Consolidated Net Revenues amounted to P$4,131 million (+27% vs. 1Q10); Mobile business in Argentina +33% vs. 1Q10; Internet +25% vs. 1Q10.

Mobile subscribers in Argentina +1.9 million (+13% vs. 1Q10).

Mobile Value Added Services in Argentina: +72% vs. 1Q10; 46% of Service Revenues.

Mobile ARPU reached P$47 in 1Q11 (+16% vs. 1Q10).

ADSL ARPU increased to P$81 in 1Q11 (+10% vs. 1Q10); churn decreased to 1.2% from 1.8% in 1Q10.

Operating Profit Before Depreciation and Amortization (“OPBDA”) reached P$1,342 million (+26% vs. 1Q10), 32% of Net Revenues.

Operating Profit amounted to P$980 million (+28% vs. 1Q10).

Net Income reached P$628 million (+53% vs. 1Q10) due to growth in OPBDA and lower financial expenses.

Net Cash Position: P$1,712 million, an increase of P$852 million vs. 1Q10 due to a strong cash generation.

(in million P$, except where noted)

Consolidated Net Revenues

Voice, Data and Internet

Mobile

Operating Profit before D&A

Operating Profit

Net Income

Shareholders’ equity

Net Financial Position - Cash

CAPEX (excluding materials)

Fixed lines in service (in thousand lines)

Mobile customers (in thousand)

Personal (Argentina)

Núcleo (Paraguay) -including Wimax customers-

Broadband acceses (in thousand)

Fixed line traffic (in MM minutes, Internet & Public Telephony not incl.)

Incoming / Outgoing mobile voice traffic in Arg.(in MM minutes)

Average Billing per user (ARBU) Fixed Telephony / voice (in P$)

Average Revenue per user (ARPU) Mobile Services in Arg. (in P$)

Average Revenue per user (ARPU) ADSL (in P$)

Net Revenues (MMP$)

Net Income (MMP$)

Earnings per Share (P$)

Earnings per ADR (P$)

OPBDA *

Operating Profit *

Net Income*

Mobile Services

Clients have increased in 1Q11, reaching 18.8 million as of the end of March 2011, representing an increase of 2 million since March 31, 2010.

The activities developed to increase the usage of the value added services (“VAS”) and to retain high value segments allowed Personal to increase consolidated net revenues to P$2,899 million (+34% vs. 1Q10).

Telecom Personal in Argentina

As of March 31, 2011, Personal reached 16.9 million subscribers in Argentina (+13% or 1.9 million vs. 1Q10), thus improving its market position in subscribers and revenues. The overall subscriber base mix continued with 70% of prepaid and 30% postpaid (including “Cuentas claras” plans and 3G modems).

In 1Q11, Net Revenues reached P$2,734 million (+P$673 million or 33% vs. 1Q10) while Service Revenues (excluding handset sales) amounted to P$2,431 million (+30% vs. 1Q10), with 46% corresponding to value-added services (‘VAS’) revenues. VAS revenues increased 72% vs. 1Q10.

During 1Q11, the overall voice traffic minutes increased by 9% vs. 1Q10. Meanwhile, SMS traffic performance (incoming and outgoing charged messages), climbed to 5,164 million in 1Q11 from a monthly average of 4,258 million messages in 1Q10 (+21% vs. 1Q10). Due to this increase in traffic and VAS usage, Average Monthly Revenue per User (ARPU) increased to approximately P$47 during 1Q11 (+16% vs. 1Q10).

During the first quarter of the year, Personal extended its premium platform -Personal Black- by incorporating a tablets portfolio, which adds to the 3G Internet mobile plans, special contents to maximize customer experience. Therefore, Personal continued to focus on innovation with smart devices that enhance accesses to services, contents and mobile Internet.

Furthermore, during 1Q11, Personal continued with its convenience strategy of fostering benefits such as service packs and recharges to its client base (double and triple credit). Personal also enlarged its “All Included” plans, enhancing handset availability to access to new services and customer satisfaction.

In addition, Personal continued its brand positioning associated to music by organizing several events and concerts, such as the first edition of “Personal POP Festival”. Also in brand positioning, Personal was the main sponsor in the Rally Dakar 2011 competition. All these initiatives were accompanied with specific content, special offers and customer loyalty oriented actions.

Finally, as part of its youth segment strategy, Personal consolidated its presence in social networks (such as Facebook and Twitter) as a relation channel and customer service.

Telecom Personal in Paraguay

By the end of March 2011, Nucleo’s subscriber base surpassed 1.9 million clients (+5% vs. 1Q10), including Wimax clients. Prepaid and Postpaid customers represented 84% and 16%, respectively.

Personal’s subsidiary in Paraguay generated revenues equivalent to P$165 million during 1Q11 (+56% vs. 1Q10) with an increase in the level of ARPU that reached more than U$S6 (+39% vs. 1Q10) and an appreciation of the Guaraní.

Fixed Services (Voice, Data Transmission & Internet)

During 1Q11 revenues generated by fixed services amounted to P$1,232 million, +14% vs. 1Q10; with Internet revenues growing in relative terms the most in this segment (+25% vs. 1Q10), followed by Data (+15% vs. 1Q10).

