**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

 

**FORM 20-F**

 

**(Mark One)**
| **o**      | ** ** | **Registration  statement pursuant to Section 12(b) or 12(g) of the  Securities Exchange Act of 1934 (Fee required)**                                          |
|------------|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ** ** | ** ** | **or**                                                                                                                                                                                            |
| **ý** | ** ** | **Annual  report pursuant to Section 13 or 15(d) of the  Securities Exchange Act of 1934 for the fiscal year ended December 31,  2004 (No Fee required)** |
| ** ** | ** ** | **or**                                                                                                                                                                                            |
| **o**      | ** ** | **Transaction  report pursuant to Section 13 or 15(d) of the  Securities Exchange Act of 1934 for the transaction period from N/A to N/A  (No Fee required)**  |

 

**Commission file number 333-10976-01**

 

**ONO Finance PLC**

(Exact Name of Registrant as Specified in ItsCharter)

 

**England and Wales**

(Jurisdiction of Incorporation orOrganization)

 

**10 Upper Bank Street, London E14 5JJ**

(Address of Principal Executive Offices)

 

Securities registered or to be registered pursuant to Section 12(b) ofthe Act:

 
| **Title  of each class** | ** ** | **Name  of each exchange on which registered** |
|--------------------------|------------|------------------------------------------------|
| None                     |       | None                                           |

 

Securitiesregistered or to be registered pursuant to Section 12(g) of the Act: **None**

 

Securities forwhich there is a reporting obligation pursuant to Section 15(d) ofthe Act:

 

**€113,702,000 14% Notes Due 2010**

**$58,920,000 14% Notes Due 2011**

**€8,038,000 14% Notes Due 2011**

 

Indicate thenumber of outstanding shares of each of the issuer’s classes of capital orcommon stock as of the close of the period covered by the annual report.

 

**50,000 Ordinary Shares**

 

Indicate bycheck mark whether the registrant: (1) has filed all reports required tobe filed by Section 13 or 15(d) of the Securities Exchange Act of1934 during the proceeding 12 months (or for the shorter period that theregistrant was required to file such reports), and (2) has been subject tosuch filing requirements for the past 90 days.

 
| (1) N/A |   | (2) N/A |
|--------------|--------|--------------|

 

Indicated bycheck mark which financial statement item the registrant has elected to follow.

 
| Item 17 o |   | Item  18 ý |
|----------------|--------|----------------------|

 

 

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ONO Finance PLC (“ONO Finance”) is a company organized under the lawsof England and Wales. In this Annual Report, references to “we,” “us,” and “our”are to ONO Finance. References to the “2010 EUR Notes” are to the € 113,702,00014% Notes due 2010 (“2010 Notes”), references to the “2011 USD Notes” are tothe $58,920,000 14% Notes due 2011, references to the “2011 EUR Notes” are tothe €8,038,000 14% Notes due 2011 (together with the 2011 USD Notes, the “2011Notes”) and references to the “2014 Notes” are to the €180,000,000 10.5% Notesand to the €100,000,000 Euribor 3m + 8.5% Notes due 2014, all issued by ONOFinance. The 2010 Notes, the 2011 Notes and the 2014 Notes are collectivelyreferred to as the “Notes.”

 

**Presentation of Financial and Certain OtherInformation**

 

Unless otherwise indicated or otherwise required by the context, allreferences in this Form 20-F to “EUR,” “euro” or “€” are to the lawfulcurrency in eleven Member States of the European Union. “U.S. dollars,” “dollars,”“U.S.$,” “USD” or “$” are to United States dollars, the lawful currency of theUnited States of America. References to “pounds” or “£” are to British poundssterling, the lawful currency of the United Kingdom.

 

Amounts stated in U.S. dollars, unlessotherwise indicated, have been translated from pounds at an assumed rate solelyfor your convenience, and should not be construed as representations that poundamounts actually represent such U.S. dollar amounts or could be converted intoU.S. dollars at the rate indicated or at any other rate. Unless indicatedotherwise, U.S. dollar amounts have been translated from the pound at the rateof £1.00 = $1.9160, the noon buying rate in New York City for cabletransfers in pounds as certified for customs purposes by the Federal ReserveBank of New York, or the Pound Noon Buying Rate, on December 31, 2004.

 

We maintain our accounting records andprepare our statutory accounts in accordance with generally accepted accountingprinciples in the United Kingdom, or U.K. GAAP. Our audited financialstatements as of December 31, 2003 and 2004 and for the years ended December 31,2002, 2003 and 2004, and, unless otherwise indicated, other financialinformation in this Form 20-F, have been prepared in accordance with U.K.GAAP, which differs in certain significant respects from generally acceptedaccounting principles in the United States, or U.S. GAAP. For a discussion ofthe most significant differences between U.K. GAAP and U.S. GAAP andreconciliations of net income and shareholders’ equity to U.S. GAAP, see note13 of the notes to our financial statements included in this Form 20-F.

 

Certain numerical figures included in the Form 20-Fhave been subject to rounding adjustments; accordingly, numerical figures shownas totals in certain tables may not be an arithmetic aggregation of the figureswhich precede them.

 

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**FurtherInformation**

 

The Notes have been guaranteed by Cableuropa,S.A.U. (“Cableuropa”) and certain of its subsidiaries (collectively, the “ONOGroup”). Information regarding Cableuropa and the other Note guarantors isavailable in Cableuropa’s Form 20-F filed with the Securities and ExchangeCommission on April 27, 2005 (the “Cableuropa Annual Report”). Ourregistered office is located at 10 Upper Bank Street, London E14 5JJ,England.

 

**CAUTIONARYSTATEMENT FOR PURPOSES OF THE “SAFE HARBOR” PROVISIONS OF THE UNITED STATESPRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. This Annual Report on Form 20-Fcontains certain forward looking statements as defined in section 27A ofthe Securities Act and in section 21E of the United States SecuritiesExchange Act of 1934. These forward looking statements are accompanied by, andshould be read in conjunction with, an explanation of factors that could causeactual results to differ materially from those expressed as such forwardlooking statements. By their nature, forward looking statements involve riskand uncertainty, and the factors described in the context of such forwardlooking statements and other factors referred to in this Annual Report on Form 20-F,particularly in Item 4. “Information on the Company” and Item 5. “Operating andFinancial Review and Prospects.” could cause actual results and developments todiffer materially from those expressed in or implied by such forward lookingstatements. We are claiming the benefits of the safe harbor provisions referredto above.**

 

**TABLE OF CONTENTS**

 
| Item 1.   | Identity of Directors, Senior Management  and Advisors                        |   |
|-----------|-------------------------------------------------------------------------------|--------|
| Item 2.   | Offer Statistics and Expected Timetable                                       |   |
| Item 3.   | Key Information                                                               |   |
| Item 4.   | Information on the Company                                                    |   |
| Item 5.   | Operating and Financial Review and  Prospects                                 |   |
| Item 6.   | Directors, Senior Management and Employees                                    |   |
| Item 7.   | Major Shareholders and Related Party  Transactions                            |   |
| Item 8.   | Financial Information                                                         |   |
| Item 9.   | The Offer and Listing                                                         |   |
| Item 10.  | Additional Information                                                        |   |
| Item 11.  | Quantitative and Qualitative Disclosure  about Market Risk                    |   |
| Item 12.  | Description of Securities Other than Equity  Securities                       |   |
| Item 13.  | Defaults, Dividend Arrearages and  Delinquencies                              |   |
| Item 14.  | Material Modifications to the Rights of  Security Holders and Use of Proceeds |   |
| Item 15.  | Controls and Procedures                                                       |   |
| Item 16.  | Reserved                                                                      |   |
| Item 17.  | Financial Statements                                                          |   |
| Item 18.  | Financial Statements                                                          |   |
| Item  19. | Exhibits                                                                      |   |

 

**PART I**

 

**Item1. Identity of Directors, Senior Management and Advisors**

 

Not applicable.

 

**Item2. Offer Statistics and Expected Timetable**

 

Not applicable.

 

**Item 3. KeyInformation**

 

**SelectedFinancial Data**

 

1

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The following summary historical financialinformation presented below under the captions profit and loss account andbalance sheet data is derived from our audited financial statements as of andfor the years ended December 31, 2000, 2001, 2002, 2003 and 2004. Youshould read the following financial information together with our auditedfinancial statements and notes thereto included in Item 18 of this AnnualReport. The financial statements have been prepared in accordance with U.K.GAAP, which differs in certain significant respects from U.S. GAAP. You canfind a description of the most significant differences between U.K. GAAP andU.S. GAAP relevant to us and reconciliations in note 13 of the notes to ourfinancial statements.

 

***Profit and Loss Account***

 
| ** **                                     | ** ** | **Year  ended December 31** | ** ** |
|------------------------------------------------|------------|----------------------------------|------------|
| ** **                                     | ** ** | **2000**                         | ** ** | **2001** | ** ** | **2002** | ** ** | **2003** | ** ** | **2004** | ** ** |
| ** **                                     | ** ** | **£**                       | ** ** | **£** | ** ** | **£** | ** ** | **£** | ** ** | **£** | ** ** |
| Interest receivable and similar income         |       | 44,665,846                       |       | 86,248,879 |   | 88,695,480 |   | 35,432,928 |   | 58,212,304 |   |
| Foreign exchange gains/(losses), net           |       | (11,678                          | )          | (307 | ) | 9,941 |   | 1,300 |   | (309 | ) |
| Interest payable and similar charges           |       | (44,620,397                      | )          | (86,189,430 | ) | (88,629,172 | ) | (35,410,071 | ) | (58,184,051 | ) |
| Profit on ordinary activities before  taxation |       | 33,771                           |       | 59,142 |   | 76,249 |   | 24,157 |   | 27,944 |   |
| Tax on profit on ordinary activities           |       | —                           |       | (17,743 | ) | (9,335 | ) | (4,240 | ) | (5,000 | ) |
| Profit on ordinary activities after  taxation  |       | 33,771                           |       | 41,399 |   | 66,914 |   | 19,917 |   | 22,944 |   |
| Dividend                                       |       | —                           |       | (75,000 | ) | (74,997 | ) | — |   | — |   |
| Retained profit/(loss) for the period          |       | 33,771                           |       | (33,601 | ) | (8,083 | ) | 19,917 |   | 22,944 |   |

 

***Statement of Recognized Gains and Losses***

 
| ** **                                                    | ** ** | **Year  ended December 31,** | ** ** |
|---------------------------------------------------------------|------------|-----------------------------------|------------|
| ** **                                                    | ** ** | **2000**                          | ** ** | **2001** | ** ** | **2002** | ** ** | **2003** | ** ** | **2004** | ** ** |
| ** **                                                    | ** ** | **£**                        | ** ** | **£** | ** ** | **£** | ** ** | **£** | ** ** | **£** | ** ** |
| Profit for the financial period                               |       | 33,771                            |       | 41,399 |   | 66,914 |   | 19,917 |   | 22,944 |   |
| Revaluation of equity value certificates  due from Cableuropa |       | (3,567,713                        | )          | 39,586,078 |   | (30,535,128 | ) | 1,383,148 |   | 6,327 |   |
| Revaluation of equity value certificates  due to bondholders  |       | 3,567,713                         |       | (39,586,078 | ) | 30,535,128 |   | (1,383,148 | ) | (6,327 | ) |
| Profit for the financial period                               |       | 33,771                            |       | 41,399 |   | 66,914 |   | 19,917 |   | 22,944 |   |

 

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**BalanceSheet**

 
| ** **                                               | ** ** | **As  at December 31,** | ** ** |
|----------------------------------------------------------|------------|------------------------------|------------|
| ** **                                               | ** ** | **2000**                     | ** ** | **2001** | ** ** | **2002** | ** ** | **2003** | ** ** | **2004** | ** ** |
| ** **                                               | ** ** | **£**                   | ** ** | **£** | ** ** | **£** | ** ** | **£** | ** ** | **£** | ** ** |
| Debtors: receivable after more than one  year            |       | 374,028,569                  |       | 565,865,404 |   | 572,209,595 |   | 282,912,545 |   | 320,517,571 |   |
| Debtors: receivable within one year                      |       | 26,135,308                   |       | 108,582,822 |   | 59,931,601 |   | 32,170,463 |   | 14,704,154 |   |
| Total debtors                                            |       | 400,163,877                  |       | 674,448,226 |   | 632,141,196 |   | 315,083,008 |   | 335,221,725 |   |
| Cash at bank and in hand                                 |       | 12,475                       |       | 23,863 |   | 85,745 |   | 43,552 |   | 61,820 |   |
| Current assets                                           |       | 400,176,352                  |       | 674,472,089 |   | 632,226,941 |   | 315,126,560 |   | 335,283,545 |   |
| Creditors: amounts falling due within one  year          |       | (22,436,726                  | )          | (29,310,829 | ) | (28,978,215 | ) | (15,419,513 | ) | (10,211,620 | ) |
| Net current assets                                       |       | 377,739,626                  |       | 645,161,260 |   | 603,248,726 |   | 299,707,047 |   | 325,071,925 |   |
| Creditors: amounts falling due after more  than one year |       | (377,677,049                 | )          | (645,132,284 | ) | (603,227,833 | ) | (299,666,237 | ) | (325,008,171 | ) |
| Net assets                                               |       | 62,577                       |       | 28,976 |   | 20,893 |   | 40,810 |   | 63,754 |   |
| Capital and Reserves                                     |       |                         |       |   |   |   |   |   |   |   |   |
| Called up share capital                                  |       | 12,502                       |       | 12,502 |   | 12,502 |   | 12,502 |   | 12,502 |   |
| Profit and loss account                                  |       | 50,075                       |       | 16,474 |   | 8,391 |   | 28,308 |   | 51,252 |   |
| Equity shareholders’ funds                          |       | 62,577                       |       | 28,976 |   | 20,893 |   | 40,810 |   | 63,754 |   |

 

**U.S.GAAP Data:**

 
| ** **                | ** ** | **As  at December 31,** | ** ** |
|---------------------------|------------|------------------------------|------------|
| ** **                | ** ** | **2000**                     | ** ** | **2001** | ** ** | **2002** | ** ** | **2003** | ** ** | **2004** | ** ** |
| ** **                | ** ** | **£**                   | ** ** | **£** | ** ** | **£** | ** ** | **£** | ** ** | **£** | ** ** |
| Net profit/(loss)         |       | 33,771                       |       | 41,399 |   | 66,914 |   | 19,917 |   | 22,944 |   |
| Shareholders’ equity |       | 62,577                       |       | 103,976 |   | 95,890 |   | 40,810 |   | 63,754 |   |

 

**ExchangeRates**

 

For your convenience, this Annual Report contains certain translationsof pounds into U.S. dollars based on the noon buying rate. The noon buying rateis the noon buying rate in New York City for cable transfers in foreigncurrencies as certified for customs purposes by the Federal Reserve Bank of NewYork. The table below provides, for the periods indicated, the period-end,average, high and low exchange rates between the pound and the U.S. dollar,expressed in dollars per pound, based on the noon buying rate. These rates havebeen provided for your convenience and they are not the exchange rates used toprepare the financial statements included in this Annual Report. On December 31,2004, the noon buying rate was £1.00 = U.S.$1.9160.

 
| **Year ended  December 31,** | ** ** | **High**                | ** ** | **Low** | ** ** | **Average  Rate(1)** | ** ** | **End  of Period** | ** ** |
|-----------------------------------|------------|-------------------------|------------|---------|------------|----------------------|------------|--------------------|------------|
| ** **                        | ** ** | **(dollars per pound)** | ** ** |
| 2004                              |       | 1.9482                  |       | 1.7544  |       | 1.8356               |       | 1.9160             |       |
| 2003                              |       | 1.7842                  |       | 1.5500  |       | 1.6450               |       | 1.7842             |       |
| 2002                              |       | 1.6095                  |       | 1.4074  |       | 1.5084               |       | 1.6095             |       |
| 2001                              |       | 1.5045                  |       | 1.3730  |       | 1.4418               |       | 1.4543             |       |
| 2000                              |       | 1.6765                  |       | 1.4514  |       | 1.5667               |       | 1.4515             |       |

 

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(1)           The average rates for each periodreflect the average of the noon buying rates on the last business day of eachmonth during the relevant period.

 

The table below sets forth the high and low exchange rates between thepound and the dollar expressed in dollars per pound, for each of the full sixmonths ending May 31, 2005.

 

3

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| ** ** | ** ** | **High**                           | ** ** | **Low** | ** ** |
|------------|------------|------------------------------------|------------|---------|------------|
| ** ** | ** ** | **(U.S. dollars  per pound)** | ** ** |
| **2005**   |       |                               |       |    |       |
| May        |       | 1.9048                             |       | 1.8205  |       |
| April      |       | 1.9197                             |       | 1.8724  |       |
| March      |       | 1.9292                             |       | 1.8657  |       |
| February   |       | 1.9249                             |       | 1.8570  |       |
| January    |       | 1.9058                             |       | 1.8647  |       |
| **2004**   |       |                               |       |    |       |
| December   |       | 1.9482                             |       | 1.9125  |       |

 

**RiskFactors**

 

*Our business, our ability to pay theprincipal and interest on the Notes and any decision by security holders aresubject to a number of significant risks, including those described below.These risks are not the only ones associated with our business or the Notes.Additional risks not known to us at present or that we currently deemimmaterial may also impair our business operations and our ability to pay theprincipal and interest on the Notes.*

 

***We are a financing entity with no additionaloperations***

 

We are a financing entity with no business operations other than theissuance of debt securities, including the Notes, and the lending of theproceeds of such offerings to the ONO Group under the multi-borrower creditfacilities, or similar agreements (such as the notes proceeds loans). We willrely on payments that the ONO Group must make under the multi-borrower creditfacilities and the notes proceeds loans to provide the funds necessary for usto pay principal and interest on the Notes and to pay our other expenses.Therefore, we are subject to all risks to which the ONO Group is subject, tothe extent such risks could limit their ability to satisfy their obligationsunder the multi-borrower credit facilities and the notes proceeds loans. For adiscussion of other risk factors affecting the Notes and the operations of thebusiness of the ONO Group, see Item 3.D. “Key Information—Risk Factors” of theCableuropa Annual Report on Form 20-F, as filed with the SEC on April 27,2005.

 

**Item4. Information on the Company**

 

**Historyand Development of the Company**

 

We were incorporated on August 20, 1998 as a public limitedcompany with limited liability under the laws of England and Wales. Ourregistered office is at 10 Upper Bank Street, London EC 14 5JJ, England.We are registered as a company with the Registrar of Companies for England andWales with company number 3619149. Our authorized and issued share capital is£50,000 divided into 50,000 ordinary shares with a par value of one pound each,of which two fully-paid shares and 49,998 shares paid up to one quarter havebeen issued.

 

**BusinessOverview**

 

Our principal purpose is to finance the business operations of the ONOGroup. We have conducted no other operations since we were established and willhave no subsidiaries or significant businesses other than the issuance of debtsecurities and are not expected to produce any income except for paymentsreceived from the ONO Group under the multi-borrower credit facilities andnotes proceeds loans. For more information on the business operations of theONO Group, see Item 4 “Information on the Company” of the Cableuropa AnnualReport on Form 20-F, as filed with the SEC on April 27, 2005.

