##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 20-F
 o
    
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
 OR
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2005
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 OR
 o
    
    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Date
of event requiring this shell company report
 FOR THE TRANSITION PERIOD FROM  TO
  
 Grupo Televisa, S.A.
  N/A
 United Mexican States
 Av. Vasco de Quiroga No. 2000
Colonia Santa Fe
01210 Mexico, D.F.
Mexico
 
  Title of each class
    
    Name of each exchange on which registeredA Shares, without par value (A Shares)
    
    New York Stock Exchange (for listing purposes only)B Shares, without par value (B Shares)
    
    New York Stock Exchange (for listing purposes only)L Shares, without par value (L Shares)
    
    New York Stock Exchange (for listing purposes only)Dividend Preferred Shares, without par value (D Shares)
    
    New York Stock Exchange (for listing purposes only)Global Depositary Shares (GDSs), each representing
twenty Ordinary Participation Certificates (Certificados
de Participación Ordinarios)(CPOs)
    
    New York Stock ExchangeCPOs, each representing twenty-five A Shares, twenty-two
B Shares thirty-five L Shares and thirty-five D Shares
    
    New York Stock Exchange (for listing purposes only)
     
 
 þ o
 o þ
 þ o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
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##### Table of Contents



TABLE OF CONTENTS
 PART 1Item 1.
    
    Identity of Directors, Senior Management and Advisers
    
    
    1Item 2.
    
    Offer Statistics and Expected Timetable
    
    
    1Item 3.
    
    Key Information
    
    
    1Selected Financial Data
    
    
    1The Recapitalization
    
    
    3Dividends
    
    
    5Exchange Rate Information
    
    
    6Risk Factors
    
    
    7Forward-Looking Statements
    
    
    18Item 4.
    
    Information on the Company
    
    
    19History and Development of the Company
    
    
    19Capital Expenditures
    
    
    19Business Overview
    
    
    21Item 5.
    
    Operating and Financial Review and Prospects
    
    
    60Preparation of Financial Statements
    
    
    60Results of Operations
    
    
    60Item 6.
    
    Directors, Senior Management and Employees
    
    
    92Item 7.
    
    Major Shareholders and Related Party Transactions
    
    
    104The Principal Shareholders and Related Party Transactions
    
    
    104Item 8.
    
    Financial Information
    
    
    112Item 9.
    
    The Offer and Listing
    
    
    112Trading History of CPOs and GDSs
    
    
    112Trading on the Mexican Stock Exchange
    
    
    114Item 10.
    
    Additional Information
    
    
    118Mexican Securities Market Law
    
    
    118Bylaws
    
    
    120Enforceability of Civil Liabilities
    
    
    130Material Contracts
    
    
    130Legal Proceedings
    
    
    131New York Stock Exchange Corporate Governance Standards
    
    
    133Exchange Controls
    
    
    134Taxation
    
    
    134Documents on Display
    
    
    139Item 11.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    140Item 12.
    
    Description of Securities Other than Equity Securities
    
    
    143PART IIItem 13.
    
    Defaults, Dividend Arrearages and Delinquencies
    
    
    143Item 14.
    
    Material Modifications to the Rights of Security Holders and Use of Proceeds
    
    
    143Item 15.
    
    Controls and Procedures
    
    
    143Item 16A.
    
    Audit Committee Financial Expert
    
    
    143Item 16B.
    
    Code of Ethics
    
    
    144Item 16C.
    
    Principal Accountant Fees and Services
    
    
    144Item 16D.
    
    Exemptions from the Listing Standards for Audit Committees
    
    
    145Item 16E.
    
    Purchases of Equity Securities by the Issuer and Affiliated Purchasers
    
    
    145PART IIIItem 17.
    
    Financial Statements
    
    
    146
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Item 18.
    
    Financial Statements
    
    
    146Item 19.
    
    Exhibits
    
    
    146EX-2.8: NINTH SUPPLEMENTAL INDENTUREEX-4.7: PROGRAM LICENSE AGREEMENTEXEX-4.9: ENGLISH TRANSLATION OF INVESTMENT AGREEMENTEX-4.13: SUMMARY OF PS 2,100.0 MILLION CREDIT AGREEMENTEX-4.14: SUMMARY OF PS 1,400.0 MILLION CREDIT AGREEMENTEX-8.1: SUBSIDIARIESEX-12.1: CERTIFICATIONEX-12.2: CERTIFICATIONEX-13.1: CERTIFICATIONEX-13.2: CERTIFICATION
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##### Table of Contents



Part I
 
 Item 1. Identity of Directors, Senior Management and Advisers
  
 Item 2. Offer Statistics and Expected Timetable
  
 Item 3. Key Information
 
 Selected Financial Data
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##### Table of Contents



Year Ended December 31,2001
    
    2002
    
    2003
    
    2004
    
    2005
    
    2005(Millions of Pesos in purchasing power as of December 31, 2005 or millions of U.S. Dollars)(1)(Mexican GAAP)Income Statement Data:Net sales
    
    Ps.
    23,492
    
    
    Ps.
    24,366
    
    
    Ps.
    25,612
    
    
    Ps.
    30,291
    
    
    Ps.
    32,481
    
    
    
    U.S.$3,057Operating income
    
    
    4,904
    
    
    
    5,256
    
    
    
    6,572
    
    
    
    8,843
    
    
    
    10,803
    
    
    
    1,017Integral cost of financing, net(2)
    
    
    493
    
    
    
    692
    
    
    
    668
    
    
    
    1,567
    
    
    
    1,782
    
    
    
    168Restructuring and non-recurring charges(3)
    
    
    649
    
    
    
    952
    
    
    
    714
    
    
    
    408
    
    
    
    230
    
    
    
    22Income (loss) from continuing operations
    
    
    1,707
    
    
    
    (445
    )
    
    
    3,847
    
    
    
    5,756
    
    
    
    7,716
    
    
    
    726Income (loss) from discontinued operations(4)
    
    
    17
    
    
    
    1,201
    
    
    
    (70
    )
    
    
    
    
    
    
    
    
    
    
    Cumulative effect of accounting change, net
    
    
    (83
    )
    
    
    
    
    
    
    
    
    
    
    (1,056
    )
    
    
    (506
    )
    
    
    (48
    )Net income
    
    
    1,608
    
    
    
    834
    
    
    
    3,909
    
    
    
    4,461
    
    
    
    6,126
    
    
    
    576Income (loss) from continuing operations per CPO(5)
    
    
    0.59
    
    
    
    (0.12
    )
    
    
    1.38
    
    
    
    1.89
    
    
    
    2.28
    
    
    
    Net income per CPO(5)
    
    
    0.56
    
    
    
    0.29
    
    
    
    1.36
    
    
    
    1.53
    
    
    
    2.11
    
    
    
    Weighted-average number of shares outstanding (in millions)(5)
    
    
    354,485
    
    
    
    353,906
    
    
    
    352,421
    
    
    
    345,206
    
    
    
    341,158
    
    
    
    Cash
Dividend per CPO
    
    
    
    
    
    
    
    
    
    
    0.21
    
    
    
    1.30
    
    
    
    1.38
    
    
    
    Shares outstanding (in millions, at year end)(6)
    
    
    221,400
    
    
    
    221,210
    
    
    
    218,840
    
    
    
    341,638
    
    
    
    339,941
    
    
    
    (U.S. GAAP)(7)Income Statement Data:Net sales
    
    Ps.
    24,672
    
    
    Ps.
    24,600
    
    
    Ps.
    25,612
    
    
    Ps.
    30,291
    
    
    Ps.
    32,481
    
    
    
    U.S.$3,057Operating income
    
    
    2,771
    
    
    
    3,404
    
    
    
    6,566
    
    
    
    8,101
    
    
    
    10,009
    
    
    
    942Income from continuing operations
    
    
    2,493
    
    
    
    114
    
    
    
    3,240
    
    
    
    4,410
    
    
    
    6,825
    
    
    
    642Cumulative effect of accounting change, net
    
    
    (939
    )
    
    
    (1,393
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net income (loss)
    
    
    1,554
    
    
    
    (1,280
    )
    
    
    3,240
    
    
    
    4,410
    
    
    
    6,825
    
    
    
    642Income from continuing operations per CPO(5)
    
    
    1.04
    
    
    
    0.04
    
    
    
    1.12
    
    
    
    1.49
    
    
    
    2.34
    
    
    
    Net income (loss) per CPO(5)
    
    
    0.53
    
    
    
    (0.43
    )
    
    
    1.12
    
    
    
    1.49
    
    
    
    2.34
    
    
    
    Weighted-average number of Shares outstanding (in millions)(6)
    
    
    354,485
    
    
    
    353,906
    
    
    
    352,421
    
    
    
    345,573
    
    
    
    341,158
    
    
    
    Shares outstanding (in millions, at year end)(6)
    
    
    221,400
    
    
    
    221,210
    
    
    
    218,840
    
    
    
    341,638
    
    
    
    339,941
    
    
    
    (Mexican GAAP)Balance Sheet Data (end of year):Cash and temporary investments
    
    Ps.
    6,720
    
    
    Ps.
    9,930
    
    
    Ps.
    13,330
    
    
    Ps.
    17,196
    
    
    Ps.
    14,778
    
    
    
    U.S.$1,391Total assets
    
    
    58,775
    
    
    
    63,759
    
    
    
    70,391
    
    
    
    76,385
    
    
    
    74,852
    
    
    
    7,044Current notes payable to banks and other notes payable(8)
    
    
    400
    
    
    
    1,400
    
    
    
    310
    
    
    
    3,407
    
    
    
    340
    
    
    
    32Long-term debt(9)
    
    
    15,316
    
    
    
    15,083
    
    
    
    15,982
    
    
    
    19,575
    
    
    
    18,137
    
    
    
    1,707Customer deposits and advances
    
    
    12,903
    
    
    
    13,282
    
    
    
    15,222
    
    
    
    15,813
    
    
    
    18,046
    
    
    
    1,698Capital stock issued
    
    
    8,606
    
    
    
    8,606
    
    
    
    8,921
    
    
    
    9,889
    
    
    
    9,889
    
    
    
    931Total stockholders equity (including minority interest)
    
    
    22,374
    
    
    
    24,100
    
    
    
    29,920
    
    
    
    28,524
    
    
    
    29,864
    
    
    
    2,810(U.S. GAAP)(7)Balance Sheet Data (end of year):Property, plant and equipment, net
    
    Ps.
    17,014
    
    
    Ps.
    17,180
    
    
    Ps.
    16,559
    
    
    Ps.
    19,453
    
    
    Ps.
    19,308
    
    
    
    U.S.$1,817Total assets
    
    
    61,160
    
    
    
    63,704
    
    
    
    73,549
    
    
    
    85,099
    
    
    
    82,179
    
    
    
    7,733Current notes payable to banks and other notes payable(8)
    
    
    400
    
    
    
    1,400
    
    
    
    310
    
    
    
    3,407
    
    
    
    340
    
    
    
    32Long-term debt(9)
    
    
    15,316
    
    
    
    15,083
    
    
    
    15,982
    
    
    
    19,575
    
    
    
    18,137
    
    
    
    1,707Total stockholders equity (excluding minority interest)
    
    
    21,383
    
    
    
    19,956
    
    
    
    26,286
    
    
    
    27,018
    
    
    
    28,333
    
    
    
    2,666(Mexican GAAP)Other Financial Information:Capital expenditures
    
    Ps.
    1,589
    
    
    Ps.
    1,600
    
    
    Ps.
    1,157
    
    
    Ps.
    2,012
    
    
    Ps.
    2,639
    
    
    
    U.S.$248(U.S. GAAP)(7)Other Financial Information:Cash provided by operating activities
    
    
    1,744
    
    
    
    6,335
    
    
    
    6,836
    
    
    
    7,077
    
    
    
    10,265
    
    
    
    966Cash provided by (used for) financing activities
    
    
    2,429
    
    
    
    422
    
    
    
    (2,880
    )
    
    
    (540
    )
    
    
    (9,278
    )
    
    
    (873
    )Cash used for investing activities
    
    
    (6,560
    )
    
    
    (3,382
    )
    
    
    (2,362
    )
    
    
    (735
    )
    
    
    (2,216
    )
    
    
    (209
    )Other Data (unaudited):Average prime time audience share (TV broadcasting)(10)
    
    
    70.5
    %
    
    
    72.4
    %
    
    
    70.1
    %
    
    
    68.9
    %
    
    
    68.5
    %
    
    
    Average prime time rating (TV broadcasting)(10)
    
    
    39.1
    
    
    
    39.6
    
    
    
    38.1
    
    
    
    36.7
    
    
    
    36.5
    
    
    
    Magazine circulation (millions of copies)(11)
    
    
    132
    
    
    
    137
    
    
    
    128
    
    
    
    127
    
    
    
    145
    
    
    
    Number of employees (at year end)
    
    
    13,700
    
    
    
    12,600
    
    
    
    12,300
    
    
    
    14,100
    
    
    
    15,100
    
    
    
    Number of Innova subscribers (in thousands at year end)(12)
    
    
    716
    
    
    
    738
    
    
    
    857
    
    
    
    1,003
    
    
    
    1,251
    
    
    
    Number of Cablevisión subscribers (in thousands at year end)(13)
    
    
    452
    
    
    
    412
    
    
    
    364
    
    
    
    355
    
    
    
    422
    
    
    
    Number of EsMas.comregistered users (in thousands at year
end)(14)
    
    
    866
    
    
    
    2,514
    
    
    
    3,085
    
    
    
    3,665
    
    
    
    4,212
    
    
    
    
 
 Notes to Selected Consolidated Financial Information:(1)
    
    Except per CPO, ratio, average audience share, average rating, magazine circulation,
employee, subscriber and registered user data. Information in these footnotes is in thousands
of Pesos in purchasing power as of December 31, 2005, unless otherwise indicated.(2)
    
    Includes interest expense, interest income, foreign exchange gain or loss, net and gain or
loss from monetary position. See Note 17 to our year-end financial statements. - 2 -




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(3)
    
    See Note 18 to our year-end financial statements.(4)
    
    See Note 1(s) to our year-end financial statements.(5)
    
    For further analysis of income (loss) from continuing operations per CPO and net income per
CPO (as well as corresponding amounts per A Share not traded as CPOs), see Note 21 (for the
calculation under Mexican GAAP) and Note 24 (for the calculation under U.S. GAAP) to our
year-end financial statements.(6)
    
    As of December 31, 2004 and 2005, we had four classes of common stock: A Shares, B Shares, D
Shares and L Shares. As of December 31, 2003, we had three classes of common stock: A Shares,
D Shares and L Shares. For purposes of this table, the weighted-average number of shares for
all periods reflects the 25-for-one stock split and the 14-for-one stock dividend from the
2004 Recapitalization, and the number of shares outstanding for all periods reflects the
25-for-one stock split from the 2004 Recapitalization. Our shares are publicly traded in
Mexico, primarily in the form of CPOs, each CPO representing 117 shares comprised of 25 A
Shares, 22 B Shares, 35 D Shares and 35 L Shares; and in the United States in the form of
Global Depositary Shares, or GDS, each GDS representing 20 CPOs. Effective on March 22, 2006,
each GDS is represented by five CPOs.   (7)
    
    See Note 24 to our year-end financial statements.(8)
    
    Current notes payable to banks and other notes payable include Ps.15.3 million and Ps.8.0
million of other notes payable as of December 31, 2001 and 2002, respectively. As of December
31, 2003, 2004 and 2005, there are no other notes payable outstanding. See Note 8 to our
year-end financial statements.(9)
    
    As of December 31, 2002, 2003, 2004 and 2005, there are no other long-term notes payable. See
Operating and Financial Review and Prospects  Results of Operations  Liquidity, Foreign
Exchange and Capital Resources  Indebtedness and Note 8 to our year-end financial
statements.(10)
    
    Average prime time audience share for a period refers to the average daily prime time
audience share for all of our networks and stations during that period, and average prime
time rating for a period refers to the average daily rating for all of our networks and
stations during that period, each rating point representing one percent of all television
households. As used in this annual report, prime time in Mexico is 4:00 p.m. to 11:00 p.m.,
seven days a week, and weekday prime time is 7:00 p.m. to 11:00 p.m., Monday through Friday.
Data for all periods reflects the average prime time audience share and ratings nationwide as
published by IBOPE Mexico. For further information regarding audience share and ratings
information and IBOPE Mexico, see Information on the Company  Business Overview  Television
 Television Broadcasting.(11)
    
    The figures set forth in this line item represent total circulation of magazines that we
publish independently and through joint ventures and other arrangements and do not represent
magazines distributed on behalf of third parties.(12)
    
    Innova, S. de R.L. de C.V., or Innova, our direct to home, or DTH satellite service in
Mexico, referred to alternatively as Sky Mexico for segment reporting purposes, commenced
operations on December 15, 1996. The figures set forth in this line item represent the total
number of gross active residential and commercial subscribers for Innova at the end of each
year presented. Our share in the results of operations of Innova through December 31, 2000 was
included in our income statement under the line item Equity in results of affiliates. For a
description of Innovas business and results of operations and financial condition, see
Information on the Company  Business Overview  DTH
Joint Ventures  Mexico. Under Mexican GAAP, effective January 1, 2001 and through March 31, 2004, we did not recognize
equity in results in respect of our investment in Innova in our income statement. See
Operating and Financial Review and Prospects  Results of
Operations  Equity in Earnings of
Affiliates. Since April 1, 2004, Innova has been consolidated in our financial results.(13)
    
    The figures set forth in this line item represent the total number of subscribers for
Cablevisións basic service package at the end of each year presented. For a description of
Cablevisións business and results of operations and financial condition, see  Operating and
Financial Review and Prospects  Results of Operations  Cable Television and Information on
the Company  Business Overview  Cable Television.(14)
    
    We launched EsMas.comin May 2000. Since May 2000, the results of operations of EsMas.com
have been included in the results of operations of our Other Businesses segment. See
Operating and Financial Review and Prospects Results of Operations  Other Businesses. For
a description of EsMas.com,see Information on the Company  Business Overview  Other
Businesses  Total Segment Results  EsMas.com. The figures set forth in this line item represent the number of
registered users in each year presented. The term registered user means a visitor that has
completed a profile questionnaire that enables the visitor to use the e-mail service provided
by EsMas.com. 
 The Recapitalization
  
    
    a stock split in which each outstanding Share was divided into 25 Shares of the same class;
    
    the creation of a new class of common or ordinary shares, the B Shares;
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
    
    a stock dividend in which we distributed to holders of outstanding Shares, 14 new
Shares (of various classes depending on the class held) for every 25 Shares outstanding
after the stock split;
    
    an increase in the number of Shares represented by each outstanding CPO, from three
Shares to 117 Shares; and
    
    amendments to our bylaws related to these transactions.
 The Stock Split and Stock Dividend
   Before the
    
    After the Stock
    
    14 New Shares DistributedRecapitalization
    
    Split
    
    Per 25 Shares (post-split)
    
    After the RecapitalizationOne A Share
    
    25 A Shares
    
    Four B Shares, Five D
Shares and Five L Shares
    
    25 A Shares, Four B
Shares, Five D Shares and
Five L SharesOne D Share
    
    25 D Shares
    
    Nine B Shares, Five D Shares
    
    Nine B Shares, 30 D SharesOne L Share
    
    25 L Shares
    
    Nine B Shares, Five L Shares
    
    Nine B Shares, 30 L Shares
  Before the Recapitalization
    
    After the Recapitalization(% of total
    
    (% of total
    
    
    
    
    
    (% of total
    
    (% of total(millions)
    
    capital stock)
    
    voting stock)
    
    (millions)
    
    capital stock)
    
    voting stock)Series A
    
    
    4,989
    
    
    
    52.69
    
    
    
    100.00
    %
    
    
    124,736
    
    
    
    33.78
    
    
    
    67.42Series B
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    60,270
    
    
    
    16.32
    
    
    
    32.58Series D
    
    
    2,240
    
    
    
    23.65
    
    
    
    
    
    
    
    92,134
    
    
    
    24.95
    
    
    
    Series L
    
    
    2,240
    
    
    
    23.65
    
    
    
    
    
    
    
    92,134
    
    
    
    24.95
    
    
    
    Total
    
    
    9,469
    
    
    
    100.00
    %
    
    
    100.00
    %
    
    
    369,273
    
    
    
    100.00
    %
    
    
    100.00
    %
 Effect of the Recapitalization on A Shares, D Shares and L Shares
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Effect of the Recapitalization on CPOs
    Effect of the Recapitalization on GDSs
  Delivery of New Shares
   The B Shares
   
 Dividends
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Exchange Rate Information
   High
    
    Low
    
    Average(1)
    
    Period EndPeriod2001
    
    
    9.972
    
    
    
    8.946
    
    
    
    9.334
    
    
    
    9.1562002
    
    
    10.425
    
    
    
    9.001
    
    
    
    9.663
    
    
    
    10.4252003
    
    
    11.406
    
    
    
    10.113
    
    
    
    10.793
    
    
    
    11.2422004
    
    
    11.635
    
    
    
    10.805
    
    
    
    11.290
    
    
    
    11.1542005
    
    
    11.411
    
    
    
    10.413
    
    
    
    10.894
    
    
    
    10.628December
    
    
    10.773
    
    
    
    10.414
    
    
    
    10.627
    
    
    
    10.6282006:January
    
    
    10.643
    
    
    
    10.437
    
    
    
    10.542
    
    
    
    10.440February
    
    
    10.529
    
    
    
    10.432
    
    
    
    10.484
    
    
    
    10.454March
    
    
    10.948
    
    
    
    10.462
    
    
    
    10.749
    
    
    
    10.898April
    
    
    11.160
    
    
    
    10.856
    
    
    
    11.049
    
    
    
    11.089May
    
    
    11.305
    
    
    
    10.841
    
    
    
    11.091
    
    
    
    11.288June
(through June 27)
    
    
    11.460
    
    
    
    11.282
 
 (1)
    
    Annual average rates reflect the average of the exchange rates on the last day of each
month during the relevant period.    - 6 -




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Risk Factors
 The following is a discussion of risks associated with our company and an investment in our
securities. Some of the risks of investing in our securities are general risks associated with
doing business in Mexico. Other risks are specific to our business. The discussion below contains
information, among other things, about the Mexican government and the Mexican economy obtained from
official statements of the Mexican government as well as other public sources. We have not
independently verified this information. Any of the following risks, if they actually occur, could
materially and adversely affect our business, financial condition, results of operations or the
price of our securities.
 Risk Factors Related to Mexico
 Economic and Political Developments in Mexico May Adversely Affect Our Business
  Mexico Has Experienced Adverse Economic Conditions
   
    
    demand for advertising may decrease both because consumers may reduce expenditures
for our advertisers products and because advertisers may reduce advertising
expenditures; and
    
    demand for publications, cable television, DTH satellite services, pay-per-view
programming and other services and products may decrease because consumers may find it
difficult to pay for these services and products.
 Developments in Other Emerging Market Countries or in the U.S. May Affect Us and the Prices
for Our Securities
   - 7 -




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Military Operations in Iraq and Elsewhere Have Negatively Affected Industry and Economic
Conditions Globally, and These Conditions Have Had, and May Continue to Have, a Negative Effect on
Our Business
  Currency Fluctuations or the Devaluation and Depreciation of the Peso Could Limit the Ability
of Our Company and Others to Convert Pesos into U.S. Dollars or Other Currencies Which Could
Adversely Affect Our Business, Financial Condition or Results of Operations
   High Inflation Rates in Mexico May Decrease Demand for Our Services While Increasing Our Costs
  - 8 -




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##### Table of Contents




    
    inflation can adversely affect consumer purchasing power, thereby adversely
affecting consumer and advertiser demand for our services and products;
    
    to the extent inflation exceeds our price increases, our prices and revenues will be
adversely affected in real terms; and
    
    if the rate of Mexican inflation exceeds the rate of depreciation of the Peso
against the U.S. Dollar, our U.S. Dollar-denominated sales will decrease in relative
terms when stated in constant Pesos.
 High Interest Rates in Mexico Could Increase Our Financing Costs
  Political Events in Mexico Could Affect Mexican Economic Policy and Our Business, Financial
Condition and Results of Operations
 Partido Acción Nacional
 Partido de la
Revolución Democrática Partido Acción Nacional Partido Revolucionario Institucional
  Mexican Antitrust Laws May Limit Our Ability to Expand Through Acquisitions or Joint Ventures
  - 9 -




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##### Table of Contents



Comisión
Federal de Competencia
 Changes in Existing Mexican Laws and Regulations or the Imposition of New Ones May Negatively
Affect Our Operations and Revenue
  Ley Federal de Competencia Económica
 Ley Federal de Radio y Televisión Ley Federal de
Telecomunicaciones
 Differences Between Mexican GAAP and U.S. GAAP May Have an Impact on the Presentation of Our
Financial Information
  - 10 -




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Risk Factors Related to Our Major Shareholders
 Emilio Azcárraga Jean has Substantial Influence Over Our Management and the Interests of Mr.
Azcárraga Jean may Differ from Those of Other Shareholders
  As Controlling Shareholder, Emilio Azcárraga Jean Will Have the Ability to Limit Our Ability
to Raise Capital, Which Would Require Us to Seek Other Financing Arrangements
  Risk Factors Related to Our Business
 The Operation of Our Business May Be Terminated or Interrupted if the Mexican Government Does
Not Renew or Revokes Our Broadcast or Other Concessions
 Secretaría de Comunicaciones y Transportes Ley
Federal de Radio y Televisión Ley Federal de Telecomunicaciones
 We Face Competition in Each of Our Markets That We Expect Will Intensify
  - 11 -




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The Seasonal Nature of Our Business Affects Our Revenue and a Significant Reduction in Fourth
Quarter Net Sales Could Impact Our Results of Operations
  Future Activities Which We May Wish to Undertake in the United States May Be Affected by Our
Arrangements With Univision. These Activities, as Well as a Current Dispute We Are Having With
Univision and Univisions Recent Agreement to Sell Univision, May Affect Our Relationship With,
and Our Interest in, Univision
   Premio Lo Nuestro Premio Lo Nuestro
   - 12 -




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We Have Experienced Substantial Losses, Primarily in Respect of Our Investments in Innova, and
Expect to Continue to Experience Substantial Losses as a Result of Our Participation in Innova,
Which Would Adversely Affect Our Net Income
  - 13 -




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We Have Recognized an Increased Indebtedness, a Cumulative Loss Effect and other Adverse
Accounting Impacts as a Result of the Consolidation of Innova since April 1, 2004 in our
Consolidated Financial Statements for the Year Ending December 31, 2004 and These Impacts Continued
in 2005 and May Continue in Future Years
    We Have Evaluated the Possibility of Potential Losses in Innova in Case of Business
Interruption Due to the Loss of Transmission and Loss of the Use of Satellite Transponders, Which
Would Adversely Affect Our Net Income
   - 14 -




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Risk Factors Related to Our Securities
 Any Actions Shareholders May Wish to Bring Concerning Our Bylaws or the CPO Trust Must Be
Brought in a Mexican Court
  Non-Mexicans May Not Hold A Shares, B Shares or D Shares Directly and Must Have Them Held in a
Trust at All Times
  Non-Mexican Holders of Our Securities Forfeit Their Securities if They Invoke the Protection
of Their Government
  Non-Mexican Holders of Our Securities Have Limited Voting Rights
  Our Antitakeover Protections May Deter Potential Acquirors and May Depress Our Stock Price
  GDS Holders May Face Disadvantages When Attempting to Exercise Voting Rights as Compared to
Other Holders of Our Securities
  - 15 -




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The Interests of Our GDS Holders Will Be Diluted if We Issue New Shares and These Holders Are
Unable to Exercise Preemptive Rights for Cash
  The Protections Afforded to Minority Shareholders in Mexico Are Different From Those in the
U.S.
 Ley del Mercado de Valores
  - 16 -




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It May Be Difficult to Enforce Civil Liabilities Against Us or Our Directors, Executive
Officers and Controlling Persons
  - 17 -




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Forward-Looking Statements
  
    
    projections of operating revenues, net income (loss), net income (loss) per share,
capital expenditures, dividends, capital structure or other financial items or ratios;
    
    statements of our plans, objectives or goals, including those relating to
anticipated trends, competition, regulation and rates;
    
    our current and future plans regarding our Spanish-language horizontal Internet
portal, EsMas.com;
    
    statements concerning our current and future plans regarding our investment in the
Spanish television channel La Sexta;
    
    statements concerning our current and future plans regarding our gaming business;
    
    statements concerning our transactions with and involving Univision;
    
    statements concerning our recent series of transactions with The DIRECTV Group,
Inc., or DIRECTV, and News Corporation, or News Corp.;
    
    statements about our future economic performance or that of Mexico or other
countries in which we operate or have investments; and
    
    statements of assumptions underlying these statements.
    - 18 -




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##### Table of Contents



Item 4. Information on the Company
 
 History and Development of the Company
 sociedad anónima, Ley General de Sociedades Mercantiles, (folio mercantil) estatutos sociales,
   
 Capital Expenditures
  Year Ended December 31,(1)2003
    
    
    2004
    
    
    2005
    
    
    2006(Millions of U.S. Dollars)Capital expenditures(2)
    
    
    U.S.$94.9
    
    
    
    U.S.$174.6
    
    
    
    U.S.$248.3
    
    
    
    U.S.$300.0Investments in DTH joint ventures(3)
    
    
    20.6
    
    
    
    12.5
    
    
    
    
    
    
    
    Investment in OCEN(4)
    
    
    4.8
    
    
    
    
    
    
    
    
    
    
    
    Other acquisitions and investments(5)(6)
    
    
    85.5
    
    
    
    29.3
    
    
    
    69.4
    
    
    
    272.4Total capital expenditures and investments
    
    
    U.S.$205.8
    
    
    
    U.S.$216.4
    
    
    
    U.S.$317.7
    
    
    
    U.S.$572.4
 - 19 -




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##### Table of Contents



(1)
    
    Amounts in respect of some of the capital expenditures, investments and acquisitions we
made in 2003, 2004 and 2005 were paid for in Mexican Pesos. These Mexican Peso amounts
were translated into U.S. Dollars at the Interbank Rate in effect on the dates on which a
given capital expenditure, investment or acquisition was made. As a result, U.S. Dollar
amounts presented in the table immediately above are not comparable to: (i) data regarding
capital expenditures set forth in Key Information  Selected Financial Data, which is
presented in constant Pesos of purchasing power as of December 31, 2005 and, in the case of
data presented in U.S. Dollars, is translated at a rate of Ps.10.6265 to one U.S. Dollar,
the Interbank Rate as of December 31, 2005, and (ii) certain data regarding capital
expenditures set forth under Operating and Financial Review and Prospects  Results of
Operations  Liquidity, Foreign Exchange and Capital Resources  Capital Expenditures,
Acquisitions and Investments, Distributions and Other Sources of Liquidity.(2)
    
    Reflects capital expenditures for property, plant and equipment, as well as general
capital expenditures, in all periods presented. Also includes U.S.$17.4 million in 2003,
U.S.$35.1 million in 2004, and U.S.$51.1 million in 2005 for the expansion and improvement
of our cable business; and U.S.57.6 million in 2004 and U.S.$109.2 million in 2005 for the
expansion and improvement of our SKY Mexico segment.(3)
    
    Includes investments made in the form of capital contributions and loans in all
periods.(4)
    
    In 2002, we acquired a 40% stake in OCESA Entretenimiento, or OCEN, our live
entertainment venture in Mexico, for U.S.$104.7 million, of which U.S.$37.7 million was
paid in the first quarter of 2003. Additionally, in the first quarter of 2003, we made a
capital contribution to OCEN of approximately U.S.$4.8 million. See  Business Overview 
Other Businesses  Sports and Show Business Promotions and Note 2 to our year-end
financial statements.(5)
    
    In 2003, we acquired Telespecialidades, a company which was owned by our controlling
shareholders, for an aggregate amount of U.S.$83.0 million. Telespecialidadess net assets
at the time of acquisition consisted principally of Shares of our capital stock in the form
of CPOs, which Shares were previously indirectly owned by our controlling shareholders, and
tax loss carryforwards. Telespecialidades was merged into Televisa S.A. de C.V. on
December 31, 2003. See Major Shareholders and Related Party Transactions  The Principal
Shareholders and Related Party Transactions  Related Party Transactions  Transactions
and Arrangements With Affiliates and Related Parties of Our Directors, Officers and Major
Shareholders. Additionally, in 2003 and 2004, we made capital contributions in the
aggregate amount of U.S.$2.5 million and U.S.$2.0 million, respectively, in our pay
television joint venture with Univision, which operations commenced in the U.S. in the
second quarter of 2003. In November 2005, we acquired Comtelvi, S. de R.L. de C.V.
(Comtelvi) from a third party for an aggregate amount of U.S.$39.1 million. At the time
of acquisition, Comtelvi had structured note investments and other financial instrument
assets and liabilities, as well as tax losses of approximately Ps.3,311.5 million that were
used by us in the fourth quarter of 2005. Additionally, in 2005 we made capital
contributions of approximately U.S.$1.4 million (1.2 million Euros) to Gestora de
Inversiones Audiovisuales La Sexta, S.A.U. (La Sexta), representing the 40% interest in
our Spanish Television broadcasting venture, which commenced operations in Spain in March
2006. See Information on the Company  Business Overview  Univision and Note 2 to our
year-end financial statements.(6)
    
    In the first quarter of 2006, we completed the acquisition of certain operating assets,
consisting primarily of trademarks, intellectual property rights and other publishing
assets owned by Editora Cinco, a publishing company in Mexico and Latin America, for an
aggregate amount of approximately U.S.$15.0 million. In the second quarter of 2006, we
acquired the minority interest in Innova that was formerly owned by
Liberty Media for an
amount of approximately U.S.$58.7 million to increase the interest in our Sky Mexico
business to 58.7%. Our projected total investment in La Sexta for 2006 is approximately
84.2 million Euros (approximately U.S.$108.0 million). In addition, we estimate that we
will invest approximately U.S.$90.7 million in connection with other potential investments
and acquisitions of our different business segments for the year ending December 31, 2006.  - 20 -




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##### Table of Contents



Business Overview
   Business Strategy
  Maintaining our leading position in the Mexican television market
 Continuing to produce high quality programming. Instituto Brasileño de
Opinión Pública y Estadística,
 Improving our sales and marketing efforts.
  - 21 -




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##### Table of Contents



Improving our operating margins.
 Continue building our pay television platforms
 DTH.
  
    
    offering high quality and exclusive programming, including rights in Mexico to our
four over-the-air broadcast channels and other channels produced by our partners, as
well as special events, such as reality shows, and games or sports programming we
produce or with respect to which we have exclusive rights;
    
    capitalizing on our relationship with DIRECTV and local operators in terms of
technology, distribution networks, infrastructure and cross-promotional opportunities;
    
    capitalizing on the low penetration of pay-television services in Mexico and elsewhere; and
    
    providing superior digital Ku-band DTH satellite services and emphasizing customer service quality.
 Cable.
 - 22 -




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##### Table of Contents




    
    continuing to offer high quality programming;
    
    upgrading its existing cable network into a broadband bidirectional network;
    
    switching its current analog subscribers to digital service in order to stimulate new
subscriptions, substantially reduce piracy and offer new value-added services;
    
    increasing the penetration of its high-speed and bidirectional Internet access and
other multimedia services as well as providing a platform to offer internet protocol, or
IP, telephony services; and
    
    continuing the roll out of digital set-top boxes and the roll out, which began in the
third quarter of 2005, of advanced digital set-top boxes which allow the transmission of
high definition programming and recording capability.
  Expanding our publishing business
  Seventeen Muy Interesante
 Celebrity, Poder Universo Big Bang Prestige Blau ESPN Tu Dinero Rebelde Sync Yo Soy Tigre
 - 23 -




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##### Table of Contents



Increasing our international programming sales and strengthening our position in the growing
U.S.- Hispanic market
       Hispanic
Magazine Hispanic Trends Hispanic Trends Hispanic Trends Hispanic
Magazine ESPN Deportes ESPN The Magazine Tu Dinero
 - 24 -




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##### Table of Contents



Developing new businesses and expanding through acquisitions.
   Secretaría de Gobernación
   La Sexta
  
    
    a call option under which we may subscribe, at a price of 80.0 million Euros, a
percentage of the capital stock of Imagina that will be determined as a result of the
application of a formula related to the enterprise value of Imagina at the time of
exrecise of the option by Televisa,
    
    an exclusivity period of up to 120 days to acquire up to 20% of the capital stock of
Imagina,
    
    a right to match an offer from a third party to subscribe or acquire stock of
Imagina for a period of 137 days after the exclusivity period ends, and
    
    a right of first refusal until June 30, 2011 to acquire a certain percentage of the
capital stock of Imagina.
  - 25 -




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##### Table of Contents



Television
 Television Industry in Mexico
 General.
  Ratings and Audience Share.
  Programming
 Programming We Produce
   - 26 -




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##### Table of Contents



Foreign-Produced Programming
 Talent Promotion
 Television Broadcasting
  Wholly Owned
    
    Wholly
    
    Majority
    
    MinorityMexico City
    
    Owned
    
    Owned
    
    Owned
    
    Independent
    
    TotalAnchor Stations
    
    Affiliates
    
    Affiliates
    
    Affiliates
    
    Affiliates
    
    StationsChannel 2
    
    
    1
    
    
    
    124
    
    
    
    2
    
    
    
    
    
    
    
    1
    
    
    
    128Channel 4
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Channel 5
    
    
    1
    
    
    
