Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
TIM PARTICIPAÇÕES S.A. Announces its
Consolidated Results for the Fourth Quarter of 2005 and Annual Results
TIM PARTICIPAÇÕES S.A. January 31, 2006 BOVESPA (lot of 1,000 shares) TCSL3: R$ 8.20 TCSL4: R$ 8.28 NYSE (1 ADR = 10,000 shares) TSU: US$ 37.25 Market Value: R$ 7.2 billion US$ 3.3 billion 4Q05 / 2005 Earnings Release Conference Call: February 2, 2006, at 2:00 p.m. Brasilia Time (11:00 a.m. US ET) For further information, please access the Companys website: www.timpartri.com.br. Contacts: Paulo Roberto C. Cozza CFO and Investor Relations Officer Tel: (55 21) 4009 3742 E-mail: pcozza@timsul.com.br Joana Serafim IR Manager Tel: (55 21) 4009-3742/8113-0571 E-mail: jserafim@timbrasil.com.br Leonardo Wanderley IR Analyst Tel: (55 21) 4009-3751/8113-0547 E-mail: lwanderley@timbrasil.com.br Cristiano Pereira IR Analyst Tel: (55 21) 4009-3751/8113-0582 E-mail: cripereira@timbrasil.com.br |
Rio de Janeiro, February 1, 2006 TIM Participações S.A. (BOVESPA: TCSL3 and TCSL4; and NYSE: TSU), TIM Sul S.A. and TIM Nordeste Telecomunicações S.A. holding company announces the results for the forth quarter of 2005 (4Q05) and 2005 annual results. TIM Participações S.A. provides mobile telecommunication services through its mobile operators in the states of Paraná, Santa Catarina, Piauí, Ceará, Rio Grande do Norte, Paraíba, Pernambuco, Alagoas and in the city of Pelotas (RS). The following financial and operational information, except as otherwise indicated, is presented on a consolidated basis and in Brazilian Reals, pursuant to the terms of Brazilian Corporate Law. The comparisons contained herein refer to the forth quarter of 2004 (4Q04) and 2004 annual results, except as otherwise indicated. |
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2005 Highlights | ||
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Management Message |
2005 was another successful year for TIM Participações. The results show that despite the great challenges and the strong pressure from competitors, the Company not only grew, but also has strengthened the long term positioning of its business.
Our client base increased 32.8%, from 5.7 million in December 2004, to 7.5 million at the end of 2005. We kept the market leadership and our ARPU average revenue per user continued to be a sector reference. The tight cost control allowed a decrease in subscriber acquisition cost (SAC) of 6.6% . EBITDA increased 14.3%, with an EBITDA Margin of 34.7% . The Service EBITDA Margin reached 43.7% and Net Income totaled R$ 399.2 million the highest in the Companys history.
TIM Participações chose an innovative path, trying to attract and keep high value clients. At the same time, we continued to increase our clients satisfaction through a segmented and personalized relationship strategy. Results came in: the Company recorded one of the smallest churn rates in the market. Quality research that has been periodically carried out by recognized institutions also show the improvement in clients satisfaction with our services when compared to competitors.
In 2005, TIM was awarded Top of Mind, for being the first Mobile Telecommunications Company that came to the mind of people, as indicated by the research conducted by DataFolha. This recognition shows the power of our brand.
GSM network extension allowed us to increase the quality of our products and services, bringing innovative solutions to a larger number of clients. Moreover, this is one of the Companys competitive advantages: the existing synergy between TIM Participações and the TIM Group, which allows the development of new services using the same technological platform, in a short period of time with reduced costs.
In 2006 our strategy is to keep clients retention and to continue the development of segmented solutions in order to maintain market leadership. We will continue to pursue the recognition and satisfaction of our clients, while focusing on profitability and thus creating value for shareholders. We are therefore counting on a strong brand, a satisfied client base and on differentiated marketing campaigns.