 

**OrganizationalStructure**

 

ONO Finance (Holdings) Limited (“Holdings”),an English private limited company, holds 98% and Cableuropa holds the remaining2% of our share capital. Holdings has a share capital of one pound consistingof a single share of par value one pound and its sole shareholder is RoyalExchange Trust Company Limited (“Retco”), which holds the Holding’s share underthe terms of an English law charitable trust.

 

4

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**Property,Plant and Equipment**

 

We do not own, lease, or otherwise occupy any property.

 

**LegalProceedings**

 

We are currently not party to any legal proceedings.

 

**Item5. Operating and Financial Review and Prospects**

 

**CriticalAccounting Policies**

 

We prepare our financial statements inaccordance with U.K. GAAP, which differ in certain significant respects fromU.S. GAAP. You can find a description of the most significant differencesbetween U.K. GAAP and U.S. GAAP relevant to us and reconciliations of netincome and shareholders’ equity in note 13 of the notes to our financialstatements. The preparation of financial statements in conformity with U.K.GAAP requires the use of estimates and assumptions that affect the reportedamounts of assets and liabilities, including disclosure of contingent assetsand contingent liabilities, at the date of the financial statements and thereported amounts of revenue and expenses during the reporting period. Becauseof the uncertainty of factors surrounding the estimates or judgments used inthe preparation of the financial statements, actual results may vary from theseestimates.

 

For a summary of all of our significantaccounting policies, including the critical accounting policies discussedbelow, see note 1, Accounting Policies, to our financial statements.

 

***Loans***

 

Borrowings are included as liabilities in thebalance sheet at their proceeds, net of discount and expenses. The expenses anddiscount are charged to loan interest in the profit and loss account over theterm of the borrowing, using the effective interest method. Funds on lent tothe ONO Group are accounted for in exactly the same manner in order to matchthe borrowing and the debtor treatment. Our ability to meet our debtobligations is dependent on the ONO Group meeting its debt obligations to usunder the multi-borrowers credit facilities and notes proceeds loans.

 

***Foreign exchange***

 

Transactions in foreign currencies aretranslated into British pounds sterling at the rates of exchange current at thedates of the transactions. Foreign currency monetary assets and liabilities inthe balance sheet are translated into sterling at the rates of exchange rulingat the end of the year. The resulting gain or loss is included as an exchangegain or loss in the profit and loss account. Any exchange loss will be offsetby exchange gains.

 

**Resultsof Operations**

 

We are a financing entity whose principalbusiness is to finance the business operations of the ONO Group. We haveconducted no other operations since we were established and expect not to havesubsidiaries or significant businesses other than the issuance of debtsecurities and are not expected to provide any income except payments receivedfrom the ONO Group under the multi-borrower credit facilities and the notesproceeds loans. Our significant business events during 2004 were a new bondissuance on May 17, 2004 for €280 million split between €100 million offloating rates notes priced at three month Euribor plus a margin of 8.5%, and€180 million of fixed rate notes priced at 10.5% and the cancellation of asignificant portion of the Notes purchased during May and June 2004.

 

5

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After these transactions, the following Notesremain outstanding:

 
| ** **                   | ** ** | **Thousand of Euro or US$ (as  applicable)** | ** ** |
|------------------------------|------------|---------------------------------------------------|------------|
| ** **                   | ** ** | **Outstanding Bonds**                             | ** ** | **Outstanding Loans  to the Cableuropa Group** | ** ** |
| ** **                   | ** ** | **Face**                                          | ** ** | **Interest Rate** | ** ** | **Total loan @  maturity** | ** ** | **Interest  Rate** | ** ** |
|                         |       |                                              |       |   |   |   |   |   |   |
| Euro Notes due 2010          |       | 113,702                                           |       | 14.00 |   | 113,702 |   | 14.010 |   |
| Euro Notes due 2011          |       | 8,038                                             |       | 14.00 |   | 8,038 |   | 16.252 |   |
| US$ Notes due 2011      |       | 58,920                                            |       | 14.00 |   | 58,920 |   | 16.252 |   |
| Euro Fixed Notes due 2014    |       | 180,000                                           |       | 10.50 |   | 180,000 |   | 10.510 |   |
| Euro Floating Notes due 2014 |       | 100,000                                           |       | Euribor +  8.5 | % | 100,000 |   | Euribor +  8.51 | % |

 

For a discussion on the operating andfinancial review and prospects of the ONO Group, see Item 5. “Operating and FinancialReview and Prospects” of Cableuropa’s Annual Report on Form 20-F, as filedwith the SEC on April 27, 2005.

 

**Item6. Directors, Senior Management and Employees**

 

**Directors**

 

The following table shows information regarding our directors:

 
| **Name**                     | ** ** | **Age** | ** ** | **Title** | ** ** | **Member  of Board  of Director Since** | ** ** | **Termination**                    | ** ** |
|------------------------------|------------|---------|------------|-----------|------------|-----------------------------------------|------------|------------------------------------|------------|
| Bryan Donald Needham         |       | 61      |       | Director  |       | 1999                                    |       | Resigned on  15 July 2004     |       |
| Peter Michael Hills          |       | 49      |       | Director  |       | 2000                                    |       | Deceased on  12 December 2004 |       |
| Capita Trust Company Limited |       | n/a     |       | Director  |       | 15 July 2004                       |       | n/a                                |       |
| Adrian Walton Gower          |       | 43      |       | Director  |       | 12  December 2004                  |       | n/a                                |       |

 

**Adrian Walton Gower**, is a Director of Capita TrustCompany Limited and head of Corporate Trust which administers a wide range ofCorporate Trusts including securitizations. Mr. Gower is a Director of anumber of companies through the involvement of Capita IRG Trustees Limited andCapita Trust Company Limited in securitizations (see below).

 

**Capita Trust Company Limited,** a subsidiary of The Capita Group,administers a wide range of Corporate Trusts including securitizations. CapitaTrust Company Limited is a Director of a number of companies through theinvolvement of Capita IRG Trustees Limited in securitizations (see below).

 

The following table shows information regarding the main outsideactivities currently undertaken by our directors.

 
| **Name**             | ** ** | **Main  Activities outside ONO Finance**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|----------------------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Adrian  Walton Gower |       | Adrian Gower serves as  director for the following companies:  Aire Valley Finance (No. 2) Plc; Aire Valley Finance Plc; Aire Valley  Trustees (No 2) Limited; Anglia Funding Limited; Anglia Options Limited;  Artesian Finance II Plc; Artesian Finance Plc; Burra Limited; Capita  Consortium Nominees No. 1 Limited; Capita Consortium Nominees No. 2  Limited; Capita Consortium Nominees No. 3 Limited; Capita Trust Company  Limited; Capita Trust Corporate Limited; Capita Trust Nominees No.1 Limited Capita  Trust Nominees No.2 Limited; Capita Trust Secretaries Limited; Southern  Pacific Securities 05-2 Parent Limited; Southern Pacific Financing 05-B Parent  Limited; Dee Valley Water (Holdings) Limited; Epic (Caspar) Holdings Limited;  Epic (Caspar) Options Limited Epic (Caspar) Plc; EPIC (Unite) Holdings Plc;  EPIC (Unite) Options Limited; EPIC (Unite) Plc; Festival Funding Limited;  Fiesta Funding Limited; Finance For Higher Education |

 

6

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|   |   | Limited; Finance for  Mortgages Limited; Finance For Residential Social Housing (Holdings) Limited;  Finance For Residential Social Housing Plc; First Finance London Ltd; First  Securitisation Company Limited; Gallaher Asset Finance 2000 Limited; GHG  Finance Limited; Gracechurch Card Funding (No. 1) Plc; Gracechurch  Mortgage Finance (No. 2) Plc Gracechurch Mortgage Finance (No. 3)  Plc; Gracechurch Mortgage Finance Plc; Gracechurch Mortgage Trustee  (No. 1) Limited; Gracechurch Mortgage Trustee (No. 2) Limited;  Gracechurch Mortgages (Holdings) Limited; Gracechurch Personal Loan Finance  (No. 1) Plc; Gracechurch Receivable (Holdings) Limited; Gracechurch  Receivable Trustee Limited; Guaranteed Export Finance Corporation Plc; H.A  Funding Limited; Higher Education Securitised Investment  Series (Holdings) Limited; The Higher Education Securitised Investments  Series No. 1 Plc; The Housing Association Funding Plc; HSMS; Hurst  UK Finance Limited; Investors Finance Company (Holdings) Limited; Investors  Finance Company Plc; L.A.B Investments (Holdings) Ltd; L.A.B Investments Plc;  Leek Finance Holdings Number Eight Limited; Leek Finance Holdings Number  Eleven Limited; Leek Finance Holdings Number Fifteen Limited; Leek Finance  Holdings Number Five Limited; Leek Finance Holdings Number Four Limited; Leek  Finance Holdings Number Fourteen Limited; Leek Finance Holdings Number Nine  Limited; Leek Finance Holdings Number Seven Limited; Leek Finance Holdings  Number Six Limited; Leek Finance Holdings Number Sixteen Limited; Leek  Finance Holdings Number Ten Limited; Leek Finance Holdings Number Three  Limited; Leek Finance Holdings Number Twelve Limited; Leek Finance Holdings  Number Two Limited; Leek Finance Number Eight Limited; Leek Finance Number  Eleven Plc; Leek Finance Number Fifteen Plc; Leek Finance Number Five  Limited; Leek Finance Number Four Limited; Leek Finance Number Fourteen plc;  Leek Finance Number Nine Limited; Leek Finance Number Seven Plc; Leek Finance  Number Six Limited; Leek Finance Number Sixteen Plc; Leek Finance Number Ten  Plc; Leek Finance Number Three Plc; Leek Finance Number Twelve Plc; Leek  Finance Number Two Plc; Lothbury Funding No. 1 Plc; Maple Mortgages  Holdings Limited; Maple Mortgages Securities No 1 Plc; Meadowhall CMR Finance  Plc; Meadowhall CMR Holdings Limited; Meerbrook Finance Holdings Number One  Limited; Meerbrook Finance Holdings Number Two Limited; Meerbrook Finance  Number One Limited; Meerbrook Finance Number Two Limited; Meridian VAT  Trustees Limited; Merrion Square (Holdings) Limited; Millennium Link Trust;  Monument MT No. 1 Limited; Monument MT No. 2 Limited; Monument  Options No. 1 Limited; Monument Post-Enforcement No. 2 Limited;  Monument Securitisation (CMBS) No. 1 Plc; Monument Securitisation (CMBS)  No.1 Plc; Monument Securitisation (CMBS) No.2 Limited; Monument  Securitisation Holdings Limited; Monument Securitisation Holdings No. 2  Limited; Morgan Stanley Mortgage Finance (Broadgate) Plc; Mortgage Express  (No. 2); Mortgage Express Holdings; Mortgage Platforms Asset Sale 1  Limited; Mortgages No.1 (Holdings) Limited; Mortgages No.1 (Options) Limited;  Mortgages No.1 Plc; Mortgages No.2 (Holdings) Limited; Mortgages No.2  (Options) Limited; Mortgages No.2 Plc; Mortgages No.3 (Holdings) Limited;  Mortgages No.3 (Options) Limited; Mortgages No.3 Plc; Mortgages No.4  (Holdings) Limited; Mortgages No.4 (Options) Limited; Mortgages No.4 Plc;  Mortgages No.5 (Holdings) Limited; Mortgages No.5 (Options) Limited;  Mortgages No.5 Plc; Mortgages No.6 (Holdings) Limited; Mortgages No.6  (Options) Limited; Mortgages No.6 Plc; Non Conforming Mortgages 1 Plc;  Norland DACS 14 Limited; Norland DACS 18 Limited; Norland DACS 11 Limited;  Norland DACS 13 Limited; Norland DACS 15 Limited; Norland DACS 16 Limited;  Norland DACS 17 Limited; Norland DACS 19 Limited; Norland DACS 20 Limited;  ONO Finance(Holdings) Limited; Orchardbrook Limited; Orvieto Limited; Phoenix  Funding Plc; Plaster Limited; Platform Home Loans No. 2 Plc; Platform  Home Loans Options Limited; Platform Homes Loans Holdings Limited; Platform  Homes Loans Holdings No. 2 Limited; Platform Homes Loans No. 1 Plc;  Platform Homes Loans Options No. 2 Limited; Plum Sterling No. 1  Plc; PMAC Funding 05-1 Limited; PMAC Holdings 05-1 Limited; Residential  Mortgage Securities 10 Plc; Residential Mortgage Securities 11 Plc;  Residential Mortgage Securities 12 Plc; Residential Mortgage Securities 13  Plc; Residential Mortgage Securities 14 Plc; Residential Mortgage Securities |
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|                          |   | 15 Plc; Residential  Mortgage Securities 16 Plc; Residential Mortgage Securities 17 Plc;  Residential Mortgage Securities 18 Plc; Residential Mortgage Securities 19  Plc; Residential Mortgage Securities 20 Plc; Residential Mortgage Securities  8 Plc; Residential Mortgage Securities 9 Plc; Residential Mortgage Securities  Limited; Residential Property Securities No. 3 Plc; Residential Property  Securities No. 4 Plc; Residential Property Securities No. 5 Plc;  RMS 11 Limited; RMS 11 Options Limited; RMS 12 Limited; RMS 12 Options  Limited RMS 13 Limited; RMS 13 Options Limited; RMS 14 Limited; RMS 14  Options Limited; RMS 15 Limited; RMS 15 Options Limited; RMS 16 Limited; RMS  16 Options Limited; RMS 17 Limited; RMS 17 Options Limited; RMS Options  Limited; RMS Options X Limited; RMS X Limited; RSL Finance (Holdings)  Limited; RSL Finance (No. 1) Plc; Rudyard Finance Holdings Number One  Limited; Rudyard Finance Number One Plc; Sarfu Limited; Scotlife Home Loans  (No 2) Limited; Securitisation of Catalogue Assets (UK) Limited;  Securitisation of Financial Assets Limited; Silhouette Mortgages Limited;  Southern Pacific 04-1 Parent Limited; Southern Pacific 04-2 Parent Limited;  Southern Pacific 04-A Parent Limited; Southern Pacific 04-B Parent Limited;  Southern Pacific 05-1 Parent Limited; Southern Pacific 05-A Parent Limited;  Southern Pacific A Limited; Southern Pacific B Limited; Southern Pacific D  Parent Limited; Southern Pacific E Parent Limited; Southern Pacific F Parent  Limited; Southern Pacific Financing 04-A Plc; Southern Pacific Financing 04-B  (F) Limited; Southern Pacific Financing 04-B Plc; Southern Pacific  Financing 05-A (F) Limited; Southern Pacific Financing 05-A Plc;  Southern Pacific G Parent Limited; Southern Pacific H Parent Limited; Southern  Pacific Securities 04-1 Plc; Southern Pacific Securities 04-2 Plc; Southern  Pacific Securities 05-1 Plc; Southern Pacific Securities A Plc; Southern  Pacific Securities C Plc; Southern Pacific Securities D Plc; Southern Pacific  Securities E Plc; Southern Pacific Securities F Plc; Southern Pacific  Securities G Plc; Southern Pacific Securities H Plc; Southern Pacific  Securities 05-2 Plc; Southern Pacific Financing 05-B Plc; SP Options Limited;  Spicedeck Limited; St James’ Park Finance Limited; Truck and Receivables  Securitisation Limited; Valesco Funding Plc; Werretown Supermarkets  Securitisations (Holdings) Ltd; Werretown Supermarkets Securitisations Plc;  White City Property Nominee Limited; White City Property Trustees Limited |
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|                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Capita Trust  Company Limited |   | Capita Trust Company Limited serves as  director for the following companies:  Aire Valley Finance (No 2) Plc; Aire Valley Finance Plc; Aire Valley Trustees  (No 2) Limited; Anglia Funding Limited; Anglia Options Limited; Artesian  Finance II Plc; Artesian Finance Plc; Capita Trust Secretaries Limited; City  Aviation Finance Limited; Corkview Limited; Crimsonpoint Limited; Dee Valley  Water (Holdings) Limited; Epic (Caspar) Holdings Limited; Epic (Caspar)  Options Limited; Epic (Caspar) Plc; Epic (UNITE) Holdings Limited; Epic  (Unite) Options Limited; Epic (UNITE) Plc; Fiesta Funding Limited; Finance  For Residential Social Housing plc; Finance For Higher Education Limited;  Finance for Mortgages Limited; Finance for Residential Social Housing  (Holdings) Limited; First Finance London Ltd; Fizzgrange Limited; Gracechurch  Card Funding (No. 1) Plc; Gracechurch Mortgage Finance (No. 2) Plc;  Gracechurch Mortgage Finance (No. 3) Plc; Gracechurch Mortgage Finance  Plc; Gracechurch Mortgage Trustee (No. 1) Limited; Gracechurch Mortgage  Trustee (No. 2) Limited; Gracechurch Mortgages (Holdings) Limited;  Gracechurch Personal Loan Finance (No. 1) Plc; Gracechurch Receivable  (Holdings) Limited; Gracechurch Receivable Trustee Limited; H A Funding  Limited; Higher Education Securitised Investments Series (Holdings)  Limited (The); Higher Education Securitised Investments Series No.1 Plc  (The); Housing Association Funding Plc; HSMS; Hurst UK Finance Limited;  Investors Finance Company (Holdings) Limited; Investors Finance Company Plc;  L.A.B Investments (Holdings) Ltd; L.A.B Investments Plc; Leek Finance  Holdings Number Eight Limited; Leek Finance Holdings Number Eleven Limited;  Leek Finance Holdings Number Five Limited; Leek Finance Holdings Number Four  Limited; Leek Finance Holdings Number Fourteen Limited; Leek Finance Holdings  Number Nine Limited; Leek Finance Holdings Number Seven Limited; Leek Finance  Holdings Number Six Limited; Leek Finance Holdings Number Ten Limited; Leek  Finance                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |

 

