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									      Presentation at the

ABN AMRO Investors Conference

     November 08th , 2004




                                www.telemar.com.br/ir
   Telemar Presentation - Contents




                             1. Telemar Overview                  1



                             2. Brazilian Telecom Market         5



                             3. Operating and Financial Review   11




ABN AMRO Investors Conference / November 2004                         www.telemar.com.br/ir   1
   Shareholder Structure – TNE

       BNDESPar - 25%
       Fiago – 19.9%
       AG Telecom – 10.28%
                                                         Telemar
       ASSECA Participações – 10.27%
       Lexpart Part. – 10.28%
                                                    Participações S.A.
       L.F. Tel - 10.27%
                                                                  18.9%
       BrasilCap - 5%
       Brasil Veículos - 5%                           Tele Norte Leste
                                                                                   Total Shares: 387.9 million
                                                     Participações S.A.
       Fundação SISTEL - 4%                                                        Free Float 79.5% / Treasury 1.6%
                                                           •(TNL)
                                                           (TNL)



                                            80.9%
                                                                                        100%
Total Shares: 241.7 million                            Fixed line
Free Float 18.7% / Treasury 0.4%                                                                  Contact Center



                                    100%                   100%


                           Mobile                                   Data Transmission




ABN AMRO Investors Conference / November 2004                                                  www.telemar.com.br/ir   2
   Telemar History
   1998                                                                             2002
                                                                                                         International




                                                                                                               RI
                                                                                                   RII

                                                                                                                    RIII




     Processes
                                                                                           Management/Processes/IT
     16 Companies                                                                                                All Unified
     16 IT Systems
     60 Network Platforms                                                                                        Services
     50 Network Management Centers                 Restructuring 16  1
     116 Call Centers                                                                              Local & Advanced Voice
                                                - Optimization of Resources;                   Domestic & International LD
                                                - Process Standardization;                   Nationwide Data Transmission
    Services                                                                                                        Mobile
                                                - Management Centralization;
     Local Voice and regional LD;                                                                              Call Center
                                                - Merger of fixed line companies;           Network Management / Internet
     Regional Data Communic.

                                                                                                          Market Vision
   Market Approach
                                                                                                  Customer Segmentation
    Geographic
ABN AMRO Investors Conference / November 2004                                                      www.telemar.com.br/ir       3
   Highlights

                                           Region I
                                           = Concession area
                                                                   Target: Develop a fully integrated
                                           for Wireline services     telecom service provider
                                           = Mobile license
                                           for Wireless services    Change, adaptation and consolidation
                                                                         Market share gains
                                                                         Selective growth (New Services)
                                                                         Consolidation of investments
                                                                    Growth in highly competitive markets:
                                                                         Long Distance (Nationwide and
                                                                          International)
         Nationwide                                                      Data & Corporate (Nationwide)
         = Authorization area                                            PCS Mobile (Region I – GSM)
         for Long-Distance                                          Exploring new opportunities:
         and Data services
                                                                         Broadband (ADSL)
                                                                         Bundled Services
                                                                         New Products (residential/SME)
                                                                         Segmented offer (mobile services)


                                                                   Goal: Ensure a sound financial position,
                                                                     with increasing returns to investors.


ABN AMRO Investors Conference / November 2004                                              www.telemar.com.br/ir   4
   Telemar Presentation - Contents




                             1. Telemar Overview                 1



                             2. Brazilian Telecom Market         5



                             3. Operating and Financial Review   11




ABN AMRO Investors Conference / November 2004                         www.telemar.com.br/ir   5
   Brazilian Telecom Market – Customer Base (in millions)

                                         Fixed Line                                                     Mobile

                                                                                                                                   33
                                                                                                                                        Brazil
                          Penetration          23     23
                                                            23                            Penetration
                           Rate (%)      21                       Brazil                                                  26
                                                                                           Rate (%)
                                 18
                                                                                                               20
                     14
                                                                                                        17                          58
             11                                              39
                                               39     39                                       14
                                          37                                                                                 46
                                    31                                              9
                          25                                                                                       35
                                                                            5
               20                                                                                        29
                                                                                                   23
                                                                                         15
                                                                                7


               981        99        00    01   02     03   Jun/04
                                                                           981      99        00        01    02        03        Sep/04




             After doubling in size after privatization                    Brazilian subscriber base still growing
               in 1998, further growth of fixed-line                        at over 30% p.a., with further room to
               platform more closely linked to the                          increase penetration levels.
               performance of Brazilian economy.