Voice

Total Revenues for this service reached P$752 million in 1Q11 (+9% vs. 1Q10). The results of this line of business continue to be affected by frozen tariffs of regulated services.

Monthly Charges and Supplementary Services increased by P$14 million, or +6% vs. 1Q10, to P$230 million, as a consequence of a higher number of lines in service (+1%), which surpassed 4.1 million, and a 19% increase in supplementary services.

Interconnection revenues reached P$113 million (+14% vs. 1Q10), mainly due to an increase in mobile interconnection prices.

Public telephony reached P$14 million (-P$3 million vs. 1Q10). Finally, other revenues totaled P$52 million (+18% vs. 1Q10) mainly due to higher sales of fixed line equipment.

Data Transmission and Internet

Data transmission revenues amounted to P$85 million (+15% vs. 1Q10), where the focus was to strengthen Telecom’s position as an integrated ICT provider.

During 1Q11 Telecom continued promoting its Virtual Central, the communications platform that combines the traditional PBX service with advanced functions that enhance the integration with IT tools and allows savings in infrastructure costs.

During 1Q11, Telecom continued offering Data services in the SMEs segment benefiting from its competitive advantage of being an integrated operator. As a result, there was an annual increase of 50% in Internet and a 36% in Virtual Private Networks (VPN) accesses. In this quarter, ArnetBIZ portfolio services increased by 18% vs.1Q10.

In this period, Telecom continued focusing in MPLS network technology to private and public sectors, incorporating datacenter services and new technologies to the cloud computing solutions.

Revenues related to Internet totaled P$395 million (+P$79 million or 25% vs. 1Q10), mainly due to the continued expansion of broadband services.

As of March 31, 2011, Telecom surpassed 1.4 million ADSL accesses (+14% vs. 1Q10). These connections represented 34% of Telecom’s fixed lines in service. In addition, ADSL ARPU reached to P$81 in 1Q11, +10% when compared to 1Q10 and churn reached 1.2% in 1Q11 (vs. 1.8% in 1Q10).

During 1Q11, Telecom continued enhancing the broadband offers with the aim of increasing the customer base, thus under the slogan “Internet en Todo” (Internet everywhere), positioned the Internet as a tool for the different aspects of everyday’s life. With this concept, Arnet presented its bundled offers with complementary services such as local calls or mobile Internet through “Arnet Móvil”. In 1Q11 more than 30% of the new Arnet broadband customers’ chose this bundled offer.

Consolidated Operating Costs

The Cost of Services Provided, Administrative Expenses and Selling Expenses totaled P$3,151 million in 1Q11, an increase of P$665 million, or +27%, vs. 1Q10. The increase is a consequence of higher commercial costs due to a higher volume of revenues, inflationary effects on the general cost structure, and greater expenses related to competition in the industry.

The cost breakdown is as follows:

•        Salaries and Social Security Contributions totaled P$513 million (+27% vs. 1Q10), mainly affected by increases in salaries due to the labor agreement arranged in July 2010 and the increase in employees. Regarding personnel, in the same period the incorporation of 498 employees in the mobile business and the decrease in headcount in the fixed line business (-180 employees vs. 1Q10) resulted in a total headcount at the end of the period of 15,723 employees.

•        Taxes reached P$362 million (+33% vs. 1Q10), impacted by higher rates in turnover taxes applied to higher volume of revenues, by taxes related to debit and credit taxes, and by higher taxes from provincial and municipal jurisdictions.

•        Network access costs (includes TLRD, Roaming, Interconnection, international settlement charges and lease of circuits) amounted to P$366 million, +P$15 million vs. 1Q10. This was mainly due to savings from stimulating on-net traffic among mobile clients and higher mobile coverage that allowed savings in roaming costs.

•        Agents, prepaid card commissions and other commissions were P$383 million (+39% vs. 1Q10), mainly due to the increase in commissions paid to commercial agents associated with higher revenues from more sophisticated handsets, higher costs associated with a higher volume of acquisitions and retention of customers and higher cards sales and prepaid recharges.

•        Advertising amounted to P$132 million (+67% vs. 1Q10), oriented towards supporting the commercial activity in mobile and Internet services in the summer season and to strengthen the Telecom Group brands.

•        Cost of handsets sold totaled P$418 million (+40% vs. 1Q10) due to an increase in high-end handsets sales and a higher number of handsets upgrade, to stimulate VAS usage. These effects resulted in the increase of the average cost of handsets.

•        Fees for services amounted to $181 million (+35% vs. 1Q10), principally due to higher costs from the call centers, more services requirements, and to the

•         Depreciation of Fixed and Intangible Assets reached P$362 million (+20% vs. 1Q10). Fixed-line telephony totaled P$181 million (+8% vs. 1Q10) and mobile services totaled P$181 million (+36% vs. 1Q10). This increase was due to a higher transfer to fixed assets, mainly in network access, transmission equipment and switching equipment in both businesses.