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|   |   | Holdings Number Three  Limited; Leek Finance Holdings Number Twelve Limited; Leek Finance Holdings  Number Two Limited; Leek Finance Number Eight Limited; Leek Finance Number  Eleven Plc; Leek Finance Number Five Limited; Leek Finance Number Four  Limited; Leek Finance number Fourteen Plc; Leek Finance Number Nine Limited;  Leek Finance Number Seven Plc; Leek Finance Number Six Limited; Leek Finance  Number Ten Plc; Leek Finance Number Three Plc; Leek Finance Number Twelve  Plc; Leek Finance Number Two Plc; Maple Mortgages Holdings Limited; Maple  Mortgages Securities No 1 Plc; Meadowcroft CMR Holdings Limited; Meadowhall  CMR Finance plc; Meerbrook Finance Holdings Number Two Limited; Meerbrook  Finance Holdings Numbers One Limited; Meerbrook Finance Number One Limited;  Meerbrook Finance Number Two Limited; Monument MT No. 1 Limited;  Monument Options No. 1 Limited; Monument Post-Enforcement No. 2  Limited; Monument Securitisation (CMBS) No. 1 Plc; Monument  Securitisation Holdings Limited; Monument Securitisation Holdings No. 2  Limited; Morgan Stanley Mortgage Finance (Broadgate) Plc; Mortgage Express  (No 2); Mortgage Express Holdings; Mortgage Platforms Asset Sale 1 Limited;  Mortgages No 1 (Holdings) Limited; Mortgages No 1 (Options) Limited; Mortgages  No 1 Plc; Mortgages No 2 (Holdings) Limited; Mortgages No 2 (Options)  Limited; Mortgages No 2 Plc; Mortgages No 3 (Holdings) Limited; Mortgages No  3 (Options) Limited; Mortgages No 3 Plc; Mortgages No 4 (Holdings) Limited;  Mortgages No 4 (Options) Limited; Mortgages No 4 Plc; Mortgages No 5  (Holdings) Limited; Mortgages No 5 Plc; Mortgages No 6 (Holdings) Limited;  Mortgages No 6 (Options) Limited; Mortgages No 6 Plc; Non-Conforming  Mortgages 1 Plc; Norland DACS 11 Limited ; Norland DACS 13 Limited; Norland  DACS 14 Limited; Norland DACS 15 Limited; Norland DACS 16 Limited; Norland  DACS 17 Limited; Norland DACS 18 Limited; Norland DACS 19 Limited; Norland  DACS 20 Limited; ONO Finance (Holdings) Limited; Orchardbrook Limited;  Orvieto Limited; Plaster Limited; Platform Home Loans No 1 Plc; Platform Home  Loans No 2 Plc; Plum Sterling No 1 Plc; PMAC Funding 05-1Limited; PMAC  Holdings 05-1 Limited; Residential Mortgage Securities 1 plc; Residential  Mortgage Securities 10 plc; Residential Mortgage Securities 11 plc; Residential  Mortgage Securities 12 plc; Residential Mortgage Securities 13 plc;  Residential Mortgage Securities 14 plc; Residential Mortgage Securities 15  plc; Residential Mortgage Securities 16 PLC; Residential Mortgage Securities  17 plc; Residential Mortgage Securities 18 plc; Residential Mortgage  Securities 19 Plc; Residential Mortgage Securities 2 plc; Residential  Mortgage Securities 20 Plc; Residential Mortgage Securities 3 plc;  Residential Mortgage Securities 4 plc; Residential Mortgage Securities 5 plc;  Residential Mortgage Securities 6 plc; Residential Mortgage Securities 7 plc;  Residential Mortgage Securities 8 plc; Residential Mortgage Securities 9 plc;  Residential Mortgage Securities Limited; Residential Mortgage Securities  Limited; RMS 10 Limited; RMS 10 Options Limited; RMS 11 Limited; RMS 11  Options Limited; RMS 12 Limited; RMS 12 Options Limited; RMS 13 Limited; RMS  13 Options Limited; RMS 14 LIMITED; RMS 14 OPTIONS LIMITED; RMS 15 LIMITED;  RMS 15 OPTIONS LIMITED; RMS 16 LIMITED; RMS 16 OPTIONS LIMITED; RMS 17  Limited; RMS 17 Options Limited; RMS 2 Limited; RMS 2 Options Limited; RMS 3  Limited; RMS 3 Options Limited; RMS 4 Limited; RMS 4 Options Limited; RMS 5  Limited; RMS 5 Options Limited; RMS 6 Limited; RMS 6 Options Limited; RMS 7  Limited; RMS 7 Options Limited; RMS 8 Limited; RMS 8 Options Limited; RMS  Options limited; RMS Options limited; RMS Options X Limited; RMS X limited;  RSL Finance (Holdings) Limited; RSL Finance (No. 1) Plc; Rudyard Finance  Holdings Number One Limited; Rudyard Finance Number One Plc; Scotlife Home  Loans (No 2) Limited; Securitisation of Catalogue Assets (UK) Limited;  Securitisation of Financial Assets Ltd; Silhouette Mortgages Limited;  Southern Pacific 04-1 Parent Limited; Southern Pacific H Parent Limited;  Southern Pacific 04-2 Parent Limited; Southern Pacific 04-2 Parent Limited;  Southern Pacific 04-B Parent Limited ; Southern Pacific 05-1 Parent Limited;  Southern Pacific A Ltd; Southern Pacific A04-A Parent Limited; Southern  Pacific B Limited; Southern Pacific D Parent Limited; Southern Pacific E  Parent Limited; Southern Pacific E Parent Limited; Southern Pacific F Parent  Limited; Southern Pacific Financing 04-A Plc; Southern Pacific Financing 04-B  (F) Limited ; |
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|   |   | Southern Pacific Financing  04-B Plc; Southern Pacific G Parent Limited; Southern Pacific H Parent  Limited; Southern Pacific Securities 04-1 Plc; Southern Pacific Securities 04-2  Plc; Southern Pacific Securities 04-2 Plc; Southern Pacific Securities 05-1  Plc; Southern Pacific Securities A plc; Southern Pacific Securities C Plc;  Southern Pacific Securities D Plc; Southern Pacific Securities E Plc;  Southern Pacific Securities E Plc; Southern Pacific Securities F Plc;  Southern Pacific Securities G Plc; Southern Pacific Securities H Plc; SP  Options Limited; Spicedeck Limited; St James’ Park Finance Limited;  Teesmartin High Wycombe GP Limited; Teesmartin High Wycombe LP2 Limited;  Tussauds Intermediate Holdings Limited; Werretown Supermarkets  Securitisations (Holdings) Limited; Werretown Supermarkets Securitisations  Plc; White City Property Nominee Limited; White City Property Trustees  Limited; Widebright Plc |
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**Compensation**

 

For the year ended December 31, 2004, we did not pay anycompensation to our directors or executive officers.

 

**BoardPractices**

 

There is no current provision to provide compensation to our directorsupon expiration or termination of their service.

 

***Audit and Compliance Committee***

 

Our full board of directors functions as our audit committee.

 

**Employees**

 

We do not have any employees.

 

**Item7. Major Shareholders and Related Party Transactions**

 

**MajorShareholders**

 

ONO Finance (Holdings) Limited holds 49,000 shares of ONO Finance, or98% of its shares, and Cableuropa holds the remaining 2% of its shares.

 

ONO Holdings’ articles of association and its memorandum ofassociation:

 

•                  limit ONOHoldings’ activities to borrowing funds from Cableuropa to purchase and holdour shares, as well as other activities incidental thereto;

 

•                  prohibit thetransfer of ONO Holdings’ shares to any party other than to Retco, to be heldunder the terms of the charitable trust, or to Cableuropa;

 

•                  prohibit thetransfer of the issuer’s shares held by ONO Holdings to any party other thanRetco, or Cableuropa; and

 

•                  prohibit ONO Holdingsfrom issuing any securities, other than the initial issuance of its sharecapital to Retco, or otherwise to incur any indebtedness, other than a loanfrom Cableuropa sufficient to cover the costs of purchasing our shares andcosts incidental to our maintenance and the maintenance of ONO Holdings.

 

**RelatedParty Transactions**

 

***Multi-Borrower Credit Facilities and NotesProceeds Loans***

 

We and the members of the ONO Group have entered into the multi-borrowercredit facilities and the notes proceeds loans, pursuant to which we have lentto the ONO Group (the borrowers), an amount equal to the gross proceeds of theoffering of

 

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each of ourNotes. A portion of the gross proceeds of the offering of each of our Notes hasbeen applied, on the instructions of the borrowers, to pay us an up-front fee,which enabled us to pay the fees and commissions and other expenses of therelevant offering. The borrowers have appointed Cableuropa to act as theiragent in connection with the multi-borrower credit facilities and notesproceeds loans.

 

*Principal, Maturity and Interest*

 

The multi-borrower credit facilities and the notes proceeds loansspecify the amount of the loans provided to the borrowers. At Cableuropa’sdiscretion as agent, loans may be prepaid by a borrower so long as such amountis reborrowed immediately by another borrower. Amounts drawn under the multi-borrowercredit facilities and the notes proceeds loans accrue interest at fixed orvariable rates which substantially mirror interest accrued on the Notes.Amounts due under the multi-borrower credit facilities and the notes proceedsloans will be payable by the borrowers to us in order that we, upon receipt ofsuch amounts, will be able to satisfy our obligations to pay principal andinterest on the Notes. Amounts due under the multi-borrower credit facilitiesand the notes proceeds loans are payable to us concurrently with ourobligations to make payments in respect of the Notes. Accordingly, the multi-borrowercredit facilities and the notes proceeds loans contain provisions that matchthe optional and compulsory redemption provisions contained in the indentures.In addition, the multi-borrower credit facilities and the notes proceeds loansprovide for an arrangement fee to be charged to the borrowers by ONO Holdingsout of which ONO Holdings will pay our corporate maintenance and otherexpenses. The multi-borrower credit facilities and the notes proceeds loansalso provide for the payment of such additional amounts as may be necessary sothat the net amount we receive will not be less than amounts which we areentitled to receive if certain taxes or other payments were not required.

 

*Joint and Several Liability of the Borrowers*

 

Under the multi-borrower credit facilities and the notes proceedsloans, the borrowers are jointly and severally liable to us to pay principal,interest and any other amounts due.

 

***Additional Related Party Transactions***

 

As discussed in Item 5, our principal purpose is to finance the businessoperations of the ONO Group. Our related party transactions include the fixedand variable Notes issued in May 2004 and lent to Cableuropa under thenotes proceeds loans. For more information on these transactions, see Item 5. “OperatingFinancial Review and Prospects—Results of Operations” of this report, Item 10. “AdditionalInformation—Material Contracts” of the Cableuropa Annual Report on Form 20-F,as filed with the SEC on April 27, 2005 and ONO Finance plc financialstatements included in this report.

 

***Interests of Experts and Counsel***

 

Not applicable.

 

***Sarbanes-Oxley Act of 2002***

 

As we have only registered our Notes under the U.S. Securities Act of1933 (and not the U.S. Securities Exchange Act of 1934) and have, to the bestof our knowledge, fewer than 300 U.S. security holders of record, we are notconsidered an “Issuer” for purposes of the Sarbanes-Oxley Act. Therefore,certain provisions of the Sarbanes-Oxley Act do not apply to us. However, weare obligated under our indentures relating to the Notes to file our reports inaccordance with the requirements of Form 20-F. Therefore, although we arenot statutorily obligated to comply with certain provisions of the Sarbanes-OxleyAct, we have chosen to comply with certain provisions in connection with thefiling of our Form 20-F.

 

**Item8. Financial Information**

 

For our financial information, please see the section entitled “Item18. Financial Statements.”

 

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**Item9. The Offer and Listing**

 

**Markets**

 

The Notes trade on the Luxembourg Stock Exchange and are eligible to betraded in the Private Offerings, Resales, and Trading through AutomaticLinkages (“Portal”) Market.

 

**Item10. Additional Information**

 

**Memorandumand Articles of Association**

 

***Objects and Purposes***

 

Our articles of association and memorandum of association were adoptedon February 3, 1999 and state that our purpose is to (and our activitiesare limited to) issue the Notes, or other debt securities in the future, andlend the proceeds of the Notes to the ONO Group, as well as other activitiesrelating to the issuance of the Notes and lending the proceeds of the Notes.

 

***Conflict-of-Interest Transactions***

 

Under the U.K. Companies Act 1985 (the “Act”), it is the duty of adirector who is in any way, whether directly or indirectly, interested in acontract or proposed contract with the company to declare the nature of thatinterest at a meeting of the directors of the company. Such declaration shallbe made at the meeting of directors at which the question of entering into thecontract is first considered or, if the director is not at that time theninterested, at the next meeting of the directors held after becoming sointerested. This is backed up in our articles of association.

 

Our articles of association further state that a director may not voteon or be counted in the quorum in relation to resolutions of the board or ofthe committee of the board concerning a contract, arrangement, transaction orproposal to which we are or are to be a party and in which we have an interestwhich is, to our knowledge, a material interest other than in certain specifiedcircumstances.

 

***Election of Directors***

 

Directors may be appointed by ordinary resolution of the board of ONOFinance. A director appointed by the board holds office only until thedissolution of the next annual general meeting after his appointment (unless heis reappointed during that meeting). Our directors were appointed by ordinaryresolution of ONO Finance.

 

***Director Qualifications***

 

Our articles of association provide that no person is incapable ofbeing appointed a director by reason of having reached the age of 70. Thisdisapplies section 293 of the Act that provides that no person is capableof being appointed a director of a company if, at the time of the appointment,he has attained the age of 70. According to our articles of association, thedirectors are not required to hold our shares.

 

***Calling a Shareholders’ Meeting***

 

The directors are obliged to call an annual general meeting once ineach calendar year. Additionally, the board must convene an extraordinarygeneral meeting immediately on receipt of a written request from shareholdersholding at least 10% of our shares, in accordance with the Act.

 

The directors are obliged to take action to convene the meeting within21 days and the meeting must be held within 28 days of the notice ofmeeting being sent out, *i.e.,* themaximum permitted delay between receipt of the requisition and day of themeeting is seven weeks. If the directors do not take the required action therequisitionists themselves can call their meeting and the meeting must takeplace within three months of the date of the original request.

 

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***Shareholders’ Meetings***

 

The directors are obliged to call an annual general meeting once ineach calendar year. Subject to any special terms as to voting on which shareshave been allotted or issued, at a general meeting every shareholder present inperson has, on a show of hands, one vote. Every shareholder present in personor by proxy has, on a poll, one vote for every share of which it is the holder.

 

The quorum for a general meeting is two shareholders present in personor by proxy and entitled to vote.

 

***Vote Required for Extraordinary Transactions***

 

Shareholders can act by ordinary resolution (simple majority) unlessrequired by the Act or our articles of association to pass another type ofresolution. The Act insists that for certain decisions only a certain type ofresolution is adequate, *e.g.,* aspecial resolution is needed to change the name or articles of association of acompany. A special resolution requires a 75% majority to be passed. This meansthat on such a vote, by a show of hands, at least three quarters of the numberof shareholders present must vote in favor, and by a poll, 75% of the votes ofthose shareholders or their proxies present and voting must be in favor of theresolution. The main occasion on which an extraordinary resolution is requiredoccurs when the shareholders wish to pass a resolution to put the company intovoluntary liquidation.

 

***Dividends***

 

Subject to the provisions of the Act, we may by ordinary resolutiondeclare dividends to be paid to shareholders in accordance with theirrespective rights and interests, provided that no dividend may exceed theamount recommended by the board.

 

***Shareholder Actions by Written Consent***

 

Our articles of association provide that a resolution in writingexecuted by or on behalf of each shareholder who would have been entitled tovote upon it if it had been proposed at a general meeting at which he waspresent is as effective as if it had been passed at a general meeting of theCompany duly convened and held.

 

***Shareholders’ Proposals***

 

Under the Act any shareholder(s) owning 5% or more of our shareshas/have the right to have an item placed on the agenda for an annual generalmeeting. The request must be given to us in writing six weeks prior to theannual general meeting. The requisition must be signed and left at our registeredoffice together with a sum of money to cover our expenses (although the generalmeeting may later vote that this sum of money be returned).

 

***Voting Rights***

 

The Articles include provisions to the following effect:

 

•                  on a show ofhands every member at a general meeting who (being an individual) is present inperson, or (being a corporation) is present by a representative, has one vote;

 

•                  on a poll everymember present in person or by proxy or by representative has one vote for eachshare of which he is the holder; and

 

•                  in the case ofjoint holders, the vote of the person whose name stands first in the registerof members and who tenders a vote is accepted to the exclusion of any votestendered by any other joint holders.

 

At a general meeting, a resolution put to the vote of the meeting isdecided by a show of hands unless (before or on the declaration of the resultof the show of hands) a poll is properly demanded. Unless a poll is demandedand the demand is not withdrawn, a declaration by the chairman that theresolution has been carried, or carried by a particular majority, or lost ornot carried by a particular majority, is conclusive evidence of the factwithout proof of the number or proportion of the votes recorded in favor of oragainst the resolution.

 

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Subject to the Act, a poll may be demanded on any question by:

 

•                  the chairman ofthe meeting;

 

•                  not less thanfive members present in person or by proxy and entitled to vote;

 

•                  a member or memberspresent in person or by proxy representing in aggregate not less than one-tenthof the total voting rights of all the members having the right to vote at themeeting; or

 

•                  a member ormembers present in person or by proxy holding shares conferring a right to voteat the meeting, being shares on which an aggregate sum has been paid up equalto not less than one-tenth of the total sum paid up on all the sharesconferring that right.

 

***Limitations on Share Ownership***

 

Our articles of association and memorandum of association prohibit thetransfer of our shares to any party other than ONO Holdings, Retro, to be heldunder the terms of the charitable trust, or Cableuropa.

 

***Changes in Capital***

 

We may by way of ordinary resolution passed at our general meeting:

 

•                  increase ourshare capital by a sum to be divided into shares of an amount prescribed by theresolution;

 

•                  consolidate anddivide all or any of our share capital into shares of a larger amount;

 

•                  subject to theAct, sub-divide all or part of our shares into shares of a smaller amount andmay by the resolution decide that the shares resulting from the sub-divisionhave among themselves a preference or other advantage or be subject to arestriction; and

 

•                  cancel any shareswhich have not, at the date of the ordinary resolution, been taken or agreed tobe taken by a person and diminish the amount of our share capital by the amountof the shares so cancelled.

 

Subject to the Act and the rights attached to existing shares, we mayalso:

 

•                  by special resolution,reduce our share capital, any capital redemption reserve or shares premiumaccount; and

 

•                  subject to therequirements of the UK Listing Authority, purchase, or agree to purchase in thefuture, our own shares.

 

***Variation of Rights***

 

Subject to the Act, whenever our share capital is divided intodifferent classes of shares, all or any of the rights for the time beingattached to any class of shares may be varied, as provided by those rights or,if there is no such provision, then either with the consent in writing of theholders of at least three-fourths in nominal value of the issued shares of thatclass or with the sanction of an extraordinary resolution passed at a separategeneral meeting of the holders of the issued shares of that class validly heldin accordance with the Articles. The rights attached to a class of shares arenot, unless otherwise expressly provided by those rights, deemed to be variedby the creation, allotment or issue of further shares ranking equally with orsubsequent to them or by the purchase or redemption by us of our own shares inaccordance with the Act and the Articles.

 

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**MaterialContracts**

 

For a discussion of the material contracts affecting us and the ONOGroup, see Item 10 “Additional information – Material Contracts” of theCableuropa Annual Report on Form 20-F, as filed with the SEC on April 27,2005.

 

**ExchangeControls**

 

There are no foreign exchange controls currently in force that restrictthe import or export of capital or that affect the remittance of interest orother payments to holders of Notes who are non-residents of the United Kingdom.

 

There are no limitations relating to non-residents of the UnitedKingdom on the right to be a holder of, or to vote in respect of the Notesunder English law currently in force or in the Company’s memorandum or articlesof association.

 

**Taxation**

 

The summaries set out below describe certain material U.S. taxconsequences of the acquisition, ownership and disposition of the Notes andequity value certificates by a U.S. holder, as defined below, and certainmaterial U.K. tax consequences of the acquisition, ownership and disposition ofthe Notes. The statements regarding U.S. and U.K. tax laws and practices setforth below, including the statements regarding the U.S./U.K. double taxationconvention relating to income and capital gains assume that the Notes andequity value certificates will be issued, and transfers thereof will be made,in accordance with the applicable indenture, the applicable note depositaryagreement and the applicable equity value certificate agreement.

