TEO Telecom Argentina SA

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13A-16 OR 15D-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of May 2019

Commission File Number: 001-13464

Telecom Argentina S.A.

(Translation of registrant’s name into English)

Alicia Moreau de Justo, No. 50, 1107

Buenos Aires, Argentina

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

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Telecom Argentina S.A.

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Exhibit

1. Financial information consisting of a free translation of (i) Telecom Argentina’s Operating Financial Review and Prospects as of March 31, 2019, (ii) the Unaudited Consolidated Financial Statements of Telecom Argentina S.A. as of March 31, 2019 and 2018.

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You should carefully review the information contained herein before making an investment decision. We have not authorized anyone to provide information that is different or additional to the information contained in this 6-K. We do not take responsibility for any other information about Telecom or Cablevisión that others may give you. If anyone provides you with different or additional information, not included in this 6-K, you should not rely on it. All defined terms not otherwise defined herein will have the meaning assigned to them in our annual report on Form 20-F for the year ended December 31, 2018, filed with the SEC on March 27, 2019, which we refer to as the “TEO 2018 20-F.”

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PRESENTATION OF FINANCIAL AND OTHER INFORMATION

Telecom Argentina S.A. is a company incorporated under the laws of Argentina. Unless otherwise stated, the terms “the Company,” “Telecom,” “Telecom Group,” “we,” “us,” and “our” refer to Telecom Argentina S.A. and its consolidated subsidiaries as of December 31, 2018. Unless otherwise stated, references to the financial results of “Telecom” are to the consolidated financial results of Telecom Argentina and its consolidated subsidiaries. The Telecom Group is engaged in the provision of fixed and mobile telecommunications services.

Our unaudited consolidated financial statements as of March 31, 2019 and 2018 and for the three-month period ended March 31, 2019 and 2018 and the notes thereto (the “TEO 1Q 2019 Unaudited Consolidated Financial Statements”), have been prepared in accordance with IFRS as issued by the IASB and have been reviewed by Price Waterhouse & Co. S.R.L. (a member firm of the PricewaterhouseCoopers network) an independent registered public accounting firm (“Price Waterhouse”) .

Third-Party Information

The information set forth in this 6-K with respect to the market environment, market developments, growth rates, trends and competition in the markets and segments in which TEO operates are based on information published by the Argentine federal and local governments through the Instituto Nacional de Estadísiticas y Censos (the National Statistics and Census Institute, or “INDEC”) and the Ministry of Public Works, the Banco Central de la República Argentina (the Central Bank of Argentina), the Dirección General de Estadística y Censos de la Ciudad de Buenos Aires (General Directorate of Statistics and Census of the City of Buenos Aires) and the Dirección Provincial de Estadística y Censos de la Provincia de San Luis (Provincial Directorate of Statistics and Census of the Province of San Luis), as well as on independent third-party data, statistical information and reports produced by unaffiliated entities such as Dataxis, International Data Corporation (“IDC”), SNL Kagan Media-Communications (“Kagan”) and Pyramid Research Inc. (“Pyramid”), as well as on our own internal estimates.

Market studies are frequently based on information and assumptions that may not be exact or appropriate, and their methodology is by nature forward looking and speculative. This 6-K also contains estimates made by us based on third-party market data, which in turn is based on published market data or figures from publicly available sources.

We have not verified the figures, market data or other information on which third parties have based their studies nor have such third parties verified the external sources on which such estimates are based. Therefore we do not guarantee, nor do we assume responsibility for, the accuracy of the information from third-party studies presented in this 6-K or for the accuracy of the information on which such third-party estimates are based.

This 6-K also contains estimates of market data and information derived therefrom which cannot be gathered from publications by market research institutions or any other independent sources. Such information is based on our internal estimates. In many cases there is no publicly available information on such market data, for example from industry associations, public authorities or other organizations and institutions. We believe that these internal estimates of market data and information derived therefrom are helpful in order to give investors a better understanding of the industry in which we operate as well as our position within this industry. Although we believe that our internal market observations are reliable, such estimates are not reviewed or verified by any external sources. In addition, such estimates reflect various assumptions made by us that may or may not prove accurate, as well as the exercise of a substantial degree of judgment by management as to the scope and presentation of such information. No representations or warranties can be made concerning the accuracy of our estimates of market data and the information received therefrom. These may deviate from market data estimates made by our competitors or future statistics provided by market research institutes or other independent sources.  We cannot assure you that our market data estimates or the assumptions are accurate or correctly reflect the state and development of, or our position in, the industry.