The Management
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Operating Performance |
Market: sharp penetration increase |
Total penetration Northeastern and South Regions was estimated at 40.8%, 11.8 p.p. over 2004 though still below the national average penetration of 46.8%, allowing strong growth potential within the region, of which TIM Participações is benefiting through its unique service portfolio. | |
Market Leadership | TIM Participações client base has reached 7,513,331 clients by the end of 2005, a 32.8% expansion over 2004. As a result, the Company held the leading position, with an estimated market share of 41.1%, stable when compared to the previous quarter (41.3%). | |
Continued postpaid expansion |
With reference to the customer mix, the postpaid segment grew by 14.3% in 2005, bringing the weight of postpaid clients on the total lines to 20.3%. | |
Net Additions Record |
In 2005 the Company has presented the highest level of net additions in its history, with 1,856,733 new clients, 30% higher than the net additions recorded in 2004. |
Fast expansion of the GSM base |
By year end, 64% of TIM Participações clients used GSM technology 4,780,732 customers, representing 72.3% and 54.5% of the client base in the Southern and Northeastern regions, respectively. In 2005, the Company experienced 524.7 thousand TDMA to GSM migrations, compared to 400.8 thousand in 2004. | |
GSM coverage in the TIM Participações region reached 662 cities servicing 87.5% of the urban population by the end of 2005. Cities covered by the GSM have access to GPRS, with the additional benefit of the EDGE technology across the South and in main cities of the Northeast Region. |
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These innovations enhanced and stimulated the use of data and multimedia by our customers, as reflected by the steady growth of our VAS revenues. |
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Churn reduction in 4Q05 |
Even in the scenario of strong growth and competition, the Company maintained its churn rate average at 1.8% per month in 2005, one of the lowest in the sector. On a quarterly bases, the performance is even better as demonstrated by a monthly churn rate in 4Q05 of 1.6%, 0.6 p.p. lower when compared to 4Q04 (- 0.5 p.p vs. 3Q 05). |
Economic-Financial Development |
Selected Data 1
% | ||||||||||||||||
4Q05 | 4Q04 | % Y-o-Y | 3Q05 | % Q-o-Q | 2005 | 2004 | ||||||||||
Year | ||||||||||||||||
Total Gross Revenue | 1,073,224 | 1,001,586 | 7.2% | 986,450 | 8.8% | 3,903,272 | 3,429,175 | 13.8% | ||||||||
Gross Service Revenue | 855,538 | 773,012 | 10.7% | 796,834 | 7.4% | 3,169,743 | 2,782,403 | 13.9% | ||||||||
Gross Handset Revenue | 217,686 | 228,574 | -4.8% | 189,616 | 14.8% | 733,530 | 646,772 | 13.4% | ||||||||
0 | 0 | |||||||||||||||
Total Net Revenue | 803,683 | 747,703 | 7.5% | 736,113 | 9.2% | 2,918,216 | 2,564,632 | 13.8% | ||||||||
Net Services Revenue | 656,593 | 590,598 | 11.2% | 613,901 | 7.0% | 2,430,688 | 2,120,727 | 14.6% | ||||||||
Net Handsets Sales | 147,090 | 157,105 | -6.4% | 122,212 | 20.4% | 487,528 | 443,905 | 9.8% | ||||||||
0.0% | 0.0% | |||||||||||||||
EBITDA | 298,198 | 260,815 | 14.3% | 255,150 | 16.9% | 1,013,187 | 886,246 | 14.3% | ||||||||
EBITDA Margin | 37.1% | 34.9% | 2.2 p.p. | 34.7% | 2.4 p.p. | 34.7% | 34.6% | 0.1 p.p. | ||||||||
0.0% | 0.0% | |||||||||||||||
EBIT | 159,556 | 116,929 | 36.5% | 122,333 | 30.4% | 480,832 | 388,105 | 23.9% | ||||||||
EBIT Margin | 19.9% | 15.6% | 4.3 p.p. | 16.6% | 3.2 p.p. | 16.5% | 15.1% | 1.4 p.p. | ||||||||
0 | 0 | |||||||||||||||
Net Income | 145,034 | 83,372 | 74.0% | 96,795 | 49.8% | 399,200 | 265,935 | 50.1% | ||||||||
Note: (1) consolidated data.
Operating Revenues | ||
The gross service revenue in 2005 totaled R$ 3.2 billion, 13.9% higher than 2004. This growth is not only attributed to the 32.8% growth in the customer base, but also to the steady increase of Value Added Service (VAS) revenues (+84.9% y-o-y reaching R$ 219.0 million in 2005) . The same drivers explain the growth in service gross revenue in the 4Q05 (R$ 855.5 million), 10.7% above that registered in the 4Q04. | ||
Handsets sales growth |
The gross handsets revenue in the year was R$ 733.5 million, a 13.4% increase over 2004, as result of the growth in handsets sold (2.4 million in 2005 vs. 1.9 million in the previous year). | |
Focusing on 4Q05, this revenue was R$ 217.7 million, a 4.8% decrease when compared to 4Q04, taking into account the reduction in the volume of handsets sold in the period (733.9 thousands in the 4Q04 versus 626.7 thousands in the 4Q05). This slowdown is mainly explained by an increase in the pre-paid entry price as a result of a more rational commercial approach: as an example during the month of December 2005 pre-paid entry price was 199 R$ compared to 149 R$ of December 2004. |
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It is important to mention that in 4Q05, as was done along 2005, TIM Participações kept improving the enhanced data enabled handsets mix: color display and MMS already represents 21% of the total handsets sold. This is the proof that customers are willing to buy more sophisticated handsets. |
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Hence, total gross revenue was R$ 3.9 billion, or 13.8% higher than the previous year. In 4Q05, total gross revenue was R$ 1.1 billion, 7.2% above 4Q04. |
