TV Azteca Announces 16% EBITDA Growth to Historical Maximum of Ps.1,816 Million, in 4Q10

TV Azteca Announces 16% EBITDA Growth to Historical Maximum of Ps.1,816 Million, in 4Q10

--Net sales increase 18% to Ps.3,667 million in the quarter--

--4Q net income grows 46% to Ps.1,389 million--

MEXICO CITY, Feb. 24, 2011 /PRNewswire/ -- TV Azteca, S.A.B. de C.V. (BMV: TVAZTCA; Latibex: XTZA), one of the two largest producers of Spanish-language television programming in the world, announced today financial results for the fourth quarter and full year of 2010.

"We generated attractive time slots, through solid programming grids, for successful advertising campaigns that attracted numerous advertisers. This supported revenue growth, leading to record EBITDA for the quarter," commented TV Azteca CEO, Mario San Roman. "Our world class content and solid operations were fundamental in achieving historical maximums in sales, EBITDA and net profit for the year."

Fourth quarter results

Net sales were Ps.3,667 million, 18% above the Ps.3,097 million of the same quarter of 2009. Total costs and expenses were Ps.1,851 million, compared to Ps.1,527 million in the same period of the previous year.

As a result, TV Azteca reported EBITDA of Ps.1,816 million, 16% above the Ps.1,570 million in the fourth quarter of 2009. The EBITDA margin was 50%. The company registered net income of Ps.1,389 million, 46% higher than the Ps.949 million from the previous year.

4Q 2009 4Q 2010 Change
Ps. %
--- ---

Net sales $3,097 $3,667 $570 18%

EBITDA $1,570 $1,816 $246 16%

Net income $949 $1,389 $440 46%

Net income per CPO $0.32 $0.46 $0.14 44%

Figures in millions of pesos.
EBITDA: Operating Profit Before Depreciation and Amortization.
The number of CPOs outstanding as of December 31 2009 was 2,922
million and as of December 31, 2010 was 3,000 million.

Net sales

"Our programming was complemented with vibrant content this period, aimed at meeting the higher seasonal advertising demand for the last part of the year," added Mr. San Roman. "Successful programs, notably La Academia Bicentenario, generated superior positioning options among quality audiences for many brands, further developing income."

Fourth quarter revenue includes sales at Azteca America--the company's wholly-owned broadcast television network focused on the U.S. Hispanic market--of Ps.260 million, 18% higher than the Ps.221 million a year ago.

Revenue from barter sales was Ps.92 million in the period, from Ps.85 million in the previous year.

Costs and expenses

The 21% growth in costs and expenses from Ps.1,527 million to Ps.1,851 million for the quarter resulted from an increase from Ps.1,234 million to Ps.1,530 million in production, programming and transmission costs and an increase from Ps.293 million to Ps.321 million in selling and administrative expenses.

The growth in costs mainly derives from the costs of producing content --that attracted significant audiences-- considering the higher seasonal demand registered for the end of the year.

The selling and administrative expenses results are due to higher personnel and operative expenses related to the growing operations of the company.

EBITDA and net income

EBITDA was Ps.1,816 million, a historical maximum for a fourth quarter, 16% above the Ps.1,570 million for the same period of the prior year.

The main changes below EBITDA were i) a Ps.159 million decrease in other expenses, as a result of lower legal expenses, as well as the reduction of preoperative expenses and donations, and ii) a Ps.75 million reduction in tax provisions.

Net income for the period was Ps.1,389 million, 46% higher than the Ps.949 million from a year ago.

Debt

As of December 31, 2010, TV Azteca's outstanding debt --excluding Ps.1,480 million debt due in 2069--was Ps.7,979 million, compared to Ps.7,607 million a year ago, this amount is denominated in Mexican pesos, congruent with most of the company income.

The cash balance of the company was Ps.5,003 million, 29% higher than the Ps.3,886 million a year ago.

Net debt was Ps.2,976 million, 20% lower than the Ps.3,721 million from the previous year. Debt to last twelve months (LTM) EBITDA ratio was 1.7 times, and net debt to LTM EBITDA was 0.6 times.

Twelve months results

Net sales of the year were Ps.11,554 million, a historical maximum, and 16% above the Ps.9,968 million of the same period of 2009. Total costs and expenses were Ps.6,831 million, from Ps.5,845 million in the same period a year ago, mainly derived from costs related to the World Cup transmission this year. As a result, TV Azteca reported record EBITDA of Ps.4,723 million, 15% higher than the Ps.4,122 million in the prior year. The EBITDA margin for the period was 41%, without changes compared to last year. The company recorded net income of Ps.2,317 million, 65% above the Ps.1,401 million of last year.

