FORM 6-K

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                    Pursuant to Rule 13a-16 or 15d-16 of the
                             Securities Act of 1934

                         For the month of November 2003

                                 MULTICANAL S.A.
             (Exact name of Registrant as specified in its charter)

                                MULTICHANNEL S.A.
                 (Translation of Registrant's name into English)

                                   Avalos 2057
                         (1431) Buenos Aires, Argentina
                    (Address of principal executive offices)


Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.

                 Form 20-F   X                       Form 40-F
                           -----                               -----
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g-3-2(b) under the Securities Exchange Act of
1934.

                 Yes                                  No    X
                     ------                               -----

If "Yes" is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b):

                          82 - ______________________.


<PAGE>

                MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                       CONDITION AND RESULTS OF OPERATIONS

Forward-looking Statements

         This document may contain statements that could constitute
forward-looking statements, including, but not limited to the Company's
expectations for its future performance, revenues, income, earnings per share,
capital expenditures, dividends, liquidity and capital structure; the impact of
emergency laws enacted by the Argentine government since early 2002; and the
impact of rate changes and competition on the Company's future financial
performance. Forward-looking statements may be identified by words such as
"believes", "expects", "anticipates", "projects", "intends", "should", "seeks",
"estimates", "future" or other similar expressions. Forward-looking statements
involve risks and uncertainties that could significantly affect the Company's
expected results. The risks and uncertainties include, but are not limited to,
uncertainties concerning the impact of emergency laws enacted by the Argentine
government which have resulted in the repeal of Argentina's Convertibility Law,
the devaluation of the peso, restrictions on the ability to exchange pesos into
foreign currencies, and the adoption of a restrictive currency transfer policy.
Changes in laws and economic and business conditions in Argentina have been
extensive and rapid. It is difficult to predict the impact of these changes on
the Company's future financial condition. Other factors may include, but are not
limited to, the implications of the recession that affected Argentina from 1998
through 2002, a potential increase in inflationary pressure and reduction in
consumer spending and the outcome of certain legal proceedings. Readers are
cautioned not to place undue reliance on forward-looking statements, which speak
only as the date of this document. The Company undertakes no obligation to
release publicly the results of any revisions to forward-looking statements
which may be made to reflect events and circumstances after the date of this
press release, including, without limitation, changes in the Company's business
or to reflect the occurrence of unanticipated events. Readers are encouraged to
consult the Company's Form 20-F as well as periodic filings made on Form 6-K,
which are filed with or furnished to the United States Securities and Exchange
Commission.

Recent Developments

         Substantially all of our operations, property and customers are located
in Argentina. Accordingly, our revenues are primarily in pesos and our financial
condition and results of operations depend primarily on macroeconomic and
political conditions prevailing in Argentina. Substantially all of our debt,
however, is denominated in U.S. dollars.

         During 2001 and 2002, Argentina went through a period of great
political, economic and social instability, leading to the early resignation of
President de la Rua, the default on part of Argentina's sovereign debt and the
devaluation of the Argentine peso in January 2002, after more than 10 years of
parity with the U.S. dollar. Following the election of Eduardo Duhalde as
President in 2002, the Argentine government undertook a number of far-reaching
initiatives affecting Argentina's economy in general and its financial system in
particular. These measures radically changed the monetary and foreign exchange
regime of the country and the regulatory environment for doing business in
Argentina, for all sectors of activity. The impact of these measures on the
Argentine economy was significant in 2002 and remains uncertain in the long run.

         Even though the Duhalde administration succeeded in stabilizing the
main macroeconomic variables in the second half of 2002, it would still be
premature to conclude that Argentina's economic crisis has ended. Therefore the
current growth and partial stabilization may not be sustainable. Moreover, the
economic policy of the government has consisted mainly of administering the
crisis through monetary and fiscal policies, and has not included structural
reforms considered necessary to support long-term economic growth. Lastly, while
in September 2003 the government made public announcements regarding possible
terms for a restructuring of its foreign debt with private creditors, the final
terms of the restructuring and the timing of such restructuring remain
uncertain.

         The current President, Mr. Nestor Kirchner, while highly critical of
certain policies followed in the 1990s, to which he attributes in part the
crisis that has affected Argentina since 2001, has not yet unveiled a
comprehensive economic program. If the Kirchner administration is not capable of
implementing economic policies needed to turn the economic growth Argentina
experienced in the last three quarters of 2002 and the first half of 2003 into
sustainable development in the long run, there is considerable risk that
political and economic instability will increase. This would likely have a
negative impact on the Argentine economy and on the financial system. In
addition, the economy may suffer additional shocks, especially if political
pressure in Argentina inhibits the implementation of economic policies designed
to generate growth and enhance consumer and investor confidence.

         On December 23, 2001, Argentina declared the suspension of payments on
its sovereign debt, except for debt owed to multilateral credit agencies.
Although Argentina did not default on its debt with multilaterals, during most
of 2002 and the first eight months of 2003 it had numerous rounds of
negotiations with the International Monetary Fund (the "IMF") regarding
Argentina's economic program and the medium-term refinancing of its debt with
the IMF.

         Negotiations with the IMF with regard to a long-term agreement failed
to produce consensus with respect to certain key issues including the increase
in the tariffs charged by the utilities, which remain fixed in pesos at
pre-devaluation levels, and ensuring a medium-term primary surplus in the public
sector accounts that in the IMF's view would be necessary to support Argentina's
medium- and long-term debt repayment capacity. Despite these disagreements, in
September 2003, the Argentine government reached an agreement with the IMF
providing for a three-year rollover of its obligations to the IMF. For 2004, the
agreement specifies a surplus of 3% of GDP and several other qualitative
targets. No primary surplus targets are set for 2005 and 2006.

         In spite of the agreement reached with the IMF in September 2003, the
lack of a strong IMF program may adversely affect Argentina's ability to
restructure its approximately $100 billion of defaulted debt with private
creditors. Argentina's access to the voluntary international credit market is
generally viewed as dependent on the satisfactory resolution of this
restructuring.

         Uncertainties regarding the government's debt restructuring and the
adoption of certain measures affecting key sectors of the economy such as the
utilities and the financial system have a significant impact on the private
sector's ability to grow and invest. If the inability of the Argentine
government and the private sector to complete the restructuring of outstanding
claims and access foreign financing continues, the fiscal situation of the
country could be severely affected, undermining the ability of the government to
implement adequate economic policies (including structural reforms) and that of
the private sector to reinitiate an investment cycle. The consolidation of a
growth cycle in the medium term depends on all these factors. If economic growth
fails to materialize in the medium and long term, political and economic
volatility are likely to recur. This would most likely negatively and materially
impact the different entities operating in Argentina, including the Company.

         On June 18, 2003 the Congress passed a bill, which law became effective
as of July 15, 2003 (Law No. 25.750), regarding the protection of, among others,
assets related to Argentine culture, requiring that corporations in
media-related businesses, including cable television, be owned by Argentine
persons (either natural persons or legal or corporate entities) and establishing
a maximum potential foreign ownership of such companies at 30% of the
outstanding capital stock representing 30% of the voting rights.

         According to the law, "cramdown" provisions set forth in Section 48 of
the Bankruptcy Law, which could result in the transfer of up to 100% of the
equity to the creditors if a voluntary insolvency proceeding (concurso
preventivo) did not result in the approval of a reorganization plan proposed by
the debtor, are not applicable to media-related companies, including cable
television operators, provided they are owned by Argentine persons as required
by Section 3 of Law. No. 25.750. Furthermore, if a media-related company in a
voluntary insolvency proceeding (concurso preventivo) fails to reach agreement
with its creditors, the participation of non-Argentine shareholders in the
capital stock of such media-related company in excess of a 30% ownership cap is
only allowed if the media-related company requests the authorization of the
Executive Branch to exceed such limit and the Executive Branch previously
authorizes such an acquisition.

         In addition, the Argentine government introduced measures that are
intended to reduce the flow of speculative capital into Argentina by imposing a
registration requirement with the Central Bank of Argentina and a minimum
holding period of 180 days. Such measures are effective as of June 30, 2003.

         Also, according to Communication "A" 3973, which was issued by the
Central Bank of Argentina on June 30, 2003, local companies can: (a) make
interest payments abroad on foreign indebtedness at maturity (or within 15 days
of maturity), without prior approval from the Central Bank, and prepay interest
in the context of a debt restructuring process, and (b) make principal payments
abroad of foreign indebtedness at maturity (or 15 days of maturity) without
prior approval from the Central Bank. Communication "A" 3973 also allows
prepayment of principal subject to the satisfaction of the following conditions:
(i) if prepayment of principal is not made in the context of a debt
restructuring process, then the amount prepaid cannot exceed the present value
of such amount; or (ii) if the prepayment is made in the context of a
restructuring process, the new terms and conditions of the debt after the
restructuring, including the amount prepaid, cannot result in an increase of the
present value of the entire existing indebtedness. In both cases, the debt
cannot be repaid within 180 days from the date of disbursement. The present
value is to be calculated based on the implied interest rate of U.S. dollar
forward transactions in regulated markets. Notwithstanding the above, prior to
carrying out any transfers of funds abroad in order to pay principal of or
interest on financial indebtedness, the intervening financial entities must
verify that the relevant debtor has complied with the information requirements
set forth in Communication "A" 3602 (as amended).

         Our liquidity, financial condition, anticipated results of operations
and business prospects have been materially adversely affected by the Argentine
economic crisis and many of the measures taken by the Argentine government. The
economic and financial crisis affecting Argentina has:

         o   resulted in a net loss of subscribers, totaling approximately
             336,600 over the twenty one-month period ended September 30, 2003,
             although we experienced some recovery during the third quarter of
             2003, with a net addition of approximately 15,400 subscribers;

         o   eliminated practically all of our sources of liquidity, resulting
             in our inability to refinance debt that matured in 2002 and is
             scheduled to mature in 2003;

         o   caused us to default in the payment of principal and interest due
             on our 9 1/4% Notes due 2002, 10 1/2% Notes due 2007, 13.125%
             Series E Notes due 2009, 10 1/2% Series C Notes due 2018, Series J
             Floating Rate Notes due 2003 (together, the "Existing Notes"), and
             other financial indebtedness (together, with the Existing Notes,
             the "Existing Debt");

         o   given rise to a significant decline in the value of our assets and
             anticipated revenues; and

         o   raised substantial doubts on the part of our independent
             accountants as to our ability to continue as a going concern.

Continuation of Operations

         In the context of Argentina's severe economic recession, Multicanal
continues to devote its resources and revenues to ensure the continuity of its
operations. To this end, the Company has undertaken various measures, including
deferring payments on its outstanding indebtedness, and renegotiating various
contracts, including its contracts with programming suppliers, to convert
substantially all dollar-denominated costs to peso-denominated costs for 2002,
subject to adjustment to reflect changes in the Company's subscriber base and
its ability to increase subscription fees. The Company engaged the services of a
financial advisor to assist it in connection with the restructuring of its debt.
Accordingly, on January 31, 2003 the Company launched an offer to purchase for
cash (the "Cash Tender Offer") U.S.$100 million of our Existing Debt at a price
of U.S.$300 per U.S.$1,000 aggregate principal amount of Existing Debt tendered
for purchase. The Company will not pay any accrued and unpaid interest
(including default interest and additional amounts, if any) on the Existing Debt
that is tendered for purchase in the Cash Tender Offer.

         Additionally, on February 7, 2003 Multicanal announced its solicitation
(the "APE Solicitation") from holders of its Existing Debt of powers of attorney
in favor of an attorney-in-fact, to execute an acuerdo preventivo extrajudicial
(the "APE"). The APE Solicitation was made subject to several conditions
precedent. The Company will not pay any accrued and unpaid interest (including
default interest and additional amounts, if any) on the Existing Debt that is
exchanged or capitalized pursuant to the APE. On July 25, 2003 and on August 22,
2003 Multicanal announced further amendments to the APE Solicitation and Cash
Tender Offer (as amended, the "Cash Option Solicitation").

         As a result of such amendments, the Company has extended the APE
Solicitation and the Cash Option Solicitation until 5:00 p.m., New York City
time, on December 12, 2003, unless further extended by the Company in its sole
discretion. Although the restructuring described above contemplates a reduction
of our debt, as of November 7, 2003, the date of our auditor's report, the
success of the restructuring is still unknown. If the restructuring is not
successful, we will likely commence voluntary insolvency proceedings (concurso).

Ability to Operate as a Going Concern

         In their report accompanying the Company's unaudited interim
consolidated financial statements for the nine-month period ended September 30,
2003, our independent accountants have noted that although the Company has
prepared such financial statements following accounting principles applicable to
a going concern, the uncertainty related to the outcome of the restructuring
process, the changes in economic conditions in Argentina and the impact of those
changes on the Company create substantial doubt as to the ability of the Company
to continue to operate as a going concern.

Overview

         Set forth below is a discussion and analysis of our results of
operations for the nine-month periods ended September 30, 2003 and 2002. The
financial information included in the discussion below as at September 30, 2003
and 2002 and for the nine-month period ended September 30, 2003 is derived from
our unaudited interim consolidated financial statements. The information in this
section should be read together with the unaudited interim consolidated
financial statements and the related notes included elsewhere in this report.
Our unaudited interim consolidated financial statements were prepared in
accordance with Argentine generally accepted accounting principles ("GAAP"),
which differ from U.S. GAAP.

Changes in Argentine GAAP

         The Professional Council on Economic Sciences of the Autonomous City of
Buenos Aires ("CPCECABA") approved Technical Pronouncements Nos. 16 "Conceptual
framework of the professional accounting standards"; N(degree) 17 "Professional
accounting standards: development of matters of general application", N(degree)
18 "Professional accounting standards: development of certain matters of
specific application", N(degree) 19 "Changes to Technical Pronouncements Nos. 4,
5, 6, 8, 9, 11 and 14", and No. 20 "Financial derivatives and hedging
operations" through Resolutions CD 238/01, CD 243/01, CD 261/01, CD 262/01 and
CD 187, respectively. These technical pronouncements and amendments are
applicable to fiscal years of the Company commencing on or after January 1,
2003. Furthermore, the Comision Nacional de Valores or National Securities
Commission ("CNV") has endorsed the aforementioned technical pronouncements with
respect to companies subject to its jurisdiction, including Multicanal,
incorporating certain amendments, establishing that they are applicable to
fiscal years commencing on or after January 1, 2003. The main amendments to
Argentine GAAP resulting from the adoption of the new technical pronouncements
are as follows:

         o   Adoption of stricter guidelines to determine the recoverable value
             of assets.

         o   Changes in the method for translation of financial statements of
             foreign subsidiaries stated in foreign currencies.

         o   Mandatory application of the deferred tax method. Under this
             method, deferred tax assets or liabilities are recognized with the
             corresponding charge or credit to income for differences between
             the financial and tax basis of assets and liabilities at each
             period-end.

         o   Adding disclosure to the financial statements, including earnings
             per share and the presentation of comparative information.

         o   No amortization of goodwill having unspecified useful life.

         Pursuant to these technical pronouncements, there are certain
transitional rules that enable, and in certain cases require, prospective
application of valuation and disclosure criteria contained in those rules. The
transitional rules applied by the Company, which affect the comparability of the
financial statements, are as follows:

         o   No adjustments were made to the initial balances under the new
             guidelines established to determine the recoverable value of
             assets.

         o   The Company's balances of intangible assets and goodwill as of
             December 31, 2002 having unspecified useful lives were not
             corrected and were not amortized.

         o   As from January 1, 2003, we have applied the new methods for
             translation of financial statements of foreign subsidiaries stated
             in foreign currencies.

Volatility of the Peso

         The devaluation of the peso on January 7, 2002 and the subsequent
increases in the exchange rate, mainly during the first half of 2002, resulted
in a 240% increase in the nominal exchange rate of the peso versus the U.S.
dollar during 2002, reaching its high point of Ps.3.90 per U.S. dollar on June
25, 2002. At September 30, 2003, the peso/dollar rate quoted by Banco de la
Nacion Argentina was Ps. 2.915 to U.S.$1.00. Subsequently, the peso recovered in
value versus the dollar, trading at a rate of approximately Ps. 2.85 per
U.S.$1.00 at November 10, 2003.

         Despite the positive effects of the real depreciation of the peso on
the competitiveness of certain sectors of the Argentine economy, the
depreciation has had a negative impact on the ability of Argentine businesses to
honor foreign debt, has strongly reduced real wages and has had a negative
impact on businesses whose activity is dependent on the domestic market demand,
such as utilities and the financial industry. Consequently, the devaluation has
adversely affected the government's tax revenues (measured in dollars) and
therefore its ability to honor its foreign debt obligations.