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INDEX TO THE UNAUDITED FINANCIAL STATEMENTS OF TELECOM ARGENTINA S.A.

Unaudited Consolidated Financial Statements (as of and for the three-month period ended March 31, 2019 and 2018)

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TELECOM ARGENTINA S.A.

Unaudited Condensed Consolidated Financial Statements as of March 31, 2019

Alicia Moreau de Justo 50

(1107) Ciudad Autónoma de Buenos Aires

Argentina

$: Argentine peso

US$: US dollar

$43.35 = US$1 as of March 31, 2019

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TELECOM ARGENTINA S.A.

UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS AS OF MARCH 31, 2019 AND 2018

INDEX

Operating and Financial Review and Prospects

Unaudited consolidated financial statements

Unaudited consolidated statements of financial position

Unaudited consolidated income statements

Unaudited consolidated statements of comprehensive income

Unaudited consolidated statements of changes in equity

Unaudited consolidated statements of cash flows

Notes to the unaudited consolidated financial statements

Limited review report on interim condensed consolidated financial statements

Corporate information

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TELECOM ARGENTINA S.A.

OPERATING AND FINANCIAL REVIEW AND PROSPECTS AS OF MARCH 31, 2019

(In millions of Argentine pesos or as expressly indicated)

As required by CNV regulations, the Company has prepared its unaudited consolidated financial statements as of March 31, 2019 under IFRS.

As provided under Resolution No. 777 issued by the CNV on December 28, 2018, this Report discloses the comparative balances for the three-month period ended March 31, 2018, restated to current currency as of March 31, 2019.

The table below shows the evolution of the National Consumer Price Index (National CPI with the characteristics identified in Note 1.e) to the consolidated financial statements) of the last three years and as of March 31, 2019 and 2018 according to official statistics (INDEC) used for the preparation of this operating and financial review and prospects and the accompanying financial statements:

As established by the rules of the CNV, it will be included comparative information restated to current currency as of the closing date until reaching five comparative fiscal years.

·                 Revenues

During 1Q19 consolidated revenues showed a variation of -9.0% (-$4,397 vs. 1Q18) amounting to $44,328. This is due to the Mobile, Internet and Cable TV service revenues, partially offset by higher Fixed and Data Services revenues.

Services revenues amounted to $41,521 (-8.2vs. 1Q18) and represent 93.7% of revenues. Mobile services revenues amounted to $14,813 in 1Q19 (-$2,630 vs. 2018), Internet Services revenues amounted to $10,152 in 1Q19 (-$649 vs. 2018) and the Cable Television Services revenues amounted to $9,575 in 1Q19 (-$961 vs. 2018). Equipment revenues decreased 19.9%, amounting to $2,807 and represent 6.3% of revenues.

Total Revenues include approximately $1,868 and $18,027 as of 1Q19 and 1Q18, respectively, related to the effect of restatement in terms of current currency as of March 31, 2019.

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Mobile Services

Mobile services revenues amounted to $14,813 (-$2,630 or -15.1% vs. 1Q18), being the main service in term of service revenues (35.7% and 38.6% of services revenues in 1Q19 and 1Q18 , respectively ). The variation was mainly due to mobile services revenues in Argentina, which amounted to $12,936 (-$2,960 or -18.6% vs. 1Q18), due to the decrease in the customers´ base of 4.1% and approximately -11.5% in ARPU.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in mobile services revenues amounts, approximately, to $612 and $6,498, as of 1Q19 and 1Q18, respectively.

Personal’s mobile customers amount to 18.2 million and 18.9 million as of March 31, 2019 and 2018, respectively, of which 7.3 million and 6.7 million correspond to postpaid customers, respectively. The main ratios related to the services provided to these customers were:

·                   Approximately 60% of the total of customers consist of prepaid customers, and 40% consist of postpaid customers as of March 31, 2019, while it amounts to 65% and 35% respectively, as of March 31, 2018.