•         Others Costs totaled P$434 million (+17% vs. 1Q10). This increase was mainly due to general increases in services such as maintenance, materials and supplies, and increase in bad debt expenses of 34% vs. 1Q10 and an increase in costs related to VAS, such as content offers.

Consolidated Financial and Holding Results

Financial and Holding Results resulted in a gain of P$41 million, an increase of P$98 million vs. a loss of $57 million in 1Q10. This was mainly due to losses for FX results of P$2 million in 1Q11 (a gain of P$57 million vs. 1Q10) thanks to the lack of exposure to foreign currency debts; and a gain in net financial interest of P$39 million in 1Q11 (+P$25 million vs. 1Q10).

Consolidated Net Financial Position

As of March 31, 2011, Net Financial Position (Cash, Cash Equivalents and current Investments minus Loans) totaled P$1,712 million in cash, an improvement of P$852 million vs. Net Financial Position as of March 2010. This was due to the strong cash flow generation evidenced in the period.

Consolidated Capital Expenditures

During 1Q11, the Company invested P$335 million (excluding materials). This amount was allocated to Voice, Data and Internet businesses (P$208 million) and Mobile services (P$127 million). In relative terms, capex reached 8% of net consolidated revenues.

Main capex projects are related to the deployment of the network to boost capacity and quality of the Internet services that sustain the growth of Mobile Internet through 3G services together with the launch of innovative VAS, and to support ADSL services to improve customer speed access. Moreover, projects are associated to the expansion of transmission and transport networks to face the growing demand from fixed and mobile customers.

Recent Relevant Matters

The General Ordinary Shareholders’ Meeting of Telecom Argentina approved last April, 7^th, 2011 a cash dividend payment of P$915 million (equivalent to P$0.93 per share) that was paid on April, 19^th.

***********

Nortel Inversora S.A. (“Nortel”), which acquired the majority of the Company from the Argentine government, holds 54.74% of Telecom’s common stock. Nortel is a holding company whose common stock (approximately 70% of capital stock) is owned by Sofora Telecomunicaciones S.A. Additionally, Nortel capital stock comprised of preferred shares that are held by minority shareholders.

As of March 31, 2011, Telecom had 984,380,978 shares outstanding.

(*) Employee Stock Ownership Program

For more information, please contact the Investor Relations Department:

Pedro Insussarry

(5411) 4968 3743

Solange Barthe Dennin

(5411) 4968 3752

Ruth Fuhrmann

(5411) 4968 4448

Horacio Nicolás del Campo

(5411) 4968 6236

Cash, equivalents and investments

Trade receivables

Other current assets

Total Current Assets

Fixed & Intangible assets

Other non-current assets

Total Non Current Assets

Total Assets

Accounts payable

Loans

Taxes payable

Reserves

Other current liabilities

Total Current Liabilities

Accounts payable

Loans

Taxes payable

Reserves

Other non-current liabilities

Total Non Current Liabilities

Total Liabilities

Minority Interest

Shareholders' equity

Total Liabilities, Minority Interest and Equity

Banks and other financial institutions

Bank overdraft

Accrued interest

Total Current Loans

Banks and other financial institutions

Total Non Current Loans

Total Loans

Cash and cash equivalents

Net Financial Position- Cash

Net revenues

Cost of services

Gross Profit

Administrative expenses

Selling expenses

Operating Profit

Financial and holding results

Other expenses, net

Results from ordinary operations

Taxes on income

Minority interest

Net Income

Operating Profit before D & A

As a % of Net Revenues

Financial results generated by assets

Interest

Foreign currency exchange results

Holding results generated by inventories

Other financial results

Total Financial results generated by assets

Financial results generated by liabilities

Interest

Foreign currency exchange results and loss on derivatives

Other financial results

Total Financial results generated by liabilities

Total Financial and holding results

Fixed Telephony

Measured service Local

Measured service DLD

Monthly charges

Public telephones

Interconnection

Others

International Telephony

Data transmission & Internet

Data

Internet

MobileTelephony

Telecom Personal

Monthly fee and measured service

Calling Party Pays

TLRD *

VAS

Handset sales

Others (Includes Roaming)

Núcleo

Monthly fee and measured service

Calling Party Pays

TLRD *

VAS

Internet - Wimax

Handset sales

Others (Includes Roaming)

Total net revenues

Net Revenues

Salaries and social security contributions

Taxes, taxes with the regulatory authority

Materials and supplies

Bad debt expenses

Interconnection cost

Settlement charges

Lease of lines and circuits

Service fees

Advertising

Agent, Prepaid card commissions and other commissions

Cost of voice, data and cellular handsets

Roaming and TLRD

Others

Total Costs before D&A

Operating Profit before D&A

Depreciation of fixed assets

Amortization of intangible assets

Operating Profit

Financial and Holding Income

Other expenses, net

Income from ordinary operations

Taxes on income

Minority interest

Net Income

Service Revenues

Equipment Sales

Other income

Total Revenues

Salaries and social security

Taxes

Interconnection costs and lease of circuits

Agent commissions and distribution of prepaid cards commissions and other commissions

Charges for TLRD and Roaming

Fees for services, maintenance, materials and supplies and advertising costs

Cost of sales

Contingencies