         An excessive appreciation of the peso would also have negative effects.
Therefore, significant fluctuations in the value of the peso would have
significant adverse effects on the Argentine economy and on our financial
condition and results of operations. Given the continuing economic crisis in
Argentina and the prevailing economic and political uncertainties, it is
impossible to predict whether, and to what extent, the value of the peso may
further depreciate or appreciate against the U.S. dollar and how those
uncertainties will affect us.

         Except as otherwise set forth in this report, dollar-denominated assets
and liabilities have been converted into pesos at a rate of Ps. 2.815 per
U.S.$1.00 in the case of assets and Ps. 2.915 per U.S.$1.00 in the case of
liabilities, the buy/sell exchange rates reported by Banco de la Nacion
Argentina on September 30, 2003.

Inflation Accounting

         Effective September 1, 1995, Argentine regulations applicable to us
required us to discontinue restating our financial statements to recognize
changes in the purchasing power of the peso. Prior to March 6, 2002, accounting
principles did not differ from applicable regulations provided that the annual
change in the WPI did not exceed 8% per annum. During the years ended December
31, 1999, 2000 and 2001 the WPI increased by 1.2%, increased by 2.5% and
decreased by 5.6%, respectively. Beginning in January 2002, the inflation rate
in Argentina began to increase significantly.

         To counter both the high inflation rates brought about by the end of
the convertibility monetary system in Argentina at the beginning of 2002 and the
distortion this caused in Argentine companies' financial statements, the
Argentine government issued Decree N(degree) 1269/02 on July 17, 2002. This
decree provides for the reestablishment of the restatement of financial
information to account for inflation and instructed the CNV to issue specific
regulations regarding its application to companies such as us subject to the
CNV's jurisdiction. Consequently, on July 25, 2002, the CNV issued Resolution
415/2002, providing that financial statements filed subsequent to the date of
the Resolution be restated to recognize changes in the purchasing power of the
peso, starting January 1, 2002. On March 25, 2003 the Argentine government
issued Decree N(degree) 664/03 providing that financial statements for periods
ending on a date subsequent to the date of that Decree be expressed in nominal
currency. Consequently, the CNV issued Resolution N(degree) 441/03 providing for
the elimination of inflation adjustment for all financial statements, effective
March 1, 2003. Given that the CPCECABA has not yet approved the discontinuance
of the restatement of financial statements, the elimination of inflation
adjustment for all financial statements does not comply with Argentine GAAP.
Accordingly, the Company's results for any period prior to March 1, 2003 have
been restated as follows:

         o   results accumulating monetary transactions, such as net sales,
             operating costs, and administrative and selling expenses, have been
             restated in constant Argentine pesos, applying to the original
             value the conversion factor referenced in the WPI from the month in
             which the transaction took place to the date of the next succeeding
             fiscal quarter.

         o   results related to non-monetary assets valued at restated costs,
             such as amortization and depreciation, have been computed based on
             the restated amounts of such assets.

         Financial results have been valued net of general inflation on the
related assets and liabilities. The effect of inflation on the remaining
monetary assets and liabilities has been disclosed as "Results of exposure to
inflation". The income statement for the period ended September 30, 2003
reflects the effects of inflation on the Company's net holdings of monetary
assets and liabilities during January and February 2003. Assets and liabilities
are considered "monetary" for purposes of restatement for wholesale-price level
changes if their values are fixed by contract or otherwise in terms of number of
currency units, regardless of changes in specific prices or in the WPI. Examples
of "monetary" assets and liabilities include peso-denominated accounts
receivable, accounts payable and cash. The restatement of the income statement
to reflect wholesale price level changes merely reflects the effects of
inflation, and does not imply either a generation or use of funds.

         Additionally, amounts for the nine-month period ended September 30,
2002, presented herein for comparative purposes, are presented in constant pesos
of February 28, 2003 using a conversion factor equal to 0.994, which represents
the inflation index rate (based on wholesale prices) for the five-month period
ended February 28, 2003. As described above, inflation adjustment was
discontinued as of March 1, 2003.

Subscribers

         The following table sets forth selected information relating to
Multicanal within each of the areas in which we operated as of September 30,
2003 based on Multicanal's internally generated market information:

<TABLE>
                     Cities of
                       Buenos
                     Aires, La      Atlantic
                     Plata and     Coast and                 Total
                      Greater       Central                Argentine                             Total           Total
                    Buenos Aires   Argentina     Litoral    Regions     Paraguay   Uruguay   International    Multicanal
--------------------------------------------------------------------------------------------------------------------------
<S>                   <C>          <C>          <C>         <C>          <C>       <C>           <C>          <C>
Multicanal Homes
Passed                2,952,281    1,048,687    427,480     4,428,448    327,300   520,000       847,300      5,275,748

Multicanal
Subscribers             450,394      273,357    123,283      847,034      41,411    76,446       117,857        964,891

Multicanal
Penetration               15.3%        26.1%      28.8%        19.1%       12.7%     14.7%         13.9%          18.3%

</TABLE>

         Multicanal's annualized churn rate for the three-month period ended
September 30, 2003 was 16.4% as compared to 58.8% for the three-month period
ended September 30, 2002. The decrease in the churn rate is primarily due to the
stability of the Argentine economy during the nine-month period ended September
30, 2003, resulting in a lower loss of subscribers and disconnections.
Multicanal's churn rate is determined by calculating the total number of
disconnected cable television customers during each of the periods as a
percentage of the initial number of cable television customers for each such
period. We experienced a net loss of subscribers, totaling approximately 336,600
over the twenty one-month period ended September 30, 2003, although we
experienced some recovery during the third quarter of 2003, with a net addition
of approximately 15,400 subscribers.

         Our EBITDA for the nine-month period ended September 30, 2003 was Ps.
122.0 million, a 10.4% increase compared to our EBITDA of Ps. 110.5 million for
the nine-month period ended September 30, 2002. Our bank and financial debt,
including accrued interest and seller debt, outstanding at September 30, 2003
totaled Ps. 1,909.3 million (consisting of U.S.$ 630.5 million and Ps. 71.3
million), compared to Ps. 2,048.3 million (consisting of U.S.$ 583.7 million and
Ps. 66.5 million) at December 31, 2002.

Nine-month period ended September 30, 2003 and 2002

         Net Revenues. Net revenues were Ps. 373.8 million for the nine-month
period ended September 30, 2003. This figure represents a decrease of 19.3%
compared to net revenues of Ps. 463.2 million for the nine-month period ended
September 30, 2002. The decrease in net revenues in this period as compared to
the nine-month period ended September 30, 2002 is attributable to our inability
to increase the basic fees for our services at a rate equal to or greater than
the general rate of inflation (during the year ended December 31, 2002 and the
first nine months of 2003 we increased prices approximately 53%, compared with
an increase in the WPI in the same period of 115.1%), the loss of subscribers
(approximately 297,400 over the nine-month period ended September 30, 2002, as
compared to a net addition of 15,400 over the nine-month period ended September
30, 2003), and a reduction in advertising sales. This decrease in net revenues
was partially offset by an increase in other sales, as well as a decrease of
charges for the allowance for doubtful accounts.

         Our revenues are presented net of charges for the allowance for
doubtful accounts.

         Direct Operating Expenses. Our direct operating expenses were Ps. 181.6
million for the nine-month period ended September 30, 2003. This figure
represents a decrease of 26.5% over our direct operating expenses of Ps. 247.1
million in the nine-month period ended September 30, 2002, which is mainly
attributable to a decrease in programming rights, payroll and social security,
printing and distribution of magazines, taxes, rates and contributions, rentals
and sundry.

         Direct operating expenses consist principally of:

         o   signal delivery fees paid to programming suppliers,

         o   wages, benefits and fees paid to employees and subcontracted
             service firms for the repair and maintenance of Multicanal-owned
             cable networks and customer disconnections, and

         o   to a lesser extent, the costs of related materials consumed in
             these repair and maintenance activities (primarily in foreign
             currency, since these inputs are imported), costs associated with
             pole rental and the printing cost for Multicanal's monthly
             publication.

         Selling, General, Administrative and Marketing Expenses. Our selling,
general, administrative and marketing expenses were Ps. 70.2 million in the
nine-month period ended September 30, 2003. This figure represents a decrease of
33.5% from Ps. 105.5 million in the nine-month period ended September 30, 2002,
which is attributable principally to a decrease in payroll and social security,
sales commissions, taxes, rates and contributions, fees and compensation for
services, publicity and advertising, sundry, building expenses, and employee
dismissals.

         Our selling, general, administrative and marketing expenses consist of:

         o   professional fees,
         o   wages and benefits of non-technical employees,
         o   sales commissions,
         o   advertising,
         o   insurance,
         o   rental of office space,
         o   other office related
         o   expenses, and
         o   various direct taxes previously charged directly to our gross
             revenues.

         Depreciation and Amortization. Depreciation and amortization expenses
were Ps. 117.6 million in the nine-month period ended September 30, 2003. This
figure represents a decrease of 50.4% compared to depreciation and amortization
expenses of Ps. 237.4 million in the nine-month period ended September 30, 2002.
This decrease in the Company's depreciation and amortization expenses was mainly
due to the discontinuance of the amortization of goodwill according to the
application of the new accounting rules issued by the CPCECABA through
Resolutions N(degree) 17, 18, 19 and 20. During the nine-month period ended
September 30, 2003, the Company has not recorded any impairment charge according
to the new accounting rules that require that the Company test long-lived assets
for impairment whenever indicators of impairment exist.

         Financial (Income) Expenses and Holding Gains Net. Our net financial
gains were Ps. 91.3 million in the nine-month period ended September 30, 2003,
compared with financial expenses and holding losses, net, of Ps. 568.3 million
in the nine-month period ended September 30, 2002. The net financial gains are
attributable principally to the impact of the appreciation of the peso in
relation to the U.S. dollar on the Company's U.S. dollar-denominated debt (Ps.
294.7 million), compared to a loss of Ps. 1,038.0 million due to the effect of
the devaluation of the peso in the nine-month period ended September 30, 2002.
The effect of the devaluation of the peso in the nine-month period ended
September 30, 2002 was partially offset by: (i) the cancellation of Notes
acquired at a discount from face value in the open market during such period
(Ps. 420.9 million) and (ii) net gains resulting from the impact of inflation on
our monetary assets and liabilities (Ps. 235.1 million). Net losses resulting
from the impact of inflation on our monetary assets and liabilities during the
nine-month period ended September 30, 2003 were Ps. 0.3 million.

         Other Non-Operating Income (Expenses), Net. Other non-operating income
net, was Ps. 6.1 million in the nine-month period ended September 30, 2003,
compared to other non-operating income, net, of Ps. 1.4 million in the
nine-month period ended September 30, 2002. Other non-operating income, net,
during the nine-month period ended September 30, 2003 compared to other
non-operating income for the same period in 2002, is attributable mainly to an
increase in sundry and to severance payments collected.

         Income Taxes and/or Tax on Minimum Notional Income. We recorded income
taxes during the nine-month period ended September 30, 2003 of Ps. 25.0 million.
However, during the nine-month period ended September 30, 2002 the Company
recorded a gain of Ps. 251.8 million. The increase in income taxes for the
nine-month period ended September 30, 2003 is mainly due to the income tax
charge resulting from the financial gain attributable to the impact of the
appreciation of the peso in relation to the U.S. dollar on the Company's U.S.
dollar-denominated debt and income taxes paid under Multicanal's
subsidiaries, and was partially offset by a decrease in the deferred tax
allowance. The gain recorded during the nine-month period ended September 30,
2002 reflects mainly a tax loss carry-forward generated by the impact of the
devaluation on the Company's U.S. dollar-denominated debt. Such tax loss
carry-forward was recorded during the nine-month period ended September 30, 2002
according to the deferred income tax method, and is expected to be recovered in
the future based upon the Company's projections. Additionally, in October 2001
the Company was added to the register of beneficiaries of the agreements to
improve competitiveness and employment and as a result, the Company was exempted
from the tax on minimum notional income for fiscal year 2001 and future years.
That exemption as originally contemplated in the competitiveness law expired on
March 31, 2003. In our case, this will result in the reimposition of the minimum
notional income tax.

         Net Gain/Loss. We had a net gain of Ps. 78.3 million in the nine-month
period ended September 30, 2003, as compared to a net loss of Ps. 429.1 million
in the nine-month period ended September 30, 2002, as a result of the factors
described above.

         EBITDA. Our EBITDA in the nine-month period ended September 30, 2003
was Ps. 122.0 million. This figure represents an increase of 10.4% compared to
our EBITDA of Ps. 110.5 million in the nine-month period ended September 30,
2002. Our EBITDA margin (EBITDA/net revenues) increased to 32.6% compared to
23.9%, due primarily to a decrease in costs at a faster pace than the reduction
of revenues.

Liquidity and Capital Resources

         We operate in a capital intensive industry which requires significant
investments. In the past, our growth strategy has involved the acquisition of
other cable television companies and the active improvement and expansion of our
existing and acquired networks and equipment. We have historically relied on
four main sources of funds:

         o   equity contributions from our shareholders;

         o   borrowings under bank facilities or debt security issuances;

         o   cash flow from operations; and

         o   financing by sellers of cable systems we acquire.

         The conditions affecting the Argentine economy since 1998 and the
uncertainties as to future developments have prevented us from raising the funds
required to discharge our debt obligations as they became due in 2002 and are
coming due in 2003. As a result, we have defaulted on all payments on our
Existing Notes that have come due, and all principal payments and a substantial
portion of our interest payments on our Bank Loans since February 2002. As a
result of these payment defaults, all of our Existing Notes that have not yet
matured could be declared immediately due and payable by the holders.
Furthermore, our decision to seek a restructuring of substantially all our
financial debt may be considered to give rise to an automatic acceleration under
our existing Indentures. Since February 2002, we have devoted our cash flow from
operations primarily to ensure the continuation of our operations. We have been
informed that as of November 10, 2003, at least 34 involuntary bankruptcy
(quiebra) petitions have been filed against us. Of those 34 petitions, we have
been served with process on 33, 31 have been dismissed by the court and the
decision of the court of first instance has become final and non-appealable in
the remaining two as a result of the plaintiffs' failure to file an appeal
within the prescribed time period. The final outcome of these petitions,
together with the economic conditions in Argentina and their impact on our
financial condition, and the possibility that the APE Solicitation will be
unsuccessful, may cause us to commence a voluntary insolvency proceeding
(concurso preventivo). The filing of a voluntary insolvency proceeding (concurso
preventivo) may result in a partial or total loss of an investment in our
Existing Debt.

         As of September 30, 2002, we had a shortfall in consolidated working
capital amounting to Ps.1,805.9 million. The Company's accumulated losses have
exceeded 50% of its capital and 100% of its reserves. Although section 206 of
the Argentine Companies Law establishes mandatory capital reduction in such
situations, by means of Decree No. 1269/02 dated July 17, 2002, the government
suspended enforcement of this regulation until December 10, 2003. It is unclear
whether the government will renew its decision to suspend enforcement of this
regulation. The government's enforcement of the regulation would likely require
us to reduce capital.

         At September 30, 2003, the Company's cash position (including short
term investments) totaled Ps. 152.9 million (U.S.$ 54.3 million). During the
first nine months of 2003 the Company applied cash flows from operating
activities to working capital to ensure the continuity of its operations. The
Company estimates its expenses related to the restructuring of its Existing Debt
at approximately U.S.$ 11.0 million. The Company would also need to use
approximately U.S.$24.3 million of the cash currently available to it to pay the
purchase price in the Cash Option Solicitation. The Company cannot provide any
assurance that it will generate sufficient cash flows from operations to
sufficiently increase its cash on hand to pay the expenses relating to the
restructuring of its Existing Debt when such expenses become due and to maintain
sufficient liquidity to conduct its operations.

<PAGE>

Condensed from the original prepared in Spanish for publication in Argentina

        INDEX TO THE UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

                                 MULTICANAL S.A.


UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS

                                                                           Page
Report of independent accountants ......................................    F-2
Unaudited interim consolidated balance sheet............................    F-4
Unaudited interim consolidated statement of operations..................    F-5
Unaudited interim consolidated statement of changes
in shareholders' equity.................................................    F-6
Unaudited interim consolidated statement of cash flows..................    F-7
Notes to the unaudited interim consolidated financial statements........    F-8
Exhibit.................................................................   F-35

<PAGE>

REPORT OF INDEPENDENT ACCOUNTANTS ON UNAUDITED INTERIM CONSOLIDATED FINANCIAL
STATEMENTS


To the Board of Directors and Shareholders of Multicanal S.A.

