SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 

 

FORM 6-K

Report of Foreign Private Issuer 

 

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

 

 

**For the month of August 2006**
 

 

**Commission File Number 1-03006**

 

 

Philippine Long Distance Telephone Company
(Exact Name of Registrant asSpecified in Its Charter)

 

**Ramon****Cojuangco Building**

**Makati Avenue**

**Makati****City**

**Philippines**

(Address of principal executiveoffices)

 

 

(Indicate by check markwhether the registrant files or will file annual reports under cover Form 20-For Form 40-F.)

 

Form20-F      Ö                                  Form40-F

 

 

(Indicate by check markwhether by furnishing the information contained in this Form, the registrant isalso thereby furnishing the information to the Commission pursuant to Rule12g3-2(b) under the Securities Exchange Act of 1934.)

 

Yes                                                        No       Ö

 

 

(If "Yes" ismarked, indicate below the file number assigned to the registrant in connectionwith Rule 12g3-2(b): 82- ________ )
****
 

 

NOTE REGARDINGFORWARD-LOOKING STATEMENTS

 

Some information in this report may containforward-looking statements within the meaning of Section 27A of the U.S.Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of1934.  We have based these forward-looking statements on our current beliefs,expectations and intentions as to facts, actions and events that will or mayoccur in the future.  Such statements generally are identified byforward-looking words such as “believe,” “plan,” “anticipate,” “continue,” “estimate,”“expect,” “may,” “will” or other similar words.

A forward-looking statement may include astatement of the assumptions or bases underlying the forward-lookingstatement.  We have chosen these assumptions or bases in good faith.  Theseforward-looking statements are subject to risks, uncertainties and assumptions,some of which are beyond our control.  In addition, these forward-lookingstatements reflect our current views with respect to future events and are nota guarantee of future performance.  Actual results may differ materially frominformation contained in the forward-looking statements as a result of a numberof factors, including, without limitation, the risk factors set forth in“Item 3. Key Information – Risk Factors” in our annual report on Form 20-Ffor the fiscal year ended December 31, 2005.  You should also keep in mind thatany forward-looking statement made by us in this report or elsewhere speaksonly as at the date on which we made it.  New risks and uncertainties come upfrom time to time, and it is impossible for us to predict these events or howthey may affect us.  We have no duty to, and do not intend to, update or revisethe statements in this report after the date hereof.  In light of these risksand uncertainties, you should keep in mind that actual results may differmaterially from any forward-looking statement made in this report or elsewhere.

 
 

 

**EXHIBITS**
 

 

 

Exhibit Number

 

Page

 

1

 

A copy of the disclosure letter we sent today to the Philippine Stock Exchange and the Securities and Exchange Commission regarding cash dividend declaration on the Company’s Common Capital Stock and Series B, F, Q, V and Z 10% Cumulative Convertible Preferred Stock.

 

 

4

 

2

 

A copy of SEC Form 17-C with a press release attached thereto regarding the Company’s financial condition and results of operations for the six (6) months ended June 30, 2006.

 

 

10

 

Exhibit1

August8, 2006

 

Philippine Stock Exchange

4/F Philippine Stock Exchange Center

Exchange Road, Ortigas Center

Pasig City

 

Attention:  Ms. Jurisita M. Quintos

SVP– Operations Group 

Gentlemen:

 

            In compliance with thedisclosure requirements of the Philippine Stock Exchange, we advise that duringthe meeting of the Board of Directors of our Company on August 8, 2006, thefollowing cash dividends were declared out of the unrestricted retainedearnings of the Company as of December 31, 2005:

 

1.         P50.00 per outstandingshare of the Company’s Common Capital Stock, payable on September 21, 2006 tothe holders of record on August 21, 2006.

 

2.         P1.00 per outstandingshare of the Company’s Series B 10% Cumulative Convertible Preferred Stock, forthe annual period ending August 31, 2006, payable on September 29, 2006, to theholders of record on September 1, 2006.

 

3.         P1.00 per outstandingshare of the Company’s Series F 10% Cumulative Convertible Preferred Stock, forthe annual period ending August 31, 2006, payable on September 29, 2006, to theholders of record on September 1, 2006.

 

4.         P1.00 per outstandingshare of the Company’s Series Q 10% Cumulative Convertible Preferred Stock, forthe annual period ending August 31, 2006, payable on September 29, 2006, to theholders of record on September 1, 2006.