 

For purposes of the U.S. Internal Revenue Code of 1986, as amended tothe date hereof, which we refer to as the Code, U.S. holders of book-entryinterests will be treated as owners of the Notes underlying such book-entryinterests and, except as noted below, the tax consequences of owning book-entryinterests will be the same as those applicable to ownership of Notes. Howeverfor U.K. tax purposes the tax consequences of owning book-entry interests willnot in all cases be the same as those applicable to ownership of the Notes andit should not be assumed that the U.K. tax consequences of ownership of theNotes set out below will apply equally to ownership of book-entry interests.

 

**EUSavings Directive**

 

On June 3, 2003, the EU Council of Economic and Finance Ministersadopted a new directive regarding the taxation of savings income. The directiveis scheduled to be applied by Member States from July 1, 2005, providedthat certain non-EU countries adopt similar measures from the same date. Underthe directive each Member State will be required to provide to the taxauthorities of another Member State details of payments of interest or othersimilar income paid by a person within its jurisdiction to, or collected bysuch a person for, an individual resident in that other Member State; however,Austria, Belgium and Luxembourg may instead apply a withholding system for atransitional period in relation to such payments, deducting tax at rates risingover time to 35%. The transitional period is to commence on the date from whichthe directive is to be applied by Member States and to terminate at the end ofthe first full fiscal year following agreement by certain non-EU countries tothe exchange of information relating to such payments.

 

**UnitedKingdom Taxation**

 

The following is a summary of the current law and published practice inthe U.K. relating to certain aspects of the U.K. taxation of the acquisition,ownership and disposal of the Notes as of the date hereof and does not purportto be comprehensive. It relates only to the position of the persons who are theabsolute beneficial owners of their Notes and may not apply to specialsituations, such as those of dealers in securities. This summary does not dealwith the position of individuals who hold the Notes. Furthermore, thediscussion below is based upon the provisions of the U.K. tax laws and HerMajesty’s Revenue and Customs published practice as of the date hereof, andsuch provisions may be repealed, revoked or modified (possibly withretrospective effect) so as to result in U.K. tax consequences different fromthose discussed below. The following is a general guide and does not purport tobe a complete analysis or listing of all the potential U.K. tax consequences ofacquiring, owning or disposing of the Notes. It should therefore be treatedwith appropriate caution. Persons considering the purchase, ownership ordisposition of Notes should consult their tax advisers concerning U.K. taxconsequences in the light of their particular situations as well as any

 

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consequencesarising under the law of any other relevant tax jurisdiction. Norepresentations with respect to the tax consequences to any particular holderof Notes are made hereby.

 

***Withholding Tax on Interest on the Notes***

 

The Notes are “quoted Eurobonds” provided they are and continue to belisted on a “recognized stock exchange” within the meaning of section 841of the Income and Corporation Taxes Act 1988 (the Luxembourg Stock Exchange iscurrently so recognized). Accordingly, if the Notes are and continue to bequoted Eurobonds, payments of interest on the Notes may be made withoutwithholding or deduction for or on account of U.K. income tax.

 

In other cases, an amount on account of U.K. income tax at the lowerrate (currently 20%) may be withheld from interest payments, subject to suchrelief as may be available under the provisions of any applicable doubletaxation treaty.

 

***Withholding Tax on Payments by the Guarantors***

 

If any of the guarantors makes any payments in respect of interest onthe Notes (or other amounts due under such Notes other than the repayment ofamounts subscribed for the Notes) such payments may be subject to U.K.withholding tax at the basic rate (currently 22%) subject to such relief as maybe available under the provisions of any applicable double taxation treaty orto any other exemption which may apply. Such payments by the guarantors may notbe eligible for the “quoted Eurobond” exemption described above.

 

***Provision of Information***

 

Noteholders should note that where any interest on Notes is paid tothem (or to any person acting on their behalf) by the Issuer, or any person inthe U.K. acting on behalf of the Issuer (a “paying agent”), or is received byany person in the U.K. acting on behalf of the relevant Noteholder (other thansolely by clearing or arranging the clearing of a cheque) (a “collecting agent”),the Issuer, the paying agent or the collecting agent (as the case may be) may,in certain cases, be required to supply to Her Majesty’s Revenue and Customsdetails of the payment and certain details relating to the Noteholder(including the Noteholder’s name and address). These provisions will applywhether or not the interest has been paid subject to withholding or deductionfor or on account of U.K. income tax and whether or not the Noteholder isresident in the U.K. for U.K. taxation purposes. Where the Noteholder is not soresident, the details provided to Her Majesty’s Revenue and Customs may, incertain cases, be passed by Her Majesty’s Revenue and Customs to the taxauthorities of the jurisdiction in which the Noteholder is resident fortaxation purposes. For the above purposes, “interest” should be taken, forpractical purposes, as including payments made by a guarantor in respect ofinterest on the Notes. With effects from April 6, 2006, these provisionsmay also apply, in certain circumstances, to payments made on redemption of anyNotes where the amount payable on redemption is greater than the issue price ofthe Notes.

 

***Other Rules Relating to U.K. WithholdingTax on the Notes***

 

Any discount element on any such Notes issued at an issue price of lessthan 100% of their principal amount will not be subject to any U.K. withholdingtax pursuant to the provisions mentioned above, but may be subject to reportingrequirements as outlined above.

 

Where Notes are to be, or may fall to be, redeemed at a premium, asopposed to being issued at a discount, then any such element of premium mayconstitute a payment of interest. Payments of interest are subject to U.K.withholding tax and reporting requirements as outlined above.

 

Where interest has been paid under deduction of U.K. income tax,Noteholders who are not resident in the U.K. may be able to recover all or partof the tax deducted if there is an appropriate provision in any applicabledouble taxation treaty.

 

The above description of the U.K. withholding tax position assumes thatthere will be no substitution of the Issuer and does not consider the taxconsequences of any such substitution.

 

The references to “interest” above mean “interest” as understood inU.K. tax law. The statements above do not take any account of any differentdefinitions of “interest” or “principal” which may prevail under any other lawor which may be created by the terms and conditions of the Notes or any relateddocumentation.

 

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***Taxation by Direct Assessment of Noteholders***

 

Notwithstanding that interest may be received subject to deduction ofincome tax, Noteholders who are resident in the U.K. for tax purposes orholders who are non-resident and carrying on a trade, profession or vocation inthe U.K. through a branch, agency or permanent establishment, may be liable topay further U.K. tax on the interest received.

 

Where the interest is paid without withholding or deduction, theinterest will not be assessed to U.K. tax in the hands of holders of the Noteswho are not resident for U.K. tax purposes in the U.K., except where suchpersons are carrying on a trade, profession or vocation in the U.K. through abranch, agency or permanent establishment in connection with which the interestis received or to which the Notes are attributable. In such a case (subject toexemptions for interest received by certain categories of agent) tax may belevied on the U.K. branch, agency or permanent establishment.

 

***Ownership and Disposal (including Redemption)of the Notes by U.K. Corporation Tax Payers***

 

Holders which are companies within the charge of the UK corporation tax(by reason of being resident in the United Kingdom or carrying on a trade inthe United Kingdom through permanent establishment to which the Notes are attributable)will normally be taxed on the profit and gains arising from the Notes whetherincome or capital in nature (including if appropriate, with respect to foreignexchange gains or losses) as income. The amount of such profits or gains shouldbe calculated by reference to accounting-based concepts.  Relief may be available for certain chargesand expenses incurred for the purposes of the loan relationship constituted bythe Notes in accordance with such an applicable basis of accounting.

 

***Stamp Duty and Stamp Duty Reserve Tax (“SDRT”)on the Notes***

 

No U.K. stamp duty or SDRT is payable on the issue or transfer of theNotes. No U.K. stamp duty or SDRT is payable on any agreement for transfer of aNote provided that the Notes do not at any time carry (i) a right tointerest the amount of which exceeds a reasonable commercial return on thenominal amount of the capital or (ii) a right on repayment to an amountwhich exceeds the nominal amount of the capital and is not reasonablycomparable with what is generally repayable (in respect of a similar nominalamount of capital) under the terms of issue of certain specified listed loancapital.

 

**UnitedStates Taxation**

 

The following summary contains a description of the material U.S.federal income tax consequences of the ownership and disposition of the Notesat a price equal to their issue price (the first price at which a substantialpart of the Notes are offered to the public for cash, excluding sales to bondhouses, brokers or similar persons or organizations acting in the capacity ofunderwriters, placement agents or wholesalers). This summary is not acomprehensive description of all of the tax considerations for noteholders. Inparticular, this summary of U.S. federal income tax matters deals only with holdersthat hold the Notes as capital assets for U.S. federal income tax purposes(generally, assets held for investment) and does not address special taxsituations, such as the U.S. federal income tax treatment of holders that are (i) subjectto special tax rules (e.g., financial institutions, banks, securities orcurrency dealers, brokers, insurance companies, regulated investment companies,tax-exempt organizations, securities traders that elect mark-to-market taxaccounting, certain U.S. expatriates and persons subject to alternative minimumtax), (ii) holding Notes as part of a “straddle,” “hedge,” “conversiontransaction” or other integrated transaction or (iii) “U.S. Holders” (asdefined below) with a currency other than the U.S. dollar as their functionalcurrency.

 

This summary is based upon the Code, the Treasury regulations issuedthereunder and official interpretations thereof, each as in effect on the datehereof, all of which are subject to change or differing interpretations,possibly with retroactive effect. Current holders of the Notes should consulttheir own tax advisers as to the U.S. federal income tax consequences of theownership and disposition of the Notes, as well as the effect of any state orlocal tax laws or tax laws of any jurisdiction other than the United States.

 

As used herein, a “U.S. Holder” means a beneficial owner of a note thatis, for U.S. federal income tax purposes, (i) a citizen or individualresident of the United States or of any state (including District of Columbia),(ii) a corporation or other entity taxable as a corporation created ororganized in or under the laws of the United States or of any State, (iii) anestate the income of which is subject U.S. federal income taxation regardlessof its source and (iv) a trust if a court within the United States is ableto exercise primary supervision over the administration of the trust, and oneor more U.S. persons (as defined in the Code) have the

 

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authority tocontrol all substantial decisions of the trust, or if the trust has made avalid election under Treasury regulations to be treated as a U.S. person. A “Non-U.S.Holder” means a beneficial owner of a Note that is not a U.S. Holder. If anentity treated as a partnership for U.S. federal income tax purposes holdsNotes, the tax treatment of a partner generally will depend upon the status ofthe partner and the activities of the partnership. Holders that are partnershipshould consult their own tax advisers regarding the specific tax consequencesto their partners of the ownership and disposition of the Notes.

 

***Tax Treatment of the Notes***

 

*Classification of the Notes.* This summary is based upon the assumption that the Notes arecharacterized as indebtedness for U.S. federal income tax purposes. Currentholders of the Notes should recognize, however, that there is some uncertaintyregarding the appropriate characterization of instruments such as the Notes,and no rulings have been or will be sought from the IRS with respect to theappropriate characterization of the Notes for U.S. federal income tax purposes.It is possible that the IRS might contend that the Notes should be treated notas indebtedness but as equity in the Issuer. Any such recharacterization mightresult in material adverse consequences to U.S. Holders of the Notes, includingpossible application of the passive foreign investment company (“PFIC”), rules.In the event that Notes are recharacterized as equity, a U.S. Holder would berequired to pay an interest charge together with tax calculated at maximumordinary income rates on gain realized on the disposition of a Note or oncertain increased interest payments with respect to a Note. Current holders ofthe Notes should consult their own tax advisers about the consequences in theevent that the Notes are treated as equity for U.S. federal income taxpurposes.

 

*Stated Interest.* Stated interest on the Notes will be includible in a U.S. holder’s grossincome as ordinary interest income in accordance with such U.S. Holder’s usualmethod (cash or accrual) of tax accounting.

 

In the case of stated interest received on a euro Note, the amount ofincome recognized by a cash basis U.S. Holder will be the U.S. dollar value ofthe stated interest payment, based on the “spot rate” in effect on the date ofreceipt. Spot rate generally means a rate that reflects a fair market rate ofexchange available to the public for euro under a “spot contract” in a freemarket and involving representative amounts. A spot contract is a contract tobuy and sell a euro on or before two business days following the date ofexecution of the contract. If such spot rate cannot be demonstrated, the IRShas authority to determine the spot rate.

 

The amount of stated interest recognized by an accrual basis U.S.Holder of a euro Note will be determined for any accrual period in euro andthen translated into U.S. dollars using the average U.S. dollar-euro exchangerate for the accrual period (or, with respect to an accrual period that spanstwo taxable years, using the average exchange rate for the partial periodwithin each taxable year). The average rate for an accrual period (or partialperiod) is the simple average of the spot rates for each business day of suchperiod, or other average exchange rate for the period reasonably derived andconsistently applied by the holder. Alternatively, an accrual basis U.S. Holdercan elect to translate stated interest at the spot rate on the last day of theaccrual period (and, in the case of a partial accrual period, the sport rate onthe last day of the taxable year) or on the date the interest payment isreceived if such date is within five business days of the end of the accrualperiod. A U.S. Holder that makes such an election must apply it consistently toall debt instruments from year to year and cannot change the election withoutthe consent of the IRS.

 

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*Original Issue Discount.* The 2010 Notes were not issued with any original issue discount (“OID”).

 

As described above, each of the 2011 Notes will be treated as havingbeen issued with OID in an amount equal to the excess of (a) the “statedredemption price at maturity” of the note over (b) its “issue price”. U.S.Holders should be aware that they generally must include OID in gross income inadvance of the receipt of cash attributable to that income. Under these rules,a U.S. Holder will have to include in income increasingly greater amounts ofOID in successive accrual periods.

 

The “stated redemption price at maturity” of a Note will equal the sumof all cash payments required to be made on such note other than payments of “qualifiedstated interest”. The term “qualified stated interest” means stated interestthat is unconditionally payable in cash or in property (other than debtinstruments of the Issuer) at least annually at a single fixed rate or, subjectto certain conditions, based on one or more interest indices. The statedinterest payments on the Notes are qualified stated interest. Accordingly, eachNote will bear OID in an amount equal to the excess of its principal amountover its issue price.

 

The amount of OID includible in income by a U.S. Holder of a Note isthe sum of the “daily portions” for each day of the taxable year during whichthe U.S. Holder holds the Note. The daily portions of OID required to beincluded in a U.S. Holder’s gross income in a taxable year are determined undera constant yield method by allocating to each day during the taxable year onwhich the U.S. Holder holds the Note a pro rata portion of the OID on suchNote that is attributable to the “accrual period” in which such day isincluded. The amount of the OID attributable to each accrual period is anamount equal to the excess, if any, of (a) the product of the Note’s “adjustedissue price” at the beginning of such accrual period (defined below), and its “yieldto maturity” (the discount rate which, when used in computing the present valueof all principal and interest payments to be made under the Note, produces anamount equal to the Note’s issue price) over (b) the sum of any qualifiedstated interest allocable to the accrual period. OID allocable to a finalaccrual period is the difference between the amount payable at maturity and theadjusted issue price at the beginning of the final accrual period.

 

The “adjusted issue price” of the Note at the beginning of the firstaccrual period will be its issue price. Thereafter, the adjusted issue price atthe beginning of any other accrual period will be (a) the sum of the Note’sissue price and the aggregate amount of OID that accrued for all prior accrualperiods, less (b) any payments made on the Note (other than qualifiedstated interest), if any, on or before the first day of the accrual period.

 

*Sale and Redemption of Notes*. A U.S. Holder generally willrecognize gain or loss upon the sale, exchange, retirement or other dispositionof a Note in an amount equal to the difference between the U.S. dollar value ofthe amount realized upon such sale, exchange, retirement or other disposition(other than amounts attributable to accrued interest, which will be taxable asordinary interest income, as described above), and such U.S. Holder’s adjustedtax basis in the Note. For this purpose, an amount received in euro will betranslated into U.S. dollars at the spot rate in effect on the date ofdisposition of the Notes. If the Notes are traded on an established securitiesmarket, a cash basis Holder (and, if it elects, an accrual basis Holder) willdetermine the U.S. dollar equivalent of the amount realized on the sale of aNote by translating that amount at the spot rate in effect on the settlementdate. A U.S. Holder’s adjusted tax basis in a Note will generally equal theissue price of such Note (in the case of a euro Note, translated into U.S.dollars using the spot rate in effect on the date of a Holder’s purchase of aNote or unit or the settlement date, if the Notes are traded on an establishedsecurities market as discussed above) increased by the amount of any OIDincluded in income (in the case of a euro Note, translated into U.S. dollars).Any gain or loss (other than foreign currency gain or loss in the case of aeuro Note, described below) will be capital gain or loss and generally will belong-term capital gain or loss if the Note is held for more than one year.Under current law, net long-term capital gains of a noncorporate U.S. Holderare, under certain circumstances, taxed at lower U.S. federal income tax ratesthan are items of ordinary income. The deductibility of capital losses by aU.S. Holder, however, is subject to significant limitations.

 

*Taxation of Additional Amounts.* If additional amounts are required to be paid in respect of withholdingor deduction for taxes imposed on payments on the Notes, such additionalamounts should be taxable to a U.S. Holder as ordinary income at the time suchamounts are accrued or received, in accordance with such U.S. Holder’s regularmethod of accounting. In such event, the amount taxable to such U.S. Holderwould include all taxes withheld or deducted in respect of the Notes. Thus, aU.S. Holder would be required to report income in an amount greater than thecash it receives in respect of payments on the Notes. However, a U.S. Holdermay, subject to certain limitations, be eligible to claim as a credit ordeduction the foreign taxes withheld or deducted for purposes of computing itsU.S. federal income tax liability.

 

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It is possible, however, that the IRS might require each U.S. Holder toinclude additional amounts in gross income as such amounts accrue over the lifeof the Notes (in advance of the payment of such additional amounts). In suchcase, it is unclear whether a U.S. Holder would be entitled to claim a creditor deduction for the foreign taxes giving rise to the additional amounts untilthe taxes are actually deducted or withheld. If a U.S. Holder is required toaccrue additional amounts and not allowed a credit or deduction for the foreigntaxes giving rise to the amounts until the taxes are paid, the U.S. Holder mayhave insufficient foreign source income in the year in which the foreign taxesare actually deducted or withheld to enable it to claim a foreign tax creditwith respect to the foreign taxes.

 

*Foreign Currency Gain or Loss.* U.S. Holders of the euro Notes will realize foreign currency gain orloss, which generally will be treated as ordinary income or loss, as the casemay be, upon the receipt of payments on the euro Notes and upon the sale,exchange, retirement or other disposition of the euro Notes, and the realizedforeign currency gain or loss generally will be recognized in accordance withapplicable provisions of the Code. For this purpose, payments on a euro Note orproceeds of a disposition of a euro Note will be characterized first aspayments of interest and then as payments of principal, and paymentscharacterized as interest will be attributed first to the earliest accrualperiod in which interest has accrued and to which prior payments have not beenattributed. Generally, the amount of foreign currency gain or loss realizedwith respect to payments of interest will be equal to the difference between(x) the euro amount received as translated into U.S. dollars using thespot rate on the date of receipt, and (y) the U.S. dollar amountpreviously included in income in respect of the payment. The amount of foreigncurrency gain or loss realized with respect to payments of principal will beequal to the difference between (x) the euro amount of principal receivedas translated into U.S. dollars using the spot rate on the date of receipt, and(y) the euro amount of principal translated into U.S. dollars using thespot rate on the date the euro note was acquired. However, the amount of anyforeign currency gain or loss realized upon a sale, exchange, retirement ordisposition of a euro Note with respect to interest, and principal shall belimited to the total amount of gain or loss, as the case may be, realized onthe transaction.