        1   Privatization.


ABN AMRO Investors Conference / November 2004                                                                           www.telemar.com.br/ir    6
   Fixed Line Sector in Brazil – June/2004
                                                                  1998      2001       2002        2003     Jun/04
                                         LIS (million)*           20.0      37.4           38.8    39.2         39.3



                                             Telemar                                Brasil Telecom
                                                             Region I                                     Region II




                                                                                                                        Fixed Lines in Service: 37 m
                                            15.2 M          32%                            9.6 M          20%          (Main Incumbents)

                                                                                                                       % of Total Gross Revenue:
                                        Telefonica                                  Embratel (LD Carrier)              T= R$ 29.1 bn / 1H04
                                                            Region III                                Region IV




                                               12.2 M         31%                                     17%


   * Includes smaller incumbents and mirror companies (CTBC, Vesper, GVT and Sercomtel).


ABN AMRO Investors Conference / November 2004                                                                           www.telemar.com.br/ir          7
   Mobile Subscribers in Brazil - Sep/2004


                     Vivo – TEL/PT (CDMA)                          Claro - AMX (TDMA/GSM)           TIM (TDMA/GSM)




                         24.6 m          42%                           12.0 m   21%                   11.7 m        20%



                                            Oi - Telemar (100% GSM)               Opportunity & BRT (TDMA/GSM)*

                                                                                                                           Subscriber Base -
                                                                                                                           Brazil: 58 m


                                                                                                                            Market Share




                                                5.7 m**          10%                        4.0 m    7%


    * Other groups with 0.2 m subscribers (~0.3% market share)
    ** Oi announced 6 million subs in Oct/04.

   Source: Company´s Information
ABN AMRO Investors Conference / November 2004                                                                     www.telemar.com.br/ir        8
   Brazilian Telecom Market - Penetration Figures




                     Fixed: 39 m (Jun/04)                   23%
                     Mobile: 58 m (Sep/04)                  33%
                                                                                              Mobile penetration still has a lot of room
                                                                                              to grow, helped by economic recovery;
       70



                                                                          58%                 Anatel estimates between 62.8 / 69.8 m
       60
                                                                                              subs by 2004YE;

       50
                                             Max.
                                                                          42%                 Estimated mobile penetration for 2008YE
       40
                                                    Min.                                      ranges from 42% to 58%;


       30
                   Mobile*                                        Fixed Line** 23%
                                                                                              Fixed line penetration should be more or
                                                                                              less stable, following GDP growth.
       20
              02               03      04E     05E         06E    07E     08E




   * Estimates from: Citigroup, Goldman Sachs, JP Morgan, Merryll Lynch, Pyramid Research.
   ** Estimates from Yankee Group




ABN AMRO Investors Conference / November 2004                                                                        www.telemar.com.br/ir   9
   Brazilian Telecom Market - Broadband

                 Broadband Access – ( thousands)

                                                                       3,831
                                                               3,547
                                                       3,148
                                               2,591

                                       1,874                                   ADSL
                                                                                       ADSL has become the dominant
                               1,199                                                   technology in Brazil (over 80% market
                         694                                                           share);
                  326
         130
         00      01     02      03     04E     05E     06E     07E     08E
                                                                                       Broadband subscriber base expected
                                                                                       to increase by 2.5x through 2008 (from
                                                                                       1.5 m in Jun/04);
                PC Penetration (% of households)
                                                                                       Telemar has a target to increase
                                                                                       broadband penetration from 2.8% of
                                                                                       fixed lines in service to 5% by 2006.