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Total net revenue was R$ 2.9 billion in 2005 and R$ 803.7 million in 4Q05, a 13.8% and 7.5% increase over last year, respectively. |
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ARPU: expansion in 4Q05 versus 3Q05 |
The average revenue per user (ARPU) in 4Q05 was R$ 30.67, posting a rebound of 0.9% compared to 3Q05 (R$30.40). |
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Looking closer at 2005, ARPU was R$ 31.34 against the R$ 36.53 posted in 2004 with a reduction mainly due to the large growth of the total client base - in particular the 39% expansion in prepaid customers, and from the discontinuation of long distance services in 2005. It is worth to remind you that, in order to ensure comparability with market standards, all ARPU figures above reported are calculated considering the total net service revenue. |
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Operational Costs and Expenses |
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Stable costs in 4Q05 when compared to 4Q04 |
In 2005, the network and interconnection cost totaled R$ 435.9 million, 6.3% above the R$ 410.1 million registered in 2004, primarily due to the strong expansion in the customer base and other costs related to the higher capacity and coverage of the GSM network roll-out as well as by the maintenance costs increase due to the overlap of the two existing networks (GSM and TDMA), partially offset by the discontinuation of long-distance services. In the 4Q05, this cost represented R$ 101.3 million, in line with R$ 102.3 million posted in 4Q04 |
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The cost of goods sold basically referred to sales of handsets and accessories - reached R$ 536.5 million, 4.4% higher than the R$ 513.7 million in 2004. This increase is primarily due to the 21.1% growth in the volume of handsets sold. In a quarterly basis, such cost amounted R$ 147.7 million, 9.3% lower than in the 4Q04, because to a 14.6% reduction in total of handsets sold in the period. |
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Commercial expenses (without depreciation / amortization / bad debt and personnel) totaled R$564.4 million, 30.2% higher than 2004, primarily due to the 29% growth in gross addition (3,236,192 clients in 2005 versus 2,514,206 in 2004). The higher sales in the period boosted mainly the expenses related to sales commissions and the FISTEL rate - charged on the activation of each |
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line and over total initial base. In 2005, these expenses reached R$ 253.2 million and R$123.9 million, respectively. | ||
On a quarterly basis, the same drivers affected commercial expenses, which totaled R$ 167.8 million in the 4T05 against R$ 137.4 million in the 4Q04. | ||
SAC: Reduction of 6.6% in the year versus 2004 |
The subscribers´ acquisition and retention cost (SAC) reached R$ 116.2, which represents a 6.6% reduction over the R$124.4 posted in 2004: This is the result of strong cost control in the acquisition of new clients. The Companys rational market strategy was leveraged by the appreciation of the Brazilian Real against the U.S. Dollar and the lower average purchasing prices of handsets. SAC totaled R$ 109.2 in 4Q05 against the R$ 95.1 registered in 4Q04. The increase is related to subscribers retention cost. | |
General and administrative expenses (G&A)- excluding depreciation/amortization and personnel expenses totaled R$ 110.7 million in 2005, 5.4% higher than in 2004, due to the increase in third party services expenses. In 4Q05, those expenses totaled R$ 25.4 million against the R$ 21.4 million registered in 4Q04. |
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Personnel expenses totaled R$125.2 million in 2005 and R$ 33.1 million in 4Q05 8.2% and 6.6% higher than 2004 and 4Q04, respectively. This increase was due to headcount growth and non-recurring expenses related to the network, as well. | ||
Bad debt: reduction in percentage of total gross revenue |
Bad debt expenses totaled R$118.0 million in 2005 and R$ 27.8 million in 4Q05, making a decrease in percentage on total gross revenues from 3.3% in 2004 to 3.0% in 2005. | |
In 4Q05 the performance was particularly worth of notice as reflected by the reduction of 0.4 p.p when compared to 4Q04 (2.6% vs. 3.0%). This performance was achieved despite the Company adopted more conservative criteria for the bad debt provision, to take into account the strong growth in postpaid customers. It is important to point out that all these procedures are geared to maintain the quality of our client base. |
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EBITDA | ||
EBITDA: |
TIM Participações reported an increase of 14.3% in 2005 EBITDA (earnings before interest, taxes, depreciation and amortization) amounting R$1.013 billion, compared to R$886.2 million in 2004. EBITDA in 4Q05 reached R$ 298.2 million against the R$ 260.8 million registered in the same period of the previous year. This growth is a further proof that the Companys strategy was able to deliver a solid and profitable growth despite the strong competitive scenario and record gross additions. |
6
(R$ millions)
EBITDA Reconciliation | 4Q05 | 4Q04 | 2005 | 2004 | ||||
Net Profit | 145,034 | 83,372 | 399,200 | 265,935 | ||||
(+) Provision for Income Tax and Social Contribution | 32,866 | 20,876 | 130,338 | 108,036 | ||||
(+/-) Non-Operational Results | 428 | 399 | 2,260 | 4,592 | ||||
(+/-) Minorities Interest | - | 23,539 | 21,464 | 70,113 | ||||