 

5.         P1.00 per outstandingshare of the Company’s Series V 10% Cumulative Convertible Preferred Stock, forthe annual period ending August 31, 2006, payable on September 29, 2006, to theholders of record on September 1, 2006.

 

6.         P1.00 per outstandingshare of the Company’s Series Z 10% Cumulative Convertible Preferred Stock, forthe annual period ending August 31, 2006, payable on September 29, 2006, to theholders of record on September 1, 2006.

 

            Thankyou.

Very truly yours,

 

/s/ Ma. Lourdes C. Rausa-Chan

MA. LOURDES C. RAUSA-CHAN
Corporate Secretary

Page 1 of 4

  Exhibit 1

COVERSHEET

 

 

P

W

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5

5

 

SEC Registration No.

 

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Y

 

 

 

 

(Company’s Full Name)

 

R

A

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C

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C

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B

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M

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C

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Y

 

 

(Business Address: No.Street/City/Town/Province)

 

ATTY. MA. LOURDES C. RAUSA-CHAN

 

816-8405

Contact person

 

Contact Telephone No.

 

 

1

 

2

 

 

3

 

1

 

 

SEC FORM 17-C

 

 

0

 

6

Every 2nd

Tuesday

 

 

Month

 

Day

 

FORM TYPE

 

Month

Day

 

 
Fiscal Year

 

Annual Meeting

 
 

C

F

D

 

N/A

Dept. Requiring this Doc.

 

Amended Articles

Number/Section

 

 

Total Amount of Borrowings

2,191,308

As of June 30, 2006

 

 

NA

 

 

NA

Total No. of Stockholders

 

Domestic

 

Foreign

 

----------------------------------------------------------------------------------------------------------------

To be accomplished by SEC Personnelconcerned

 

 
 

 

 

 

 

 

 

 

 

 

 

______________________________

File Number

 

LCU

 
 

 

 
 

 

 

 

 

 

 

 

 

 

 

______________________________

 
Document I.D.

 

Cashier

 

 

STAMPS

   

 

 

 

Remarks: Please use blackink for scanning purposes

Page 2 of 4

  Exhibit 1

 

 

 

SECURITIES AND EXCHANGECOMMISSION

 

 

CURRENT REPORT UNDER SECTION 17

OF THE SECURITIES REGULATION CODE

AND SRC RULE 17.1

 

 

 

1.                 8 August 2006

Date of Report (Date of earliest event reported)

 

2.                 SEC Identification Number PW-55

 

3.                 BIR Tax Identification No. 000-488-793

 

4.                 PHILIPPINE LONGDISTANCE TELEPHONE COMPANY

Exact name of issuer as specified in its charter

 

5.         PHILIPPINES                                                6.____________(SEC Use Only)  

Province, country or other jurisdiction                    IndustryClassification Code

of Incorporation

 

7.         Ramon Cojuangco Building, Makati Avenue, Makati City                   1200 

Address of principaloffice                                                            Postal Code

 

8.         (632) 816-8405 

Issuer's telephone number, includingarea code
 

9.         NotApplicable 

Former name or former address, if changed since last report

 

10.             Securities registered pursuant to Sections 8 and 12 ofthe Securities Regulation Code and Sections 4 and 8 of the Revised SecuritiesAct

 

Title of Each Class

Number of Shares of Common Stock

Outstanding and Amount of Debt Outstanding

_____________________________________________________________

_____________________________________________________________

_____________________________________________________________

 

Page 3 of 4

  Exhibit 1

 

 

Item 9 (OtherEvents)

 

 

We disclose thatthe Board of Directors of Philippine Long Distance Telephone Company (the“Company”), at its meeting held on August 8, 2006 declared, out of theunrestricted retained earnings of the Company as of December 31, 2005, thefollowing cash dividends:

 

1.     P50.00per outstanding share of the Company’s Common Capital Stock, payable onSeptember 21, 2006 to the holders of record on August 21, 2006.

 

2.     P1.00per outstanding share of the Company’s Series B 10% Cumulative ConvertiblePreferred Stock, for the annual period ending August 31, 2006, payable onSeptember 29, 2006, to the holders of record on September 1, 2006.

