DESCRIPTION OF BUSINESS AND BASIS OF PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS (Tables)

12 Months Ended

Dec. 31, 2022

DESCRIPTION OF BUSINESS AND BASIS OF PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS

Schedule of subsidiaries included in the consolidation process and the respective equity interest owned by the company


			Telecom Argentina's
			direct/indirect interest
			in capital stock and
Company	Main Activity	Country	votes
Núcleo	Mobile telecommunications Services	Paraguay	67.50	%
Personal Envíos	Mobile financial services	Paraguay	67.50	%
Tuves Paraguay	Distribution of television and audio signals direct to home services	Paraguay	67.50	%
Micro Sistemas	Services related to the use of electronic payment media	Argentina	100.00	%
Pem	Investment	Argentina	100.00	%
Cable Imagen	Closed-circuit television	Argentina	100.00	%
Televisión Dirigida	Cable television services	Paraguay	100.00	%
Adesol (a)	Holding	Uruguay	100.00	%
AVC Continente Audiovisual (b)	Broadcasting services	Argentina	100.00	%
Inter Radios	Broadcasting services	Argentina	100.00	%
Telecom USA	Telecommunication services	USA	100.00	%
Personal Smarthome (c)	Security solutions and services	Argentina	100.00	%
Personal Smart Security (d)	Prestación de servicios de seguridad y/o servicios relacionados.	Argentina	100.00	%
Opalker (e)	Cybersecurity and related services	Uruguay	100.00	%
NYSSA. (f)	Prestación de servicios de acceso a internet.	Argentina	100.00	%

(a)	Includes the 100% interest in Telemas S.A., which holds interests in the following special-purpose entities: Audomar S.A., Bersabel S.A., Dolfycor S.A., Reiford S.A., Space Energy S.A., Tracel S.A. and Visión Satelital S.A. (See Note 3.d.4)) to these consolidated financial statements).

(b)	On October 27, 2021, Telecom acquired the remaining 40% of AVC Continente Audiovisual’s capital stock. For further information, see Note 3.d.1.a) to these consolidated financial statements.

(c)	Company started on December 30, 2020 and registered in the IGJ on June 9, 2021 As of December 31, 2022 is a dormant entity.

(d)	Company indirectly acquired on April 5, 2022 for a total consideration of $0.1 through subsidiary Personal Smarthome S.A. As of December 31, 2022 is a dormant entity.

(e)

Company acquired on July 27, 2021. On August 18, 2022, the Board of Directors of Telecom Argentina decided to make contributions to its controlled company Opalker, which were integrated through the credit that the Company had on Opalker, for US$0.2 million (equivalent to $28 in currency of 31 December 2022).

(f)	Company acquired on June 1, 2022. For further information, see Note 3.d.1.b) to these consolidated financial statements.

Schedule of income statement information

Presented below is the Segment financial information as it is analyzed by the Executive Committee and the CEO for the years ended December 31, 2022, 2021 and 2020.

◻

Consolidated Income Statement as of December 31, 2022

Services

Other

rendered in

abroad

Other abroad

Services

Argentina –

Argentina

Other

segments –

segments

rendered in

Inflation

restated for

abroad

Inflation

restated for

Argentina

restatement

inflation

segments

restatement

inflation

Eliminations

Total

Revenues

504,432

178,550

682,982

36,528

12,718

49,246

(3,046)

729,182

Operating costs without depreciation, amortization and impairment of fixed assets

(370,534)

(132,133)

(502,667)

(21,661)

(7,520)

(29,181)

3,046

(528,802)

Adjusted EBITDA

133,898

46,417

180,315

14,867

5,198

20,065

—

200,380

Depreciation, amortization and impairment of fixed assets

(495,321)

Operating loss

(294,941)

Earnings from associates

819

Debt financial expenses

29,744

Other financial results, net

32,234

Loss before income tax expense

(232,144)

Income tax expense

26,504

Net loss

(205,640)

Attributable to:

Controlling Company

(207,833)

Non-controlling interest

2,193

(205,640)

◻

Consolidated Income Statement as of December 31, 2021

Services

Other

rendered in

abroad

Other abroad

Services

Argentina –

Argentina

Other

segments –

segments

rendered in

Inflation

restated for

abroad

Inflation

restated for

Argentina

restatement

inflation

segments

restatement

inflation

Eliminations

Total

Revenues

332,816

438,992

771,808

26,215

34,719

60,934

(3,911)

828,831

Operating costs without depreciation, amortization and impairment of fixed assets

(229,554)

(308,282)

(537,836)

(15,514)

(20,771)

(36,285)

3,911

(570,210)

Adjusted EBITDA

103,262

130,710

233,972

10,701

13,948

24,649

—

258,621

Depreciation, amortization and impairment of fixed assets

(264,050)

Operating loss

(5,429)

Earnings from associates

770

Debt financial expenses

55,906

Other financial results, net

33,015

Income before income tax expense

84,262

Income tax expense

(64,900)

Net income

19,362

Attributable to:

Controlling Company

16,878

Non-controlling interest

2,484

19,362

◻

Consolidated Income Statement as of December 31, 2020

Services

Other

rendered in

abroad

Other abroad

Services

Argentina –

Argentina

Other

segments –

segments

rendered in

Inflation

restated for

abroad

Inflation

restated for

Argentina

restatement

inflation

segments

restatement

inflation

Eliminations

Total

Revenues

240,325

588,261

828,586

18,183

44,138

62,321

(4,142)

886,765

Operating costs without depreciation, amortization and impairment of fixed assets

(158,901)

(390,278)

(549,179)

(11,419)

(27,793)

(39,212)

4,142

(584,249)

Adjusted EBITDA

81,424

197,983

279,407

6,764

16,345

23,109

—

302,516

Depreciation, amortization and impairment of fixed assets

(242,847)

Operating income

59,669

Earnings from associates

1,459

Debt financial expenses

(72,619)

Other financial results, net

20,744

Income before income tax expense

9,253

Income tax expense

(24,260)

Net loss

(15,007)

Attributable to:

Controlling Company

(16,803)

Non-controlling interest

1,796

(15,007)

Schedule of financial statement information based on geographical area


	As of December 31
	2022	2021	2020
Sales revenues from customers located in Argentina	680,369	769,006	825,105
Sales revenues from foreign customers	48,813	59,825	61,660

CAPEX corresponding to the segment “Services rendered in Argentina	114,572	153,094	147,262
CAPEX corresponding to the segment “Other abroad segments”	11,697	13,552	16,606

Fixed assets corresponding to the segment “Services rendered in Argentina”	1,547,448	1,897,661	1,964,513
Fixed assets corresponding to the segment “Other abroad segments”	57,842	65,466	77,687

Financial Debt corresponding to the segment “Services rendered in Argentina”	457,123	505,299	571,839
Financial Debt corresponding to the segment “Other abroad segments”	12,066	14,644	16,797

Schedule of national consumer price index according to official statistics (INDEC)


	As of December 31,		As of December 31,		As of December 31,
	2020		2021		2022

National Consumer Price Index (December 2016=100)	385.88		582.46		1,134.59

Variation in Prices
Annual	36.1	%	50.9	%	94.8	%

Banco Nación US$/$ exchange rate	84.15		102.72		177.16

Variation in the exchange rate
Annual	40.5	%	22.1	%	72.5	%