(-) Net Financial Results | (18,771) | (11,257) | (72,431) | (60,571) | ||||
EBIT | 159,556 | 116,929 | 480,832 | 388,105 | ||||
(-) Amortization and Depretiation | 138,642 | 143,886 | 532,356 | 498,141 | ||||
EBITDA | 298,198 | 260,815 | 1,013,188 | 886,246 | ||||
4Q05 margin increase |
In 2005, EBITDA margin was 34.7% slightly above 2004 figures (34.6%). The service EBITDA margin was 43.6%. On a quarterly basis 4Q05 EBITDA margin was 37.1% with a sharp increase when compared to 3Q05 (+2.4 p.p.) and 4Q04s (+2.2 p.p.). |
Depreciation and Amortization |
||
Depreciation and amortization in 2005 was R$ 532.4 million, an increase of 6.9% over 2004, reflecting a 12.2% fixed asset growth in the last year, resulting mainly from the expansion and innovation of both network and information technology infrastructure. In 4Q05, depreciation and amortization totaled R$ 138.6 million versus the R$ 143.9 million registered in 4Q04, a 3.6% decrease, mainly due to the acceleration in 4Q04 of the depreciation of TDMA assets. |
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EBIT | ||
EBIT earnings before interest and taxes was R$480.8 million in 2005 and R$ 159.6 million in the 4Q05, a 23.9% and 36.5% increase when compared to 2004 and 4Q04, respectively. |
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EBIT margin was 16.5% in 2005, 1.4 p.p. over 2004. In 4Q05, the EBIT margin was 19.9%, 4.3 p.p. higher than 4Q04. | ||
Net Financial Result | ||
TIM Participações net financial result was 19.6% higher than that recorded in 2004, growing from a positive R$ 60.5 million in 2004 to R$ 72.4 million in 2005. In a quarterly comparison, net financial result was positive R$ 18.7 million, a 66.7% increase when compared to the positive R$ 11.3 million registered in the same period of 2004, mainly due to the increase in the average cash allotted for financial investments. |
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Net Income | ||
Record net income |
The consolidated net income reached a record of R$ 399.2 million - 50.1% higher than 2004, which represents R$ 0.49 per 1,000 share and R$ 4.90 per ADR .(10,000 shares). On a quarterly basis, the net income grew by 73.9%, from R$ 83.3 million in 4Q04 to R$ 145 million in 4Q05. Net income margin increased from 10.3% in 2004 to 13.7% in 2005; such expansion was also achieved occurred in the quarterly result, from 11.1% in 4Q04 to 18% in 4Q05. |
8
Indebtedness | ||
By years end, the net cash position amounted to R$ 1.1 billion. Total indebtedness, including loans and financings from BNDES and Banco do Nordeste totaled R$130.8 million, compared to R$ 104.1 million reported at the end of 2004. |
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CAPEX | ||
Capital Expenditure in 4Q05 amounted to R$ 348.4 million, totaling R$ 684.5 million invested in 2005, and primarily targeted to the expansion of the GSM network capacity and quality and the development of information technology systems, as the following table shows: |
Capex | R$ millions | |
Network | 452.9 | |
Information technology | 148.0 | |
Comodato | 68.3 | |
Others | 15.3 | |
Total | 684.5 | |
The Company will submit to shareholders approval in Annual General Meeting the R$ 543.2 million 2006 estimated CAPEX.
Ownership Breakdown |
On December 31, 2005, the Capital of TIM Participações S.A. was as following:
Common | % | Preferred | % | Total | % | |||||||
TIM Brasil Serviços e Participações S.A. | 150,804,603,591 | 50.33% | 24,053,370,461 | 4.15% | 174,857,974,052 | 19.88% | ||||||
ADR | - | 337,323,781,484 | 58.16% | 337,323,781,484 | 38.35% | |||||||
Others | 148,806,027,477 | 49.67% | 218,588,704,147 | 37.69% | 367,394,731,624 | 41.77% | ||||||
Total | 299,610,631,068 | 100.00% | 579,965,856,092 | 100.00% | 879,576,487,160 | 100.00% | ||||||
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Disclaimer | ----------------------------------------------------------------------------------------------------------------------------------------- | |
This topic may contain forward-looking statements. Such statements are not statements of historical facts, and reflect the beliefs and expectations of the Company's management. The words "anticipates, "believes, "estimates, "expects, "forecasts, "plans, "predicts, "projects, "targets" and similar words are intended to identify these statements, which necessarily involve known and unknown risks and uncertainties forecasted by the Company. Therefore, Companys future operational results may differ from current expectations and whose read this release shall not based his/hers assumptions exclusively in the information herein stated. Forward-looking statements speak only as of the date they are made, and the Company does not undertake any obligation to update them in light of new information or future
developments. |
About TIM Participações S.A. |
TIM Participações S.A. is the holding company of TIM Sul S.A. and TIM Nordeste Telecomunicações S.A., the mobile telecommunication operators that provides mobile telephony services in the states of Paraná, Santa Catarina, Piauí, Ceará, Rio Grande do Norte, Paraíba, Pernambuco, Alagoas and in the city of Pelotas, in the State of Rio Grande do Sul, an area containing 44.9 million inhabitants.
TIM Participações is controlled by TIM Brasil Serviços e Participações S.A., a Brazilian subsidiary of Telecom Italia Group, the only company authorized to operate mobile communications throughout Brazil.