 

3.     P1.00per outstanding share of the Company’s Series F 10% Cumulative ConvertiblePreferred Stock, for the annual period ending August 31, 2006, payable onSeptember 29, 2006, to the holders of record on September 1, 2006.

 

4.     P1.00per outstanding share of the Company’s Series Q 10% Cumulative ConvertiblePreferred Stock, for the annual period ending August 31, 2006, payable onSeptember 29, 2006, to the holders of record on September 1, 2006.

 

5.     P1.00per outstanding share of the Company’s Series V 10% Cumulative ConvertiblePreferred Stock, for the annual period ending August 31, 2006, payable onSeptember 29, 2006, to the holders of record on September 1, 2006.

 

6.     P1.00per outstanding share of the Company’s Series Z 10% Cumulative ConvertiblePreferred Stock, for the annual period ending August 31, 2006, payable onSeptember 29, 2006, to the holders of record on September 1, 2006.

 

 

Pursuantto the requirements of the Securities Regulation Code, the Company has dulycaused this Report to be signed on its behalf by the undersigned hereunto dulyauthorized.

 

 

 

**PHILIPPINE LONG DISTANCE TELEPHONE COMPANY**
 

By:

 

/s/ Ma. Lourdes C. Rausa-Chan

MA. LOURDES C. RAUSA-CHAN

Corporate Secretary

August 8, 2006

Page 4 of 4

  Exhibit 2
 

 
 
 
 

August 8, 2006
 

 

Philippine Stock Exchange

4/F Philippine Stock Exchange Center

Exchange Road, Ortigas Center

Pasig City

 

Attention:  Ms. Jurisita M. Quintos

SVP –Operations Group 
 

Gentlemen:

 

            Inaccordance with Section 17.1 (b) and Section 17.3 of the Securities RegulationCode, we submit herewith a copy of SEC Form 17-C with a press release attachedthereto regarding the Company’s financial condition and results of operationsfor the six (6) months ended June 30, 2006.

 

            Thisshall also serve as the disclosure letter for the purpose of complying with PSERevised Disclosure Rules.

 

 

 

Very truly yours,

 

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
 

 

 

/s/ Ma. Lourdes C. Rausa-Chan

MA. LOURDES C. RAUSA-CHAN
Corporate Secretary

 

 

Page 1 of 10

  Exhibit 2
 

 

 

 

 

August 8, 2006
 

 

Securities & ExchangeCommission

Money Market OperationsDepartment

SEC Building, EDSA

Mandaluyong City

 

Attention:  DirectorJustina F. Callangan
Corporations Finance Department
 

Gentlemen:

 

            Inaccordance with Section 17.1 (b) of Securities Regulation Code and SRC Rule17.1, we submit herewith five (5) copies of SEC Form 17-C with a press releaseattached thereto regarding the Company’s financial condition and results ofoperations for the six (6) months ended June 30, 2006.

 

Very truly yours,

 

PHILIPPINE LONG DISTANCE TELEPHONE COMPANY
 

 

 

/s/ Ma. Lourdes C. Rausa-Chan

MA. LOURDES C. RAUSA-CHAN
Corporate Secretary

 

 

Page 2 of 10

   Exhibit 2

 

COVER SHEET

 

 
P

W

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5

5

 
 

S.E.C. Registration No.

 

P

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(Company’s Full Name)

 

R

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(Business Address: No. Street City/Town/Province)

 

ATTY. MA. LOURDES C. RAUSA-CHAN

 

816-8405

Contact Person

 

Company Telephone Number

 

 
 

1

 

2

 

 

3

 

1

 

 

SEC FORM 17-C

 

 

0

 

6

Every 2nd

Tuesday

 

 

 
Month

Day

FORM TYPE

Month

Day

Fiscal Year

 

Annual Meeting

 
 

 
C

F

D

 

N/A

Dept. Requiring this Doc.

 

Amended Articles

Number/Section

 

 

Total Amount of Borrowings

 
2,191,308

As of June 30, 2006

 

N/A

 

 

N/A

 
 
Total No. of Stockholders

 

Domestic

 

Foreign

 

----------------------------------------------------------------------------------------------------------------------------

To be accomplished by SEC Personnel concerned
 

 

 

 

 

 

 

 

 

 

 

 

______________________________

 
 
File Number

 

LCU

 

 

 

 

 

 

 

 

 

 

 

 

 

______________________________

 
 
Document I.D.