1.   We have reviewed the accompanying interim consolidated balance sheet of
     Multicanal S.A. and its subsidiaries as of September 30, 2003, and the
     related interim consolidated statements of operations, of cash flows and of
     changes in shareholders' equity for each of the nine-month periods ended
     September 30, 2003 and 2002. These interim consolidated financial
     statements are the responsibility of the Company's management.

2.   We conducted our reviews in accordance with auditing standards generally
     accepted in Argentina. A review of interim financial information consists
     principally of applying analytical procedures to financial data and making
     inquiries of persons responsible for financial and accounting matters. It
     is substantially less in scope than an audit conducted in accordance with
     generally accepted auditing standards, the objective of which is the
     expression of an opinion regarding the financial statements taken as a
     whole. Accordingly, we do not express such an opinion.

3.   As indicated in Note 2.2., as from January 1, 2003 the Company has applied
     new accounting valuation and disclosure standards approved by the
     Professional Council in Economic Sciences of the Autonomous City of Buenos
     Aires and the National Securities Commission, which require adjustments to
     prior years' results, and reclassifications and adjustments to the
     comparative information. Furthermore, there are certain transitional rules
     that enable and in certain cases require the prospective application of
     valuation and disclosure criteria incorporated in the new accounting
     standards, which affect comparability of the financial statements, as
     indicated in the mentioned note.

4.   The Company has prepared the financial statements applying valuation and
     restatement criteria established by the National Securities Commission
     which, as explained in Notes 2.3. and 2.6.(k), differ in certain aspects
     from the accounting standards in effect in the Autonomous City of Buenos
     Aires, especially as regards recognition of the effects of inflation on the
     financial statements and the treatment of assets and liabilities generated
     by application of the deferred tax method.

5.   Accounting principles generally accepted in Argentina require companies
     with a controlling financial interest in other companies to present both
     parent company, where investments in subsidiaries are accounted for by the
     equity method, and consolidated financial statements as primary and
     supplementary information, respectively. Because of the special purpose of
     these condensed unaudited interim consolidated financial statements, parent
     company financial statements are not included. This procedure has been
     adopted for the convenience of the reader of these condensed unaudited
     interim consolidated financial statements.

6.   As explained in Note 7, the Company failed to make scheduled payments on
     all of its Negotiable Obligations and was notified of the filing of various
     petitions for bankruptcy against it. The Company has undertaken a financial
     debt restructuring process, by making a public offer for the re-purchase of
     part of the issue of negotiable obligations and other financial debts in a
     first stage and by soliciting the holders of existing debt to grant a
     power-of-attorney in favor of an attorney-in-fact in order to enter into an
     out-of-court creditors' arrangement (APE Solicitation), in a second stage.
     As of the date of this report, the result of the restructuring process
     cannot be estimated. The Company believes that if this process is
     unsuccessful, it will likely have to file for a voluntary insolvency
     proceeding. The Company has prepared the accompanying condensed unaudited
     interim consolidated financial statements applying accounting principles
     applicable to a going concern. Consequently, these financial statements do
     not include the effects of potential adjustments and reclassifications that
     might be required if the Company is not able to continue as a going concern
     and is forced to realize its assets and settle its liabilities, including
     contingent liabilities, in conditions other than through the normal course
     of business.

7.   We are not in a condition to foresee if the assumptions used by Management
     to prepare their projections will take place in the future and as a result,
     if the recoverable value of the net asset of deferred taxes will exceed its
     corresponding net book value.

8.   As indicated in Note 12, at September 30, 2003, the losses recorded by the
     Company exceed 50% of its capital and 100% of its reserves. Although
     section 206 of the Commercial Companies Law establishes a mandatory capital
     reduction in such situations, by means of Decree 1269/02, the National
     Executive suspended enforcement of this regulation until December 10, 2003.

9.   Our report dated March 10, 2003 on the financial statements of Multicanal
     S.A. at December 31, 2002 included a qualifying statement on the
     recoverability of intangible assets and goodwill. As set out in Note 2.2.,
     the Technical Pronouncements approved by the National Securities Commission
     establish that, for comparison with recovery values, undiscounted cash flow
     projections must be used and on the basis of this new comparison, the
     uncertainty created at that time is eliminated. Therefore, our opinion on
     the financial statements at December 31, 2002 differs from the one
     originally given.

10.  Based on the work done and our examination of the financial statements of
     the Company and its consolidated financial statements for the years ended
     December 31, 2002 and 2001, on which we issued our qualified report dated
     March 10, 2003 due to the uncertainty as to (i) the Company's capacity to
     fulfill its financial commitments, (ii) the recoverability of the
     intangible assets, goodwill and net deferred tax assets balance and (iii)
     the Company's capacity to continue operating as a going concern, we report
     that the unaudited interim consolidated financial statements of Multicanal
     S.A. at September 30, 2003 and 2002 consider all significant facts and
     circumstances which are known to us. We have no observations to make other
     than those indicated in points 4 to 7.

11.  The information included for comparison purposes in the consolidated
     balance sheets and in the supplementary notes to the attached financial
     statements, arises from the Company's accounting records at December 31,
     2002 on which adjustments have been made through applying the new
     prevailing accounting standards.

12.  The accompanying condensed consolidated financial statements are presented
     on the basis of accounting principles generally accepted in Argentina,
     which differ from the accounting principles generally accepted in other
     countries, including the United States of America.



Buenos Aires, Argentina                     PRICE WATERHOUSE & CO.
November 7, 2003
                                            by /s/ Alberto E. Fandino  (Partner)
                                               ---------------------------------
                                               Alberto E. Fandino
<PAGE>

Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A.
                  UNAUDITED INTERIM CONSOLIDATED BALANCE SHEET
                  (At September 30, 2003 and December 31, 2002)
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)
<TABLE>

                                                                                 September 30,          December 31,
                                                                              -------------------- -----------------------
                                                                                     2003                   2002
                                                                                  (Unaudited)
                                                                              --------------------------------------------
                                                                                                 $
                                                                              --------------------------------------------
                                 ASSETS
<S>                                                                                  <C>                   <C>
CURRENT ASSETS
Cash and banks...........................................................            152,080,310           105,568,370
Short-term investments (Note 3 (a)) .....................................                784,564             1,455,602
Trade receivables (Note 3 (b))...........................................             13,314,089            25,093,209
Receivables from related parties.........................................             12,391,609            12,852,899
Other (Note 3 (c)).......................................................             44,686,003            38,326,935
                                                                              -------------------- -----------------------
         Total current assets............................................            223,256,575           183,297,015
                                                                              -------------------- -----------------------
NON-CURRENT ASSETS

Long-term investments (Note 3 (e)).......................................              8,322,400             7,306,722
Property and equipment, net (Note 4).....................................            521,437,603           624,697,897
Intangible assets (Note 5)...............................................             36,037,114            37,062,655
Goodwill (Note 3(f)).....................................................          1,171,443,563         1,173,368,404
Other (Note 3 (d)).......................................................            342,554,049           367,574,507
                                                                              -------------------- -----------------------
         Total non-current assets........................................          2,079,794,729         2,210,010,185
                                                                              -------------------- -----------------------
         Total assets ...................................................          2,303,051,304         2,393,307,200
                                                                              ==================== =======================
                                LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued liabilities.................................             86,277,425           110,728,614
Short-term bank and financial debt (Notes 3 (g) and 7)...................          1,900,866,615         2,035,914,887
Acquisition related debt ................................................              8,072,599             8,804,594
Taxes payable............................................................             16,219,206            15,729,716
Debt with related parties................................................                594,283             1,028,432
Payroll and social security..............................................             10,407,745             9,886,784
Other (Note 3 (h)).......................................................              6,754,232            13,191,225
                                                                              -------------------- -----------------------
         Total current liabilities.......................................          2,029,192,105         2,195,284,252
                                                                              -------------------- -----------------------
NON-CURRENT LIABILITIES
Taxes payable............................................................              2,349,283             2,304,041
Acquisition related debt ................................................                100,633             3,349,215
Long-term bank and financial debt........................................                239,753               239,748
Other (Note 3 (i)).......................................................             18,588,099            19,722,435
Provision for lawsuits and contingencies (Note 6 (c))....................             18,898,435            18,495,701
                                                                              -------------------- -----------------------
         Total non-current liabilities...................................             40,176,203            44,111,140
                                                                              -------------------- -----------------------
         Total liabilities...............................................          2,069,368,308         2,239,395,392
                                                                              -------------------- -----------------------
TEMPORARY TRANSLATION DIFFERENCES                                                      1,954,271                     -
MINORITY INTEREST IN CONSOLIDATED SUBSIDIARIES ..........................             32,373,317            32,807,213
SHAREHOLDERS' EQUITY (as per related statement)..........................            199,355,408           121,104,595
                                                                              -------------------- -----------------------
         Total liabilities, Temporary translation differences, Minority
         interest in consolidated subsidiaries and shareholders' equity..          2,303,051,304         2,393,307,200
                                                                              ==================== =======================
</TABLE>

        The accompanying notes and exhibit are an integral part of these
              unaudited interim consolidated financial statements.

<PAGE>

Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A

             UNAUDITED INTERIM CONSOLIDATED STATEMENT OF OPERATIONS
         (For the nine-month periods ended September 30, 2003 and 2002)
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)
<TABLE>

                                                                                           September 30,
                                                                            --------------------------------------------
                                                                                    2003                   2002
                                                                                 (Unaudited)           (Unaudited)
                                                                            --------------------------------------------
                                                                                                  $
                                                                            --------------------------------------------
<S>                                                                             <C>                      <C>
Net revenues (Note 3 (j) ).............................................         373,826,735              463,154,522
Operating costs
  Direct operating expenses (Exhibit)..................................        (181,630,494)            (247,131,459)
  General and administrative expenses (Exhibit)........................         (46,839,987)             (73,321,402)
  Selling and marketing expenses (Exhibit).............................         (23,341,804)             (32,164,392)
  Depreciation and amortization........................................        (117,646,697)            (237,407,536)
                                                                            ---------------------- ---------------------
Operating gain (loss) .................................................           4,367,753             (126,870,267)
Non-operating expenses
 Financial income / (expenses) and holding results, net
  On assets
    Result of exposure to inflation........................................      (2,006,784)           (167,572,450)
    Exchange differences and results from conversion.......................     (29,146,007)              34,422,740
    Bank expenses..........................................................        (617,997)                (586,858)
    Holding gains/short-term investments...................................         273,468                5,081,524
    Interest...............................................................       1,498,426                 395,323
  On liabilities
    Result of exposure to inflation........................................       1,722,451              402,672,191
    Interest...............................................................    (145,672,413)            (192,226,628)
    Loan restatement ......................................................      (2,367,252)             (19,979,052)
    Result from advanced repurchase of negotiable obligations .............               -              420,871,431
    Exchange differences...................................................     294,664,415           (1,037,986,847)
    Tax on interest........................................................               -                  726,418
    Tax recovery...........................................................               -                  335,316
    Tax on debits and credits to bank current accounts.....................      (4,114,248)              (3,423,748)
    Commissions............................................................     (22,910,667)             (10,988,496)
  Other non-operating income /  (expenses), net (Note 3 (k) )..........           6,132,776                1,435,369
                                                                            --------------------------------------------
Gain / (loss) before taxes, minority interest and equity in the gains /         101,823,921             (693,694,034)
  (losses) of affiliated companies.....................................
Income taxes and/or tax on minimum notional income.....................         (24,996,879)             251,784,082
                                                                            --------------------------------------------
Gain / (loss) before minority interest and equity in the gains / (losses)        76,827,042             (441,909,952)
  of affiliated companies..............................................
Minority interest in results of consolidated  subsidiaries.............            (531,652)              (8,451,925)
Equity in the gains / (losses) of affiliated companies (Note 10).......           1,955,423               21,233,135
                                                                            ---------------------- ---------------------
Net gain / (loss) .....................................................          78,250,813             (429,128,742)
                                                                            ============================================
Weighted average number of shares......................................         371,635,103              366,821,037
                                                                            ============================================
Net gain (loss) per share..............................................                0.21                   (1.17)
                                                                            ============================================
</TABLE>

        The accompanying notes and exhibit are an integral part of these
              unaudited interim consolidated financial statements.



<PAGE>


Condensed from the original prepared in Spanish for publication in Argentina

<TABLE>

                                                       MULTICANAL S.A.

                         UNAUDITED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
                               (For the nine-month periods ended September 30, 2003 and 2002)
                              (Expressed in constant Argentine pesos through February 28, 2003
                           and in nominal pesos thereafter - Note 2.3. -except number of shares)


============================================================================================================================
                                                                SHAREHOLDERS' CONTRIBUTIONS
                                            --------------------------------------------------------------------------------
                               Number of
                              issued and
                              authorized                                      Additional
                             common shares      Share         Adjustments        paid-in         Merger       Irrevocable
                            par value Ps. 1    capital        to capital         capital         premium     contributions
                            ------------------------------------------------------------------------------------------------
                             (Unaudited)     (Unaudited)      (Unaudited)      (Unaudited)     (Unaudited)    (Unaudited)
                                            --------------------------------------------------------------------------------
<S>                          <C>             <C>              <C>             <C>                <C>             <C>
At January 1, 2002           366,821,037     366,821,037      469,187,808     1,052,448,962      33,930,620      4,814,066
Changes to initial
   balance                             -               -                -                 -               -              -
Restated initial
balances                     366,821,037     366,821,037      469,187,808     1,052,448,962      33,930,620      4,814,066
Net loss for the period              -               -                -                 -               -              -
At September 30, 2002        366,821,037     366,821,037      469,187,808     1,052,448,962      33,930,620      4,814,066
At January 1, 2003           366,821,037     366,821,037      469,187,808     1,052,448,962      33,930,620      4,814,066
Changes to initial
   balance (note 2.2.)                 -               -                -                 -               -              -
                             -----------------------------------------------------------------------------------------------
Restated initial
balances                     366,821,037     366,821,037      469,187,808     1,052,448,962      33,930,620      4,814,066
Capital increase
resolved by the
Self-called
Extraordinary Meeting
of Shareholders dated
August 8, 2003                 4,814,066       4,814,066                -                 -               -     (4,814,066)

Net gain for the period                -               -                -                 -               -              -
                             -----------------------------------------------------------------------------------------------
At September 30, 2003        371,635,103     371,635,103      469,187,808     1,052,448,962      33,930,620              -
============================================================================================================================


                                                              Retained
                                                              earnings            Total
                                                Legal       (accumulated       shareholders'
                              Reserve          reserve         deficit)           equity
                             -----------------------------------------------------------------
                             (Unaudited)     (Unaudited)     (Unaudited)        (Unaudited)
                             -----------------------------------------------------------------

At January 1, 2002            64,519,465       6,356,401   (1,268,153,644)      729,924,715
Changes to initial
   balance                             -               -       81,108,019        81,108,019
Restated initial
balances                      64,519,465       6,356,401   (1,187,045,625)      811,032,734
Net loss for the period                -               -     (429,128,742)     (429,128,742)
At September 30, 2002         64,519,465       6,356,401   (1,616,174,367)      381,903,992
At January 1, 2003            64,519,465       6,356,401   (2,213,566,046)     (215,487,687)
Changes to initial
   balance (note 2.2.)                 -               -      336,592,282       336,592,282
                              ----------------------------------------------------------------
Restated initial
balances                      64,519,465       6,356,401   (1,876,973,764)      121,104,595
Capital increase
resolved by the
Self-called
Extraordinary Meeting
of Shareholders dated
August 8, 2003                         -               -                -                 -

Net gain for the period                -               -       78,250,813        78,250,813
                              ----------------------------------------------------------------
At September 30, 2003         64,519,465       6,356,401   (1,798,722,951)      199,355,408
==============================================================================================
</TABLE>

        The accompanying notes and exhibit are an integral part of these
               unaudited interim consolidated financial statement.

