TV Azteca Announces EBITDA of Ps.879 Million (US$81 million) in 3Q05, With a 42% Margin

TV Azteca Announces EBITDA of Ps.879 Million (US$81 million) in 3Q05, With a 42% Margin

- First Nine Months' EBITDA was Ps.2,560 Million (US$236 Million), With a 43% Margin -

MEXICO CITY, Oct. 18 /PRNewswire-FirstCall/ -- TV Azteca, S.A. de C.V. (NYSE:TZA) (BMV: TVAZTCA) (Latibex: XTZA), one of the two largest producers of Spanish-language television programming in the world, announced today an 8% reduction in net sales during the quarter to Ps.2,100 million (US$194 million), and a 10% decrease in EBITDA to Ps.879 million (US$81 million). EBITDA margin was 42%.

"The absence of extraordinary revenue derived from the 2004 Summer Olympic Games was significant this quarter, representing almost 12% of net revenues a year ago," said Mario San Roman, Chief Executive Officer of TV Azteca. "In addition, there were costs related to an acceleration of payments for the Mexican Soccer League exhibition rights and initiatives to enhance future revenue generation at Azteca America, which had a short-term effect on the company's EBITDA."

"From a perspective in which extraordinary events have a lesser relative impact, revenue and EBITDA for the first nine months of 2005 show greater stability. We anticipate that for the full year, such relative impact becomes even less relevant, as we foresee better results for the fourth quarter," added Mr. San Roman.

Third Quarter Results

Net sales decreased 8% to Ps.2,100 million (US$194 million), down from Ps.2,294 million (US$211 million) for the same quarter of 2004. Total costs and expenses declined 7% to Ps.1,221 million (US$113 million), from Ps.1,313 million (US$121 million) for the same period of last year. As a result, the company reported EBITDA of Ps.879 million (US$81 million), compared with Ps.981 million (US$90 million) in the third quarter of 2004. Net income was Ps.404 million (US$37 million), compared with net income of Ps.423 million (US$39 million) for the same period of 2004.

On a pro forma basis, excluding Ps.264 million (US$24 million) of revenue and Ps.147 million (US$14 million) of costs recorded during the quarter in connection with the transmission of the 2004 Summer Olympic Games, net sales increased 3% and EBITDA 2%.

Millions of pesos(a) and dollars(b) except percentages and per share amounts.

3Q 2004 3Q 2005 Change US$ % Net Sales Pesos Ps.2,294 Ps.2,100 -- -- US$ US$ 211 US$ 194 (18) -8% EBITDA(c) Pesos Ps.981 Ps.879 -- -- US$ US$ 90 US$ 81 (9) -10% Net Income Pesos Ps.423 Ps.404 -- -- US$ US$ 39 US$ 37 (2) -5% Income per CPO(d) Pesos Ps.0.14 Ps.0.14 -- -- US$ US$ 0.01 US$ 0.01 (0.001) -5%

(a) Pesos of constant purchasing power as of September 30, 2005. (b) Conversion based on the exchange rate of Ps. 10.85 per U.S. dollar as of September 30, 2005. (c) EBITDA is Profit Before Depreciation and Amortization under Mexican GAAP. (d) Calculated based on 2,986 million CPOs outstanding as of September 30, 2005.

Net Sales

"Despite effective programming and sales strategies, extraordinary revenue in 2004 was particularly large and was difficult to match during the quarter. Nevertheless, core growth when discounting extraordinary sales sustained its positive trend, and continues to generate larger expectations for the rest of the year," added Mr. San Roman.

Third quarter net revenue includes sales from Azteca America -- the company's wholly owned broadcasting network -- focused on the U.S. Hispanic market of Ps.116 million (US$11 million), 19% higher than Ps.98 million (US$9 million) for the same period a year ago. Azteca America revenue is composed of Ps.63 million (US$6 million) in sales from the Los Angeles station KAZA-TV, and Ps.53 million (US$5 million) from network sales.

TV Azteca also reported sales of programming to other countries of Ps.11 million (US$1 million), compared with Ps.24 million (US$2 million) for the third quarter of 2004. This quarter's programming exports were primarily driven by the company's novelas "La Otra Mitad del Sol," sold in Latin American markets, as well as "La Hija del Jardinero," sold primarily in European markets and in Africa.

During the quarter, TV Azteca did not register advertising and content sales of Azteca Web, a company through which TV Azteca controls 100% of the Grupo Todito site network. In the third quarter 2004, content and advertising sales to Todito.com were Ps.51 million (US$5 million).