·                   Mobile Internet services revenues are equivalent to 73% of Personal’s customers total services revenues.

·                   The monthly average revenue per user (“ARPU”) is $225.5 pesos per month in 1Q19 (vs. $254.8 pesos per month in 1Q18), representing a -11.5% variation.

·                   ARPU contemplates an increase in the prices of postpaid and “abono fijo” customers of approximately 39% in relation to the monthly charges as of March 31, 2018.

·                   The average churn rate per month amounted to 2.6% in 1Q19 (vs. 2.7% average in 1Q18).

During the fourth quarter of 2018, the integration mobile service brands began with the launch of a campaign to transport Nextel’s customers to Personal. This communication was accompanied by the presentation of Personal’s new Smart Radio service, which includes the benefits of the most modern 3G/4G network in the market. Smart Radio enables customers to communicate with all users who share the radio network, including other providers besides Personal, through the use of robust equipment or smartphones which are compatible with the application of the service.

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, which currently covers more than 1,500 locations from La Quiaca to Ushuaia, and reaching more than 12.5 million customers with 4G devices throughout the country. Accompanying these improvements, through a massive communication campaign, the 4G Personal Network was promoted as the fastest in the country -based on the results of international benchmarks that measure network standards through the worldwide experience of customers-.

On the other hand, in the first months of this year, Personal and Fibertel brands came together to offer the best Wi-Fi connectivity and 4G service experience, with benefits for their Club Personal customers.

Mobile services revenues generated in Paraguay amounted to $1,877 (+$330 or +21.3% vs. 1Q18) due to the appreciation of the Guaraní against the Argentine Peso by 48.4% and to the increase in ARPU, while the customer base remained stable.

The main ratios related to the mobile services in Paraguay were:

·                   The monthly ARPU amounted to $232.6 pesos in 1Q19 (vs. $180.5 pesos in 1Q18), representing a 28.9% increase. This increase is mainly due to a 5.6% increase in the ARPU in Guaraníes in addition to the variation of the average exchange rate.

·                   The average churn rate per month amounted to 2.7% in 1Q19 (vs. 3.3% in 1Q18).

Internet Services

Internet services revenues amounted to $10,152 in 1Q19 (-$649 or -6.0% vs. 1Q18) driven mainly by the variation in the broadband ARPU of -7.1%, which reached $819.4 pesos in 1Q19 vs. $882.3 in 1Q18, maintaining stable the subscriber base in 1Q19, which amounts to 4.1 million. The average price of fees increased approximately by 39% with impact on the ARPU of March 31, 2019 vs. 2018.

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It should be noted that customers with service of 20Mb or higher represent 44.0% and 25.4% of the total customer base as of March 31, 2019 and 2018, respectively. These revenues represent a 49% and 29% of total Internet services revenues as of March 31, 2019 and 2018, respectively. Within this range there are customers who have plans of 100 Mb and 300 Mb (recently released to the market), that as of March 31, 2019 amount to 199,445 and 1,416, respectively.

Internet services churn rate per month amounted to 2.0% and 1.8% as of March 31, 2019 and 2018, respectively.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in internet services revenues amounts, approximately, to $436 and $3,948, as of 1Q19 and 1Q18, respectively.

Cable Television Services

Cable Television service revenues amounted to $9,575 in 1Q19 (-$961 or -9.1%vs. 1Q18). The variation is mainly due to the effects of the ARPU and a lower customer base of approximately 2.3%. The ARPU has varied by -12.2%, reaching $871.5 in the 1Q19 vs. $993.1 in 1Q18. It contains a price increase in the average monthly fees of 39% in relation to the monthly fees as of March 31, 2018.

The average monthly churn of 1Q19 amounted to approximately 1.5% (vs. 1.3% in 1Q18).

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Cable television services revenues amounts, approximately, to $411 and $3,870, as of 1Q19 and 1Q18, respectively.