2009 2010 Change
Ps. %
--- ---

Net sales $9,968 $11,554 $1,586 16%

EBITDA $4,122 $4,723 $601 15%

Net income $1,401 $2,317 $917 65%

Net income per CPO $0.48 $0.77 $0.29 60%

Figures in millions of pesos.
EBITDA: Operating Profit Before Depreciation and Amortization.
The number of CPOs outstanding as of December 31, 2009 was 2,922
million and as of December 31, 2010 was 3,000 million.

Company Profile

TV Azteca is one of the two largest producers of Spanish-language television programming in the world, operating two national television networks in Mexico, Azteca 13 and Azteca 7, through more than 300 owned and operated stations across the country. TV Azteca affiliates include Azteca America Network, a new broadcast television network focused on the rapidly growing U.S. Hispanic market, and Azteca Web, an Internet company for Spanish speakers.

TV Azteca is a Grupo Salinas company (www.gruposalinas.com), a group of dynamic, fast-growing, and technologically advanced companies focused on creating shareholder value, contributing to build the middle class of the countries in which they operate, and improving society through excellence. Created by Mexican entrepreneur Ricardo B. Salinas (www.ricardosalinas.com), Grupo Salinas operates a as a management development and decision forum for the top leaders of member companies. The companies include: TV Azteca (www.irtvazteca.com), Azteca America (www.aztecaamerica.com), Grupo Elektra (www.grupoelektra.com.mx), Banco Azteca (www.bancoazteca.com.mx), Afore Azteca (www.aforeazteca.com.mx), Seguros Azteca (www.segurosazteca.com.mx) and Grupo Iusacell (www.iusacell.com). Each of the Grupo Salinas companies operates independently, with its own management, board of directors and shareholders. Grupo Salinas has no equity holdings. However, member companies share a common vision, values and strategies for achieving rapid growth, superior results and world-class performance.

Except for historical information, the matters discussed in this press release are forward-looking statements and are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Other risks that may affect TV Azteca and its subsidiaries are identified in documents sent to securities authorities.

Investor Relations:
Bruno Rangel Carlos Casillas
+ 52 (55) 1720 9167 + 52 (55) 1720 0041
jrangelk@tvazteca.com.mx cjcasillas@tvazteca.com.mx

Press Relations:
Tristan Canales Daniel McCosh
+ 52 (55) 1720 1441 + 52 (55) 1720 0059
tcanales@gruposalinas.com.mx dmccosh@tvazteca.com.mx

TV AZTECA, S.A.B DE C.V. AND SUBSIDIARIES
CONSOLIDATED RESULTS OF OPERATIONS
(Millions of Mexican pesos of December 31 of 2009 and 2010 )

Fourth Quarter of :
--------------------
2009 2010
---- ----

Net revenue Ps 3,097 100% Ps 3,667 100%

Programming, production and
transmission costs 1,234 40% 1,530 42%
Selling and administrative
expenses 293 9% 321 9%
Total costs and expenses 1,527 49% 1,851 50%
--- ---

EBITDA 1,570 51% 1,816 50%

Depreciation and amortization 129 134

Operating profit 1,441 47% 1,682 46%
--- ---

Other expense -Net (270) (111)

Comprehensive financing
result:
Interest expense (211) (226)
Other financing expense (14) (40)
Interest income 19 18
Exchange Gain -Net 93 101
(112) (147)
---- ----

Income before the following
provision 1,059 34% 1,424 39%

Provision for income tax (109) (34)

Net income Ps 950 Ps 1,390
=== === ===

Non-controlling share in net
profit Ps 1 Ps 0
=== === === ===

Controlling share in net
profit Ps 949 31% Ps 1,389 38%
--- --- --- -----

Change
------

Net revenue Ps 570 18%
--- -

Programming, production and
transmission costs 297 24%
Selling and administrative
expenses 27 9%

Total costs and expenses 324 21%
-

EBITDA 246 16%

Depreciation and amortization 5

Operating profit 241 17%
-

Other expense -Net 159

Comprehensive financing
result:
Interest expense (15)
Other financing expense (26)
Interest income (1)
Exchange Gain -Net 7
(35)
---

Income before the following
provision 365 34%

Provision for income tax 75

Net income Ps 440
=== =

Non-controlling share in net
profit Ps (0)
=== ===

Controlling share in net
profit Ps 440 46%
--- ---

TV AZTECA, S.A.B DE C.V. AND SUBSIDIARIES
CONSOLIDATED RESULTS OF OPERATIONS
(Millions of Mexican pesos of December 31 of 2009 and 2010 )