    61
    
    
    
    
    
    
    
    
    
    
    
    4
    
    
    
    66Channel 9
    
    
    1
    
    
    
    14
    
    
    
    
    
    
    
    
    
    
    
    14
    
    
    
    29Subtotal
    
    
    4
    
    
    
    199
    
    
    
    2
    
    
    
    
    
    
    
    19
    
    
    
    224Border Stations
    
    
    
    
    
    
    1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1Local (Stations) Affiliates
    
    
    
    
    
    
    18
    
    
    
    
    
    
    
    1
    
    
    
    14
    
    
    
    33Total
    
    
    4
    
    
    
    218
    
    
    
    2
    
    
    
    1
    
    
    
    33
    
    
    
    258
  - 27 -




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##### Table of Contents



Average Audience Share (1)  January 2003  December 2005
 
 Average Ratings (1)  January 2003 December 2005
 
 
  - 29 -




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##### Table of Contents



Channel 2 Network El Canal de las Estrellas
  Year Ended December 31,2003(1)
    
    2004(1)
    
    2005(1)Prime time hours
    
    
    32.5
    %
    
    
    31.0
    %
    
    
    31.8
    %Weekday prime time hours
    
    
    36.5
    %
    
    
    32.9
    %
    
    
    36.2
    %Sign-on to sign-off hours
    
    
    30.9
    %
    
    
    29.9
    %
    
    
    30.3
    %
 
 (1)
    
    Source: IBOPE Mexico national surveys.  Channel 5 Network
  Year Ended December 31,2003(1)
    
    2004(1)
    
    2005(1)Prime time hours
    
    
    18.3
    %
    
    
    19.6
    %
    
    
    17.4
    %Weekday prime time hours
    
    
    18.1
    %
    
    
    19.8
    %
    
    
    15.9
    %Sign-on to sign-off hours
    
    
    20.3
    %
    
    
    21.6
    %
    
    
    20.1
    %
 
 (1)
    
    Source: IBOPE Mexico national surveys.  Channel 4 Network
 - 30 -




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##### Table of Contents



Year Ended December 31,2003(1)
    
    2004(1)
    
    2005(1)Prime time hours
    
    
    8.0
    %
    
    
    6.6
    %
    
    
    6.0
    %Weekday prime time hours
    
    
    8.1
    %
    
    
    7.0
    %
    
    
    6.3
    %Sign-on to sign-off hours
    
    
    10.1
    %
    
    
    8.7
    %
    
    
    7.6
    %
 
 (1)
    
    Source: IBOPE Mexico national surveys.  Channel 9 Network.
  Year Ended December 31,2003(1)
    
    2004(1)
    
    2005(1)Prime time hours
    
    
    11.2
    %
    
    
    11.7
    %
    
    
    13.4
    %Weekday prime time hours
    
    
    9.2
    %
    
    
    9.9
    %
    
    
    10.6
    %Sign-on to sign-off hours
    
    
    10.5
    %
    
    
    11.0
    %
    
    
    12.2
    %
 
 (1)
    
    Source: IBOPE Mexico national surveys.  Local Affiliates.
 Border Stations.
 - 31 -




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##### Table of Contents



Advertising Sales Plan.
  Pay Television Networks.
 Telehit, Ritmoson Latino, Bandamax, De Película, De Película
Clásico, Unicable, Cinema Golden Choice 1 & 2 Cinema Golden Choice Latinoamérica Canal de
Telenovelas, American Network, Canal de las Estrellas Latinoamérica Canal de las Estrellas
Europa
  Programming Exports.
 Expansion of Programming Reach.
 Publishing
  - 32 -




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##### Table of Contents



Editorial. TV y Novelas Tele Guía. Vanidades Caras Eres Conozca Más Furia Musical Banda Onda Grupera Vanidades TV y Novelas USA Caras.
 Cosmopolitan Good
Housekeeping Harpers Bazaar Popular Mechanics PC Magazine EGM Electronic Gaming Monthly Maxim Marie Claire Mens
Health and Prevention Sport Life Automóvil Panamericano Muy Interesante Padres e Hijos Mia Golf Digest Ocean Drive Disney Princesas Disney Winnie Pooh W.I.T.C.H Travel + Leisure National Geographic National Geographic Kids
 Celebrity Poder Universo Big Bang Prestige Blau ESPN Tu Dinero Rebelde Sync Yo Soy Tigre Yo Pink
 Seventeen Muy Interesante
 Publishing Distribution.
 - 33 -




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##### Table of Contents



Cable Television
 The Cable Television Industry in Mexico. Cámara Nacional de la Industria de Televisión por
Cable
 Mexico
City Cable System.
  Cable Television Services.
 Pay-Per-View Channels.
 Cable Television Revenues.
   Cable Television Initiatives.
 - 34 -




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##### Table of Contents




    
    enhanced programming services, including VOD services and video games; and
    
    IP telephony services.
   Radio
 Radio Stations
   - 35 -




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##### Table of Contents



Hoy x
Hoy  Pasión W/Estadio W, Poder y Dinero,
   Radio Advertising.
 Other Businesses
 Esmas.com. Esmas.com Esmas.com
  Esmas.com Esmas.com Esmas.com
 - 36 -




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##### Table of Contents



Esmas.com
 Sports and Show Business Promotions.
 Soccer. América
 América, Atlante América Necaxa
 Promotions.
 Live Entertainment Vívelo
 Feature Film Production and Distribution.
 La Última Noche Puños
Rosas.
  Harry
Potter and the Goblet of Fire, Batman Begins Constantine 7 Dias Million Dollar Baby
  - 37 -




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##### Table of Contents



Nationwide Paging.
 Gaming Business PlayCity.
 Investments
 OCEN.
 Mutual Fund Venture.
 Volaris.
 La Sexta. La Sexta
  - 38 -




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##### Table of Contents




    
    a call option under which we may subscribe, at a price of 80 million Euros, a
percentage of the capital stock of Imagina that will be determined as a result of the
application of a formula related to the enterprise value of Afinia at the time of
exercise of the option by Televisa,
    
    an exclusivity period of up to 120 days to acquire up to 20% of the capital stock of
Imagina,
    
    a right to match an offer from a third party to subscribe or acquire stock of
Imagina for a period of 137 days after the exclusivity period ends, and
    
    a right of first refusal until June 30, 2011 to acquire a certain percentage of the
capital stock of Imagina.
  WALMEX.
  DTH Joint Ventures
 Background.
   - 39 -




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##### Table of Contents




    
    Innova and DIRECTV Mexico entered into a purchase and sale agreement, pursuant to
which Innova agreed to purchase DIRECTV Mexicos subscriber list for two promissory
notes with an aggregate original principal amount of approximately Ps.621.1 million;
    
    Innova and DIRECTV Mexico entered into a letter agreement which provided for cash
payments to be made by Innova or DIRECTV Mexico based on the number of subscribers
successfully migrating to Innova, the applicable sign-up fees for migrating
subscribers, or certain migrated subscribers churning shortly after migration, among
other specified payments under the agreement;
    
    Innova, Innova Holdings and News Corp. entered into an option agreement, pursuant to
which News Corp. was granted options to acquire up to a 15% equity interest in each of
Innova and Innova Holdings, dependent upon the number of subscribers successfully
migrating to Innova; in exchange for the two promissory notes referred above that were
delivered to DIRECTV Mexico;
    
    DIRECTV and News Corp. entered into a purchase agreement pursuant to which DIRECTV
acquired (i) the right (which DIRECTV concurrently assigned to DTVLA) to purchase from
News Corp. the options granted to News Corp. by Innova and Innova Holdings to purchase
up to an additional 15% of the outstanding equity of each of such entities pursuant to
the option agreement described above, and (ii) the right to acquire News Corp.s 30%
interest in Innova and Innova Holdings;
    
    DIRECTV and Liberty Media International, Inc., or Liberty Media, entered into a
purchase agreement pursuant to which DIRECTV agreed to purchase all of Liberty Medias
10% interest in Innova and Innova Holdings for U.S.$88 million in cash. DIRECTV agreed
that we may purchase two-thirds (2/3) of any equity interest in Innova and Innova
Holdings sold by Liberty Media;
    
    pursuant to the DTH agreement we entered into with News Corp., Innova, DIRECTV and
DTVLA, with respect to certain DTH platforms owned or operated by News Corp. or DIRECTV
or their affiliates and subject to certain restrictions, we have the right to require
carriage of five of our channels on any such platform serving Latin America (including
Puerto Rico but excluding Mexico, Brazil and countries in Central America), two of our
channels on any such platform serving the United States or Canada, and one of our
channels on any such platform serving areas other than the United States and Latin
America;
    
    we, News Corp., Innova, DIRECTV and DTVLA entered into a DTH agreement that, among
other things, governs the rights of the parties with respect to DTVLAs announced
shutdown of its Mexican DTH business, planned shutdown of its existing DTH business in
certain countries in Central America,
 - 40 -




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##### Table of Contents



the carriage of certain of our programming channels by Innova and other DTH platforms of
DIRECTV, DTVLA, News Corp. and their respective affiliates, and the waiver and potential
release of certain claims between certain of the parties; and
    
    we and Innova entered into a channel licensing agreement pursuant to which Innova
will pay us a royalty fee to carry our over-the-air channels on its DTH service.
  
    
    we entered into a purchase and sale agreement with DIRECTV, pursuant to which, among
other things, (i) DIRECTV acquired all of our direct equity interests in ServiceCo,
(ii) DIRECTV agreed to purchase all of our indirect equity interests in MCOP, and (iii)
DIRECTV has agreed to indemnify us for any and all losses arising out of our status as
a partner in MCOP;
    
    DIRECTV also agreed to purchase each of News Corp.s, Liberty Medias and Globopars
equity interests in TechCo (a U.S. partnership formed to provide technical services
from a main uplink facility in Miami Lakes, Florida and a redundancy site in Port St.
Luice, Florida), ServiceCo and MCOP; and
    
    PanAmSat Corporation, or PanAmSat, unconditionally released us from any and all
obligations related to the MCOP transponder lease.
  
    
    DIRECTV Holdings exercised its right to acquire News Corp.s 30% interest in Innova
and DTVLA exercised the right to purchase the options granted to News Corp. by Innova
and Innova Holdings to purchase up to an additional 12% of the outstanding equity of
each of such entities pursuant to the previously disclosed option agreement;
    
    DTVLA exercised an option to purchase 12% of Innova and Innova Holdings which was
based on the number of subscribers successfully migrating to Innova, by delivering to
Innova and Innova Holdings the two promissory notes issued in connection with Innovas
purchase of DIRECTV Mexicos subscriber list for cancellation in October 2004;
    
    DIRECTV Mexico made cash payments to Innova totaling approximately $2.7 million
pursuant to a letter agreement entered into by both parties in October 2004 in
connection with the purchase of the DIRECTV Mexicos subscriber list. The payments were
made due to certain ineligible subscribers, applicable sign-up costs, and other costs
under the side letter;
    
    DIRECTV Holdings purchased all of Liberty Medias 10% interest in Innova. As
described below, we exercised the right to acquire two-thirds of this 10% equity
interest acquired from Liberty Media; and
    
    we entered into an amended and restated guaranty with PanAmSat, pursuant to which
the proportionate share of Innovas transponder lease obligation guaranteed by us was
to cover a percentage of the transponder lease obligations equal to our percentage
ownership of Innova. As a result of our acquisition of two-thirds of the equity
interests that DIRECTV acquired from Liberty Media; the guarantee has been readjusted
to cover a percentage of the transponder lease obligations equal to our percentage
ownership of Innova.
   - 41 -




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Mexico.
 Copa
Libertadores
       - 42 -




---



##### Table of Contents



Colombia.
 Chile.
 Programming.
 Univision
    - 43 -




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##### Table of Contents



- 44 -




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Competition
  Television Broadcasting
     Publishing
  Cable Television
  - 45 -




---



##### Table of Contents



Ley Federal de
Telecomunicaciones
  Radio
   Feature Film Production and Distribution
  DTH Satellite Services
     - 46 -




---



##### Table of Contents



Regulation
  Television
 Mexican Television Regulations
 Concessions.
 
    
    failure to construct broadcasting facilities within a specified time period;
    
    changes in the location of the broadcasting facilities or changes in the
frequency assigned without prior governmental authorization;
    
    direct or indirect transfer of the concession, the rights arising therefrom
or ownership of the broadcasting facilities without prior governmental authorization;
    
    transfer or encumbrance, in whole or in part, of the concession, the rights
arising therefrom, the broadcasting equipment or any assets dedicated to the
concessionaires activities, to a foreign government, company or individual, or the
admission of any such person as a partner in the concessionaires business;
    
    failure to broadcast for more than 60 days without reasonable justification;
    
    any amendment to the bylaws of the concessionaire that is in violation of
applicable Mexican law; and
    
    any breach to the terms of the concession title.
    - 47 -




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##### Table of Contents



Supervision of Operations.
 Secretaría de
Gobernación
  Networks.
 Restrictions on Advertising. Ley General de Salud,
  Broadcast Tax.
 Foreign Ownership. Ley de Inversión Extranjera, Ley Federal de
Radio y Televisión Reglamento de la Ley de Inversión
Extranjera
 Regulation of U.S. Television Broadcast Networks and Satellite/Cable Networks
  - 48 -




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Television Broadcast Network Restrictions.
 Satellite/Cable Network Restrictions.
 Ownership Restrictions.
 U.S. Regulation of Broadcast Stations
  Ownership Matters.
   - 49 -




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Alien Ownership.
 - 50 -




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License Renewal.
 Programming and Operation.
  Digital Television Transition.
  Cable Carriage.
 Direct Broadcast Satellite Carriage.
 - 51 -




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Proposed Changes.
 Radio
  Cable Television
 Concessions.
 
    
    unauthorized interruption or termination of service;
    
    interference by the concessionaire with services provided by other operators;
    
    noncompliance with the terms and conditions of the public telecommunications concession;
    
    the concessionaires refusal to interconnect with other operators;
    
    loss of the concessionaires Mexican nationality;
    
    unauthorized assignment, transfer or encumbrance, in whole or in part, of
the concession or any rights or assets;
    
    the liquidation or bankruptcy of the concessionaire; and
    
    ownership or control of the capital stock of the concessionaire by a foreign government.
  Reglamento del Servicio de Televisión y Audio
Restringidos
 - 52 -




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Reglamento de la Ley
Federal de Radio y Televisión y de la Industria Cinematográfica
  Supervision of Operations.
    Restrictions on Advertising.
 Government Participation.
 Forfeiture of Assets.
 Non-Mexican Ownership of Public Telecommunications Networks
 Comisión Nacional de Inversiones Extranjeras
 - 53 -




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Application of Existing Regulatory Framework to Internet Access and IP Telephony Services
   Satellite Communications
 Mexican Regulation of DTH Satellite Services.
  
    
    the failure to use the concession within 180 days after it was granted;
    
    a declaration of bankruptcy of the concessionaire;
    
    failure to comply with the obligations or conditions specified in the concession;
    
    unlawful assignments of, or encumbrances on, the concession; or
    
    failure to pay to the government the required fees.
    Regulation of DTH Satellite Services in Other Countries.
 - 54 -




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Mexican Gaming Regulations
 Ley Federal de Juegos y Sorteos Reglamento de la Ley Federal de Juegos y
Sorteos Secretaría de Gobernación
 Secretaría de Gobernación
 Mexican Antitrust Law
 Ley Federal de Competencia Económica Reglamento
de la Ley Federal de Competencia Económica
   
    
    Raising the thresholds to make a concentration a reportable transaction.
    
    Empowering the Mexican Antitrust Commission to issue a waiting order before a
reported transaction may be closed, if such order is issued within ten business days
from the date the transaction is reported to the Antitrust Commission.
    
    Requiring the Mexican Antitrust Commission to rule upon a reported transaction that
the filing party deems that it does not notoriously restrain competition (attaching the
necessary evidence), within 15 business days from the filing date.
  
    
    An overreaching authority to determine whether competition, effective competition,
market power and competition conditions in a specific market exist or not, either such
determination is required under the antitrust law or if required under any other
statute that requires a determination of market conditions.
    
    To issue binding opinions in competition matters whether required by specific
statutes, if required by other federal authorities. Such opinions shall also be issued
in connection with decrees, regulations,
 - 55 -




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governmental determinations and other governmental acts (such as public bid rules) which
may have an anticompetitive effect.
    
    It must issue an opinion related to effective competition conditions in a specific
market or to the market power of a given agent in a market.
    
    Issue an opinion related to the granting of concessions, licenses or permits or the
transfer of equity interests in concessionaries or licensees, are to be obtained if so
required by the relevant statues or the bid rules.
    
    The authority to perform visits to economic agents with the purpose of obtaining
evidence of violations to the law, including the ability to obtain evidence of the
incurrence of a vertical or horizontal restraint. In all cases, the Mexican Antitrust
Commission must obtain a judicial subpoena in order to proceed with the visits. Any
agent that is subject to such order is bound to allow such visits and to cooperate
fully with the Mexican Antitrust Commission.
  Significant Subsidiaries, etc.
  Jurisdiction ofOrganization orName of Significant Subsidiary
    
    Incorporation
    
    Percentage Ownership(1)Corporativo Vasco de Quiroga, S.A. de C.V.(2)(3)
    
    Mexico
    
    
    100.0
    %CVQ Espectáculos, S.A. de C.V.(2)(3)
    
    Mexico
    
    
    100.0
    %Editora Factum, S.A. de C.V.(3)(4)
    
    Mexico
    
    
    100.0
    %Empresas Cablevisión, S.A. de C.V.(3)(5)
    
    Mexico
    
    
    51.0
    %Galavision DTH, S. de R.L. de C.V.(3)(6)
    
    Mexico
    
    
    100.0
    %Editorial Televisa, S.A. de C.V.(3) (7)
    
    Mexico
    
    
    100.0
    %Factum Mas, S.A. de C.V.(3) (8)
    
    Mexico
    
    
    100.0
    %Sky DTH, S. de R.L. de C.V.(8)
    
    Mexico
    
    
    100.0
    %Innova, S. de R.L. de C.V. (Innova).(9)
    
    Mexico
    
    
    60.0
    %Grupo Distribuidoras Intermex, S.A. de C.V.(3)(10)
    
    Mexico
    
    
    100.0
    %Campus América, S.A. de C.V. (11)
    
    Mexico
    
    
    100.0
    %Television Holdings USA, LLC(11)
    
    USA
    
    
    100.0
    %Sistema Radiópolis, S.A. de C.V.(3)(12)
    
    Mexico
    
    
    50.0
    %Telesistema Mexicano, S.A. de C.V.(13)
    
    Mexico
    
    
    100.0
    %G-Televisa-D, S.A. de C.V.(14)
    
    Mexico
    
    
    100.0
    %Televisa, S.A. de C.V.(15)
    
    Mexico
    
    
    100.0
    %Televisión Independiente de México, S.A. de C.V.(3)(13)
    
    Mexico
    
    
    100.0
    %
 
 (1)
    
    Percentage of equity owned by us directly or indirectly through subsidiaries or affiliates.(2)
    
    One of two direct subsidiaries through which we conduct the operations of our Other
Businesses segment, excluding Internet operations.(3)
    
    While this subsidiary is not a significant subsidiary within the meaning of Rule 1-02(w) of
Regulation S-X under the Securities Act, we have included this subsidiary in the table above
to provide a more complete description of our operations.(4)
    
    Subsidiary through which we own equity interests in and conduct our cable television and
Internet businesses.(5)
    
    Direct subsidiary through which we conduct the operating of our Cable Television business.
For a description of América Móvils sale of its 49% equity interest in this business in April
2002, see Information on the Company  Business Overview  Cable Television  Mexico City
Cable System.(6)
    
    Subsidiary through which we own equity interests in DTH joint ventures, excluding Innova.(7)
    
    Subsidiary through which we conduct the operations of our Publishing segment.(8)
    
    One of two subsidiaries through which we own our equity interest in Innova. - 56 -




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(9)
    
    Variable interest entity through which we conduct the operations of our Sky Mexico segment.
We currently own a 58.7% interest in Innova.(10)
    
    Direct subsidiary through which we conduct the operations of our Publishing Distribution
segment.(11)
    
    One of two subsidiaries through which we own most of our equity interest in Univision.(12)
    
    Direct subsidiary through which we conduct the operations of our Radio segment. Since we hold
a controlling 50% full voting stake in this subsidiary and have the right to elect a majority
of the members of its Board of Directors, we will continue to consolidate 100% of the results
of operations of this subsidiary in accordance with Mexican GAAP. See Operating and Financial
Review and Prospects  Results of Operations  Total Segment
Results  Radio and Operating and Financial Review and
Prospects  Results of Operations  Minority Interest.(13)
    
    One of two direct subsidiaries through which we conduct the operations of our Television
Broadcasting, Pay Television Networks and Programming Exports segments.(14)
    
    Indirect subsidiary through which we conduct certain operations of our Television
Broadcasting segment.(15)
    
    Indirect subsidiary through which we conduct the operations of our Television Broadcasting,
Pay Television Networks and Programming Exports segments. Property, Plant and Equipment
 Broadcasting, Office and Production Facilities.
   - 57 -




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##### Table of Contents



Number ofOperations
    
    Properties
    
    LocationTelevision and news activitiesOwned properties
    
    
    1
    
    
    San Diego, CaliforniaLeased properties
    
    
    5
    
    
    Madrid, Spain
San Diego, California
Miami, Florida
Zug, SwitzerlandPublishing activitiesOwned properties
    
    
    1
    
    
    Miami, FloridaLeased properties
    
    
    19
    
    
    Beverly Hills, CaliforniaMiami, Florida
New York, New York
Medellín, Colombia
Cali, Colombia
Quito, Ecuador
Lima, Perú
Santiago, Chile
Caracas, Venezuela
Los Angeles, California
Austin, Texas
San Juan, Puerto Rico
Guaynabo, Puerto Rico
Bogotá, ColumbiaPublishing distribution and other activitiesOwned properties
    
    
    7
    
    
    Bogotá, Colombia
Cali, Colombia
Baranquilla, Colombia
Guayaquil, Ecuador
Miami, Florida
Lima, PerúLeased properties
    
    
    8
    
    
    Quito, Ecuador
Baranquilla, Colombia
Bogotá, Colombia
Medellín, Colombia
Lima, Perú
Buenos Aires,
Argentina
Panamá, Panamá
Santiago, Chile
 Satellites.
  - 58 -




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Insurance.
 - 59 -




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Item 5. Operating and Financial Review and Prospects
 You should read the following discussion together with our year-end financial statements and
the accompanying notes, which appear elsewhere in this annual report. This annual report contains
forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could
differ materially from those discussed in these forward-looking statements. Factors that could
cause or contribute to these differences include, but are not limited to, those discussed below and
elsewhere in this annual report, particularly in Key Information  Risk Factors. In addition to
the other information in this annual report, investors should consider carefully the following
discussion and the information set forth under Key Information  Risk Factors before evaluating
us and our business.
 We began to consolidate Innova, our DTH joint venture in Mexico, effective April 1, 2004.
Accordingly, our financial results for the year ended December 31, 2005 may not be directly
comparable to our financial results for the year ended December 31, 2004 and our financial results
for the year ended December 31, 2004 may not be directly comparable to our financial results for
the year ended December 31, 2003.
 
 Preparation of Financial Statements
  
 Results of Operations
  Year EndedDecember 31,(1)2003
    
    2004
    
    2005Segment Net SalesTelevision Broadcasting
    
    
    64.4
    %
    
    
    56.9
    %
    
    
    55.4
    %Pay Television Networks
    
    
    2.9
    
    
    
    2.7
    
    
    
    3.3Programming Exports
    
    
    6.8
    
    
    
    6.4
    
    
    
    5.6Publishing
    
    
    7.5
    
    
    
    7.0
    
    
    
    7.5Publishing Distribution
    
    
    7.5
    
    
    
    5.2
    
    
    
    1.2Sky Mexico(2)
    
    
    
    
    
    
    12.1
    
    
    
    17.9Cable Television
    
    
    4.1
    
    
    
    3.7
    
    
    
    4.2Radio
    
    
    1.1
    
    
    
    1.0
    
    
    
    1.0Other Businesses
    
    
    5.7
    
    
    
    5.0
    
    
    
    3.9Total Segment Net Sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Intersegment Operations
    
    
    (1.3
    )
    
    
    (2.4
    )
    
    
    (3.1
    )Total Consolidated Net Sales
    
    
    98.7
    %
    
    
    97.6
    %
    
    
    96.9
    %
 - 60 -




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Year EndedDecember 31,(1)2003
    
    
    2004
    
    
    2005Total Net SalesCost of sales
    
    
    54.7
    %
    
    
    50.6
    %
    
    
    45.4
    %Selling expenses
    
    
    7.2
    
    
    
    7.5
    
    
    
    8.2Administrative expenses
    
    
    6.0
    
    
    
    5.6
    
    
    
    5.7Operating income
before depreciation
and amortization
    
    
    32.1
    
    
    
    36.3
    
    
    
    40.7Total
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
 
 (1)
    
    Certain segment data set forth in these tables may vary from certain data set forth in our
year-end consolidated financial statements due to differences in rounding. The segment net
sales and total segment net sales data set forth in this annual report reflect sales from
intersegment operations in all periods presented. See Note 23 to our year-end financial
statements.(2)
    
    Effective April 1, 2004, we began consolidating Sky Mexico, which is applicable under Mexican
GAAP Bulletin A-8, Supplementary Application of International Accounting Standards. Summary of Business Segment Results
  Year Ended December 31,(1)2003
    
    
    2004
    
    
    2005Millions of Pesos in purchasing poweras of December 31, 2005Segment Net SalesTelevision Broadcasting
    
    Ps.
    16,725.2
    
    
    Ps.
    17,671.9
    
    
    Ps.
    18,570.8Pay Television Networks
    
    
    760.5
    
    
    
    827.5
    
    
    
    1,111.2Programming Exports
    
    
    1,771.9
    
    
    
    1,981.2
    
    
    
    1,875.9Publishing
    
    
    1,943.2
    
    
    
    2,163.1
    
    
    
    2,505.5Publishing Distribution(2)
    
    
    1,930.7
    
    
    
    1,626.4
    
    
    
    402.2Sky Mexico(3)
    
    
    
    
    
    
    3,758.3
    
    
    
    5,986.5Cable Television
    
    
    1,072.3
    
    
    
    1,165.5
    
    
    
    1,405.1Radio
    
    
    271.0
    
    
    
    305.6
    
    
    
    344.7Other Businesses
    
    
    1,479.7
    
    
    
    1,547.4
    
    
    
    1,324.3Total Segment Net Sales
    
    
    25,954.5
    
    
    
    31,046.9
    
    
    
    33,526.2Intersegment Operations
    
    
    (342.1
    )
    
    
    (755.7
    )
    
    
    (1,045.2
    )Total Consolidated Net Sales
    
    Ps.
    25,612.4
    
    
    Ps.
    30,291.2
    
    
    Ps.
    32,481.0
 - 61 -




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Year Ended December 31,(1)2003
    
    
    2004
    
    
    2005Millions of Pesos in purchasingpower as of December 31, 2005Segment Operating Income (Loss) Before
Depreciation and AmortizationTelevision Broadcasting
    
    Ps.
    7,109.0
    
    
    Ps.
    8,018.8
    
    
    Ps.
    8,852.6Pay Television Networks
    
    
    167.7
    
    
    
    308.5
    
    
    
    518.1Programming Exports
    
    
    541.3
    
    
    
    756.1
    
    
    
    668.7Publishing
    
    
    376.2
    
    
    
    438.9
    
    
    
    480.1Publishing Distribution
    
    
    9.4
    
    
    
    (26.2
    )
    
    
    6.6Sky Mexico(3)
    
    
    
    
    
    
    1,383.2
    
    
    
    2,516.8Cable Television
    
    
    327.6
    
    
    
    368.4
    
    
    
    489.6Radio
    
    
    24.4
    
    
    
    32.8
    
    
    
    52.2Other Businesses
    
    
    (163.7
    )
    
    
    (132.1
    )
    
    
    (180.4
    )Total Segment OIBDA(4)
    
    
    8,391.9
    
    
    
    11,148.4
    
    
    
    13,404.3Corporate Expenses(4)
    
    
    (162.3
    )
    
    
    (161.2
    )
    
    
    (182.5
    )Total Consolidated OIBDA
    
    Ps.
    8,229.6
    
    
    Ps.
    10,987.2
    
    
    Ps.
    13,221.8
 
 (1)
    
    Certain segment data set forth in these tables may vary from certain data set forth in our
year-end financial statements due to differences in rounding. The segment net sales and total
segment net sales data set forth in this annual report reflect sales from intersegment
operations in all periods presented. See Note 23 to our year-end financial statements.(2)
    
    Effective October 1, 2004, we changed our accounting treatment of net sales and cost of
sales. We recognized sales as the marginal revenue from the products we distribute.(3)
    
    Effective April 1, 2004, we began consolidating Sky Mexico, in accordance with FIN 46, which
is applicable under Mexican GAAP Bulletin A-8, Supplementary Application of International
Accounting Standards.(4)
    
    The segment operating income (loss) before depreciation and amortization, or OIBDA, and total
segment operating income before depreciation and amortization data set forth in this annual
report do not reflect corporate expenses in any period presented. Total consolidated operating
income before depreciation and amortization reflects corporate expenses in all periods
presented. See Note 23 to our year-end financial statements. Seasonality
  - 62 -




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Results of Operations for the Year Ended December 31, 2005
Compared to the Year Ended December 31, 2004
 Total Segment Results
 Net Sales
  Cost of Sales
  Selling Expenses
  Administrative Expenses
  Operating Income before Depreciation and Amortization
  Television Broadcasting
  - 63 -




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Advertising Rates and Sales
    Net Sales
  Operating Income before Depreciation and Amortization
  Pay Television Networks
  - 64 -




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Net Sales
  Operating Income before Depreciation and Amortization
  Programming Exports
  Net Sales
  Operating Income before Depreciation and Amortization
  Publishing
  Net Sales
  - 65 -




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Operating Income before Depreciation and Amortization
  Publishing Distribution
   Net Sales
   Operating Result before Depreciation and Amortization
  Sky Mexico
  - 66 -




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##### Table of Contents



Net Sales
  Operating Income before Depreciation and Amortization
  Cable Television
  Net Sales
  Operating Income before Depreciation and Amortization
  Radio
  - 67 -




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Net Sales
  Operating Income before Depreciation and Amortization
  Other Businesses
 Esmas.com
 Net Sales
  Operating Loss before Depreciation and Amortization
  Depreciation and Amortization
  Non Operating Results
 Integral Cost of Financing, Net
  
    
    interest income;
 - 68 -




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
    
    interest expense, including the restatement of our UDI-denominated notes, as described
under  Liquidity, Foreign Exchange and Capital Resources  Indebtedness and 
Liquidity, Foreign Exchange and Capital Resources  Interest Expense;
    
    foreign exchange gain or loss attributable to monetary assets and liabilities
denominated in foreign currencies (including gains or losses from derivative instruments);
and
    
    gain or loss attributable to holding monetary assets and liabilities exposed to
inflation.
    Restructuring and Non-recurring Charges
  Other Expense, Net
  Income Tax, Assets Tax and Employees Profit Sharing
   - 69 -




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Equity in Earnings of Affiliates
   Cumulative Loss Effect of Accounting Changes, Net
   Minority Interest
   - 70 -




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##### Table of Contents



Net Income
  
    
    a Ps.1,959.8 million increase in operating income;
    
    a Ps.178.5 million decrease in restructuring and non-recurring charges;
    
    a Ps.68.0 million decrease in other expense, net;
    
    a Ps.444.3 million decrease in income taxes; and
    
    a Ps.549.5 million decrease in cumulative loss effect of accounting changes, net.
  
    
    a Ps.215.4 million increase in integral cost of financing, net;
    
    a Ps.475.3 million decrease in equity in earnings of affiliates, net; and
    
    a Ps.844.5 million increase in minority interest.
 Capital Expenditures and Investments
  
    
    made aggregate capital expenditures for property, plant and equipment of approximately
U.S.$248.3 million, which amount includes capital expenditures in the amount of U.S.$51.1
million and U.S.$109.2 million for the expansion and improvement of our Cable Television
and Sky Mexico segments, respectively;
    
    invested a capital contribution of U.S.$25.0 million in Volaris, a new,
low-cost-carrier airline with a concession to operate in Mexico, and made a capital
contribution of U.S.$1.4 million related to our Spanish venture, La Sexta; and
    
    contributed Ps.5.0 million (nominal) to fund our seniority premium obligations.
 Indebtedness
  - 71 -




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Results of Operations for the Year Ended December 31, 2004
Compared to the Year Ended December 31, 2003
 Total Segment Results
 Net Sales
  Cost of Sales
  Selling Expenses
  Administrative Expenses
  Operating Income before Depreciation and Amortization
   - 72 -




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Television Broadcasting
 Net Sales
  Operating Income before Depreciation and Amortization
  Pay Television Networks
 Net Sales
  Operating Income before Depreciation and Amortization
  Programming Exports
 Net Sales
  Operating Income before Depreciation and Amortization
  - 73 -




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Publishing
 Net Sales
  Operating Result before Depreciation and Amortization
  Publishing Distribution
 Net Sales
   Operating Result before Depreciation and Amortization
  Sky Mexico
 Net Sales
  - 74 -




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Operating Income before Depreciation and Amortization
  Cable Television
 Net Sales
  Operating Income before Depreciation and Amortization
  Radio
 Net Sales
  Operating Income before Depreciation and Amortization
  Other Businesses
 Net Sales
  Operating Loss before Depreciation and Amortization
  - 75 -




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Depreciation and Amortization
 EsMas.com.
 Integral Cost of Financing, Net
  
    
    a Ps.669.8 million increase in interest expense, primarily as a result of an increase
in the average amount of debt, resulting from the consolidation of Sky Mexicos debt
beginning in the second quarter of 2004;
    
    a Ps.305.4 million loss resulting from a net foreign exchange loss in 2004 compared to
a net foreign exchange gain in 2003, primarily in connection with a negative hedge effect
in 2004 that arose from a 0.68% appreciation of the Peso against the U.S. Dollar during
2004. This compares to a favorable hedge effect in 2003, resulting from a 7.27%
depreciation of the Peso against the U.S. Dollar during the year ended December 31, 2003;
and
    
    a Ps.28.0 million decrease in interest income, reflecting Sky Mexicos capitalization
in September 2003 of all amounts due to us in connection with certain financing provided
for this joint venture, which was partially offset by an increase in interest income in
connection with a higher average amount of temporary investments during 2004.
  Restructuring and Non-recurring Charges
  Other Expense, Net
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Income Tax and Assets Tax
  Equity in Earnings of Affiliates
  
    
    the reversal of previous reserves due to our release from our PAS 6B satellite
transponder guarantee in connection with Sky Multi-Country Partners;
    
    the absence of equity loss of Sky Mexico of approximately Ps.215.4 million;
    
    a reduction in our equity loss of DTH TechCo Partners of Ps.119.8 million in 2004; and
    
    an increase in our equity income relating to our investment in Univision.
 Minority Interest
  Net Income
  
    
    a Ps.2,271.3 million increase in operating income;
    
    a Ps.306.0 million decrease in restructuring and non-recurring charges;
    
    a Ps.58.3 million decrease in other expense, net;
    
    a Ps.604.7 million increase in equity in earnings from affiliates; and
    
    a Ps.69.7 million decrease in loss from discontinued operations.
  Effects of Devaluation and Inflation
  
    
    the percentage that the Peso devalued or appreciated against the U.S. Dollar;
    
    the Mexican inflation rate;
 - 77 -




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
    
    the U.S. inflation rate; and
    
    the percentage change in Mexican GDP compared to the prior period.
 Year Ended December 31,2003
    
    
    2004
    
    
    2005Devaluation (appreciation) of
the Mexican Peso as compared to the
U.S. Dollar(1)
    
    
    7.3
    %
    
    
    (0.7
    )%
    
    
    (4.7
    )%Mexican inflation rate(2)
    
    
    4.0
    
    
    
    5.2
    
    
    
    3.3U.S. inflation rate
    
    
    1.9
    
    
    
    3.3
    
    
    
    3.4Increase in Mexican GDP(3)
    
    
    1.4
    
    
    
    4.2
    
    
    
    3.0
 
 (1)
    
    Based on changes in the Interbank Rates, as reported by Banamex, at the end of each
period, which were as follows: Ps.10.464 per U.S. Dollar as of December 31, 2002; Ps.11.225
per U.S. Dollar as of December 31, 2003; Ps.11.149 per U.S. Dollar as of December 31, 2004;
and Ps.10.6265 per U.S. Dollar as of December 31, 2005.(2)
    
    Based on changes in the NCPI from the previous period, as reported by the Mexican
Central Bank, which were as follows: 102.9 in 2002; 107.0 in 2003; 112.5 in 2004; and 116.3
in 2005.(3)
    
    As reported by the Instituto Nacional de Estadística, Geografía e Informática, or
INEGI, and, in the case of GDP information for 2003, 2004 and 2005 as estimated by INEGI.  
    
    Advertising and other revenues.Inflation in Mexico adversely affects
consumers. As a result, our advertising customers may purchase less advertising, which
would reduce our advertising revenues, and consumers may reduce expenditures for our
other products and services, including pay television services.
    