                          2003

    Source: Anatel / Teleco / Pyramid Research estimates*

ABN AMRO Investors Conference / November 2004                                                                 www.telemar.com.br/ir   10
   Telemar Presentation - Contents




                             1. Telemar Overview                 1



                             2. Brazilian Telecom Market         5



                             3. Operating and Financial Review   11




ABN AMRO Investors Conference / November 2004                         www.telemar.com.br/ir   11
   Operating and Financial Highlights




                              Operating                                        Financial
            Stable fixed-line platform;                           Consistent top line growth;
            Strong   growth        in   mobile   and     ADSL     Mid-40 EBITDA margins;
              subscribers;
                                                                     Low CAPEX required;
            Consistent   market share gains in long
              distance services;                                   Strong cash generation;
            Strong     segmented offer         and   a   large    Execution of deleverage policy;
              distribution network;
                                                                   High dividend yield.
            A state-of-the-art fiber & satellite backbone
              reaching main cities of Brazil, supporting
              voice, data and internet services.




ABN AMRO Investors Conference / November 2004                                              www.telemar.com.br/ir   12
   Growth of Customer Base

                       Fixed Line (million lines)                                                       Mobile (million subs)



                                       15.0   15.1       15.2    ~15.2
                               14.8                                                                                                  ~6.7
                                                                                                                             5.7
                       11.8                                                                                        5.1
                 9.7                                                                                      4.4
                                                                                                 3.9
         7.8
                                                                                       2.8




        1998   1999    2000   2001    2002    2003     Sep_04 2004E                  Sep_03    Dec_03   Mar_04   Jun_04   Sep_04 Dec_04E



                                                                                        ~480
                                                                              429

          ADSL (thousand subs)
                                                                      217


                                                     6      41

                                                2001      2002     2003     Sep_04     2004E




ABN AMRO Investors Conference / November 2004                                                                               www.telemar.com.br/ir   13
   Revenue Growth & Key Drivers

                    Net Revenue Growth – R$ million


                                              14,003
                                                                                             Telemar has been delivering strong
                                    11,874               11,571 +12% yoy                     revenue growth in spite of the
                                                                                             modest performance of Brazilian
                         10,103                                                              economy.




                            Key Revenue Drivers

      New
    Services1
                                                                                             Real growth driven by new segments of
                         24%             31%           37%                                   mobile, data, broadband and long
                                                                                             distance.

    Traditional           76%            69%
     Services2                                           63%
                                                                                             Revenues from traditional services
                                                                                              broadly in line with inflation (no real
                       9M 02          9M 03          9M 04
                                                                                              growth).

    1 Domestic    and International Long Distance, Mobile, Data and Value Added Services.
    2 Local   voice (fixed), network usage and public phones.

ABN AMRO Investors Conference / November 2004                                                                       www.telemar.com.br/ir   14
  EBITDA
     R$ million




                            45%                 44%
                                                      EBITDA Margin


     35%
                                                                               Recurring EBITDA margins stable
                                                                                over time1;
                                            6,221

                           5,353                                               Given strong revenue growth in
                                                                                more competitive segments, we
                                                                                expect a slight reduction in
                                                                      4,939     consolidated EBITDA margin to
          3,558                                               4,645             ~43% in 2004.




        2001             2002            2003                    9M03 9M04    1EBITDA 2001 impacted by non recurring items.




