SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
For the month of October 2009
(Commission File No. 1-15256)
BRASIL TELECOM S.A.
(Exact name of Registrant as specified in its Charter)
BRAZIL TELECOM COMPANY
(Translation of Registrant’s name into English)
SIA Sul, Área de Serviços Públicos, Lote D, Bloco B
Brasília, D.F., 71.215-000
Federative Republic of Brazil
(Address of Registrant’s principal executive offices)
Indicate by check mark whether the registrant files or will file
annual reports under cover Form 20-F or Form 40-F.
Form 20-F x 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) ¨.
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.
Yes ¨ No x
If “Yes” is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b):
 Investor
Relations CONFERENCE CALL 3Q09 October 23, 2009 |
 Oi and BrT Integration Status of the Process of Operational Integration Market and Channels 9M09 Achievements 100% of mobile service retail sales made in the new portfolio Unique operating model for sales and service Distribution model restructuring in Region II, focused on small retail and virtual recharge Authorized Agents focused on the post paid segment Differentiated actions by client profile in Business market National coverage consolidation for Corporate segment Engineering and Network Opex Synergies Consolidation of just one NOC* to provide an integrated vision and management for the entire network Implementation of a model of a single supplier to service internal plant requirements in Regions I and III Integration of network development, planning, and operation activities Main actions aimed to seize Cost synergies Implementation of the last stage of company´s administrative restructuring Review of logistics models Adoption of sim-card alone strategy to reduce COGS Reduction in roaming costs Main actions to rationalize Capex: Supplier Consolidation Optimization of IT investments Renegotiation with third parties 2 Investor Relations| * Network Operational Center |
 Oi and BrT Integration Corporate Restructuring Status: as of 4Q09, 100% of the good will amortization will generate fiscal benefits 3 Investor Relations| 07/31/09: 1st Stage of the Corporate Simplification Copart 2 Copart 2 Copart 1 Copart 1 100% 82% 100% 100% 100% 19% 67% 11% 36% 100% 67% 82% BrTP BrTP 100% 67% 82% 100% 82% Companies Merged TMAR TNL Coari Coari TMAR TNL BrTP BrTP BrTO BrTO TNL TNL TMAR TMAR Coari Coari BrTO BrTO Invitel/ Solpart 55% 55% 48% |
 Consolidated
RGUs Million +14.2% 53.0 60.5 3Q08 3Q09 Net Additions Customer Base Million 7.5 Fixed Lines Broadband* Mobile -3.0% * Includes Oi TV´s cable users (52,000 clients) Consolidated Revenue Generating Units 7 million new customers were added in the last 12 months, mainly mobile and broadband 12.5% 28,4% 4 Investor Relations| 3Q08 3Q09 3Q08 3Q09 3Q08 3Q09 • Total broadband net addtions in 3Q09: 154 thousand (76 thousand fixed broadband and 78 thousand in 3G, mainly mini-modens) • Fixed + mobile broadband: 4.5 mn clients |
 Consolidated
Mobile Users São Paulo leads net adds in past 12 months; Oi Conta Total represents 37% of Region I´s post paid base Mobile Customer Base Million 27.1 3Q08 3Q09 RI Net Additions RII RIII 1.7 1.6 4.4 34.8 22.7 4.4 29.2 5.6 • Prepaid – 89% of net additions in the last 12 months – 84% of total mobile customer base by end of the quarter • Post-Paid + Control Plan – “Oi Conta Total” amounted to 1.5 mn in Sept 09 (~700 th. plans), 58% above Sept 08 – Bundle product accounted for 37% of Oi´s Region I post-paid users (area where product is available) • National Market Share of 21.0% in Sept 09, as follows: – 29% in Region I (leader) – 16% in Region II (14.3% in Sept/08) – 10.5% in Region III (11 months after start-up) Post-paid+ Control Plans Prepaid 7.6% 30.4% 5 Investor Relations| |
 Financial
Performance – Consolidated Gross Revenue Mobile and Broadband as main growth drivers for revenues; Strong Mobile Value Added Service 3Q08 3Q09 Consolidated Gross Revenue 11,193 11,597 0.8% 3Q8 Fixed Mobile 3.6% R$ Million Consolidated Gross Fixed Revenues Growth– 3Q09 x 3Q08 R$ million Data F-M Local Data and VAS TOTAL 14.8% Local Consolidated Gross Mobile Revenues Growth – 3Q09 x 3Q08 R$ million 6 Investor Relations| * Includes Fixed-Fixed, Fixed-Mobile and Mobile-Originated Long Distance Network Usage LD* Public Phones Subscripti ons TOTAL Data Network Usage Originated Calls Handset Revenue Roaming |
 Financial
Performance – Consolidated Costs & Expenses and EBITDA Recurring Costs decreased and Recurring EBITDA showed recovered in 3Q09 7 Investor Relations| 3Q08 3Q09 Recurring and Comparable Consolidated Operating Costs and Expenses R$ Million Consolidated EBITDA – Oi (TNE) R$ Million; Margin % EBITDA Margin 34.0% 35.1% 3Q08 3Q09 Recurring non-recurring items - 5.8% + 3.0% |
 Other Items in the
Consolidated Result Although still not able to have full tax benefits related to total
goodwill amortized, this was not enough to reverse quarterly result Consolidated Net Financial Result R$ Million Net Income R$ Million 3Q08 3Q09 3Q08 3Q09 -R$81 mn Depreciation and Amortization R$ Million 3Q08 3Q09 +R$231 mn 8 Investor Relations| • Factors affecting net income: – Higher net financial expenses – Goodwill amortization derived from the acquisition of Brasil Telecom – Temporary fiscal effects (amortization expenses without benefits of tax credits) • Non-recurring operating expenses due to the acquisition of BRTO and start-up in São Paulo |
 Financial
Performance: Consolidated Debt Non-recurring effects and temporary fiscal effects
related to goodwill amortization for BRTO’s acquisition affected quarterly result Consolidated Gross Debt R$ Billion Sep/08 Jun/09 17.8 29.6 Local Currency Foreign Currency Sep/09 28.6 Sep/08 Jun/09 Sep/09 Consolidated Net Debt R$ Billion Gross Debt Amortization R$ Billion 2010 2011 2012 2013 2014 onwards 9 Investor Relations| 2009 • Foreign exchange exposure: 1.8% of total debt as of September/09 • Effective cost of debt: 9.5% (vs 11.45% in 2Q09) • Net Debt/Recurring EBITDA: 2.1x (LTM) |
 • Consolidated CAPEX : – 17.8% of 3Q09 net revenue ( vs. 19.5% in 3T08); 14.3% of 9M09 net revenues – 77% directed to growth business (46% Mobile and 31% Data/Broadband) • Fixed Telephony Capex: – Reduction stems from high volume in 3Q08 earmarked to adapt the switching centers to portability, despite higher investments to expand broadband capacity and coverage • Mobile Telephony Capex: – Increase to expand network and quality Financial Performance: Consolidated CAPEX 77% of CAPEX is earmarked to growth businesses: Wireless segment and Data Transmission / broadband CAPEX R$ Million 3Q08 3Q09 1,345 Fixed Mobile 1,474 -8.8% 10 Investor Relations| 3,190 9M09 |
 Q
& A |
SIGNATURES
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.
Date: October 23, 2009
| BRASIL TELECOM S.A. | ||
| By: | /S/ ALEX WALDEMAR ZORNIG | |
| Name: Alex Waldemar Zornig | ||
| Title: Chief Financial Officer | ||