<PAGE>


Condensed from the original prepared in Spanish for publication in Argentina


                                 MULTICANAL S.A.
             UNAUDITED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
         (For the nine-month periods ended September 30, 2003 and 2002)
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)


<TABLE>
                                                                                       September 30,
                                                                          ----------------------------------------
                                                                                  2003                2002
                                                                              (Unaudited)         (Unaudited)
                                                                          ----------------------------------------
                                                                                             $
                                                                          ----------------------------------------
<S>                                                                             <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net gain / (loss) for the period .......................................        78,250,813      (429,128,742)
Adjustments to reconcile net gain (loss) to net cash provided by
  operating activities:
   Accrued income tax...................................................        24,996,879      (251,784,082)
   Depreciation and disposal of fixed assets............................       113,728,245        149,033,015
   Goodwill and intangible assets amortization..........................         3,918,452         88,374,521
   Equity in the (gains) losses of affiliated companies.................       (1,955,423)       (21,233,135)
   Loan restatement ....................................................         2,367,252         19,979,052
   Interest accrued on financial liabilities and acquisition of cable...       143,077,995        190,681,045
   Result from advanced repurchase of negotiable obligations............                 -      (420,871,431)
   Result from restatement of negotiable obligations....................     (280,530,010)      1,002,803,860
   Minority interest in results of consolidated subsidiaries............           531,652          8,451,925
   Provision for lawsuits and contingencies.............................         1,541,363            433,251
   Exchange difference in advances on purchase of investments...........                 -          3,062,152
   Result of exposure to inflation from bank and financial debt and
   acquisition related debt in Argentine pesos .........................            33,423       (61,697,669)
   Result of sale of long-term investments..............................                 -           (25,168)
   Allowance for impairment of goodwill.................................                 -          4,979,891
   Result from holding of long-term investments.........................             1,898           (27,150)
   Income tax paid......................................................       (6,167,068)        (5,893,712)
Decrease (increase) in assets
   Trade receivables....................................................        11,779,120         44,403,334
   Other current assets.................................................         (367,692)         51,326,850
   Other non-current assets.............................................         3,462,236         11,918,398
   Receivables from related parties.....................................           461,290          4,098,818
Increase (decrease) in liabilities
   Debt with related parties............................................         (434,149)        (1,215,889)
   Other current and non-current liabilities............................       (6,447,051)        (1,469,075)
   Accounts payable and accrued liabilities.............................      (24,451,189)      (132,815,046)
   Payroll and social security..........................................           520,961       (11,091,577)
   Current and non-current taxes payable................................       (2,728,233)       (35,879,827)
   Provision for lawsuits and contingencies.............................       (1,138,629)       (29,671,210)
   Temporary translation differences ...................................         3,630,675        (5,258,586)
                                                                          ----------------------------------------
Cash provided by operations.............................................        64,082,810        171,483,813
                                                                          ----------------------------------------
CASH FLOWS FROM INVESTMENT ACTIVITIES

Purchases of property and equipment net of proceeds from sales and
  disposals.............................................................      (11,740,288)        (8,001,982)
(Acquisitions)/Sales of cable systems and subscribers and (increase)
  decrease in goodwill and intangible assets............................       (3,442,613)          (899,308)
                                                                          ----------------------------------------

Cash used in investment activities......................................      (15,182,901)        (8,901,290)
                                                                          ----------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Increase in acquisition related debt....................................                 -            160,036
Repayments of acquisition related debt..................................       (2,230,403)        (3,590,787)
Repayments of bank loans  ..............................................                 -      (249,065,329)

Decrease of minority interest in consolidated subsidiaries..............         (828,604)        (3,767,185)
                                                                          ----------------------------------------
Cash used in financing activities.......................................       (3,059,007)      (256,263,265)
                                                                          ----------------------------------------
INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS......................        45,840,902       (93,680,742)
Cash and cash equivalents at the beginning of period....................       107,023,972        188,352,843
                                                                          ----------------------------------------

CASH AND CASH EQUIVALENTS AT THE END OF PERIOD .........................       152,864,874         94,672,101
                                                                          ========================================

        The accompanying notes and exhibit are an integral part of these
              unaudited interim consolidated financial statements.
</TABLE>
<PAGE>


Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
      (For the nine-month period ended September 30, 2003 and comparatives)
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)

NOTE 1 - BUSINESS AND FORMATION OF THE COMPANY

(a) Business

Multicanal S.A. (the "Company" or "Multicanal"), an Argentine corporation formed
on July 26, 1991, is in one segment of business as owner and operator of cable
television systems.

Since 1994, the Company has made significant investments, initially in the
acquisition of cable systems and their subsequent development and expansion.
These investments have been substantially financed by loans from financial
institutions and former owners of certain acquired cable systems, as well as
shareholders' contributions.

(b) Formation of the Company

On January 1, 2001 the Company carried out a business reorganization process
through which it absorbed Plataforma Digital S.A., Red Argentina S.A., Radio
Satel Sociedad Anonima, Cable Espacio del Buen Ayre S.A., Video Cable Norte
S.A., Television por Cable S.A. and Cable Vision Corrientes Sociedad Anonima,
which were dissolved without being liquidated. In its capacity as the absorbing
company, the Company continued with the operations of the absorbed companies. As
a result of the merger, the Company increased its capital stock by $ 867,810,
i.e. from $365,953,227 to $ 366,821,037, through the issuance of 867,810
ordinary, nominal and non-endorsable Class A shares of $ 1 par value and 5 votes
each, delivered to Grupo Clarin S.A. in lieu of 16,303,000 ordinary, nominal and
non-endorsable shares held in Plataforma Digital S.A.

As the Company is a publicly held corporation, on April 11, 2001 an application
was filed with the Comision Nacional de Valores (National Securities Commission
or the "CNV") for administrative approval of such business reorganization
process, as required by applicable regulations. After obtaining evidence of
registration of the reorganization procedures, the CNV will submit the file to
the Superintendency of Corporations for registration.


<PAGE>


Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)


NOTE 2 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

2.1. Basis of presentation of the unaudited interim consolidated financial
statements

The unaudited interim consolidated financial statements include the accounts of
Multicanal and its majority owned subsidiaries. All material intercompany
balances, transactions and profits have been eliminated. Except as explained
below, the equity method is used to account for investments in affiliates in
which the Company has an ownership interest between 20% and 50%. Investments in
affiliates in which the Company has an ownership interest of less than 20% are
accounted for under the cost method.

The unaudited interim consolidated financial statements include accounts of
Multicanal and the following subsidiaries:

                                              % of capital and votes held by
                                                        Multicanal
                                            -----------------------------------
                                              September 30,     December 31,
                                            ----------------------------------
                                                   2003            2002
                                            ----------------------------------
AVC Continente Audiovisual S.A............          90.00            90.00
CV Berazategui S.A........................          70.00            70.00
Delta Cable S.A...........................          84.00            84.00
San Lorenzo TV Cable S.A..................         100.00           100.00
TV Cable San Francisco S.A................         100.00           100.00
Telesur Teledifusora Rio Cuarto S.A.......         100.00           100.00
Televisora Privada del Oeste S.A..........          51.00            51.00
Pem S.A...................................         100.00           100.00
Bridge Management Holdings Corp. (2)......              -           100.00
La Capital Cable S.A......................          50.00            50.00
Chaco Cable Color S.R.L. (1)..............         100.00           100.00
Teledifusora San Miguel Arcangel S.A......          50.10            50.10
Tevemundo S.A.............................         100.00           100.00
Cable Imagen S.R.L. (1)...................         100.00           100.00
Television Dirigida S.A.E.C.A.............          89.39            89.39
Orange Television Productions S.A.........         100.00           100.00
Cablepar S.A..............................         100.00           100.00
Cablevision Comunicaciones S.A.E.C.A......          89.81            89.81
Tres Arroyos Televisora Color S.A. .......          69.13            67.20
Wolves Television Sociedad Anonima........         100.00           100.00
Adesol S.A................................         100.00           100.00
Cable Video Sociedad Anonima..............         100.00           100.00
Dorrego Television S.A....................         100.00           100.00
Cable Video Sur S.R.L.....................         100.00           100.00

(1) Companies in the process of being transformed from a S.R.L. to a S.A.
(Corporation).
(2) A company dissolved as from August 25, 2003.

The interim financial data as of September 30, 2003 and for the nine-month
periods ended September 30, 2003 and 2002 is unaudited; however, in the opinion
of the Company, the interim data includes all adjustments, consisting only of
normal recurring adjustments, necessary for a fair statement of the results for
the interim periods. The results for the nine-month periods ended September 30,
2003 and 2002 do not necessarily reflect a proportion of the Company's results
for the full years.

2.2. Issue of new technical pronouncements

The Professional Council in Economic Sciences of the Autonomous City of Buenos
Aires ("CPCECABA") approved Technical Pronouncements Nos. 16 "Conceptual
framework of the professional accounting standards"; N(degree) 17: "Professional
accounting standards: development of matters of general application", N(degree)
18: "Professional accounting standards: development of certain matters of
specific application", N(degree) 19 "Changes to Technical Pronouncements Nos. 4,
5, 6, 8, 9, 11 and 14", and No. 20 "Financial derivatives and hedging
operations" through Resolutions CD 238/01, CD 243/01, CD 261/01, CD 262/01 and
CD 187/02, respectively. The mentioned technical pronouncements and amendments
are applicable to years commenced on July 1, 2002, except for Technical
Pronouncement No. 20, which is applicable to years commenced as from January 1,
2003.

Furthermore, the CNV has endorsed the mentioned Technical Pronouncements,
incorporating certain amendments, establishing that they are applicable to
fiscal years commencing on or after January 1, 2003.

The main amendments to Argentine GAAP resulting from the adoption of the new
technical pronouncements, are as follows:

o    Incorporation of specific guidelines for making comparison with recoverable
     values, especially the estimate of undiscounted cash flow to compare the
     value of fixed assets, intangible assets and goodwill against their
     recovery value.

o    Changes in the method for translation of financial statements of foreign
     subsidiaries stated in foreign currency.

o    Mandatory application of the deferred tax method for recognition of income
     tax.

o    Adding disclosure to the financial statements, including earnings per share
     and the comparative information to be presented.

o    No amortization of goodwill having unspecified useful life.

The following table provides a detail of prior years' adjustments derived from
application of the new accounting standards:

<TABLE>

                                              Effect on accumulated
                       Item                results at the beginning of   Effect on the result at September
                                                       year                    30, 2002 (comparative)
------------------------------------------------------------------------------------------------------------
<S>                                                   <C>                              <C>
Application of the deferred tax method                339,768,106                      256,977,781
Changes to the valuation of liabilities
generated by labor costs                               (3,175,824)                       1,125,905
                                           -----------------------------------------------------------------
Total                                                 336,592,282                      258,103,686
                                           =================================================================
</TABLE>

Pursuant to the new technical pronouncements, there are certain transitional
rules that enable, and in certain cases require, prospective application of
valuation and disclosure criteria contained in those rules. The transition rules
applied by the Company, which affect the comparability of the financial
statements, are as follows:

o    No adjustments were made to the initial balances under the new guidelines
     established to determine the recoverable values of assets.

o    The Company's balances of intangible assets and goodwill as of December 31,
     2002 having unspecified useful lives were not corrected and were not
     amortized.

o    As from January 1, 2003, we have applied the new methods for translation of
     financial statements of foreign subsidiaries stated in foreign currencies.

2.3. Recognition of the effects of inflation

The unaudited interim consolidated financial statements were prepared in
constant units of currency, reflecting the overall effects of inflation through
August 31, 1995. As from that date, in accordance with professional accounting
standards and the requirements of the control authorities, restatement of the
financial statements was discontinued until December 31, 2001. As from January
1, 2002, in accordance with Resolution No.3/2002 issued by CPCECABA and the
Resolution No. 415/02 issued by CNV, recognition of the effects of inflation has
been reestablished, considering that the accounting measurements restated by
changes in the purchasing power of the currency until August 31, 1995, as well
as those arising between that date and December 31, 2001, are stated in currency
as of the latter date.

On March 25, 2003, the National Executive Branch issued Decree No. 664 which
establishes that the financial statements for years ending as from that date
should be stated in nominal currency. Consequently, in accordance with
Resolution No. 441/03 issued by the CNV, the Company discontinued the
restatement of its financial statements as from March 1, 2003. This criterion is
not in line with prevailing professional accounting standards. There was a 2.1%
deflation during the period from March 1 to September 30, 2003.

The company has followed the method of restatement established by Technical
Pronouncement No. 6 of the Argentine Federation of Professional Councils in
Economic Sciences, including the modifications made by Technical Pronouncement
No. 19 of that organization, in turn approved and modified by Pronouncement CD
262/01 of the Professional Council in Economic Sciences of the Autonomous City
of Buenos Aires.

2.4.   Generally Accepted Accounting Principles

The unaudited interim consolidated financial statements have been prepared in
accordance with Argentine Generally Accepted Accounting Principles ("GAAP") and
the requirements of the CNV and are presented in Argentine pesos ("Ps.").
Additionally, certain reclassifications and additional disclosures have been
included in these unaudited interim consolidated financial statements in order
to conform more closely to the form and content required by US GAAP. These
unaudited interim consolidated financial statements do not include all the
additional disclosures required by the US Securities and Exchange Commission
("SEC") or US GAAP.

Accounting principles generally accepted in Argentina require companies with
controlling financial interest in other companies to present both parent
company, where investments in subsidiaries are accounted for by the equity
method, and consolidated financial statements as primary and supplementary
information, respectively. Because of the special purpose of these unaudited
interim consolidated financial statements, parent company financial statements
are not included. This procedure has been adopted for the convenience of the
reader of the financial statements.

2.5.  Comparative financial statements

Balances at December 31, 2002 and for the period ended on September 30, 2002,
which are shown in these unaudited interim consolidated financial statements for
comparative purposes, result from restating the amounts in the financial
statements at those dates following the guidelines indicated in Note 2.3.

2.6.  Valuation criteria

The principal valuation criteria used in the preparation of these unaudited
interim consolidated financial statements are as follows:

(a) Cash and Banks

Cash on hand was recorded at face value.

(b) Foreign currency

Assets and liabilities denominated in foreign currency are presented at the
nominal value of the foreign currency translated to Argentine pesos at
period-end exchange rates.

The financial debt incurred by the Company in the issuance of negotiable
obligations has been valued according to a conservative criterion, as mentioned
in the preceding paragraph. Notwithstanding this, the Company reserves the right
to consider that debt pesified, as stated in its submission of the legal
proceeding to seek approval of the acuerdo preventivo extrajudicial (the "APE")
(See Note 13).

(c) Short-term investments

Time deposits were valued according to the amount deposited at the time of the
transaction plus accrued financial interest based on the internal rate of return
determined at that time. Mutual investment funds were valued at their quotation
value at each period-end.

(d) Trade receivables and accounts payable

Trade receivables and accounts payable were valued at the estimated cash value
at the time of the transaction plus interest and implicit financial components
accrued based on the internal rate of return determined at such time.

Trade receivables include an allowance for doubtful accounts, which is
considered to be sufficient to absorb future losses due to uncollectible loans.

(e) Financial receivables and payables

Financial receivables and payables were valued based on the sums of money
disbursed and collected, respectively, plus financial results accrued based on
the rate estimated at that time.

(f) Other receivables and payables

Sundry receivables and payables were valued based on the best estimates of the
amounts receivable and payable, respectively.

(g) Long-term investments

Long-term investments in subsidiaries and related companies were valued by the
equity method of accounting.

The professional accounting standards used by the subsidiaries and related
companies for the preparation of its financial statements are the same as those
used by the Company. In the event of differences, the corresponding adjustments
were made.

Foreign companies: Cable Vision Comunicaciones S.A.E.C.A., Television Dirigida
S.A.E.C.A., Orange Television Productions S.A., Cablepar S.A. and Adesol S.A.
were classified as not integrated with the operations of the Company as these
companies generate revenue, incur expenses and obtain financing in their
countries of incorporation. On October 1, 2003, Orange Television Productions
S.A. and Cablepar S.A. merged into Cable Vision Comunicaciones S.A.E.C.A.

On August 25, 2003, the controlled company Bridge Management Holdings Corp. was
dissolved and, therefore, its assets and liabilities were assigned to
Multicanal, as its sole shareholder. Until August 25, 2003 the operations
carried out by Bridge Management Holdings Corp. were recognized on a
consolidated basis with the Company's operations, as established by Technical
Pronouncement No. 18.

The financial statements of the foreign companies that are not integrated, were
translated into pesos at the rates of exchange prevailing at the end of the
period. The exchange differences generated by that translation were charged to
"Temporary translation differences" between liabilities and shareholders' equity
and totaled $ 1,954,271 at September 30, 2003.

Long-term investments in companies in which no significant control or influence
is exercised were valued at their restated acquisition cost following the
guidelines mentioned in Note 2.3.