ABN AMRO Investors Conference / November 2004                                                        www.telemar.com.br/ir    15
   Consolidated CAPEX
   R$ billion
                                   10.1



                      Wireless      2.2


                                                                         CAPEX 2003: ~12% of net revenues,
                                                                         compared to 17% in 2002;
                                   7.9

                                                                         CAPEX 9M04: R$ 1,134 million (9.8% of
                                                                         sales);

                            2.8                                          Consolidated CAPEX since 1998: R$ 22
           2.5                                                           billion;
                    2.2                                           2.0
                                           2.0

Wireline
                                           0.9    1.7            40%     Target: Stabilize CAPEX at ~15% of net
                                                  0.6
                                                         1.1             revenues over the next years.
                                                                 60%
                                                  1.1    0.4
                                           1.1
                                                         0.7


       1998       1999    2000    2001    2002   2003   9M04    2004E



                 Anatel Targets and Mobile License (R$1.1 bn)


ABN AMRO Investors Conference / November 2004                                                 www.telemar.com.br/ir   16
   Free Cash Flow after CAPEX
  R$ million
                                                CAGR (99-03)
                                                   69.1%
                                                                                4,025

                                                                        2,302
                                                                                                            3,097
                                                                                        2,487
                492                1,233



                                                                                        9M03             9M04




                                                               -5,906


               1999               2000              2001            2002        2003



            Having met our main fixed line universalization targets and mobile rollout,
            our cash generation is expected to remain strong
ABN AMRO Investors Conference / November 2004                                           www.telemar.com.br/ir       17
   Debt Position
  R$ million
                          Net Debt – Sep/04                      Gross Debt Repayment Schedule – Sep/04

                             R$ 7,000 million                                     R$ 11,863 million

                                                                                    3,519
                     9,121
                                                                           2,863
           7,703                7,834
                                           7,000
                                                      6,300 *

                                                                                            1,550                   1,692

                                                                                                     877     869
                                                                    493



                                                                  4Q04    2005     2006     2007    2008   2009 2010+
        2001       2002      2003     Sep_04       2004E                                                                       % of
                                                                    4.2    24.1     29.7     13.1    7.4     7.3     14.2
                                                                                                                               total
         * To this amount should be included the disbursement
         throughout at the year regarding the Buyback Program.


               Given our strong cash generation, we expect to reduce net debt to less
               than 1x EBITDA by year end 2004


ABN AMRO Investors Conference / November 2004                                                          www.telemar.com.br/ir           18
   Hedge Position (Sep/04)
                 Debt by Currency before Hedging                          Hedging Instruments
                                   Local
                                    33%
                                                                                        Off-Shore 17%
                        Currency                                        Currency
                         Basket                    US$                  swap to
                                                                                           ST Currency Swap 11%
                           5%                      50%                  maturity
                                     Yen                                  72%
                                     12%

                              Total = R$ 10.9 bn

                                                                    Currency Exposure after Hedging




                                                                          Local
                                                                                              USD
                                                                           97%
                                                                                              3%




      1   Excluding inter-company loans



                               Telemar has hedged 95% of its Foreign Currency Exposure
ABN AMRO Investors Conference / November 2004                                           www.telemar.com.br/ir     19
  Key Financial Ratios
                                Net Debt* / EBITDA                Amortization*/ EBITDA (%)




         *EOP
                                                      * Principal and interest
         ** 12 - Month EBITDA

                EBITDA / Net Interest Expense                     Net Debt /Enterprise Value*




                                                     *EOP

ABN AMRO Investors Conference / November 2004                                       www.telemar.com.br/ir   20
   “Safe Harbor” Statement




                  This presentation contains forward-looking
                  statements. Statements that are not
                  historical facts, including statements about   Investor Relations
                  our beliefs and expectations, are forward-     Rua Humberto de Campos, 425 / 8º andar
                  looking statements and involve inherent        Leblon
                  risks and uncertainties. These statements      Rio de Janeiro -RJ
                  are based on current plans, estimates and      Phone: ( 55 21) 3131-1314/1313/1315/1316/1317
                  projections, and therefore you should not      Fax: (55 21) 3131-1155
                  place undue reliance on them. Forward-         E-mail: invest@telemar.com.br
                  looking statements speak only as of the date   Visit our website:
                  they are made, and we undertake no             http://www.telemar.com.br/ir
                  obligation to update publicly any of them in
                  light of new information or future events




ABN AMRO Investors Conference / November 2004                                            www.telemar.com.br/ir   21

								
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