Presentation of Kęstutis Šliužas, CEO of TEO, at NASDAQ OMX Vilnius event "CEO meets investors" on 3 June 2014.

1. TEO
direction
Kęstutis Šliužas
General Manager of TEO

2. 1. Ongoing integration of
technologies
3. Changing market
situation
4. Demand for the new
breakthrough
2. Change of customers‘
needs and expectations
Why are we changing?

3. IT PLAYERS
FRAGMENTED
LOCAL IT
RISK FOR TELCO'S TO
BECOME SUBSUPPLIERS
Opportunity to expand in
SOHO/SME, fragmented
space
Need to defend
our core
Global IT players attacking
Telco space in Large
Enterprise
TELCO OPERATORS
ICT
SERVICES
TELCO
SERVICES
0-20 FTEs
Single location & vertical
SOHO
20-100 FTEs
Few locations / verticals
Small
100-500 FTEs
Few locations / verticals
Medium
500+ FTEs
Many locations / verticals
Enterprise
Market:IT and telco convergence

4. 0
500
1,000
1,500
2,000
2,500
3,000
271
501
203
428
944
246 220
495
224
320
493
217
350
916
840
303
494
189
550
954
2,574
2,394
2,273
2,145
356
501
159
677
2,884
1,126
38.7 %
10 %
14.5 %10.8 %
23.8 %
2009 2010 2011 2012 2013
Breakdown of 2013 revenue
Network
interconnection
Leased
lines
Audio-video
services
Mobile
voice
Internet and
datacom
-25.6 %
Fixed
voice
Market:situation in Lithuania

5. Our services in Lithuania
areusedby
Every second
family
7 out of 10
enterprises
Highest level
events

6. 0
100
200
300
400
500
600
97 111
14.0 %
IPTV
72 63
12.9 %
DVB-T
594 553
7.0 %
Telephone lines
166 184
10.8 %
FTTH/B
181 175
3.6 %
DSL
42 83
96.4 %
Wi-Fi
31-03-2013
31-03-2014
Operating figures (in thousands)

7. 8.5 %
22.6 %
6.3 %
7.2 %
1.8 %
0
20
40
60
80
100
0
50
100
150
200
81 80 53 50 31 24 18 16 183 169
B2C B2B B2O Q1 2013BDC, Lintel, other Q1 2014
31-03-2013
31-03-2014
Total revenueBy segments
Revenue (LTL million)

8. Operating expenses and
cash flow (LTL million)
0
20
40
60
80
100
120
0
10
20
30
40
50
60
70
80
67.2
42.9 38.2
65.5
19
39.4
-3.6 %
-10.2%
7.6
20
46
104.2
108.4
Q1 2013 Q1 2014 Q1 2013 Q1 2014
3.6 %
0
20
40
60
80
100
120
0
10
20
30
40
50
60
70
80
67.2
42.9 38.2
65.5
19
39.4
-3.6 %
-10.2%
7.6
20
46
104.2
108.4
Q1 2013 Q1 2014 Q1 2013 Q1 2014
3.6 %
Operating expenses Cash flow
COGS
Employee-related
Other expenses
Redundancy charge

9. New structure
of organization
New management
team
Clear responsibilities
and processes
Efficient
organization
Simplier solutions
to customers
Better customers'
experience
Long-term success
on telco and IT market
Program of changes

10. General Manager
Business functions
Business to
Consumers
Technology
& IT
Finance and
Strategic
Planning
Business to
Business
Support functions
Risk Management
Corporate Affairs
Human Resources
Legal Affairs
Process
Internal Audit
New structure

11. All services under one TEO name
New, intuitive graphic user interface of IPTV service
Upgraded Internet offers
E-shop of household electronic equipment
Free of charge customer care by
telephones 1817 and 1816
Integrated virtual storage on TV screen
Complex telco and IT solutions
Common TEO and Omnitel proposals
What is changing?

12. Questions?