TIM Participações offers GSM technology, Global System for Mobile Communications, the most widely used in the world. At the end of December 2005, its network covered 662 cities and served 87.5% of the urban population.
The cities covered by the GSM Network also have access to the GPRS and EDGE technologies. These are innovations that facilitate the use of data and multimedia services across the country.
The Company boasts one of the widest services and product portfolios, offering solutions tailored to specific needs.
TIM is the most widely known brand in both regions, and has been Top of Mind since the Company started its operations.
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List of Attachments |
Attachment 1: | Balance Sheet (BR GAAP) | |
Attachment 2: | Income Statement (BR GAAP) | |
Attachment 3: | Cash Flow Statements (BR GAAP) | |
Attachment 4: | Operational Indicators Northeastern Region | |
Attachment 5: | Operational Indicators- Southern Region | |
Attachment 6: | Consolidated Operational Indicators TIM Participações | |
Attachment 7: | Glossary | |
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Attachment 1
TIM PARTICIPAÇÕES S.A.
Balance Sheet under the Corporate Law (R$ Thousands)
DESCRIPTION | 2005 | 2004 | % | |||
ASSETS | 4,385,062 | 3,596,156 | 21.9% | |||
CURRENT ASSETS | 2,313,439 | 1,716,347 | 34.8% | |||
Cash and cash equivalents | 1,281,768 | 856,332 | 49.7% | |||
Accounts receivable | 723,335 | 608,122 | 18.9% | |||
Inventories | 81,880 | 47,200 | 73.5% | |||
Recoverable Taxes | 114,065 | 91,154 | 25.1% | |||
Deferred income and social contribution taxes | 103,118 | 108,706 | -5.1% | |||
Other current assets | 9,272 | 4,833 | 91.8% | |||
NON CURRENT ASSETS | 237,026 | 242,057 | -2.1% | |||
Related parties | 18,618 | 397 | 4588.6% | |||
Recoverable Taxes | 69,947 | 46,750 | 49.6% | |||
Deferred income and social contribution taxes | 117,477 | 163,114 | -28.0% | |||
Judicial deposits | 26,278 | 30,291 | -13.3% | |||
Other | 4,706 | 1,504 | 212.8% | |||
PERMANENT ASSETS | 1,834,597 | 1,637,752 | 12.0% | |||
Investments | 8,310 | 9,890 | -16.0% | |||
Property, plant and equipment | 1,826,288 | 1,627,862 | 12.2% | |||
LIABILITIES | 4,385,062 | 3,596,156 | 21.9% | |||
CURRENT LIABILITIES | 1,480,076 | 1,078,520 | 37.2% | |||
Trade accounts payable | 8,741 | 11,361 | -23.1% | |||
Loans and financing | 25,707 | 62,872 | -59.1% | |||
Suppliers | 1,056,721 | 691,022 | 52.9% | |||
Salaries and related charges | 22,685 | 20,842 | 8.8% | |||
Taxes, charges and contributions | 157,666 | 153,563 | 2.7% | |||
Related parties | 45,042 | 2,944 | 1430.0% | |||
Payable dividends and interest on shareholders' equity | 141,606 | 114,678 | 23.5% | |||
Other | 21,909 | 21,239 | 3.2% | |||
NON CURRENT LIABILITIES | 159,043 | 103,524 | 53.6% | |||
Loans and financing | 105,076 | 41,220 | 154.9% | |||
Trade accounts payable | 2,962 | - | N.A. | |||
Taxes, charges and contributions | 4,634 | 26,005 | -82.2% | |||
Provision for contingencies | 42,788 | 32,602 | 31.2% | |||
Supplementary pension plan | 3,584 | 3,697 | -3.1% | |||
MINORITY INTEREST | - | 393,605 | N.A. | |||
SHAREHOLDERS' EQUITY | 2,745,942 | 2,020,507 | 35.9% | |||
Capital | 1,472,075 | 884,504 | 66.4% | |||
Reserva de capital | 192,081 | 240,634 | -20.2% | |||
Income reserves | 647,298 | 695,472 | -6.9% | |||
Net Profit | 434,489 | 199,897 | 117.4% | |||
The complete Financial Statement, including its Explanatory Notes is available on the Website: www.timpartri.com.br
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Attachment 2
TIM PARTICIPAÇÕES S.A.