Period ended December 31,
-------------------------
2009 2010
---- ----

Net revenue Ps 9,968 100% Ps 11,554 100%

Programming, production and
transmission costs 4,761 48% 5,646 49%
Selling and administrative
expenses 1,084 11% 1,185 10%
Total costs and expenses 5,845 59% 6,831 59%
----- -----

EBITDA 4,122 41% 4,723 41%

Depreciation and amortization 509 528

Operating profit 3,613 36% 4,196 36%
----- -----

Other expense -Net (800) (604)

Comprehensive financing
result:
Interest expense (876) (866)
Other financing expense (65) (116)
Interest income 68 109
Exchange Gain -Net 25 106
(849) (767)
---- ----

Income before the following
provision 1,965 20% 2,824 24%

Provision for income tax (563) (505)

Net income Ps 1,402 Ps 2,319
=== ===== === =====

Non-controlling share in net
profit Ps 1 Ps 1
=== === === ===

Controlling share in net
profit Ps 1,401 14% Ps 2,317 20%
--- ----- --- -----

Change
------

Net revenue Ps 1,586 16%
--- -----

Programming, production and
transmission costs 885 19%
Selling and administrative
expenses 100 9%

Total costs and expenses 985 17%
---

EBITDA 601 15%

Depreciation and amortization 19

Operating profit 582 16%
---

Other expense -Net 196

Comprehensive financing
result:
Interest expense 10
Other financing expense (50)
Interest income 41
Exchange Gain -Net 81
81
---

Income before the following
provision 859 44%

Provision for income tax 57

Net income Ps 917
=== ===

Non-controlling share in net
profit Ps (0)
=== ===

Controlling share in net
profit Ps 917 65%
--- ---

TV AZTECA, S.A.B DE C.V. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Millions of Mexican pesos of December 31 of 2009 and 2010 )

At December 31
--------------
2009 2010
---- ----

Current assets:
Cash and cash equivalents Ps 3,886 Ps 5,003
Accounts receivable 4,636 4,820
Other current assets 2,731 1,931

Total current assets 11,253 11,754

Long-term accounts receivable from
Pappas 2,011 1,927
Exhibition rights 204 865
Property, plant and equipment-Net 3,049 3,123
Television concessions-Net 4,648 4,648
Other assets 968 1,113
Goodwill -Net 159 -
Deferred income tax asset 3,806 4,410
Total long term assets 14,845 16,086

Total assets Ps 26,098 Ps 27,840
== ====== == ======

Current liabilities:
Short-term debt Ps 1,607 Ps 1,769
Other current liabilities 2,815 2,679

Total current liabilities 4,422 4,448

Long-term debt:
Structured Securities Certificates 6,000 5,944
Long-term debt - 266
Total long-term debt 6,000 6,210
Other long term liabilities:
Advertising advances 4,604 4,401
American Tower Corporation (due
2069) 1,564 1,480
Deferred income tax asset 3,378 3,378

Total other long-term liabilities 9,546 9,259

Total liabilities 19,968 19,917

Total stockholders' equity 6,130 7,923

Total liabilities and equity Ps 26,098 Ps 27,840
-- ------ -- ------

Change
------

Current assets:
Cash and cash equivalents Ps 1,117
Accounts receivable 184
Other current assets (800)

Total current assets 501 4%

Long-term accounts receivable from
Pappas (84)
Exhibition rights 661
Property, plant and equipment-Net 74
Television concessions-Net -
Other assets 145
Goodwill -Net (159)
Deferred income tax asset 604
Total long term assets 1,241 8%

Total assets Ps 1,742 7%
== =====

Current liabilities:
Short-term debt Ps 162
Other current liabilities (136)

Total current liabilities 26 1%

Long-term debt:
Structured Securities Certificates (56)
Long-term debt 266
Total long-term debt 210
Other long term liabilities:
Advertising advances (203)
American Tower Corporation (due
2069) (84)
Deferred income tax asset -

Total other long-term liabilities (287) -3%

Total liabilities (51) 0%

Total stockholders' equity 1,793 29%

Total liabilities and equity Ps 1,742 7%
-- -----

SOURCE TV Azteca, S.A.B. de C.V.

TV Azteca, S.A.B. de C.V.

CONTACT: Investor Relations: Bruno Rangel, +011-52-55-1720-9167, jrangelk@tvazteca.com.mx, or Carlos Casillas, +011-52-55-1720-0041, cjcasillas@tvazteca.com.mx, both of TV Azteca; or Press Relations: Tristan Canales, +011-52-55-1720-1441, tcanales@gruposalinas.com.mx, or Daniel McCosh, +011-52-55-1720-0059, dmccosh@tvazteca.com.mx

Web Site: http://www.gruposalinas.com

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