Azteca Announces Sales of Ps.2,725 Million, and EBITDA of Ps.1,005 for 2Q11

Azteca Announces Sales of Ps.2,725 Million, and EBITDA of Ps.1,005 for 2Q11

--Net Income grows to Ps.394 million during the quarter--

--Continuous strength in audience levels, 42% share for the full day--

MEXICO CITY, July 21, 2011 /PRNewswire/ -- TV Azteca, S.A.B. de C.V. (BMV: AZTECA; Latibex: XTZA), one of the two largest producers of Spanish-language television programming in the world, announced today financial results for the second quarter of 2011.

"The results this quarter are not completely comparable to those of the previous year due to the extraordinary incomes and costs related to the coverage of the Soccer World Cup in 2010," said Mario San Roman, CEO of Azteca. "But beyond the market's cyclical behavior, we continued with positive development in operational results for the period, including further strengthening of audience share, which reached 42% for full day, with appealing content for advertisers."

Second quarter results

Net sales were Ps.2,725 million, compared to Ps.2,859 million for the same quarter of 2010. Total costs and expenses were Ps.1,720 million, 5% below the Ps.1,814 million in the same period of the previous year.

As a result, Azteca reported EBITDA of Ps.1,005 million, compared to Ps.1,045 million in the second quarter of 2010. The EBITDA margin was 37%, unchanged from the prior year. The company registered net income of Ps.394 million, 4% higher than the Ps.380 million from the previous year.

2Q 2010 2Q 2011 Change
Ps. %
--- ---

Net sales $2,859 $2,725 $(134) -5%

EBITDA $1,045 $1,005 $(40) -4%

Net income $380 $394 $14 4%

Net income per CPO $0.13 $0.13 $0 4%
------------------ ----- ----- --- ---

Figures in millions of pesos.
EBITDA: Operating Profit Before Depreciation and Amortization.
The number of CPOs outstanding as of June 30, 2010 was 3,007 million
and as of June 30, 2011 was 3,000 million.

Net sales

"We generated even more successful programming grids, with vibrant content for all time slots, which favored the development of effective marketing campaigns for a wide number of brands, and partially compensated the absence of revenue from last year's World Cup coverage," added Mr. San Roman.

Second quarter revenue includes sales at Azteca America--the company's wholly-owned broadcast television network focused on the U.S. Hispanic market--of Ps.200 million, compared to Ps.205 million a year ago.

Programming sales to other countries were Ps.32 million in the period, compared to Ps.26 million from the previous year. Sales for the quarter included the programs Emperatriz, Cielo Rojo and Pasion Morena, to Central and South America.

Revenue from barter sales was Ps.99 million in the period, from Ps.108 million in the previous year.

Costs and expenses

The 5% reduction in costs and expenses was the result of a 9% decrease in production, programming and transmission costs --to Ps.1,387 million, from Ps.1,519 million in the same period a year ago-- and an increase in selling and administrative expenses --to Ps.333 million, from Ps.296 million in the same quarter of 2010.

The decrease in costs mainly reflects the absence of the World Cup exhibition rights, as well as costs associated to the production of the event.

Selling and administrative expense changes are the result of higher operating expenses, as well as advisory fee payments.

EBITDA and net income

EBITDA was Ps.1,005 million, compared to Ps.1,045 million in the same period of the prior year; the EBITDA margin was 37% this period, constant from the second quarter of 2010.

On a pro forma basis, excluding incomes and costs related to the coverage of the Soccer World Cup in 2010, EBITDA continued its positive performance this quarter.

The main changes below EBITDA were a Ps.41 million decrease in other expenses, as well as a Ps.21 million reduction in comprehensive financing cost, mainly from a more favorable exchange result this period.

Net income for the period was Ps.394 million, 4% higher than the Ps.380 million from a year ago.

Debt

As of June 30, 2011, Azteca's outstanding debt --excluding Ps.1,418 million debt due in 2069--was Ps.9,671 million.

The cash balance of the company was Ps.7,215 million, compared to Ps.3,733 million a year ago.

Net debt was Ps.2,456 million, 37% below the Ps.3,889 million from the previous year. Debt to last twelve months (LTM) EBITDA ratio was 2.1 times, and net debt to LTM EBITDA was 0.5 times.

Six months results

Net sales in the first six months of the year were Ps.5,052 million, compared to Ps.5,081 million of the same period of 2010. Total costs and expenses were Ps.3,270 million, from Ps.3,274 million in the same period a year ago. As a result, Azteca reported EBITDA of Ps.1,782 million, compared to Ps.1,806 million in the first half of the prior year. The EBITDA margin for the six month period was 35%. The company recorded net income of Ps.555 million, 8% above the Ps.512 million for the same period of 2010.

6M 2010 6M 2011 Change
Ps. %
--- ---

Net sales $5,081 $5,052 $(29) -1%

EBITDA $1,806 $1,782 $(24) -1%

Net income $512 $555 $43 8%

Net income per CPO $0.17 $0.19 $0.02 8%
------------------ ----- ----- ----- ---

Figures in millions of pesos.
EBITDA: Operating Profit Before Depreciation and Amortization.
The number of CPOs outstanding as of June 30, 2010 was 3,007 million
and as of June 30, 2011 was 3,000 million.