Results (BR GAAP R$ Thousands)
DESCRIPTION | 4Q05 | 4Q04 | % | 2005 | 2004 | YTD % | ||||||
Gross Revenues | 1,073,224 | 1,001,586 | 7.2% | 3,903,272 | 3,429,175 | 13.8% | ||||||
Telecommunications Services | 855,538 | 773,012 | 10.7% | 3,169,743 | 2,782,403 | 13.9% | ||||||
Core | 789,578 | 732,092 | 7.9% | 2,950,778 | 2,664,006 | 10.8% | ||||||
VAS | 65,960 | 40,920 | 61.2% | 218,965 | 118,396 | 84.9% | ||||||
Handset sales and other revenues | 217,686 | 228,574 | -4.8% | 733,530 | 646,772 | 13.4% | ||||||
Handset Sales | 217,686 | 228,574 | -4.8% | 733,530 | 646,772 | 13.4% | ||||||
Discounts and deductions | (269,541) | (253,883) | 6.2% | (985,057) | (864,543) | 13.9% | ||||||
Taxes and discounts on services | (198,945) | (182,414) | 9.1% | (739,054) | (661,676) | 11.7% | ||||||
Taxes and discounts on handset sales | (70,597) | (71,469) | -1.2% | (246,002) | (202,867) | 21.3% | ||||||
Net Revenues | 803,683 | 747,703 | 7.5% | 2,918,216 | 2,564,632 | 13.8% | ||||||
Services | 656,593 | 590,598 | 11.2% | 2,430,688 | 2,120,727 | 14.6% | ||||||
Handset and other revenues | 147,090 | 157,105 | -6.4% | 487,528 | 443,905 | 9.8% | ||||||
Operating Expenses | (505,485) | (486,888) | 3.8% | (1,905,029) | (1,678,386) | 13.5% | ||||||
Personal expenses | (33,120) | (31,051) | 6.7% | (125,164) | (115,658) | 8.2% | ||||||
Selling & marketing expenses | (167,802) | (137,449) | 22.1% | (564,419) | (433,418) | 30.2% | ||||||
Network & interconnection | (101,275) | (102,287) | -1.0% | (435,883) | (410,057) | 6.3% | ||||||
G&A | (25,366) | (21,449) | 18.3% | (110,680) | (104,960) | 5.4% | ||||||
Cost Of Goods and Service | (147,682) | (162,776) | -9.3% | (536,470) | (513,662) | 4.4% | ||||||
Bad Debt | (27,753) | (30,148) | -7.9% | (117,978) | (112,605) | 4.8% | ||||||
Other operational revenues (expenses) | (2,487) | (1,728) | 44.0% | (14,434) | 11,976 | N.A. | ||||||
EBITDA | 298,198 | 260,815 | 14.3% | 1,013,187 | 886,246 | 14.3% | ||||||
EBITDA - Margin over total net revenues | 37.1% | 34.9% | 2.2 p.p | 34.7% | 34.6% | 0.1 p.p | ||||||
Depreciation | (97,637) | (107,681) | -9.3% | (377,524) | (361,950) | 4.3% | ||||||
Amortization | (41,005) | (36,205) | 13.3% | (154,832) | (136,191) | 13.7% | ||||||
EBIT | 159,556 | 116,929 | 36.5% | 480,832 | 388,105 | 23.9% | ||||||
EBIT - Margin over total net revenues | 19.9% | 15.6% | 4.3 p.p | 16.5% | 15.1% | 1.4 p.p | ||||||
Other non-operational revenues (expenses) | (428) | (399) | 7.2% | (2,260) | (4,592) | -50.8% | ||||||
Net Financial Results | 18,771 | 11,257 | 66.8% | 72,431 | 60,571 | 19.6% | ||||||
Financial expenses | (29,944) | (21,738) | 37.8% | (83,634) | (68,801) | 21.6% | ||||||
Net exchange variance | (394) | (1,231) | -68.0% | (2,482) | (4,241) | -41.5% | ||||||
Financial income | 49,110 | 34,225 | 43.5% | 158,546 | 133,613 | 18.7% | ||||||
Net income before taxes and Minorities | 177,900 | 127,787 | 39.2% | 551,002 | 444,084 | 24.1% | ||||||
Income tax and social contribution | (32,866) | (20,876) | 57.4% | (130,338) | (108,036) | 20.6% | ||||||
Minority interest | - | (23,539) | N.A. | (21,464) | (70,113) | -69.4% | ||||||
Net Income | 145,034 | 83,372 | 74.0% | 399,200 | 265,935 | 50.1% | ||||||
The complete Financial Statement, including its Explanatory Notes are available on the Website: www.timpartri.com.br
13
Attachment 3
TIM PARTICIPAÇÕES S.A.
