Entel Chile

Entel ChileDeutsche Bank TelecommunicationConferenceSao Paulo, BrazilApril 10, 2012

Telecom Industry: Chile subscribers trends25201510Services in Chile(in million)During 2012, MBB willreach FBBMobile VoiceFixed VoiceMBBPenetration20106% 93%8%CAGR 08-11 CAGR 11-14116% 12% 4%76% 6%70% 0% 0%70%-1%27% 35%50FBBPay TV39% 13% 12%28%11%7,0%39% 13% 13%13%67%27%Local trends are in line with worldwide trends:• MBB leading growth in the industry, accompanied by FBB and Pay TV• Mobile Voice continues growing at lower ratesSource: Entel44/5/2012

Entel also provides transportation capacity via global consortiumsFiber Optic and SatellitesLos AngelesNueva YorkOJUS MiamiNAP MiamiENTEL Bolivia(1 STM-1)Río de JaneiroLimaSantiago104/5/2012

Entel is progressing forward in Social ResponsibilityThird publication ofbiannual SustainabilityReport prepared underthe Global ReportingInitiative (GRI)Entel Group maintainscommitment to UnitedNations GlobalCompact …Social Responsibilityis an essential partof Entel’s corporatemanagement…... In order to ensurelong termsustainability,contributing to thedevelopmentand welfare of society.... Voluntarily manifestingthe ability to listen,understand and meet theexpectations andinterests of theCompany’s stakeholders...Entel services andproducts play a centralrole under CSRframework, encouragingacademic excellence andimprovements in qualityof lifeSecond Phase of “Todo ChileComunicado” was deployed:as of to date it includes theconnection of 1,000 new ruralvillages along the countrywith mobile broadband,benefiting 2.7 milloninhabitants. The total projectreaches 1,400 rural areas and3.0 million people.114/5/2012

Entel shares are traded in the Chilean stock marketHighlightsEntel´s Ownership – Strong and experienced• Listed on Santiago stock exchange.• Market cap 1 : US$ 4.9 billion.• Daily average trading volume 2 : US$ 5.7million.All Others36.6%Altel InversionesLtda.54.8%Pension Funds8.6%1: Exchange rate 483.78 Ch$/1 US$.- Stock price as of April 5, 2012.2: Average from March 2010 to February 2012.As of March 30, 20123: Altel is a wholly-owned subsidiary of Almendral (Holding Company) andits main controllers are Matte, Fernandez/Hurtado, Izquierdoand Gianoli Economic Groups.Entel´s corporate governance at high standards.• Board of Directors composed by 9 members• Procedure related to market disclosure ofinformation.• Controlling parties appoint 7members• 2 members are independents.• Board Committee composed by 3 Directors• Release of relevant information in company´swebsite.• Adoption of Ethic Code .• 2 members are independent.124/5/2012

Corporate structureMain Operating Companies (Year 2011)Total Revenue: USD 2.390 MM (*)Total EBITDA: USD 992 MMMobile BusinessChileWirelineAmericatel PerúRevenue: USD 1.905 MEBITDA: USD 763 MRevenue: USD 610 MEBITDA: USD 220 MRevenue: USD 43 MEBITDA: USD 4 MVoice, Data & MobileBroadBandLocal TelephonyInternetData services including ITLong DistanceInfraestructure Rentals andWholesaleCall CenterRevenue: USD 51 MEBITDA: USD 5 M*Net of intercompanies revenuesValues divided by $519.2134/5/2012

Business Segments144/5/2012

Mobile154/5/2012

Revenue (US$ bn)Ingresos (US$ bn)Revenue (US$ bn)Ingresos (US$ bn)Mobile industry worldwide trends: Voice - DataVoz voice1200Total Mobile Revenues (data vs voice)Ingresos Globales (Datos/voz)2008 2008-2013 - 2013Datos dataTotal Data Revenues (Broadband vs others)Ingresos Globales (Broadband/Non Broadband)2008 - 20132008-2013Non Broadband Broadband100080060040020002008 2009 2010 2011 2012 20133002502001501005002008 2009 2010 2011 2012 2013Total Mobile Revenues (voice and data), 2008 - 2013 Voice services declining inrevenue share.Relevant increases in mobilebroadband share.Within data, also Mobile Internet(chat, browsing, digital TV andradio) and emails are growingrapidly.Source: Informa Telecoms and Media164/5/2012

