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Telecinco's January-September 2006 financial results

TELECINCO IMPROVES NET PROFIT BY 7.8% DESPITE
DTT-RELATED COSTS AND INCREASING COMPETITION

Net profit was 229.30 million euros.
The gross operating margin EBITDA, at a record 321.96 million euros, has climbed 3% compared with the same period of 2005
Grupo Publiespaña has beaten its total gross advertising revenue record with 685.08 million euros, an increase of 4.2% over the January-September 2005 period. Net advertising revenue grew by 4.4% to 655.69 million euros.
For the year to date, Telecinco is the audience share leader in terms of total day share (21.3%), prime time share (21.4%), total day share of the commercial target (23.1%) and prime time share of the commercial target (23.8%)

For the January-September period, Telecinco has confirmed its leadership position in terms of audience share, turnover, price, cash flow, market share and margins - an indicator the company has continued to improve despite DTT launch-related costs and increasing competition from new television channels.

At 655.69 million, Telecinco hit a new all-time high for net advertising revenue, which grew by 4.4% compared with the January-September 2005 period.
 
Pre-tax profit leapt from 309.88 million euros in the first nine months of 2005 to 324.62 million euros in 2006, an increase of 4.8%.

Net profit totalled 229.30 million euros, representing an increase of 7.8% on the same period of 2005 (212.63 million euros).

The gross operating margin (adjusted EBITDA) reached 321.96 million euros between January and September, up by 3% on the same period of 2005. The company's EBIT was 317.31 million euros, up 4% on the same period of 2005 (305.23 million euros). This figure brings Telecinco's EBIT-total net revenue margin to 45.3%.

Grupo Publiespaña hits a new record after a 4.2% increase in total gross advertising revenues
Grupo Publiespaña set a new record for total gross advertising revenue with 685.08 million euros, up 4.2% on the same period of 2005. Net advertising revenue improved by 4.4% to 655.69 million euros.

Record results with costs growing in line with inflation
These figures are further proof of Telecinco's efficient business model, based on a transparent commercial management with a product range tailored to each customer and a programming grid designed to achieve audience share leadership and profitability. To obtain these figures, Telecinco has strictly adhered to its cost control policy despite the emergence of new television channels, with costs increasing in line with inflation plus DTT-related charges to 4.7% in total.

Telecinco leads the audience share ranking for the year to date with 21.3%
After the period of change as a result of the new television channels and the broadcast of major sport events, Telecinco is the only channel that has remained above a 20% audience share, both in terms of total day and prime time. 

 
Telecinco has closed the first nine months of the year as the undisputed leader of Spain's television market with a 21.3% audience share, compared with Antena 3's 19.8% and TVE 1's 18.2%. 


The strength of the channel between January and September has also been visible in advertisers' preferred time slot, the prime time (21.00 - 24.00), where Telecinco has obtained a 21.4% audience share, almost two points ahead of Antena 3 (19.6%) and three points ahead of TVE 1 (18.0%).
Regarding the commercial target, Telecinco's leadership position has remained uncontested: the channel achieved a 23.1% share in terms of total day audience, compared with 20.4% for Antena 3 and 14.7% for TVE 1, and 23.8% share in the prime time slot, compared with 20.1% for Antena 3 and 14.7% for TVE 1.

Comments by Paolo Vasile and Giuseppe Tringali, chief executives of Telecinco.
"We started the year aiming to improve our excellent 2005 results and consolidate as the leading television channel in terms of audience share and advertising revenues despite new entrants. Now that we have overcome a challenging first half of the year, when total advertising revenue grew by 3.1%, Telecinco has increased its growth rate to 7.8% in the third quarter, bringing its growth between January and September to 4.2%. A notable contributor has been the Special Initiatives division, which has exceeded 15% of our television-related revenues for the first time, confirming the success of the strategy we implemented five years ago with the introduction of innovative advertising formats giving advertisers more visibility", explained Giuseppe Tringali.

Paolo Vasile said: "We are pleased to bring these results to our shareholders as a proof of our firm determination to work hard for the television and business leadership for which Telecinco has been known for years. The obstacles arising in an evolving environment are a motivation to improve our performance. The significant audience share gap with other television channels, achieved in an environment marked by growing competition without compromising our traditional, strict control of costs, is the result of the work of a team that is deeply committed to the company".

Madrid, October 24, 2006

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