(h) Property and equipment

Property and equipment were valued at restated acquisition cost following the
guidelines indicated in Note 2.3., net of accumulated depreciation.

Depreciation was calculated by the straight-line method based on the estimated
useful lives of the assets, using annual rates sufficient to extinguish asset
values by the end of their useful lives.

Aggregate assets value does not exceed their economic value to the business at
the end of the period.

(i) Intangible assets

Intangible assets are basically represented by exploitation rights, concessions,
purchase value of the subscriber portfolio, etc. and were valued at restated
cost following the guidelines indicated in Note 2.3., net of accumulated
amortization.

Amortization was computed by the straight-line method, based on an estimated
useful life of between 5 and 20 years.

Aggregate value of intangible assets does not exceed their estimated recoverable
value at the end of the period.

(j) Goodwill

Goodwill represents the higher value disbursed on the corresponding proportional
equity value of the investments. Goodwill was restated following the guidelines
indicated in Note 2.3.

Until December 31, 2002, amortization was computed over twenty years as from the
month of origin. As from January 1, 2003, the Company adopted the criterion of
discontinuing amortization applying the criterion established by Technical
Pronouncement No. 17, as it considered it had unspecified useful life directly
related to the Company's business.

The Company regularly evaluates goodwill for recoverability based on estimates
and the evaluation of available information at the date of issue of the
financial statements. It is estimated that the aggregate value of goodwill as of
September 30, 2003, net of the provisions recorded, is lower than recoverable
value.

(k) Income Tax

The Company has recognized the charge for income tax by the deferred tax
liability method, recognizing the temporary differences between the tax bases of
assets and liabilities and their carrying amounts.

To determine deferred tax assets and liabilities the tax rate expected to be in
effect at the time of reversal or use has been applied to the temporary
differences identified and the tax loss carryforwards, observing the regulations
in effect at the date of issue of these unaudited interim consolidated financial
statements.

Since it is unlikely that future taxable income will absorb part of net assets
timing differences and tax loss carryforwards, the Company has recorded an
impairment on net asset timing differences and has not recognized the tax loss
carryforwards that it estimates will not be absorbed.

As established by CNV regulations, deferred tax assets and liabilities were not
discounted. This criterion is not in line with the accounting standards in force
in the Autonomous City of Buenos Aires, which require that those balances be
discounted.

(l) Minimum notional income tax

The Company calculates minimum notional income tax by applying the current rate
(1%) on computable assets at the end of the year. This tax complements income
tax. The tax obligation of the Company during each year will be determined by
the higher of the two taxes. However, if in a given year minimum notional income
tax exceeds income tax, that amount in excess can be computed as payment on
account of income tax determined in the following ten years.

In May 2001 the Company was included in the register of beneficiaries of the
agreements to improve competitiveness and employment (Decree No. 730/01). For
this reason, the Company was exempt from this tax until December 31, 2002.

(m) Provision for lawsuits and contingencies

A provision has been set up to cover potential labor, commercial, tax and other
types of contingencies that could generate liabilities for the Company. The
opinion of the Company's legal counsel has been taken into account for purposes
of calculation of the amount and likelihood of occurrence.

(n) Shareholders' equity

These accounts have been restated on a constant Argentine pesos basis (included
in Adjustments to capital account) (Note 2.3.). Adjustments to capital and
additional paid-in capital may be used to absorb accumulated deficits or to
increase capital at the discretion of the shareholders. These amounts cannot be
distributed in the form of cash dividends.

The "share capital" account has been stated at its historical nominal value. The
difference between the capital stock stated in constant currency and the capital
stock stated in historical nominal value has been disclosed under the
"adjustments to capital" account, in the shareholders' equity.

(o) Recognition of revenues

Revenues are recognized on an accrual basis, including revenues from
subscriptions, which are recorded in the month the service is rendered. The
Company's revenues are presented net of the allowance for doubtful accounts.

(p) Selling and marketing expenses

Selling and marketing expenses are expensed as incurred.

(q) Programming rights

Programming rights pending invoicing at the period-end are estimated on the
basis of existing agreements and other judgment criteria at that date.

(r) Employee severance indemnities

Severance pay is expensed at the time of payment.

(s) Accounting estimates

The preparation of the financial statements requires management to make
estimates and assumptions which affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the
balance sheet dates, and the reported amounts of revenues and expenses during
the reporting years. Actual results may differ from these estimates.

<PAGE>

NOTE 3 - ANALYSIS OF CERTAIN CONSOLIDATED BALANCE SHEET AND STATEMENT OF
          OPERATIONS ACCOUNTS

                                        September 30,      December 31,
                                      -------------------------------------
                                            2003               2002
                                         (Unaudited)
                                      -------------------------------------
CONSOLIDATED BALANCE SHEET                               $
                                      -------------------------------------
CURRENT ASSETS
(a)  Short-term investments
       Money market instruments.......       36,816            57,020
       Time deposits..................        1,644         1,378,244
       Other..........................      746,104            20,338
                                      ------------------------------------
                                            784,564         1,455,602
                                      ====================================
(b) Trade receivables
      From subscriptions..............   24,484,417        29,423,035
      From advertising................    8,216,956         9,406,832
      Notes receivable................       25,014           252,035
      From new businesses.............      957,104         1,941,353
      Credit cards....................    3,162,821         2,069,571
      From assurance..................    3,007,718        10,806,966
      Other...........................      388,696           285,151
    Allowance for doubtful
      accounts (Note 6 (a))
      From subscriptions..............  (20,568,873)      (22,251,308)
      From advertising................   (5,981,276)       (6,437,303)
      From new businesses.............     (378,488)         (403,123)
                                      ------------------------------------
                                         13,314,089        25,093,209
                                      ====================================
(c) Other
      Advances to suppliers...........      701,059         1,115,208
      Receivables from minority
      shareholders....................      502,504         2,779,965
      Tax advances....................    3,468,731         7,324,228
      Deposits in guarantee...........      546,982           559,157
      Other receivables...............   12,644,872         9,442,924
      Debtors in litigation...........          810            11,435
      Prepaid expenses................    6,789,037        10,007,711
      Advances to employees...........      361,497           532,765
      Judicial deposits ..............   11,974,554         3,006,888
      Other...........................    7,695,957         3,546,654
                                      ------------------------------------
                                         44,686,003        38,326,935
                                      ====================================


<PAGE>


Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)

<TABLE>
                                                                   September 30,      December 31,
                                                                       2003               2002
                                                                    (Unaudited)
                                                                 -------------------------------------
                                                                                   $
                                                                 -------------------------------------
<S>                                                                   <C>                <C>
NON-CURRENT ASSETS
(d) Other
    Prepaid expenses............................................      23,431,650         26,316,971
    Net deferred tax assets.....................................     316,398,407        337,819,328
    Tax advances................................................       2,564,982            225,219
    Deposits in guarantee.......................................         159,010                353
    Other.......................................................               -          3,212,636
                                                                 -------------------------------------
                                                                     342,554,049        367,574,507
                                                                 =====================================

(e) Long-term investments
    Investments in companies carried under the equity
    method (Note 10)............................................       7,779,199          6,951,016
    Advances for the purchase of companies......................       6,811,209          7,727,833
    Provision for recovery of investments (Note 6 (d))..........      (6,474,500)        (7,576,714)
    Investments in companies carried at cost ...................         206,492            204,587
                                                                 -------------------------------------
                                                                       8,322,400          7,306,722
                                                                 =====================================
(f)  Goodwill
     Original Value.............................................   2,595,119,998      2,646,206,514
     Accumulated amortization ..................................    (849,517,633)      (847,639,129)
                                                                 -------------------------------------
                                                                   1,745,602,365      1,798,567,385

     Allowance for impairment of Goodwill (Note 6 (e)).........     (574,158,802)      (625,198,981)

                                                                 -------------------------------------
                                                                   1,171,443,563      1,173,368,404
                                                                 =====================================
CURRENT LIABILITIES
(g) Short-term bank and financial debt
    Overdraft facilities........................................          57,144             57,144
    Corporate Bonds
       Capital..................................................   1,480,388,580      1,724,139,310
       Interests payable........................................     349,419,530        245,467,378
    Loans
       Capital..................................................      44,601,647         44,930,773
       Interests payable and restatements.......................      26,399,714         21,320,282
                                                                 -------------------------------------
                                                                   1,900,866,615      2,035,914,887
                                                                 =====================================
(h)  Other
     Other provisions...........................................       1,006,519          7,841,415
     Debt with minority shareholders............................         244,646            472,393
     Dividends payable..........................................       2,199,364          2,285,825
     Sundry creditors...........................................         375,494            315,292
     Other......................................................       2,928,209          2,276,300
                                                                 -------------------------------------
                                                                       6,754,232         13,191,225
                                                                 =====================================



                                                                   September 30,      December 31,
                                                                        2003              2002
                                                                    (Unaudited)
                                                                 -------------------------------------
                                                                                   $
                                                                 -------------------------------------
NON-CURRENT LIABILITIES
 (i) Other
     Investments in companies carried under the equity method
      - Fintelco S.A. (Note 10)..................................     18,330,982         19,465,318
     Other.......................................................        257,117            257,117
                                                                 -------------------------------------
                                                                      18,588,099         19,722,435
                                                                 =====================================


                                                                            September 30,
                                                                 -------------------------------------
                                                                        2003              2002
                                                                    (Unaudited)        (Unaudited)
                                                                 -------------------------------------
                                                                                   $
                                                                 -------------------------------------
CONSOLIDATED STATEMENT OF OPERATIONS
(j)  Net revenues
     Gross sales
      From subscriptions..........................................   340,421,694        482,916,165
      From advertising............................................     7,176,526          8,128,947
      Other.......................................................    28,567,967          5,217,982
    Allowance for doubtful accounts
      From subscriptions.........................................     (2,330,007)       (32,022,015)
      From advertising...........................................         (9,445)        (1,086,557)
                                                                 -------------------------------------
                                                                     373,826,735        463,154,522
                                                                 =====================================
(k) Other non-operating income / (expenses), net
    Employee's dismissals........................................              -               (884)
    Severance payments collected.................................      1,571,916                  -
    Provision for lawsuits and contingencies.....................     (1,541,363)          (433,251)
    Uncollectibility of other receivables........................        (12,229)           (41,836)
    Gain on sale of long term investment.........................              -             25,168
      Other......................................................      6,114,452          1,886,172
                                                                 -------------------------------------
                                                                       6,132,776          1,435,369
                                                                 =====================================
</TABLE>

<PAGE>
Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)

<TABLE>

NOTE 4 - PROPERTY AND EQUIPMENT

                                                                    September 30, 2003
                                        ---------------------------------------------------------------------------
                                                                  Accumulated                            Assets
                                            Original value        depreciation       Net book value    lives years
                                        ---------------------------------------------------------------------------
                                             (Unaudited)          (Unaudited)          (Unaudited)
                                        -------------------------------------------------------------
<S>                                       <C>               <C>                     <C>                <C>
Installations, external wiring and
  transmission equipment.........              1,412,814,551     (1,051,042,835)         361,771,716        10
Properties.......................                121,071,339        (43,072,490)          77,998,849        50
Computer equipment...............                 63,841,824        (58,068,715)           5,773,109         5
Furniture, fixtures and tools....                 53,345,480        (49,350,229)           3,995,251        10
Vehicles.........................                 29,806,392        (27,548,285)           2,258,107         5
Materials, net of provision for
  obsolescence of materials......                 57,469,731                   -          57,469,731         -
Work in progress.................                  8,603,220                   -           8,603,220         -
Advances to suppliers............                  3,567,620                   -           3,567,620         -
                                        --------------------- ------------------- -------------------
         Total...................              1,750,520,157     (1,229,082,554)         521,437,603
                                        ===================== =================== ===================


                                                                    December 31, 2002

                                        ---------------------------------------------------------------------------
                                                                  Accumulated                            Assets
                                            Original value        depreciation       Net book value    lives years
                                        ---------------------------------------------------------------------------
                                                                         $
                                        -------------------------------------------------------------
Installations, external wiring and             1,413,781,113       (961,281,366)         452,499,747        10
transmission equipment...........
Properties.......................                120,442,846        (38,468,802)          81,974,044        50
Computer equipment...............                 64,132,624        (54,241,067)           9,891,557         5
Furniture, fixtures and tools....                 53,349,165        (48,136,140)           5,213,025        10
Vehicles.........................                 30,293,201        (26,497,770)           3,795,431         5
Materials, net of provision for
  obsolescence of materials......                 61,875,704                   -          61,875,704         -
Work in progress.................                  6,644,528                   -           6,644,528         -
Advances to suppliers............                  2,803,861                   -           2,803,861         -
                                        -------------------- -------------------- -------------------
         Total...................              1,753,323,042     (1,128,625,145)         624,697,897
                                        ==================== ==================== ===================

The consolidated depreciation of property and equipment for the nine-month periods ended September 30, 2003 and 2002 amounted to
Ps. 113,728,245 and Ps 149,033,015, respectively.
</TABLE>


<PAGE>


Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)

<TABLE>

NOTE 5 - INTANGIBLE ASSETS

                                                                September 30, 2003
                                        ---------------------------------------------------------------
                                                                    Accumulated
                                            Original value         amortization       Net book value
                                        ----------------------- -------------------- ------------------
                                              (Unaudited)            (Unaudited)         (Unaudited)
                                        ----------------------- -------------------- ------------------
<S>                                         <C>                  <C>                 <C>
Purchased subscribers.................          27,678,117           (10,854,862)        16,823,255
Others................................          48,345,693           (29,131,834)        19,213,859
                                        ----------------------- -------------------- ------------------
         Total........................          76,023,810           (39,986,696)        36,037,114
                                        ======================= ==================== ==================

                                                                December 31, 2002
                                         ---------------------------------------------------------------
                                                                     Accumulated
                                           Original value           amortization       Net book value
                                         ---------------------------------------------------------------
                                                                        $
                                         ---------------------------------------------------------------
Purchased subscribers.................          27,678,114            (9,782,304)        17,895,810
Others................................          45,893,771           (26,726,926)        19,166,845
                                         ----------------------- -------------------- ------------------
         Total........................          73,571,885           (36,509,230)        37,062,655
                                         ======================= ==================== ==================

The consolidated amortization of goodwill and intangible assets for the nine-month periods ended September 30, 2003 and 2002
amounted to Ps 3,918,452 and Ps. 88,374,521, respectively.


</TABLE>


<TABLE>

NOTE 6 - ALLOWANCES AND CERTAIN PROVISIONS

(a)      Allowance for doubtful accounts

                                    September 30,  December 31,   September 30,  December 31,  September 30,   December 31,
                                    ----------------------------------------------------------------------------------------
                                        2003          2002           2003           2002          2003            2002
                                    (Unaudited)                  (Unaudited)                   (Unaudited)
                                    ----------------------------------------------------------------------------------------
                                         From subscriptions            From advertising             From new businesses
                                    ----------------------------------------------------------------------------------------
                                                                                $
                                    ----------------------------------------------------------------------------------------
<S>                                  <C>           <C>            <C>             <C>             <C>           <C>
Balance at the beginning of the
period /  year....................   22,251,308    47,429,544     6,437,303       9,496,992       403,123       1,711,321

Increase / (Decrease) (recorded
as loss)..........................    2,330,007    35,235,572         9,445       1,170,068             -        (402,963)

(Write-off) (*)...................   (4,012,442)  (60,413,808)     (465,472)     (4,229,757)      (24,635)       (905,235)
----------------------------------- ------------- ------------- --------------- ------------- --------------- --------------

Balance at the end of the period
/ year............................   20,568,873    22,251,308     5,981,276       6,437,303       378,488         403,123
                                    ============= ============= =============== ============= =============== ==============

(*) Includes result of exposure to inflation.
</TABLE>


<PAGE>


Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)

<TABLE>
(b) Provision for obsolescence of materials
                                                                          September 30,     December 31,
                                                                         ----------------------------------
                                                                              2003              2002
                                                                           (Unaudited)
                                                                         ----------------------------------
                                                                                         $
                                                                         ----------------------------------
<S>                                                                      <C>              <C>
Balance at the beginning of the period / year...........................    11,084,790       11,150,723
Decrease................................................................             -          (65,933)
                                                                         ----------------------------------
Balance at the end of the period / year.................................    11,084,790       11,084,790
                                                                         ================ =================

(c) Provision for lawsuits and contingencies
                                                                          September 30,     December 31,
                                                                         ----------------------------------
                                                                              2003              2002
                                                                           (Unaudited)
                                                                         ----------------------------------
                                                                                         $
                                                                         ----------------------------------
Balance at the beginning of the period / year...........................    18,495,701       52,313,401
Increase (recorded as loss).............................................     1,541,363        2,029,125
Decrease of provision (*)...............................................    (1,138,629)     (35,846,825)
                                                                         ----------------------------------
Balance at the end of the period / year.................................    18,898,435       18,495,701
                                                                         ==================================
(*) Includes result of exposure to inflation.


