TIM (TIMS3) Q4 2023 earnings summary

Executive summary

• Record 2023 results: normalized service revenue R$23.1B, EBITDA R$11.7B and net income R$2.7B; all grew YoY.

• Stronger cash generation supported R$2.9B in announced shareholder remuneration and an updated growth plan for 2024–2026.

Financial highlights

• 4Q23 normalized net revenue was R$6.275B, up 6.8% YoY; service net revenue rose 7.2% and mobile service revenue rose 7.6%.

• FY23 normalized service revenue reached R$23.1B, up 10.7%; EBITDA was R$11.7B, up 14.2%.

• 4Q23 normalized EBITDA was R$3.150B, up 7.5% YoY; margin was 50.2%, up 0.3 p.p.

• 4Q23 normalized net income was R$900M, up 52.6% YoY; FY23 net income was R$2.7B, up 50.4%.

• FY23 OpFCF was R$4.2B, up 58.2% YoY; capex/revenue was 18.9%.

Outlook and guidance

• 2024 targets: normalized service revenue growth of 5%–7% YoY and EBITDA growth of 7%–9% YoY.

• 2024 nominal capex target is R$4.4B–R$4.6B; EBITDA-AL less capex growth target is double-digit YoY.

• Through 2026, service revenue CAGR target is 5%–6%, EBITDA CAGR 6%–8%, and EBITDA-AL less capex CAGR double-digit; nominal capex remains R$4.4B–R$4.6B annually.

• Guidance is subject to business performance and Board deliberation; capex excludes third license renewal and new auctions.