As was previously announced, the first quarter of 2005 marked the end of a five-year service contract through which TV Azteca acquired 50% of Todito.com. During the second quarter, TV Azteca's Board approved a new agreement that divided Grupo Todito into two independent companies, which resulted in TV Azteca controlling 100% of the Grupo Todito site network, named Azteca Web. TV Azteca is in the process of legally constituting the division to consolidate Azteca Web results in the future. The company considers third quarter results for Azteca Web to not be material.

Barter sales were Ps.65 million (US$6 million), compared with Ps.105 million (US$10 million) in the same period of last year. Inflation adjustment of advertising advances was Ps.53 million (US$5 million), compared to Ps.94 million (US$9 million) for the third quarter of 2004.

Costs and Expenses

The 7% decline in costs and expenses was the result of the combined reduction of 8% in programming, production and transmission costs to Ps.934 million (US$86 million), from Ps.1,016 million (US$94 million) in the prior year, and a 3% decrease in administration and selling expense to Ps.287 million (US$26 million), from Ps.297 million (US$27 million) in the same quarter a year ago.

"The reduction in costs was lower than the cost that the 2004 Summer Olympic Games represented a year ago, primarily due to extraordinary amortizations from anticipated Mexican Soccer League games, and from production initiatives for the U.S. Hispanic market," said Carlos Hesles, Chief Financial Officer of TV Azteca. "We anticipate that the larger outlays will translate into future rewards coming from soccer related savings in the following quarter, and a better platform to attract larger audiences and clients at Azteca America."

The 3% reduction in administration and selling expense reflects reduced operating, services and travel expenses in the quarter. "The ongoing efforts to control expenses have translated into significant savings in every expense line, and we will not cease to search for additional sources to keep outlays under control," added Mr. Hesles.

EBITDA and Net Income

The 8% decrease in third quarter net sales, combined with a 7% reduction in costs and expenses, resulted in EBITDA of Ps.879 million (US$81 million), compared with Ps.981 million (US$90 million) a year ago. The EBITDA margin was 42% compared with 43% in the same period of 2004.

Below EBITDA, the company recorded depreciation and amortization of Ps.107 million (US$10 million) from Ps.100 million (US$9 million) a year ago, primarily reflecting a Ps.6 million (US$1 million) increase in depreciation due to growth in the balance of fixed assets at the end of the quarter.

The company recorded other expenses of Ps.98 million (US$9 million), compared with Ps.212 million (US$20 million) a year ago. Other expenses for the quarter were primarily comprised of charitable donations of Ps.46 million (US$4 million), legal fees of Ps.43 million (US$4 million), pre-operating expenses of Azteca America of Ps.9 million (US$1 million), and other items of Ps.14 million (US$1 million). There was also revenue from the recognition of 50% of the results of Todito.com and of Monarcas -- TV Azteca's soccer team -- of Ps.14 million (US$1 million).

Net comprehensive financing cost during the quarter was Ps.225 million (US$21 million), compared to Ps.231 million (US$21 million) a year ago. There was a Ps.1 9 million (U$2 million) gain in monetary position, compared to a Ps.28 million (US$3 million) loss in the same quarter a year ago. The gain in monetary position during the period reflects a net liability monetary position this quarter. Additionally, other financial expenses decreased Ps.16 million (US$1 million), reflecting commissions from new credit lines a year ago. Decreases in comprehensive financing cost were partially compensated by a Ps.41 million (US$4 million) increase in interest expense, primarily resulting from a higher level of debt with cost during the quarter. Interest income decreased Ps.14 million (U$1 million) due to a reduction in the company's cash balance.

The provision for income tax was Ps.45 million (US$4 million), compared to Ps.15 million (US$1 million) in the same period of the prior year, reflecting decreases in deferred taxes in the third quarter of 2004.

Third quarter's net income was Ps.404 million (US$37 million), compared to Ps.423 million (US$39 million) for the same period of 2004.

Uses of Cash

As was previously announced, TV Azteca's Annual Ordinary Shareholders' Meeting held on April 29 approved distributions for an aggregate amount of approximately US$80 million to be paid during 2005, under the company's cash- usage plan. US$59 million were paid on June 9, and another payment of approximately US$21 million is scheduled to be made December 1.

The distributions under the cash plan made to date represent an aggregate amount of US$384 million, equivalent to a 22% yield on the October 14, 2005, CPO closing price. Prior distributions include: US$125 million on June 30, 2003; US$15 million on December 5, 2003; US$33 million on May 13, 2004; US$22 million on November 11, 2004; and US$130 million on December 14, 2004. Distributions to shareholders have implied a reduction in the company's stockholders' equity.

