,
|
|
2)
|
Total equity/Total liabilities,
|
|
3)
|
Non-current assets/Total assets,
|
The COVID 19 emergency complex scenario continues
presenting challenges all around the world. Although the pandemic effects dimmed in the first nine months of 2021 as a result of advances
in health policy and the extension of large-scale vaccination plans, the pandemic continuity - due to the threat of new variants of the
virus and its potential growths – continues presenting a complex panorama for the last months of 2021.
In our country, the impact of the epidemiological
situation on the world’s macro-economy was particularly aggravated by the recessive effects generated by the economic paralysis
as a result of the social isolation. In order to promote sustained growth in production and private employment, a high level of commitment
from all sectors of society and greater public-private coordination will continue to be necessary.
Telecom's economic-financial results, as those
of other companies operating in the country, reflect the impact of the inflationary processes and exchange rate fluctuations, especially
considering that our main source of income is in pesos, while our industry requires intensive dollarized investments for the deployment
of infrastructure and development of systems.
In this sense, the economic scenario has forced
us to strongly focus our management on achieving operational efficiencies to maintain growth levels in line with the investments undertaken,
not only to grow but also to maintain the quality of service that we provide to our more than 29 million customers.
In addition, there is greater uncertainty for ICT
services companies arising from the issuance of Decree No. 690/20, whereby the PEN declared that ICT services are considered as public
services provided on a competitive basis.
In the last months, different courts have considered
the rule, which proposed an untimely, arbitrary and unnecessary change in the sector regulation, ordering the suspension of Decree No.
690/20 and the resolutions issued subsequently and derived from it. The preliminary injunctions that are repeated in various parts of
the country cover virtually the entire ICT industry, both large operators and SMEs.
In our case, the Chamber of the Federal Court of
Appeals on Administrative Litigation Matters decided by majority to accept the Company’s appeal and granted the precautionary measure
requested. By the end of October 2021, we were notified of the resolution of the Federal Court on Administrative Litigation Matters No.
8, through which it resolved to extend for another six-month period the precautionary measure opportunely granted.
In this way, Court ratify that the entire ICT industry
must have the capacity to set its trade policies and prices. Maintaining and encouraging competition instead of setting artificial barriers
is the only and best way for users to continue accessing to more and better services.
In Telecom we maintain our vision of continuing
to consolidate ourselves as an ecosystem of digital services, which are leveraged on connectivity and supported by a digital and cultural
transformation process focused on the experience of our customers, which we have given an extraordinary boost during the pandemic.
In the last year and a half, the digitization made
possible social and commercial relationships, education, relationships with institutions and the economy. Also, the limits between the
digital and the face-to-face were softened. And the society changed.
We were and continue to be part of that change,
accompanying and enhancing Argentines’ lives and promoting the country's digital economy. Our evolution does not stop. Therefore,
we have renewed our institutional visual identity and our commercial brands, which expresses the technological evolution that we are carrying
out to facilitate the digital development of our customers, of society and, ultimately, of the country.
From now on, our customers have full connectivity
with Personal, regardless their inside/outside home location, with the best service experience, thanks to our fixed and mobile networks.
Flow is a truly meeting point for all entertainment,
where content from the most important platforms on the market is also integrated.
And, under the Telecom brand, we continue to bring
digital solutions to the corporate and government segment, to continue contributing to their development and growth.
We are building an attractive brand for new digital
talents, fundamental in the development of services related to the digital economy, and a new work experience for our employees, with
a hybrid scheme, of face-to-face and virtually, focusing on well-being and a greater personal, family and work balance.
Finally, from a financial point of view, during
this first nine months of 2021, thanks to the confidence of the national and international markets in the company's credit strength and
in our business strategy, we issued new Series 8 Notes for a nominal value of $8,709 and Series 9 for a nominal value of $8,699 maturing
in 2025 and 2024, respectively. Also, during this period, we canceled the remaining balance of the Series “A” Notes for US$106
million and Series “3” and “4” Notes, maturing in January and July of 2021. Additionally, our subsidiary in Paraguay,
Núcleo, also entered the financial market by issuing two series of notes maturing in 2028 and 2031 for a total of approximately
$3,406. These issuances have allowed us to considerably improve our capital structure.
We expect to continue our transformation process,
consolidating our operating model and reaching new transformation milestones towards the full digitalization of our operations to become
more efficient, agile and digital, to continue boosting the growth of digital economy in our country and generating value for our customers.
|
Carlos Moltini
|
|
Chairman of the Board of Directors
|
|
·
|
INDEPENDENT AUDITORS Price Waterhouse
& Co S.R.L. (member of PricewaterhouseCoopers)
|
BYMA
|
Market
quotation ($/share)
|
Volume
of shares
|
Quarter
|
High
|
Low
|
traded
(in millions)
|
3Q20
|
235.00
|
166.15
|
5.7
|
4Q20
|
269.95
|
189.00
|
5.7
|
1Q21
|
206.65
|
157.00
|
4.5
|
2Q21
|
215.95
|
139.55
|
9.9
|
3Q21
|
196.45
|
173.75
|
9.0
|
NYSE*
|
Market
quotation (US$/ADS)
|
Volume
of ADSs
|
Quarter
|
High
|
Low
|
traded
(in millions)
|
3Q20
|
10.26
|
6.47
|
12.4
|
4Q20
|
9.12
|
6.41
|
16.6
|
1Q22
|
6.76
|
5.35
|
18.7
|
2Q21
|
6.52
|
4.40
|
36.4
|
3Q21
|
5.80
|
4.91
|
13.6
|
* Calculated at 1 ADS = 5 shares
|
·
|
INVESTOR RELATIONS for information
about Telecom Argentina S.A., please contact:
|
In
Argentina
|
Telecom
Argentina S.A.
|
Investor
Relations Division
|
General
Hornos 690
|
(1272)
Autonomous City of Buenos Aires
|
Argentina
|
https://inversores.telecom.com.ar/ar/es/contacto.html
|
Outside
Argentina
|
JPMorgan
Chase Bank N.A.
|
383
Madison Avenue, Floor 11.
|
New York, NY10179
Attn: Depositary
Receipts Group
Tel: +1 212
622 5935
|
|
·
|
INTERNET http://institucional.telecom.com.ar/inversores/
|
|
·
|
DEPOSIT AND TRANSFER AGENT FOR ADSs
|
JPMorgan
Chase Bank N.A.
|
383
Madison Avenue, Floor 11
|
New
York, NY10179
|
Attn:
Depositary Receipts Group
adr@jpmorgan.com
– www.adr.com
|