Cash Flow Statements
(BR GAAP R$ Thousands)
2005 | 2004 | 4Q05 | 4Q04 | |||||
EBIT | 480,832 | 388,105 | 159,556 | 116,929 | ||||
Depreciation and Amortization | 532,357 | 498,142 | 138,641 | 143,885 | ||||
Capital Expenditures | (684,474) | (674,493) | (348,359) | (309,551) | ||||
Changes in Net Operating Working Capital | 215,806 | 92,715 | 422,088 | 208,419 | ||||
Provisions for Contingencies | 10,186 | 11,124 | 15,267 | 8,343 | ||||
Free operating cash flow | 554,707 | 315,592 | 387,193 | 168,026 | ||||
Income and Social Contribution Taxes | (130,338) | (108,036) | (32,866) | (20,876) | ||||
Dividends and Interest on Own Capital | (92,885) | (65,346) | - | - | ||||
Loans and Financing | 23,642 | (72,917) | (4,885) | 397 | ||||
Net Financial Income | 72,431 | 60,571 | 18,771 | 11,257 | ||||
Other changes | (28,812) | 28,425 | 36,790 | 38,486 | ||||
Net Cash Flow | 398,745 | 158,289 | 405,003 | 197,290 |
The complete Financial Statement, including its Explanatory Notes is available on the Website: www.timpartri.com.br
14
Attachment 4
Operational Indicators for the Northeastern Region
4T05 | 4T04 | Var. % | 3T05 | Var.% | 2005 | 2004 | Var. % | |||||||||
Tri | Ano | Ano | ||||||||||||||
Estimated Population in the Region (million) | 28.9 | 28.6 | 0.3% | 28.8 | 1.0% | 28.9 | 28.6 | 1.0% | ||||||||
Municipalities Served - GSM | 342 | 308 | 4.0% | 329 | 11.0% | 342 | 308 | 11.0% | ||||||||
Estimated Total Penetration | 34.2% | 23.0% | 2.9 p.p. | 31.3% | 11.2 p.p. | 34.2% | 23.0% | 11.2 p.p. | ||||||||
Market Share | 37.0% | 39.9% | -0.2 p.p. | 37.2% | -2.9 p.p. | 37.0% | 39.9% | -2.9 p.p. | ||||||||
Total Lines | 3,657,046 | 2,666,346 | 9.2% | 3,349,016 | 37.2% | 3,657,046 | 2,666,346 | 37.2% | ||||||||
Prepaid | 2,934,700 | 1,975,342 | 10.4% | 2,659,202 | 48.6% | 2,934,700 | 1,975,342 | 48.6% | ||||||||
Postpaid | 722,346 | 691,004 | 4.7% | 689,814 | 4.5% | 722,346 | 691,004 | 4.5% | ||||||||
Gross Additions | 463,575 | 338,393 | 1.5% | 456,542 | 37.0% | 1,585,278 | 997,756 | 58.9% | ||||||||
Net Additions | 308,030 | 134,352 | 8.9% | 282,968 | 129.3% | 990,700 | 493,821 | 100.6% | ||||||||
Churn | 4.6% | 7.9% | -1.0 p.p | 5.6% | -3.3 p.p | 19.9% | 21.0% | -1.2 p.p | ||||||||
TOTAL ARPU * | R$27.31 | R$34.33 | 5.6% | R$25.86 | -20.4% | R$27.73 | R$33.72 | -17.8% | ||||||||
TOTAL MOU | 92 | 91 | 8.7% | 85 | 1.2% | 91 | 96 | -5.8% | ||||||||
Investment (R$ million) | 179.7 | 161.1 | 133.1% | 77.1 | 11.6% | 327.0 | 306.9 | 6.6% | ||||||||
Employees | 1,190 | 1,046 | 8.5% | 1,097 | 13.8% | 1,190 | 1,046 | 13.8% | ||||||||
Attachment 5
Operational Indicators for the Southern Region
4Q05 | 4Q04 | Var. % | 3Q05 | Var.% | 2005 | 2004 | Var. % | |||||||||
Q-o-Q | Y-o-Y | Y-o-Y | ||||||||||||||
Estimated Population in the Region (million) | 15.9 | 15.8 | 0.2% | 15.9 | 0.9% | 15.9 | 15.8 | 0.9% | ||||||||
Municipalities Served - GSM | 320 | 297 | 6.3% | 301 | 7.7% | 320 | 297 | 7.7% | ||||||||
Estimated Total Penetration | 52.7% | 39.0% | 3.8 p.p. | 48.9% | 13.7 p.p. | 52.7% | 39.0% | 13.7 p.p. | ||||||||
Market Share | 45.8% | 47.9% | -0.3 p.p. | 46.1% | -2.1 p.p. | 45.8% | 47.9% | -2.1 p.p. | ||||||||
Total Lines | 3,856,285 | 2,990,252 | 7.3% | 3,594,297 | 29.0% | 3,856,285 | 2,990,252 | 29.0% | ||||||||
Prepaid | 3,050,471 | 2,343,881 | 7.6% | 2,834,016 | 30.1% | 3,050,471 | 2,343,881 | 30.1% | ||||||||
Postpaid | 805,814 | 646,371 | 6.0% | 760,281 | 24.7% | 805,814 | 646,371 | 24.7% | ||||||||
Gross Additions | 450,277 | 518,878 | 8.3% | 415,600 | -13.2% | 1,650,914 | 1,516,450 | 8.9% | ||||||||
Net Additions | 261,988 | 361,344 | 53.9% | 170,263 | -27.5% | 866,033 | 934,368 | -7.3% | ||||||||
Churn | 5.2% | 5.6% | -1.9 p.p | 7.1% | -0.4 p.p | 23.7% | 24.0% | -0.3 p.p | ||||||||
TOTAL ARPU * | R$29.85 | R$35.82 | 0.6% | R$29.69 | -16.7% | R$30.82 | R$36.33 | -15.2% | ||||||||
TOTAL MOU | 77 | 77 | 6.8% | 72 | 0.3% | 76 | 83 | -8.9% | ||||||||
Investment (R$ million) | 168.6 | 147.8 | 138.0% | 70.9 | 14.1% | 357.4 | 367.9 | -2.9% | ||||||||
Employees | 1,256 | 1,143 | 1.0% | 1,244 | 9.9% | 1,256 | 1,143 | 9.9% | ||||||||
Attachment 6
Operational Indicators Consolidated Data TIM Participações S.A.