    U.S. Dollar-denominated revenues and operating costs and expenses.We have
substantial operating costs and expenses denominated in U.S. Dollars. These costs are
principally due to our activities in the United States, the costs of foreign-produced
programming and publishing supplies and the leasing of satellite transponders. The
following table sets forth our U.S. Dollar-denominated revenues and operating costs and
expenses for 2003, 2004 and 2005:
 Year Ended December 31,2003
    
    
    2004
    
    
    2005(Millions of U.S. Dollars)Revenues
    
    
    U.S.$414
    
    
    
    U.S.$435
    
    
    
    U.S.$385Operating costs and expenses
    
    
    411
    
    
    
    443
    
    
    
    393
  
    
    Depreciation and amortization expense.We restate our non-monetary Mexican and foreign
assets to give effect to inflation. The restatement of these assets in periods of high
inflation, as well as the devaluation of the Peso as compared to the U.S. Dollar, increases
the carrying value of these assets, which in turn increases the related depreciation
expense.
 - 78 -




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
    
    Integral cost of financing.The devaluation of the Peso as compared to the U.S. Dollar
generates foreign exchange losses relating to our net U.S. Dollar-denominated liabilities
and increases the Peso equivalent of our interest expense on our U.S. Dollar-denominated
indebtedness. Foreign exchanges losses, derivatives used to hedge foreign exchange risk and
increased interest expense increase our integral cost of financing.
   Inflation under Mexican GAAP.
 
    
    restatement of Mexican non-monetary assets (other than transmission rights, inventories
and equipment of non-Mexican origin), non-monetary liabilities and shareholders equity
using the NCPI; and
    
    restatement of all inventories at net replacement cost.
 U.S. GAAP Reconciliation
  Recently Issued U.S. Accounting Standards
   - 79 -




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New Mexican Financial Reporting Standards
   - 80 -




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Critical Accounting Policies
  Accounting for Programming
   Equity Investments
   - 81 -




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Goodwill and Other Indefinite-lived Intangible Assets
  Long-lived Assets
 Deferred Income Taxes
 - 82 -




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Liquidity, Foreign Exchange and Capital Resources
 Liquidity.
  Cash Basis Income.
  
    
    a Ps.2,234.6 million increase in operating income; and
    
    a Ps.112.8 million decrease in other expense, net.
  
    
    a Ps.973.6 million increase in income and assets taxes and employees profit sharing;
    
    a Ps.200.1 million increase in integral cost of financing, which was due primarily to
an increase in foreign exchange loss; and
    
    a Ps.23.1 million increase in restructuring and non-recurring charges.
  
    
    a Ps.2,757.6 million increase in operating income;
    
    a Ps.557.6 million decrease in income and assets taxes and employees profit sharing; and
 - 83 -




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
    
    a Ps.557.1 million decrease in restructuring and non-recurring charges.
  
    
    a Ps.865.9 million increase in integral cost of financing, which was due primarily to
an increase in interest expense and foreign exchange loss; and
    
    a Ps.142.8 million increase in other expense, net.
  
    
    a Ps.1,335.4 million increase in operating income;
    
    a Ps.337.4 million decrease in other expense, net;
    
    a Ps.237.1 million decrease in restructuring and non-recurring charges; and
    
    a Ps.24.8 million decrease in integral cost of financing, which was due primarily to an
increase in interest income and a decrease in interest expense.
  Capital Expenditures, Acquisitions and Investments, Distributions and Other Sources of
Liquidity.
  
    
    make aggregate expenditures for property, plant and equipment of approximately
U.S.$300.0 million, which amount includes capital expenditures in amount of U.S.$52.0
million, U.S.$90.0 million, U.S.$45.0 million and approximately U.S.$19 million for the
expansion and improvements of our Cable Television segment, Sky Mexico segment and gaming
business, and in-store television advertising systems for 19 Wal-Mart de México stores,
respectively; and
    
    make aggregate investments of approximately U.S.$272.4
million, which amount includes investments of approximately
U.S.$108.0 million, U.S.$58.7 million and U.S.$15.0 million related
to La Sexta, two-thirds of the former Liberty Media's stake in
Innova, and the acquisition of certain operating assets of a
publishing company in Mexico and Latin America, respectively, as well
as U.S.$90.7 million in connection with other potential investments
and acquisitions of our different business segments.
  
    
    made aggregate capital expenditures for property, plant and equipment of approximately
U.S.$248.3 million, which amount includes capital expenditures in the amount of U.S.$51.1
million and U.S.$109.2 million for the expansion and improvement of our Cable Television
and Sky Mexico segments, respectively;
    
    invested a capital contribution of U.S.$25.0 million in Volaris, a new,
low-cost-carrier airline with a concession to operate in Mexico, and made a capital
contribution of U.S.$1.4 million related to our Spanish venture, La Sexta; and
    
    contributed Ps.5.0 million (nominal) to fund our seniority premium obligations.
 - 84 -




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
    
    made aggregate capital expenditures for property, plant and equipment of approximately
U.S.$174.6 million, which amount includes capital expenditures in the amount of U.S.$35.1
million and U.S.$57.6 million for the expansion and improvement of our Cable Television and
Sky Mexico segments, respectively;
    
    invested an aggregate of U.S.$12.5 million in our Latin America DTH joint ventures in
the form of long-terms loans and/or capital contribution; and
    
    contributed Ps.69.9 million (nominal) to fund our seniority premium obligations.
  Refinancings.
      - 85 -




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Indebtedness.
 Debt Outstanding(1)December 31, 2005Description of Debt
    
    Actual
    
    
    Interest Rate(2)
    
    
    Denomination
    
    
    Maturity of DebtLong-term debtSeries B Senior Notes(3)
    
    Ps.
    57
    
    
    
    11.875
    %
    
    U.S. Dollars
    
    
    20068% Senior Notes(4)(5)
    
    
    802
    
    
    
    8.0
    %
    
    U.S. Dollars
    
    
    20118.5% Senior Notes(4)(6)
    
    
    3,188
    
    
    
    8.5
    %
    
    U.S. Dollars
    
    
    20326 5/8% Senior Notes(4)(7)
    
    
    6,376
    
    
    
    6.625
    %
    
    U.S. Dollars
    
    
    2025Innovas 9 3/8% Senior Notes(8)
    
    
    3,188
    
    
    
    9.375
    %
    
    U.S. Dollars
    
    
    2013UDI-denominated notes
    
    
    941
    
    
    
    8.15
    %
    
    UDIs (Peso- Indexed)
    
    
    2007Banamex loan(9)
    
    
    2,000
    
    
    
    10.35
    %
    
    Pesos
    
    2010 and 2012Banamex loan(10)
    
    
    720
    
    
    
    8.925
    %
    
    Pesos
    
    
    2006-2008Banamex loan(11)
    
    
    1,162
    
    
    
    9.70
    %
    
    Pesos
    
    
    2009Other debt(12)
    
    
    44
    
    
    
    5.61
    %
    
    Various
    
    
    2006-2010Total debt (including current maturities)
    
    
    18,478
    
    
    
    
    
    
    
    

    
    13.80 years(13)Less: current maturities
    
    
    341
    
    
    
    
    
    
    Various
    
    December 2006Total long-term debt
    
    Ps.
    18,137
 
 (1)
    
    U.S. Dollar-denominated debt is translated into Pesos at an exchange rate of Ps.10.6265 per
U.S. Dollar, the Interbank Rate, as reported by Banamex, as of December 31, 2005.(2)
    
    Excludes additional amounts payable in respect of Mexican withholding taxes. See Additional
Information  Taxation  Mexican Taxes.(3)
    
    Interest on the Series B Senior Notes is payable semi-annually. The Series B Notes bear
interest at an effective rate of 12.49%. The Series B Senior Notes are redeemable by us in the
event of certain changes in the law affecting the Mexican withholding tax treatment of certain
payments we make on the Series B Senior Notes, as well as at our option in certain cases. See
Note 8 to our year-end financial statements.(4)
    
    Interest is payable semi-annually on each of the 8.0% Senior Notes due 2011, the 8.5% Senior
Notes due 2032 and the 6 5/8% Senior Notes due 2025. The 8.0% Senior Notes due 2011, the 8.5%
Senior Notes due 2032 and the 6 5/8% Senior Notes due 2025 bear interest at an effective rate
of 9.07%, 8.41%, 8.94% and 6.97%, respectively. The 8.0% Senior Notes due 2011, the 8.5%
Senior Notes - 86 -




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due 2032 and the 6 5/8% Senior Notes due 2025 are redeemable by us in the event of certain
changes in the law affecting the Mexican withholding tax treatment of certain payments we
make in respect of these notes, as well as at our option in certain cases. See Note 8 to our
year-end financial statements.(5)
    
    Reflects the issuance of U.S.$300.0 million aggregate principal amount of 8.0% Senior Notes
due 2011 issued on September 13, 2001. We applied the net proceeds from this issuance,
together with cash on hand, to repay approximately U.S.$300.0 million of the U.S.$400.0
million of indebtedness then outstanding under our prior U.S.$400.0 million term loan
facility. As described below, we registered substantially all of these notes through an
exchange offer in March 2002.(6)
    
    Reflects the issuance of U.S.$300.0 million aggregate principal amount of 8.5% Senior Notes
due 2032 issued on March 1, 2002. We applied a substantial portion of the net proceeds from
this issuance to repay all of the U.S.$276.0 million of indebtedness then outstanding under
our bridge loan facility. In July 2002, we registered all of our 8.5% Senior Notes due 2032
pursuant to an exchange offer. See Note 9 to our year-end financial statements.(7)
    
    Reflects the issuance of U.S.$400.0 million and U.S.$200.0 million aggregate principal amount
of 6 5/8% Senior Notes due 2025 issued on March 18, 2005 and May 23, 2005, respectively. We
applied the U.S.$400.0 million proceeds, together with cash on hand, to fund our tender offers
for any or all of our U.S.$300.0 million aggregate principal amount outstanding of our 8.00%
Senior Notes due 2011 and our Ps.3,839 million (equivalent to approximately U.S.$336.9
million) aggregate principal amount of 8.15% UDI-denominated Notes due 2007. The net proceeds
of the U.S.$200.0 million issuance were used for general corporate purposes, including the
prepayment of some of our companys outstanding indebtedness. See Note 8 to our year-end
financial statements.(8)
    
    In September 2003, Innova completed the offering of these U.S.$300.0 million Senior Notes,
bearing an interest at a coupon rate of 9.375%, payable semi-annually. These securities are
unsecured and unsubordinated indebtedness of Innova and contain certain restrictive covenants
for Innova on additional indebtedness, liens, sales and leasebacks, restricted payments, asset
sales, and certain mergers, consolidations and similar transactions. On April 25, 2006 Innova
completed a cash tender offer to purchase any and all of its 9.375% Senior Notes, and 96.25%
of the Notes were tendered at a price of 112.329, which represented a total amount of US$324.3
million that Innova paid in connection with the tender offer on April 28, 2006. Innova
entered into two bank loans, both of them in Mexican pesos and guaranteed by us, in order to
pay for the above transaction. Currently there are only US$11.3 million outstanding of
Innovas 9.375% Senior Notes, which Innova may, at its own option, redeem these Senior Notes,
in whole or in part, at any time on or after September 19, 2008 at redemption prices from
104.6875% to 101.5625% between September 19, 2008 through September 18, 2011, or 100%
commencing on September 19, 2011, plus accrued and unpaid interest, if any.(9)
    
    In October 2004, we entered into a long-term credit agreement with Banamex in the aggregate
principal amount of Ps.2,000.0 million, which matures in 2010 (50%) and 2012 (50%). Interest
on this loan is 10.35% per annum, and is payable on a monthly basis. The proceeds of this loan
are intended to be used principally to prefund a portion of our debt maturing in August 2005.(10)
    
    In May 2003, we entered into a long-term credit agreement with Banamex for an aggregate
principal amount of Ps.800.0 million, with two tranches of Ps.400.0 million each. The annual
interest rate for the first tranche equals 9.35% plus additional basis points from 0 to 45
based on the maintenance of certain financial coverage ratios related to indebtedness (the
additional basis points), and an annual interest rate for the second tranche equal to the
Mexican interbank rate plus 40 basis points plus additional basis points. Interest due in
connection with this credit agreement is payable on a 28-day basis. This indebtedness has two
semi-annual maturities of Ps.40.0 million each in 2004, two semi-annual maturities of Ps.120.0
million each in 2006 and two quarterly maturities of Ps.240.0 million each in 2008. This
credit agreement was subsequently amended to reflect a fixed annual interest rate of 8.50%
plus additional basis points for the second tranche beginning in the third quarter of 2003.(11)
    
    In May 2004, we entered into a long-term credit agreement with Banamex for an aggregate
principal amount of Ps.1,162.5 million, which matures in 2009. The annual interest rate of
this indebtedness equals 9.70% and is payable on a monthly basis.(12)
    
    Includes outstanding indebtedness in the aggregate amount of Ps.44.0 million under the
following bank loans and capital leases: 
    
    Ps.1.0 million in capital lease obligations. These obligations bear interest at
a variable annual rate between 13% and 17% and have maturities ranging from 2006 to
2009; and
    
    Ps.43.0 million in other bank loans, which are denominated in U.S. Dollars.
These bank loans bear interest at a variable annual rate between 0.11 and 1.25 points
above LIBOR and have maturities ranging from 2006 and 2010.
 
 (13)
    
    Actual weighted average maturity of long-term debt as of December 31, 2005.  - 87 -




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##### Table of Contents




    
    incur indebtedness;
    
    make dividend payments;
    
    issue and sell capital stock of restricted subsidiaries; and
    
    consummate mergers and consolidations, liquidations, dissolutions or transfers of assets.
  
    
    a total net debt/EBITDA ratio (as defined) not greater than 3.50 to 1.00; and
 - 88 -




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##### Table of Contents




    
    a EBITDA/cash interest ratio (as defined) not less than 1.50 to 1.00.
   Interest Expense.
  Year Ended December 31,(1)(2)2003
    
    
    2004
    
    
    2005(Millions of U.S. Dollars)Interest payable in U.S. Dollars
    
    U.S.$
    70.2
    
    
    U.S.$
    110.0
    
    
    U.S.$
    118.0Amounts currently payable under Mexican
withholding taxes(3)
    
    
    3.4
    
    
    
    5.0
    
    
    
    6.3Total interest payable in U.S. Dollars
    
    U.S.$
    73.6
    
    
    U.S.$
    115.0
    
    
    U.S.$
    124.3Peso equivalent of interest payable in U.S. Dollars
    
    Ps.
    882.8
    
    
    Ps.
    1,379.3
    
    
    Ps.
    1,377.7Interest payable in Pesos
    
    
    461.2
    
    
    
    608.1
    
    
    
    725.0Restatement of UDI-denominated Notes due 2007
    
    
    151.4
    
    
    
    177.8
    
    
    
    31.8Total interest expense(4)
    
    Ps.
    1,495.4
    
    
    Ps.
    2,165.2
    
    
    Ps.
    2,134.5
 
 (1)
    
    U.S. Dollars are translated into Pesos at the rate prevailing when interest was recognized
as an expense for each period and restated to Pesos in purchasing power as of December 31,
2005.(2)
    
    Interest expense in these periods includes amounts effectively payable in U.S. Dollars as a
result of U.S. Dollar-Peso swaps.(3)
    
    See Additional Information  Taxation  Mexican Taxes.(4)
    
    Total interest expense amounts in these periods exclude capitalized and hedged interest
expense. Guarantees.
 - 89 -




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Contractual Obligations and Commercial Commitments
  Contractual Obligations on the Balance Sheet
  Payments Due by PeriodLess Than12 Months
    
    
    12-36 Months
    
    
    36-60 Months
    
    
    After 60 MonthsJanuary 1, 2006 to
    
    
    January 1, 2007 to
    
    
    January 1, 2009 to
    
    
    Subsequent toTotal
    
    
    December 31, 2006
    
    
    December 31, 2008
    
    
    December 31, 2010
    
    
    December 31, 2010(Thousands of U.S. Dollars)Series B Senior Notes
    
    U.S.$
    5,343
    
    
    U.S.$
    5,343
    
    
    U.S.$
    
    
    
    U.S.$
    
    
    
    U.S.$
    8% Senior Notes
    
    
    75,484
    
    
    
    3,533
    
    
    
    
    
    
    
    
    
    
    
    71,9518.5% Senior Notes
    
    
    300,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    300,0006.625% Senior Notes
    
    
    600,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    600,000Innovas 9.375% Senior Notes
    
    
    300,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    300,000UDI-denominated Notes
    
    
    88,559
    
    
    
    
    
    
    
    88,559
    
    
    
    
    
    
    
    Banamex loan II
    
    
    67,755
    
    
    
    22,585
    
    
    
    45,170
    
    
    
    
    
    
    
    Banamex loan III
    
    
    109,393
    
    
    
    
    
    
    
    
    
    
    
    109,393
    
    
    
    Banamex loan IV
    
    
    188,209
    
    
    
    
    
    
    
    
    
    
    
    94,104
    
    
    
    94,105Other debt
    
    
    4,089
    
    
    
    577
    
    
    
    921
    
    
    
    2,591
    
    
    
    Long-term debt
    
    
    1,738,832
    
    
    
    32,038
    
    
    
    134,650
    
    
    
    206,088
    
    
    
    1,366,056Satellite transponder obligation
    
    
    118,810
    
    
    
    7,115
    
    
    
    16,922
    
    
    
    21,274
    
    
    
    73,499Transmission rights(1)
    
    
    80,496
    
    
    
    54,029
    
    
    
    19,791
    
    
    
    6,676
    
    
    
    Total contractual obligations
    
    U.S.$
    1,938,138
    
    
    U.S.$
    93,182
    
    
    U.S.$
    171,363
    
    
    U.S.$
    234,038
    
    
    U.S.$
    1,439,555
 
 (1)
    
    This liability reflects our transmission rights obligations related to programming
acquired or licensed from third party producers and suppliers, and special events, which are
reflected for in our consolidated balance sheet within trade accounts payable (current
liabilities) and other long-term liabilities. Contractual Obligations off the Balance Sheet
  - 90 -




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Payments Due by PeriodLess than12 Months
    
    
    12-36 Months
    
    
    36-60 Months
    
    
    After 60 MonthsJanuary 1, 2006 to
    
    
    January 1, 2007 to
    
    
    January 1, 2009 to
    
    
    Subsequent toTotal
    
    
    December 31, 2006
    
    
    December 31, 2008
    
    
    December 31, 2010
    
    
    December 31, 2010(Thousands of U.S. Dollars)Capital expenditures commitments(1)
    
    U.S.$
    18,099
    
    
    U.S.$
    18,099
    
    
    U.S.$
    
    
    
    U.S.$
    
    
    
    U.S.$
    Guarantees(2)
    
    
    12,534
    
    
    
    
    
    
    
    12,534
    
    
    
    
    
    
    
    Other(3)
    
    
    11,056
    
    
    
    11,056
    
    
    
    
    
    
    
    
    
    
    
    Total contractual obligations
    
    U.S.$
    41,689
    
    
    U.S.$
    29,155
    
    
    U.S.$
    12,534
    
    
    U.S.$
    
    
    
    U.S.$
    
 
 (1)
    
    Our commitments for capital expenditures include U.S.$13,631, which are related to
commitments to Sky Mexico projects.(2)
    
    In connection with the disposal of our investment in PanAmSat in 1997, we granted
collateral to secure certain indemnification obligations. After the expiration of applicable
tax statutes of limitations, the collateral will be reduced to a de minimis amount. The
collateral agreement will terminate in approximately two years.(3)
    
    In 2001, we entered into a 50/50 programming joint venture with Endemol, an
international content developer and producer for television and online platforms based in the
Netherlands, to produce and develop content for television and the Internet. As of December
31, 2005, we have commitments to acquire from Endemol programming formats through this joint
venture up to in the aggregate U.S.$11.1 million through 2006. - 91 -




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##### Table of Contents



Item 6. Directors, Senior Management and Employees
 Board of Directors
  Name and Date of Birth
    
    Principal Occupation
    
    Business Experience
    
    First ElectedEmilio Azcárraga
Jean (02/21/68)
    
    Chairman of the Board,
President and Chief
Executive Officer and
President of the
Executive Committee of
Grupo Televisa
    
    Member of the
Boards of Teléfonos
de México, S.A. de
C.V. and Banco
Nacional de México,
S.A. and former
Vice Chairman of
the Board of
Univision
    
    December 1990In alphabetical order:Alfonso de Angoitia
Noriega (01/17/62)
    
    Executive Vice President
and Member of the
Executive Office of the
Chairman and Member of
the Executive Committee
of Grupo Televisa
    
    Former Chief
Financial Officer
of Grupo Televisa
and former
Alternate Member of
the Board of
Univision and
Partner, Mijares,
Angoitia, Cortés y
Fuentes, S.C.
(1994-1999)
    
    April 1998María Asunción
Aramburuzabala Larregui
(05/02/63)
    
    Vice Chairwoman of the
Board and Member of the
Executive Committee of
Grupo Modelo, S.A. de
C.V.
    
    Chief Executive
Officer of Tresalia
Capital, S.A. de
C.V. and Member of
the Boards of Grupo
Financiero Banamex,
S.A. de C.V., Banco
Nacional de México,
S.A. and América
Móvil, S.A. de C.V.
    
    July 2000Pedro Aspe Armella
(07/07/50)
    
    Chairman of the Board and
Chief Executive Officer
of Protego Asesores, S.A.
de C.V.
    
    Member of the
Boards of The
McGraw-Hill
Companies and
Xignux and former
Member of the Board
of Vector Casa de
Bolsa, S.A. de C.V.
    
    April 2003Julio Barba Hurtado
(05/20/33)
    
    Legal Advisor to the
President, Prosecretary
to the Board and the
Executive Committee of
Grupo Televisa and
Secretary to the Audit
Committee of Grupo
Televisa
    
    Former Legal
Advisor to
Televisa, S.A. de
C.V.
    
    December 1990José Antonio Bastón
Patiño (04/13/68)
    
    Corporate Vice President
of Television and Member
of the Executive
Committee of Grupo
Televisa
    
    Former Vice
President of
Operations of Grupo
Televisa, former
General Director of
Programming of
Grupo Televisa and
former Member of
the Board of
Univision
    
    April 1998
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Name and Date of Birth
    
    Principal Occupation
    
    Business Experience
    
    First ElectedAlberto Bailleres
González (08/22/31)
    
    President of Grupo Bal
    
    Member of the
Boards of Valores
Mexicanos, Casa de
Bolsa, S.A. de
C.V., Desc., S.A.
de C.V., Fomento
Económico Mexicano,
S.A. de C.V.
(FEMSA), Grupo
Financiero BBVA
Bancomer, S.A. de
C.V., Industrias
Peñoles, S.A. de
C.V., Grupo
Nacional
Provincial, S.A.,
Grupo Palacio de
Hierro, S.A. de
C.V., Profuturo
GNP, S.A. de C.V.,
Aseguradora
Porvenir GNP, S.A.
de C.V. and
President of the
Board of Governors
of the Instituto
Tecnológico
Autónomo de México,
A.C. (ITAM)
    
    April 2005Manuel Jorge Cutillas
Covani (03/01/32)
    
    Director of Grupo Televisa
    
    Member of the Board
of Bacardi Limited
and former Chairman
of the Board of
Bacardi Limited
    
    April 1994Carlos Fernández González
(09/29/66)
    
    Chief Executive Officer
and Chairman of the Board
of Grupo Modelo, S.A. de
C.V.
    
    Member of the
Boards of Anheuser
Busch Co., Grupo
Financiero
Santander Mexicano,
S.A. de C.V. and
Emerson Electric,
Co.
    
    July 2000Bernardo Gómez Martínez
(07/24/67)
    
    Executive Vice President
and Member of the
Executive Office of the
Chairman and Member of
the Executive Committee
of Grupo Televisa
    
    Former President of
the Mexican Chamber
of Television and
Radio Broadcasters
and Deputy to the
President of Grupo
Televisa
    
    April 1999Claudio X. González
Laporte (05/22/34)
    
    Chairman of the Board and
Chief Executive Officer
of Kimberly-Clark de
México, S.A. de C.V.
    
    Member of the
Boards of
Kimberly-Clark
Corporation,
General Electric
Co., Kellogg
Company, Home
Depot, Inc., Alfa,
S.A. de C.V., Grupo
Carso, S.A. de
C.V., América
Móvil, S.A. de C.V.
and Investment
Company of America,
and former
President of the
Mexican Business
Council
    
    April 1997Roberto Hernández Ramírez
(03/24/42)
    
    Chairman of the Board of
Banco Nacional de México,
S.A.
    
    Former Chief
Executive Officer
of Banco Nacional
de México, S.A. and
Member of the
Boards of
Citigroup, Inc.,
Gruma, S.A. de
C.V., Grupo
Financiero Banamex
Accival, S.A. de
C.V., and the
Nature Conservancy
and World Monuments
Fund
    
    April 1992Enrique Krauze Kleinbort
(09/17/47)
    
    Chief Executive Officer
of Editorial Clío Libros
y Videos, S.A. de C.V.
    
    General Director of
Editorial Clío
Libros y Videos,
S.A. de C.V.
    
    April 1996
 - 93 -




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Name and Date of Birth
    
    Principal Occupation
    
    Business Experience
    
    First ElectedGermán Larrea Mota
Velasco (10/26/53)
    
    Chairman of the Board,
Chief Executive Officer
and President of Grupo
México, S.A. de C.V.
    
    Chairman of the
Board and Chief
Executive Officer
of Asarco
Incorporated,
Southern Peru
Copper Corporation
and Grupo
Ferroviario
Mexicano, S.A. de
C.V. and former
Member of the
Boards of Banco
Nacional de México,
S.A. and Bolsa
Mexicana de
Valores, S.A. de
C.V.
    
    April 1999Gilberto Pérezalonso
Cifuentes (03/06/43)
    
    Chief Executive Officer
of Corporación GEO, S.A.
de C.V. and Member of the
Audit Committee of Grupo
Televisa
    
    Member of the
Boards of Grupo
Gigante, S.A. de
C.V., Southern Peru
Copper Corporation
and Afore Banamex,
S.A.
    
    April 1998Carlos Slim Domit
(02/28/67)
    
    Chairman of the Board of
Grupo Carso, S.A. de C.V.
and Teléfonos de México,
S.A. de C.V. and
President of Grupo
Sanborns, S.A. de C.V.
    
    Vice Chairman of
America Telecom,
S.A. de C.V. and
Member of the
Boards of Grupo
Condumex, S.A. de
C.V., Phillip
Morris Mexico, S.A.
de C.V. and Sears
Roebuck de Mexico,
S.A. de C.V.
    
    April 2004Alejandro Quintero
Iñiguez (02/11/50)
    
    Corporate Vice President
of Sales and Marketing
and Member of the
Executive Committee of
Grupo Televisa
    
    Shareholder of
Grupo TV Promo,
S.A. de C.V. and
former Advisor to
former Mexican
President Ernesto
Zedillo
    
    April 1998Fernando Senderos Mestre
(03/03/50)
    
    Chairman of the Board and
Chief Executive Officer
of Desc, S.A. de C.V.
    
    Member of the
Boards of Teléfonos
de México, S.A. de
C.V., Alfa, S.A. de
C.V., Kimberly
Clark de México,
S.A. de C.V. and
Industrias Peñoles,
S.A. de C.V.
    
    April 1992Enrique F. Senior
Hernández (08/03/43)
    
    Executive Vice President
and Managing Director of
Allen & Company
Incorporated
    
    Member of the Board
of Pics Retail
Networks and Member
of the Board of
Coca Cola Femsa and
Member of the Board
of Cinemark
    
    April 2001Lorenzo H. Zambrano
Treviño (03/27/44)
    
    Chairman of the Board and
Chief Executive Officer
of Cemex, S.A. de C.V.
    
    Member of the
Boards of Alfa,
S.A. de C.V.,
Empresas ICA,
Sociedad
Controladora, S.A.
de C.V., Fomento
Económico Mexicano,
S.A. de C.V. and
Vitro, S.A. de C.V.
    
    April 1999
 - 94 -




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Name and Date of Birth
    
    Principal Occupation
    
    Business Experience
    
    First ElectedAlternate Directors:In alphabetical order:Herbert Allen III
(06/08/67)
    
    Executive Vice
President and
Managing Director
of Allen & Company
Incorporated
    
    Member of the
Boards of Coca Cola
Femsa, S.A. de
C.V.,
Convera-Enterprise
Software and Global
Education Network
    
    April 2002Juan Pablo Andrade Frich
(06/05/64)
    
    Asset Manager of
Tresalia Capital,
S.A. de C.V. and
Member of the
Executive and Audit
Committee of Grupo
Televisa
    
    Former Member of
the Board of
Televicentro and
Member of the Board
of Empresas
Cablevisión, S.A.
de C.V.
    
    July 2000Lucrecia Aramburuzabala
Larregui (03/29/67)
    
    Private Investor
    
    Employee of
Tresalia Capital,
S.A. de C.V. and
Member of the Board
of Grupo Modelo,
S.A. de C.V. and
former Member of
the Board of
Televicentro
    
    July 2000Félix Araujo Ramírez
(03/20/51)
    
    Vice President of
Telesistema
Mexicano
    
    Former Private
Investor in
Promoción y
Programación de la
Provincia, S.A. de
C.V., Promoción y
Programación del
Valle de Lerma,
S.A. de C.V.,
Promoción y
Programación del
Sureste, S.A. de
C.V., Teleimagen
Profesional del
Centro, S.A. de
C.V. and Estrategia
Satélite, S.C.
    
    April 2002Maximiliano Arteaga
Carlebach (12/06/42)
    
    Vice President of
Operations,
Technical Service
and Television
Production of Grupo
Televisa
    
    Former Vice
President of
Operations 
Televisa
Chapultepec, former
Vice President of
Administration 
Televisa San Angel
and Chapultepec and
former Vice
President of
Administration and
Finance of Univisa,
Inc.
    
    April 2002Joaquín Balcárcel Santa
Cruz (01/04/69)
    
    Vice President 
Legal and General
Counsel of Grupo
Televisa
    
    Former Director,
Legal Department
and Vice President
 Legal General
Counsel Television
Division of Grupo
Televisa and former
associate at
Martínez, Algaba,
Estrella, De Haro y
Galván-Duque, S.C.
    
    April 2000Juan Fernando Calvillo
Armendáriz (12/27/41)
    
    Vice President of
Internal Auditing
and Executive
Secretary of the
Audit Committee of
Grupo Televisa
    
    Member of the Board
of Private Banking
of Vanguardia, S.A.
de C. V. and former
Member of the
Boards of Grupo
Financiero Serfin,
S.A. de C.V. and
Serpaprosa, S.A. de
C.V.
    
    April 2002
 - 95 -




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Name and Date of Birth
    
    Principal Occupation
    
    Business Experience
    
    First ElectedRafael Carabias Príncipe
(11/13/44)
    
    Chief Financial
Officer of Gestora
de Inversiones
Audiovisuales La
Sexta, S.A.
    
    Former Member of
the Boards of
Promecap, S.C. and
Grupo Financiero
del Sureste, S.A.,
former Director of
Corporate Finance
of Scotiabank
Inverlat, S.A. and
former Vice
President of
Administration of
Grupo Televisa
    
    April 1999Francisco José Chévez
Robelo (07/03/29)
    
    Retired Partner of
Chévez, Ruiz,
Zamarripa y Cía,
S.C. and Chairman
of the Audit
Committee of Grupo
Televisa
    
    Member of the Board
of Empresas
Cablevisión, S.A.
de C.V. and former
Partner of Chévez,
Ruiz, Zamarripa y
Cía, S.C.
    
    April 2003José Luis Fernández
Fernández (05/18/59)
    
    Partner of Chévez,
Ruiz, Zamarripa y
Cia., S.C.
    
    Former Member of
the Boards of
Alexander Forbes,
S.A. de C.V. and
Afore Bital, S.A.
    
    April 2002Salvi Folch Viadero
(08/16/67)
    
    Chief Financial
Officer of Grupo
Televisa
    
    Former Vice
President of
Financial Planning
of Grupo Televisa,
Chief Executive
Officer and Chief
Financial Officer
of Comercio MAS,
S.A. de C.V. and
former Vice
Chairman of Banking
Supervision of the
National Banking
and Securities
Commission
    
    April 2002Leopoldo Gómez González
Blanco (04/06/59)
    
    Vice President of
Newscasts of Grupo
Televisa
    
    Former Director of
Information to the
President of Grupo
Televisa
    
    April 2003José Heredia Bretón
(06/16/61)
    
    Director of
Sociedad de
Inversión de
Capitales of Grupo
Financiero Inbursa,
S.A.
    
    Member of the Board
of Banco Inbursa,
S.A. , Member of
the Board of
Aseguradora
Inbursa, S.A. de
C.V. and former
Director of Retail
Business of Grupo
Financiero Inbursa,
S.A.
    
    April 2004José Antonio Lara del
Olmo (09/02/70)
    
    Vice President 
Tax of Grupo
Televisa
    
    Former Tax Director
of Grupo Televisa
and former
Associate of
Chévez, Ruiz,
Zamarripa y Cía,
S.C.
    
    April 2003Jorge Lutteroth Echegoyen
(01/24/53)
    
    Vice President
Controller of Grupo
Televisa
    
    Former Senior
Partner of Coopers
& Lybrand Despacho
Roberto Casas
Alatriste, S.C.
    
    April 2000Alberto Montiel
Castellanos (11/22/45)
    
    Director of Montiel
Font y Asociados,
S.C. and Member of
the Audit Committee
of Grupo Televisa
    
    Former Tax Director
of Wal-Mart de
México, S.A. de
C.V.
    
    April 2002Raúl Morales Medrano
(05/12/70)
    
    Partner of Chévez,
Ruiz, Zamarripa y
Cia, S.C.
    
    Former Senior
Manager of Chévez,
Ruiz, Zamarripa y
Cia, S.C.
    
    April 2002
 - 96 -




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Name and Date of Birth
    
    Principal Occupation
    
    Business Experience
    
    First ElectedGuillermo Nava Gómez
Tagle (08/27/43)
    
    Vice President of
Administration 
Televisa San Angel
    
    Former Vice
President of
Corporate Finance
of Grupo Televisa,
former Vice
President of
Citibank  Colombia
and former Finance
Director of CIFRA
    
    April 1999Alexandre Moreira Penna
Da Silva (12/25/54)
    
    Chief Executive
Officer of Innova
    
    Former Vice
President of
Corporate Finance
of Grupo Televisa
and former Managing
Director of
JPMorgan Chase
    
    April 2002
   Our Board of Directors
 General.
 
    
    one of our employees or managers;
    
    a controlling shareholder, in our case, the beneficiaries of the Shareholder Trust;
    
    a partner or employee of a company which provides advisory services to us or any
company which is part of the same economic group as we are, that receives 10% or more of
its income from us;
    
    a significant client, supplier, debtor or creditor, or member of the Board or executive
officer of any such entities;
    
    an employee of any association, foundation, or partnership that receives at least 5% of
its total donations from us; or
    
    any high level executive officer of a corporation in which one of our high level
executives is a member of the Board of Directors of that corporation.
 Election of Directors.
 - 97 -




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Quorum; Voting.
 Meetings; Actions Requiring Board Approval.
 Committees of Our Board of Directors.
 
    
    prepare an annual report regarding its activities for submission to the Board and to
our shareholders at our annual shareholders meeting;
    
    render an opinion as to transactions and arrangements with related parties, which must
be approved by our Board of Directors; and
    
    propose independent experts to render opinions in connection with transactions that
deviate from our ordinary course of business, and which involve, among other things, (i) a
related party, (ii) any purchase or
sale of 10% or more of our assets, (iii) the grant by us of guarantees in an amount or
amounts exceeding 30% of our assets or (iv) other transactions representing more than 1% of
our assets.
 Executive Officers
  Name and Date of Birth
    
    Current Position
    
    Business Experience
    
    First AppointedEmilio Azcárraga
Jean (02/21/68)
    
    Chairman of the
Board, President
and Chief Executive
Officer and
President of the
Executive Committee
of Grupo Televisa
    
    Member of the
Boards of Teléfonos
de México, S.A. de
C.V. and Banco
Nacional de México,
S.A. and former
Vice Chairman of
the Board of
Univision
    
    March 1997
 - 98 -




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##### Table of Contents



Name and Date of Birth
    
    Current Position
    
    Business Experience
    
    First AppointedIn alphabetical order:Alfonso de Angoitia
Noriega (01/17/62)
    
    Executive Vice
President and
Member of the
Executive Office of
the Chairman and
Member of the
Executive Committee
of Grupo Televisa
    
    Former Chief
Financial Officer
of Grupo Televisa,
Member of the Board
and of the
Executive Committee
of Grupo Televisa,
former Alternate
Member of the Board
of Univision and
Partner, Mijares,
Angoitia, Cortés y
Fuentes, S.C.
(1994-1999)
    
    January 2004Félix José Araujo Ramírez
(03/20/51)
    
    Vice President of
Telesistema
Mexicano
    
    Former Private
Investor in
Promoción y
Programación de la
Provincia, S.A. de
C.V., Promoción y
Programación del
Valle de Lerma,
S.A. de C.V.,
Promoción y
Programación del
Sureste, S.A. de
C.V., Teleimagen
Profesional del
Centro, S.A. de
C.V. and Estrategia
Satélite, S.C.
    
    January 1993Maximiliano Arteaga
Carlebach (12/06/42)
    
    Vice President of
Operations,
Technical Service
and Television
Production of Grupo
Televisa
    
    Former Vice
President of
Operations 
Televisa
Chapultepec, former
Vice President of
Administration 
Televisa San Angel
and Chapultepec and
former Vice
President of
Administration and
Finance of Univisa,
Inc.
    