Global TrendsTablets and Smartphones140Shipments by type of Equipment (U.S.A.)120100806040TabletsNetbooksNotebooksDesktop20-2009 2010 2011 2012 2013 2014• iPad corresponds to 6% of portable computer equipment sales in USA (2Q10)• It is expected that by 2012 “Pads” exceeds Netbooks market (Canalys July2010)• In 2014, smartphones will represent almost 40% of mobile equipment sales.Source: (Forrester and IDC March 2010)17

Entel has a strong position in the mobile industryMobile Overview• 60 MHz in the 1,900 MHz band / GSM technology. 3.5G nationwide.First commercial HSPA+Dual Carrier network in LATAM.• Penetration at 137% in Chile, including mobile broadband• Strong market share at 40%, leading position in high value segments.• Market growth driven by mobile broadband and innovative VAS(Internet mobile and e-mail).• Competitive environment, with mobile number portability and newentrants expected in 2012.Strategic Focus• Create value, sustained in top global service and best in classnetwork.• Revenue growth focused on value-added services, especially mobilebroadband and mobile Internet.• Adapt business processes to Fixed and Mobile convergence.• Expand VAS and MBB penetration, via flexible offerings (especiallynew enterprise M2M applications and smartphones).Entel’s Mobile Subscribers (in Thousands)6,0011261,6616,4572481,7694,214 4,4417,5685511,6055,00424%9452,3416,0612008 2009 2010 2011Prepaid Postpaid MBB9,347Market Share as of December 2011**• Strategic alliances with technology providers and commercialpartnership. • (*) Nextel Market Share: 0.14%• (**) Market Share measure over active customers• Source: EntelMovistar39%16%Claro21%Nextel0%Cagr 08 / 11Growth 10/11Entel40%184/5/2012

Value added services and 3.5G growing at high ratesValue Added Services Revenues *(US$ Millions)41%41%Cagr 08 / 11Growth 10/114012851921422008 2009 2010 2011* Including Mobile Broadband and datacards (as of December 2011 945 th. customers)-2008 / 2011 values divided by $519.20VAS / Outgoing Revenues(%)10%12% 13%16%19%25%29%1998 a 20112005 2006 2007 2008 2009 2010 2011SMSGPRSXAT (SMS)WAPSMS PremiumMMSEDGEEDGE nationwideVideo StreamingPTTBlackberry3.5 GIn main cities3.5 GNationwideHSPA+NationwideHSPA+ DualCarriermain cities194/5/2012

Profitable client baseMobile Revenues (US$mm)-2008 / 2011 values divided by $519.20Mobile EBITDA and EBITDA Margin (US$mm, %)8%16%7%19%7631,9056185866441,493 1,4441,64742%41% 39% 40%2008 2009 2010 20112009 figures impacted by 45% drop in access chargesBlended ARPU 1 (US$)2008 2009 2010 2011MOU 2 (Minutes/month)Cagr 08 / 11Growth 10/11-4%19.818.2 18.217.65%-1%197 1941661822008 2009 2010 20112008 2009 2010 20111.Average Revenue per User2Minutes of usage.204/5/2012

The Wireline Business - Chile214/5/2012

Chile wireline offers integrated solutions focused onthe enterprise segmentRevenue distribution per segment – Year 2011Corporate and SME * Services to Other TelecomResidential *Companies *Local Telephony25%IT Services22%Long Distance and valueadded services9%Internet9%Data services35%TrafficBusiness24%NetworkRentals76%Internet4%Local Telephony15%Long Distanceand value addedservices81%US$ 316 millionUS$ 254 millionUS$ 40 million* Includes intercompany RevenuesValues divided by $519.20.224/5/2012

Corporate and SME segments: leading position,consolidating IT servicesOverview• Leading position and expertise in traditional dataservices (42% market share), growing through theintegration of IT services.• Market trends: integrated offerings includingIT/telco; convergence of Fixed & Mobile; bundledsolutions over IP networks.•Ciudad de Los Valles is interconnectedto the network of six data centers.•Deliver wide range of IT Services;•Cloud Computing Services•On- demand solutions•Dedicated virtual servers•On-demand hosting and storage services• Standardized service offering for all companiesbased on cloud computing.Corporate Strategic Focus• Continue leading traditional Telco market (integrated voice,data and Internet).• Grow market share in IT (O/S, data center, virtual servicesand on-demand services).• Strengthen service model for Fixed & Mobile convergence.SME Strategic Focus• Increase market share.• Increase coverage and capacity by deploying networkfiber optic (GPON) access.• Provide IT services aligned with SME requirements(virtual infrastructure and on-demand services);working in development of fixed & mobileconvergence.234/5/2012