(d) Provision for recovery of investments
                                                                          September 30,     December 31,
                                                                         ----------------------------------
                                                                              2003              2002
                                                                           (Unaudited)
                                                                         ----------------------------------
                                                                                          $
                                                                         ----------------------------------
Balance at the beginning of the period / year...........................     7,576,714                -
(Decrease) / increase (recorded as loss) (*)............................    (1,102,214)       7,576,714
                                                                         ----------------------------------
Balance at the end of the period / year.................................     6,474,500        7,576,714
                                                                         ==================================
(*) Includes result of exposure to inflation and exchanges differences.


(e) Allowance for impairment of goodwill
                                                                          September 30,     December 31,
                                                                         ----------------------------------
                                                                              2003              2002
                                                                           (Unaudited)
                                                                         ----------------------------------
                                                                                          $
                                                                         ----------------------------------
Balance at the beginning of the period / year...........................   625,198,981      328,492,942
Increase recorded as loss...............................................             -      315,044,678
Goodwill amortization...................................................             -      (18,338,639)
Temporary translation differences.......................................   (51,040,179)               -
                                                                         ----------------------------------
Balance at the end of the period / year.................................   574,158,802      625,198,981
                                                                         ==================================
</TABLE>

<PAGE>


Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A.
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)

NOTE 7 - BANK AND FINANCIAL DEBT

In addition to the financial loans with local financial entities, which have
been converted into pesos and restated through application of the Reference
Stabilization Coefficient ("CER"), the Company's financial debt is as follows:

(a) US$ 125 million 9 1/4 % Notes due 2002 and US$ 125 million 10 1/2 % Notes
due 2007

On January 28, 1997, the Board of Directors of Multicanal approved the issuance
of two series of securities, the US$ 125 million 9 1/4 % Notes due 2002 and the
US$ 125 million 10 1/2 % Notes due 2007 (collectively, the "Notes"), in each
case interest to be paid semi-annually. The aggregate net proceeds of the issue
of the Notes due 2002 and the Notes due 2007 of US$ 244,882,500, together with
US$ 5,117,500 corresponding to cash generated by the operations, were used to
repay a US$ 200 million loan facility arranged by The Boston Investment Group
S.A., Banco Rio de la Plata S.A. and Galicia Capital Markets S.A. in 1995 (the
"1995 Loan Facility") and to refinance short-term bank debt and other
indebtedness. Appropriation to payment was effected on February 3, 1997.

The Notes due 2002 and the Notes due 2007 contained customary affirmative and
negative covenants, including, but not limited to, restrictions on the
incurrence of additional debt, creation of liens on assets, disposal of assets,
mergers and payments of dividends.

On July 2, 1997, the Notes due 2002 and the Notes due 2007 were registered with
the SEC, and the Company concluded exchange offers involving those obligations
on August 3, 1997 and September 4, 1998.

(b) Establishment of a Medium-Term Note Program of up to US$ 350,000,000

During the Ordinary Shareholders' Meeting held on April 4, 1997, the
Shareholders approved the establishment of a Medium-Term Note Program (the
"Program") for the issue of unsecured corporate debt, in different currencies,
provided that the maximum outstanding amount, after adding all series and
classes of notes issued under the Program, does not exceed US$ 350,000,000, or
an equivalent amount if any such issue is in another currency, at any time. On
May 8, 1997, the CNV approved the public offer of Corporate Bonds under the
abovementioned Program. On July 24, 1997, the abovementioned Program was
approved by the Buenos Aires Stock Exchange ("BCBA").

    (i)  Issue of US$ 150 million Series C 10 1/2 % Notes due 2018

    On March 10, 1998, the Board of Directors of Multicanal approved the terms
    and conditions for the issuance under the Program of US$ 150 million Series
    C 10 1/2 % Notes due 2018 (the "Series C Notes"). The Series C Notes will
    mature on April 15, 2018 and bear interest at the rate of 10 1/2 % payable
    semi-annually.

    The net proceeds received by the Company from the placement, amounting to
    approximately US$ 144.3 million, were used to refinance debt incurred by the
    Company in connection with the purchase of cable systems, short-term bank
    debt, other liabilities and costs and related expenses.

    The Series C Notes contain customary affirmative and negative covenants,
    which are similar to those mentioned for the issue of the Notes due 2002 and
    Notes due 2007.

    On September 4, 1998, the Series C Notes were registered with the SEC, and
    the Company's exchange offer related to the Series C Notes was concluded on
    October 6, 1998.

(c) Increase in the maximum amount of notes outstanding under the Medium-Term
Note Program

The Company's shareholders approved, at a self-summoned Unanimous Ordinary
Meeting held on November 24, 1997, an increase in the maximum aggregate amount
of notes outstanding under the Medium-Term Note Program by US$ 200,000,000 to
US$ 550,000,000. On December 2 and 22, 1998 and February 16, 1999, the CNV, the
BCBA and the over-the-counter market ("MAE"), respectively, approved the
abovementioned increase.

Subsequently, on January 19, 1999, the Company's shareholders approved an
additional increase in the maximum aggregate amount of notes outstanding under
the Medium-Term Note Program by US$ 500,000,000 to US$ 1,050,000,000. On March
31, April 5 and 13, 1999, the CNV, the BCBA and the MAE, respectively, approved
the abovementioned increase.

   (i) Issue of US$ 175 million Series E Notes due 2009

       In March 1999 the Board of Directors of Multicanal approved the terms and
       conditions for the issue of the Series E Notes under the Medium-Term Note
       Program.

       The principal amount of the Series E Notes totals US$ 175 million and
       matures on April 15, 2009. The Series E Notes are subject to early
       repayment, in whole or in part, at the option of holders, on April 15,
       2004. If a holder exercises its early repayment option, the Series E
       Notes will be repaid at a price equal to 100% of the principal amount
       plus interest accrued thereon and unpaid and additional amounts, if any,
       which could be claimed through the repayment date. The Notes bear
       interest at the rate of 13.125%, payable semi-annually.

       The net proceeds of the issue, which amounted to US$ 170.5 million, were
       used to refinance debt incurred by the Company in connection with the
       purchase of cable systems and other short-term financial liabilities.

       The listing and negotiation of the Series E Notes were authorized by the
       BCBA and the MAE on April 14 and 15, 1999, respectively.

       The Series E Notes contain customary affirmative and negative covenants,
       which are similar to those mentioned for the issue of the Notes due 2002
       and Notes due 2007.

       On September 13, 1999, the Series E Notes due 2009 were registered with
       the SEC, and the Company's exchange offer related to the Series E Notes
       was concluded on October 21, 1999.

  (ii) Issue of US$ 144 million Series J Floating Rate Notes due 2003

       On August 22, 2001, the Board of Directors of Multicanal approved the
       issue of US$ 144,000,000 of its Series J Floating Rate Notes under the
       Global Program for up to US$ 1,050,000,000.

       The Series J Notes were issued on August 24, 2001 in the amount of US$
       144 million, and the maturity date is August 22, 2003. The Series J
       Floating Rate Notes bear interest at the LIBO rate indicated for deposits
       in dollars on page "3,750" of the Telerate monitor plus 5 1/2 %. Interest
       is payable on a quarterly basis.

       On August 24, 2001 the Company issued the Series J Floating Rate Notes,
       which were exchanged for the Series G and Series I Notes (the maturity of
       which was extended until August 30, 2001 with the unanimous consent of
       their holders in connection with the issuance of the Series J Notes).
       Pursuant to the terms and conditions agreed upon, the Company paid US$
       20,000,000 in cash to the Series G and Series I holders to satisfy all of
       the Company's obligations corresponding to such Notes.

       Pursuant to the terms of the Series J Floating Rate Notes, the Company
       must comply with certain covenants, including, without limitation,
       obligations that restrict: (i) indebtedness; (ii) dividend payments or
       the making of certain restricted payments; (iii) the granting of certain
       pledges, and (iv) the sale of certain assets of the Company and certain
       of its subsidiaries. In addition, the Company agreed that its net debt
       (Bank and financial debts plus Acquisition-related debt less Cash and
       cash equivalents) would not exceed US$ 700,000,000, that it will not
       invest in fixed or capital assets in excess of US$ 40,000,000 during any
       12 month-period and that the balances resulting from the sale of its
       investment in DirecTV Latin America, LLC to Raven Media Investment, LLC
       would be applied to discharge financial debt.

Repurchases

During the last quarter of 2001 and in January 2002, the Company repurchased
notes issued by it for US$ 211,148,000, obtaining a discount with respect to the
face value of the Company's debt amounting to US$ 130,995,548. The result of
that purchase corresponding to the previous period amounted to $ 420,871,431,
which is recorded under Financial income (expenses) and holding results, net in
the unaudited interim consolidated statement of operations.

Deferred Payments

On February 1, 2002, the Company deferred the payment of principal and interest
on its 9 1/4 % Notes due 2002 and interest on its 10 1/2 % Notes due 2007 due to
the situation of the Argentine economy and the political and social crisis that
resulted from the economic, exchange and regulatory measures described in Note
12. Subsequently on February 26, 2002, the Company deferred the payment of
interest on its Series J Floating Rate Notes due 2003.

On April 15, 2002, the Company deferred payments of interest on its Series C 10
1/2 % Notes due in 2018, and its Series E 13.125% Notes due in 2009 due to the
worsening of the Argentine economic crisis.

On June 4, 2002, the Company announced the designation of JP Morgan Securities
Inc. as financial advisor, to assist it in designing alternative means of
discharging the deferred payments. As agreed, the fees and total costs in
relation to the restructuring process will depend on the result finally
achieved.


Restructuring process

As a result of the expiration of the existing Global Program, on January 22,
2003 the shareholders approved a new global program for the issuance of
unsecured negotiable obligations, in various currencies, for a maximum amount of
the equivalent of US$ 300,000,000 over a term of five years as from the date of
authorization of the program by the CNV. An application for public offer and
listing of the Global Program was filed with the CNV and the BCBA (Buenos Aires
Stock Exchange) on January 24, 2003, which is pending as of the date of issue of
these financial statements.

As a first stage in the financial debt restructuring process, on January 31,
2003 the Company launched an offer to purchase (the "Cash Tender Offer") its 9
1/4% Notes due 2002, 10 1/2% Notes due 2007, 13.125% Series E Notes due 2009,
Series C 10 1/2% Notes due 2018 and Series J Floating Rate Notes due 2003
(together, the "Existing Notes"), and other financial indebtedness (the "Bank
Debt" and together with the Existing Notes, the "Existing Debt") which was
successively extended until December 12, 2003.

On February 7, 2003, as a second stage of the restructuring process Multicanal
announced that it is soliciting (the "APE Solicitation") from holders of
Existing Debt powers of attorney in favor of an attorney-in-fact, to execute an
APE.

On March 26, 2003 the Company made certain modifications at the request of
certain creditors with whom the Company had agreed to sign supporting contracts
to obtain their agreement to the APE Solicitation.

On July 25, 2003 the Company publicly announced the modification of its Cash
Tender Offer (the "Cash Tender Offer", as amended, the "Cash Option
Solicitation") and the APE Solicitation as a result of the requests made by its
creditors, including an increase in the consideration offered to the holders of
the Existing Debt that participate in the APE Solicitation, modification of the
minimum participation requirements of the APE Solicitation, modification of
certain conditions precedent of the APE Solicitation and the Cash Option
Solicitation and inclusion of the cash payment pursuant to the Cash Option
Solicitation as an option in the APE Solicitation.

Upon approval by an Argentine commercial court of the APE, each of the holders
that participates in the Cash Option Solicitation will receive a cash payment of
US$ 300 for each US$ 1,000 of principal of Existing Debt tendered. Furthermore,
each holder that accepts the APE Solicitation will receive, for each U.S.$1,000
principal amount of Existing Debt tendered in connection with the APE
Solicitation, at its option, either:

         (i)   U.S.$1,050 principal amount of the Company's 10-Year Step-Up
               Notes (the "10-Year Notes") or

         (ii)  U.S.$440 principal amount of either (A) the Company's 7% 7-Year
               Notes (the "7- Year Fixed Rate Notes") or (B) the Company's
               7-Year Floating Rate Notes (the "7-Year FRNs", together with the
               7-Year Fixed Rate Notes, the "7-Year Notes", and the 7-Year Notes
               together with the 10-Year Notes, the "New Notes"), and 641 of the
               Company's class C shares of common stock (the "Class C Shares").

The Company will not pay any accrued and unpaid interest (including default
interest and additional amounts, if any) on the Existing Debt that is exchanged
or capitalized pursuant to the APE.

The Cash Option Solicitation and the APE Solicitation are subject to the terms
and conditions set out in the Cash Option Solicitation Statement and the Second
Supplement to Solicitation Statement, each dated February 7, 2003, amended and
supplemented by the Supplement, the Second Supplement and the Third Supplement
of the Invitation Document dated March 26, July 25 and August 22, 2003,
respectively.

The Company is seeking to (i) exchange approximately U.S.$76.5 million principal
amount of its Existing Debt for U.S.$80.3 million of 10-Year Notes, (ii)
exchange approximately U.S.$143.0 million principal amount of its Existing Debt
for U.S.$143.0 million of its 7-Year Notes and (iii) capitalize approximately
U.S.$181.9 million principal amount of its Existing Debt. The Company is seeking
to retire approximately U.S.$130 million pursuant to the terms of the Cash
Option Solicitation.

Since the Cash Option Solicitation and the APE Solicitation are not regulated by
applicable CNV and BCBA regulations, the Company has notified both restructuring
stages of the process of restructuring and its modifications, having filed the
corresponding documents and supplements that were prepared by the Company, as
well as the rest of the related documentation. These documents are currently at
the BCBA for consultation by the investing public.

On August 12, 2003, the Company initiated legal proceedings before the Federal
Court of Original Jurisdiction for Commercial Matters No. 4, Clerk Office No. 8,
requesting that Judge Fernando Ottolengui approve the proposed reorganization
plan and call a creditors' meeting, under the terms of Section 45 bis of Law
24,522. In compliance with the resolution issued by the presiding Judge, on
September 22, 2003 the Company called a meeting of holders of all series of
currently outstanding negotiable obligations to be held on December 10, 2003, at
12 p.m., at the Golden Center, Parque Norte, located at Av. Cantilo and Av.
Guiraldes s/n (1428) Ciudad Autonoma de Buenos Aires, with the following agenda:
1) Appointment of two persons to sign the minutes. 2) Consideration of the
proposal for the restructuring of outstanding negotiable obligations in order to
draw up a reorganization plan.

NOTE 8 - SHAREHOLDERS' CAPITAL

As a result of the incorporation of the equity of Plataforma Digital S.A.,
effective from January 1, 2001 (Note 1 b)), the capital stock of Multicanal, as
the absorbing company, was increased by Ps. 867,810, from Ps. 365,953,227 to Ps.
366,821,037, by the issue of 867,810 non-endorsable, registered, ordinary Class
A shares of Ps. 1 par value with five votes per share, which were delivered to
Grupo Clarin S.A. in exchange for the shares held by it in Plataforma Digital
S.A. This capital increase is pending registration.

The dissolution of Multicanal Holding LLC was registered with the Secretary of
State of the State of Delaware on June 2, 2003 in line with the Operating
Agreement signed at the time of the Company's creation, and its shareholders
contributed to Grupo Clarin S.A. the shares Multicanal Holding LLC held in the
Company.

Furthermore, on August 8, 2003, the Shareholders' Meeting of the Company
resolved to increase the corporate capital by $ 4,814,066, through the
capitalization of all irrevocable contributions recognized. Thus, the capital
was increased to $ 371,635,103 through the issuance of 2,629,140 ordinary
registered non-endorsable Class A shares with a par value of $1 each and
entitled to five votes per share, delivered to Grupo Clarin S.A., and 2,184,926
ordinary registered non-endorsable Class B shares with a par value of $1 each
and entitled to one vote per share, of which 654,438 correspond to Grupo Clarin
S.A. and 1,530,488, to Arte Grafico Editorial Argentino S.A. This capital
increase is pending registration.