    March 2002José Antonio Bastón
Patiño (04/13/68)
    
    Corporate Vice
President of
Television of Grupo
Televisa
    
    Member of the Board
and of the
Executive Committee
of Grupo Televisa,
former Vice
President of
Operations of Grupo
Televisa, former
General Director of
Programming of
Grupo Televisa and
former Member of
the Board of
Univision
    
    February 2001Jean Paul Broc Haro
(08/08/62)
    
    Chief Executive
Officer of
Cablevisión
    
    Former General
Manager of Pay
Television Networks
of Grupo Televisa
    
    February 2003Salvi Folch Viadero
(08/16/67)
    
    Chief Financial
Officer of Grupo
Televisa
    
    Former Vice
President of
Financial Planning
of Grupo Televisa,
Chief Executive
Officer and Chief
Financial Officer
of Comercio MAS,
S.A. de C.V. and
former Vice
Chairman of Banking
Supervision of the
National Banking
and Securities
Commission
    
    January 2004
 - 99 -




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##### Table of Contents



Name and Date of Birth
    
    Current Position
    
    Business Experience
    
    First AppointedBernardo Gómez Martínez
(07/24/67)
    
    Executive Vice
President and
Member of the
Executive Office of
the Chairman and
Member of the
Executive Committee
of Grupo Televisa
    
    Former Deputy to
the President of
Grupo Televisa,
member of the Board
and of the
Executive Committee
of Televisa and
former President of
the Mexican Chamber
of Television and
Radio Broadcasters
    
    January 2004Eduardo Michelsen Delgado
(03/03/71)
    
    Chief Executive
Officer of
Editorial Televisa
    
    Former General
Director  Grupo
Semanaand former
Project Director 
McKinsey & Co.
    
    January 2002Jorge Eduardo Murguía
Orozco (01/25/50)
    
    Vice President of
Production of Grupo
Televisa
    
    Former
Administrative Vice
President and
former Director of
Human Resources of
Televisa
    
    March 1992Alejandro Quintero
Iñiguez (02/11/50)
    
    Corporate Vice
President of Sales
and Marketing of
Grupo Televisa
    
    Member of the Board
and of the
Executive Committee
of Grupo Televisa,
Shareholder and
Member of the Board
of Grupo TV Promo,
S.A. de C.V. and
former advisor to
former Mexican
President Ernesto
Zedillo
    
    April 1998Raúl Rodríguez González
(06/20/59)
    
    Chief Executive
Officer Sistema
Radiópolis
    
    Former Media
Advisor of Grupo
Prisa and former
Chief Executive
Officer of Gerencia
de Medios, S.A.
    
    January 2002Alexandre Moreira Penna
Da Silva (12/25/54)
    
    Chief Executive
Officer of Innova
    
    Former Vice
President of
Corporate Finance
of Grupo Televisa
and former Managing
Director of
JPMorgan Chase
    
    January 2004
 Compensation of Directors and Officers
   Use of Certain Assets and Services
    Stock Purchase Plan
  - 100 -




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Long-Term Retention Plan
  - 101 -




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##### Table of Contents



Share Ownership of Directors and Officers
  Statutory Auditors
 (comisario)
 Employees and Labor Relations
  Year Ended December 31,2003
    
    2004
    
    2005Total number of employees
    
    
    12,284
    
    
    
    14,140
    
    
    
    15,076Category of activity:Employees
    
    
    12,248
    
    
    
    14,104
    
    
    
    15,042Executives
    
    
    36
    
    
    
    36
    
    
    
    34Geographic location:Mexico
    
    
    10,912
    
    
    
    12,769
    
    
    
    13,680Latin America (other than Mexico)
    
    
    1,020
    
    
    
    965
    
    
    
    954U.S
    
    
    342
    
    
    
    398
    
    
    
    435Spain
    
    
    10
    
    
    
    8
    
    
    
    7
 - 102 -




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##### Table of Contents



Item 7. Major Shareholders and Related Party Transactions
 
 The Principal Shareholders and Related Party Transactions
  AggregatePercentage ofShare Beneficially Owned(1)(2)
    
    OutstandingA Shares
    
    B Shares
    
    D Shares
    
    L Shares
    
    SharesPercentage
    
    
    
    
    
    Percentage
    
    
    
    
    
    Percentage
    
    
    
    
    
    Percentage
    
    BeneficiallyIdentity of Owner
    
    Number
    
    of Class
    
    Number
    
    of Class
    
    Number
    
    of Class
    
    Number
    
    of Class
    
    OwnedAzcárraga Trust(3)
    
    
    52,991,825,693
    
    
    
    42.90
    %
    
    
    67,814,604
    
    
    
    0.11
    %
    
    
    107,886,870
    
    
    
    0.12
    %
    
    
    107,886,870
    
    
    
    0.12
    %
    
    
    14.65
    %Inbursa Trust(3)
    
    
    1,657,549,900
    
    
    
    1.34
    %
    
    
    1,458,643,912
    
    
    
    2.46
    %
    
    
    2,320,569,860
    
    
    
    2.57
    %
    
    
    2,320,569,860
    
    
    
    2.57
    %
    
    
    2.13
    %Investor Trust(3)
    
    
    
    
    
    
    0.00
    %
    
    
    
    
    
    
    0.00
    %
    
    
    
    
    
    
    0.00
    %
    
    
    
    
    
    
    0.00
    %
    
    
    0.00
    %Morgan Stanley Investment
Management Inc.(4)
    
    
    3,435,215,250
    
    
    
    2.8
    %
    
    
    3,022,989,420
    
    
    
    5.1
    %
    
    
    4,809,301,350
    
    
    
    5.3
    %
    
    
    4,809,301,350
    
    
    
    5.3
    %
    
    
    4.4
    %MFS Investment Management(5)
    
    
    3,266,224,500
    
    
    
    2.6
    %
    
    
    2,874,277,560
    
    
    
    4.9
    %
    
    
    4,572,714,300
    
    
    
    5.1
    %
    
    
    4,572,714,300
    
    
    
    5.1
    %
    
    
    4.2
    %
 
 (1)
    
    Unless otherwise indicated, the information presented in this section is based on the
number of shares authorized, issued and outstanding as of May 31, 2006. The number of shares
issued and outstanding for legal purposes as of May 31, 2006 was 64,551,410,550 series A
Shares, 56,805,241,284 series B Shares, 90,371,974,770 series D Shares and 90,371,974,770
series L Shares, in the form of CPOs, and an additional 58,926,613,375 series A Shares,
2,357,207,692 series B Shares, 238,595 series D Shares and 238,595 series L Shares not in the
form of CPOs. For financial reporting purposes under Mexican GAAP only, the number of shares
authorized, issued and outstanding as of May 31, 2006 was 61,683,238,475 series A Shares,
54,281,249,858 series B Shares, 86,356,533,865 series D Shares and 86,356,533,865 series L
Shares in the form of CPOs, and an additional 52,915,848,965 series A Shares, 186,537 series B
Shares, 238,541 series D Shares and 238,541 series L Shares not in the form of CPOs. The
number of shares authorized, issued and outstanding for financial reporting purposes under
Mexican GAAP as of May 31, 2006 does not include: (i) 38,558,047 CPOs and an additional
516,887,975 series A Shares, 20,675,534 series B Shares, 25 series D Shares and 25 series L
Shares not in the form of CPOs acquired by one of our subsidiaries, Televisa, S.A. de C.V.,
substantially all of which are currently held by the trust created to implement our stock
purchase plan; and (ii) 76,168,836 CPOs and an additional 5,493,876,435 series A Shares,
2,336,345,621 series B Shares, 29 series D Shares and 29 series L Shares not in the form of
CPOs acquired by the trust we created to implement our long-term retention plan. See Notes 2
and 12 to our year-end financial statements.(2)
    
    Except indirectly through the Shareholder Trust, none of our directors and executive officers
currently beneficially owns more than 1% of our outstanding A Shares, L Shares or D Shares.
See Directors, Senior Management and Employees  Share Ownership of Directors and Officers.
This information is based on information provided by directors and executive officers.(3)
    
    For a description of the Shareholder Trust, see  The Major Shareholders below.(4)
    
    Based solely on information included in the Report on Form 13F filed on March 31, 2006 by
Morgan Stanley Investment Management, Inc.(5)
    
    Based solely on information included in the Report on Form 13F filed on March 31, 2006 by MFS
Investment Management. - 104 -




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The Major Shareholders
        - 105 -




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Related Party Transactions
 Transactions and Arrangements With Innova.
 Capital Contributions and Loans.
 
    
    News Corp. contributed to Innova an account receivable of U.S.$15 million
owed to News Corp. by Sky DTH, S. de R.L. de C.V., or Sky DTH;
    
    We assigned to Sky DTH an account receivable of U.S.$15 million owed to us
by Innova; and
    
    Innova, Innova Holdings, News Corp., Liberty Media and Sky DTH agreed that
the obligation owed by Innova to Sky DTH and the obligation owed by Sky DTH to Innova
would be set off against each other and cancelled.
  - 106 -




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Programming.
  Advertising Services.
 Guarantees.
  Tax Sharing Agreement.
  - 107 -




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Transactions and Arrangements with MCOP.
 Capital Contributions and Loans.
 Programming.
 Guarantees.
  Transactions and Arrangements with TechCo.
 Capital Contributions and Loans.
 Guarantees.
  Transactions and Arrangements With Univision.
  - 108 -




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Transactions and Arrangements With Our Directors and Officers
    Transactions and Arrangements With Affiliates and Related Parties of Our Directors, Officers and
Major Shareholders
 Production
Services telenovela telenovela telenovela
 Acquisition of Telespecialidades.
 Consulting Services.
 Loans from Banamex.
 - 109 -




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Advertising Services.
  Agency Services.
 Legal and Advisory Services.
 - 110 -




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- 111 -




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Item 8. Financial Information
  
 Item 9. The Offer and Listing
 
 Trading History of CPOs and GDSs
   Nominal Pesos per CPO(1)High
    
    
    Low2001
    
    Ps.
    25.90
    
    
    Ps.
    12.632002
    
    Ps.
    22.31
    
    
    Ps.
    12.442003
    
    Ps.
    23.56
    
    
    Ps.
    12.63First Quarter
    
    
    15.64
    
    
    
    12.63Second Quarter
    
    
    18.71
    
    
    
    13.75Third Quarter
    
    
    21.71
    
    
    
    17.53Fourth Quarter
    
    
    23.56
    
    
    
    19.80December
    
    
    23.41
    
    
    
    21.182004
    
    Ps.
    34.93
    
    
    Ps.
    22.22First Quarter
    
    
    26.35
    
    
    
    22.22Second Quarter
    
    
    26.74
    
    
    
    22.73Third Quarter
    
    
    30.15
    
    
    
    24.82Fourth Quarter
    
    
    34.93
    
    
    
    30.24December
    
    
    34.86
    
    
    
    32.712005
    
    Ps.
    44.13
    
    
    Ps.
    29.20First Quarter
    
    
    36.27
    
    
    
    31.67Second Quarter
    
    
    34.27
    
    
    
    29.20Third Quarter
    
    
    39.23
    
    
    
    33.40Fourth Quarter
    
    
    44.13
    
    
    
    36.51December
    
    
    44.13
    
    
    
    41.672006
(through June 27, 2006)
    
    Ps.
    49.72
    
    
    Ps.
    37.67First Quarter
    
    
    44.96
    
    
    
    40.49January
    
    
    44.96
    
    
    
    42.30February
    
    
    44.24
    
    
    
    41.32March
    
    
    43.48
    
    
    
    40.49Second
Quarter (through June 27, 2006)
    
    
    49.72
    
    
    
    37.67April
    
    
    48.37
    
    
    
    43.16May
    
    
    49.72
    
    
    
    43.12June
(through June 27, 2006)
    
    
    43.49
    
    
    
    37.67
 
 (1)
    
    Source: Mexican Stock Exchange. - 112 -




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##### Table of Contents



U.S.
Dollars per GDS(1)High
    
    Low2001
    
    U.S.$
    13.375
    
    
    U.S.$
    6.70752002
    
    U.S.$
    12.1625
    
    
    U.S.$
    6.0752003
    
    U.S.$
    10.5675
    
    
    U.S.$
    5.815First Quarter
    
    
    7.4875
    
    
    
    5.815Second Quarter
    
    
    8.8625
    
    
    
    6.4025Third Quarter
    
    
    9.9625
    
    
    
    8.3875Fourth Quarter
    
    
    10.5675
    
    
    
    8.7975December
    
    
    10.3
    
    
    
    9.42004
    
    U.S.$
    15.6625
    
    
    U.S.$
    9.8075First Quarter
    
    
    11.835
    
    
    
    10.02Second Quarter
    
    
    11.915
    
    
    
    9.8075Third Quarter
    
    
    13.225
    
    
    
    10.8975Fourth Quarter
    
    
    15.6625
    
    
    
    13.31December
    
    
    15.6625
    
    
    
    14.38252005
    
    U.S.$
    20.775
    
    
    U.S.$
    13.1875First Quarter
    
    
    16.39
    
    
    
    14.125Second Quarter
    
    
    15.2375
    
    
    
    13.1875Third Quarter
    
    
    18.165
    
    
    
    15.5825Fourth Quarter
    
    
    20.775
    
    
    
    16.7025December
    
    
    20.775
    
    
    
    19.9352006
(through June 27, 2006)
    
    US$
    22.87
    
    
    US$
    16.38First Quarter
    
    
    21.3475
    
    
    
    18.77January
    
    
    21.3475
    
    
    
    20.0275February
    
    
    21.085
    
    
    
    19.615March
    
    
    19.90
    
    
    
    18.77Second
Quarter (through June 27, 2006)
    
    
    22.87
    
    
    
    16.38April
    
    
    21.86
    
    
    
    19.86May
    
    
    22.87
    
    
    
    19.07June
(through June 27, 2006)
    
    
    19.36
    
    
    
    16.38
 
 (1)
    
    Source: NYSE.  - 113 -




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##### Table of Contents



Trading on the Mexican Stock Exchange
 Overview
 sociedad anónima capital variable
   Market Regulation and Registration Standards
 Comisión Nacional de Valores Comisión Nacional Bancaria sociedades anónimas de capital variable
 3⁄4 3⁄4 3⁄4 3⁄4 3⁄4
  - 114 -




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##### Table of Contents



circulares
  
    
    a minimum number of years of operating history;
    
    a minimum financial condition;
    
    a minimum number of shares or CPOs to be publicly offered to public investors;
    
    a minimum price for the securities to be offered;
    
    a minimum of 15% of the capital stock placed among public investors;
    
    a minimum of 200 holders of shares or of shares represented by CPOs, who
are deemed to be public investors under the General CNBV Rules, upon the completion of
the offering;
    
    the following distribution of the securities offered pursuant to an
offering in Mexico: (i) at least 50% of the total number of securities offered must be
placed among investors who acquire less than 5% of the total number of securities
offered; and (ii) no investor may acquire more than 40% of the total number of
securities offered; and
    
    complied with certain corporate governance requirements.
  
    
    a minimum financial condition;
    
    minimum operating conditions, including a minimum number of trades;
    
    a minimum trading price of its securities;
    
    a minimum of 12% of the capital stock held by public investors;
    
    a minimum of 100 holders of shares or of shares represented by CPOs who are
deemed to be public investors under the General CNBV Rules; and
    
    complied with certain corporate governance requirements.
   - 115 -




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Sistema Electrónico de Envío y Difusión de Información Sistema Electrónico de Comunicación con Emisores
de Valores Sistema de Información
Financiera Computarizada
  
    
    the entering into or termination of joint venture agreements or agreements with key suppliers;
    
    the creation of new lines of businesses or services;
    
    significant deviations in expected or projected operating performance;
    
    the restructuring or payment of significant indebtedness;
    
    material litigation or labor conflicts;
    
    changes in dividend policy;
    
    the commencement of any insolvency, suspension or bankruptcy proceedings;
    
    changes in the directors; and
    
    any other event that may have a material adverse effect on the results,
financial condition or operations of the relevant issuer.
   
    
    if the issuer does not adequately disclose a material event; or
    
    upon price or volume volatility or changes in the offer or demand in
respect of the relevant securities, which are not consistent with the historic
performance of the securities and could not be explained solely by the information made
publicly available under the General CNBV Rules.
 - 116 -




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- 117 -




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Item 10. Additional Information
 
 Mexican Securities Market Law
  
    
    established a Board with at least five and not more than 20 members and
alternate members, of which 25% must qualify as independent directors under Mexican
law;
    
    adopted specified corporate governance measures, which require us to
establish, among other things, an audit committee, as well as more stringent procedures
for the approval of transactions and arrangements with related parties and
extraordinary corporate transactions; and
    
    provide additional protections for minority shareholders.
     - 118 -




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##### Table of Contents




    
    members of a listed issuers board of directors,
    
    shareholders controlling 10% or more of a listed issuers outstanding share capital,
    
    advisors,
    
    groups controlling 25% or more of a listed issuers outstanding share capital and
    
    other insiders
    - 119 -




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##### Table of Contents



Bylaws
  Organization and Register
 sociedad anónima folio mercantil
  Voting Rights and Shareholders Meetings
 Holders of A Shares
 Holders of B Shares
 Holders of D Shares and L Shares
 
    
    our transformation from one type of company to another;
    
    any merger (even if we are the surviving entity);
    
    extension of our existence beyond our prescribed duration;
 - 120 -




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
    
    our dissolution before our prescribed duration (which is currently December 2089);
    
    a change in our corporate purpose;
    
    a change in our nationality; and
    
    the cancellation from registration of the D Shares or the securities which
represent the D Shares with the securities or special section of the National Registry
of Securities, or NRS, and with any other Mexican or foreign stock exchange in which
such shares or securities are registered.
  
    
    our transformation from one type of company to another;
    
    any merger in which we are not the surviving entity; and
    
    the cancellation from registration of the L Shares or the securities that
represent the L Shares with the special section of the NRS.
  Other Rights of Shareholders
  - 121 -




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Holders of CPOs
  Holders of GDRs
   - 122 -




---



##### Table of Contents




  Dividend Rights
  Preferential Rights of D Shares
  
    
    first, to the payment of dividends with respect to the A Shares, the B
Shares and the L Shares, in an equal amount per share, up to the amount of the D Share
fixed preferred dividend; and
    
    second, to the payment of dividends with respect to the A Shares, B Shares,
D Shares and L Shares, such that the dividend per share is equal.
  
    
    accrued but unpaid dividends in respect of their D Shares; plus
 - 123 -




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
    
    the theoretical value of their D Shares as set forth in our bylaws. See
Other Provisions  Dissolution or Liquidation.
 Limitation on Capital Increases
  Preemptive Rights
 Diario Oficial de la Federación
  Limitations on Share Ownership
  - 124 -




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##### Table of Contents



Other Provisions
 Forfeiture of Shares
 
    
    to be considered as Mexicans with respect to the L Shares and CPOs that
they acquire or hold, as well as to the property, rights, concessions, participations
or interests owned by us or to the rights and obligations derived from any agreements
we have with the Mexican government; and
    
    not to invoke the protection of their own governments with respect to their
ownership of L Shares and CPOs.
  Exclusive Jurisdiction
 Duration
 - 125 -




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##### Table of Contents



Dissolution or Liquidation
 Redemption
 
    
    any redemption shall be made on a pro-rata basis among all of our
shareholders;
    
    to the extent that a redemption is effected through a public tender offer
on the Mexican Stock Exchange, the shareholders resolution approving the redemption
may empower our Board to specify the number of shares to be redeemed and appoint the
related intermediary or purchase agent; and
    
    any redeemed shares must be cancelled.
 Share Repurchases
 Conflicts of Interest
 Appraisal Rights and Other Minority Protections
 - 126 -




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##### Table of Contents




    
    holders of at least 10% of our outstanding capital stock to call a
shareholders meeting in which they are entitled to vote;
    
    subject to the satisfaction of certain requirements under Mexican law,
holders of at least 15% of our outstanding capital stock to bring an action for civil
liabilities against our directors;
    
    holders of at least 10% of our Shares that are entitled to vote and are
represented at a shareholders meeting to request postponement of resolutions with
respect to any matter on which they were not sufficiently informed; and
    
    subject to the satisfaction of certain requirements under Mexican law,
holders of at least 20% of our outstanding capital stock to contest and suspend any
shareholder resolution.
  Antitakeover Protections
 General
 - 127 -




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##### Table of Contents



Board Notices, Meetings, Quorum Requirements and Approvals
  Shareholder Notices, Meetings, Quorum Requirements and Approvals
 - 128 -




---



##### Table of Contents



Mandatory Tender Offers in the Case of Certain Acquisitions
 Exceptions
 Amendments to the Antitakeover Provisions
 - 129 -




---



##### Table of Contents



Enforceability of Civil Liabilities
  
 Material Contracts
     - 130 -




---



##### Table of Contents



Legal Proceedings
 Secretaría de Hacienda y Crédito Público
  La Lupa,
 El Chavo
del 8, El Chapulin Colorado Chespirito
 - 131 -




---



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Premio Lo Nuestro Premio Lo Nuestro
    - 132 -




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New York Stock Exchange Corporate Governance Standards
  Bolsa Mexicana de
Valores Código de Mejores Prácticas Corporativas
  NYSE rules
    
    Mexican rulesListed companies must have a
majority of independent directors
    
    The Mexican Securities Market Law
requires that listed companies have
at least 25% of independent
directors. Our board of directors
is not required to make a
determination as to the independence
of the directors. The definition of
independence under the Mexican
Securities Market Law differs in
some aspects from the one applicable
to U.S. issuers under the NYSE
standard and prohibits, among other
relationships, an independent
director from being an employee or
officer of the company or a
shareholder that may have influence
over our officers, as well as
certain relationships between the
company and the independent
director, entities in which the
independent director is a partner,
director or employee and family
members of the independent director.
In addition, our bylaws broaden the
definition of independent director.
Our bylaws provide for an executive
committee of our board of directors.
The executive committee is currently
composed of eight members, and there
are no Mexican rules applicable that
require any of the members to be
independent. The executive committee
may generally exercise the powers of
our board of directors, subject to
certain exceptions. Our Chief
Executive Officer is a member of our
board of directors and the executive
committee.Listed companies must have a
nominating/corporate governance
committee composed entirely of
independent directors.
    
    Listed companies are not required to
have a nominating/corporate
governance committee.
 - 133 -




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NYSE rules
    
    Mexican rulesListed companies must have a
compensation committee composed
entirely of independent directors.
    
    The Mexican Code of Best Corporate
Practices recommends listed
companies to have a compensation
committee. While these rules are not
legally binding, companies failing
to comply with the Codes
recommendation must disclose
publicly why their practices differ
from those recommended by the Code.Listed companies must have an audit
committee with a minimum of three
members and must be independent.
    
    The Mexican Securities Market Law
requires that listed companies must
have an audit committee. The
Chairman and the majority of the
members must be independent.Non-management directors must meet
at executive sessions without
management.
    
    Our non-management directors are not
required to meet at executive
sessions. The Mexican Code of Best
Corporate Practices does not
expressly recommend executive
sessions.Listed companies must adopt and
disclose a code of business conduct
and ethics for directors, officers
and employees, and promptly discuss
any waivers of the code for
directors or executive officers.
    
    Companies listed on the Mexican
Stock Exchange are not required to
adopt a code of ethics. However,
we have recently adopted a code of
ethics which is available free of
charge through our offices. See
Item 16B Code of Ethics for
directions on how to obtain a copy
of our code of ethics. Waivers
involving any of our executive
officers or directors will be made
only by our Board of Directors or a
designated committee of the Board.
 
 Exchange Controls
  
 Taxation
 U.S. Taxes
 General.
 
    
    that owns, directly, indirectly or through attribution, 2% or more of
the total voting power or value of our outstanding Underlying Shares (including
through ownership of GDSs);
    
    that is a dealer in securities, insurance company, financial
institution, tax-exempt organization, U.S. expatriate, broker-dealer or trader in
securities; or
    
    whose functional currency is not the U.S. Dollar.
 - 134 -




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##### Table of Contents




    
    the tax consequences to the shareholders, partners or beneficiaries of a U.S. Holder; or
    
    special tax rules that may apply to a U.S. Holder that holds GDSs, CPOs
or Underlying Shares as part of a straddle, hedge, conversion transaction,
synthetic security or other integrated investment.
   
    
    the U.S. Internal Revenue Code of 1986, as amended, applicable U.S.
Treasury regulations and judicial and administrative interpretations, and
    
    the convention between the Government of the United States of America
and the Government of the United Mexican States for the Avoidance of Double
Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income,
including the applicable protocols, collectively referred to herein as the tax
treaty,
 and is subject to changes to those laws and the tax treaty subsequent to the date of this annual
report, which changes could be made on a retroactive basis; and
 
    
    is also based, in part, on the representations of the depositary with
respect to the GDSs and on the assumption that each obligation in the deposit
agreement relating to the GDSs and any related agreements will be performed in
accordance with their terms.
  
    
    a citizen or individual resident of the United States;
    
    a corporation (or entity treated as a corporation for such purposes)
created or organized in or under the laws of the United States, or any State
thereof or the District of Columbia;
    
    an estate the income of which is included in gross income for U.S.
federal income tax purposes regardless of source; or
    
    a trust, if either (x) it is subject to the primary supervision of a
court within the United States and one or more United States persons has the
authority to control all substantial decisions of the trust or (y) it has a valid
election in effect under applicable U.S. Treasury regulations to be treated as a
United States person.
   - 135 -




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
    
    is not a resident of Mexico for purposes of the tax treaty;
    
    is an individual who has a substantial presence in the United States;
    
    is entitled to the benefits of the tax treaty under the limitation on
benefits provision contained in Article 17 of the tax treaty; and
    
    does not have a fixed place of business or a permanent establishment in
Mexico with which its ownership of CPOs, GDSs or Underlying Shares is effectively
connected.
  Dividends.
   - 136 -




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##### Table of Contents



Capital Gains.
    
    
    the gain is effectively connected with the beneficial ownerss conduct
of a trade or business in the United States; or
    
    the beneficial owner is an individual who holds CPOs, GDSs or
Underlying Shares as a capital asset, is present in the United States for 183 days
or more in the taxable year of the sale or exchange and meets other requirements.
 U.S. Backup Withholding.
 
    
    is a corporation or comes within an exempt category; or
    
    provides a taxpayer identification number, certifies as to no loss of
exemption from backup withholding tax and otherwise complies with the applicable
requirements of the backup withholding rules.
  - 137 -




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Mexican Taxes
 General.
   
    
    the Mexican Income Tax Law, the Mexican Federal Tax Code and their respective regulations,
    
    rules issued by the Mexican tax authorities, and
    
    the tax treaty.
   
    
    an individual is a Mexican tax resident if the individual has
established his home in Mexico. When an individual, in addition to his home in
Mexico, has a home in another country, the individual will be a Mexican tax
resident if his center of vital interests is located in Mexico. This will be deemed
to occur if, among other circumstances, either (i) more than 50% of the total
income obtained by the individual in the calendar year is Mexican source; or (ii)
when the individuals center of professional activities is located in Mexico.
Unless otherwise proven, a Mexican national is considered a Mexican tax resident.
    
    a legal entity is considered a Mexico tax resident if it is
incorporated under Mexican law or if it maintains the main administration of its
head office or business or the effective location of its management in Mexico; and
    
    a foreign person with a permanent establishment in Mexico will be
required to pay taxes in Mexico in accordance with the Mexican Income Tax Law for
income attributable to such permanent establishment.
 Dividends.
 cuenta de
utilidad fiscal neta
 Sales or Other Dispositions.
 - 138 -




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##### Table of Contents



Other Mexican Taxes.
 
 Documents on Display
    - 139 -




---



##### Table of Contents



Item 11. Quantitative and Qualitative Disclosures About Market Risk
 Market Risk Disclosures
  Risk Management
    Foreign Currency, Exchange Rate Risk
    - 140 -




---



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Interest Rate Risk
    Inflation Rate Risk
  Common Stock Price Risk
   - 141 -




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Sensitivity and Fair Value Analyses.
  Fair Value at December 31,2004
    
    2005
    
    2005(Millions of Pesos in purchasing power as ofDecember 31, 2005 or millions of U.S. Dollars)(1)Assets:Temporary investments(2)
    
    Ps.
    16,792.4
    
    
    Ps.
    14,233.4
    
    
    U.S.$
    1,339.4Liabilities:U.S. Dollar-denominated debt:Long-term debt securities(3)
    
    
    68.2
    
    
    
    58.1
    
    
    
    5.5Senior Notes due 2005
    
    
    2,375.1
    
    
    
    
    
    
    
    Senior Notes due 2011(4)
    
    
    4,003.6
    
    
    
    896.0
    
    
    
    84.3Senior Notes due 2032(5)
    
    
    3,983.2
    
    
    
    3,806.4
    
    
    
    358.2Innovas Senior Notes due 2007
    
    
    1,014.4
    
    
    
    
    
    
    
    Innovas Senior Notes due 2013(6)
    
    
    3,942.6
    
    
    
    3,519.5
    
    
    
    331.2Senior Notes due 2025(8)
    
    
    
    
    
    
    6,578.1
    
    
    
    619.0Peso-denominated debt:UDI-denominated long-term loan facility(9)
    
    
    4,298.3
    
    
    
    1,002.8
    
    
    
    94.4Long-term notes payable to Mexican Banks(7)
    
    
    5,199.6
    
    
    
    3,964.1
    
    
    
    373.0
 
 (1)
    
    Peso amounts have been converted to U.S. Dollars solely for the convenience of the reader
at a nominal exchange rate of Ps.10.6265 per U.S. Dollar, the Interbank Rate as of December
31, 2005.(2)
    
    At December 31, 2005, our temporary investments consisted of fixed rate short-term deposits
in commercial banks (primarily Peso- and U.S. Dollar-denominated in 2004 and 2005). Given the
short-term nature of these investments, an increase in U.S. and/or Mexican interest rates
would not significantly decrease the fair value of these investments.(3)
    
    At December 31, 2005, fair value exceeded the carrying value of those debt securities by
approximately Ps.1.4 million (U.S.$0.1 million). The increase in the fair value of a
hypothetical 10% increase in the estimated market price of those debt securities would amount
to Ps.7.2 million (U.S.$0.7 million) at December 31, 2005.(4)
    
    At December 31, 2005, fair value exceeded the carrying value of these notes by approximately
Ps.93.9 million (U.S.$8.8 million). The increase in the fair value of these notes of a
hypothetical 10% increase in the quoted market price of these notes would amount to
approximately Ps.183.5 million (U.S.$17.3 million) at December 31, 2005.(5)
    
    At December 31, 2005, fair value exceeded the carrying value of these notes by approximately
Ps.618.5 million (U.S.$58.2 million). The increase in the fair value of these notes of a
hypothetical 10% increase in the quoted market price of these notes would amount to
approximately Ps.999.1 million (U.S.$94.0 million) at December 31, 2005.(6)
    
    At December 31, 2005, fair value exceeded the carrying value of these notes by approximately
Ps.331.5 million (U.S.$31.2 million). The increase in the fair value of these notes of a
hypothetical 10% increase in the quoted market price of these notes would amount to
approximately Ps.683.5 million (U.S.$64.3 million) at December 31, 2005.(7)
    
    At December 31, 2005, fair value exceeded the carrying value of these notes by approximately
Ps.81.6 million (U.S.$7.7 million). At December 31, 2005, a hypothetical 10% increase in
Mexican interest rates would increase the fair value of these notes by approximately Ps.478.1
million (U.S.$45.0 million) at December 31, 2005. - 142 -




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##### Table of Contents



(8)
    
    At December 31, 2005, fair value exceeded the carrying value of these notes by approximately
Ps.202.2 million (U.S.$19.0 million). The increase in the fair value of these notes of a
hypothetical 10% increase in the quoted market price of these notes would amount to
approximately Ps.860.1 million (U.S.$80.9 million) at December 31, 2005.(9)
    
    At December 31, 2005, fair value exceeded carrying value of amounts outstanding under this
loan by approximately Ps.61.7 million (U.S.$5.8 million). At December 31, 2005, a hypothetical
10% increase in the Mexican inflation rate to 3.6% for the year 2005 would increase principal
amounts outstanding under this UDI-denominated long-term loan facility by approximately
Ps.162.0 million (U.S.$15.2 million). An inflation rate of less than 4.0% is forecasted by the
Mexican government for 2006. We entered into inflation swap agreements to fix the inflation
rate on this UDI-denominated facility at an annual rate of approximately 4%, however, we
terminated these derivative agreements in March 2005.  Year Ended December 31,2004
    
    
    2005(In millions of U.S. Dollars)U.S. Dollar-denominated short-term investments and long-term notes receivable
    
    U.S.$
    582.6
    
    
    U.S.$
    682.9U.S. Dollar-denominated senior debt securities and other notes payable
    
    
    1,482.5
    
    
    
    1,563.5899.9
    
    
    
    880.6Derivative instruments, net
    
    
    (8.0
    )
    
    
    (8.0
    )Net liability position
    
    U.S.$
    891.9
    
    
    U.S.$
    872.6
  
 Item 12. Description of Securities Other than Equity Securities
  
 Part II
 
 Item 13. Defaults, Dividend Arrearages and Delinquencies
  
 Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds
  
 Item 15. Controls and Procedures
   
 Item 16A. Audit Committee Financial Expert
  - 143 -




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##### Table of Contents



Item 16B. Code of Ethics
   
 
 Item 16C. Principal Accountant Fees and Services
   2004
    
    2005(in millions of Pesos in purchasing poweras of December 31, 2005)Audit Fees
    
    Ps.
    
    38.6
    
    Ps.
    
    39.8Audit-Related Fees
    
    
    
    
    
    
    
    3.5Tax Fees
    
    
    
    5.7
    
    
    
    3.7Other Fees
    
    
    
    
   
    
    
    11.5Total
    
    Ps.
    
    44.3
    
    Ps.
    