Company Profile

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. Azteca affiliates include Azteca America Network, a broadcast television network focused on the rapidly growing U.S. Hispanic market, and Azteca Web, an Internet company for North American Spanish speakers.

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: 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 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 June 30 of 2010 and 2011 )

Second Quarter of :
--------------------
2010 2011
---- ----
Change
------

Net revenue Ps 2,859 100% Ps 2,725 100% Ps (134) -5%
--- ----

Programming, production
and transmission costs 1,519 53% 1,387 51% (132) -9%
Selling and
administrative expenses 296 10% 333 12% 38 13%

Total costs and expenses 1,814 63% 1,720 63% (94) -5%
----- ----- ---

EBITDA 1,045 37% 1,005 37% (40) -4%

Depreciation and
amortization 132 124 (8)

Operating profit 913 32% 881 32% (32) -4%
--- --- ---

Other expense -Net (146) (106) 41

Comprehensive financing
result:
Interest expense (213) (211) 1
Other financing expense (26) (25) 1
Interest income 37 34 (3)
Exchange loss -Net (30) (9) 22
(231) (211) 21
---- ---- ---

Income before the
following provision 536 19% 565 21% 29 5%

Provision for income tax (155) (171) (15)

Net income Ps 380 Ps 394 Ps 14
=== === === === === ===

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

Controlling share in net
profit Ps 380 13% Ps 394 14% Ps 14 4%
=== === === === === ===

TV AZTECA, S.A.B. DE C.V. AND SUBSIDIARIES
CONSOLIDATED RESULTS OF OPERATIONS
(Millions of Mexican pesos of June 30 of 2010 and 2011 )

Period ended June 30,
---------------------
2010 2011
---- ----
Change
------

Net revenue Ps 5,081 100% Ps 5,052 100% Ps (29) -1%
--- ---

Programming,
production and
transmission
costs 2,709 53% 2,654 53% (55) -2%
Selling and
administrative
expenses 565 11% 615 12% 51 9%

Total costs and
expenses 3,274 64% 3,270 65% (4) 0%
----- ----- ---

EBITDA 1,806 36% 1,782 35% (24) -1%

Depreciation and
amortization 261 247 (14)

Operating profit 1,546 30% 1,535 30% (11) -1%
----- ----- ---

Other expense -Net (260) (212) 48

Comprehensive
financing result:
Interest expense (423) (406) 17
Other financing
expense (52) (49) 3
Interest income 62 71 9
Exchange Gain
-Net 1 12 10
(412) (373) 39
---- ---- ---

Income before the
following
provision 874 17% 950 19% 76 9%

Provision for
income tax (361) (394) (33)

Net income Ps 513 Ps 556 Ps 43
=== === === === === ===

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

Controlling share
in net profit Ps 512 10% Ps 555 11% Ps 43 8%
=== === === === === ===

TV AZTECA, S.A.B. DE C.V. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Millions of Mexican pesos of June 30 of 2010 and 2011)

At June 30
----------
2010 2011
---- ----
Change
------
Current assets:
Cash and cash equivalents Ps 3,733 Ps 7,215 Ps 3,482
Accounts receivable 4,348 6,163 1,815
Other current assets 2,499 2,296 (203)

Total current assets 10,580 15,674 5,094 48%

Long-term accounts
receivable from Pappas 1,528 1,847 319
Exhibition rights 1,087 1,090 3
Property, plant and
equipment-Net 3,162 3,066 (96)
Television concessions-Net 4,649 4,756 107
Other assets 1,501 1,314 (187)
Goodwill -Net 159 19 (140)
Deferred income tax asset 4,058 4,429 371
Total long term assets 16,144 16,521 377 2%

Total assets Ps 26,724 Ps 32,195 Ps 5,471 20%
== ====== == ====== == =====

Current liabilities:
Short-term debt Ps 1,517 Ps 508 Ps (1,009)
Other current liabilities 2,628 2,235 (393)

Total current liabilities 4,145 2,743 (1,402) -34%

Long-term debt:
Structured Securities
Certificates, Medium Term
Note 6,000 9,163 3,163
Long-term debt 105 - (105)
Total long-term debt 6,105 9,163 3,058
Other long term liabilities:
Advertising advances 5,241 6,844 1,603
American Tower Corporation
(due 2069) 1,516 1,418 (98)
Deferred income tax asset 3,378 3,550 172

Total other long-term
liabilities 10,135 11,812 1,677 17%

Total liabilities 20,385 23,718 3,333 16%

Total stockholders' equity 6,339 8,477 2,138 34%

Total liabilities and equity Ps 26,724 Ps 32,195 Ps 5,471 20%
== ====== == ====== == =====

SOURCE Azteca

Azteca

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

-------
Profile: intent