 

Cashier

 

 

 

**STAMPS**
 

Remarks: Please useblack ink for scanning purposes.

Page 3 of 10

  Exhibit 2

 

 

SECURITIES AND EXCHANGE COMMISSION

 

 

 

CURRENT REPORT UNDER SECTION 17

OF THE SECURITIES REGULATION CODE

AND SRC RULE 17.1

 

 

 

1.         8August 2006

Date of Report (Date of earliest event reported)

 

2.         SECIdentification Number PW-55

 

3.         BIRTax Identification No. 000-488-793

 

4.         PHILIPPINELONG DISTANCE TELEPHONE COMPANY

Exact name of issuer as specified in its charter

 

5.         PHILIPPINES                                                  6.____________(SEC Use Only)  

Province, country or other jurisdiction              IndustryClassification Code

of Incorporation

 

7.         Ramon Cojuangco Building, Makati Avenue, Makati City                         1200 

Address of principal office                                                                  PostalCode

 

8.         (632)816-8405 

Issuer's telephone number, includingarea code
 

9.         NotApplicable 

Former name or former address, if changed since lastreport

 

10.       Securities registeredpursuant to Sections 8 and 12 of the Securities Regulation Code and Sections 4and 8 of the Revised Securities Act

 

Title of Each Class

Number of Shares of Common Stock

Outstanding and Amount of Debt Outstanding

 

____________________________________________________________

____________________________________________________________

____________________________________________________________

 

Page 4 of 10

  **Press release**

** **

**CORE EARNINGS UP 11% TOP15.2 BILLION;****CASH FLOWSSTRONG WITH EBITDA UP 7% TO P40 BILLION;P50 INTERIM DIVIDEND PER SHARE DECLARED**

 

•     Corenet income of P15.2 billion (before the effects of forex gains, deferred taxassets and additional depreciation), an increase of 11% from first half 2005 

•     Coreearnings per share (“EPS”) up 9% to P82.48 per share 

•     P50interim common dividend per share, representing a 60% dividend payout based oncore EPS 

•     Reportedconsolidated net income of P15.3 billion for the first half 2006, 7% lower thanP16.5 billion in first half of 2005 due to additional depreciation expenses,lower forex gains and higher statutory tax rate 

•     ConsolidatedEBITDA reaches P40.4 billion, up 7%; EBITDA margin improves to 67% of servicerevenues 

•     Consolidatednet debt balance down 35% to below P70 billion equivalent (US$1.3 billion) 

•     Piltelprepays US$176 million of its debts, US$56 million to third parties 

 

***MANILA,Philippines, 8th August 2006***   –– Philippine Long Distance Telephone Company (“PLDT”)(PSE: TEL) (NYSE: PHI) today announced its unaudited financial results for thefirst half of 2006, reporting consolidated core earnings of P15.2 billion,before the effects of foreign exchange, deferred tax assets and additionaldepreciation, 11% up compared with core earnings of P13.7 billion for the sameperiod in 2005.  As a result, the Company’s Board of Directors approved thedeclaration of an interim dividend of P50 per share.  The record date for thedividend is 21st August 2006 with payment date on 21st September 2006. The dividend declaration is based on a 60% payoutof core earnings per share. 

 

Reportednet income decreased by 7% to P15.3 billion compared with the P16.5 billion netprofit reported in the same period last year. The decline is attributed toadditional depreciation expenses, foreign exchange losses and a higherstatutory tax rate – which were partly mitigated by lower interest expense dueto lower net debt balances. 

 

Consolidatedservice revenues rose by 2% to P60.6 billion. Consolidated EBITDA improved by7% to P40.4 billion while EBITDA margins rose to 67% compared with 64% lastyear.   

 

Consolidatedcapital expenditures increased to P12.4 billion as the Group stepped up theupgrading and expansion of its fixed line and wireless networks.  PLDT iscurrently upgrading about 200,000 fixed lines to NGN while Smart has expandedits cellular network to support its ongoing initiatives and programs for 2G,wireless broadband and 3G.   The Group expects total capital expenditures for2006 to reach P20 billion. 