Fixed Telephony and Data Services

Fixed Telephony and data services revenues amounted to $6,865 (+$657 or +10.6% vs. 1Q18), mainly due the increase in data services in the context of the Company’s position as an integrated ICT service provider (Datacenter, VPN, among others) in wholesale and government customers.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Fixed and Data services revenues amounts, approximately, to $284 and $2,283, as of 1Q19 and 1Q18, respectively.

In relation to Fixed telephony services, there have been increases in monthly fees charged to both corporate and residential fixed telephony customers, and in greater sales of combined product packs that include voice and Internet services, that aim to achieve higher levels of customer loyalty, partially offset by a 7.7% decrease in fixed telephony customers´ base as compared to 1Q18. The average monthly revenue billed per user (“ARBU”) of fixed telephony services remained constant and amounted to $314.3 in 1Q19.

On the other hand, the increase in Data services revenues, is mainly due to the variation of the $/US$ exchange rate related to agreements settled in such foreign currency.

Equipment

Equipment revenues amounted to $2,807 (-$699 or -19.9% vs. 1Q18). This variation is mainly due to lower handsets sold as compared to 1Q18 (-24%), partially offset by an approximately 69% increase in handset sale prices to the mobile services customers as compared to 1Q18.

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 terms of the current currency as of March 31, 2019 included in Equipment revenues amounts, approximately, to $119 and $1,311, as of 1Q19 and 1Q18, respectively.

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·                 Operating costs

Consolidated operating costs totaled $29,837 in 1Q19, which represents a decrease of $455 or -1.5% vs. 1Q18. These lower costs are mainly associated with the decrease in Interconnection and transmission costs, Taxes and fees with the Regulatory Authority, Commissions and advertising and Cost of equipment and handsets, partially offset by the increase in Employee benefit expenses and severance payments, Fees for services, maintenance, materials and supplies and for an increase in the charge for bad debt expenses.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Operating costs amounts, approximately, to $1,699 and $11,387, as of 1Q19 and 1Q18, respectively.

The costs breakdown is mainly as follows:

Employee benefit expenses and severance payments

Employee benefit expenses and severance payments amounted to $8,783 in 1Q19 (+$494 or +6.0% vs. 1Q18). 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, as well as higher charges for dismissals, due to a decrease in headcount of 7.0%, which amounted to 24,908 employees in 1Q19 (vs. 26,770 in 1Q18).

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Employee benefit expenses and severance payments amounts, approximately , to $369 and $3,072, as of 1Q19 and 1Q18, 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, decreased, amounting to $1,466 in 1Q19 (-$41 or -2.7% vs. 1Q18), mainly due to operating efficiencies as of March 31, 2019 as compared to March 31, 2018, partially offset by greater traffic and increases in the exchange rate in relation to services set in U$S.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Interconnection and transmission costs amounts, approximately, to $60 and $576, as of 1Q19 and 1Q18, respectively.

Fees for services, maintenance, materials and supplies

Fees for services, maintenance, materials and supplies amounted to $4,504 in 1Q19 (+$234 or +5.5% vs. 1Q18). The increase is mainly due to increases in fees for services, related to call centers for increased activity and price increases, to professional fees driven by a higher level of activity and new Company projects and services related to operational management in general. There were also higher technical, hardware and software maintenance costs due to the increase in prices and fluctuation of the exchange rate $/US$. This effect was partially offset by the processes synergies resulting from the merger of Telecom and Cablevisión in January 2018.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Fees for services, maintenance, materials and supplies amounts, approximately, to $369 and $1,389, as of 1Q19 and 1Q18 , 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 $3,483 in 1Q19 (-$427 or -10.9% vs. 1Q18). This decrease corresponds mainly to the effect of the decrease in sales in 1Q19 vs. 1Q18 partially offset by the impact of the application of ENACOM Resolution No. 840/2018 that introduced changes in the determination of the radioelectric rights fee.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Taxes and fees with the Regulatory Authority amounts, approximately, to $150 and $1,441, as of 1Q19 and 1Q18, respectively.