4Q05 | 4Q04 | Var. % | 3Q05 | Var.% | 2005 | 2004 | Var. % | |||||||||
Q-o-Q | Y-o-Y | Y-o-Y | ||||||||||||||
Estimated Population in the Region (million) | 44.9 | 44.4 | 0.2% | 44.8 | 1.1% | 44.9 | 44.4 | 1.1% | ||||||||
Municipalities Served - GSM | 662 | 599 | 5.1% | 630 | 10.5% | 662 | 599 | 10.5% | ||||||||
Estimated Total Penetration | 40.8% | 29.0% | 3.2 p.p. | 37.6% | 11.8 p.p. | 40.8% | 29.0% | 11.8 p.p. | ||||||||
Market Share | 41.1% | 43.8% | -0.2 p.p. | 41.3% | -2.7 p.p. | 41.1% | 43.8% | -2.7 p.p. | ||||||||
Total Lines | 7,513,331 | 5,656,598 | 8.2% | 6,943,313 | 32.8% | 7,513,331 | 5,656,598 | 32.8% | ||||||||
Prepaid | 5,985,171 | 4,319,223 | 9.0% | 5,493,218 | 38.6% | 5,985,171 | 4,319,223 | 38.6% | ||||||||
Postpaid | 1,528,160 | 1,337,375 | 5.4% | 1,450,095 | 14.3% | 1,528,160 | 1,337,375 | 14.3% | ||||||||
Gross Additions | 913,852 | 857,271 | 4.8% | 872,142 | 6.6% | 3,236,192 | 2,514,206 | 28.7% | ||||||||
Net Additions | 570,018 | 495,696 | 25.8% | 453,231 | 15.0% | 1,856,733 | 1,428,189 | 30.0% | ||||||||
Churn | 4.9% | 6.7% | -1.5 p.p | 6.4% | -1.8 p.p | 21.9% | 22.5% | -0.6 p.p | ||||||||
TOTAL ARPU * | R$30.67 | R$36.61 | 0.9% | R$30.40 | -16.2% | R$31.34 | R$36.53 | -14.2% | ||||||||
TOTAL MOU | 84 | 84 | 7.9% | 78 | 0.5% | 83 | 90 | -7.6% | ||||||||
Investment (R$ million) | 348.4 | 308.9 | 135.5% | 147.9 | 12.8% | 684.5 | 674.9 | 1.4% | ||||||||
Employees | 2,446 | 2,189 | 4.5% | 2,341 | 11.7% | 2,446 | 2,189 | 11.7% | ||||||||
15
Attachment 7
Glossary
Financial Terms EBIT = Earnings before interest and tax EBITDA = Earnings before interest, tax, depreciation and amortization EBITDA Margin = EBITDA/ Net Operating Revenue CAPEX (capital expenditure) capital investment Subsidy = (net revenue from goods cost of sales + vendors discounts) / gross additions Net debt = gross debt cash PL Shareholders Equity Technology and Services TDMA = Time Division Multiple Access GSM = Global System for Mobile Communications A system storing and coding cell phone data, such as user calls and data, enabling a user to be recognized anywhere in the country by the GSM network. The GSM is now the standard most used in the world. EDGE = Enhanced Data rates for Global Evolution A technique developed to increase the speed of data transmission via cell phone, creating a real broadband for handsets with the GSM technology. available offer speeds that can depending on the handset model. SMS = Short Message Service ability to send and receive alphanumerical messages. |
Operating indicators Customers = Number of wireless lines in service Gross additions = Total of customers acquired in the period Net additions = Gross Additions number of customers disconnected Market share = Companys total number of customers / number of customers in its operating area Marginal Market share = participation of estimated net additions in the operating area. Market penetration = Companys total number of customers + estimated number of customers of competitors / each 100 inhabitants in the Companys operating area Churn rate = number of customers disconnected in the period ARPU = Average Revenue per User net monthly revenue per customers in the period Blended ARPU = ARPU of the total customer base (contract + prepaid) Contract ARPU = ARPU of contract service customers Prepaid ARPU = ARPU of prepaid service customers MOU = minutes of use monthly average. in minutes of traffic per customer = (Total number of outgoing minutes + incoming minutes) / monthly average of customers in the period Contract MOU = MOU of contract service customers Prepaid MOU = MOU of prepaid service customers SAC = Customer acquisition cost = (marketing expenses + commission + Fistel + comodato + costs of retention) |
16
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
TIM PARTICIPAÇÕES S.A. | ||
Date: February 01, 2006 | By: | /s/ Paulo Roberto Cruz Cozza |
Name: Paulo Roberto Cruz Cozza | ||
Title: Chief Financial Officer |