 

Page 5 of 10

  The Group’s consolidatedbalance sheet continued to strengthen with the consolidated net debt balancedown by 35% to US$1.3 billion or about P70 billion equivalent. Net debt toEBITDA and net debt to free cash flow ratios improved to below 1.0 times and1.7 times, respectively.  

 

InJune 2006, cellular subsidiary Pilipino Telephone Corporation (“Piltel”)voluntarily prepaid 45% of its outstanding debt or an aggregate amount ofUS$176 million. The amount represented excess cash flows from Piltel’soperations and was applied proportionally to prepay US$56 million to thirdparty creditors and US$120 million to Smart Communications, Inc. (“Smart”),Piltel’s largest creditor.  As of 30th June2006, Piltel’s debt balance owed to third party creditors was approximatelyUS$71 million. 

 

Consolidatedfree cash flow remained strong at P17.4 billion despite increases in capitalexpenditures and working capital requirements.  PLDT expects to pay out a totalof approximately P9.1 billion of common dividends for this dividend declarationalone. 

 

“Weare pleased to announce a continued healthy growth of 11% in core earnings forthe first half of 2006 and the declaration of an interim  dividend for 2006 ofP50 per share, based on a 60% payout of core EPS. The Group’s excellent cashflow position and profits allow us to invest in future growth while continuingto attend to the needs of our various stakeholder groups”, stated **Manuel V.Pangilinan**,**PLDT Chairman**.

 

 

**Wireless:Moving Beyond Cellular**

 

Consolidatedwireless service revenues rose to P38.6 billion for the first half of 2006, 6%higher than the P36.5 billion realized in the same period last year.Consolidated wireless EBITDA grew by 8% to P25.8 billion for the first sixmonths of 2006 versus P23.9 billion for the first half of 2005.  EBITDA marginsimproved to 67%.   

 

Smart and Piltelsustained their solid performances for the quarter, recording a 4%quarter-on-quarter growth in service revenues to P19.6 billion in the secondquarter of the year.  As a result of Smart’s continued focus on managing cashoperating expenses, EBITDA increased by 8% in the second quarter to P13.4billion, representing a 68% EBITDA margin. 

 

The PLDT Group’stotal cellular subscriber base for the first half of 2006 grew by over twomillion subscribers to 22.5 million.  Smart recorded net additions ofapproximately 980,000 subscribers while *Talk ‘N Text* added about onemillion subscribers to end the first half of 2006 with 16.4 million and 6.1million subscribers, respectively.     

 

Smart also had58,000 wireless broadband subscribers as of the end of June 2006 under its *SmartBro*wireless broadband service. Smart now has over 2,200 wirelessbroadband-enabled base stations providing high-speed internet access in 386cities and municipalities all over the country at very affordable rates.Through *Smart Bro*, Smart has also been able to roll out *Smart Click,*a series of mobile Internet cafés housed in an air-conditioned 40-footcontainer van and designed to provide remote communities with high-speed,wireless Internet access nationwide. The increased network coverage of *SmartBro*allows the Group to gain “first mover” advantages in acquiringbroadband subscribers in areas that are currently not covered by PLDT’s fixedline DSL network. 

 

Page 6 of 10

  For the first half of 2006, Smartcontinued to offer products and services which provide value to its subscribersin a truly innovative fashion. In late June, Smart added *Unli* (short forunlimited) to its top-up repertoire -*Unli* allows for unlimitedon-network texting without the need for registration. The *Unli 30* has aP30 load denomination and an expiration period of two days. 

 

The *Unli 40*has a P40 load denomination and offers unlimited on-network texting plus fiveadditional on-network/off-network SMS and two three-minute Smart-to-Smart callsand is also valid for two days. Along with *Smart 25**8**Unlimited Text* and *Smart Load “AllText”,* these low denomination products address markets who need to maintainbasic communications yet have limited spending capacity.  In addition, the P10and P15 flat rate call promotion has stimulated usage for voice by giving morevalue for longer duration calls while the *Smart 25**8**Combo*promotion offers a voice feature forthe heretofore “text only” market.  

 

On 15th June2006, Smart completely aligned its *Smart 3G* rates with existing 2Grates. Services include video calling, TV streaming of major televisionnetworks, downloads of full music tracks and video clips as well asinternational video calling to 13 countries.   Smart’s 3G network has over 830cell sites covering 142 cities and municipalities nationwide representing thefirst and widest 3G network in the country. 