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Commissions and advertising

Commissions (including commissions paid to agents, prepaid card commissions and other commissions) and advertising totaled $2,518 in 1Q19 (-$363 or -12.6% vs. 1Q18). The decrease is due to lower charges for agent commissions as a result of the reordering of the sales channel and a slight decrease in advertising due to the synergies after the merger of 2018 that allowed reducing costs even with greater presence in various media, partially offset by higher collections fees.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Commissions and advertising amounts, approximately, to $105 and $1,172, as of 1Q19 and 1Q18, respectively.

Cost of equipment and handsets

Cost of equipment and handsets sold totaled $2,182 in 1Q19 (-$437 or -16.7% vs. 1Q18 ). $2,105 of this amount correspond to cost of handsets sold in Argentina, which decreased 16.6% vs. 1Q18, mainly due to lower handsets sold as compared to 1Q18 (-24%), partially offset by the increase in the purchase prices of handsets as compared to 1Q18.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Cost of equipment and handsets amounts, approximately, to $336 and $1,094, as of 1Q19 and 1Q18, respectively.

Bad debt expenses

Bad debt expenses amounted to $1,448 (+$476 or +49.0 % vs. 1Q18). The increase is related to the reduction in the level of collections. Bad debt expenses represent 3.3% and 2.0% of the consolidated revenues in 1Q19 and in 1Q18, respectively.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Bad debt expenses amounts, approximately, to $61 and $359, as of 1Q19 and 1Q18, respectively.

Other operating income and expenses

Other operating income and expenses include provisions, energy and other public services, insurance, leases and internet capacity, among others. The decrease is mainly due to a decrease in operating leases due to the application of IFRS 16, as explained in Note 1.f) to the consolidated financial statements partially offset by increases in energy costs.

The effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Other operating income and expenses amounts, approximately, to $99 and $1,016, as of 1Q19 and 1Q18, respectively.

Depreciation, amortization and impairment of PP&E, Intangible assets and Rights of use

Depreciation, amortization and impairment of PP&E, Intangible assets and Rights of use amounted to $9,995 (+$1,501 or +17.7% vs. 1Q18). The increase is due to the impact of the amortization of the CAPEX subsequent to March 31, 2018 as a consequence of the adjusted investment plan that the Company is developing and the effect of the application of IFRS 16 as of January 1, 2019, as disclosed in Note 1 to the Consolidated Financial Statements as of March 31, 2019 of Telecom of $617, partially offset by assets that have stopped amortizing in 2019.

On the other hand, the effect generated by the restatement in terms of the current currency as of March 31, 2019 included in Depreciation, amortization and impairment of PP&E, Intangible assets and Rights of use amounts, approximately, to $3,643 and $3,827, as of 1Q19 and 1Q18, respectively.

·                 Operating income

Operating income amounted to $4,496 in 1Q19 (-$5,443 or -54.8% vs. 1Q18 ), representing 10.1% over consolidated revenues represented in 1Q19 (vs. 20.4% in 1Q18 ).

·                 Financial results, net

Financial results, net resulted in a gain of $105 and $3,817 in 1Q19 and 1Q18, respectively. The variation in Financial Results, net is mainly due to higher foreign currency exchange net losses due to the depreciation of the peso against the US$ during 1Q19 (15% vs. 8% in 1Q18), higher interest losses amounting to $642 corresponding to the net financial debt, partially offset for the restatement in terms of current currency , which amounts approximately to $3,621 and $4,669 in 1Q19 and 1Q18, respectively.

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·                 Net income

Telecom Argentina recorded a net income of $1,279 in 1Q19, which means a decrease of $10,122 in relation to the income of $11,401 in 1Q18, representing 2.9% of the revenues (vs. 23.4% in 1Q18 ). Net income attributable to controlling shareholders amounted to $1,232 in 1Q19 vs. an income of $11,374 in 1Q18 .

·                 Financial position, net

The consolidated financial position, net (that is: Cash and cash equivalents plus Financial investments and financial IFD less Financial debts) is debt and totaled $71,601 and $73,392 as of March 31, 2019 and as of December 31, 2018, respectively.

·                 Capital expenditures (CAPEX) and Rights of use additions

CAPEX and Rights of use additions composition 1Q19 and 1Q18 is as follows:

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 3G and 4G services to support the growth of mobile Internet services, improvement of the quality service together with the launch of innovative VAS services.