 

***Foreign Tax Credit***

 

For U.S. foreign tax credit purposes, OID, stated interest, and anyadditional amounts or special interest with respect to a Note will be treatedas foreign-source income while gain or loss realized on the sale, exchange,retirement or other disposition of a Note (including foreign currency gain orloss) generally will be treated as U.S.-source income or loss.

 

Subject to certain limitations, a US. Holder will generally be entitledto a credit against its U.S. federal income tax liability, or a deduction incomputing its U.S. federal taxable income, for United Kingdom income taxeswithheld by the Issuer. For purposes of the foreign tax credit limitation,foreign source income until December 31, 2006, is classified in one ofseveral “baskets,” and the credit for foreign taxes en income in any basket islimited to U.S. federal income tax allocable to that income. Interest en theNotes generally will constitute foreign source income in the “high withholdingtax interest” basket if the Notes are subject to United Kingdom withholding taxat a rate of 5 per cent. or higher. If the Notes are not subject to such awithholding tax, interest generally will be in the “passive income” basket.Recently enacted legislation effective after December 31,2006, will limitthe foreign tax credit limitation categories to “passive category income” and “generalcategory income.” Prospective purchasers should consult their tax advisersconcerning the foreign tax credit implications of the payment of any UnitedKingdom taxes.

 

***Non-U.S. Holders***

 

Subject to the discussion of “backup” withholding below, a Non-U.S.Holder is currently exempt from U.S. federal income taxes with respect tointerest and OID on the Notes unless the Non-U.S. Holder is, among otherthings, an individual or corporation that has an office or other fixed place ofbusiness in the United States to which the interest and OID is attributable andthe interest and OID are derived in the active conduct of a banking, financingor similar business within the United States or is received by a corporationthe principal business of which is trading in stock or securities for its ownaccount. In addition, subject to the discussion of backup withholding below, aNon-U.S. Holder will not be subject to U.S. federal income tax on any gain on asale or other disposition of a Note unless (a) the holder is an individualwho is present in the United States for 183 days or more during thetaxable year and certain other conditions are met or (b) the gain iseffectively connected with the conduct of a trade or business within the UnitedStates (and, if a treaty applies, the gain is generally attributable to a U.S.permanent establishment maintained by such Non-U.S. Holder).

 

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***TaxReturn Disclosure and Investor List Requirements***

 

Treasury regulations (the “TaxShelter Regulations”) intended to address so called tax shelters and otherpotentially tax-motivated transactions require participants in a “reportabletransaction” to disclose certain information about the transaction on IRS Form 8886and retain information relation to the transaction. Organizers and sellers ofreportable transaction are required to maintain lists identifying the investorsparticipating in the transactions and furnish to the IRS upon demand suchinvestor information as well as detailed information regarding thetransactions. A transaction may be a “reportable transaction” based upon any ofseveral indicia (including the existence of confidentiality agreements, certainindemnity arrangements, potential for recognizing investment or other losses,significant book-tax differences, a brief asset holding period, and whether thetransaction is a listed transaction). In addition, the Tax Shelter Regulationscould be interpreted to cover and require reporting of transactions that aregenerally not considered tax shelters, including certain foreign currencytransactions. Significant penalties are imposed for failure to comply withthese disclosure requirements. Current holders of the Notes should consulttheir tax advisers concerning any possible disclosure obligation with respectto their investment and should be aware that the Issuer and other participantsin the transaction intend to comply with the disclosure and list maintenancerequirements under the Tax Shelter Regulations as applicable with respect tothis transaction.

 

***InformationReporting and Backup Withholding***

 

In general, informationreporting requirements will apply to certain payments within the United Statesof stated interest, OID, special interest and additional amounts on the Notes,including payments made by the U. S. office of a paying agent, broker or otherintermediary, and to proceeds of a sale, redemption or other disposition of theNotes through a U. S. branch of a U. S. or foreign broker. A backup withholdingtax may apply to such payments or proceeds if the beneficial owner fails toprovide a correct taxpayer identification number (generally on IRS Form W-9)or, in the case of payments of stated interest, OID, special interest oradditional amounts, fails to certify that he is not subject to such withholdingor fails to report interest and dividend income in full. Payments of principalor proceeds from the disposition of Notes by or through a foreign office of aU.S. or foreign broker with certain relationships with the United Statesgenerally will be subject to information reporting but not backup withholding.Non-U.S. Holders generally will not be subject to information reporting orbackup withholding. However, these Holders may be required to providecertification of non-U.S. status (generally on IRS Form W-8BEN) inconnection with payments received in the United States or through certain U.S.-relatedfinancial intermediaries. Any amounts withheld under the backup withholding rules froma payment to a beneficial owner will be allowed as a refund or credit againstsuch beneficial owner’s U.S. federal income tax liability provided the requiredinformation is furnished to the IRS in a timely manner.

 

**Documents onDisplay**

 

We file reports, including thisannual report on Form 20-F, and other information with the Securities andExchange Commission, or SEC. We are allowed to “incorporate by reference” theinformation we file with the SEC. This permits us to disclose importantinformation by referring to these documents.

 

These reports and otherinformation can also be inspected without charge and copied at prescribed ratesat the public reference facilities maintained by the Securities and ExchangeCommission in Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549,and at the regional office of the Securities and Exchange Commission located atthe Northwest Atrium Center, 500 West Madison Street, Suite 1400, Chicago,Illinois 60661-2511. Copies of this material are also available by mail fromthe Public Reference section of the Securities and Exchange Commission, at450 Fifth Street, N.W., Washington, D.C. 20549.

 

**Item 11.Quantitative and Qualitative Disclosure about Market Risk**

 

We rely entirely on payments bythe ONO Group under the multi-borrower credit facilities and the notes proceedsloans to provide the funds necessary for us to pay principal and interest onthe Notes. Our market risk exposure (including exposure relating to currencyexchange risks and interest rate risks) therefore corresponds to the marketrisk exposure of the ONO Group. For a discussion of the market risks thataffect the ONO Group, please see Item 11 “Quantitative and QualitativeDisclosure about Market Risk” of the Cableuropa Annual Report on Form 20-F,as filed with the SEC on April 27, 2005.

 

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**Item 12.Description of Securities Other than Equity Securities**

 

Not applicable.

 

**PART II**

 

**Item 13.Defaults, Dividend Arrearages and Delinquencies**

 

Not applicable.

 

**Item 14.Material Modifications to the Rights of Security Holders and Use of Proceeds**

 

Not applicable.

 

**Item 15.Controls and Procedures**

 

Our disclosure controls andprocedures are designed to provide reasonable assurance that informationrequired to be disclosed in this report is recorded, processed, summarized andreported on a timely basis. Our board of directors performed an evaluation ofour disclosure controls and procedures as of December 31, 2004. Based onthat evaluation, they concluded that our disclosure controls and procedureswere effective as of December 31, 2004, to achieve their intendedobjectives. There have not been any changes in our internal control overfinancial reporting during fiscal year 2004 that have materially affected, orare reasonably likely to materially affect, our internal control over financialreporting.

 

**PART III**

 

**Item 16. [Reserved]**

 

**Item 16A. AuditCommittee Financial Expert**

 

Not applicable.

 

**Item 16B. Codeof Ethics**

 

We have not adopted a code ofethics as defined for purposes of Section 406 of the Sarbanes-Oxley Act of2002 because we are not required to have such a code of ethics under Englishlaw.

 

**Item 16C.Principal Accountant Fees and Services**

 

ONO Finance (Holdings) Limited,our corporate parent, pays all of our administrative expenses, includingaccounting fees.

 

**Item 16D.Exemptions from the Listing Standards for Audit Committee**

 

Not applicable.

 

**Item 16E.Purchases of Equity Securities by Issuer**

 

Not applicable

 

**Item 17. Financial Statements**

 

Not applicable.

 

**Item 18. Financial Statements**

 

See our audited consolidatedfinancial statement, and the notes thereto, beginning at page F-1.

 

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**Item 19. Exhibits**

 
| **Exhibits** |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|--------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ** **   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| 1.1          |   | Memorandum and Articles of  Association of ONO Finance PLC (formerly known as Ballardway Plc)  (incorporated by reference to exhibit 3.1 of registrants’ Registration  Statement submitted October 5, 1999 on Form F-4 (file  No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 1.2          |   | Articles of Association of ONO  Finance PLC (incorporated by reference to exhibit 3.14 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File  No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| 2.1          |   | Indenture, dated as of  June 30, 2000 between ONO Finance PLC, Cableuropa S.A., Albacete  Sistemas de Cable, S.A., Cable y Televisión de Andalucía, S.A., Cable y  Televisión de El Puerto, S.A., Cádiz de Cable y Televisión, S.A., Corporación  Mallorquina de Cable, S.A., Huelva de Cable y Televisión, S.A., Mediterránea  Norte Sistemas de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Región de Murcia de Cable, S.A., Valencia de Cable, S.A., Santander de Cable,  S.A., Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atencion al  Cliente, S.A. and The Bank of New York in respect of ONO Finance PLC’s  €200,000,000 14% Notes due 2010 (incorporated by reference to exhibit 4.1 of  registrants’ Registration Statement submitted November 29, 2000 on form  F-4 (File No. 333-12932)).                     |
| 2.2          |   | Registration Rights Agreement  dated June 30, 2000, by and between the Initial Purchasers, as defined  therein, ONO Finance PLC, Cableuropa S.A., and the Note Guarantors, as used  therein (incorporated by reference to exhibit 10.24 of registrants’  Registration Statement submitted November 29, 2000 on form F-4 (File No. 333-12932)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| 2.3          |   | Dollar Note Indenture, dated  as of May 6, 1999, between ONO Finance PLC and Bankers Trust Company in  respect of ONO Finance PLC’s $275,000,000 13% Notes due 2009 (incorporated by  reference to exhibit 4.1 of registrants’ Registration Statement submitted  October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 2.4          |   | Supplemental Dollar Note  Indenture, dated as of September 28, 1999, between ONO Finance PLC,  Santander de Cable, S.A. and Bankers Trust Company in respect of ONO Finance  PLC’s $275,000,000 13% Notes due 2009 (incorporated by reference to exhibit  4.2 of registrants’ Registration Statement submitted October 5, 1999 on  form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| 2.5          |   | Euro Note Indenture, dated as  of May 6, 1999, between ONO Finance PLC and Bankers Trust Company in  respect of ONO Finance PLC’s 125,000,000 13% Notes due 2009 (incorporated by  reference to exhibit 4.3 of registrants’ Registration Statement submitted  October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 2.6          |   | Supplemental Euro Note  Indenture dated as of September 28, 1999, between ONO Finance PLC,  Santander de Cable, S.A. and Bankers Trust Company in respect of ONO Finance  PLC’s €125,000,000 13% Notes due 2009 (incorporated by reference to exhibit  4.4 of registrants’ Registration Statement submitted October 5, 1999 on  form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 2.7          |   | Registration Rights Agreement  dated May 6, 1999, by and between the Initial Purchasers, as defined in  the Purchase Agreement, ONO Finance PLC, Cableuropa S.A., and the Controlled  Companies, as defined therein (incorporated by reference to exhibit 10.28 of  registrants’ Registration Statement submitted October 5, 1999 on form  F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 2.8          |   | Purchase Agreement, dated as  of February 2, 2001 by and between the Initial Purchasers, as defined  therein, ONO Finance PLC, Cableuropa, S.A., Albacete Sistemas de Cable, S.A.,  Cable y Televisión de Andalucía, S.A., Cable y Televisión de El Puerto, S.A.,  Cádiz de Cable y Televisión, S.A., Corporación Mallorquina de Cable, S.A.,  Huelva de Cable y Televisión, S.A., Mediterránea Norte Sistemas de Cable,  S.A., Mediterránea Sur Sistemas de Cable, S.A., Región, de Murcia de Cable, S.A.,  Valencia de Cable, S.A., Santander de Cable, S.A., TDC Sanlúcar, S.A.,  Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atencion al  Cliente, S.A. (incorporated by reference to exhibit 1.1 of registrants’  Registration Statement submitted May 17, 2001 on form F-4 (File  No. 333-13536)).                                   |
| 2.9          |   | Indenture, dated as of  February 9, 2001 between ONO Finance PLC, Cableuropa S.A., Albacete  Sistemas de Cable, S.A., Cable y Televisión de Andalucía, S.A., Cable y  Televisión de El Puerto, S.A., Cádiz de Cable y Televisión, S.A., Corporación  Mallorquina de Cable, S.A., Huelva de Cable y Televisión, S.A., Mediterránea  Norte Sistemas de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Región, de Murcia de Cable, S.A., Valencia de Cable, S.A., Santander de Cable,  S.A., Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atencion al  Cliente, S.A., TDC Sanlúcar, S.A., and The Bank of New York in respect of ONO  Finance PLC’s $200,000,000 14% Notes due 2011 (incorporated by reference to  exhibit 4.1 of registrant’s Registration Statement submitted May 17,  2001 on form F-4 (File No. 333-13530)). |

 

23

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| 2.10 |   | Indenture, dated as of  February 9, 2001 between ONO Finance PLC, Cableuropa S.A., Albacete  Sistemas de Cable, S.A., Cable y Televisión de Andalucía, S.A., Cable y  Televisión de El Puerto, S.A., Cádiz de Cable y Televisión, S.A., Corporación  Mallorquina de Cable, S.A., Huelva de Cable y Televisión, S.A., Mediterránea  Norte Sistemas de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Región, de Murcia de Cable, S.A., Valencia de Cable, S.A., Santander de  Cable, S.A., Univertel Comunicaçôes Universais, S.A., Hydra Servicios de  Atencion al Cliente, S.A., TDC Sanlúcar, S.A., and The Bank of New York in  respect of ONO Finance PLC’s $150,000,000 14% Notes due 2011 (incorporated by  reference to exhibit 4.2 of registrant’s Registration Statement submitted  May 17, 2001 on form F-4 (File No. 333-13530)). |
|------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2.11 |   | Registration Rights Agreement  dated February 9, 2001, by and between the Initial Purchasers, as  defined therein, ONO Finance PLC, Cableuropa S.A., and the Note Guarantors,  as used therein (incorporated by reference to exhibit 10.24 of registrant’s  Registration Statement submitted May 17, 2001 on form F-4 (File  No. 333-13530)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 3.1  |   | Vote Pooling Agreement, dated  January 22, 1998, by and between parties representing Cableuropa, S.A.,  and Spanish Telecommunications Limited S.á.r.l (incorporated by reference to  exhibit 10.12 of registrants’ Registration Statement submitted  October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 4.1  |   | Shareholders’ Agreement of  Cableuropa, dated November 3, 2000, by and between Ferrovial  Telecomunicaciones S.A., Grupo Multitel, S.A., Cántabra de Inversiones, S.A.,  Spanish Telecommunications Limited, S.à.r.l, Santander  Telecommunications, Inc., Global Telecom Investments, LLC, BAEP  Telecommunications Investments, LLC, Particel International Limited  Partnership and VAL Telecommunications, S.L. (incorporated by reference to  exhibit 10.1 of registrants’ Registration Statement submitted  November 29, 2000 on form F-4 (File No. 333-12932)).                                                                                                                                                                                                                                                                                                                                  |
| 4.2  |   | Euro Multi-Borrower Credit  Facility, dated June 30, 2000, between Cableuropa, S.A., Valencia de  Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Región de Murcia de Cable, S.A., Huelva de Cable y  Televisión, S.A., Cádiz de Cable y Televisión, S.A., Cable y Televisión de El  Puerto, Cable y Televisión de Andalucia, S.A., Corporación Mallorquina de  Cable, S.A., and Albacete Sistemas de Cable, S.A., as Borrowers, and ONO  Finance PLC, as lender (incorporated by reference to exhibit 10.26 of  registrants’ Registration Statement submitted November 29, 2000 on form  F-4 (File No. 333-12932)).                                                                                                                                                                                                       |
| 4.3  |   | Novation Agreement, dated  February 13, 2003, to Modify, without Termination, a Euro Multi-Borrower  Credit Facility dated June 30, 2000, between Cableuropa S.A.U., Valencia  de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Región de Murcia de Cable, S.A., Univertel  Comunicaçôes Universais, S.A., Hydra Servicios de Atención al Cliente, S.A.,  as Borrowers and ONO Finance PLC, as lender (incorporated by reference to  exhibit 4.3 of registrant’s annual report submitted May 29, 2003 on  Form 20-F (File No. 333-10976)).                                                                                                                                                                                                                                                                                    |
| 4.4  |   | Escrow and Disbursement  Agreement, dated June 30, 2000, by and among The Bank of New York, ONO  Finance PLC, Cableuropa, S.A. Valencia de Cable, S.A., Mediterránea Sur  Sistemas de Cable, S.A., Mediterránea Norte Sistemas de Cable, S.A., Región  de Murcia de Cable, S.A., Huelva de Cable y Televisión, S.A., Cádiz de Cable  y Televisión, S.A., Cable y Televisión de El Puerto, Cable y Televisión de  Andalucia, S.A., Corporación Mallorquina de Cable, S.A., Albacete Sistemas de  Cable, S.A., Hydra Servicios de Atencion al Cliente, S.A. and Univertel  Comunicaçôes, S.A. (incorporated by reference to exhibit 10.28 of  registrants’ Registration Statement submitted November 29, 2000 on form  F-4 (File No. 333-12932)).                                                                                                                      |
| 4.5  |   | Senior Bank Facility  Agreement, dated March 6, 2000, between Cableuropa, S.A., Bank of  America International limited, Barclays Capital, Citibank, N.A., Toronto  Dominion Bank Europe Limited, Albacete Sistemas de Cable S.A., Cádiz de Cable  y Televisión S.A., Región de Murcia de Cable S.A., Valencia de Cable S.A.,  Corporación Mallorquina de Cable S.A., Cable y Televisión de El Puerto S.A.,  Huelva de Cable y Televisión S.A., Mediterránea Sur Sistemas de Cable S.A.,  Mediterránea Norte Sistemas de Cable S.A., Cable y Televisión de Andalucía  S.A. and Hydra Servicios de Atencion al Cliente, S.A. (incorporated by  reference to exhibit 10.25 of registrants’ Registration Statement submitted  November 29, 2000 on form F-4 (File No. 333-12932)).                                                                                            |
| 4.6  |   | Purchase Agreement, dated as  of June 23, 2000 by and between the Initial Purchasers, as defined  therein, ONO Finance PLC, Cableuropa, S.A., Albacete Sistemas de Cable, S.A.,  Cable y Televisión de Andalucía, S.A., Cable y Televisión de El Puerto, S.A.,  Cádiz de Cable y Televisión, S.A., Corporación Mallorquina de Cable, S.A.,  Huelva de Cable y Televisión, S.A., Mediterránea Norte Sistemas de Cable,  S.A., Mediterránea Sur Sistemas de Cable, S.A., Región de Murcia de Cable,  S.A., Valencia de Cable, S.A., Santander de Cable, S.A., Univertel  Comunicaçôes Universais, S.A., Hydra Servicios de Atencion al Cliente, S.A.  (incorporated by reference to exhibit 1.1 of registrants’ Registration  Statement submitted November 29, 2000 on form F-4 (File  No. 333-12932)).                                                           |
| 4.7  |   | Note Depositary Agreement,  dated June 30, 2000, by and between ONO Finance PLC and The Bank of New  York Trust Company (Cayman) Limited (incorporated by reference to exhibit  10.27 of registrants’ Registration Statement submitted November 29, 2000  on form F-4 (File No. 333-12932)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 4.8  |   | Senior Facility Agreement,  dated June 14, 1999, between Cableuropa, S.A., Electro Banque S.A.,  Albacete Sistemas de                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |

 

24

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|   |   | Cable S.A., Cádiz de Cable y  Televisión S.A., Región de Murcia de Cable S.A., Valencia de Cable S.A.,  Corporación Mallorquina de Cable S.A., Cable y Televisión de El Puerto S.A.,  Huelva de Cable y Televisión S.A., Mediterránea Sur Sistemas de Cable S.A.,  Mediterránea Norte Sistemas de Cable S.A., and Cable y Televisión de  Andalucía S.A. (incorporated by reference to exhibit 10.29 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File  No. 333-10976)).                                                                                                                                                                                                                                                                                 |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.9    |   | Dollar Multi-Borrower Credit  Facility, dated May 6, 1999, between Cableuropa, S.A., Valencia de  Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Región de Murcia de Cable, S.A., Huelva de Cable y  Televisión, S.A., Cádiz de Cable y Televisión, S.A., Cable y Televisión de El  Puerto, Cable y Televisión de Andalucia, S.A., Corporación Mallorquina de  Cable, S.A., and Albacete Sistemas de Cable, S.A., as Borrowers, and ONO  Finance PLC, as Lender (incorporated by reference to exhibit 10.30 of  registrants’ Registration Statement submitted October 5, 1999 on form  F-4 (File No. 333-10976)).                                                                                                                    |
| 4.10   |   | Novation Agreement, dated  February 13, 2003, to Modify, without Termination, a Dollar  Multi-Borrower Credit Facility dated May 6, 1999, between Cableuropa  S.A.U., Valencia de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Mediterránea Norte Sistemas de Cable, S.A., Región de Murcia de Cable, S.A.,  Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atención al  Cliente, S.A., as Borrowers and ONO Finance PLC, as lender (incorporated by  reference to exhibit 4.10 of registrant’s annual report submitted  May 29, 2003 on Form 20-F (File No. 333-10976)).                                                                                                                                                                                         |
| 4.11   |   | Euro Multi-Borrower Credit  Facility, dated May 6, 1999, between Cableuropa, S.A., Valencia de Cable  S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte Sistemas  de Cable, S.A., Región de Murcia de Cable, S.A., Huelva de Cable y Televisión  de Andalucia, S.A., Corporación Mallorquina de Cable, S.A., and Albacete  Sistemas de Cable, S.A., as Borrowers, and ONO Finance PLC, as Lender  (incorporated by reference to exhibit 10.31 of registrants’ Registration  Statement submitted October 5, 1999 on form F-4 (File  No. 333-10976)).                                                                                                                                                                                                                                          |
| 4.12   |   | Novation Agreement, dated  February 13, 2003, to Modify, without Termination, a Euro Multi-Borrower  Credit Facility dated May 6, 1999, between Cableuropa S.A.U., Valencia  de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Región de Murcia de Cable, S.A., Univertel  Comunicaçôes Universais, S.A., Hydra Servicios de Atención al Cliente, S.A.,  as Borrowers and ONO Finance PLC, as lender (incorporated by reference to  exhibit 4.12 of registrant’s annual report submitted May 29, 2003  on Form 20-F (File No. 333-10976)).                                                                                                                                                                                           |
| 4.13   |   | Dollar Equity Value  Certificate Agreement, dated May 6, 1999, among ONO Finance PLC,  Cableuropa, S.A., and Bankers Trust Company, as Equity Value Certificate  Agent (incorporated by reference to exhibit 10.32 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File  No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| 4.14   |   | Euro Equity Value Certificate  Agreement, dated May 6, 1999, among ONO Finance PLC, Cableuropa, S.A.,  and Bankers Trust Company, as Equity Value Certificate Agent (incorporated by  reference to exhibit 10.33 of registrants’ Registration Statement submitted  October 5, 1999 on form F-4 (File No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| 4.15   |   | Dollar Escrow and Disbursement  Agreement, dated May 6, 1999, by and among Bankers Trust Company, ONO  Finance PLC, Cableuropa, S.A., Valencia de Cable, S.A., Mediterránea Sur  Sistemas de Cable, S.A., Mediterránea Norte Sistemas de Cable, S.A., Región  de Murcia de Cable, S.A., Huelva de Cable y Televisión, S.A., Cádiz de Cable  y Televisión, S.A., Cable y Televisión de El Puerto, Cable y Televisión de  Andalucia, S.A., Corporación Mallorquina de Cable, S.A., and Albacete  Sistemas de Cable, S.A. (incorporated by reference to exhibit 10.36 of  registrants’ Registration Statement submitted October 5, 1999 on form  F-4 (File No. 333-10976)).                                                                                                                  |
| 4.16   |   | Euro Escrow and Disbursement  Agreement, dated May 6, 1999, by and among Bankers Trust Company, ONO  Finance PLC, Cableuropa, S.A., Valencia de Cable, S.A., Mediterránea Sur  Sistemas de Cable, S.A., Mediterránea Norte Sistemas de Cable, S.A., Región  de Murcia de Cable, S.A., Huelva de Cable y Televisión, S.A., Cádiz de Cable  y Televisión, S.A., Cable y Televisión de El Puerto, Cable y Televisión,  S.A., Cádiz de Cable y Televisión, S.A., Cable y Televisión de El Puerto,  Cable y Televisión de Andalucia, S.A., Corporación Mallorquina de Cable,  S.A., and Albacete Sistemas de Cable, S.A. (incorporated by reference to  exhibit 10.37 of registrants’ Registration Statement submitted  October 5, 1999 on form F-4 (File No. 333-10976)). |
| 4.17   |   | Dollar Note Depositary  Agreement, dated May 6, 1999, by and between ONO Finance PLC and Bankers  Trust Company (incorporated by reference to exhibit 10.34 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File  No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| 4.18   |   | Euro Note Depositary  Agreement, dated May 6 1999, by and between ONO Finance PLC and Bankers  Trust Company (incorporated by reference to exhibit 10.35 of registrants’  Registration Statement submitted October 5, 1999 on form F-4 (File  No. 333-10976)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| 4.19   |   | Euro Multi-Borrower Credit  Facility, dated as of February 9, 2001 between Cableuropa S.A., Valencia  de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Región, de Murcia de Cable, S.A., Huelva de Cable y  Televisión, S.A., Cádiz de Cable y Televisión, S.A., Cable y Televisión de El  Puerto, Cable y                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

 

25

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|   |   | Televisión de Andalucia, S.A.,  Corporación Mallorquina de Cable, S.A., Albacete Sistemas de Cable, S.A.,  Santander de Cable, S.A., Univertel Comunicaçôes S.A., Hydra Servicios de  Atencion al Cliente, S.A., and TDC Sanlúcar, S.A., as Borrowers, and ONO  Finance PLC, as Lender, in respect of ONO Finance Plc’s $200,000,000 14%  Notes (incorporated by reference to exhibit 10.25 of registrant’s  Registration Statement submitted May 17, 2001 on form F-4 (File  No. 333-13530)).                                                                                                                                                                                                                                                                                                                                                                                                           |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.20   |   | Novation Agreement, dated  February 13, 2003, to Modify, without Termination, a Dollar  Multi-Borrower Credit Facility dated February 9, 2001, between  Cableuropa S.A.U., Valencia de Cable, S.A., Mediterránea Sur Sistemas de  Cable, S.A., Mediterránea Norte Sistemas de Cable, S.A., Región de Murcia de  Cable, S.A., Univertel Comunicaçôes Universais, S.A., Hydra Servicios de  Atención al Cliente, S.A., as Borrowers and ONO Finance PLC, as lender  (incorporated by reference to exhibit 4.20 of registrant’s annual report  submitted May 29, 2003 on Form 20-F (File No. 333-10976)).                                                                                                                                                                                                                                                                               |
| 4.21   |   | Dollar Multi-Borrower Credit  Facility, dated as of February 9, 2001 between Cableuropa S.A., Valencia  de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A., Mediterránea Norte  Sistemas de Cable, S.A., Región, de Murcia de Cable, S.A., Huelva de Cable y  Televisión, S.A., Cádiz de Cable y Televisión, S.A., Cable y Televisión de El  Puerto, Cable y Televisión de Andalucia, S.A., Corporación Mallorquina de  Cable, S.A., Albacete Sistemas de Cable, S.A., Santander de Cable, S.A.,  Univertel Comunicaçôes S.A., Hydra Servicios de Atencion al Cliente, S.A.,  and TDC Sanlúcar, S.A., as Borrowers, and ONO Finance PLC, as Lender, in  respect of ONO Finance Plc’s $150,000,000 14% Notes (incorporated by  reference to exhibit 10.26 of registrant’s Registration Statement submitted  May 17, 2001 on form F-4 (File No. 333-13530)). |
| 4.22   |   | Novation Agreement, dated  February 13, 2003, to Modify, without Termination, a Euro Multi-Borrower  Credit Facility dated February 9, 2001, between Cableuropa S.A.U.,  Valencia de Cable, S.A., Mediterránea Sur Sistemas de Cable, S.A.,  Mediterránea Norte Sistemas de Cable, S.A., Región de Murcia de Cable, S.A.,  Univertel Comunicaçôes Universais, S.A., Hydra Servicios de Atención al  Cliente, S.A., as Borrowers and ONO Finance PLC, as lender (incorporated by  reference to exhibit 4.22 of registrant’s annual report submitted  May 29, 2003 on Form 20-F (File No. 333-10976)).                                                                                                                                                                                                                                                                                 |
| 4.23   |   | Note Depositary Agreement, dated  February 9, 2001, by and between ONO Finance PLC and The Bank of New  York Trust Company (Cayman) Limited, in respect of ONO Finance PLC’s  $200,000,000 14% Notes (incorporated by reference to exhibit 10.27 of  registrant’s Registration Statement submitted May 17, 2001 on form F-4  (File No. 333-13530)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| 4.24   |   | Note Depositary Agreement,  dated February 9, 2001, by and between ONO Finance PLC and The Bank of  New York Trust Company (Cayman) Limited, in respect of ONO Finance PLC’s  $150,000,000 14% Notes (incorporated by reference to exhibit 10.28 of  registrant’s Registration Statement submitted May 17, 2001 on form F-4  (File No. 333-13530)).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
| 12.1   |   | Certification of the principal  financial officer pursuant to Section 302 of the Sarbanes-Oxley Act  2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 12.2   |   | Certification of the principal  executive officer pursuant to Section 302 of the Sarbanes-Oxley Act  2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| 13.1   |   | Certification by the principal  financial officer of periodic financial report pursuant to 18 U.S.C.  Section 1350, as mandated by Section 906 of the Sarbanes-Oxley Act.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| 13.2   |   | Certification by the principal  executive officer of periodic financial report pursuant to 18 U.S.C.  Section 1350, as mandated by Section 906 of the Sarbanes-Oxley Act.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

 

26

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**SIGNATURES**

 

Pursuant to the requirements of Section 12of the Securities Exchange Act of 1934, the Registrant certifies that it meetsall of the requirements for filing on Form 20-F and has duly caused thisreport to be signed on its behalf by the undersigned, thereunto dulyauthorized.

 
|                     | ONO FINANCE PLC |
|--------------------------|-----------------|
|                     | (Registrant)    |
|                     | By:             | /s/ Adrian Walton Gower |   |
|                     |            |   |
|                     |            | Adrian Walton Gower |
|                     |            | Director |
| Date: June 30, 2005 |            |   |

 

27

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**ONOFINANCE PLC**

**CONTENTS**

 
| Directors’  report                                                     |   |
|-----------------------------------------------------------------------------|--------|
| Report of Independent Registered Public Accounting  Firm                    |   |
| Profit and loss account and statement of total recognised gains and  losses |   |
| Balance sheet                                                               |   |
| Notes to the accounts                                                       |   |

 

F - 1

----

 

**ONOFINANCE PLC**

**DIRECTORS’REPORT**

**FORTHE YEAR ENDED 31 DECEMBER 2004**

 

The directors present theirreport on the affairs of ONO Finance PLC (“the Company”), together with theaccounts and auditors’ report for the year ended 31 December 2004.

 

**Principalactivity**

 

The principal activity of thecompany is that of a finance company. ONO Finance PLC’s business is theissuance of debt and the provision of debt finance to Cableuropa S.A.U. and itssubsidiary companies (“the Cableuropa Group”). The Cableuropa Group is one ofthe leading broadband telecommunications business in Spain.

 

**Review of thebusiness**

 

At the start of the year theCompany’s principal liability was under various loan notes (the “Notes”) andits principal asset various loans (the “Loans”) made to the Cableuropa Group.

 

During May and June 2004ONO Finance plc purchased certain of the 2009 and 2011 Notes. In addition, on17 May 2004 ONO Finance plc successfully closed a new bond issue. This newbond issue, which has a maturity of ten years, was sized at Euro 280 million,split between Euro 100 million of floating rate notes, priced at three monthEURIBOR plus a margin of 8.5%, and Euro 180 million of fixed rate notes, pricedat 10.5%. These were then further on-lent to Cableuropa Group at a margin of0.01%.

 

**Results and dividend**

 

The results for the period areshown on page F-5 and arise from continuing operations. The directorsrecommend no dividend for 2004 (2003: nil, 2002: £1.50 per share).

 

**Directors**

 

The directors, who held officeduring the period, had no interest in the shares of the company at any time.

 

The directors who served duringthe period were as follows

 

Mr. B D Needham (resignedon 15 July 2004)

Mr. P M Hills (deceased 12 December 2004)

Capita Trust Company Limited(appointed 15 July 2004)

Mr Adrian Gower (appointed 12 December 2004)

 

The directors receive noemoluments from the company or the group.

 

**Directorsresponsibilities**

 

The directors are required byCompany Law to prepare accounts for each financial year which give a true andfair view of the state of affairs of the company as at the end of the financialyear and of the profit or loss of the company for the financial year.

 

The directors are responsiblefor ensuring that the company keeps accounting records which disclose withreasonable accuracy the financial position of the company and which enable themto comply with the Companies Act 1985. They also have general responsibilityfor taking reasonable steps to safeguard the assets of the company and fortaking reasonable steps to prevent and detect fraud and other irregularities.

 

F - 2

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The directors confirm that, inpreparing the accounts, suitable accounting policies, consistently applied andsupported by reasonable and prudent judgements and estimates, have been usedand that applicable accounting and financial reporting standards have beenfollowed.

 

Information published on theinternet is available in many countries with different legal requirements.Legislation in the United Kingdom governing the preparation and disseminationof financial statements may differ from legislation in other jurisdictions.

 

**Supplierpayment policy**

 

The company’s policy is tosettle terms of payment with suppliers when agreeing the terms of eachtransaction, ensure that suppliers are made aware of the terms of payment andabide by the terms of payments. The trade creditors, expressed as a number ofdays, was zero as all trading expenses were paid by ONO Finance (Holdings)Limited (“the holding company”) which abides by these terms.

 

**Auditors**

 

The auditors,PricewaterhouseCoopers LLP, have indicated their willingness to continue inoffice and a resolution concerning their reappointment will be proposed at theAnnual General Meeting.

 

This report was approved andsigned on behalf of the Board on 23 June 2005.

 

**Director**

 

Clifford Chance Secretaries

10 Upper Bank Street

London

E14 5JJ

 

F - 3

----

 

**Report ofIndependent Registered Public Accounting Firm**

 

To the Board of Directors and Shareholdersof ONO Finance PLC.

 

We have audited the accompanyingbalance sheet of ONO Finance PLC as of December 31, 2004 and 2003, and therelated profit and loss account and the statement of recognised gains andlosses for each of the three years in the period ended December 31, 2004.These financial statements are the responsibility of the Company’s management.Our responsibility is to express an opinion on these financial statements basedon our audits.

 

We conducted our audits inaccordance with the Public Company Accounting Oversight Board (United States ofAmerica). Those standards require that we plan and perform the audit to obtainreasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidencesupporting the amounts and disclosures in the financial statements. An auditalso includes assessing the accounting principles used and significantestimates made by management, as well as evaluating the overall financial statementpresentation. We believe that our audits provide a reasonable basis for ouropinion.

 

In our opinion, the financialstatements referred to above present fairly, in all material respects, thefinancial position of ONO Finance Plc at December 31, 2004 and 2003, andthe results of its operations for each of the three years in the period ended December 31,2004 in conformity with accounting principles generally accepted in the UnitedKingdom.

 

Accounting principles generallyaccepted in the United Kingdom vary in certain significant respects fromaccounting principles generally accepted in the United States of America.Information relating to the nature and effect of such differences is presentedin Note 13 to the financial statements.

 

 

PricewaterhouseCoopers LLP

Chartered Accountants andRegistered Auditors

London

 

30 June 2005

 

F - 4

----

 

**ONOFINANCE PLC**

**PROFIT AND LOSSACCOUNT**

**FORTHE YEAR ENDED 31 DECEMBER 2004**

 
| ** **                                     | ** ** | **Notes**  | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2003** | ** ** | **Year ended  31 December  2002** | ** ** |
|------------------------------------------------|------------|------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|
| ** **                                     | ** ** | ** ** | ** ** | **£**                        | ** ** | **US$  (Note 1)**                 | ** ** | **£**                        | ** ** | **£**                        | ** ** |
| Interest  receivable and similar income        |       | 2          |       | 58,212,304                        |       | 111,534,775                       |       | 35,432,928                        |       | 88,695,480                        |       |
| Foreign  exchange gains/(losses), net          |       |       |       | (309                              | )          | (592                              | )          | 1,300                             |       | 9,941                             |       |
| Interest  payable and similar charges          |       | 3          |       | (58,184,051                       | )          | (111,480,642                      | )          | (35,410,071                       | )          | (88,629,172                       | )          |
| Profit on  ordinary activities before taxation |       |       |       | 27,944                            |       | 53,541                            |       | 24,157                            |       | 76,249                            |       |
| Tax on  profit on ordinary activities          |       | 4          |       | (5,000                            | )          | (9,580                            | )          | (4,240                            | )          | (9,335                            | )          |
| Profit on  ordinary activities after taxation  |       |       |       | 22,944                            |       | 43,961                            |       | 19,917                            |       | 66,914                            |       |
| Dividend                                       |       | 5          |       | —                            |       | —                            |       | —                            |       | (74,997                           | )          |
| Retained  profit/(loss) for the period         |       | 10         |       | 22,944                            |       | 43,961                            |       | 19,917                            |       | (8,083                            | )          |

 

The results for the period ariseentirely from continuing operations.

 

The accompanying notes are anintegral part of these accounts.