 

“You will notethat we have been segmenting our market into smaller slices through our variousSMS and voice call packages. This ability to offer attractive unlimitedpackages that give real value to our subscribers has enabled us to effectivelydefend our leadership position. These are exciting times as we begin theprocess of transforming Smart from a cellular company into a multi-servicewireless communications company,” said **Napoleon L. Nazareno, President andCEO of PLDT and Smart**.

 

 

**PLDT FixedLine: Stepping up Broadband**

 

Fixed Line servicerevenues decreased 1% to P24.1 billion in the first half of 2006 from P24.2billion last year as the increase in data revenues, from both corporate dataservices and residential DSL, was offset by declines in revenues of localexchange and ILD services.  The peso has appreciated year-on-year by 5%, whichimpacted the dollar-linked revenues arising from the local exchange and ILDbusinesses. 

 

PLDT DSL continuedits strong growth as broadband subscribers reached 109,000 while PLDT *WeRoam*had 6,600 subscribers as of the end of June 2006. Subscribers using our *Vibe*dial­up Internet service also grew by 43,000 in the first six months of 2006 to425,000.  PLDT DSL and Vibe contributed P1.7 billion in revenues for the firsthalf of 2006, up 43% from last year.  

 

EBITDA for thefirst half of 2006 rose by 4% to P14.2 billion and EBITDA margins improved to59% compared with 56% for the same period last year. The increase in EBITDAtakes into account the significant decline in the provision for doubtfulaccounts brought about by improved collections.  

 

Page 7 of 10

  Additional depreciation expenses of P3.9billion were taken up in the first six months of 2006 due to a change in theestimated useful lives of certain fixed assets as the migration to NextGeneration Network (NGN) progresses. Without these additional charges, totaloperating expenses would have decreased by 1%. 

 

In June 2006, PLDT introduced *Shops.WorkUnPlugged*, or *SWUP*, a bundled solution that enables wireless cashierpoint-of-sale and wireless card terminals, to address the need of retailers andbanks for real-time wireless data communication.    

 

In addition, PLDTis also continuing to push the maximization of the network by re-launching aprepaid fixed line service called *Telepwede.*This prepaid fixed lineservice allows subscribers to have a fixed line phone for as low as P145 permonth, inclusive of a P30 load for outgoing calls and a P115 access charge forincoming calls.  *Telepwede* subscribers may also use the service fornarrowband internet access for P5 per hour. 

 

"The ongoing upgrade to NGN is expected toresult in a simpler network architecture of fewer network elements but with agreater capability to provide data services at lower costs. The completion ofthe NGN upgrade will result in immediate reduction in power consumption andinsurance costs as well as opportunities to do space rationalization,"declared **Nazareno**. 

 

 

**ePLDT:Moving to the Forefront**

 

ePLDT, the Group’sinformation and communications technology arm, reported service revenues ofP1.8 billion for the first six months of 2006, a 36% increase from P1.3 billionrealized in the same period last year, mainly driven by the continued growth inthe call center business (ePLDT Ventus).  

 

Consolidated callcenter revenues continued its robust performance, growing 48% to P1.2 billionas a result of increases in capacity utilization and billable hours for new andexisting clients. Call center revenues make up 68% of ePLDT’s total revenues.ePLDT Ventus  now operates seven sites with combined call center seats of 4,660and an employee base of close to 4,700. 

 

On 11th July2006, ePLDT completed the acquisition of 100% of SPi Technologies, Inc. and itsdirect and indirect Philippine and offshore subsidiaries (“SPi”).  SPi is the 2ndlargest pure-play business process outsourcing (“BPO”) company and the 9th largestindependent BPO service provider worldwide.  It has operations in 19 locationsin North America, Europe and Asia.  Its core capabilities include contenteditorial and production, litigation support coding and electronic discovery,medical transcription, and database structuring and management. 

 

The acquisition ofSPi, together with ePLDT’s existing Ventus call center group, creates theindustry’s foremost BPO services provider with over 11,000 employees and about8,300 seats in its combined BPO/call center operations.    