Services to other telecom companies: Optimization ofnetwork usageOverview• Leading network infraestructure provider to othertelecom operators and related companies.• Service provided to Intercompany businessrepresents more than 75% of Network Rentals.2010 RevenuesTrafficBusiness24%US$ 62 mmUS$ 192 mm• Cost-effective provider of Traffic desk, managingcredit risk in high volumes related to Wholesale,Incoming Traffic and Value Added Services.Note: Includes Intercompany RevenuesNetworkRentals76%Strategic Focus• Provide quality service of rental network capacity to related companies and other operators.• Leverage current network capacity.• Traffic routing optimization to assure low tariff for LD. Focus on low risk customers.IFRS values divided by $519.20.244/5/2012

Chile´s Wireline Business reporting solid growthChile Wireline EBITDA and EBITDA Margen(US$ millions)Cagr 08 / 11Growth 10/1124015%5%80%16014618421022050%80034%38% 36%28%2008 2009 2010 201120%EBITDAEBITDA Margin• Strategy focused in the enterprise segment.-2008 / 2011 Values divided by $519.20254/5/2012

Americatel Perú264/5/2012

Americatel PerúOverview• Continuous growth in datacom and local telephonyservices in the enterprise segment in the Lima Area.Recently adding IT services.Revenues (US$ millions)Cagr 08 / 11Growth 10/11• Growing data-IP services over WiMax, focused on theenterprise segment.• Long distance services have decreased, mainly due toregulatory changes.Strategic Focus• Change in revenue mix, increasing services overAmericatel´s own access network in Lima (WiMax,copper) and IT, leveraging Chile experience.3%40 39 398%43• Harvest along the mature LD business.2008 2009 2010 2011Revenue Mix 2008 – 2011: Changing to services provided over own access networkData,LocalTelephony& NGN31%Wholesale25%LD44%Data, Local Telephony &NGN50%LD24%Wholesale26%20082011274/5/2012

Financial Overview284/5/2012

Returning to high growthConsolidated Figures (US$ MM )EBITDA and EBITDA MarginRevenuesCagr 08 / 11Growth 10/117%1,939 1,9162,09214%2,3909%769 77385916%99240% 40%41%42%2008 2009 2010 2011Operating IncomeNet Income2008 2009 2010 20117%378 35640114%4599%5%268 274333 3482008 2009 2010 20112008 2009 2010 2011-2008 / 2011 Values divided by $519.20294/5/2012

CAPEX mostly driven by Mobile ExpansionCAPEX Strategy• Keep tech. / quality edge in mobile,managing growth and providing broadbandsolutions.2011 CAPEX BreakdownTotal = US$ 733.5 million(including postpaid handsets around US$ 230 million)• Minimum investments in mature services.• Mobile (including postpaid handsets)accounts 70% of CAPEX.• Bulk of investment driven by demand.Data / TI17%All Others13%Mobile handsets32%Mobile38%Historical CAPEX * - Excluding postpaid handsets(US$ in Millions)CAPEX / Revenues360 33839650219%20%19% 18%19% 19%16%2008 2009 2010*Average Exchange rate of each year.304/5/2012

Strong cash flow in line with mobile expansionCash Flow *(US$ Millions)Cagr 08 / 11Growth 10/11244 2516%3%281 2882008 2009 2010 2011* Cash Flow is defined as: EBITDA - Capex - Net financial expenses--2008 / 2011 Values divided by $519.20.314/5/2012

Liquidity and debt ratios reflects the company’s healthyfinancial position…2008 2009 2010 2011Current Ratio 1.2 1.1 1.0 0.9EBITDA/Financial expenses 26.2 35.4 45.1 49.9Gross Financial Debt/EBITDA 1.0 0.8 0.7 0.6Total liabilities /(Equity+ Minority interest) 1.2 1.1 1.1 1.0Net financial debt (US$ Million) 637 658 544 651Net financial Expenses (US$ Million) 24 20 16 14• Fully hedged to F/X exposure.• 43% of debt is at fixed rate.• Moody’s rating: Baa1, S&P rating: BBB+ (both with stable outlooks)• Dividend policy: Up to 80% of Net Income.-2008 / 2011 Values divided by $519.20324/5/2012

… with a comfortable debt payment scheduleMaturities(US$ Millions)4042044122012 2013 2014 2015+Leasing BankTotal gross debt = US$ 624 million as of December, 2011.‣2012 maturities were refinanced during December 2011, which considers the payment of interestquarterly or semiannually and a single repayment in December 2014.334/5/2012

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Thank You !Investor Relationscdelacerda@entel.clAndres Bello 2687– Las Condes – Santiago_Chile354/5/2012