    58.5
      - 144 -




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##### Table of Contents



Audit Committee Pre-approval Policies and Procedures
   
 Item 16D. Exemptions from the Listing Standards for Audit Committees
  
 Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers
  Purchases of Equity Securities by Televisa
 Maximum Number (orTotal Number of
    
    Appropriate Mexican PesoCPOs
    
    Value) of CPOsTotal Number
    
    
    
    
    
    Purchased as part of
    
    that May Yet Beof CPOs
    
    Average Price
    
    Publicly Announced
    
    Purchased Under thePurchase Date
    
    Purchased
    
    Paid per CPO(1)
    
    Plans or Programs
    
    Plans or Programs (1)January 1 to January 31
    
    
    1,592,900
    
    
    Ps.
    32.186468
    
    
    
    48,685,600
    
    
    Ps.
    3,021,017,874February 1 to February 29
    
    
    90,400
    
    
    
    34.954558
    
    
    
    48,776,000
    
    
    
    3,017,857,978March 1 to March 31
    
    
    4,231,400
    
    
    
    32.701047
    
    
    
    53,007,400
    
    
    
    2,879,486,737April 1 to April 30
    
    
    5,603,400
    
    
    
    31.552905
    
    
    
    58,610,800
    
    
    
    2,702,683,249May 1 to May 31
    
    
    7,134,900
    
    
    
    31.463152
    
    
    
    65,745,700
    
    
    
    2,478,196,900June 1 to June 30
    
    
    
    
    
    
    
    
    
    
    65,745,700
    
    
    
    2,478,196,900July 1 to July 31
    
    
    821,100
    
    
    
    34.914656
    
    
    
    66,566,800
    
    
    
    2,449,528,440August 1 to August 31
    
    
    8,018,300
    
    
    
    34.484304
    
    
    
    74,585,100
    
    
    
    2,173,022,994September 1 to September 30
    
    
    1,177,000
    
    
    
    34.298937
    
    
    
    75,762,100
    
    
    
    2,132,653,136October 1 to October 31
    
    
    
    
    
    
    
    
    
    
    75,762,100
    
    
    
    2,132,653,136November 1 to November 30
    
    
    868,400
    
    
    
    40.759666
    
    
    
    76,630,500
    
    
    
    2,097,257,468December 1 to December 31
    
    
    1,620,000
    
    
    
    42.356154
    
    
    
    78,250,500
    
    
    
    2,028,640,510Total
    
    
    31,157,800
    
    
    Ps.
    33.495540
    
    
    
    78,250,500
    
    
    Ps.
    2,028,640,510
 
 (1)
    
    The values have not been restated in constant Mexican Pesos and therefore represent
nominal historical figures.(2)
    
    Our share repurchase program was announced in September of 2002 and is set to expire
December 31, 2008. Our share repurchase program is limited to a total amount of U.S.$400
million.(3)
    
    Table does not include repurchases or purchases by the special purpose trust formed in
connection with our stock purchase plan. - 145 -




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Purchases of Equity Securities by Special Purpose Trust
formed in connection with Stock Purchase Plan (1)
 CPOs
 Maximum Number (orAppropriate Mexican PesoValue) of CPOsTotal Number
    
    
    
    
    
    Total Number of CPOs
    
    that May Yet Beof CPOs
    
    Average Price
    
    Purchased as part of
    
    Purchased Under thePurchase Date
    
    Purchased
    
    Paid per CPO (2)
    
    the Stock Purchase Plan
    
    Stock Purchase Plan(3)January 1 to January 31
    
    
    650,000
    
    
    Ps.
    32.945860
    
    
    
    45,728,300February 1 to February 29
    
    
    
    
    
    
    
    
    
    
    45,728,300March 1 to March 31
    
    
    250,000
    
    
    
    32.43858
    
    
    
    45,978,300April 1 to April 30
    
    
    
    
    
    
    
    
    
    
    45,978,300May 1 to May 31
    
    
    1,510,000
    
    
    
    31.65265
    
    
    
    47,488,300June 1 to June 30
    
    
    3,600,000
    
    
    
    32.64060
    
    
    
    51,088,300July 1 to July 31
    
    
    850,000
    
    
    
    34.86641
    
    
    
    51,938,300August 1 to August 31
    
    
    1,290,000
    
    
    
    34.84124
    
    
    
    53,228,300September 1 to September 30
    
    
    350,000
    
    
    
    37.46426
    
    
    
    53,578,300October 1 to October 31
    
    
    240,000
    
    
    
    39.33220
    
    
    
    53,818,300November 1 to November 30
    
    
    335,000
    
    
    
    41.62134
    
    
    
    54,153,300December 1 to December 31
    
    
    1,200,000
    
    
    
    42.41697
    
    
    
    55,353,300Total
    
    
    10,275,000
    
    
    Ps.
    34.72540
    
    
    
    55,353,300
 
 (1)
    
    See Directors, Senior Management and Employees  Stock Purchase Plan for a description
of the implementation, limits and other terms of our Stock Purchase Plan.(2)
    
    The values have not been restated in constant Mexican Pesos and therefore represent
nominal historical figures.(3)
    
    Since the number of additional shares that may be issued pursuant to our Stock Purchase
Plan is affected by, among other things, the number of shares held by the special equity
trust, periodic grants made to certain executives, the performance of those executives and
the number of shares subject to other employee benefit plans, it would be misleading to
imply that there is a defined maximum number of shares that remain to be purchased pursuant
to our Stock Purchase Plan. 
 Part III
 
 Item 17. Financial Statements
  
 Item 18. Financial Statements
  
 Item 19. Exhibits
  - 146 -




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##### Table of Contents



ExhibitNumber
    
    Description of Exhibits1.1
    
    English translation of Amended and
Restated Bylaws (Estatutos
Sociales) of the Registrant, dated
as of April 16, 2004 (previously
filed with the Securities Exchange
Commission as Exhibit 1.1 to the
Registrants Annual Report Form
20-F for the year ended December
31, 2003 and incorporated herein by
reference).2.1
    
    Indenture relating to Senior Debt
Securities, dated as of August 8,
2000, between the Registrant, as
Issuer, and The Bank of New York,
as Trustee (previously filed with
the Securities and Exchange
Commission as Exhibit 4.1 to the
Registrants Registration Statement
on Form F-4 (File number
333-12738), as amended (the 2000
Form F-4), and incorporated herein
by reference).2.2
    
    Third Supplemental Indenture
relating to the 8% Senior Notes due
2011, dated as of September 13,
2001, between the Registrant, as
Issuer, and The Bank of New York
and Banque Internationale à
Luxembourg, S.A. (previously filed
with the Securities and Exchange
Commission as Exhibit 4.4 to the
Registrants Registration Statement
on Form F-4 (File number 333-14200)
(the 2001 Form F-4) and
incorporated herein by reference).2.3
    
    Fourth Supplemental Indenture
relating to the 8.5% Senior
Exchange Notes due 2032 between the
Registrant, as Issuer, and The Bank
of New York and Dexia Banque
Internationale à Luxembourg
(previously filed with the
Securities Exchange Commission as
Exhibit 4.5 to the Registrants
Registration Statement on Form F-4
(the 2002 Form F-4) and
incorporated herein by reference).2.4
    
    Fifth Supplemental Indenture
relating to the 8% Senior Notes due
2011 between Registrant, as Issuer,
and The Bank of New York and Dexia
Banque Internationale à Luxembourg
(previously filed with the
Securities and Exchange Commission
as Exhibit 4.5 to the 2001 Form F-4
and incorporated herein by
reference).
 E-1




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##### Table of Contents



ExhibitNumber
    
    Description of Exhibits2.5
    
    Sixth Supplemental Indenture
relating to the 8.5% Senior Notes
due 2032 between Registrant, as
Issuer, and The Bank of New York
and Dexia Banque Internationale à
Luxembourg (previously filed with
the Securities and Exchange
Commission as Exhibit 4.7 to the
2002 Form F-4 and incorporated
herein by reference).2.6
    
    Seventh Supplemental Indenture
relating to the 6 5/8% Senior Notes
due 2025 between Registrant, as
Issuer, and The Bank of New York
and Dexia Banque Internationale à
Luxembourg, dated March 18, 2005
(previously filed with the
Securities and Exchange Commission
as Exhibit 2.8 to the Registrants
Annual Report on Form 20-F for the
year ended December 31, 2004 (the
2004 Form 20-F) and incorporated
herein by reference).2.7
    
    Eighth Supplemental Indenture
relating to the 6 5/8% Senior Notes
due 2025 between Registrant, as
Issuer, and The Bank of New York
and Dexia Banque Internationale à
Luxembourg, dated May 26, 2005
(previously filed with the
Securities and Exchange Commission
as Exhibit 2.9 to the 2004 Form
20-F and incorporated herein by
reference).2.8
    
    Ninth Supplemental Indenture
relating to the 6 5/8% Senior Notes
due 2025 between Registrant, as
Issuer, The Bank of New York and
Dexia Banque Internationale à
Luxembourg, dated September 6,
2005.2.9
    
    Form of Deposit Agreement between
the Registrant, JPMorgan Chase
Bank, as depositary and all holders
and beneficial owners of the Global
Depositary Shares, evidenced by
Global Depositary Receipts
(previously filed with the
Securities and Exchange Commission
as an Exhibit to the Registrants
Registration Statement on Form F-6
(File number 333-99195) (the Form
F-6) and incorporated herein by
reference).4.1
    
    Form of Indemnity Agreement between
the Registrant and its directors
and executive officers (previously
filed with the Securities and
Exchange Commission as Exhibit 10.1
to the Registrants Registration
Statement on Form F-4 (File number
33-69636), as amended, (the 1993
Form F-4) and incorporated herein
by reference).4.2
    
    Amended and Restated Collateral
Trust Agreement, dated as of June
13, 1997, as amended, among
PanAmSat Corporation, Hughes
Communications, Inc., Satellite
Company, LLC, the Registrant and
IBJ Schroder Bank and Trust Company
(previously filed with the
Securities and Exchange Commission
as an Exhibit to the Registrants
Annual Report on Form 20-F for the
year ended December 31, 2001 (the
2001 Form 20-F) and incorporated
herein by reference).4.3
    
    Amended and Restated Program
License Agreement, dated as of
December 19, 2001, by and between
Productora de Teleprogramas, S.A.
de C.V. and Univision
Communications Inc. (Univision)
(previously filed with the
Securities and Exchange Commission
as Exhibit 10.7 to the 2001 Form
F-4 and incorporated herein by
reference).
 E-2




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ExhibitNumber
    
    Description of Exhibits4.4
    
    Participation Agreement, dated as
of October 2, 1996, by and among
Univision, Perenchio, the
Registrant, Venevision and certain
of their respective affiliates
(previously filed with the
Securities and Exchange Commission
as Exhibit 10.8 to Univisions
Registration Statement on Form S-1
(File number 333-6309) (the
Univision Form S-1) and
incorporated herein by reference).4.5
    
    Amended and Restated International
Program Rights Agreement, dated as
of December 19, 2001, by and among
Univision, Venevision and the
Registrant (previously filed with
the Securities and Exchange
Commission as Exhibit 10.9 to the
2001 Form F-4 and incorporated
herein by reference).4.6
    
    Co-Production Agreement, dated as
of March 27, 1998, between the
Registrant and Univision Network
Limited Partnership (previously
filed with the Securities and
Exchange Commission as an Exhibit
to Univisions Annual Report on
Form 10-K for the year ended
December 31, 1997 and incorporated
herein by reference).4.7
    
    Program License Agreement, dated as
of May 31, 2005, between Registrant
and Univision.4.8
    
    Amended and Restated Bylaws
(Estatutos Sociales) of Innova, S.
de R.L. de C.V. (Innova) dated as
of December 22, 1998 (previously
filed with the Securities and
Exchange Commission as an Exhibit
to Innovas Annual Report on Form
20-F for the year ended December
31, 2004 and incorporated herein by
reference).4.9
    
    English translation of investment
agreement, dated as of March 26, 2006, between Registrant
and M/A and Gestora de Inversiones Audiovisuales La Sexta, S.A.4.10
    
    English summary of Ps.1,162.5
million credit agreement, dated as
of May 17, 2004, between the
Registrant and Banamex (the May
2004 Credit Agreement) and the May
2004 Credit Agreement (in Spanish)
(previously filed with the
Securities and Exchange Commission
as Exhibit 4.9 to the 2004 Form
20-F and incorporated herein by
reference).4.11
    
    English summary of amendment to the
May Credit Agreement and the
amendment to the May 2004 Credit
Agreement (in Spanish) (previously
filed with the Securities and
Exchange Commission as Exhibit 4.10
to the 2004 Form 20-F and
incorporated herein by reference).4.12
    
    English summary of Ps.2,000.0
million credit agreement, dated as
of October 22, 2004, between the
Registrant and Banamex (the
October 2004 Credit Agreement)
and the October Credit Agreement
(in Spanish) (previously filed with
the Securities and Exchange
Commission as Exhibit 4.11 to the
2004 Form 20-F and incorporated
herein by reference).4.13
    
    English translation of Ps.2,100.0
million credit agreement, dated as
of March 10, 2006, by and among
Innova, the Registrant and Banamex.4.14
    
    English summary of Ps.1,400.0
million credit agreement, dated as
of April 7, 2006, by and among
Innova, the Registrant and Banco
Santander Serfin, S.A. (the April
 E-3




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##### Table of Contents



ExhibitNumber
    
    Description of Exhibits2006 Credit Agreement) and the
April Credit Agreement (in
Spanish).4.15
    
    Administration Trust Agreement
relating to Trust No. 80375, dated
as of March 23, 2004, by and among
Nacional Financiera, S.N.C., as
trustee of Trust No. 80370, Banco
Inbursa, S.A., as trustee of Trust
No. F/0553, Banco Nacional de
México, S.A., as trustee of Trust
No. 14520-1, Nacional Financiera,
S.N.C., as trustee of Trust No.
80375, Emilio Azcárraga Jean,
Promotora Inbursa, S.A. de C.V.,
María Asunción Aramburuzabala
Larregui, Lucrecia Aramburuzabala
Larregui de Fernández, María de las
Nieves Fernández González, Antonino
Fernández Rodríguez, Carlos
Fernández González, Grupo Televisa,
S.A. and Grupo Televicentro, S.A.
de C.V. (as previously filed with
the Securities and Exchange
Commission as an Exhibit to
Schedules 13D or 13D/A in respect
of various parties to the Trust
Agreement (File number 005-60431)
and incorporated herein by
reference).8.1
    
    List of Subsidiaries of Registrant.12.1
    
    CEO Certification pursuant to
Section 302 of the Sarbanes-Oxley
Act of 2002, dated June 30, 2006.12.2
    
    CFO Certification pursuant to
Section 302 of the Sarbanes-Oxley
Act of 2002, dated June 30, 2006.13.1
    
    CEO Certification pursuant to
Section 906 of the Sarbanes-Oxley
Act of 2002, dated June 30, 2006.13.2
    
    CFO Certification pursuant to
Section 906 of the Sarbanes-Oxley
Act of 2002, dated June 30, 2006.
   E-4




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SIGNATURE
  Date June 30, 2006
    
    GRUPO TELEVISA, S.A.By:
    
    /s/ Salvi Folch ViaderoName:
    
    Salvi Folch ViaderoTitle:
    
    Chief Financial OfficerBy:
    
    /s/ Joaquín Balcárcel Santa CruzName:
    
    Joaquín Balcárcel Santa CruzTitle:
    
    Vice President — Legal and General Counsel




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##### Table of Contents



INDEX TO CONSOLIDATED FINANCIAL STATEMENTS OF
 GRUPO TELEVISA, S.A. AND SUBSIDIARES
 PageReport of Independent Registered Public Accounting Firm
    
    
    F-2Report of Independent Registered Public Accounting Firm of Univision Communications Inc.
    
    
    F-3Consolidated Balance Sheets as of December 31, 2004 and 2005
    
    
    F-4Consolidated Statements of Income for the Years Ended December 31, 2003, 2004 and 2005
    
    
    F-6Consolidated Statements of Changes in Stockholders Equity for the Years Ended December 31,
2003, 2004 and 2005
    
    
    F-7Consolidated Statements of Changes in Financial Position for the Years Ended December 31,
2003, 2004 and 2005
    
    
    F-8Notes to Consolidated Financial Statements for the Years Ended December 31, 2003,
2004 and 2005
    
    
    F-9
 F-1




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
         PricewaterhouseCoopers, S.C.
 é é
 F-2




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##### Table of Contents



FINANCIAL STATEMENT OPINON
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
      
 F-3




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##### Table of Contents



GRUPO TELEVISA, S.A.
 
 CONSOLIDATED BALANCE SHEETS
 As of December 31, 2004 and 2005
 (In thousands of Mexican pesos in purchasing power as of December 31, 2005)
 (Notes 1 and 2)
 2004
    
    
    2005ASSETSCurrent:Available:Cash
    
    
    
    
    
    Ps.
    403,540
    
    
    Ps.
    544,582Temporary investments
    
    
    
    
    
    
    16,792,407
    
    
    
    14,233,37217,195,947
    
    
    
    14,777,954Trade notes and accounts receivable, net
    
    (Note 3)
    
    
    11,604,240
    
    
    
    13,896,300Other accounts and notes receivable, net
    
    
    
    
    
    
    1,210,593
    
    
    
    570,610Due from affiliated companies, net
    
    (Note 16)
    
    
    78,961
    
    
    
    Transmission rights and programming
    
    (Note 4)
    
    
    3,713,684
    
    
    
    3,120,501Inventories
    
    
    
    
    
    
    684,848
    
    
    
    638,280Other current assets
    
    
    
    
    
    
    734,650
    
    
    
    578,068Total current assets
    
    
    
    
    
    
    35,222,923
    
    
    
    33,581,713Transmission rights and programming, noncurrent
    
    (Note 4)
    
    
    4,641,403
    
    
    
    3,920,967Investments
    
    (Note 5)
    
    
    6,982,937
    
    
    
    7,587,509Property, plant and equipment, net
    
    (Note 6)
    
    
    19,798,098
    
    
    
    19,728,547Intangible assets and deferred charges, net
    
    (Note 7)
    
    
    9,461,758
    
    
    
    10,013,273Other assets
    
    
    
    
    
    
    277,532
    
    
    
    19,728Total assets
    
    
    
    
    
    Ps.
    76,384,651
    
    
    Ps.
    74,851,737
  F-4




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##### Table of Contents



GRUPO TELEVISA, S.A.
 CONSOLIDATED BALANCE SHEETS
As of December 31, 2004 and 2005
(In thousands of Mexican pesos in purchasing power as of December 31, 2005)
(Notes 1 and 2)
 2004
    
    
    2005LIABILITIESCurrent:Current portion of long-term debt
    
    (Note 8)
    
    Ps.
    3,406,973
    
    
    Ps.
    340,457Current portion of satellite transponder lease obligation
    
    (Note 8)
    
    
    73,101
    
    
    
    75,604Trade accounts payable
    
    
    
    
    
    
    2,206,412
    
    
    
    2,954,723Customer deposits and advances
    
    
    
    
    
    
    15,427,906
    
    
    
    15,538,229Taxes payable
    
    
    
    
    
    
    1,610,711
    
    
    
    1,055,793Accrued interest
    
    
    
    
    
    
    464,352
    
    
    
    334,609Other accrued liabilities
    
    
    
    
    
    
    1,313,105
    
    
    
    1,580,931Due to affiliated companies, net
    
    (Note 16)
    
    
    
    
    
    
    455,903Total current liabilities
    
    
    
    
    
    
    24,502,560
    
    
    
    22,336,249Long-term debt, net of current portion
    
    (Note 8)
    
    
    19,575,139
    
    
    
    18,137,240Satellite transponder lease obligation, net of current portion
    
    (Note 8)
    
    
    1,368,760
    
    
    
    1,186,933Customer deposits and advances, noncurrent
    
    
    
    
    
    
    385,315
    
    
    
    2,508,200Other long-term liabilities
    
    
    
    
    
    
    611,734
    
    
    
    461,374Deferred taxes
    
    (Note 20)
    
    
    1,417,155
    
    
    
    165,657Pension plans, seniority premiums and severance indemnities
    
    (Note 10)
    
    
    
    
    
    
    192,160Total liabilities
    
    
    
    
    
    
    47,860,663
    
    
    
    44,987,813Commitments and contingencies
    
    (Note 11)STOCKHOLDERS EQUITYCapital stock issued, no par value
    
    (Note 12)
    
    
    9,889,463
    
    
    
    9,889,463Additional paid-in capital
    
    
    
    
    
    
    4,212,442
    
    
    
    4,212,44214,101,905
    
    
    
    14,101,905Retained earnings:
    
    (Note 13)Legal reserve
    
    
    
    
    
    
    1,575,357
    
    
    
    1,798,387Reserve for repurchase of shares
    
    
    
    
    
    
    5,744,583
    
    
    
    5,744,583Unappropriated earnings
    
    
    
    
    
    
    11,917,996
    
    
    
    11,834,150Net income for the year
    
    
    
    
    
    
    4,460,607
    
    
    
    6,125,54223,698,543
    
    
    
    25,502,662Accumulated other comprehensive loss
    
    (Note 14)
    
    
    (2,647,449
    )
    
    
    (3,546,369
    )Shares repurchased
    
    (Note 13)
    
    
    (6,504,449
    )
    
    
    (7,045,146
    )14,546,645
    
    
    
    14,911,147Total majority interest
    
    
    
    
    
    
    28,648,550
    
    
    
    29,013,052Minority interest
    
    (Note 15)
    
    
    (124,562
    )
    
    
    850,872Total stockholders equity
    
    
    
    
    
    
    28,523,988
    
    
    
    29,863,924Total liabilities and stockholders equity
    
    
    
    
    
    Ps.
    76,384,651
    
    
    Ps.
    74,851,737
  F-5




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##### Table of Contents



GRUPO TELEVISA, S.A.
 
 CONSOLIDATED STATEMENTS OF INCOME
 For the years ended December 31, 2003, 2004 and 2005
 (In thousands of Mexican pesos in purchasing power as of December 31, 2005,
 except per CPO amounts)
 (Notes 1 and 2)
 2003
    
    
    2004
    
    
    2005Net sales
    
    (Note 23)
    
    Ps.
    25,612,386
    
    
    Ps.
    30,291,209
    
    
    Ps.
    32,481,041Cost of sales (excluding depreciation and
amortization)
    
    
    
    
    
    
    14,009,959
    
    
    
    15,328,115
    
    
    
    14,752,396Operating expenses (excluding depreciation and
amortization):Selling
    
    
    
    
    
    
    1,840,155
    
    
    
    2,274,397
    
    
    
    2,665,461Administrative
    
    
    
    
    
    
    1,532,668
    
    
    
    1,701,496
    
    
    
    1,841,428Depreciation and amortization
    
    
    
    
    
    
    1,657,882
    
    
    
    2,144,158
    
    
    
    2,418,969Operating income
    
    (Note 23)
    
    
    6,571,722
    
    
    
    8,843,043
    
    
    
    10,802,787Integral cost of financing, net
    
    (Note 17)
    
    
    667,969
    
    
    
    1,566,687
    
    
    
    1,782,030Restructuring and non-recurring charges
    
    (Note 18)
    
    
    714,406
    
    
    
    408,423
    
    
    
    229,902Other expense, net
    
    (Note 19)
    
    
    590,501
    
    
    
    532,160
    
    
    
    464,220Income before taxes
    
    
    
    
    
    
    4,598,846
    
    
    
    6,335,773
    
    
    
    8,326,635Income tax and asset tax
    
    (Note 20)
    
    
    776,048
    
    
    
    1,208,809
    
    
    
    751,243Employees profit sharing
    
    (Note 20)
    
    
    6,005
    
    
    
    6,736
    
    
    
    19,907782,053
    
    
    
    1,215,545
    
    
    
    771,150Income before equity in earnings of affiliates,
loss from discontinued operations and
cumulative loss effect of accounting changes
    
    
    
    
    
    
    3,816,793
    
    
    
    5,120,228
    
    
    
    7,555,485Equity in earnings of affiliates, net
    
    (Note 5)
    
    
    30,747
    
    
    
    635,490
    
    
    
    160,158Loss from discontinued operations, net
    
    (Note 1(s))
    
    
    (69,736
    )
    
    
    
    
    
    
    Cumulative loss effect of accounting changes, net
    
    (Note 1(b)(n)(r))
    
    
    
    
    
    
    (1,055,636
    )
    
    
    (506,080
    )Consolidated net income
    
    
    
    
    
    
    3,777,804
    
    
    
    4,700,082
    
    
    
    7,209,563Minority interest
    
    (Note 15)
    
    
    131,577
    
    
    
    (239,475
    )
    
    
    (1,084,021
    )Net income
    
    (Note 13)
    
    Ps.
    3,909,381
    
    
    Ps.
    4,460,607
    
    
    Ps.
    6,125,542Net income per CPO
    
    (Note 21)
    
    Ps.
    1.36
    
    
    Ps.
    1.53
    
    
    Ps.
    2.11
  F-6




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##### Table of Contents



GRUPO TELEVISA, S.A.
 
 CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
 For the years ended December 31, 2003, 2004 and 2005
 (In thousands of Mexican pesos in purchasing power as of December 31, 2005)
 (Notes 1 and 2)
 AccumulatedCapital
    
    
    
    
    
    
    
    
    
    
    OtherStock
    
    
    Additional
    
    
    Retained
    
    
    Comprehensive
    
    
    Shares
    
    
    Total
    
    
    Minority
    
    
    TotalIssued
    
    
    Paid-In
    
    
    Earnings
    
    
    (Loss) Income
    
    
    Repurchased
    
    
    Majority
    
    
    Interest
    
    
    Stockholders(Note 12)
    
    
    Capital
    
    
    (Note 13)
    
    
    (Note 14)
    
    
    (Note 13)
    
    
    Interest
    
    
    (Note 15)
    
    
    EquityBalance at January 1, 2003
    
    Ps.
    8,605,090
    
    
    Ps.
    244,606
    
    
    Ps.
    22,069,045
    
    
    Ps.
    (5,691,541
    )
    
    Ps.
    (2,414,449
    )
    
    Ps.
    22,812,751
    
    
    Ps.
    1,287,935
    
    
    Ps.
    24,100,686Dividends
    
    
    
    
    
    
    
    
    
    
    (621,603
    )
    
    
    
    
    
    
    
    
    
    
    (621,603
    )
    
    
    
    
    
    
    (621,603
    )Share cancellation
    
    
    (89,322
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    579,852
    
    
    
    490,530
    
    
    
    
    
    
    
    490,530Repurchase of capital stock
    
    
    
    
    
    
    
    
    
    
    (357,610
    )
    
    
    
    
    
    
    (5,189,864
    )
    
    
    (5,547,474
    )
    
    
    
    
    
    
    (5,547,474
    )Sale of capital stock
    
    
    
    
    
    
    
    
    
    
    (50,958
    )
    
    
    
    
    
    
    128,891
    
    
    
    77,933
    
    
    
    
    
    
    
    77,933Shares issued
    
    
    405,433
    
    
    
    3,967,836
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,373,269
    
    
    
    
    
    
    
    4,373,269Decrease in minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (115,487
    )
    
    
    (115,487
    )Comprehensive income
    
    
    
    
    
    
    
    
    
    
    3,909,381
    
    
    
    3,252,916
    
    
    
    
    
    
    
    7,162,297
    
    
    
    
    
    
    
    7,162,297Balance at December 31, 2003
    
    
    8,921,201
    
    
    
    4,212,442
    
    
    
    24,948,255
    
    
    
    (2,438,625
    )
    
    
    (6,895,570
    )
    
    
    28,747,703
    
    
    
    1,172,448
    
    
    
    29,920,151Dividends
    
    
    
    
    
    
    
    
    
    
    (4,114,065
    )
    
    
    
    
    
    
    
    
    
    
    (4,114,065
    )
    
    
    
    
    
    
    (4,114,065
    )Stock dividends
    
    
    968,262
    
    
    
    
    
    
    
    (968,262
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Repurchase of capital stock
    
    
    
    
    
    
    
    
    
    
    (132,891
    )
    
    
    
    
    
    
    (709,706
    )
    
    
    (842,597
    )
    
    
    
    
    
    
    (842,597
    )Sale of capital stock
    
    
    
    
    
    
    
    
    
    
    (495,101
    )
    
    
    
    
    
    
    1,100,827
    
    
    
    605,726
    
    
    
    
    
    
    
    605,726Decrease in minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,297,010
    )
    
    
    (1,297,010
    )Comprehensive income (loss)
    
    
    
    
    
    
    
    
    
    
    4,460,607
    
    
    
    (208,824
    )
    
    
    
    
    
    
    4,251,783
    
    
    
    
    
    
    
    4,251,783Balance at December 31, 2004
    
    
    9,889,463
    
    
    
    4,212,442
    
    
    
    23,698,543
    
    
    
    (2,647,449
    )
    
    
    (6,504,449
    )
    
    
    28,648,550
    
    
    
    (124,562
    )
    
    
    28,523,988Dividends
    
    
    
    
    
    
    
    
    
    
    (4,305,789
    )
    
    
    
    
    
    
    
    
    
    
    (4,305,789
    )
    
    
    
    
    
    
    (4,305,789
    )Repurchase of capital stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,194,424
    )
    
    
    (1,194,424
    )
    
    
    
    
    
    
    (1,194,424
    )Sale of capital stock
    
    
    
    
    
    
    
    
    
    
    (339,168
    )
    
    
    
    
    
    
    653,727
    
    
    
    314,559
    
    
    
    
    
    
    
    314,559Increase in minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    975,434
    
    
    
    975,434Stock-based compensation
    
    
    
    
    
    
    
    
    
    
    323,534
    
    
    
    
    
    
    
    
    
    
    
    323,534
    
    
    
    
    
    
    
    323,534Comprehensive income (loss)
    
    
    
    
    
    
    
    
    
    
    6,125,542
    
    
    
    (898,920
    )
    
    
    
    
    
    
    5,226,622
    
    
    
    
    
    
    
    5,226,622Balance at December 31, 2005
    
    Ps.
    9,889,463
    
    
    Ps.
    4,212,442
    
    
    Ps.
    25,502,662
    
    
    Ps.
    (3,546,369
    )
    
    Ps.
    (7,045,146
    )
    
    Ps.
    29,013,052
    
    
    Ps.
    850,872
    
    
    Ps.
    29,863,924
  F-7




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##### Table of Contents



GRUPO TELEVISA, S.A.
 
 CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION
 For the years ended December 31, 2003, 2004 and 2005
 (In thousands of Mexican pesos in purchasing power as of December 31, 2005)
 (Notes 1 and 2)
 2003
    
    
    2004
    
    
    2005Operating activities:Consolidated net income
    
    Ps.
    3,777,804
    
    
    Ps.
    4,700,082
    
    
    Ps.
    7,209,563Adjustments to reconcile net income to resources provided by
(used for) operating activities:Equity in earnings of affiliates
    
    
    (30,747
    )
    
    
    (635,490
    )
    
    
    (160,158
    )Depreciation and amortization
    
    
    1,657,882
    
    
    
    2,144,158
    
    
    
    2,418,969Write-off of long-lived assets and other amortization
    
    
    812,206
    
    
    
    283,829
    
    
    
    97,544Deferred taxes
    
    
    (360,946
    )
    
    
    630,108
    
    
    
    (787,777
    )(Gain) loss on disposition of affiliates
    
    
    (484,595
    )
    
    
    126,536
    
    
    
    171,264Loss from discontinued operations
    
    
    69,736
    
    
    
    
    
    
    
    Cumulative loss effect of accounting changes
    
    
    
    
    
    
    1,055,636
    
    
    
    506,0805,441,340
    
    
    
    8,304,859
    
    
    
    9,455,485Changes in operating assets and liabilities:(Increase) decrease in:Trade notes and accounts receivable, net
    
    
    (786,044
    )
    
    
    71,630
    
    
    
    (2,292,060
    )Transmission rights and programming
    
    
    544,399
    
    
    
    322,617
    
    
    
    976,787Inventories
    
    
    16,798
    
    
    
    (112,444
    )
    
    
    46,568Other accounts and notes receivable and other current assets
    
    
    (55,348
    )
    
    
    (381,964
    )
    
    
    796,565Increase (decrease) in:Customer deposits and advances
    
    
    1,938,913
    
    
    
    557,276
    
    
    
    2,233,208Trade accounts payable
    
    
    104,232
    
    
    
    (625,630
    )
    
    
    748,311Other liabilities, taxes payable and deferred taxes
    
    
    (275,580
    )
    
    
    (180,471
    )
    
    
    (742,530
    )Pension plans and seniority premiums
    
    
    74,103
    
    
    
    65,623
    
    
    
    74,6521,561,473
    
    
    
    (283,363
    )
    
    
    1,841,501Resources provided by operating activities
    
    
    7,002,813
    
    
    
    8,021,496
    
    
    
    11,296,986Financing activities:Issuance of Senior Notes due 2025
    
    
    
    
    
    
    
    
    
    
    6,375,900Prepayments of Senior Notes and UDIs denominated Notes
    
    
    
    
    
    
    
    
    
    
    (5,679,629
    )Other increase in debt
    
    
    1,208,978
    
    
    
    4,323,363
    
    
    
    Other decrease in debt
    
    
    (1,399,910
    )
    
    
    (2,380,366
    )
    
    
    (5,380,010
    )Repurchase and sale of capital stock
    
    
    (4,979,011
    )
    
    
    (236,873
    )
    
    
    (879,865
    )Series A Shares of capital stock issued
    
    
    4,373,268
    
    
    
    
    
    
    
    Dividends paid
    
    
    (621,603
    )
    
    
    (4,114,064
    )
    
    
    (4,305,789
    )Gain on issuance of shares of investee
    
    
    
    
    
    
    111,465
    
    
    
    Minority interest
    
    
    16,090
    
    
    
    (53,136
    )
    
    
    (108,587
    )Translation effect
    
    
    (334,291
    )
    
    
    (50,339
    )
    
    
    112,208Resources used for financing activities
    
    
    (1,736,479
    )
    
    
    (2,399,950
    )
    
    
    (9,865,772
    )Investing activities:Due from affiliated companies, net
    
    
    (477,670
    )
    
    
    (37,582
    )
    
    
    534,864Investments
    
    
    (662,731
    )
    
    
    (247,165
    )
    
    
    (1,201,361
    )Disposition of investments
    
    
    583,734
    
    
    
    37,500
    
    
    
    105,015Investments in property, plant and equipment
    
    
    (1,143,728
    )
    
    
    (2,094,532
    )
    
    
    (2,738,095
    )Disposition of property, plant and equipment
    
    
    450,487
    
    
    
    153,494
    
    
    
    317,008Disposition of discontinued operations
    
    
    (102,553
    )
    
    
    
    
    
    
    Investment in goodwill and other intangible assets
    
    
    (568,002
    )
    
    
    (219,671
    )
    
    
    (1,658,611
    )Disposition of goodwill and other intangible assets
    
    
    28,320
    
    
    
    270,613
    
    
    
    674,928Other assets
    
    
    25,087
    
    
    
    (101,732
    )
    
    
    117,045Resources used for investing activities
    
    
    (1,867,056
    )
    
    
    (2,239,075
    )
    
    
    (3,849,207
    )Net increase (decrease) in cash and temporary investments
    
    
    3,399,278
    
    
    
    3,382,471
    
    
    
    (2,417,993
    )Net increase in cash and temporary investments upon Innovas
consolidation
    
    
    
    
    
    
    483,451
    
    
    
    Cash and temporary investments at beginning of year
    
    
    9,930,747
    
    
    
    13,330,025
    
    
    
    17,195,947Cash and temporary investments at end of year
    
    Ps.
    13,330,025
    
    
    Ps.
    17,195,947
    
    
    Ps.
    14,777,954
  F-8




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##### Table of Contents



GRUPO TELEVISA, S.A.
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 For the Years Ended December 31, 2003, 2004 and 2005
 (In thousands of Mexican pesos in purchasing power as of December 31, 2005,
 except per CPO, per share and exchange rate amounts)
 1. Accounting policies
  a) Basis of presentation
    b) Members of the Group
  CompanysConsolidated
Entity
    

Ownership (1)
    

Business Segment (2)Television BroadcastingTelesistema
Mexicano, S. A. de C. V. and subsidiaries, including  Televisa, S. A.
de C. V.
    
    
    100
    %
    
    Pay Television NetworksProgramming ExportsTelevisión Independiente de México, S. A. de C. V. and subsidiaries
    
    
    100
    %
    
    Television BroadcastingCampus
América, S. A. de C. V. and subsidiaries, including TuTv, LLC (TuTv) (3)
    
    
    100
    %
    
    Television BroadcastingPay Television NetworksEditorial Televisa, S. A. de C. V. and subsidiaries
    
    
    100
    %
    
    PublishingGrupo Distribuidoras Intermex, S. A. de C. V. and subsidiaries
    
    
    100
    %
    
    Publishing DistributionInnova Holdings, S. de R. L. de C. V. and Innova, S. de R. L. de
C.V. and subsidiaries (collectively, Sky Mexico) (3)
    
    
    60
    %
    
    Sky MexicoEmpresas Cablevisión, S. A. de C. V. and subsidiaries
    
    
    51
    %
    
    Cable TelevisiónSistema Radiópolis, S. A. de C. V. and subsidiaries
    
    
    50
    %
    
    RadioCorporativo Vasco de Quiroga, S. A. de C. V. and subsidiaries
    
    
    100
    %
    
    Other BusinessesCVQ Espectáculos, S. A. de C. V. and subsidiaries
    
    
    100
    %
    
    Other Businesses
 
 (1)
    
    Percentage of equity interest directly or indirectly held by the Company in the holding
entity.(2)
    
    See Note 23 for a description of each of the Groups business segments.(3)
    
    Mexican GAAP does not provide specific guidance on the accounting for the consolidation of
VIEs. Effective April 1, 2004, the Group adopted the guidelines of the Financial Accounting
Standards Board Interpretation No. 46 (FIN 46), Consolidation of Variable Interest
Entities, as permitted under the scope of Mexican GAAP Bulletin A-8,
Supplementary Application of International Accounting Standards (Bulletin A-8). FIN 46,
which became effective in F-9




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##### Table of Contents



2004, requires the primary beneficiary of a variable interest entity to
consolidate that entity. The primary beneficiary of a VIE is the party that absorbs a majority of
the entitys expected losses, receives a majority of the entitys expected residual returns, or
both, as a result of ownership, contractual or other financial interest in the entity. In
accordance with the guidelines of FIN 46, the Group identified Sky Mexico and TuTv as VIEs and
the Group as the primary beneficiary of the investment in each of these entities, and began to
include in its consolidated financial statements the assets, liabilities and results of
operations of Sky Mexico and TuTv. As a result of adoption of FIN 46 on April 1, 2004, the Group
recognized at that date a consolidated cumulative loss effect of Ps.1,055,637, net of income tax
in the amount of Ps.319,394, in its consolidated statement of income for the year ended December
31, 2004, primarily in connection with Sky Mexicos accumulated losses not recognized by the
Group in prior periods and the first quarter of 2004. Before April 1, 2004, the Group accounted
for its investment in Sky Mexico by applying the equity method, and recognized equity in losses
in excess of its investment up to the amount of the guarantees made by the Group in connection
with certain capital lease obligations of Sky Mexico (see Note 1(g)).  Expiration DatesTelevision Broadcasting
    
    In 2021Sky Mexico
    
    In 2020 and 2026Cable Television
    
    In 2029Radio
    
    Various from 2006 to 2015
 c) Foreign currency translation
    d) Temporary investments
   F-10




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##### Table of Contents



e) Transmission rights and programming
      f) Inventories
  g) Investments
   h) Property, plant and equipment
   i) Intangible assets and deferred financing costs
  F-11




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##### Table of Contents



j) Impairment of long-lived assets
   k) Customer deposits and advances
   l) Stockholders equity
  m) Revenue recognition
  
    
    Advertising revenues, including deposits and advances from customers for future
advertising, are recognized at the time the advertising services are rendered.
    
    Revenues from program services for pay television and licensed television programs are
recognized when the programs are sold and become available for broadcast.
 F-12




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##### Table of Contents




    
    Revenues from magazine subscriptions are initially deferred and recognized
proportionately as products are delivered to subscribers. Revenues from the sales of
magazines and books are recognized when the merchandise is delivered, net of a provision
for estimated returns.
    
    The marginal revenue from publishing distribution is recognized upon distribution of
the products.
    
    Sky Mexico program service revenues, including advances from customers for future DTH
program services and installation fees, are recognized at the time the DTH service is
provided.
    
    Cable television subscription, pay-per-view and installation fees are recognized in the
period in which the services are rendered.
    
    Revenues from attendance to soccer games, including revenues from advance ticket sales
for soccer games and other promotional events, are recognized on the date of the relevant
event.
    