It also 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 growing demand of services of both fixed telephony and mobile services customers. Likewise, significant investments have also been made in the pricing, billing and customer relationship systems.

In relation to the additions of the Rights of Use, IFRS 16 provides that, from the years beginning on January 1, 2019, the Company as lessee recognizes a right of use asset and a liability at present value for those contracts that meet the definition of lease contracts in accordance with such standard.

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(i)                 Base December 2013= 100

(ii)               Base December 2015= 100

(iii)             Base December 2017= 100

1)                 Current assets/Current liabilities.

2)                 Total equity/Total liabilities.

3)                 Non-current assets/Total assets.

In macroeconomic terms, in the first months of 2019 the slowdown tendency of the country’s economic growth continued, which began in mid-2018. The main variables that affect this situation are associated with the sustained increase in inflation levels, high interest rates and the peso devaluation that is affecting the Argentine economy in the last months.

The economic-financial performance of Telecom - and other companies that operate in Argentina- were not exempt to the impact of exchange differences, especially for a company that has to make intensive investments in infrastructure, with dollarized inputs, but operates in Argentine pesos in the local market.

Even though we continue to ratify our long-term commitment with the country, through a strategic investment strategic plan destined to the deployment of infrastructure and system integration, the economic situation forces us to focus strongly on operating efficiencies management to maintain levels of growth in line with the investments committed.

In order to meet the expected investment levels, during the month of February, Telecom subscribed a financing agreement with the International Finance Corporation (IFC), an institution of the World Bank Group for the private sector, for a total amount up to US$ 450 million. The resources are destined to continue the deployment of infrastructure of our fixed-mobile convergent network with differential characteristics.

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Regarding the framework that regulates our activity, we continue accompanying the government’s vocation to extend connectivity throughout the country, encouraging the willingness of companies such as Telecom, with the capacity and commitment to build modern and powerful networks that bring high quality products and services to Argentina.

We are focused on providing the best offer of products and services in terms of speed, quality, technological reliability together with high-value contents. During 2019, Telecom plans to give continuity to the technological reconversion process and management systems update in order to provide the best service to our customers.

We continue deploying fiber optic increasingly closer to the homes, unifying different access technologies to improve browsing speeds and converting the fixed copper networks into fiber or hybrid fiber-coaxial networks to offer higher connection speed and capacity. This process is enhanced by a strong commercial leverage of the Fibertel brand, which has the best performance in terms of customer preference.

Regarding the mobile network we have the fastest 4G service in the country, and we continue to expand its coverage and capacity through the 4.5G network, as a way to prepare for 5G technology and the internet of things.

Our daily challenge is to reach to customers with applications and content that they can consume from any device, fixed or mobile, anywhere and at any time. That is why we offer high quality content through Flow, a unique entertainment platform, which contains co-productions and variety and high-quality content.

We also have the differential value of high capacity and capillarity of the IP interurban transport network, with a new architecture that will allow to transport not only own digital contents but also those of third parties.

The complete integration of our mobile fixed network, the most powerful and sustainable of our country, will allow us to deepen the transformation plan of contents and IP video services, among which Flow is the ultimate offering.

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The accompanying notes are an integral part of these unaudited consolidated financial statements.

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See Note 22 for additional information on operating expenses per function.

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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The accompanying notes are an integral part of these unaudited consolidated financial statements.

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(1) As of March 31, 2019 and 2018 total shares (2,168,909,384), of $1 argentine peso of nominal value each, were issued and fully paid. As of March 31, 2019 and 2018, 15,221,373 were treasury shares.

(2) Corresponds to 15,221,373 shares of $1 argentine peso of nominal value each, equivalent to 0.70% of total capital.

(3) Correspond to the Facultative Reserves to maintain the capital investments level and the current level of solvency.

(4) Call option reserve of non-controlling interest.

(5) As approved by the Company’s Board of Directors on January 31, 2018. Includes 15,780 of advanced dividends which were subsequently ratified by the General Ordinary Shareholders’ Meeting held on April 25, 2018.

The accompanying notes are an integral part of these unaudited consolidated financial statements.

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