 

**STATEMENTOF RECOGNISED GAINS AND LOSSES**

**FORTHE YEAR ENDED 31 DECEMBER 2004**

 
| ** **                                                                                           | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2003** | ** ** | **Year ended  31 December  2002** | ** ** |
|------------------------------------------------------------------------------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|
| ** **                                                                                           | ** ** | **£**                        | ** ** | **US$  (Note 1)**                 | ** ** | **£**                        | ** ** | **£**                        | ** ** |
| Profit for  the financial period                                                                     |       | 22,944                            |       | 43,961                            |       | 19,917                            |       | 66,914                            |       |
| Revaluation  of equity value certificates due from Cableuropa Group due to exchange rate  difference |       | 6,327                             |       | 11,289                            |       | 1,383,148                         |       | (30,535,128                       | )          |
| Revaluation  of equity value certificates due to bondholders due to exchange rate  difference        |       | (6,327                            | )          | (11,289                           | )          | (1,383,148                        | )          | 30,535,128                        |       |
|                                                                                                 |       | 22,944                            |       | 43,961                            |       | 19,917                            |       | 66,914                            |       |

 

The accompanying notes are anintegral part of these accounts.

 

F - 5

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**ONOFINANCE PLC**

**BALANCESHEET AS AT 31 DECEMBER 2004**

 
| ** **                                               | ** ** | **Notes**  | ** ** | **31 December  2004** | ** ** | **31 December  2004** | ** ** | **31 December  2003** | ** ** | **31 December  2002** | ** ** |
|----------------------------------------------------------|------------|------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|
| ** **                                               | ** ** | ** ** | ** ** | **£**            | ** ** | **US$  (Note 1)**     | ** ** | **£**            | ** ** | **£**            | ** ** |
| Debtors: receivable  after more than one year            |       |       |       | 320,517,571           |       | 614,111,666           |       | 282,912,545           |       | 572,209,595           |       |
| Debtors:  receivable within one year                     |       |       |       | 14,704,154            |       | 28,173,159            |       | 32,170,463            |       | 59,931,601            |       |
| Total  debtors                                           |       | 6          |       | 335,221,725           |       | 642,284,825           |       | 315,083,008           |       | 632,141,196           |       |
| Cash at bank  and in hand                                |       |       |       | 61,820                |       | 118,448               |       | 43,552                |       | 85,745                |       |
| Current  assets                                          |       |       |       | 335,283,545           |       | 642,403,273           |       | 315,126,560           |       | 632,226,941           |       |
| Creditors:  amounts falling due within one year          |       | 7          |       | (10,211,620           | )          | (19,565,464           | )          | (15,419,513           | )          | (28,978,215           | )          |
| Total assets  less current liabilities                   |       |       |       | 325,071,925           |       | 622,837,809           |       | 299,707,047           |       | 603,248,726           |       |
| Creditors:  amounts falling due after more than one year |       | 8          |       | (325,008,171          | )          | (622,715,656          | )          | (299,666,237          | )          | (603,227,833          | )          |
| Net assets                                               |       |       |       | 63,754                |       | 122,153               |       | 40,810                |       | 20,893                |       |
| Capital and  Reserves                                    |       |       |       |                  |       |                  |       |                  |       |                  |       |
| Called up  share capital                                 |       | 9          |       | 12,502                |       | 23,954                |       | 12,502                |       | 12,502                |       |
| Profit and  loss account                                 |       | 10         |       | 51,252                |       | 98,199                |       | 28,308                |       | 8,391                 |       |
| Equity  shareholders’ funds                         |       | 10         |       | 63,754                |       | 122,153               |       | 40,810                |       | 20,893                |       |

 

The accounts on pages F-5to F-16 were approved by the Board on 23 June 2005.

 

Director:

 

Andrew Walton Gower

 

The accompanying notes are anintegral part of these accounts.

 

F - 6

----

 

**ONOFINANCE PLC**

**NOTES TO THEACCOUNTS**

**FORTHE YEAR ENDED 31 DECEMBER 2004**

 

**1.  Accounting policies**

 

The principal accountingpolicies are summarised below. They have all been applied consistentlythroughout the period.

 

**Basis ofaccounting**

 

The accounts have been prepared underthe historical cost convention and in accordance with applicable accountingstandards in the United Kingdom.

 

**Loans**

 

Borrowings are included asliabilities in the balance sheet at their proceeds, net of discount andexpenses. The expenses and discount are charged to loan interest in the profitand loss account over the term of the borrowing, using the effective interestmethod. Funds on lent to Cableuropa S.A.U. and its subsidiary companies (theCableuropa Group) are accounted for in exactly the same manner in order tomatch the borrowing and the debtor treatment.

 

**Finance costs**

 

Finance costs on borrowings arerecognised in the profit and loss account over the term of such instruments ata constant rate over the period of the instrument.

 

**Foreign exchange**

 

Transactions in foreigncurrencies are translated into sterling at the rates of exchange current at thedates of the transactions. Foreign currency monetary assets and liabilities inthe balance sheet are translated into sterling at the rates of exchange rulingat the end of the year. The resulting gain or loss is included as an exchangegain or loss in the profit and loss account.

 

**Taxation**

 

Corporation tax is provided ontaxable profits at the current rate. Full provision is made for deferred tax arisingfrom timing differences between the recognition of gains and losses in thefinancial statements and their recognition in tax computations, where futurepayment or receipt is more likely than not to occur.

 

**Cash flowstatement**

 

The company has taken advantageof the exemption in Financial Reporting Standard No 1 “Cash FlowStatements (revised 1996)” from producing a cash flow statement on the groundsthat it is a subsidiary undertaking where more than 90 per cent of the votingrights are controlled within a group and consolidated accounts for that groupare publicly available.

 

**Conveniencetranslation**

 

The financial statements arestated in United Kingdom pounds. The conversions of United Kingdom poundamounts into United States Dollars are included solely for the convenience ofreaders, using the noon buying rate certified for customs purposes by theFederal Reserve Bank of New York as of 31 December 2004, which wasUS$1.9160 to £1.

 

The convenience translationsshould not be construed as representations that the United Kingdom poundamounts have been, could have been, or could in the future be, converted intoUnited States Dollars at this or any other rate of exchange.

 

F - 7

----

 

**Revaluation oflisted investments**

 

Equity value certificates arestated at the estimated market value of Cableuropa, S.A.U. shares, and profitsand losses arising from this valuation are taken to the revaluation reserve.This is in accordance with the Alternative Accounting Rules noted in theCompanies Act 1985.

 

**2.  Interest receivable and similar income**

 

The interest receivable andsimilar income represents the interest receivable on the funds that have beenon-lent to the Cableuropa Group together with the amortisation of an upfrontfee received from the Cableuropa Group and also the amortisation of a feereceivable for maintenance of the facilities. The amortisation of theaforementioned fees is being recorded using the effective interest method.

 

**3.  Interest payable and similar charges**

 

The interest payable and similarcharges represent the interest incurred on the debentures issued (see note 8),together with the amortisation of the both costs incurred and the discount onthe issue of those debentures.

 

**4.  Taxation**

 

The tax charge comprises:

 

 
| ** **                            | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December**** ********2004** | ** ** | **Year ended  31 December  2003** | ** ** | **Year ended  31 December  2002** | ** ** |
|---------------------------------------|------------|-----------------------------------|------------|---------------------------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|
| ** **                            | ** ** | **£**                        | ** ** | **US$**                                           | ** ** | **£**                        | ** ** | **£**                        | ** ** |
| Current tax:                          |       |                              |       |                                              |       |                              |       |                              |       |
| UK  corporation tax                   |       | 5,309                             |       | 10,172                                            |       | 4,831                             |       | 15,250                            |       |
| Adjustment  in respect to prior years |       | (309                              | )          | (592                                              | )          | (591                              | )          | (5,915                            | )          |
|                                  |       | 5,000                             |       | 9,580                                             |       | 4,240                             |       | 9,335                             |       |

 

No temporary timing differenceshave arisen on the transactions of the company which would lead to a deferredtax charge/(credit) in the profit and loss account.

 

The difference between the totalcurrent tax charge shown above and the amount calculated by applying thestandard rate of UK Corporation tax to the profit before tax is as follows:

 
| ** **                                                                                                         | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2003** | ** ** | **Year ended  31 December  2002** | ** ** |
|--------------------------------------------------------------------------------------------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|
| ** **                                                                                                         | ** ** | **£**                        | ** ** | **US$**                           | ** ** | **£**                        | ** ** | **£**                        | ** ** |
| **Profit  on ordinary activities before taxation**                                                                 |       | 27,944                            |       | 53,541                            |       | 24,157                            |       | 76,249                            |       |
| Tax on  profit on ordinary activities at standard UK corporation tax rate of 19%  (2003: 20%; 2002: 20%) |       | 5,309                             |       | 10,172                            |       | 4,831                             |       | 15,250                            |       |
| **Effects  of:**                                                                                                   |       |                              |       |                              |       |                              |       |                              |       |
| Adjustment  in respect to prior years                                                                              |       | (309                              | )          | (592                              | )          | (591                              | )          | (5,915                            | )          |
| Current tax  charge for the year                                                                                   |       | 5,000                             |       | 9,580                             |       | 4,240                             |       | 9,335                             |       |

 

F - 8

----

 

**5.  Dividends**

 
| ** **                           | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2003** | ** ** | **Year ended  31 December  2002** | ** ** |
|--------------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|
| ** **                           | ** ** | **£**                        | ** ** | **US$**                           | ** ** | **£**                        | ** ** | **£**                        | ** ** |
| Proposed                             |       | —                            |       | —                            |       | —                            |       | 75,000                            |       |
| Adjustment  in respect of prior year |       | —                            |       | —                            |       | —                            |       | (3                                | )          |
|                                 |       | —                            |       | —                            |       | —                            |       | 74,997                            |       |

 

The adjustment in respect of theprior year in 2002 relates to the waiver of the 2001 dividend by CableuropaS.A.U.

 

**6.  Debtors**

 
| ** **                                                               | ** ** | **31 December  2004** | ** ** | **31 December  2004** | ** ** | **31 December  2003** | ** ** | **31 December  2002** | ** ** |
|--------------------------------------------------------------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|
| ** **                                                               | ** ** | **£**            | ** ** | **US$**               | ** ** | **£**            | ** ** | **£**            | ** ** |
| *Receivable  after more than one year*                                   |       |                  |       |                  |       |                  |       |                  |       |
| Loans to the  Cableuropa Group                                           |       | 302,564,870           |       | 579,714,290           |       | 264,966,171           |       | 555,646,369           |       |
| Amounts due  from Cableuropa in respect of the equity value certificates |       | 17,952,701            |       | 34,397,376            |       | 17,946,374            |       | 16,563,226            |       |
|                                                                     |       | 320,517,571           |       | 614,111,666           |       | 282,912,545           |       | 572,209,595           |       |
| *Receivable  within one year:*                                           |       |                  |       |                  |       |                  |       |                  |       |
| Indebtedness  with holding company                                       |       | —                |       | —                |       | —                |       | 7,059                 |       |
| Indebtedness  with the Cableuropa Group                                  |       | 14,704,154            |       | 28,173,159            |       | 32,170,463            |       | 59,924,542            |       |
|                                                                     |       | 335,221,725           |       | 642,284,825           |       | 315,083,008           |       | 632,141,196           |       |

 

The loans to the CableuropaGroup reflect the on-lending of the gross loans that are included in creditors(see note 8) and are repayable on the same terms. These are denominated in thesame currencies. The fixed rate loans bear interest at 14.01%, 16.252% and10.51% per annum. The floating rate loans bear interest at a margin of 0.01%above that of the bonds as described in note 8.

 

**7.  Creditors: amounts falling due within oneyear**

 
| ** **                         | ** ** | **31 December  2004** | ** ** | **31 December  2004** | ** ** | **31 December  2003** | ** ** | **31 December  2002** | ** ** |
|------------------------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|
| ** **                         | ** ** | **£**            | ** ** | **US$**               | ** ** | **£**            | ** ** | **£**            | ** ** |
| UK taxation                        |       | 5,597                 |       | 10,725                |       | 4,245                 |       | 15,250                |       |
| Proposed  dividend                 |       | —                |       | —                |       | —                |       | 75,000                |       |
| Indebtedness  with holding company |       | —                |       | —                |       | 8,188                 |       | —                |       |
| Accruals and  deferred income      |       | 10,206,023            |       | 19,554,739            |       | 15,407,080            |       | 28,887,965            |       |
|                               |       | 10,211,620            |       | 19,565,464            |       | 15,419,513            |       | 28,978,215            |       |

 

The accruals and deferred incomerepresents the interest payable on the Notes and the short-term portion of theamortisation for the maintenance fee in respect to the Notes due 2009 and 2011.

 

F - 9

----

 

**8.  Creditors: amounts falling due after morethan one year**

 
| ** **                                                         | ** ** | **31 December  2004** | ** ** | **31 December  2004** | ** ** | **31 December  2003** | ** ** | **31 December  2002** | ** ** |
|--------------------------------------------------------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|
| ** **                                                         | ** ** | **£**            | ** ** | **US$**               | ** ** | **£**            | ** ** | **£**            | ** ** |
| Notes:                                                             |       |                  |       |                  |       |                  |       |                  |       |
| 13% US$275m  Notes due 2009                                        |       | —                |       | —                |       | 50,076,645            |       | 165,390,534           |       |
| 13% Euro  125m Notes due 2009                                      |       | —                |       | —                |       | 31,335,259            |       | 78,838,661            |       |
| 14% Euro  200m Notes due 2010                                      |       | 78,845,038            |       | 151,067,092           |       | 78,576,834            |       | 127,172,669           |       |
| 14% US$200m  Notes due 2011                                        |       | 27,369,320            |       | 52,439,617            |       | 41,039,530            |       | 107,162,587           |       |
| 14% Euro  150m Notes due 2011                                      |       | 5,085,886             |       | 9,744,558             |       | 69,547,803            |       | 84,286,053            |       |
| 10.5% Euro  180m Notes due 2014                                    |       | 124,419,044           |       | 238,386,889           |       | —                |       | —                |       |
| Floating  Euro 100m Notes due 2014                                 |       | 68,787,320            |       | 131,796,505           |       | —                |       | —                |       |
| Equity value  certificates relating to the Notes due 2009 and 2011 |       | 17,952,701            |       | 34,397,376            |       | 17,946,374            |       | 16,563,226            |       |
| Accruals and  deferred income                                      |       | 2,548,862             |       | 4,883,619             |       | 11,143,792            |       | 23,814,103            |       |
|                                                               |       | 325,008,171           |       | 622,715,656           |       | 299,666,237           |       | 603,227,833           |       |

 

All Notes are repayable aftermore than 5 years.

 

The 13% Notes 2009 would havematured on 1 May 2009. However, the company could redeem some or all ofthe Notes at any time on or after 1 May 2004. The Company purchased all ofthese Notes during 2004, thereby reducing the liability to nil.

 

The 14% Notes 2010 will matureon 15 July 2010. However, the company may redeem some or all of the Noteson or after 15 July 2005.

 

The 14% Notes 2011 will matureon 15 February 2011. However, the company may redeem some or all of theNotes at any time on or after 15 February 2006. The company purchased someof the notes during the year.

 

The 10.5% Notes 2014 will matureon 15 May 2014. However the company may redeem some or all of the Notes atany time after May 15 2009.

 

The Floating Notes 2014 willmature on 15 May 2014. However the company may redeem some or all of theNotes at any time after May 15 2006.

 

13% US$275m Notes 275,000 unitsof $1,000 principal amount of dollar Notes and one dollar Equity valuecertificate were issued on 6 May 1999 at a discounted price ofUS$984.59/unit. Expenses of US$8,937,500 were incurred. Both the expenses anddiscount were netted from the gross amount of the loan and were being amortisedover the period of the loan. The unamortised amount related to the discount andexpenses at the balance sheet date of the units was US$ nil (2003:US$2,360,652, 2002: US$ 8,366,388).  182,902Notes were then redeemed on 13 February 2003. The remainder of the Noteswere purchased by the company during 2004 reducing the liability to nil.  The Equity value certificates are still inissue and entitle their holders to receive cash in an amount equal to themarket value of a number of shares of Cableuropa S.A.U. This number of sharescan be diluted in relation to the percentage of Cableuropa, S.A.U.’s totalshares under certain circumstances.

 

13% Euro125m Notes 125,000 unitsof Euro1,000 principal amount of Euro Notes and one Euro Equity valuecertificate were issued on 6 May 1999 at a discounted price of Euro984.59/unit. Expenses of Euro 4,062,500 were incurred. Both the expenses andthe discount were netted from the gross amount of the loan and were beingamortised over the period of the loan. The unamortised amount related to thediscount and expenses at the balance sheet date of the units was Euro nil (2003Euro 1,169,535, 2002 Euro 3,802,904). 79,372 Notes were then redeemed on 13 February 2003.The remainder of the Notes were purchased by the company during 2004 reducingthe liability to nil.  The Equity valuecertificates are still in issue and entitle their holders to receive cash in anamount equal to the market value of a number of shares of Cableuropa S.A.U.This number of shares can be diluted in relation to the percentage ofCableuropa, S.A.U.’s total shares under certain circumstances.

 

F - 10

----

 

14% Euro200m Notes 200,000 unitsof Euro 1,000 principal amount were issued on 30 June 2000 at a discountedprice of Euro 970/unit. The expenses of this issue have been borne by CableuropaS.A.U. The discount has been netted from the gross amount of the loan and isbeing amortised over the period of the loan. 86,298 Notes were then redeemed on13 February 2003. The unamortised amount related to the expenses at thebalance sheet date of the units was Euro 1,876,083 (2003 Euro 2,217,189, 2002Euro 4,500,000).

 

14% US$200m Notes 200,000 unitsof $1,000 principal amount of dollar Notes and one dollar Equity valuecertificate were issued on 9 February 2001 at a discounted price ofUS$862.04/unit. Expenses of US$6,000,000 were incurred. Both the expenses anddiscount have been netted from the gross amount of the loan and are beingamortised over the period of the loan. The unamortised amount related to theexpenses at the balance sheet date of the units was US$ 6,045,211 (2003 US$9,971,161, 2002 US$ 27,238,314). 116,486 Notes were then redeemed on 13 February 2003.A further 24,594 Notes were purchased by the company during 2004 leaving 58,920still in issue at 31 December 2004. The Equity value certificates entitletheir holders to receive cash in an amount equal to the market value of anumber of shares of Cableuropa S.A.U. This number of shares can be diluted inrelation to the percentage of Cableuropa, S.A.U.’s total shares under certain circumstances.

 

14% Euro150m Notes 150,000 unitsof Euro1,000 principal amount of Euro Notes and one Euro Equity valuecertificate were issued on 9 February 2001 at a discounted price of Euro862.04/unit. Expenses of Euro 4,500,000 were incurred. Both the expenses andthe discount have been netted from the gross amount of the loan and are beingamortised over the period of the loan. The unamortised amount related to thediscount and expenses at the balance sheet date of the units was Euro 824,687(2003 Euro 13,378,577, 2002 Euro 20,428,736).37,947 Notes were then redeemed on13 February 2003. A further 104,015 Notes were purchased by the companyduring 2004 leaving 8,038 still in issue at 31 December 2004. The Equityvalue certificates entitle their holders to receive cash in an amount equal tothe market value of a number of shares of Cableuropa S.A.U. This number ofshares can be diluted in relation to the percentage of Cableuropa, S.A.U.’stotal shares under certain circumstances.

 

10.5% Euro180m Notes 180,000units of Euro1,000 principal amount of Euro Notes were issued on 17 May 2004.Expenses of Euro 3,770,000 were incurred. The expenses have been netted fromthe gross amount of the loan and are being amortised over the period of theloan. The unamortized amount related to the expenses at the balance sheet datewas Euro 3,536,469.