As a result, the shares of the Company are currently held as follows:

<TABLE>
=========================================================================================================
                                                         Number of shares
                                        -----------------------------------------------------------------
              Shareholder                    Class A          Class B           Total        % Holding
---------------------------------------------------------------------------------------------------------
<S>                                       <C>               <C>              <C>             <C>
Grupo Clarin S.A.                         202,963,617       50,521,104(1)    253,484,721(2)     68.21
Arte Grafico Editorial Argentino S.A.               -      118,150,382       118,150,382        31.79
                                        -----------------------------------------------------------------
Total                                     202,963,617      168,671,486       371,635,103       100.00
=========================================================================================================
</TABLE>

(1)  On March 30, 2001, the Company's Board of Directors authorized the granting
     and registering of a pledge on 4,791,503 Class B shares owned by Grupo
     Clarin S.A., as collateral for Video Cable Comunicacion S.A.'s deferred
     taxes in the amount of Ps. 2,982,126 and Ps. 3,055,166 corresponding to
     investments made in Sierras de Mazan S.A. In addition, in line with the
     Administracion Federal de Ingresos Publicos (Tax Authority or the "AFIP")
     General Resolution No. 846, the Company set up a pledge in its favor on
     4,791,503 Class B shares as collateral with BankBoston N.A. in favor of the
     AFIP.

     On January 24, 2002 the Board of Directors of the Company authorized the
     creation and registration of a security interest on (i) 367,954 ordinary
     book entry Class B shares held by Grupo Clarin S.A. to secure tax deferrals
     for Ps. 463,620 made by Video Cable Comunicacion S.A. in Sierras de Mazan
     S.A.; (ii) 2,146,107 ordinary book entry Class B shares held by Grupo
     Clarin S.A. to secure tax deferrals for Ps. 2,704,095 made by Enequis S.A.
     in Sierras de Mazan; and (iii) 1,299,498 ordinary book entry Class B shares
     held by Grupo Clarin S.A. to secure Ps. 1,637,355, i.e. the total amount of
     the debt deferred by Cable Video Sociedad Anonima in Valle del Tulum. Those
     shares were pledged as collateral in favor of the AFIP through BankBoston
     N.A.


(2)  Of this holding, 40,094,948 ordinary Class A shares and 22,238,385 ordinary
     Class B shares are pledged in favor of Telefonica de Contenidos S.A.
     Unipersonal.

NOTE 9 - COMMITMENTS AND CONTINGENCIES

(a) Acquisition and sale of cable systems

(i) Acquisition of cable systems in Paraguay

On December 12, 1997, the Company entered into two agreements for the
acquisition of 14 cable systems (13 in Paraguay and 1 in Clorinda, Argentina).
The closing of the transaction was scheduled for November 15, 1997, which was
subject to the seller's compliance with certain conditions, including obtaining
various regulatory approvals from the government of Paraguay, which were
ultimately not obtained. The Company renegotiated the purchase of the
subscribers, and the assets and liabilities of the Paraguayan companies. So far,
US$ 2,300,000 corresponding to the payment on account of the total price has
been paid.

The final agreement was not signed due to the seller's failure to comply with
its obligations. The seller signed a promissory note amounting to US$ 2,300,000
and pledged the shares corresponding to certain TV systems in favor of the
Company to guarantee compliance with the conditions for the closing of the
transaction. As a result of the seller's non-compliance, the Company demanded
payment of the promissory note, but the seller brought a claim demanding
compliance with the agreement signed on December 12, 1997, reserving the right
to determine the amount of damages, and an injunction which was resolved by the
Paraguayan court in favor of the plaintiff. This measure prevents collection by
the Company of the promissory note amounting to US$ 2,300,000.

The Company requested that the judge hearing the case require the plaintiff to
pay court fees on the amount of the contract, and the Court granted the request
and suspended the court proceedings. Because the plaintiff had not paid the
court fees as ordered by the judge, the Company requested that the preliminary
injunction be suspended, the lawsuit be dismissed and the file be closed. The
Judge did not make a final determination but accepted the request for suspension
of the preliminary injunction.

Subsequently, the plaintiff paid the court fees but, case is pending because,
among other reasons, the Judge has not ordered the reopening of the case. Once
the case is reopened, the Company must answer the complaint and proceed with the
legal action.

On June 19, 2001, the seller communicated to the court the assignment of rights
and lawsuits in favor of Lisker S.A., for which court fees were paid. When the
Company was informed of this assignment, it filed an appeal challenging the
court's decision pursuant to which Lisker S.A. was assigned seller's rights, on
the grounds that the agreement had an intuitu personae nature, and that the
seller was restricted from assigning rights, according to the agreement. Through
a resolution dated August 17, 2001, the court approved the appeal and revoked
the rights assigned to Lisker S.A. That ruling was appealed by Lisker S.A.,
which filed an appeal of the dismissal. This appeal was also dismissed.
Subsequently, Lisker S.A. filed an appeal with the Supreme Court of Justice of
Paraguay claiming unconstitutionality. Once the complaint regarding the
unconstitutional nature of the measure had been replied to, the case was
submitted to the Attorney General for a ruling. To answer the requirement the
Attorney General asked for the file on the complaint because of refusal to
appeal, but as it has been mislaid at present the Civil and Commercial Court of
Appeal has not yet sent it. In view of the situation an application will be made
for the time periods to be extended and for a reply to the submission on the
action brought for lack of constitutionality.

On July 10, 2001 the court ordered that the evidence filed by the seller, which
it had obtained in Buenos Aires, be removed from the court file and returned to
it. The seller filed a motion to reverse this court decision and an appeal. On
July 24, 2001, the court rejected the motion and the appeal. The seller appealed
but the appeal was rejected by the Appellate Court in Civil and Commercial
Matters, Room 2, on August 13, 2001.

On September 17, 2001, the Company requested the lifting of the provisional
remedy, which restrains it from collecting the promissory note for US$ 2,300,000
drawn in the name of the seller. The Court lifted the injunction that had
prevented Multicanal from bringing legal action against the seller.

The Company is unable to assure that it will collect the amount due once the
injunction has been lifted.

(ii) Sale of assets and rights in DirecTV Latin America, LLC.

On August 24, 2001, the Company transferred all of its interests in DirecTV
Latin America, LLC and certain contractual rights related thereto to Raven Media
Investments, LLC, a company organized under the laws of the state of Delaware
and wholly-owned by Grupo Clarin S.A., for US$ 150,000,000.

The Company received the full purchase price upon the execution of the transfer
agreement.

Multicanal reserved the right, subject to certain conditions, to indirectly
repurchase the assets sold. This option expires by no later than November 10,
2003.

(iii) Tres Arroyos Televisora Color S.A. trusts

On September 7, 2001, a Trust Agreement was signed under which the minority
shareholders transferred all of their equity interests in Tres Arroyos
Televisora Color S.A., representing 38.58% of the stock capital, in favor of the
trustee, Mr. Jose Maria Saenz Valiente (h). Multicanal was appointed the trust
beneficiary so that the stock in trust is gradually transferred to it provided
it pays Ps. 42,876 per month to the trustee over a 10-year period. The trust
will be revoked if Multicanal were to fail to pay the consecutive monthly
installments.

Additionally, on the same date, September 7, 2001, a beneficial interest on the
shares of Tres Arroyos Televisora Color S.A., representing 38.58% of the
Company's capital stock and voting rights, was set up in favor of Multicanal,
for the earlier of 10 years or the Trust life.

As of September 2003, the trustee transferred 1,852 shares to Multicanal under
the Trust Agreement. The participations after the transfer are as follows:
Multicanal owns 16,592 shares representing 69.13% of the capital stock and
Fideicomiso Tres Arroyos Televisora Color S.A. owns 7,408 shares representing
30.87% of the capital stock.

(iv) Acquisition of Telemas S.A. Renegotiation of payment of the price balance

On May 2, 1997, through its wholly-owned subsidiary Adesol S.A., the Company
acquired 75% of Telemas S.A., a company that provides programming and management
services to UHF systems and another seven cable operators in Uruguay. On July
15, 1999 the Company established that Adesol S.A. would acquire the remaining
25% of Telemas S.A. and agreed to pay US$ 12.4 million in six half-yearly
installments, the first four of which were paid on December 15, 1999, June 15
and December 15, 2000 and June 15, 2001 (payment corresponding to December 31,
2001 had been made in advance). The amount of the final installment due on June
15, 2002 was renegotiated, being payable in 24 installments from July 2002. In
accordance with an addendum dated November 2002, the Company and Adesol S.A.
partially renegotiated their financing obligations with maturities from October
2002 through March 2003, reducing the amount of the installments and adding a
final installment corresponding to the difference. The restriction on the sale
of Adesol S.A. and Telemas S.A. will continue to be in effect until those
installments have been settled. On June 23, 2003 the Company and Adesol
renegotiated the financial obligations falling due in April 2003 to instead fall
due in December 2003, decreased the amount of the installments and added a final
installment for the difference which will fall due in August 2004.

(v) Acquisition of Dorrego Television S.A

Through the agreement entered into on October 15, 2002 in relation to the
purchase of the capital stock of Dorrego Television S.A. and Cable Video Sur
S.R.L., the Company assumed the outstanding obligations of the purchaser -
amounting to $ 250,000 - with the previous shareholders of Dorrego Television
SA. and agreed to settle that debt in 30 monthly installments using a formula
based on a basic subscription fee charged in Coronel Dorrego. On December 15,
2002 the Company entered into an agreement whereby it assumed the obligations of
the seller with the previous owners of Cable Video Sur SRL. The obligations of
the seller were secured with a pledge on 99% of the quotas of Cable Video Sur
S.R.L. The Company agreed to pledge the shares of Dorrego Television SA. in
exchange for the release of the pledge on the installments of Cable Video Sur
S.R.L. It was also agreed that the total payment of $ 829,641 would be made in
39 monthly installments and six semi-annual installments.

(b) Litigation

The Company is involved in litigation from time to time in the ordinary course
of business. In Management's opinion, the lawsuits in which the Company is
currently involved, individually and in the aggregate, are not expected to be
resolved for amounts that would be material to the Company's financial condition
or results of operations.

(c) Operating licenses

The Company's operating licenses, obtained from the Comite Federal de
Radiodifusion (Federal Broadcasting Committee or "COMFER"), have been generally
granted for a period of 15 years, with the option to extend the licenses for an
additional ten-year period, counted as from the expiration of the original term.
The Company has requested the extension of the term for several licenses. The
extension of the licenses is subject to approval by the COMFER. Although
management considers that the risk that the Company will be unable to renew its
licenses in the future remote, it cannot provide assurance that the Company will
obtain any such extensions.

(d) Pending approvals

The Company has applied for COMFER approval of several transactions, including
the various corporate reorganizations in which several operating subsidiaries
were merged into the Company, certain transfers and other acquisitions of cable
television companies. In addition, the Company has requested the COMFER to
approve the elimination of certain headends. Although most of these approval
petitions are pending, the Company expects to receive all such approvals in due
course. Notwithstanding the foregoing, the Company can give no assurance that
such approvals will be granted by the COMFER or any successor agency.

The merger-spin-off of Fintelco S.A., Video Cable Comunicacion S.A. ("VCC") and
CV Inversiones S.A., are pending approval by the IGJ.

The increase in capital stock resulting from the merger that will be deemed
effective as of January 1, 2001 is pending registration with the IGJ.
Furthermore, the reorganization processes carried out by the Company before the
merger are also pending registration.

(e) Claims by COMFER

(i) Administrative proceedings

The Company has taken part in a payment facilities regime established by
Government Decree 1201/98, as amended by Decrees 644/99 and 937/99, in order to
pay the penalties for violations of the broadcasting law that allegedly occurred
prior to December 9, 1999. This mechanism provides for: (i) an 85% reduction in
any fines in connection with these proceedings, and (ii) cash payments of the
amount to be determined, or crediting of the amount to TELAM S.A. for use in
public service campaigns run by the Federal Government. The COMFER notified the
Company, by means of Note 2872/02, that the "Amount payable" amounts to $
5,295,359. The Company intends to pay this amount by providing advertising.
However, because the "amount to be settled" that the Company was notified it
must pay was calculated by applying the previous regime on calculating penalties
approved by Resolutions Nos. 626/COMFER/98, 772/COMFER/98 and 609/COMFER/99, the
Company filed a request with the relevant authorities requesting recalculation
of the "amount to be settled" by applying the new regime approved by Resolution
No. 830/COMFER/2002 in effect since November 21, 2002, if it is more favorable
to the Company. This decision was based on the general legal principle which
establishes that the most favorable regulation is to be applied at the time of
setting a penalty.

On December 13, 2002 the Company took part in a new payment facilities regime
established by Decree 2362/02 of the National Government for the payment of
fines imposed on the Company or derived from non-compliance with broadcasting
regulations between January 1, 2001 and October 31, 2002, inclusive. Under this
regime, the following alternatives are available: (i) to make payment in cash,
or (ii) to apply the resulting amounts in favor of the National Secretariat of
Communication Media and the Comfer for campaigns for the public interest
organized by the National Government. It is the Company's intention to pay the
fines by providing advertising time in future broadcasts.

(ii) Demand for payment from Vidycom S.A.

The COMFER filed a claim whereby it demanded payment from Vidycom S.A.
("Vidycom"), a company absorbed by Multicanal in 1995, of all the differences in
its favor as a result of its participation in the tax exemption established by
Resolution No. 393/93.

The tax authorities based their rejection of the mentioned tax exemption on the
following grounds: (a) Vidycom was asked to make payment on several occasions,
but did not comply with COMFER's requirements, (b) no documentation supporting
the investments committed by the company was provided and (c) no evidence was
provided of the weather phenomenon as a result of which the previous
shareholders had requested the tax exemption.

The amount of the claim, which would be equivalent to 30% of the rate paid in
1994, 20% of the rate paid in 1995 and 10% of the rate paid in 1996, plus the
corresponding interest, has not yet been determined.

According to Multicanal, there are questions of fact and of law in its favor
which would lead COMFER to reassess its position. Consequently, no amount has
been recorded in these unaudited consolidated combined financial statements at
September 30, 2003.

(iii) Demand for payment due to rejection of requests for exemption

The COMFER issued various resolutions announcing the rejection of the request
for exemptions filed under the terms of Resolution No. 393/93 to the holders of
broadcasting licenses absorbed by Multicanal and to demand payment of sums due
plus interest.

The Company considers that there are allegations of fact and questions of law in
its favor that would require Comfer to review its position, but the Company
cannot provide any assurance that the authorities will rule in favor of the
Company.

(f) Other regulatory aspects

In February 1995, the City of Buenos Aires issued a municipal ordinance
regulating the authorization for the installation of TV cable networks. Such
ordinance establishes several alternatives for cable installation on the street,
namely: by underground laying, center of city block or posting. The ordinance
established a maximum term of 7 years for cable operators to adapt their wiring
networks according to the requirements of the ordinance. The municipality of the
City of Mar del Plata issued an ordinance to regulate the installation of cable
TV networks.

Although the Company has been adapting its network, it has had difficulties
making its network fully compliant as a result of the economic crisis in
Argentina, the current lack of financial stability and the successive tax
charges, which have forced the Company to apply its resources and income to
ensuring the continuity of its business and greatly reduce its capital
expenditures. On September 30, 2002 the Company requested suspension of the
terms established by ordinance 48,899. The municipality of the City of Mar del
Plata is also analyzing the granting of an extension for the license holders to
adapt their networks.

According to applicable regulations, 5% of the year's profit must be applied to
the legal reserves until it equals 20% of Company equity.

(g) Commitments to make contributions to Fintelco S.A.

Fintelco S.A. had a negative shareholders' equity as of September 30, 2003.
Under the Argentine Commercial Companies Law, this could bring its dissolution,
unless its capital is restored. Decree No. 1269/02 of the National Executive
Branch suspended the application of the abovementioned regulation until December
10, 2003. The Company and Cablevision S.A. each hold 50% of the equity of
Fintelco S.A. and, in that proportion, the Company has undertaken to make the
contributions required to pay the liabilities of Fintelco S.A. and of its
subsidiaries when due.