    Motion picture production and distribution revenues are recognized as the films are
exhibited.
 n) Pension plans, seniority premiums and indemnities
    o) Income tax
  p) Derivative financial instruments
   F-13




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##### Table of Contents



q) Comprehensive income
  r) Stock-based compensation
  s) Prior years financial statements
   December 31, 2002
    
    
    102.904December 31, 2003
    
    
    106.996December 31, 2004
    
    
    112.550December 31, 2005
    
    
    116.301
   t) New Mexican Financial Reporting Standards
  F-14




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##### Table of Contents



2. Acquisitions and dispositions
       F-15




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##### Table of Contents



3. Trade notes and accounts receivable
  2004
    
    
    2005Non-interest bearing notes received as customer deposits and advances
    
    Ps.
    10,553,476
    
    
    Ps.
    12,299,271Accounts receivable, including value-added tax receivables related to
advertising services
    
    
    2,210,158
    
    
    
    2,693,762Allowance for doubtful accounts
    
    
    (1,159,394
    )
    
    
    (1,096,733
    )Ps.
    11,604,240
    
    
    Ps.
    13,896,300
 F-16




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##### Table of Contents



4. Transmission rights and programming
  2004
    
    
    2005Transmission rights
    
    Ps.
    4,321,899
    
    
    Ps.
    3,399,876Programming
    
    
    4,033,188
    
    
    
    3,641,5928,355,087
    
    
    
    7,041,468Non-current portion of:Transmission rights
    
    
    2,225,541
    
    
    
    1,618,079Programming
    
    
    2,415,862
    
    
    
    2,302,8884,641,403
    
    
    
    3,920,967Current portion of transmission rights and programming
    
    Ps.
    3,713,684
    
    
    Ps.
    3,120,501
 5. Investments
  Ownership %as of December2004
    
    
    2005
    
    
    31, 2005Accounted for by the equity method:Univision (a)
    
    Ps.
    5,926,633
    
    
    Ps.
    5,658,406
    
    
    
    9.9
    %OCEN (see Note 2)
    
    
    516,828
    
    
    
    500,747
    
    
    
    40.0
    %DTH TechCo Partners (b)
    
    
    (833
    )
    
    
    
    
    
    
    30.0
    %Volaris (see Note 2)
    
    
    
    
    
    
    240,465
    
    
    
    25.0
    %Other
    
    
    159,101
    
    
    
    97,5366,601,729
    
    
    
    6,497,154Other investments:Held-to-maturity securities (see Note 1 (g))(c)
    
    
    
    
    
    
    893,855Deposits in escrow (d)
    
    
    145,083
    
    
    
    133,194TechCo (b)
    
    
    144,960
    
    
    
    Univision (a)
    
    
    23,653
    
    
    
    23,653Other
    
    
    67,512
    
    
    
    39,653381,208
    
    
    
    1,090,355Ps.
    6,982,937
    
    
    Ps.
    7,587,509
 
 (a)
    
    The Group accounts for this investment under the equity method due to the Groups continued
ability to exercise significant influence over Univisions operations. As of December 31, 2004
and 2005, the Group owned 16,594,500 shares Class A and 13,593,034 shares Class T of
common stock of Univision, as well as warrants to acquire 6,374,864 shares Class A and
2,727,136 shares Class T of common stock of Univision. Substantially all of these warrants
can be exercised at a price of U.S.$38.261 per share, and expire in December 2017 (see Note
9). Any shares of Univisions common stock owned by the Group and those shares of Univisions
common stock that may be purchased by the Group in connection with related warrants and
warrant purchase agreements are intended to be held as equity securities accounted for under
the equity method. The warrants to purchase 6,274,864 shares of Univisions Class A Common
Stock and 2,725,136 shares of Univisions Class T Common Stock are not accounted for at any
cost since they were acquired by the Group as a consideration for surrendering certain
governance rights previously held by the Group in Univision. The warrants to purchase 100,000
shares of Univisions Class A Common Stock are accounted at acquisition cost and classified
as other investments since the shares that may be purchased through these instruments are
intended to be held by the Group as an equity investment in Univision (see Note 9). In
September 2003, Univision and Hispanic Broadcasting Corporation (HBC), a leading
Spanish-language radio group in the United States, completed a merger of their businesses. As
a result of this merger, the Group (i) decreased its ownership in Univision from approximately
14.7% to 10.9% on a fully diluted basis; and (ii) increased the carrying value of its
investment in Univision by recognizing a net other comprehensive income of approximately
U.S.$250.6 million (Ps.3,057,553) in 2003 (see Note 14). The Groups ownership stake in
Univision as of December 31, 2005, was approximately 11.4% on a fully diluted basis. The
carrying value of the Groups net investment in Univision at December 31, 2005, also included
goodwill in the amount of Ps.5,478,928 (see Note 7). The quoted market price of Univisions
common stock at December 31, 2005, and March 16, 2006, was U.S.$29.39 per share and U.S.$33.76
per share, respectively. F-17




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##### Table of Contents



(b)
    
    General partnership engaged in providing technical services to DTH ventures in Latin America
through September 2005. During 2004, the Group provided funding to TechCo for approximately
U.S.$4.5 million (Ps.51,349) in the form of long-term notes with principal and interest
maturities in 2008, bearing annual interest at LIBOR plus 2.5%. As of December 31, 2004,
promissory notes and accrued interest receivable due from TechCo were approximately U.S.$12.6
million (Ps.144,960). Additionally, in the fourth quarter of 2004, the Group made a capital
contribution to TechCo in the amount of U.S.$0.9 million (Ps.10,258). In October 2005, this
investment was disposed by the Group (see Note 2).(c)
    
    Held-to-maturity securities represent structured notes and corporate fixed income securities
with maturities in 2008. These investments are stated at cost.(d)
    
    In connection with the disposal of an investment of the Group in 1997, the Group granted
collateral to secure certain indemnification obligations which consisted, at December 31, 2004
and 2005, of short-term securities of approximately U.S.$12.6 million (Ps.145,083) and
U.S.$12.5 million (Ps.133,194), respectively. After the expiration of applicable tax statutes
of limitations, the collateral will be reduced to a de minimus amount. The collateral
agreement will terminate in approximately two years (see Note 11).  6. Property, plant and equipment
  2004
    
    
    2005Buildings
    
    Ps.
    7,807,516
    
    
    Ps.
    7,964,833Buildings improvements
    
    
    1,720,042
    
    
    
    1,582,373Technical equipment
    
    
    17,810,157
    
    
    
    17,970,490Satellite transponders
    
    
    1,714,647
    
    
    
    1,636,152Furniture and fixtures
    
    
    596,442
    
    
    
    500,070Transportation equipment
    
    
    1,172,949
    
    
    
    1,105,876Computer equipment
    
    
    1,488,757
    
    
    
    1,413,73132,310,510
    
    
    
    32,173,525Accumulated depreciation
    
    
    (16,993,039
    )
    
    
    (17,174,543
    )15,317,471
    
    
    
    14,998,982Land
    
    
    3,827,822
    
    
    
    3,820,812Construction in progress
    
    
    652,805
    
    
    
    908,753Ps.
    19,798,098
    
    
    Ps.
    19,728,547
     F-18




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##### Table of Contents



7. Intangible assets and deferred charges, net
  2004
    
    
    2005Gross
    
    
    
    
    
    
    
    
    
    
    GrossCarrying
    
    
    Accumulated
    
    
    Net Carrying
    
    
    Carrying
    
    
    Accumulated
    
    
    Net CarryingAmount
    
    
    Amortization
    
    
    Amount
    
    
    Amount
    
    
    Amortization
    
    
    AmountIntangible assets with
indefinite lives:Goodwill
    
    
    
    
    
    
    
    
    
    Ps.
    7,771,617
    
    
    
    
    
    
    
    
    
    
    Ps.
    7,200,018Publishing trademarks
    
    
    
    
    
    
    
    
    
    
    513,393
    
    
    
    
    
    
    
    
    
    
    
    455,038Television network concession
    
    
    
    
    
    
    
    
    
    
    602,608
    
    
    
    
    
    
    
    
    
    
    
    602,608Intangible assets with finite
lives and deferred charges:Licenses and software
    
    Ps.
    1,053,735
    
    
    Ps.
    (764,666
    )
    
    
    289,069
    
    
    Ps.
    1,134,044
    
    
    Ps.
    (793,578
    )
    
    
    340,466Subscriber list
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    570,047
    
    
    
    (137,249
    )
    
    
    432,798Other intangible assets
    
    
    232,224
    
    
    
    (113,105
    )
    
    
    119,119
    
    
    
    195,791
    
    
    
    (72,937
    )
    
    
    122,854Deferred financing costs
(see Note 8)
    
    
    409,795
    
    
    
    (243,843
    )
    
    
    165,952
    
    
    
    1,059,585
    
    
    
    (200,094
    )
    
    
    859,491Ps.
    1,695,754
    
    
    Ps.
    (1,121,614
    )
    
    Ps.
    9,461,758
    
    
    Ps.
    2,959,467
    
    
    Ps.
    (1,203,858
    )
    
    Ps.
    10,013,273
   ForeignBalance as of
    
    
    
    
    
    
    Currency
    
    
    Adjusted
    
    
    
    
    
    
    Balance as ofDecember 31,
    
    
    
    
    
    
    Translation
    
    
    Goodwill/
    
    
    Impairment
    
    
    December 31,2004
    
    
    Acquisitions
    
    
    Adjustments
    
    
    Trademarks
    
    
    Adjustments
    
    
    2005Business Segments:Television Broadcasting
    
    Ps.
    1,279,742
    
    
    Ps.
    20,566
    
    
    Ps.
    
    
    
    Ps.
    
    
    
    Ps.
    
    
    
    Ps.
    1,300,308Publishing Distribution
    
    
    
    
    
    
    23,670
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23,670Other Businesses
    
    
    36,499
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    36,499Equity-method investees
    
    
    6,455,376
    
    
    
    
    
    
    
    (258,471
    )
    
    
    (357,364
    )
    
    
    
    
    
    
    5,839,541Ps.
    7,771,617
    
    
    Ps.
    44,236
    
    
    Ps.
    (258,471
    )
    
    Ps.
    (357,364
    )
    
    Ps.
    
    
    
    Ps.
    7,200,018Trademarks (Publishing)
    
    Ps.
    513,393
    
    
    Ps.
    
    
    
    Ps.
    (3,979
    )
    
    Ps.
    (46,937
    )
    
    Ps.
    (7,439
    )
    
    Ps.
    455,038
  F-19




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##### Table of Contents



8. Long-term debt and satellite transponder lease obligation
  2004
    
    
    2005U.S.$5.3 million 11.875% Series B Senior Notes due 2006 (1)
    
    Ps.
    61,554
    
    
    Ps.
    56,777U.S.$200.0 million 8.625% Senior Notes due 2005 (2)
    
    
    2,304,112
    
    
    
    U.S.$300.0 in 2004 and U.S.$75.5 million in 2005 8% Senior Notes due
2011(2) (3)
    
    
    3,456,169
    
    
    
    802,131U.S.$300.0 million 8.50% Senior Notes due 2032 (2)
    
    
    3,456,169
    
    
    
    3,187,950U.S.$600.0 million 6.625% Senior Notes due 2025 (2) (3)
    
    
    
    
    
    
    6,375,900U.S.$88.0 million 12.875% Senior Notes due 2007 (4)
    
    
    1,013,810
    
    
    
    U.S.$300.0 million 9.375% Senior Notes due 2013 (5)
    
    
    3,456,169
    
    
    
    3,187,950Other U.S. dollar debt (6)
    
    
    108,622
    
    
    
    42,0628.15% UDI-denominated Notes due 2007 (3) (7)
    
    
    3,966,662
    
    
    
    941,071Mexican peso long-term loans (8)
    
    
    4,011,851
    
    
    
    3,882,460Sky Mexicos long-term loan (4)
    
    
    1,045,727
    
    
    
    Other Mexican peso bank loans (9)
    
    
    99,199
    
    
    
    446Other currency debt
    
    
    2,068
    
    
    
    950Total long-term debt
    
    
    22,982,112
    
    
    
    18,477,697Less: Current portion
    
    
    3,406,973
    
    
    
    340,457Long-term debt, net of current portion
    
    Ps.
    19,575,139
    
    
    Ps.
    18,137,240Satellite transponder lease obligation (10)
    
    Ps.
    1,441,861
    
    
    Ps.
    1,262,537Less: Current portion
    
    
    73,101
    
    
    
    75,604Satellite transponder lease obligation, net of current portion
    
    Ps.
    1,368,760
    
    
    Ps.
    1,186,933
 
 (1)
    
    These securities are unsecured, unsubordinated obligations of the Company, rank pari passu in
right of payment with all existing and future unsecured, unsubordinated obligations of the
Company, are senior in right of payment to all future subordinated indebtedness of the
Company, and are effectively subordinated to all existing and future liabilities of the
Companys subsidiaries. Interest on these securities, including additional amounts payable in
respect of certain Mexican withholding taxes, is 12.49% per annum and is payable
semi-annually.(2)
    
    These Senior Notes are unsecured obligations of the Company, rank equally in right of payment
with all existing and future unsecured and unsubordinated indebtedness of the Company, and are
junior in right of payment to all of the existing and future liabilities of the Companys
subsidiaries. Interest on the Senior Notes due 2005, 2011, 2025 and 2032, including additional
amounts payable in respect of certain Mexican withholding taxes, is 9.07%, 8.41%, 6.97% and
8.94% per annum, respectively, and is payable semi-annually. These Senior Notes may not be
redeemed prior to maturity, except in the event of certain changes in law affecting the
Mexican withholding tax treatment of certain payments on the securities, in which case the
securities will be redeemable, as a whole but not in part, at the option of the Company. The
Senior Notes due 2011 and 2032 were priced at 98.793% and 99.431%, respectively, for a yield
to maturity of 8.179% and 8.553%, respectively. The agreement of these Senior Notes contains
covenants that limit the ability of the Company and certain restricted subsidiaries engaged in
Television Broadcasting, Pay Television Networks and Programming Exports, to incur or assume
liens, perform sale and leaseback transactions, and consummate certain mergers, consolidations
and similar transactions. Substantially all of these Senior Notes are registered with the U.S.
Securities and Exchange Commission (the SEC).(3)
    
    In March and May 2005, the Company issued these Senior Notes in the aggregate amount of
U.S.$400.0 million and U.S.$200.0 million, respectively, which were priced at 98.081% and
98.632%, respectively, for a yield to maturity of 6.802% and 6.787%, respectively. The net
proceeds of the U.S.$400.0 million issuance, together with cash on hand, were used to fund the
Groups tender offers made and expired in March 2005 for any or all of the Senior Notes due
2011 and the Mexican peso equivalent of UDI-denominated Notes due 2007, and prepaid principal
amount of these securities in the amount of approximately U.S.$222.0 million and Ps.2,935,097
(nominal), respectively, representing approximately 74% and 76% of the outstanding principal
amount of these securities, respectively. The net proceeds of the U.S.$200.0 million issuance
were used for corporate purposes, including the prepayment of some of the Groups outstanding
indebtedness. F-20




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##### Table of Contents



(4)
    
    In January 2005, Sky Mexico prepaid all of the outstanding amounts of these Senior Notes by
using the net proceeds of a long-term credit agreement entered into in December 2004 by Sky
Mexico with a Mexican bank in the aggregate principal amount of Ps.1,045,727 (Ps.1,012,000
nominal), with a partial maturity (50%) in 2010 and the remainder in 2011, and interest of
10.55% per annum payable on a monthly basis. In July 2005, Sky Mexico prepaid all of the
outstanding amounts of the Ps.1,045,727 loan with the net proceeds of a long-term credit
agreement entered into by Sky Mexico with the Company in the same principal amount, and with
the same maturity and interest conditions.(5)
    
    In September 2003, Innova completed the offering of these unsecured and unsubordinated Senior
Notes, which indentures contain certain restrictive covenants for Innova on additional
indebtedness, liens, sales and leasebacks, restricted payments, asset sales, and certain
mergers, consolidations and similar transactions. Interest on these Senior Notes, including
additional amounts payable in respect of certain Mexican withholding taxes, is 9.8580%, and is
payable semi-annually. Innova may, at its own option, redeem these Senior Notes, in whole or
in part, at any time on or after September 19, 2008 at redemption prices from 104.6875% to
101.5625% between September 19, 2008 through September 18, 2011, or 100% commencing on
September 19, 2011, plus accrued and unpaid interest, if any. Additionally, on or before
September 19, 2006, Innova may, at its own option and subject to certain requirements, use the
proceeds from one or more qualified equity offerings to redeem up to 35% of the aggregate
principal amount of these Senior Notes at 109.375% of their principal amount, plus accrued and
unpaid interest.(6)
    
    Includes notes payable to banks, bearing annual interest rates which vary between 0.11 and
1.25 points above LIBOR. The maturities of this debt at December 31, 2005, are various from
2006 to 2010.(7)
    
    Notes denominated in Mexican Investment Units (Unidades de Inversión or UDIs),
representing 1,086,007,800 UDIs and 258,711,400 UDIs at December 31, 2004 and 2005,
respectively. Interest on these notes is payable semi-annually. The balance as of December 31,
2004 and 2005 includes restatement of Ps.866,681 and Ps.226,404, respectively. The UDI value
as of December 31, 2005, was of Ps.3.637532 per UDI.(8)
    
    In May 2003, May 2004 and October 2004, the Company entered into long-term credit agreements
with a Mexican bank in an aggregate amount of Ps.800,000, Ps.1,162,500 and Ps.2,000,000,
respectively, with various maturities from 2004 to 2012. Interest on these loans is, in a
range of 8.925% to 10.35% per annum, and is payable on a monthly basis. The net proceeds of
these loans were primarily used to pay, prepay and refinance amounts outstanding under certain
Companys debt with original maturities from 2003 to 2006. Under the terms of these credit
agreements, the Company and certain restricted subsidiaries engaged in television
broadcasting, pay television networks and programming exports are required to maintain (a)
certain financial coverage ratios related to indebtedness and interest expense; and (b)
certain restrictive covenants on indebtedness, dividend payments, issuance and sale of capital
stock, and liens.(9)
    
    The 2004 balance also include a long-term loan of Ps.99,199, granted by a commercial Mexican
bank in 2001 to refinance the redemption of the Companys Senior Discount Debentures then
outstanding, with principal and interest thereof payable on a quarterly basis through May 2006
and annual interest rate equal to the Mexican interbank rate plus 30 basis points. The terms
of this loan include certain financial ratios and covenants. In May 2005, the Group prepaid
all of the outstanding amounts of a Ps.80.0 million long-term loan, which originally matured
in 2006.(10)
    
    Sky Mexico is committed to pay a monthly fee of U.S.$1.7 million under a capital lease
agreement entered into with PanAmSat Corporation in February 1999 for satellite signal
reception and retransmission service from 12 KU-band transponders on satellite PAS-9, which
became operational in September 2000. The service term for PAS-9 will end at the earlier of
(a) the end of 15 years or (b) the date PAS-9 is taken out of service. The present value of
Sky Mexico future obligations from the PAS-9 agreement was determined using the Sky Mexico
incremental borrowing rate at the lease commencement date of 11.5% (see Note 6). Through
September 2004, the obligations of Sky Mexico under the PAS-9 agreement were proportionately
guaranteed by the Company and the other Sky Mexico equity owners in relation to their
respective ownership interests. Beginning October 2004, this obligation is being guaranteed by
the Company at 51% (see Note 11). F-21




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##### Table of Contents



Maturities of debt and satellite transponder lease obligation
  2006
    
    Ps.
    340,4572007
    
    
    946,0242008
    
    
    484,8362009
    
    
    1,163,1712010
    
    
    1,026,822Thereafter
    
    
    14,516,387Ps.
    18,477,697
  2006
    
    Ps.
    216,7812007
    
    
    216,7812008
    
    
    216,7812009
    
    
    216,7812010
    
    
    216,781Thereafter
    
    
    1,012,6212,096,526Less: amount representing interest
    
    
    833,989Ps.
    1,262,537
 9. Financial instruments
   F-22




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##### Table of Contents



2004
    
    
    2005Carrying Value
    
    
    Fair Value
    
    
    Carrying Value
    
    
    Fair ValueAssets:Univision warrants (see Note 5)
    
    Ps.
    23,653
    
    
    Ps.
    1,519,424
    
    
    Ps.
    23,653
    
    
    Ps.
    1,318,326Held-to-maturity securities (see Note 5)
    
    
    
    
    
    
    
    
    
    
    893,855
    
    
    
    884,113Liabilities:Senior Notes due 2005, 2011, 2025 and 2032
    
    Ps.
    9,216,450
    
    
    Ps.
    10,361,940
    
    
    Ps.
    10,365,981
    
    
    Ps.
    11,280,616Other long-term debt securities
    
    
    4,531,533
    
    
    
    5,025,258
    
    
    
    3,244,727
    
    
    
    3,577,637UDI-denominated long-term securities
    
    
    3,966,662
    
    
    
    4,298,260
    
    
    
    941,071
    
    
    
    1,002,817Long-term notes payable to Mexican banks
    
    
    5,057,578
    
    
    
    5,199,561
    
    
    
    3,882,460
    
    
    
    3,964,110Derivative financial instruments:Assets:UDI forwards (a)
    
    Ps.
    104,927
    
    
    Ps.
    146,631
    
    
    Ps.
    
    
    
    Ps.
    Liabilities:Sky Mexicos interest rate swaps (b)
    
    Ps.
    
    
    
    Ps.
    12,200
    
    
    Ps.
    73,522
    
    
    Ps.
    73,522Foreign currency forwards (c)
    
    
    24,954
    
    
    
    43,897
    
    
    
    3,366
    
    
    
    3,366Interest rate swaps (d)
    
    
    20,294
    
    
    
    32,837
    
    
    
    300,481
    
    
    
    300,481
 
 (a)
    
    In connection with the notes denominated in Mexican Investment Units (Unidades de Inversión
or UDIs), during April, 2004, the Company entered into forward contracts with three
financial institutions covering the total amount of UDIs payable at the maturity of the notes
in 2007. Through these contracts, the Company fixed the price of the UDI at Ps.3.41067 in
exchange for payments of interest over the notional amount in pesos at an average rate of
4.06% with half-yearly payments. As of December 31, 2004, the Company recorded a net benefit
of Ps.104,927 derived from the difference in the price of the UDI published by the Mexican
Central Bank at that date and the price fixed in these contracts. In March 2005, in connection
with the issuance of the Senior Notes due 2025 and as a result of the tender offer of the
UDI-denominated Notes due 2007, the Company terminated early these contracts and recorded an
additional net benefit of Ps.6,302, in the year ended December 31, 2005.(b)
    
    In February 2004, Sky Mexico entered into coupon swap agreements to hedge a portion of its
U.S. dollar foreign exchange exposure related to its Senior Notes due 2013. Under these
transactions, Sky Mexico receives semi-annual payments calculated based on the aggregate
notional amount of U.S.$300.0 million at an annual rate of 9.375%, and Sky Mexico makes
monthly payments calculated based on an aggregate notional amount of approximately
Ps.3,282,225 at an annual rate of 10.25%. These transactions will terminate in September 2008.
As of December 31, 2005, Sky Mexico recorded the change in fair value of these transactions in
the integral cost of financing (foreign exchange loss).(c)
    
    In 2004 and 2005, the Company entered into forward contracts with diverse financial
institutions to buy U.S.$185.0 million of the Senior Notes due 2005 for hedge purposes. The
average price fixed in these agreements was Ps.11.73 per U.S. dollar. In the years ended
December 31, 2004 and 2005, as a result of the depreciation of the exchange rate of the U.S.
dollar in relation to the Mexican peso, the Company recorded a loss for these transactions of
Ps.24,954 and Ps.148,955, respectively, in the integral cost of financing (foreign exchange
gain or loss). In addition, as of December 31, 2005, the Group had entered into forward
exchange contracts to cover cash flow requirements on a notional amount of U.S.$85.0 million
to exchange U.S. dollars and Mexican pesos at an average exchange rate of Ps.10.85 per U.S.
dollar in 2006.(d)
    
    In order to reduce the adverse effects of exchange rates on the Senior Notes due 2011, 2025
and 2032, during 2004 and 2005, the Company entered into interest rate swap agreements with
various financial institutions that allow the Company to hedge against Mexican peso
depreciation on interest payments for a period of five years. Under these transactions, the
Company receives semi-annual payments based on the aggregate notional amount of U.S.$550.0
million and U.S.$890.0 million as of December 31, 2004 and 2005, respectively, at an average
annual rate of 8.27% and 7.37%, respectively, and the Company makes semi-annual payments based
on an aggregate notional amount of approximately Ps.6,177,191 and Ps.9,897,573 as of December
31, 2004 and 2005, respectively, at an average annual rate of 9.26% and 8.28% respectively,
without an exchange of the notional amount upon which the payments are based. As of December
31, 2004, the Company recorded a loss in the integral cost of financing (foreign exchange
loss) derived of comparing the interest payable calculated at the exchange rate of the balance
sheet date at year-end. In the year ended December 31, 2005, the Company recorded a loss of
Ps.368,345 in the integral cost of financing (foreign F-23




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##### Table of Contents



10. Pension plans, seniority premiums and severance indemnities
     2004
    
    
    2005Seniority premiums:Actuarial present value of benefit obligations:Vested benefit obligations
    
    Ps.
    160,244
    
    
    Ps.
    153,110Nonvested benefit obligations
    
    
    68,843
    
    
    
    79,691Accumulated benefit obligation
    
    
    229,087
    
    
    
    232,801Benefit attributable to projected salaries
    
    
    17,473
    
    
    
    18,484Projected benefit obligation
    
    
    246,560
    
    
    
    251,285Plan assets
    
    
    366,057
    
    
    
    450,594Projected benefit obligation in excess of plan assets
    
    
    119,497
    
    
    
    199,309Items to be amortized over a 12-year period:Transition obligation
    
    
    139,004
    
    
    
    118,424Unrecognized prior service cost
    
    
    (109,883
    )
    
    
    (108,879
    )Unrecognized net loss (gain) from experience differences
    
    
    72,747
    
    
    
    (8,361
    )101,868
    
    
    
    1,184Net projected asset
    
    
    221,365
    
    
    
    200,493Pension plans:Actuarial present value of benefit obligations:Vested benefit obligations
    
    
    233,192
    
    
    
    273,862Nonvested benefit obligations
    
    
    280,498
    
    
    
    295,036Accumulated benefit obligation
    
    
    513,690
    
    
    
    568,898Benefit attributable to projected salaries
    
    
    134,529
    
    
    
    144,218Projected benefit obligation
    
    
    648,219
    
    
    
    713,116Plan assets
    
    
    788,636
    
    
    
    975,350Projected benefit obligation in excess of plan assets
    
    
    140,417
    
    
    
    262,234Items to be amortized over a 19-year period:Transition obligation
    
    
    136,311
    
    
    
    123,959Unrecognized prior service cost
    
    
    (16,628
    )
    
    
    (14,727
    )Unrecognized net loss from experience differences
    
    
    (340,706
    )
    
    
    (473,084
    )(221,023
    )
    
    
    (363,852
    )Net projected liability
    
    
    (80,606
    )
    
    
    (101,618
    )
 F-24




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##### Table of Contents



2004
    
    
    2005Severance indemnities:Actuarial present value of benefit obligations:Vested benefit obligations
    
    
    
    
    
    
    Nonvested benefit obligations
    
    
    
    
    
    
    265,862Accumulated benefit obligation
    
    
    
    
    
    
    265,862Benefit attributable to projected salaries
    
    
    
    
    
    
    25,173Projected benefit obligation
    
    
    
    
    
    
    291,035Plan assets
    
    
    
    
    
    
    Net projected liability
    
    
    
    
    
    
    (291,035
    )Total labor assets (liabilities)
    
    Ps.
    140,759
    
    
    Ps.
    (192,160
    )
  11. Commitments and contingencies
       Thousands ofU.S. dollars2006
    
    
    U.S.$14,8662007
    
    
    14,4182008
    
    
    13,0672009
    
    
    10,8982010 and thereafter
    
    
    24,404U.S.$77,653
  F-25




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##### Table of Contents



12. Capital Stock, Stock Purchase Plan and Long-term Retention Plan
 Capital Stock
    Authorized
    
    Repurchased
    
    Acquired by
    
    Acquired by aand
    
    by the
    
    the Companys
    
    CompanysIssued(1)
    
    Company(2)
    
    Trust(3)
    
    Subsidiary(4)
    
    OutstandingSeries A Shares
    
    
    124,736,244
    
    
    
    (1,166,260
    )
    
    
    (7,406,648
    )
    
    
    (1,917,483
    )
    
    
    114,245,853Series B Shares
    
    
    60,269,683
    
    
    
    (1,026,309
    )
    
    
    (4,019,585
    )
    
    
    (1,253,198
    )
    
    
    53,970,590Series D Shares
    
    
    92,133,722
    
    
    
    (1,632,764
    )
    
    
    (2,677,881
    )
    
    
    (1,960,833
    )
    
    
    85,862,244Series L Shares
    
    
    92,133,722
    
    
    
    (1,632,764
    )
    
    
    (2,677,881
    )
    
    
    (1,960,833
    )
    
    
    85,862,244Total shares
    
    
    369,273,371
    
    
    
    (5,458,097
    )
    
    
    (16,781,995
    )
    
    
    (7,092,347
    )
    
    
    339,940,931Shares in the form of CPOs
(5)
    
    
    307,989,072
    
    
    
    (5,458,097
    )
    
    
    (8,951,772
    )
    
    
    (6,554,784
    )
    
    
    287,024,418CPOs (5)
    
    
    2,632,385
    
    
    
    (46,650
    )
    
    
    (76,511
    )
    
    
    (56,024
    )
    
    
    2,453,200
 
 (1)
    
    In April 2004, the Companys stockholders approved a restructuring of the Companys capital
stock (the Recapitalization), which comprised the following: (i) a 25-for-one stock split,
which became effective on July 26, 2004 (all the Companys share and per share data in these
financial statements are presented on a post-split basis); (ii) the creation of the Series B
Shares; (iii) a 14-for-25 stock dividend in the amount of Ps. 968,262 (nominal of Ps. 906,114);
and (iv) an increase in the number of shares represented by each outstanding CPO. The
Recapitalization increased the number of the Companys shares by a factor of 39 on a pre-split
basis but did not affect the Companys total equity or dilute the equity interest of any
shareholder.(2)
    
    In 2003, 2004 and 2005 the Company repurchased 2,370,007, 1,813,102 and 3,645,463 shares,
respectively, in the form of 31,600, 15,497 and 31,158 CPOs, respectively, in the amount of
Ps. 579,821, Ps. 403,107 and Ps. 1,065,165, respectively, in connection with a three-year share
repurchase program of up to U.S.$400.0 million, exercised at the discretion of management and
subject to legal, market and other conditions. In April and December 2003, the Companys
stockholders approved the cancellation of 2,370,068 shares of capital stock in the form of
31,601 CPOs, which were primarily repurchased under this program. In 2004, the Company resold
468 shares in the form of 4 CPOs, repurchased under this program, in the amount of Ps. 105. F-26




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##### Table of Contents



(3)
    
    In December 2003, in connection with the approval of the Companys shareholders to issue
additional Series A Shares for the Long-Term Retention Plan described below, the Company
increased its capital stock in the amount of Ps. 4,373,269 by issuing additional 10,757,689
Series A Shares, not in the form of CPOs, of which Ps. 3,967,836 were recognized as
additional paid-in capital. Following this capital stock increase, the 10,757,689 Series A
Shares were acquired by a Companys trust for the purpose of implementing the Companys
Long-Term Retention Plan.(4)
    
    In connection with the Companys Stock Purchase Plan described below.(5)
    
    In the second half of 2004, the Company issued 392,837 additional CPOs by combining 9,820,921
Series A Shares, 8,642,411 Series B Shares, 13,749,290 Series D Shares and 13,749,290
Series L Shares, not in the form of CPOs, which were owned by certain shareholders
(equivalent to 312,880 CPOs), and were acquired by a Companys trust (equivalent to 76,511
CPOs) and a Companys subsidiary (equivalent to 3,446 CPOs). Additionally, in April 2005, the
Company issued 4 additional CPOs by combining 107 Series A Shares, 94 Series B Shares, 150
Series D Shares and 150 Series L Shares, not in the form of CPOs, which were acquired by a
Groups trust for a pension plan.    Stock Purchase Plan
  Long-term Retention Plan
   F-27




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##### Table of Contents



December 31, 2005Dividend yield
    
    3.0%Expected volatility(1)
    
    22.34%Risk-free interest rate
    
    8.2%Expected life of awards (in years)
    
    4.1 years
 
 (1)
    
    Volatility was determined by reference to historically observed prices of the Groups CPO.  Stock Purchase Plan
    
    Long-term Retention PlanWeighted-Average
    
    
    
    
    
    Weighted-AverageCPOs
    
    Exercise Price
    
    CPOs
    
    Exercise PriceGranted
    
    
    120,490
    
    
    
    13.40
    
    
    
    47,823
    
    
    
    13.45Exercised
    
    
    (69,988
    )
    
    
    13.13
    
    
    
    
    
    
    
    Forfeited
    
    
    (2,320
    )
    
    
    13.40
    
    
    
    (1,039
    )
    
    
    13.45Outstanding at end of year
    
    
    48,182
    
    
    
    15.41
    
    
    
    46,784
    
    
    
    13.45Exercisable at end of year
    
    
    4,472
    
    
    
    11.45
    
    
    
    
    
    
    
    
  13. Retained earnings
      F-28




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##### Table of Contents



14. Comprehensive income
  2003
    
    
    2004
    
    
    2005Net income
    
    Ps.
    3,909,381
    
    
    Ps.
    4,460,607
    
    
    Ps.
    6,125,542Other comprehensive (loss) income, net:Foreign currency translation adjustments, net (1)
    
    
    (166,141
    )
    
    
    (200,651
    )
    
    
    (178,171
    )Result from holding non-monetary assets, net (2)
    
    
    285,104
    
    
    
    (131,764
    )
    
    
    (531,349
    )Gain (loss) on equity accounts of investees (see Note 5)(3)
    
    
    3,133,953
    
    
    
    123,591
    
    
    
    (189,400
    )Total other comprehensive income (loss), net
    
    
    3,252,916
    
    
    
    (208,824
    )
    
    
    (898,920
    )Comprehensive income
    
    Ps.
    7,162,297
    
    
    Ps.
    4,251,783
    
    
    Ps.
    5,226,622
 
 (1)
    
    The amounts for 2003, 2004 and 2005 include the foreign exchange (loss) gain of (Ps. 509,774),
Ps. 44,064 and Ps. 416,856, respectively, which were hedged by the Groups net investment in
Univision (see Notes 1(c) and 17).(2)
    
    Represents the difference between specific costs (net replacement cost or Specific Index) of
non-monetary assets and the restatement of such assets using the NCPI, net of deferred tax
(provision) benefit of (Ps. 162,351), Ps. 56,656 and Ps. 212,665 for the years ended December 31,
2003, 2004 and 2005, respectively.(3)
    
    Represents the gains or losses on the dilution of investments in equity investees and the
recognition of the components of other comprehensive income recorded by the equity investees.  Cumulative
    
    
    CumulativeGain on
    
    
    
    
    
    
    Result from
    
    
    Result from
    
    
    Cumulative
    
    
    AccumulatedIssuance of
    
    
    Accumulated
    
    
    Holding Non-
    
    
    Foreign
    
    
    Effect of
    
    
    OtherShares of
    
    
    Monetary
    
    
    Monetary
    
    
    Currency
    
    
    Deferred
    
    
    ComprehensiveInvestees
    
    
    Result
    
    
    Assets
    
    
    Translation
    
    
    Income Taxes
    
    
    (Loss) IncomeBalance at January 1, 2003
    
    Ps.
    796,771
    
    
    Ps.
    (32,591
    )
    
    Ps.
    (2,024,173
    )
    
    Ps.
    (1,444,979
    )
    
    Ps.
    (2,986,569
    )
    
    Ps.
    (5,691,541
    )Current year change
    
    
    3,133,953
    
    
    
    
    
    
    
    285,104
    
    
    
    (166,141
    )
    
    
    
    
    
    
    3,252,916Balance at December 31, 2003
    
    
    3,930,724
    
    
    
    (32,591
    )
    
    
    (1,739,069
    )
    
    
    (1,611,120
    )
    
    
    (2,986,569
    )
    
    
    (2,438,625
    )Current year change
    
    
    123,591
    
    
    
    
    
    
    
    (131,763
    )
    
    
    (200,652
    )
    
    
    
    
    
    
    (208,824
    )Balance at December 31, 2004
    
    
    4,054,315
    
    
    
    (32,591
    )
    
    
    (1,870,832
    )
    
    
    (1,811,772
    )
    
    
    (2,986,569
    )
    
    
    (2,647,449
    )Current year change
    
    
    (189,400
    )
    
    
    
    
    
    
    (531,349
    )
    
    
    (178,171
    )
    
    
    
    
    
    
    (898,920
    )Balance at December 31, 2005
    
    Ps.
    3,864,915
    
    
    Ps.
    (32,591
    )
    
    Ps.
    (2,402,181
    )
    
    Ps.
    (1,989,943
    )
    
    Ps.
    (2,986,569
    )
    
    Ps.
    (3,546,369
    )
  F-29




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##### Table of Contents



15. Minority interest
  2004
    
    
    2005Capital stock
    
    Ps.
    3,791,218
    
    
    Ps.
    3,790,762Retained earnings
    
    
    (3,849,687
    )
    
    
    (3,662,595
    )Cumulative result from holding non-monetary assets
    
    
    (248,055
    )
    
    
    (305,124
    )Accumulated monetary result
    
    
    (6,999
    )
    
    
    (850
    )Cumulative effect of deferred income taxes
    
    
    (50,514
    )
    
    
    (55,342
    )Net income for the year
    
    
    239,475
    
    
    
    1,084,021Ps.
    (124,562
    )
    
    Ps.
    850,872
 16. Transactions with related parties
  2003
    
    
    2004
    
    
    2005Revenues:Royalties (Univision) (a)
    
    Ps.
    1,163,210
    
    
    Ps.
    1,135,025
    
    
    Ps.
    1,107,178Soccer transmission rights (Univision)
    
    
    45,607
    
    
    
    73,582
    
    
    
    91,647Programming production and transmission rights (b)
    
    
    334,557
    
    
    
    226,249
    
    
    
    93,202Administrative services (c)
    
    
    75,618
    
    
    
    53,626
    
    
    
    73,738Interest income
    
    
    136,909
    
    
    
    926
    
    
    
    1,245Advertising (d)
    
    
    225,534
    
    
    
    112,000
    
    
    
    32,396Ps.
    1,981,435
    
    
    Ps.
    1,601,408
    
    
    Ps.
    1,399,406Costs:Donations
    
    Ps.
    75,513
    
    
    Ps.
    95,290
    
    
    Ps.
    106,171Administrative services (c)
    
    
    40,583
    
    
    
    5,635
    
    
    
    26,607Other
    
    
    61,710
    
    
    
    77,116
    
    
    
    233,304Ps.
    177,806
    
    
    Ps.
    178,041
    
    
    Ps.
    366,082
 
 (a)
    
    The Group receives royalties from Univision for programming provided pursuant to a program
license agreement that expires in December 2017. Royalties are determined based upon a
percentage of combined net sales of Univision, which was 9% plus an incremental percentage of
up to 3% over additional sales in 2003, 2004 and 2005.(b)
    
    Services rendered to Innova and other affiliates in 2003, Innova for the three months ended
March 31, 2004, and Endemol and other affiliates in 2004 and 2005.(c)
    
    The Group receives revenue from and is charged by affiliates for various services, such as
equipment rental, security and other services, at rates which are negotiated. The Group
provides management services to affiliates, which reimburse the Group for the incurred payroll
and related expenses.(d)
    
    Advertising services rendered to Innova in 2003 and for the three months ended March 31,
2004, and to OCEN and Univision in 2003, 2004 and 2005.Other transactions with related parties carried out by the Group in the normal course of
business include the following:(a)
    
    A consulting firm owned by a relative of one of the Groups directors, which has, from time
to time, provided consulting services and research in connection with the effects of the
Groups programming on its viewing audience.(b)
    
    From time to time, a Mexican bank made loans to the Group, on terms substantially similar to
those offered by the bank to third parties. One of the Groups directors is a member of the
board of this bank and another of the Groups directors is the Chairman of the board of this
bank. Also, other members of the Groups Board serve as board members of this bank.(c)
    
    Two of the Groups directors and one of the Groups alternate directors are members of the
board as well as shareholders of a Mexican company, which is a producer, distributor and
exporter of beer in Mexico. Such company purchases advertising services from the Group in
connection with the promotion of its products from time to time, paying rates applicable to
third-party advertisers for these advertising services. F-30




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##### Table of Contents



(d)
    
    Several other members of the Groups current board serve as members of the boards and/or
shareholders of other companies, some of which purchased advertising services from the Group
in connection with the promotion of their respective products and services.(e)
    
    During 2003, 2004 and 2005, a professional services firm in which a current director and two
alternate directors maintain interest provided legal advisory services to the Group in
connection with various corporate matters. Total fees for such services amounted to Ps. 8,774,
Ps. 19,184 and Ps. 17,717, respectively.  2004
    
    
    2005DIRECTV (payable in connection
with the acquisition of a
subscriber list, see Notes 2 and 7)
    
    Ps.
    