 

Page 8 of 10

  “With SPi’s well-established presence inthe U.S. and its domain expertise in a variety of service verticals, we nowhave a unique opportunity to increase our participation in the growing base ofthe global outsourcing and offshoring market. We are also exploring theacquisition, through SPi, of a US-based medical transcription company tofurther SPi’s goal of becoming a significant player in the growing health careoutsourcing industry. The investment in SPI manifests our commitment to makethe Philippines one of the leading BPO locations in the world and our abidingfaith in the capabilities of the Filipino workers”, said **Ray C. Espinosa,ePLDT President and CEO**. 

 

 

**Conclusion**

 

“With the cellularindustry moving past its rapid-growth phase, the need to shift into broadbandand data services has become increasingly apparent. Management understands thecomplexities and challenges of the changing market environment and we willmanage new technologies in the context of our subscribers’ needs”, addedNazareno. 

 

“Over the mediumterm, our goals are to continue achieving growth in our core businesses whileestablishing new revenue streams from recent investments, principally SPi.  Ourstrong cash flows provide us with this “triple play” ability – new investments,sustained capital expenditures and increasing dividend yields.  In this way, weaddress shareholder needs both for the present and for the longer term,”concluded**Chairman Manuel V. Pangilinan**. 

 

### 

** **

** **

**PLDT Consolidated**

**Six Months ended June 30****Three Months ended June 30**

 
**2006**

**2005**

**2006**

**2005**

**Service revenues**

**60,640**

**59,543**

**30,662**

**30,268**

**Non-service revenues**

**1,383**

**1,422**

**674**

**607**

**Other income**

**338**

**173**

**206**

**119**

 

**62,361**

**61,138**

**31,542**

**30,994**

**Expenses**

**43,736**

**39,103**

**24,189**

**21,673**

**Income before income tax**

**18,625**

**22,035**

**7,353**

**9,321**

**Provision for income tax**

**2,986**

**5,483**

**477**

**2,008**

**Net income - As Reported**

**15,306**

**16,520**

**6,725**

**7,303**

**EPS, Basic****(a)**

**83.02**

**92.44**

**36.28**

**40.51**

**EPS, Diluted****(a)**

**83.00**

**87.88**

**36.28**

**40.51**

**Core net income****(b)**

**15,207**

**13,691**

**7,641**

**7,193**

**EPS, Basic****(c)**

**82.48**

**75.85**

**41.35**

**39.89**

**EPS, Diluted****(c)**

**82.46**

**72.62**

**41.35**

**39.89**

*(a)*

*EPS based on reported net income*

 

 

 

 

*(b)**Net income as adjusted for the neteffect of gain/loss on FX and derivative transactions,*

***additional depreciation charges andrecognition of deferred tax assets*

*(c)**EPS based on core net income*

Page 9 of 10

    

*This press release may contain some statements which constitute“forward-looking statements” that are subject to a number of risks and uncertaintiesthat could affect PLDT’s business and results of operations.  Although PLDTbelieves that expectations reflected in any forward-looking statements arereasonable, it can give no guarantee of future performance, action or events.*

 

 

 

For further information, please contact: 

** **

**Anabelle L.Chua                  Anna V. Bengzon                  Ramon R. Isberto**

Tel No: 816-8213                    Tel No: 816-8024                    TelNo: 511-3101

Fax No: 844-9099                   Fax No: 810-7138                   FaxNo: 893-5174 

 

 

 

**About PLDT**

 

PLDT is theleading telecommunications provider in the Philippines. Through its threeprincipal business groups – fixed line, wireless and information communicationstechnology – PLDT offers a wide range of telecommunications services across the Philippines’ most extensive fiber optic backbone and fixed line, cellular andsatellite network. 

 

PLDT is listed onthe Philippine Stock Exchange (PSE:TEL) and its American depositary shares arelisted on the New York Stock Exchange (NYSE:PHI).  PLDT has one of the largestmarket capitalizations among Philippine listed companies. 

 

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  Further information can be obtained byvisiting the web at www.pldt.com.ph.

 

Signatures

 

 

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

 

 

 

PHILIPPINE LONG DISTANCE

TELEPHONE COMPANY

 

 

 

By        :     /s/ Ma. Lourdes C. Rausa-Chan

Name  :     Ma. Lourdes C. Rausa-Chan

Title     :     Senior Vice President, Corporate

                  Affairs and Legal Services Head 

                  and Corporate Secretary

 

 

 

 

 

 

 

Date:August 8, 2006