(h) Complaints against the Supercanal Group

The Company brought various claims against Supercanal Holding S.A. and its
subsidiaries (the "Supercanal Group"), including an action to declare
resolutions adopted during the Extraordinary Shareholders' Meeting of Supercanal
Holding S.A. on January 25, 2000 to reduce capital stock of Supercanal Holding
S.A. to Ps. 12,000 and subsequently increase capital to Ps. 83,012,000 null and
void. The Court issued an injunction requested by the Company but required that
the Company post bond for Ps. 22,000,000 for potential damages that could be
assessed against the defendant, should the complaint be dismissed. The remedy
was granted against the issue of a surety bond. The Court of Appeals revoked the
injunction. The Company has filed an extraordinary appeal against that
resolution, claiming it is both "arbitrary" and "damaging to the institution".
The appeal is in the process of being heard, and a ruling thereon is pending.

Other legal actions were initiated, claiming the suspension of: i) the last
three Ordinary Shareholders' Meetings of Supercanal Holding S.A. and ii) the
guarantees granted by Supercanal S.A. on bank loans exclusively in favor of the
group controlling Supercanal Holding S.A. (Grupo Uno S.A. and affiliated
companies). In addition, a claim for dissolution and liquidation of Supercanal
Holding S.A. was brought jointly with the action for removal of all the members
of the Board of Directors and the Surveillance Committee, and the dissolution of
Supercanal Capital N.V.

Supercanal Holding S.A. and other companies of the Supercanal Group filed for
bankruptcy proceedings with the National Court of First Instance on Commercial
Matters No. 20, Secretariat No. 40. and the procedures began on April 19, 2000.

As a result of the revocation of the preliminary injunction mentioned above, on
December 12, 2001 the Company was notified of the filing of a claim by
Supercanal Holding S.A. for damages caused by the granting of the preliminary
injunction that was subsequently revoked. It has been claimed that the
suspension of the effects of the meeting held on January 25, 2000 resulted in
the cessation of payments to Supercanal Holding S.A.

The Company answered the complaint and rejected the liability attributed to it
based on the fact that the cessation of payment had taken place before the date
of the meeting that was suspended by the preliminary injunction, according to
documentation provided by the plaintiff itself. Furthermore, the suspension of
the meeting did not prevent capitalization of the Company through other means.
Based on the record of the case, the Company considers that the claim filed
should be rejected in its entirety, and the legal costs should be borne by the
plaintiff.

No assurance can be provided that the Company will obtain an economic or
financial gain as a result of these actions. Presently, as a result of the
ancillary jurisdiction of the bankruptcy proceedings of Supercanal Holding S.A.,
all the claims are brought in the abovementioned Court.


NOTE 10 - LONG-TERM INVESTMENTS

<TABLE>
Investments carried under the equity method are as follows:

                             Direct percentage
                              participation in                                  Equity in the gains (losses)
            Company             voting stock              Investments             of affiliated companies
--------------------------------------------------------------------------------------------------------------
                                     %           September, 30   December 31,   September, 30  September, 30
                             ---------------------------------------------------------------------------------
                                                      2003           2002           2003            2002
                                                  (Unaudited)                    (Unaudited)    (Unaudited)
                                                 -------------------------------------------------------------
                                                                               $
                                                 -------------------------------------------------------------
<S>                                <C>            <C>             <C>              <C>           <C>
VER T.V. S.A. (1)...........       49.00             7,779,199      6,951,016        831,149       3,463,038
Fintelco S.A................       50.00           (18,330,982)   (19,465,318)     1,124,274      17,770,097
                                                 -------------------------------------------------------------
                                                   (10,551,783)   (12,514,302)     1,955,423      21,233,135
                                                 =============================================================
</TABLE>

(1) At September 30, 2003 the retained earnings that represent undistributed
earnings amount to Ps 7,614,757.


NOTE 11 - ANTITRUST CONSIDERATIONS

In September 1998, the Santa Fe branch of Asociacion del Consumidor ("Consumer
Association") filed with the Comision Nacional de Defensa de la Competencia (the
"National Commission for the Defense of Competition" or "CNDC") a complaint
against Multicanal and Cablevision S.A. alleging the existence of
anticompetitive practices in the city of Santa Fe. Consumer Association claims
that by dividing the subscribers, assets and liabilities of the VCC Group and
the Santa Fe Systems, the Company and Cablevision S.A. engaged in abuse of a
dominant market position and concerted actions to distribute the Santa Fe cable
market among themselves. The Company filed an answer to the complaint in which
it requests the CNDC to dismiss the complaint on the grounds of lack of a
factual basis and for failure to state a cause of action under the relevant
provisions of the Antitrust Law. The Company cannot assure that the final
decision shall be favorable to Multicanal, or that no further actions shall be
brought against the Company and/or Cablevision S.A. with respect to the division
of the VCC Group, the Bahia Blanca Systems and the Santa Fe Systems.

On January 13, 1999, the CNDC notified the Company that a complaint had been
filed by the Santa Fe commerce department alleging the existence of
anticompetitive practices by VCC in the city of Rosario, Province of Santa Fe,
prior to Multicanal's acquisition of this company. Although the Company has
filed an answer to the complaint with the CNDC, the Company cannot give any
assurance that its arguments will prevail and the final decision will be
favorable to it or that it will not be fined.

On February 18, 1999, the CNDC issued a resolution initiating an investigative
proceeding into an alleged agreement between the TV cable operating companies
VCC, Multicanal and Cablevision S.A. and those providing Television Satelital
Codificada S.A. and Tele Red Imagen S.A. channels. Such agreement is alleged to
consist of fixing of minimum prices for the trading of channels owning rights to
the broadcasting of football tournaments organized by the "Asociacion de Futbol
Argentino" in Federal Capital and Greater Buenos Aires. The investigation spans
from the year 1995 through the date of the resolution. On October 12, 1999 the
Company filed a discharge with CNDC under the terms of section 23 of the
Competition Defense Law, producing corresponding evidence. On February 10, 2000,
the submission of evidence period concluded and the case was submitted for a
ruling by the Court, by means of a resolution dated September 26, 2001 the
Commission penalized the companies with a fine, which in the case of Multicanal
amounts to $ 352,859. The resolution under which the fine was applied has been
appealed by the Company on October 8, 2002. The Company can give no assurance
that the final outcome will be favorable to it.

On March 12, 1999, the owner of a cable television operating company in the city
of Roldan, Province of Santa Fe, filed a complaint against Multicanal for
alleged anticompetitive practices in such city. Although the Company has filed
an answer to the complaint with the CNDC, the Company cannot give any assurance
that its arguments will prevail and the final decision will be favorable to it
or that it will not be fined.

In December 2001, Gigacable SA., a cable TV operator operating in certain areas
of the Provinces of Santa Fe and Corrientes, filed a complaint before the CNDC
accusing Multicanal of (i) having divided areas in which the companies provide
services with Cablevision S.A., (ii) uncompetitive practices, and (iii) selling
the subscription for a price below Multicanal S.A.'s usual price. On December 6,
2001 the Company answered the complaint.

As of the date of the issuance of these unaudited interim consolidated financial
statements, the CNDC is analyzing the answer filed by Multicanal. The Company
cannot provide assurance that the dispute will be settled or whether it will be
fined if no agreement is reached.

On September 17, 2003 the Company was notified of a claim made by Gigacable S.A.
alleging that Multicanal S.A. and Cablevision S.A (i) have made presentations
before various bodies (COMFER and the Municipality of Rosario), which hindered
Gigacable S.A. from obtaining the administrative permits to operate in Rosario;
(ii) engaged in monopolistic conduct. Multicanal answered that claim on October
6, 2003.

The Interior Trade and Consumer Defense Bureau of the Province of Entre Rios
filed a complaint against the CNDC for the presumed division of areas between
Multicanal and its competitors. On May 4, 1999, the Company filed a document
providing explanations in accordance with section 20 of the Competition Defense
Law, requesting that the claim be rejected. However, no assurance can be
provided that the final ruling will be in the Company's favor.

NOTE 12 - ARGENTINE ECONOMIC SITUATION AND ITS IMPACT ON THE COMPANY'S ECONOMIC
          AND FINANCIAL POSITION

At the end of 2001, the Argentine authorities implemented various monetary and
exchange control measures which mainly included restrictions on the free
availability of bank deposits and on transfers of funds abroad, except for
foreign trade and other authorized transactions which in some cases require the
prior approval of the Argentine Central Bank ("BCRA").

Subsequently, the Argentine Government declared default on its external debt and
on January 6, 2002 the Government enacted Law 25,561 on public emergency and
exchange system reform that involved profound changes to the then prevailing
economic model and amended the Convertibility Law that had been in force since
March 1991. Under this Law 25,561, the Executive Branch is empowered to enact
other monetary, financial and exchange regulations which are conducive to
overcoming the current economic crisis in the medium term.

Executive Branch Decree No. 71/2002 and BCRA Communication "A" 3425 and its
amendments established an official exchange market for exports, certain imports
and financial obligations, and a free exchange market on which the remaining
transactions were to be carried out.

Subsequently, various regulations were issued which introduced additional
changes to the new norms. These included the unification of the exchange market
into a single, free market, the conversion to pesos of US dollar deposits with
Argentine financial institutions at an exchange rate of $ 1.40 per US dollar as
well as of obligations in Argentina denominated in US dollars or any other
foreign currency existing as of January 6, 2002, at the $ 1 = US$1 exchange rate
and subsequent index-adjustment by applying the CER, based on the Retail Price
Index (except for certain operations), the conversion to pesos of public utility
rates previously determined in US dollars and their case-by-case renegotiation,
the requirement for prior authorization of the BCRA to make certain transfers
abroad for the servicing and principal and interest, the suspension of employee
termination without a legal justification which will expire on December 31, 2003
and the suspension until December 10, 2003 of company dissolution due to
reduction in capital stock and mandatory reduction of capital established by the
Corporations Law.

The impact generated by all these measures adopted to date by the Government on
the financial situation of the Company at September 30, 2003 was calculated
according to the evaluations and estimates made by Management at the date of
preparing these unaudited interim consolidated financial statements. Actual
results could differ from the evaluations and estimates made at the date of
preparing these unaudited interim consolidated financial statements and these
differences could be significant. Therefore, the Company's financial statements
may not report all the adjustments that could result from these adverse
conditions. Furthermore, at this time it is not possible to foresee the future
development of the country's economy or its consequences on the economic and
financial situation of the Company. Thus, any decision that must be made on the
basis of these unaudited interim consolidated financial statements must take
into account the effects of these measures and their future development and the
Company's financial statements must be considered in the light of these
uncertain circumstances.

In the period ended September 30, 2003, the Company recognized a shortfall in
consolidated working capital amounting to Ps. 1,805,935,530. Continuing adverse
market conditions and their negative effect on the Company's cash flows, coupled
with limited liquidity, are likely to limit the Company's ability to meet its
obligations.

In addition, the losses recorded by the Company exceed 50% of its capital and
100% of its reserves as of September 30, 2003. Although section 206 of the
Commercial Companies Law establishes a mandatory capital reduction in such
situations, by means of Decree 1269/02, the National Executive suspended
enforcement of this regulation until December 10, 2003.

These unaudited interim consolidated financial statements have been prepared
assuming that the Company will continue as a going concern. Therefore, these
financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or the amounts and
classification of liabilities that might be necessary should the Company be
unable to continue as a going concern. The Company's continuation as a going
concern is dependent upon its ability to generate sufficient cash flows to meet
its obligations on a timely basis, to obtain additional financing as may be
required, and ultimately to attain profitable operations and positive cash
flows.

NOTE 13 - NOTIFICATION OF PETITIONS FOR BANKRUPTCY FILED AGAINST THE COMPANY

As of these unaudited interim consolidated financial statements the Company has
been served with process on 33 petitions for bankruptcy against it as a result
of the Company's deferral of payments of principal and interest on its
negotiable obligations. The Company filed its response in all cases, and
deposited in escrow, the amount claimed in pesos at the rate of exchange of US$
1 = $ 1 plus CER plus 8% per annum for interest and 5% to cover possible
expenses relating to lawsuits. The judge considered it sufficient at this time
in order to disregard the credit invoked as "revealing factor" of suspension of
payment of debts, the deposit made by the Company, dismissing 33 petitions for
declaration of bankruptcy, the Court of Appeals having ratified the lower court
decisions in those cases where plaintiffs have appealed such decisions.

The Company argued in its response to the bankruptcy petitions that its foreign
currency obligations had been converted to pesos as established by Section 1 of
Decree No. 214/02, because the provisions of Section 1, subsection e) of Decree
No. 410/02 (establishing that "the obligations of the public and private sectors
denominated in foreign currency, compliance with which is subject to foreign
laws, are not subject to the conversion to pesos") do not apply in this case.

In the offer to restructure its financial debt (see Note 7) the Company
calculated Existing Debt to be restructured in US dollars, to reflect more
clearly the reduction of the debt and the exchange ratio for the new securities
that would be issued if its restructuring transactions are consummated. The fact
that the Company has denominated its debt in US dollars does not mean that the
Company has waived its right to assert that those obligations should be
considered to have been converted to pesos. The Company's reason for
denominating such debt in U.S. dollars is only to conclude the negotiation stage
of the reorganization plan in a quick and effective manner in order to obtain
creditors' acceptance of the proposal without having to waive any valid rights.
This approach, which does not address the definition of the scope of the Decree
on Conversion to Pesos referred to above, has been the most appropriate one to
overcome financial difficulties for the benefit of the Company, its creditors
and the public in general, but should not be construed as a waiver by the
Company of its right to sustain that its debt is subject to pesification norms.

In view of this, in the submission filed to request approval of the
reorganization plan from the court, the Company reserved its right to file a
motion for the pesification of all financial debts incurred in the issuance of
outstanding negotiable obligations if the out-of-court reorganization plan were
not to be approved and insolvency proceedings were to be filed against it.

If the restructuring process undertaken by the Company is unsuccessful it will
likely have to file voluntary insolvency proceedings.

<PAGE>


<TABLE>
Condensed from the original prepared in Spanish for publication in Argentina

                                 MULTICANAL S.A.
                                                                                                              Exhibit
       INFORMATION REQUIRED BY SECTION 64, SUB-SECTION b) OF LAW No. 19550
          for the nine months periods ended September 30, 2003 and 2002
        (Expressed in constant Argentine pesos through February 28, 2003
                   and in nominal pesos thereafter - Note 2.3)

===================================================================================================================
            Caption                  Direct         General and      Selling and        Total at September 30,
                                    operating     administrative      marketing     -------------------------------
                                    expenses         expenses         expenses            2003            2002
-------------------------------------------------------------------------------------------------------------------
                                    (Unaudited)      (Unaudited)      (Unaudited)      (Unaudited)    (Unaudited)
                                 ----------------------------------------------------------------------------------
<S>                                 <C>              <C>              <C>              <C>             <C>
Payroll and social security          25,798,935        7,237,297      10,253,449       43,289,681      69,811,139

Employees' dismissals                   979,426           51,501       1,257,388       2,288,315        2,664,199

Taxes rates and contributions         6,970,275        2,903,274       6,188,005       16,061,554      21,280,695

Insurance                                45,149           91,229               -        136,378           169,341

Programming rights                  119,554,081                -               -       119,554,081    149,751,018

Printing and distribution of
  magazines                           5,233,597                -               -        5,233,597      13,558,250

Fees and compensation for
  services                              467,709        7,181,686          70,720        7,720,115      12,033,486

Commissions                           2,204,713       11,570,056           7,093       13,781,862      17,024,464

Overhead                              2,053,486          632,268          20,556        2,706,310       3,633,026

Personnel expenses                    2,255,039        1,698,126       1,122,360        5,075,525       4,594,798

Building expenses                       621,711        3,734,170               -        4,355,881       5,623,121

Vehicles expenses                        58,949        2,152,337               -        2,211,286       2,383,062

Rentals                              10,135,504        1,494,616               -       11,630,120      14,659,156

Security and surveillance                30,998        1,194,301               -        1,225,299       1,862,998

Representation and travel
  expenses                                2,030          851,871               -          853,901         985,071

Office expenses                         103,057        1,357,797          14,538        1,475,392       2,514,722

Publicity and advertising                   -                  -       4,407,695        4,407,695       8,180,657

Sundry                                5,115,835        4,689,458               -        9,805,293      21,888,050
                                 ----------------------------------------------------------------------------------
Total at September 30, 2003        181,630,494        46,839,987      23,341,804      251,812,285
                                 ==================================================================================
Total at September 30, 2002        247,131,459        73,321,402      32,164,392                      352,617,253
===================================================================================================================
</TABLE>

<PAGE>


                                    SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                                MULTICANAL S.A.



Buenos Aires, Argentina, November 12, 2003      By: /s/ Adrian Meszaros
                                                    -----------------------
                                                    Adrian Meszaros
                                                    Chief Financial Officer