    
    
    Ps.
    (704,868
    )CIE (see Note 2)
    
    
    
    
    
    
    191,277News Corp. (see Note 2)
    
    
    (59,198
    )
    
    
    (46,314
    )OCEN (see Notes 2 and 7)
    
    
    (7,527
    )
    
    
    3,642Univision (see Note 5)
    
    
    90,156
    
    
    
    88,976Other
    
    
    55,530
    
    
    
    11,384Ps.
    78,961
    
    
    Ps.
    (455,903
    )
   17. Integral cost of financing
  2003
    
    
    2004
    
    
    2005Interest expense (1)
    
    Ps.
    1,495,413
    
    
    Ps.
    2,165,217
    
    
    Ps.
    2,134,499Interest income
    
    
    (706,409
    )
    
    
    (678,391
    )
    
    
    (932,124
    )Foreign exchange (gain) loss, net (2)
    
    
    (210,170
    )
    
    
    95,179
    
    
    
    727,547Loss (gain) from monetary position (3)
    
    
    89,135
    
    
    
    (15,318
    )
    
    
    (147,892
    )Ps.
    667,969
    
    
    Ps.
    1,566,687
    
    
    Ps.
    1,782,030
 
 (1)
    
    Interest expense in 2003 includes Ps. 151,448, derived from the restatement of the Companys
UDI-denominated debt securities, and in 2004 and 2005 includes Ps. 209,232 and Ps. 38,077,
respectively, derived from the UDI index restatement of Companys UDI-denominated debt
securities and a net gain from related derivative contracts of Ps. 31,387 and Ps. 6,302,
respectively (see Notes 8 and 9).(2)
    
    Net foreign exchange gain in 2003 includes a net loss from foreign currency option contracts
of Ps. 19,375 and net foreign exchange loss in 2004 and 2005 includes a net loss from foreign
currency derivative contracts of Ps. 99,468 and Ps. 712,259, respectively. A foreign exchange
loss in 2003 of Ps. 509,774, and a foreign exchange gain in 2004 and 2005 of Ps. 44,064 and
Ps. 416,856, respectively, were hedged by the Groups net investment in Univision and
recognized in stockholders equity as other comprehensive loss (see Notes 1(c) and 14).(3)
    
    The gain or loss from monetary position represents the effects of inflation, as measured by
the NCPI in the case of Mexican companies, or the general inflation index of each country in
the case of foreign subsidiaries, on the monetary assets and liabilities at the beginning of
each month. It also includes monetary loss in 2003, 2004 and 2005 of Ps. 147,438, Ps. 187,800
and Ps. 133,220, respectively, arising from temporary differences of non-monetary items in
calculating deferred income tax (see Note 20). F-31




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##### Table of Contents



18. Restructuring and non-recurring charges
  2003
    
    
    2004
    
    
    2005Restructuring charges:Severance costs
    
    Ps.
    205,430
    
    
    Ps.
    151,196
    
    
    Ps.
    41,352Non-recurring charges:Payment of vested and non-vested salary benefits (1)
    
    
    308,915
    
    
    
    
    
    
    
    Loss on disposal of nationwide paging business (see Notes 2 and 6)
    
    
    178,889
    
    
    
    
    
    
    
    Impairment adjustments (2)
    
    
    
    
    
    
    237,665
    
    
    
    7,439Expenses of debt placement (3)
    
    
    
    
    
    
    
    
    
    
    181,111Other
    
    
    21,172
    
    
    
    19,562
    
    
    
    Ps.
    714,406
    
    
    Ps.
    408,423
    
    
    Ps.
    229,902
 
 (1)
    
    Benefits paid to certain of the Groups union employees.(2)
    
    During 2004, the Group tested for impairment the carrying value of goodwill and other
intangible assets. As a result of such testing, impairment adjustments were made to goodwill
related primarily to the Groups Publishing Distribution segment and publishing trademarks in
the amount of Ps. 196,225 and Ps. 41,440, respectively. For purposes of the goodwill impairment
test, the fair value of the related reporting unit was estimated using appraised valuations by
experts.(3)
    
    Related with Senior Notes due 2011 and Notes denominated in Mexican Investment Units (UDIs)
due 2007 (see Note 8). 19. Other expense, net
  2003
    
    
    2004
    
    
    2005(Gain) loss on disposition of investments, net (see Note 2)
    
    Ps.
    (482,781
    )
    
    Ps.
    138,284
    
    
    Ps.
    172,286Amortization of goodwill (see Note 1(i))
    
    
    500,755
    
    
    
    
    
    
    
    Provision for doubtful non-trade accounts and write-off of
other receivables
    
    
    11,555
    
    
    
    39,028
    
    
    
    14,925Write-off of goodwill (see Note 2) (1)
    
    
    123,847
    
    
    
    
    
    
    
    Donations (see Note 16)
    
    
    175,983
    
    
    
    170,847
    
    
    
    120,048Financial advisory and professional services (2)
    
    
    55,783
    
    
    
    69,145
    
    
    
    72,479Loss on disposition of fixed assets
    
    
    230,976
    
    
    
    68,581
    
    
    
    111,090Other (income) expense, net
    
    
    (25,617
    )
    
    
    46,275
    
    
    
    (26,608
    )Ps.
    590,501
    
    
    Ps.
    532,160
    
    
    Ps.
    464,220
 
 (1)
    
    In 2003, write-offs of unamortized goodwill in the amount of Ps. 123,847, were recognized in
connection with the recoverability evaluation of certain long-lived assets of the Group.(2)
    
    Includes financial advisory services in connection with contemplated dispositions and
strategic planning projects and professional services in connection with certain litigation
and other matters (see Notes 2, 12 and 16). 20. Income tax, asset tax and employees profit sharing
   F-32




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##### Table of Contents



2003
    
    
    2004
    
    
    2005Income tax and asset tax, current
    
    Ps.
    1,136,994
    
    
    Ps.
    578,701
    
    
    Ps.
    1,539,020Income tax and asset tax, deferred
    
    
    (360,946
    )
    
    
    630,108
    
    
    
    (787,777
    )Ps.
    776,048
    
    
    Ps.
    1,208,809
    
    
    Ps.
    751,243
  %2003
    
    2004
    
    2005Tax at the statutory rate on income before provisions
    
    
    34
    
    
    
    33
    
    
    
    30Differences in inflation adjustments for tax and book purposes
    
    
    2
    
    
    
    2
    
    
    
    1Hedge
    
    
    (3
    )
    
    
    
    
    
    
    1Non-deductible items
    
    
    4
    
    
    
    3
    
    
    
    Special tax consolidation items
    
    
    (1
    )
    
    
    
    
    
    
    (2
    )Unconsolidated income tax
    
    
    6
    
    
    
    2
    
    
    
    Minority interest
    
    
    11
    
    
    
    (4
    )
    
    
    (2
    )Excess in tax provision of prior years
    
    
    4
    
    
    
    (2
    )
    
    
    (1
    )Changes in valuation allowances:Asset tax
    
    
    6
    
    
    
    4
    
    
    
    Tax loss carryforwards
    
    
    
    
    
    
    5
    
    
    
    (1
    )Effect of change in income tax rates
    
    
    4
    
    
    
    
    
    
    
    Foreign operations
    
    
    (18
    )
    
    
    (9
    )
    
    
    (5
    )Recoverable income tax from repurchase of shares
    
    
    
    
    
    
    (5
    )
    
    
    Use of unconsolidated tax losses (a)
    
    
    (32
    )
    
    
    (10
    )
    
    
    (12
    )Provision for income tax and the asset tax
    
    
    17
    
    
    
    19
    
    
    
    9
 
 (a)
    
    In 2003 and 2004, this amount represents the effect of the use of tax loss carryforwards
arising from the acquisition of Telespecialidades in June 2003, and certain other subsidiaries
in the second half of 2004. In 2005, this amount represents the effect of the use of tax
losses in connection with the acquisition of Comtelvi (see Note 2).  Amount
    
    
    ExpirationOperating tax loss carryforwards:Unconsolidated:Mexican subsidiaries (1)
    
    Ps.
    3,762,178
    
    
    From 2006 to 2015Non-Mexican subsidiaries (2)
    
    
    936,277
    
    
    From 2006 to 20244,698,455Capital tax loss carryforwards:Unconsolidated Mexican subsidiary (3)
    
    
    388,320
    
    
    From 2009 to 2015Ps.
    5,086,775
 
 (1)
    
    During 2003, 2004 and 2005, certain Mexican subsidiaries utilized unconsolidated operating
tax loss carryforwards of Ps. 6,973,809, Ps. 2,186,619 and Ps. 447,651, respectively. In 2005,
that amount includes the operating tax loss carryforwards related to the minority interest of
Sky Mexico.(2)
    
    Approximately the equivalent of U.S.$88.1 million for subsidiaries in Spain, South America
and the United States.(3)
    
    These carryforwards can only be used in connection with capital gains to be generated by such
subsidiary.  F-33




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##### Table of Contents



2004
    
    
    2005Assets:Accrued liabilities
    
    Ps.
    784,965
    
    
    Ps.
    806,837Goodwill
    
    
    881,452
    
    
    
    801,307Tax loss carryforwards
    
    
    1,573,582
    
    
    
    1,245,149Allowance for doubtful accounts
    
    
    428,037
    
    
    
    412,697Customer advances
    
    
    1,604,641
    
    
    
    1,378,988Other items
    
    
    324,868
    
    
    
    221,434Liabilities:Inventories
    
    
    (756,675
    )
    
    
    (216,332
    )Property, plant and equipment, net
    
    
    (1,178,787
    )
    
    
    (999,494
    )Prepaid expenses
    
    
    (1,650,498
    )
    
    
    (1,299,000
    )Innova
    
    
    (1,620,793
    )
    
    
    (1,322,182
    )Deferred income taxes of Mexican companies
    
    
    390,792
    
    
    
    1,029,404Deferred income taxes of foreign subsidiaries
    
    
    54,586
    
    
    
    (56,313
    )Asset tax
    
    
    1,475,108
    
    
    
    1,384,233Valuation allowances (a)
    
    
    (3,527,175
    )
    
    
    (2,555,530
    )Deferred income tax liability
    
    
    (1,606,689
    )
    
    
    (198,206
    )Effect of change of income tax rates
    
    
    189,534
    
    
    
    32,549Deferred income tax liability, net
    
    Ps.
    (1,417,155
    )
    
    Ps.
    (165,657
    )
 
 (a)
    
    Reflects valuation allowances of foreign subsidiaries of Ps. 366,171 and Ps. 280,883 at
December 31, 2004 and 2005, respectively.  Tax LossCarryforwards
    
    
    Asset Tax
    
    
    Goodwill
    
    
    TotalBalance at beginning of year
    
    Ps.
    (1,939,753
    )
    
    Ps.
    (705,970
    )
    
    Ps.
    (881,452
    )
    
    Ps.
    (3,527,175
    )Increases
    
    
    
    
    
    
    (72,173
    )
    
    
    
    
    
    
    (72,173
    )Decreases
    
    
    963,673
    
    
    
    
    
    
    
    80,145
    
    
    
    1,043,818Balance at end of year
    
    Ps.
    (976,080
    )
    
    Ps.
    (778,143
    )
    
    Ps.
    (801,307
    )
    
    Ps.
    (2,555,530
    )
  Charge to the gain from monetary position (1)
    
    Ps.
    (87,509
    )Credit to the result from holding non-monetary assets
    
    
    212,665Credit to the provision for deferred income tax
    
    
    787,777Credit to the cumulative effect of accounting changes
    
    
    75,721Acquisition of companies (see Note 2)
    
    
    262,844Ps.
    1,251,498
 
 (1)
    
    Net of Ps. 133,220, representing the effect on restatement of the non-monetary items included
in the deferred tax calculation.  F-34




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##### Table of Contents



21. Earnings per CPO/Share
  2003
    
    2004
    
    2005Total Shares
    
    
    352,421,221
    
    
    
    345,205,994
    
    
    
    341,158,189CPOs
    
    
    2,166,320
    
    
    
    2,293,867
    
    
    
    2,463,608Shares not in the form of CPO units:Series A Shares
    
    
    57,387,552
    
    
    
    55,524,135
    
    
    
    52,915,759Series B Shares
    
    
    8,214,835
    
    
    
    5,305,998
    
    
    
    108Series D Shares
    
    
    11,255,911
    
    
    
    6,645,321
    
    
    
    113Series L Shares
    
    
    11,255,911
    
    
    
    6,645,321
    
    
    
    113
  2003
    
    
    2004
    
    
    2005Per EachSeries A,B, DPer Series
    
    
    
    
    
    
    Per Series
    
    
    
    
    
    
    and LPer CPO
    
    
    A Share
    
    
    Per CPO
    
    
    A Share
    
    
    Per CPO
    
    
    ShareContinuing operations
    
    Ps.
    1.38
    
    
    Ps.
    0.01
    
    
    Ps.
    1.89
    
    
    Ps.
    0.02
    
    
    Ps.
    2.28
    
    
    Ps.
    0.02Discontinued operations
    
    
    (0.02
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cumulative loss effect of accounting changes
    
    
    
    
    
    
    
    
    
    
    (0.36
    )
    
    
    
    
    
    
    (0.17
    )
    
    
    Net income
    
    Ps.
    1.36
    
    
    Ps.
    0.01
    
    
    Ps.
    1.53
    
    
    Ps.
    0.02
    
    
    Ps.
    2.11
    
    
    Ps.
    0.02
 22. Foreign currency position
  Foreign CurrencyAmounts
    
    Year-End(Thousands)
    
    Exchange Rate
    
    Mexican PesosAssets:U.S. dollars
    
    
    650,314
    
    
    Ps.
    10.6265
    
    
    Ps.
    6,910,562Euros
    
    
    98,855
    
    
    
    12.5864
    
    
    
    1,244,232Chilean pesos
    
    
    8,230,648
    
    
    
    0.0207
    
    
    
    170,374Other currencies
    
    
    
    
    
    
    
    
    
    
    181,738Liabilities:U.S. dollars (1)
    
    
    1,589,904
    
    
    Ps.
    10.6265
    
    
    Ps.
    16,895,115Chilean pesos
    
    
    9,436,425
    
    
    
    0.0207
    
    
    
    195,334Other currencies
    
    
    
    
    
    
    
    
    
    
    158,698
 
 (1)
    
    Includes U.S.$775.5 million (Ps. 8,240,681) of long-term securities being hedged by the
Groups net investment in Univision (see Note 1(c)). F-35




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##### Table of Contents



Foreign CurrencyAmounts
    
    Year-End(Thousands)
    
    Exchange Rate
    
    Mexican Pesos(1)Property, plant and equipment:U.S. dollars
    
    
    315,036
    
    
    Ps.
    10.6265
    
    
    Ps.
    3,347,728Japanese yen
    
    
    3,970,094
    
    
    
    0.0910
    
    
    
    361,279Euros
    
    
    14,949
    
    
    
    12.5864
    
    
    
    188,153Other currencies
    
    
    
    
    
    
    
    
    
    
    141,361Transmission rights and programming:U.S. dollars
    
    
    382,054
    
    
    Ps.
    10.6265
    
    
    Ps.
    4,059,893Other currencies
    
    
    
    
    
    
    
    
    
    
    133,638
 
 (1)
    
    Amounts translated at the year-end exchange rates for reference purposes only; does not
indicate the actual amounts accounted for in the financial statements.  U.S. DollarEquivalent ofother ForeignCurrency
    
    
    Total U.S.U.S. Dollar
    
    
    Transactions
    
    
    Dollar(Thousands)
    
    
    (Thousands)
    
    
    (Thousands)
    
    
    Mexican Pesos(1)Income:Revenues
    
    $
    340,192
    
    
    $
    44,923
    
    
    $
    385,115
    
    
    Ps.
    4,092,424Other income
    
    
    4,384
    
    
    
    886
    
    
    
    5,270
    
    
    
    56,002Interest income
    
    
    17,095
    
    
    
    164
    
    
    
    17,259
    
    
    
    183,403$
    361,671
    
    
    $
    45,973
    
    
    $
    407,644
    
    
    Ps.
    4,331,829Purchases, costs and expenses:Purchases of inventories
    
    $
    215,433
    
    
    $
    13,219
    
    
    $
    228,652
    
    
    Ps.
    2,429,770Purchases of property and equipment
    
    
    85,020
    
    
    
    2,346
    
    
    
    87,366
    
    
    
    928,395Investments
    
    
    64,847
    
    
    
    1,631
    
    
    
    66,478
    
    
    
    706,429Costs and expenses
    
    
    303,263
    
    
    
    43,516
    
    
    
    346,779
    
    
    
    3,685,047Interest expense
    
    
    123,424
    
    
    
    222
    
    
    
    123,646
    
    
    
    1,313,924$
    791,987
    
    
    $
    60,934
    
    
    $
    852,921
    
    
    Ps.
    9,063,565
 
 (1)
    
    Income statement amounts translated at the year-end exchange rate of Ps. 10.6265 for reference
purposes only; does not indicate the actual amounts accounted for in the financial statements
(see Note 1(c)).   23. Segment data
   Television Broadcasting
  F-36




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##### Table of Contents



Pay Television Networks
  Programming Exports
  Publishing
  Publishing Distribution
  Sky Mexico
  Cable Television
  Radio
  Other Businesses
  F-37




---



##### Table of Contents



OperatingIncome (Loss)Before
    
    
    DepreciationDepreciation
    
    
    andTotal
    
    
    Intersegment
    
    
    Consolidated
    
    
    and
    
    
    Amortization
    
    
    OperatingRevenues
    
    
    Revenues
    
    
    Revenues
    
    
    Amortization
    
    
    Expense
    
    
    Income (Loss)2003:Television Broadcasting
    
    Ps.
    16,725,131
    
    
    Ps.
    76,209
    
    
    Ps.
    16,648,922
    
    
    Ps.
    7,108,984
    
    
    Ps.
    1,003,430
    
    
    Ps.
    6,105,554Pay Television Networks
    
    
    760,525
    
    
    
    60,736
    
    
    
    699,789
    
    
    
    167,736
    
    
    
    43,058
    
    
    
    124,678Programming Exports
    
    
    1,771,921
    
    
    
    
    
    
    
    1,771,921
    
    
    
    541,339
    
    
    
    8,049
    
    
    
    533,290Publishing
    
    
    1,943,225
    
    
    
    1,757
    
    
    
    1,941,468
    
    
    
    376,233
    
    
    
    20,536
    
    
    
    355,697Publishing Distribution
    
    
    1,930,693
    
    
    
    7,192
    
    
    
    1,923,501
    
    
    
    9,396
    
    
    
    22,028
    
    
    
    (12,632
    )Cable Television
    
    
    1,072,299
    
    
    
    5,296
    
    
    
    1,067,003
    
    
    
    327,636
    
    
    
    196,207
    
    
    
    131,429Radio
    
    
    270,987
    
    
    
    51,173
    
    
    
    219,814
    
    
    
    24,441
    
    
    
    16,888
    
    
    
    7,553Other Businesses
    
    
    1,479,661
    
    
    
    139,693
    
    
    
    1,339,968
    
    
    
    (163,870
    )
    
    
    347,686
    
    
    
    (511,556
    )Eliminations and corporate expenses
    
    
    (342,056
    )
    
    
    (342,056
    )
    
    
    
    
    
    
    (162,291
    )
    
    
    
    
    
    
    (162,291
    )Consolidated total
    
    Ps.
    25,612,386
    
    
    Ps.
    
    
    
    Ps.
    25,612,386
    
    
    Ps.
    8,229,604
    
    
    Ps.
    1,657,882
    
    
    Ps.
    6,571,7222004:Television Broadcasting
    
    Ps.
    17,671,898
    
    
    Ps.
    423,566
    
    
    Ps.
    17,248,332
    
    
    Ps.
    8,018,817
    
    
    Ps.
    1,073,742
    
    
    Ps.
    6,945,075Pay Television Networks
    
    
    827,472
    
    
    
    115,878
    
    
    
    711,594
    
    
    
    308,471
    
    
    
    21,472
    
    
    
    286,999Programming Exports
    
    
    1,981,205
    
    
    
    
    
    
    
    1,981,205
    
    
    
    756,110
    
    
    
    7,434
    
    
    
    748,676Publishing
    
    
    2,163,131
    
    
    
    5,145
    
    
    
    2,157,986
    
    
    
    438,888
    
    
    
    24,289
    
    
    
    414,599Publishing Distribution
    
    
    1,626,435
    
    
    
    8,392
    
    
    
    1,618,043
    
    
    
    (26,227
    )
    
    
    23,725
    
    
    
    (49,952
    )Sky Mexico
    
    
    3,758,154
    
    
    
    44,427
    
    
    
    3,713,727
    
    
    
    1,383,190
    
    
    
    585,782
    
    
    
    797,408Cable Television
    
    
    1,165,514
    
    
    
    3,641
    
    
    
    1,161,873
    
    
    
    368,434
    
    
    
    291,643
    
    
    
    76,791Radio
    
    
    305,623
    
    
    
    50,998
    
    
    
    254,625
    
    
    
    32,804
    
    
    
    19,533
    
    
    
    13,271Other Businesses
    
    
    1,547,428
    
    
    
    103,604
    
    
    
    1,443,824
    
    
    
    (132,113
    )
    
    
    96,538
    
    
    
    (228,651
    )Eliminations and corporate expenses
    
    
    (755,651
    )
    
    
    (755,651
    )
    
    
    
    
    
    
    (161,173
    )
    
    
    
    
    
    
    (161,173
    )Consolidated total
    
    Ps.
    30,291,209
    
    
    Ps.
    
    
    
    Ps.
    30,291,209
    
    
    Ps.
    10,987,201
    
    
    Ps.
    2,144,158
    
    
    Ps.
    8,843,0432005:Television Broadcasting
    
    Ps.
    18,570,795
    
    
    Ps.
    548,423
    
    
    Ps.
    18,022,372
    
    
    Ps.
    8,852,616
    
    
    Ps.
    1,017,747
    
    
    Ps.
    7,834,869Pay Television Networks
    
    
    1,111,176
    
    
    
    293,042
    
    
    
    818,134
    
    
    
    518,074
    
    
    
    25,914
    
    
    
    492,160Programming Exports
    
    
    1,875,916
    
    
    
    
    
    
    
    1,875,916
    
    
    
    668,682
    
    
    
    4,520
    
    
    
    664,162Publishing
    
    
    2,505,499
    
    
    
    38,571
    
    
    
    2,466,928
    
    
    
    480,067
    
    
    
    26,069
    
    
    
    453,998Publishing Distribution
    
    
    402,193
    
    
    
    10,223
    
    
    
    391,970
    
    
    
    6,601
    
    
    
    21,760
    
    
    
    (15,159
    )Sky Mexico
    
    
    5,986,527
    
    
    
    31,945
    
    
    
    5,954,582
    
    
    
    2,516,798
    
    
    
    945,011
    
    
    
    1,571,787Cable Television
    
    
    1,405,145
    
    
    
    2,884
    
    
    
    1,402,261
    
    
    
    489,560
    
    
    
    313,994
    
    
    
    175,566Radio
    
    
    344,733
    
    
    
    51,245
    
    
    
    293,488
    
    
    
    52,200
    
    
    
    19,441
    
    
    
    32,759Other Businesses
    
    
    1,324,209
    
    
    
    68,819
    
    
    
    1,255,390
    
    
    
    (180,371
    )
    
    
    44,513
    
    
    
    (224,884
    )Eliminations and corporate expenses
    
    
    (1,045,152
    )
    
    
    (1,045,152
    )
    
    
    
    
    
    
    (182,471
    )
    
    
    
    
    
    
    (182,471
    )Consolidated total
    
    Ps.
    32,481,041
    
    
    Ps.
    
    
    
    Ps.
    32,481,041
    
    
    Ps.
    13,221,756
    
    
    Ps.
    2,418,969
    
    
    Ps.
    10,802,787
 Accounting policies
  Intersegment revenue
   Allocation of general and administrative expenses
  F-38




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##### Table of Contents



Segment
    
    
    Additions toSegment Assets
    
    
    Liabilities at
    
    
    Property, Plantat Year-End
    
    
    Year-End
    
    
    and Equipment2003:Continuing operations:Television operations (1)
    
    Ps.
    45,846,708
    
    
    Ps.
    20,794,230
    
    
    Ps.
    816,278Publishing
    
    
    2,020,936
    
    
    
    395,798
    
    
    
    11,550Publishing Distribution
    
    
    1,053,855
    
    
    
    429,303
    
    
    
    23,021Cable Television
    
    
    2,299,789
    
    
    
    527,424
    
    
    
    191,588Radio
    
    
    460,354
    
    
    
    55,445
    
    
    
    15,271Other Businesses
    
    
    3,611,691
    
    
    
    2,056,900
    
    
    
    86,020Total
    
    Ps.
    55,293,333
    
    
    Ps.
    24,259,100
    
    
    Ps.
    1,143,7282004:Continuing operations:Television operations (1)
    
    Ps.
    47,875,058
    
    
    Ps.
    21,314,279
    
    
    Ps.
    863,261Publishing
    
    
    2,052,906
    
    
    
    298,379
    
    
    
    55,069Publishing Distribution
    
    
    1,035,995
    
    
    
    380,682
    
    
    
    34,597Sky México
    
    
    4,676,557
    
    
    
    7,487,229
    
    
    
    677,515Cable Television
    
    
    2,091,915
    
    
    
    335,503
    
    
    
    413,778Radio
    
    
    470,918
    
    
    
    56,473
    
    
    
    9,244Other Businesses
    
    
    3,426,748
    
    
    
    574,176
    
    
    
    41,068Total
    
    Ps.
    61,630,097
    
    
    Ps.
    30,446,721
    
    
    Ps.
    2,094,5322005:Continuing operations:Television operations (1)
    
    Ps.
    46,279,220
    
    
    Ps.
    22,193,129
    
    
    Ps.
    875,176Publishing
    
    
    2,063,554
    
    
    
    347,080
    
    
    
    10,576Publishing Distribution
    
    
    916,661
    
    
    
    426,295
    
    
    
    5,790Sky México
    
    
    4,553,301
    
    
    
    5,976,590
    
    
    
    1,187,381Cable Television
    
    
    2,333,206
    
    
    
    469,382
    
    
    
    556,656Radio
    
    
    513,739
    
    
    
    69,654
    
    
    
    13,323Other Businesses
    
    
    3,404,529
    
    
    
    259,394
    
    
    
    89,193Total
    
    Ps.
    60,064,210
    
    
    Ps.
    29,741,524
    
    
    Ps.
    2,738,095
 
 (1)
    
    Segment assets and liabilities information is not maintained by the Group for each of the
Television Broadcasting, Pay Television Networks and Programming Exports segments. In
managements opinion, there is no reasonable or practical basis to make allocations due to the
interdependence of these segments. Consequently, management has presented such information on
a combined basis as television operations.  2003
    
    
    2004
    
    
    2005Segment assets
    
    Ps.
    55,293,333
    
    
    Ps.
    61,630,097
    
    
    Ps.
    60,064,210Investments attributable to:Television operations (1)
    
    
    11,930,754
    
    
    
    11,884,922
    
    
    
    12,235,964Other segments
    
    
    590,677
    
    
    
    700,458
    
    
    
    850,858DTH ventures (2)
    
    
    381,475
    
    
    
    155,343
    
    
    
    Goodwill  net attributable to:Television operations
    
    
    1,279,743
    
    
    
    1,279,745
    
    
    
    1,300,316Publishing distribution
    
    
    182,493
    
    
    
    
    
    
    
    23,670Other segments
    
    
    732,549
    
    
    
    734,086
    
    
    
    376,719Total assets
    
    Ps.
    70,391,024
    
    
    Ps.
    76,384,651
    
    
    Ps.
    74,851,737
 
 (1)
    
    Includes goodwill attributable to equity investments of Ps. 5,921,053, Ps. 5,757,787 and
Ps. 5,499,313 in 2003, 2004 and 2005, respectively.(2)
    
    Includes goodwill attributable to investments in DTH ventures of Ps. 110,299 in 2003. F-39




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##### Table of Contents



2003
    
    
    2004
    
    
    2005Segment liabilities
    
    Ps.
    24,259,100
    
    
    Ps.
    30,446,721
    
    
    Ps.
    29,741,524Notes payable and long-term debt not attributable to segments
    
    
    16,211,771
    
    
    
    17,413,942
    
    
    
    15,246,289Total liabilities
    
    Ps.
    40,470,871
    
    
    Ps.
    47,860,663
    
    
    Ps.
    44,987,813
 Geographical segment information
 Additions toSegment Assets
    
    
    Property, PlantTotal Net Sales
    
    
    at Year-End
    
    
    and Equipment2003:Mexico
    
    Ps.
    21,153,701
    
    
    Ps.
    51,464,962
    
    
    Ps.
    1,093,026Other countries
    
    
    4,458,685
    
    
    
    3,828,371
    
    
    
    50,702Ps.
    25,612,386
    
    
    Ps.
    55,293,333
    
    
    Ps.
    1,143,7282004:Mexico
    
    Ps.
    25,629,888
    
    
    Ps.
    53,353,431
    
    
    Ps.
    2,035,245Other countries
    
    
    4,661,321
    
    
    
    8,276,666
    
    
    
    59,287Ps.
    30,291,209
    
    
    Ps.
    61,630,097
    
    
    Ps.
    2,094,5322005:Mexico
    
    Ps.
    28,717,614
    
    
    Ps.
    53,664,187
    
    
    Ps.
    2,708,402Other countries
    
    
    3,763,427
    
    
    
    6,400,023
    
    
    
    29,693Ps.
    32,481,041
    
    
    Ps.
    60,064,210
    
    
    Ps.
    2,738,095
  F-40




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##### Table of Contents



24. Differences between Mexican and U.S. GAAP
   Reconciliation of net (loss) income
 2003
    
    
    2004
    
    
    2005Net income as reported under Mexican GAAP
    
    Ps.
    3,909,381
    
    
    Ps.
    4,460,607
    
    
    Ps.
    6,125,542U.S. GAAP adjustments:(a) Capitalization of financing costs, net of depreciation
    
    
    21,477
    
    
    
    24,650
    
    
    
    9,391(b) Deferred costs, net of amortization
    
    
    222,916
    
    
    
    37,488
    
    
    
    (3,735
    )(c) Deferred debt refinancing costs, net of amortization
    
    
    
    
    
    
    
    
    
    
    (560,043
    )(d) Equipment restatement, net of depreciation
    
    
    70,188
    
    
    
    72,141
    
    
    
    (480,636
    )(e) Purchase accounting adjustments:Amortization of broadcast license and network
affiliation agreements
    
    
    (6,631
    )
    
    
    (6,631
    )
    
    
    (6,631
    )Depreciation of fixed assets
    
    
    (11,224
    )
    
    
    (11,224
    )
    
    
    (11,224
    )Amortization of other assets
    
    
    (4,526
    )
    
    
    (4,422
    )
    
    
    (4,663
    )(f) Goodwill and other intangible assets:Reversal of Mexican GAAP goodwill amortization
    
    
    500,755
    
    
    
    
    
    
    
    Reversal of Mexican GAAP impairment of goodwill
    
    
    96,528
    
    
    
    178,534
    
    
    
    (g) Equity method investees:Innova
    
    
    (322,713
    )
    
    
    1,346,611
    
    
    
    SMCP
    
    
    (829,441
    )
    
    
    (469,725
    )
    
    
    1,304,636Univision
    
    
    42,300
    
    
    
    
    
    
    
    (i) Derivative financial instruments
    
    
    1,446,031
    
    
    
    (1,054,382
    )
    
    
    (200,251
    )(j) Pension plan and seniority premiums
    
    
    (404
    )
    
    
    23,723
    
    
    
    33,545(k) Employee stock based compensation
    
    
    (300,296
    )
    
    
    (318,424
    )
    
    
    43,678(l) Production and film costs
    
    
    705,288
    
    
    
    (68,289
    )
    
    
    305,753(m) Deferred income taxes and employee profit sharing:Deferred income taxes(1)
    
    
    (2,364,812
    )
    
    
    338,684
    
    
    
    249,048Deferred employees profit sharing (1)
    
    
    87,192
    
    
    
    (68,719
    )
    
    
    71,308(n) Maintenance reserve
    
    
    
    
    
    
    1,497
    
    
    
    4,950(o) Minority interest on U.S. GAAP adjustments
    
    
    (879
    )
    
    
    (26,605
    )
    
    
    (10,410
    )(p) Effects of inflation accounting on U.S. GAAP
adjustments
    
    
    (21,575
    )
    
    
    (105,989
    )
    
    
    (45,565
    )Net income under U.S. GAAP
    
    Ps.
    3,239,555
    
    
    Ps.
    4,349,525
    
    
    Ps.
    6,824,693
 
 (1)  Net of inflation effects F-41




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##### Table of Contents



Reconciliation of stockholders equity
 2004
    
    
    2005Total stockholders equity under Mexican GAAP
    
    Ps.
    28,523,988
    
    
    Ps.
    29,863,924U.S. GAAP adjustments:(a) Capitalization of financing costs, net of accumulated depreciation
    
    
    (859,266
    )
    
    
    (849,875
    )(b) Deferred costs, net of amortization
    
    
    (119,119
    )
    
    
    (122,854
    )(c) Deferred debt refinancing costs, net of amortization
    
    
    
    
    
    
    (560,043
    )(d) Equipment restatement, net of depreciation
    
    
    441,529
    
    
    
    367,186(e) Purchase accounting adjustments:Broadcast license and network affiliation agreements
    
    
    134,828
    
    
    
    128,197Fixed assets
    
    
    72,951
    
    
    
    61,727Other assets
    
    
    50,854
    
    
    
    48,966Goodwill on acquisition of Bay City
    
    
    (1,023,339
    )
    
    
    (1,023,339
    )Goodwill on acquisition of minority interest in Editorial Televisa
    
    
    1,258,217
    
    
    
    1,258,217Goodwill on acquisition of additional interests in Univision
    
    
    (609,327
    )
    
    
    (609,327
    )(f) Goodwill and other intangible assets:Reversal of Mexican GAAP goodwill amortization
    
    
    745,766
    
    
    
    745,766Reversal of Mexican GAAP amortization of intangible assets with
indefinite lives
    
    
    101,874
    
    
    
    101,874(g) Equity method investees:SMCP
    
    
    (1,304,636
    )
    
    
    Univision
    
    
    109,065
    
    
    
    109,065Others
    
    
    (2,265
    )
    
    
    (2,265
    )(h) Adjustment to gain on sale of music recording business
    
    
    (300,112
    )
    
    
    (300,112
    )(i) Derivative financial instruments
    
    
    1,540,490
    
    
    
    1,294,674(j) Pension plan and seniority premiums
    
    
    23,723
    
    
    
    57,268(l) Production and film costs
    
    
    (1,991,458
    )
    
    
    (1,685,705
    )(m) Deferred income taxes and employees profit sharing:Deferred income taxes
    
    
    301,674
    
    
    
    436,960Deferred employees profit sharing
    
    
    (187,429
    )
    
    
    (116,121
    )(n) Maintenance reserve
    
    
    17,980
    
    
    
    22,930(o) Minority interest
    
    
    91,680
    
    
    
    (894,164
    )Total U.S. GAAP adjustments, net
    
    
    (1,506,320
    )
    
    
    (1,530,975
    )Total stockholders equity under U.S. GAAP
    
    Ps.
    27,017,668
    
    
    Ps.
    28,332,949
  2004
    
    
    2005Changes in U.S. GAAP stockholders equityBalance at January 1,
    
    Ps.
    26,917,228
    
    
    Ps.
    27,017,668Net income for the year
    
    
    4,349,525
    
    
    
    6,824,693Repurchase of capital stock
    
    
    (842,597
    )
    
    
    (1,194,424
    )Dividends
    
    
    (4,114,064
    )
    
    
    (4,305,789
    )Sale of capital stock under long-term retention plans
    
    
    605,726
    
    
    
    314,559Stock based compensation
    
    
    318,424
    
    
    
    279,856Other comprehensive income:Changes in other comprehensive income of equity investees
    
    
    123,591
    
    
    
    (189,400
    )Result from holding non-monetary assets
    
    
    (160,544
    )
    
    
    (238,818
    )Foreign currency translation adjustment
    
    
    (179,621
    )
    
    
    (175,396
    )Balance at December 31,
    
    Ps.
    27,017,668
    
    
    Ps.
    28,332,949
 F-42




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##### Table of Contents



(a) Capitalization of financing costs, net of depreciation
   (b) Deferred costs, net of amortization
   (c) Deferred debt refinancing costs, net of amortization
  F-43




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##### Table of Contents



(d) Equipment restatement, net of depreciation
    (e) Purchase accounting adjustments
      F-44




---



##### Table of Contents



(f) Goodwill and other intangible assets
    2004
    
    
    2005Consolidated subsidiaries:Television Broadcasting
    
    Ps.
    311,706
    
    
    Ps.
    332,272Publishing
    
    
    1,337,874
    
    
    
    1,361,544Other segments
    
    
    45,344
    
    
    
    45,344Equity method investees
    
    
    6,183,860
    
    
    
    5,568,025Ps.
    7,878,784
    
    
    Ps.
    7,307,185
  2004
    
    
    2005Trademarks (1) (2)
    
    Ps.
    530,052
    
    
    Ps.
    471,697Television network concession (1)
    
    
    687,823
    
    
    
    687,823Network affiliation agreements (1)
    
    
    111,067
    
    
    
    111,067Licenses and software
    
    
    289,069
    
    
    
    340,466Subscriber list
    
    
    
    
    
    
    432,798Deferred financing costs
    
    
    165,952
    
    
    
    299,448Broadcast license
    
    
    23,761
    
    
    
    17,130Total intangible assets
    
    Ps.
    1,807,724
    
    
    Ps.
    2,360,429
 
 (1)
    
    Indefinite-lived(2)
    
    Includes translation effect, impairment adjustments and acquisitions (see Note 7)  F-45




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##### Table of Contents



(g) Equity method investees
   Condensed Statement of Operations
 Year ended December 31, 2003OtherEquity
    
    
    Total EquityInnova
    
    
    Univision
    
    
    Investments
    
    
    InvestmentsNet sales
    
    Ps.
    4,071,605
    
    
    Ps.
    15,995,932
    
    
    Ps.
    3,870,340
    
    
    Ps.
    23,937,877Total expenses
    
    
    5,048,367
    
    
    
    12,814,017
    
    
    
    5,165,225
    
    
    
    23,027,609(Loss) income before income taxes and minority interest.
    