 

Floating Euro100m Notes 100,000units of Euro1,000 principal amount of Euro Notes were issued on 17 May 2004.Expenses of Euro 2,600,000 were incurred. The expenses have been netted fromthe gross amount of the loan and are being amortised over the period of theloan. The unamortized amount related to the expenses at the balance sheet datewas Euro 2,438,944. The interest is charged at EURIBOR plus 8.5%.

 

All the Notes are fully andconditionally guaranteed, jointly and severally on a subordinated unsecuredbasis by companies in the Cableuropa Group.

 

The Equity value certificatesrelating to the 1999 and 2001 Notes, which were separated from the Notes whenthe Notes were exchanged for registered Notes, will be redeemable at theearliest of an initial public offering of Cableuropa S.A.U. or a reorganisationof the Cableuropa Group or 31 May 2009 (related to 1999 Notes) or 16 March 2011(related to 2001 Notes).

 

**9.  Called up share capital**

 

The authorised and issued sharecapital of the Company is £50,000 divided into 50,000 ordinary shares of £1each, of which two fully paid shares and 49,998 shares paid up to one quarterhave been issued.

 

The issued share capital is paidup as follows:—

 

F - 11

----

 

 
| ** **                                                                                    | ** ** | **31 December  2004** | ** ** | **31 December  2004** | ** ** | **31 December  2003** | ** ** | **31 December  2002** | ** ** |
|-----------------------------------------------------------------------------------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|-----------------------|------------|
| ** **                                                                                    | ** ** | **£**            | ** ** | **US$**               | ** ** | **£**            | ** ** | **£**            | ** ** |
| 2 fully paid  shares of £1 each, issued at par on incorporation.                         |       | 2                     |       | 4                     |       | 2                     |       | 2                     |       |
| 49,998 paid  up to one-quarter shares of £1 each, issued at par on 4 February 1999. |       | 12,500                |       | 23,950                |       | 12,500                |       | 12,500                |       |
|                                                                                          |       | 12,502                |       | 23,954                |       | 12,502                |       | 12,502                |       |

 

**10.  Reconciliation of movements in equityshareholders’ funds**

 
| ** **                                       | ** ** | **Share capital  2003** | ** ** | **Profit and loss  account  2003** | ** ** | **Total  2004** | ** ** | **Total  2003** | ** ** | **Total  2002** | ** ** |
|--------------------------------------------------|------------|-------------------------|------------|------------------------------------|------------|-----------------|------------|-----------------|------------|-----------------|------------|
| ** **                                       | ** ** | **£**              | ** ** | **£**                         | ** ** | **£**      | ** ** | **£**      | ** ** | **£**      | ** ** |
| Opening  equity shareholders’ funds         |       | 12,502                  |       | 28,308                             |       | 40,810          |       | 20,893          |       | 28,976          |       |
| Retained  profit/(loss) for the financial period |       | —                  |       | 22,944                             |       | 22,944          |       | 19,917          |       | (8,083          | )          |
| Closing  equity shareholders’ funds         |       | 12,502                  |       | 51,252                             |       | 63,754          |       | 40,810          |       | 20,893          |       |

 

**11.  Ultimate parent undertaking and controllingparty**

 

ONO Finance (Holdings) Limitedis the immediate parent undertaking of the company. The shares of ONO Finance(Holdings) Limited are in turn held by Royal Exchange Trust Company Limitedunder the terms of a Declaration of Trust for charitable purposes. Copies ofthose group accounts may be obtained from the Registrar of Companies.

 

Cableuropa S.A.U., a companyincorporated in Spain, is the largest group of which the company is a memberand for which group accounts are drawn up.

 

**12.  Related party transactions**

 

The company has taken advantageof the exemption in Financial Reporting Standard No 8 from disclosingtransactions with its holding company on the grounds that it is more than 90%owned.

 

The company is owned 98% by ONOFinance (Holdings) Limited and 2% owned by Cableuropa S.A.U. ONO Finance(Holdings) Limited has borne all administrative expenses of the company,including legal, accounting and rental costs. Accordingly, no administrativeexpenses have been recorded in the accompanying financial accounts. Inaddition, the directors receive no emoluments in respect of their services tothe company.

 

**13.  US GAAP**

 

ONO Finance Plc’s financial statementsare prepared in accordance with UK GAAP, which differ in certain respects fromthe accounting principles generally accepted in the United States (US GAAP).The principal differences between UK GAAP and US GAAP are presented anddescribed below, together with explanations of the adjustments that affect netincome and total shareholders’ equity as of 31 December 2004 and for theperiods indicated.

 

**Reconciliationof shareholders’ equity and net (loss)/profit**

 
| **Reconciliation  of shareholders equity**                | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2003** | ** ** | **Year ended  31 December  2002** | ** ** |
|-----------------------------------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|
| ** **                                                | ** ** | **£**                        | ** ** | **US$**                           | ** ** | **£**                        | ** ** | **£**                        | ** ** |
| **Shareholders’  equity in accordance with UK GAAP** |       | 63,754                            |       | 122,153                           |       | 40,810                            |       | 20,893                            |       |
| Proposed  dividend and waiver of prior year dividend      |       | —                            |       | —                            |       | —                            |       | 74,997                            |       |
| **Shareholders  equity in accordance with US GAAP**       |       | 63,754                            |       | 122,153                           |       | 40,810                            |       | 95,890                            |       |

 

F - 12

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| **Reconciliation  of net (loss)/profit**                              | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2004** | ** ** | **Year ended  31 December  2003** | ** ** | **Year ended  31 December  2002** | ** ** |
|-----------------------------------------------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|-----------------------------------|------------|
| ** **                                                            | ** ** | **£**                        | ** ** | **US$**                           | ** ** | **£**                        | ** ** | **£**                        | ** ** |
| **Retained  profit/(loss) for the period in accordance with UK GAAP** |       | 22,944                            |       | 43,961                            |       | 19,917                            |       | (8,083                            | )          |
| Proposed  dividend and waiver of prior year dividend                  |       | —                            |       | —                            |       | —                            |       | 74,997                            |       |
| **Net  profit in accordance with US GAAP**                            |       | 22,944                            |       | 43,961                            |       | 19,917                            |       | 66,914                            |       |

 

**Proposeddividends**

 

Under UK GAAP proposed dividendsare presented as a deduction at the foot of the profit and loss account,whereas under US GAAP, dividends are shown when declared, as a deduction in thestatement of changes in stockholders’ equity.

 

**Use ofEstimates in the Preparation of the Financial Statements**

 

The preparation of the financialstatements in conformity with generally accepted accounting principles requiresmanagement to make estimates and assumptions that affect the reported amountsand disclosure of assets and liabilities and disclosure of contingent assetsand liabilities at the date of the financial statements, and the reportedamounts of revenue and expenses during the reported period. Actual resultscould differ from those estimates

 

**Cash and cashequivalents**

 

Cash and cash equivalentsconsist of all cash in banks, cash in hand, and other equivalent instrumentswith original maturities of three months or less.

 

**Debt issuancecosts**

 

Under UK GAAP, debt issuancecosts of £5,703,160 (2003 £6,652,367) are netted against the carrying value ofthe related debt. Under US GAAP, these costs are reclassified as a long-termasset and amortised over the period of the debt. This difference inclassification gives rise to no differences in reported shareholders equity andnet income.

 

The company has considered theimpact of new accounting standards in the UK and the US and does not expectthem to have a material impact on the company’s financial statements.

 

F - 13

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**Financialinstruments**

 
| **31  December 2004** | ** ** | **Notional  amount** | ** ** | **Carrying  amount** | ** ** | **Fair  value** | ** ** |
|----------------------------|------------|----------------------|------------|----------------------|------------|-----------------|------------|
| ** **                 | ** ** | **£**           | ** ** | **£**           | ** ** | **£**      | ** ** |
| 13% US$ Notes  2009   |       | —               |       | —               |       | —          |       |
| 13% Euro Notes  2009       |       | —               |       | —               |       | —          |       |
| 14% Euro  Notes 2010       |       | 80,167,807           |       | 78,845,038           |       | 89,186,685      |       |
| 14% US$ Notes  2011   |       | 30,498 473           |       | 27,369,320           |       | 48,604,950      |       |
| 14% Euro  Notes 2011       |       | 5,667,348            |       | 5,085,886            |       | 6,517,450       |       |
| 10.5% Euro  Notes 2014     |       | 126,912,501          |       | 124,419,044          |       | 145,568,639     |       |
| Floating  Euro Notes 2014  |       | 70,506,945           |       | 68,787,320           |       | 76,147,500      |       |
|                       |       | 313,753,074          |       | 304,506,608          |       | 366,025,224     |       |

 
| **31  December 2004** | ** ** | **Notional  amount** | ** ** | **Carrying  amount** | ** ** | **Fair  value** | ** ** |
|----------------------------|------------|----------------------|------------|----------------------|------------|-----------------|------------|
| ** **                 | ** ** | **US$**              | ** ** | **US$**              | ** ** | **US$**         | ** ** |
| 13% US$ Notes  2009   |       | —               |       | —               |       | —          |       |
| 13% Euro Notes  2009       |       | —               |       | —               |       | —          |       |
| 14% Euro  Notes 2010       |       | 154,876,185          |       | 151,067,092          |       | 170,881,688     |       |
| 14% US$ Notes  2011   |       | 58,920,000           |       | 52,439,617           |       | 93,127,084      |       |
| 14% Euro  Notes 2011       |       | 10,948,750           |       | 9,744,558            |       | 12,487,435      |       |
| 10.5% Euro  Notes 2014     |       | 245,182,260          |       | 238,386,889          |       | 278,909,511     |       |
| Floating  Euro Notes 2014  |       | 136,212,367          |       | 131,796,505          |       | 145,898,611     |       |
|                       |       | 606,139,562          |       | 583,434,661          |       | 701,304,329     |       |

 
| **31  December 2003** | ** ** | **Notional  amount** | ** ** | **Carrying  amount** | ** ** | **Fair  value** | ** ** |
|----------------------------|------------|----------------------|------------|----------------------|------------|-----------------|------------|
| ** **                 | ** ** | **£**           | ** ** | **£**           | ** ** | **£**      | ** ** |
| 13% US$ Notes  2009   |       | 51,393,973           |       | 50,076,645           |       | 53,449,732      |       |
| 13% Euro  Notes 2009       |       | 32,159,571           |       | 31,335,259           |       | 32,963,561      |       |
| 14% Euro  Notes 2010       |       | 80,139,555           |       | 78,576,834           |       | 82,944,439      |       |
| 14% US$ Notes  2011   |       | 46,603,795           |       | 41,039,530           |       | 48,992,239      |       |
| 14% Euro  Notes 2011       |       | 78,977,305           |       | 69,547,803           |       | 81,741,510      |       |
| 10.5% Euro  Notes 2014     |       | —               |       | —               |       | —          |       |
| Floating  Euro Notes 2014  |       | —               |       | —               |       | —          |       |
|                       |       | 289,274,199          |       | 270,576,071          |       | 300,091,481     |       |

** **
| **31  December 2002** | ** ** | **Notional  amount** | ** ** | **Carrying  amount** | ** ** | **Fair  value** | ** ** |
|----------------------------|------------|----------------------|------------|----------------------|------------|-----------------|------------|
| ** **                 | ** ** | **£**           | ** ** | **£**           | ** ** | **£**      | ** ** |
| 13% US$ Notes  2009   |       | 170,580,133          |       | 165,390,534          |       | 55,438,543      |       |
| 13% Euro  Notes 2009       |       | 81,312,448           |       | 78,838,661           |       | 26,426,546      |       |
| 14% Euro  Notes 2010       |       | 130,099,917          |       | 127,172,669          |       | 42,282,473      |       |
| 14% US$ Notes  2011   |       | 124,058,279          |       | 107,162,587          |       | 40,318,940      |       |
| 14% Euro  Notes 2011       |       | 97,574,938           |       | 84,286,053           |       | 31,711,855      |       |
| 10.5% Euro  Notes 2014     |       | —               |       | —               |       | —          |       |
| Floating  Euro Notes 2014  |       | —               |       | —               |       | —          |       |
|                       |       | 603,625,715          |       | 562,850,504          |       | 196,178,357     |       |

 

The company could be exposed tocredit related losses due to the debt financing in place. The fair value isbased on the quoted market value of the Notes at 31 December 2004, 2003and 2002.

 

F - 14

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**Cash flowstatement**

 

 
| ** **                                             | ** ** | **Year ended 31  December** | ** ** | **Year ended 31  December** | ** ** | **Year ended 31  December** | ** ** | **Year ended 31  December** | ** ** |
|--------------------------------------------------------|------------|-----------------------------|------------|-----------------------------|------------|-----------------------------|------------|-----------------------------|------------|
| ** **                                             | ** ** | **2004**                    | ** ** | **2004**                    | ** ** | **2003**                    | ** ** | **2002**                    | ** ** |
| ** **                                             | ** ** | **£**                  | ** ** | **US$**                     | ** ** | **£**                  | ** ** | **£**                  | ** ** |
| **Cash  flows from operating activities:**             |       |                        |       |                        |       |                        |       |                        |       |
| Net income                                             |       | 22,944                      |       | 43,961                      |       | 19,917                      |       | 66,914                      |       |
| **Adjustments  to reconcile net income to net cash**   |       |                        |       |                        |       |                        |       |                        |       |
| **Operating  activities:**                             |       |                        |       |                        |       |                        |       |                        |       |
| Taxation                                               |       | 5,000                       |       | 9,580                       |       | 4,240                       |       | 9,335                       |       |
| Foreign  exchange transaction (gain)/loss              |       | —                      |       | —                      |       | —                      |       | (13,000                     | )          |
| Amortisation  of debt issuance costs and debt discount |       | 1,839,851                   |       | 3,525,154                   |       | 3,061,720                   |       | 5,320,321                   |       |
| Accretion of  discount on Notes receivable             |       | (1,839,851                  | )          | (3,525,154                  | )          | (3,061,720                  | )          | (5,320,321                  | )          |
| Non cash  interest payable                             |       | —                      |       | —                      |       | —                      |       | 17,607,776                  |       |
| Non cash  interest receivable                          |       | —                      |       | —                      |       | —                      |       | (17,607,776                 | )          |
| Interest  received from prior years                    |       | —                      |       | —                      |       | —                      |       | 79,664                      |       |
| (Increase)/decrease  in debtors                        |       | (9,676                      | )          | (18,539                     | )          | 8,650                       |       | (6,034                      | )          |
| (Decrease)  in creditors                               |       |                        |       |                        |       | —                      |       | —                      |       |
| Total  adjustments from operating activities           |       | 18,268                      |       | 35,002                      |       | 12,890                      |       | 69,965                      |       |
| **Financing  activities:**                             |       |                        |       |                        |       |                        |       |                        |       |
| Dividend  paid                                         |       | —                      |       | —                      |       | (75,000                     | )          | (74,997                     | )          |
| Net cash  flows                                        |       | 18,268                      |       | 35,002                      |       | (42,193                     | )          | 61,882                      |       |
| Cash and  cash equivalents, at beginning of period     |       | 43,552                      |       | 83,446                      |       | 85,745                      |       | 23,863                      |       |
| Cash and  cash equivalent, at end of period            |       | 61,820                      |       | 118,448                     |       | 43,552                      |       | 85,745                      |       |

 

Amounts stated are on a UK GAAPbasis.

 

Non-cash investing and financingactivities disclosure:

 

The cash proceeds from the debtissuance were received directly by the Cableuropa Group. Accordingly, the cashflow statement does not reflect receipt of these proceeds and a subsequentdisbursement to the Cableuropa Group.

 

**Accounting forderivative instruments and hedging activities**

 

The company has considered theimpact of new accounting standards in the UK and the US and does not expectthem have a material impact on the company’s financial statements.

 

**Revaluation ofEquity Value Certificates**

 

Under UK GAAP, changes in thevalue of the Equity value certificates are recorded in the statement ofrecognised gains and losses. Under US GAAP, such amounts are recorded underother comprehensive income. However, as the decrease in the value of the Equityvalue certificates related to the Company’s debt obligations is equivalent tothe decrease in the value of the related receivable from Cableuropa S.A.U.,there are no differences between net income, comprehensive income orshareholders’ equity between US and UK GAAP.

 

**Income taxes**

 

Provision for taxation has beenmade at the rate of 19%.

 

F - 15

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There are no temporarydifferences giving rise to deferred taxes in accordance with US generallyaccepted accounting principles.

 

**14.  Significant event**

 

ONO Finance plc announced atender offer (the “Tender Offer”) on April 16, 2004.  During May and June 2004 ONOFinance plc then purchased certain of the 2009 and 2011 Notes. In addition, on17 May 2004 ONO Finance plc successfully closed a new bond issue. This newbond issue, which has a maturity of ten years, was sized at Euro 280 million,split between Euro 100 million of floating rate notes, priced at three monthEURIBOR plus a margin of 8.5%, and Euro 180 million of fixed rate notes, pricedat 10.5%. These were then further on-lent to Cableuropa Group at a margin of0.01%.

 

The Notes outstanding and thoseloans to the Cableuropa Group immediately after these transactions are asfollows:

 
| ** **                    | ** ** | **Thousand of Euro or  US$(as applicable)** | ** ** |
|-------------------------------|------------|---------------------------------------------|------------|
| ** **                    | ** ** | **Outstanding Bonds**                       | ** ** | **Outstanding Loans  to the Cableuropa Group** | ** ** |
| ** **                    | ** ** | **Face**                                    | ** ** | **Interest Rate** | ** ** | **Total loan @  maturity** | ** ** | **Interest  Rate** | ** ** |
|                          |       |                                        |       |   |   |   |   |   |   |
| Euro Notes  due 2009          |       | —                                      |       | — |   | — |   | — |   |
| US$ Notes  due 2009      |       | —                                      |       | — |   | — |   | — |   |
| Euro Notes  due 2010          |       | 113,702                                     |       | 14.00 |   | 113,702 |   | 14.010 |   |
| Euro Notes  due 2011          |       | 8,038                                       |       | 14.00 |   | 8,038 |   | 16.252 |   |
| US$ Notes  due 2011      |       | 58,920                                      |       | 14.00 |   | 58,920 |   | 16.252 |   |
| Euro Fixed  Notes due 2014    |       | 180,000                                     |       | 10.50 |   | 180,000 |   | 10.510 |   |
| Euro  Floating Notes due 2014 |       | 100,000                                     |       | Euribor + 8.5 | % | 100,000 |   | Euribor + 8.51 | % |

 

**15.  Derivatives and other financial instruments**

 

The Company’s financialinstruments comprise borrowings, debtors and creditors that arise as a resultof normal operations. The Company does trade in financial instruments.

 

The main risk arising from theCompany’s financial instruments is foreign currency risk. However, as theonward lendings to Cableuropa Group are in the same currencies as theborrowings, any foreign currency exposure should be minimal. Details can befound in notes 6 and 8.

 

*Maturity offinancial instruments*

 

The maturity profiles of thecompany’s financial instruments are detailed in notes 6 and 8.

 

*Fair values*

 

The fair value of the financialliabilities at 31 December 2004 is detailed in note 13.

 

*Interest raterisk*

 

The company is not exposed tointerest rate risk as all interest rates on financial instruments are fixed asdetailed in notes 6 and 8 and finance raised by the issue of the financialinstruments are subsequently on lent at similar fixed rates of interest.

 

F - 16

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