Results of the 1st Quarter of 2009

The results of Portugal Telecom in the first quarter of 2009 were announced in a press release today. During this period, consolidated operating revenues totalled Euro 1,604 million a 2.1% increase y.o.y. driven mainly by growth in wireline business in Portugal and Vivo. It is worth highlighting that excluding the effect of consolidation of Telemig and the devaluation of the Real against the Euro, consolidated operating revenues would have increased by 4.2%.

EBITDA amounted to Euro 603 million, equivalent to a 37.6% margin, and income from operations totalled Euro 254 million. As to net income, PT reported a 19.1% increase y.o.y. totalling Euro 166 million. Operating cash flow amounted to Euro 76 million, compared to Euro 304 million in the first quarter of 2008, as a result of the 57.1% increase in capex related to the rollout of the infrastructure of the TV service, 3G and 3.5G investments in Brazil and to higher working capital investment in the first quarter of 2009.

On 31 March 2009, net debt amounted to Euro 5,741 million and after-tax unfunded PRB obligations totalled Euro 1,368 million.

Portugal Telecom announced in a press release that the Board of Directors has approved the intention to submit for shareholders’ approval at the next AGM the payment of a cash dividend of Euro 0.575 per share for the fiscal years ending 31 December 2009, 2010 and 2011.