    
    (976,762
    )
    
    
    3,181,915
    
    
    
    (1,294,885
    )
    
    
    910,268Income tax benefit (provision)
    
    
    127,230
    
    
    
    (1,285,834
    )
    
    
    (82,131
    )
    
    
    (1,240,735
    )(Loss) income before minority interest
    
    
    (849,532
    )
    
    
    1,896,081
    
    
    
    (1,377,016
    )
    
    
    (330,467
    )Minority interest
    
    
    
    
    
    
    
    
    
    
    (16,613
    )
    
    
    (16,613
    )U.S. GAAP net (loss) income
    
    Ps.
    (849,532
    )
    
    Ps.
    1,896,081
    
    
    Ps.
    (1,393,629
    )
    
    Ps.
    (347,080
    )Televisas equity in net (losses) income of equity
investees,
under U.S. GAAP
    
    Ps.
    (509,720
    )
    
    Ps.
    177,662
    
    
    Ps.
    (747,048
    )
    
    Ps.
    (1,079,106
    )
 Year ended December 31, 2004OtherEquity
    
    
    Total EquityUnivision
    
    
    Investments
    
    
    InvestmentsNet sales
    
    Ps.
    20,586,496
    
    
    Ps.
    5,662,895
    
    
    Ps.
    26,249,391Total expenses
    
    
    15,742,594
    
    
    
    6,014,980
    
    
    
    21,757,574Income (loss) before income taxes and minority interest.
    
    
    4,843,902
    
    
    
    (352,085
    )
    
    
    4,491,817Income tax benefit (provision)
    
    
    (1,895,986
    )
    
    
    (168,237
    )
    
    
    (2,064,223
    )Income (loss) before minority interest
    
    
    2,947,916
    
    
    
    (520,322
    )
    
    
    2,427,594Minority interest
    
    
    
    
    
    
    (3,120
    )
    
    
    (3,120
    )U.S. GAAP net income (loss)
    
    Ps.
    2,947,916
    
    
    Ps.
    (523,442
    )
    
    Ps.
    2,424,474Televisas equity in net income (losses) of equity
investees, under U.S. GAAP
    
    Ps.
    280,403
    
    
    Ps.
    (143,057
    )
    
    Ps.
    137,346Year ended December 31, 2005OtherEquity
    
    
    Total EquityUnivision
    
    
    Investments
    
    
    InvestmentsNet sales
    
    Ps.
    20,748,571
    
    
    Ps.
    3,388,358
    
    
    Ps.
    24,136,929Total expenses
    
    
    16,825,458
    
    
    
    3,573,392
    
    
    
    20,398,850Income (loss) before income taxes and minority interest.
    
    
    3,923,113
    
    
    
    (185,034
    )
    
    
    3,738,079Income tax benefit (provision)
    
    
    (1,934,055
    )
    
    
    (40,029
    )
    
    
    (1,974,084
    )Income (loss) before minority interest
    
    
    1,989,058
    
    
    
    (225,063
    )
    
    
    1,763,995Minority interest
    
    
    
    
    
    
    
    
    
    
    U.S. GAAP net income (loss)
    
    Ps.
    1,989,058
    
    
    Ps.
    (225,063
    )
    
    Ps.
    1,763,995Televisas equity in net income (losses) of equity
investees, under U.S. GAAP (1)
    
    Ps.
    191,855
    
    
    Ps.
    (31,697
    )
    
    Ps.
    160,158
 F-46




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##### Table of Contents



Condensed Balance Sheets
 As of December 31, 2004Other Equity
    
    
    Total EquityUnivision
    
    
    Investments
    
    
    InvestmentsCurrent assets
    
    Ps.
    7,657,534
    
    
    Ps.
    1,558,076
    
    
    Ps.
    9,215,610Non-current assets
    
    
    87,123,587
    
    
    
    1,907,587
    
    
    
    89,031,174Total assets
    
    Ps.
    94,781,121
    
    
    Ps.
    3,465,663
    
    
    Ps.
    98,246,784Current liabilities
    
    
    3,358,417
    
    
    
    5,299,815
    
    
    
    8,658,232Non-current liabilities
    
    
    29,353,322
    
    
    
    964,566
    
    
    
    30,317,888Stockholders (deficit) equity
    
    
    62,069,382
    
    
    
    (2,798,718
    )
    
    
    59,270,664Total liabilities and stockholders equity
    
    Ps.
    94,781,121
    
    
    Ps.
    3,465,663
    
    
    Ps.
    98,246,784Televisas investment in and advances to
equity investees at cost plus equity in
undistributed earnings since acquisition
(net)
    
    Ps.
    6,145,765
    
    
    Ps.
    (565,361
    )
    
    Ps.
    5,580,404
 As of December 31, 2005Other Equity
    
    
    Total EquityUnivision
    
    
    Investments
    
    
    InvestmentsCurrent assets
    
    Ps.
    6,732,950
    
    
    Ps.
    2,471,525
    
    
    Ps.
    9,204,475Non-current assets
    
    
    79,642,812
    
    
    
    1,708,310
    
    
    
    81,351,122Total assets
    
    Ps.
    86,375,762
    
    
    Ps.
    4,179,835
    
    
    Ps.
    90,555,597Current liabilities
    
    
    9,665,025
    
    
    
    1,302,882
    
    
    
    10,967,907Non-current liabilities
    
    
    22,612,288
    
    
    
    276,536
    
    
    
    22,888,824Stockholders (deficit) equity
    
    
    54,098,449
    
    
    
    2,600,417
    
    
    
    56,698,866Total liabilities and stockholders equity
    
    Ps.
    86,375,762
    
    
    Ps.
    4,179,835
    
    
    Ps.
    90,555,597Televisas investment in and advances to
equity investees at cost plus equity in
undistributed earnings since acquisition
(net)
    
    Ps.
    5,767,472
    
    
    Ps.
    837,931
    
    
    Ps.
    6,605,403
 F-47




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##### Table of Contents



Innova
   SMCP
  Univision
  (h) Adjustment to gain on sale of music recording business
  (i) Derivative financial instruments
  F-48




---



##### Table of Contents



(j) Pension plan and seniority premiums
   Components of Net Periodic Benefit Cost
  2003
    
    
    2004
    
    
    2005Service cost
    
    Ps.
    77,520
    
    
    Ps.
    66,427
    
    
    Ps.
    61,959Interest cost
    
    
    40,831
    
    
    
    35,589
    
    
    
    34,147Expected return on plan assets
    
    
    (39,867
    )
    
    
    (46,039
    )
    
    
    (55,575
    )Net amortization and deferral
    
    
    56,058
    
    
    
    7,900
    
    
    
    (14,604
    )Net cost under U.S. GAAP
    
    
    134,542
    
    
    
    63,877
    
    
    
    25,927Net cost under Mexican GAAP
    
    
    134,138
    
    
    
    87,600
    
    
    
    59,472Increase (reduction) of net
cost that would be recognized
under U.S. GAAP
    
    Ps.
    404
    
    
    Ps.
    (23,723
    )
    
    Ps.
    (33,545
    )
 Weighted-average Assumptions Used to Determine Net Periodic Benefit Cost for Years Ended December
31
  2003
    
    2004
    
    2005Weighted average discount rate
    
    
    4
    %
    
    
    4
    %
    
    
    4
    %Rate of increase in future compensation levels
    
    
    2
    %
    
    
    2
    %
    
    
    2
    %Expected long-term rates of return on plan assets
    
    
    5
    %
    
    
    5
    %
    
    
    5
    %
 F-49




---



##### Table of Contents



Obligations and Funded Status At December 31
  2004
    
    
    2005Projected benefit obligation
    
    Ps.
    894,779
    
    
    Ps.
    964,401Plan assets
    
    
    (1,154,693
    )
    
    
    (1,425,944
    )Funded status
    
    
    (259,914
    )
    
    
    (461,543
    )Unrecognized prior service cost
    
    
    (275,316
    )
    
    
    (58,807
    )Unrecognized net loss
    
    
    370,748
    
    
    
    364,20795,432
    
    
    
    305,400Prepaid pension asset
    
    
    (164,482
    )
    
    
    (156,143
    )Severance indemnities  projected benefit obligation
    
    
    
    
    
    
    291,035Balance sheet asset (liability)
    
    Ps.
    (164,482
    )
    
    Ps.
    134,892Change in benefit obligation:Projected benefit obligation at beginning of year
    
    Ps.
    925,974
    
    
    Ps.
    894,779Service cost
    
    
    66,427
    
    
    
    61,959Interest cost
    
    
    35,589
    
    
    
    34,147Actuarial gain
    
    
    (88,021
    )
    
    
    901Benefits paid
    
    
    (45,190
    )
    
    
    (27,385
    )Projected benefit obligation at end of year
    
    Ps.
    894,779
    
    
    Ps.
    964,401
 2003
    
    
    2004Change in plan assets:Fair value of plan assets at beginning of year
    
    Ps.
    966,038
    
    
    Ps.
    1,154,693Actual return on plan assets
    
    
    204,113
    
    
    
    282,910Plan asset contributions
    
    
    72,270
    
    
    
    5,068Benefits paid
    
    
    (87,728
    )
    
    
    (16,727
    )Fair value of plan assets at end of year
    
    Ps.
    1,154,693
    
    
    Ps.
    1,425,944
 Plan Assets
  2004
    
    
    2005Equity securities
    
    
    63.4
    %
    
    
    65.9
    %Fixed rate instruments
    
    
    36.6
    %
    
    
    34.1
    %Total
    
    
    100.0
    %
    
    
    100.0
    %
   F-50




---



##### Table of Contents



(k) Employee stock based compensation
    Year Ended December 31,2003
    
    
    2004Net income under U.S. GAAPAs previously reported
    
    Ps.
    3,048,072
    
    
    Ps.
    3,588,300Add:Adoption of SFAS 123(R) utilizing the
modified retrospective method
    
    
    (300,296
    )
    
    
    (318,424
    )Deduct: Amount previously recorded pursuant to
APB 25
    
    
    491,779
    
    
    
    1,079,649Net income as adjusted
    
    Ps.
    3,239,555
    
    
    Ps.
    4,349,525Earnings per CPO under U.S. GAAP
(constant pesos)Basic and diluted, as previously reported
    
    
    1.04
    
    
    
    1.23Basic and diluted, as adjusted
    
    
    1.12
    
    
    
    1.49Stockholders equity under U.S. GAAPAs previously reported
    
    Ps.
    26,286,326
    
    
    Ps.
    25,307,115Add:Adoption of SFAS 123(R) utilizing the
modified retrospective method
    
    
    
    
    
    
    Deduct: Amount previously recorded pursuant to
APB 25
    
    
    630,902
    
    
    
    1,710,553Stockholders equity as adjusted
    
    Ps.
    26,917,228
    
    
    Ps.
    27,017,668
 F-51




---



##### Table of Contents



December 31,2003
    
    2004
    
    2005Dividend yield
    
    
    3.00
    %
    
    
    3.00
    %
    
    
    3.00
    %Expected volatility
    
    
    33.95
    %
    
    
    28.25
    %
    
    
    28.25
    %Risk-free interest rate
    
    
    8.73
    %
    
    
    8.36
    %
    
    
    8.36
    %Expected life of options (in years)
    
    
    2.3
    
    
    
    3.0
    
    
    
    3.0
   Stock Purchase Plan
 2003
    
    
    2004
    
    
    2005Weighted-
    
    
    
    
    
    
    Weighted-average
    
    
    
    
    
    
    average
    
    
    
    
    
    
    Weighted-exercise
    
    
    
    
    
    
    exercise
    
    
    
    
    
    
    averageCPOs
    
    
    price
    
    
    CPOs
    
    
    price
    
    
    CPOs
    
    
    exercise priceOutstanding at beginning of year
    
    
    82,776
    
    
    Ps.
    12.90
    
    
    
    80,476
    
    
    Ps.
    12.54
    
    
    
    71,262
    
    
    Ps.
    15.18Granted
    
    
    4,416
    
    
    
    12.18
    
    
    
    32,699
    
    
    
    19.74
    
    
    
    599
    
    
    
    13.27Exercised
    
    
    (5,000
    )
    
    
    13.04
    
    
    
    (41,533
    )
    
    
    12.37
    
    
    
    (23,455
    )
    
    
    11.61Canceled/forfeited
    
    
    (1,716
    )
    
    
    
    
    
    
    (380
    )
    
    
    
    
    
    
    (224
    )
    
    
    Outstanding at the end of the year
    
    
    80,476
    
    
    
    12.54
    
    
    
    71,262
    
    
    
    15.18
    
    
    
    48,182
    
    
    
    13.32Options exercisable at end of year
    
    
    25,000
    
    
    
    13.04
    
    
    
    995
    
    
    
    11.31
    
    
    
    4,472
    
    
    
    11.61Weighted average remaining life
    
    
    1.34
    
    
    
    
    
    
    
    1.24
    
    
    
    
    
    
    
    0.8
 Long-Term Retention Plan
 2004
    
    
    2005Weighted-average
    
    
    
    
    
    
    Weighted-exercise
    
    
    
    
    
    
    averageCPOs
    
    
    price
    
    
    CPOs
    
    
    exercise priceOutstanding at beginning of year
    
    
    
    
    
    Ps.
    
    
    
    
    45,109
    
    
    
    13.45Granted
    
    
    45,109
    
    
    
    13.90
    
    
    
    2,715
    
    
    
    13.45Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Canceled/forfeited
    
    
    
    
    
    
    
    
    
    
    (1,039
    )
    
    
    Outstanding at the end of the year
    
    
    45,109
    
    
    
    13.90
    
    
    
    46,785
    
    
    
    13.45Options exercisable at end of year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Weighted average remaining life
    
    
    4.1
    
    
    
    
    
    
    
    3.1
 F-52




---



##### Table of Contents



Stock Purchase Plan
 2003
    
    
    2004
    
    
    2005Weighted-
    
    
    
    
    
    
    Weighted-average
    
    
    
    
    
    
    average
    
    
    
    
    
    
    Weighted-exercise
    
    
    
    
    
    
    exercise
    
    
    
    
    
    
    averageCPOs
    
    
    price
    
    
    CPOs
    
    
    price
    
    
    CPOs
    
    
    exercise priceNonvested at January 1
    
    
    82,776
    
    
    Ps.
    
    
    
    
    55,476
    
    
    Ps.
    
    
    
    
    70,267
    
    
    Ps.
    Granted
    
    
    4,416
    
    
    
    12.18
    
    
    
    32,699
    
    
    
    19.74
    
    
    
    599
    
    
    
    13.42Vested
    
    
    (30,000
    )
    
    
    13.04
    
    
    
    (17,528
    )
    
    
    12.37
    
    
    
    (26,932
    )
    
    
    11.61Forfeited
    
    
    (1,716
    )
    
    
    
    
    
    
    (380
    )
    
    
    
    
    
    
    (224
    )
    
    
    Vested at the end of the year
    
    
    55,476
    
    
    
    13.04
    
    
    
    70,267
    
    
    
    11.31
    
    
    
    43,710
    
    
    
    11.61
 Long-Term Retention Plan
 2004
    
    
    2005Weighted-average
    
    
    
    
    
    
    Weighted-exercise
    
    
    
    
    
    
    averageCPOs
    
    
    price
    
    
    CPOs
    
    
    exercise priceNonvested at January 1
    
    
    
    
    
    Ps.
    
    
    
    
    45,109
    
    
    Ps.
    13.45Granted
    
    
    45,109
    
    
    
    13.90
    
    
    
    2,715
    
    
    
    13.45Vested
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    
    
    
    
    (1,039
    )
    
    
    Vested at the end of the year
    
    
    45,109
    
    
    
    13.90
    
    
    
    46,785
    
    
    
    13.45
 (l) Production and film costs
   F-53




---



##### Table of Contents



(m) Deferred income taxes
    December 31,2004
    
    
    2005Net deferred income tax liability recorded under Mexican
GAAP on Mexican GAAP balances(see Note 20)
    
    Ps.
    (1,417,155
    )
    
    Ps.
    (165,657
    )Reclassification
of non-current taxes
related to non-wholly owned subsidiaries (Innova)
    
    
    1,620,793
    
    
    
    1,322,182Net deferred
income tax amount under SFAS 109 applied to Mexican
GAAP balances
    
    
    203,638
    
    
    
    1,156,525Impact of U.S. GAAP adjustments:Capitalization of financing costs
    
    
    257,780
    
    
    
    237,965Deferred costs
    
    
    35,735
    
    
    
    34,399Equipment restatement
    
    
    (132,459
    )
    
    
    (102,812
    )Purchase accounting adjustments
    
    
    (77,591
    )
    
    
    (66,890
    )Adjustment of gain on sale of music recording business
    
    
    90,034
    
    
    
    84,032Pension plan and seniority premiums
    
    
    (7,117
    )
    
    
    (16,035
    )Derivative financial instruments
    
    
    (462,147
    )
    
    
    (362,509
    )Production and film costs
    
    
    597,439
    
    
    
    471,998Deferred premiums, net of amortization
    
    
    
    
    
    
    156,812301,674
    
    
    
    436,960Net deferred income tax asset on U.S. GAAP
    
    
    505,312
    
    
    
    1,593,485Less:Deferred
income tax amount under SFAS 109 applied to Mexican GAAP balances
    
    
    203,638
    
    
    
    1,156,525Net deferred income tax adjustment required under U.S. GAAP
    
    Ps.
    301,674
    
    
    Ps.
    436,960
  2005Credit to the provision for deferred income tax
    
    Ps.
    726,426Credit to the result from holding non-monetary assets
    
    
    98,903Acquired net operating loss carryforward (1)
    
    
    262,844Ps.
    1,088,173
 
 (1)
    
    Utilized in the same
year F-54




---



##### Table of Contents



December 31,2004
    
    
    2005Deferred EPS liability:Current:Inventories
    
    Ps.
    (906
    )
    
    Ps.
    2,047Noncurrent:Property, plant and equipment
    
    
    (122,479
    )
    
    
    (115,402
    )Deferred costs
    
    
    (59,590
    )
    
    
    (57,514
    )Pension plan and seniority premiums
    
    
    (2,376
    )
    
    
    75,378Other
    
    
    (2,078
    )
    
    
    (20,630
    )Total deferred EPS liability
    
    Ps.
    (187,429
    )
    
    Ps.
    (116,121
    )
  2003
    
    
    2004
    
    
    2005Current:Mexican
    
    Ps.
    1,359,983
    
    
    Ps.
    517,325
    
    
    Ps.
    1,041,207Foreign
    
    
    4,303
    
    
    
    4,192
    
    
    
    199,2021,364,286
    
    
    
    521,517
    
    
    
    1,240,409Deferred:Mexican
    
    
    1,744,770
    
    
    
    27,886
    
    
    
    (728,415
    )Foreign
    
    
    (1,013
    )
    
    
    1,327
    
    
    
    (1,989
    )1,743,757
    
    
    
    29,213
    
    
    
    (726,426
    )Ps.
    3,108,043
    
    
    Ps.
    550,730
    
    
    Ps.
    513,983
  (n) Maintenance reserve
  (o) Minority interest
   F-55




---



##### Table of Contents



(p) Effects of inflation accounting on U.S. GAAP adjustments
   Additional disclosure requirements
 Presentation in the financial statements  Operating income
   F-56




---



##### Table of Contents



Year ended December 31,2003
    
    
    2004
    
    
    2005Net sales
    
    Ps.
    25,612,386
    
    
    Ps.
    30,291,209
    
    
    Ps.
    32,481,041Cost of providing services (exclusive of
depreciation and amortization)
    
    
    13,304,674
    
    
    
    15,372,682
    
    
    
    14,408,148Selling and administrative expenses
    
    
    4,196,748
    
    
    
    4,740,728
    
    
    
    5,057,637Depreciation and amortization
    
    
    1,544,715
    
    
    
    2,076,822
    
    
    
    3,006,572Income from operations
    
    
    6,566,252
    
    
    
    8,100,977
    
    
    
    10,008,684Integral result of financing, net
    
    
    756,487
    
    
    
    (2,634,224
    )
    
    
    (2,636,947
    )Other
(expense) income net
    
    
    (26,732
    )
    
    
    (377,712
    )
    
    
    901,212Income before income taxes, minority
interest and equity in earnings or
losses of affiliates
    
    
    7,296,007
    
    
    
    5,089,041
    
    
    
    8,272,949Income tax and assets tax  current and
deferred
    
    
    (3,108,043
    )
    
    
    (550,730
    )
    
    
    (513,983
    )Income before minority interest and
equity in earnings or losses of
affiliates
    
    
    4,187,964
    
    
    
    4,538,311
    
    
    
    7,758,966Minority interest
    
    
    130,697
    
    
    
    (266,080
    )
    
    
    (1,094,431
    )Equity in (losses) earnings of affiliates
    
    
    (1,079,106
    )
    
    
    137,346
    
    
    
    160,158Net income
    
    Ps.
    3,239,555
    
    
    Ps.
    4,409,577
    
    
    Ps.
    6,824,693Weighted average common shares
outstanding (in millions)
    
    
    352,421
    
    
    
    345,573
    
    
    
    341,158
 Presentation in the financial statements  Earnings per CPO and per share
   2003
    
    2004
    
    2005Per
    
    
    
    
    
    
    PerSeries A,
    
    
    
    
    
    
    Series A,Per
    
    
    
    
    
    
    B, D
    
    
    
    
    
    
    B, DPer
    
    
    Series A
    
    
    Per
    
    
    and L
    
    
    Per
    
    
    and LCPO
    
    
    Share
    
    
    CPO
    
    
    Share
    
    
    CPO
    
    
    ShareContinuing operations
    
    Ps.
    1.12
    
    
    Ps.
    0.01
    
    
    Ps.
    1.49
    
    
    Ps.
    0.01
    
    
    Ps.
    2.34
    
    
    Ps.
    0.02Cumulative effect of
change in accounting
principles
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net income per CPO/share.
    
    Ps.
    1.12
    
    
    Ps.
    0.01
    
    
    Ps.
    1.49
    
    
    Ps.
    0.01
    
    
    Ps.
    2.34
    
    
    Ps.
    0.02
 F-57




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##### Table of Contents



Presentation in the financial statements  Consolidated balance sheets
  December 31,2004
    
    
    2005ASSETSCurrent assets:Cash and cash equivalents
    
    Ps.
    16,436,569
    
    
    Ps.
    14,665,377Other investments
    
    
    759,378
    
    
    
    112,577Trade notes and accounts receivable, net
    
    
    11,604,240
    
    
    
    13,896,300Other accounts and notes receivable, net
    
    
    1,210,593
    
    
    
    570,610Due from affiliated companies
    
    
    145,686
    
    
    
    295,279Transmission rights and programming
    
    
    3,713,684
    
    
    
    3,120,501Inventories
    
    
    684,848
    
    
    
    638,280Current deferred taxes
    
    
    4,251,651
    
    
    
    3,894,445Other current assets
    
    
    734,650
    
    
    
    578,068Total current assets
    
    
    39,541,299
    
    
    
    37,771,437Non-current assets:Transmission rights and programming
    
    
    2,649,945
    
    
    
    2,235,262Investments
    
    
    6,885,040
    
    
    
    6,605,403Property, plant and equipment, net
    
    
    19,453,314
    
    
    
    19,307,585Goodwill, net
    
    
    7,878,784
    
    
    
    7,307,185Intangible assets, net
    
    
    1,807,724
    
    
    
    2,360,429Deferred taxes
    
    
    4,821,096
    
    
    
    4,175,050Derivate financial instruments
    
    
    1,564,143
    
    
    
    2,214,426Other assets
    
    
    497,192
    
    
    
    201,886Total assets
    
    Ps.
    85,098,537
    
    
    Ps.
    82,178,663LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Current portion of long-term debt
    
    Ps.
    3,406,973
    
    
    Ps.
    340,457Current portion of satellite transporder lease obligation
    
    
    73,101
    
    
    
    75,604Trade accounts payable
    
    
    2,206,412
    
    
    
    2,954,723Customer deposits and advances
    
    
    15,427,906
    
    
    
    15,538,229Taxes payable
    
    
    1,610,711
    
    
    
    1,055,793Current deferred taxes
    
    
    1,650,498
    
    
    
    1,299,000Accrued interest
    
    
    464,352
    
    
    
    334,609Other accrued liabilities
    
    
    1,295,126
    
    
    
    1,558,001Due from affiliated companies
    
    
    66,725
    
    
    
    751,182Total current liabilities
    
    
    26,201,804
    
    
    
    23,907,598Non-current liabilities:Long-term debt
    
    
    19,575,139
    
    
    
    18,137,240Satellite transponder lease obligation
    
    
    1,368,760
    
    
    
    1,186,933Customer deposits and advances
    
    
    385,315
    
    
    
    2,508,200Other long-term liabilities
    
    
    2,232,527
    
    
    
    1,783,556Deferred taxes
    
    
    7,104,368
    
    
    
    5,293,131DTH joint ventures
    
    
    1,304,636
    
    
    
    Pension plans and seniority premiums
    
    
    
    
    
    
    134,892Total liabilities
    
    
    58,172,549
    
    
    
    52,951,550Commitments and contingenciesMinority interest
    
    
    (91,680
    )
    
    
    894,164Total stockholders equity
    
    
    27,017,668
    
    
    
    28,332,949Total liabilities and stockholders equity
    
    Ps.
    85,098,537
    
    
    Ps.
    82,178,663
 F-58




---



##### Table of Contents



Cash flow information
   F-59




---



##### Table of Contents



2003
    
    
    2004
    
    
    2005Operating activities:Net income under U.S. GAAP
    
    Ps.
    3,239,555
    
    
    Ps.
    4,349,525
    
    
    Ps.
    6,824,693Adjustments to reconcile net income to cash provided by operating
activities:Equity in
losses (income) of affiliates
    
    
    1,079,106
    
    
    
    (137,345
    )
    
    
    (160,158
    )Minority interest from continuing operations
    
    
    (130,697
    )
    
    
    266,080
    
    
    
    1,094,431Depreciation and amortization
    
    
    1,544,715
    
    
    
    2,076,822
    
    
    
    3,006,572Impairment
adjustments
    
    
    
    
    
    
    59,131
    
    
    
    7,439Deferred debt refinancing costs, net of amortization
    
    
    
    
    
    
    
    
    
    
    560,043Pension plans and seniority premiums
    
    
    134,542
    
    
    
    63,877
    
    
    
    316,962Deferred income tax
    
    
    194,808
    
    
    
    97,932
    
    
    
    (726,426
    )(Gain) loss on disposal of investment
    
    
    (484,595
    )
    
    
    126,536
    
    
    
    (1,133,372
    )Unrealized foreign exchange loss, net
    
    
    241,525
    
    
    
    (73,788
    )
    
    
    (609,050
    )Employee stock option plans
    
    
    300,296
    
    
    
    318,424
    
    
    
    279,857Maintenance reserve
    
    
    
    
    
    
    (1,497
    )
    
    
    (4,950
    )(Gain) loss from monetary position
    
    
    (238,633
    )
    
    
    155,130
    
    
    
    (178,302
    )5,880,622
    
    
    
    7,300,827
    
    
    
    9,277,739Changes in operating assets and liabilities:Decrease (increase) in:Trade notes and accounts receivable and customer
deposits and advances, net
    
    
    697,201
    
    
    
    53,695
    
    
    
    (438,775
    )Inventories
    
    
    16,798
    
    
    
    (112,937
    )
    
    
    46,568Transmission rights, programs and films and production talent advances
    
    
    (179,122
    )
    
    
    394,837
    
    
    
    662,668Other accounts and notes receivable and other current assets
    
    
    (113,823
    )
    
    
    (419,822
    )
    
    
    696,400(Decrease) increase in:Trade accounts payable
    
    
    159,251
    
    
    
    (421,961
    )
    
    
    827,734Other liabilities and taxes payable
    
    
    374,879
    
    
    
    282,211
    
    
    
    (807,310
    )955,184
    
    
    
    (223,977
    )
    
    
    987,285Cash provided by operating activities
    
    
    6,835,806
    
    
    
    7,076,850
    
    
    
    10,265,024Financing activities:Issuance of Senior Notes due 2025
    
    
    
    
    
    
    
    
    
    
    6,655,800Prepayments
of Senior Notes and UDI-denominated Notes
    
    
    
    
    
    
    
    
    
    
    (5,440,227
    )Other changes in notes payable
    
    
    (223,086
    )
    
    
    2,734,926
    
    
    
    (4,502,536
    )Derivative
financial instruments
    
    
    (1,446,031
    )
    
    
    1,054,382
    
    
    
    (696,612
    )Shares issued
    
    
    4,373,269
    
    
    
    
    
    
    
    Repurchase and sale of capital stock issued
    
    
    (4,979,011
    )
    
    
    (236,871
    )
    
    
    (879,865
    )Gain on issuance of shares of investee
    
    
    
    
    
    
    111,465
    
    
    
    Dividends paid
    
    
    (621,603
    )
    
    
    (4,114,065
    )
    
    
    (4,305,789
    )Minority interest
    
    
    16,091
    
    
    
    (89,588
    )
    
    
    (108,588
    )Cash used by financing activities
    
    
    (2,880,371
    )
    
    
    (539,751
    )
    
    
    (9,277,817
    )Investing activities:Other investments
    
    
    (2,260,677
    )
    
    
    1,764,483
    
    
    
    622,308Due from affiliated companies, net
    
    
    (299,640
    )
    
    
    (55,506
    )
    
    
    535,044Equity investments and other advances
    
    
    1,156,930
    
    
    
    (295,304
    )
    
    
    517,407Investments in property, plant and equipment
    
    
    (719,953
    )
    
    
    (1,937,324
    )
    
    
    (2,432,331
    )Intangible assets and other assets
    
    
    (238,554
    )
    
    
    (211,763
    )
    
    
    (1,458,068
    )Cash used for investing activities
    
    
    (2,361,894
    )
    
    
    (735,414
    )
    
    
    (2,215,640
    )Net increase (decrease) in cash and cash equivalents
    
    
    1,593,541
    
    
    
    5,801,685
    
    
    
    (1,228,433
    )Translation effect on cash and cash equivalents
    
    
    (55,589
    )
    
    
    6,383
    
    
    
    (12,646
    )Effect of inflation on cash and cash equivalents
    
    
    (399,350
    )
    
    
    (661,139
    )
    
    
    (530,113
    )Net increase
in cash and temporary investments of Innovas consolidation
    
    
    
    
    
    
    483,450
    
    
    
    Cash and cash equivalents at beginning of year
    
    
    9,667,588
    
    
    
    10,806,190
    
    
    
    16,436,569Cash and cash equivalents at end of year
    
    Ps.
    10,806,190
    
    
    Ps.
    16,436,569
    
    
    Ps.
    14,665,377
 F-60




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##### Table of Contents



2003
    
    
    2004
    
    
    2005Interest
    
    Ps.
    1,138,173
    
    
    Ps.
    1,691,977
    
    
    Ps.
    1,997,036Income taxes and/or assets tax
    
    
    522,139
    
    
    
    743,799
    
    
    
    535,638
 Supplemental disclosures about non-cash activities:
 2003
    
    
    2004
    
    
    2005Note receivable related to customer deposits
    
    Ps.
    8,742,107
    
    
    Ps.
    10,553,476
    
    
    Ps.
    12,299,271
 Recently issued accounting standards
      F-61




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##### Table of Contents



Consolidated valuation and qualifying accounts
 Balance at
    
    
    
    
    
    
    
    
    
    
    Balance atBeginning of
    
    
    
    
    
    
    
    
    
    
    EndDescription
    
    Period
    
    
    Additions
    
    
    Deductions
    
    
    of PeriodContinuing operations:Reserve for damage, obsolescence or
deterioration of inventory:Year ended December 31, 2003
    
    Ps.
    9,496
    
    
    Ps.
    2,927
    
    
    Ps.
    (60
    )
    
    Ps.
    12,363Year ended December 31, 2004
    
    
    12,363
    
    
    
    1,744
    
    
    
    (5,427
    )
    
    
    8,680Year ended December 31, 2005
    
    
    8,680
    
    
    
    2,342
    
    
    
    
    
    
    
    11,022Allowances for doubtful accounts (1):Year ended December 31, 2003
    
    Ps.
    1,036,053
    
    
    Ps.
    387,748
    
    
    Ps.
    (460,055
    )
    
    Ps.
    963,746Year ended December 31, 2004
    
    
    963,746
    
    
    
    539,135
    
    
    
    (261,875
    )
    
    
    1,241,006Year ended December 31, 2005
    
    
    1,241,006
    
    
    
    310,974
    
    
    
    (343,912
    )
    
    
    1,208,068
 
 (1)
Include allowances for trade and non-trade doubtful
accounts. 25. Subsequent events
     F-62