As part of the cash usage plan, TV Azteca also expects to make significant debt reductions during the fourth quarter of 2005.

As has been detailed, the company's plan for uses of cash entails distributions of more than US$500 million and reductions in TV Azteca's debt by approximately US$250 million within a six-year period that started in 2003.

Debt Outstanding

As of September 30, 2005, the company's total outstanding debt was Ps.7,034 million (US$649 million). TV Azteca's cash balance was Ps.850 million (US$78 million), resulting in net debt of Ps.6,184 million (US$570 million). The total debt to last twelve months (LTM) EBITDA ratio was 1.9 times, and the net debt to EBITDA was 1.7 times. LTM EBITDA to net interest expense ratio was 5 times.

Excluding -- for analytical purposes -- Ps.1,299 million (US$120 million) debt due in 2069, total debt was Ps.5,735 million (US$529 million), and the total debt to EBITDA ratio was 1.6 times.

Selling of CPOs Underlying ADRs Concluded

As was previously announced, The Bank of New York (BoNY) concluded the sale -- in the Mexican Stock Market (BMV) -- of TV Azteca's Certificados de Participacion Ordinaria (CPOs) underlying American Depositary Receipts (ADRs) that were not surrendered by holders within the predetermined timeframe, in the process of termination of the ADR program the company had in the United States, trading on the New York Stock Exchange (NYSE).

ADR holders had a 60-day period -- from July 18, 2005, to September 16, 2005 -- to exchange their ADRs for CPOs traded on the BMV. On September 19, 2005, BoNY commenced the sale of the CPOs underlying the ADRs that were not surrendered. The sale of such CPOs by BoNY has concluded, and there are no remaining CPOs underlying ADRs that were not surrendered within the 60-day period.

TV Azteca is no longer listed on the NYSE. Trading of TV Azteca CPOs on the BMV, and Negotiating Units in the Spanish securities market Latibex remain.

The company previously announced that at an Extraordinary Shareholders' Meeting held on June 1, 2005, that 99.85% of TV Azteca's shareholders approved the termination of the ADR program, after an analysis and discussion of the costs and benefits of continuing being listed on a U.S. national securities exchange.

Nine Month Results

Millions of pesos(a) and dollars(b) except percentages and per share amounts.

9M 2004 9M 2005 Change US$ % Net Sales Pesos Ps.5,991 Ps.6,003 -- -- US$ US$ 552 US$ 553 1 0% EBITDA(c) Pesos Ps.2,594 Ps.2,560 -- -- US$ US$ 239 US$ 236 (2) -1% Net Income Pesos Ps.1,083 Ps.1,110 -- -- US$ US$ 100 US$ 102 2 +2% Income per CPO(d) Pesos Ps.0.36 Ps.0.37 -- -- US$ US$ 0.03 US$ 0.03 0.001 +2%

(a) Pesos of constant purchasing power as of September 30, 2005. (b) Conversion based on the exchange rate of Ps. 10.85 per U.S. dollar as of September 30, 2005. (c) EBITDA is Profit Before Depreciation and Amortization under Mexican GAAP. (d) Calculated based on 2,986 million CPOs outstanding as of September 30, 2005.

Company Profile

TV Azteca is one of the two largest producers of Spanish-language television programming in the world, operating two national television networks in Mexico, Azteca 13 and Azteca 7, through more than 300 owned and operated stations across the country. TV Azteca affiliates include Azteca America Network, a new broadcast television network focused on the rapidly growing U.S. Hispanic market, and Todito.com, an Internet portal for North American Spanish speakers.

Except for historical information, the matters discussed in this press release are forward-looking statements and are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Risks that may affect TV Azteca are identified in its Form 20-F and other filings with the U.S. Securities and Exchange Commission.

Investor Relations: Bruno Rangel Rolando Villarreal +011 52 (55) 1720 9167 +011 52 (55) 1720 0041 jrangelk@tvazteca.com.mxrvillarreal@gruposalinas.com.mx

Press Relations: Tristan Canales Daniel McCosh +011 52 (55) 1720 1441 +011 52 (55) 1720 0059 tcanales@gruposalinas.com.mxdmccosh@tvazteca.com.mx

TV AZTECA, S.A. DE C.V. AND SUBSIDIARIES CONSOLIDATED RESULTS OF OPERATIONS* (Millions of Mexican pesos of September 30, 2005, purchasing power)

Third Quarter of: 2004 2005 Net revenue Ps 2,294 Ps 2,100

Programming, production and transmission costs 1,016 934 Selling and administrative expenses 297 287 Total costs and expenses 1,313 1,221

EBITDA 981 879

Depreciation and amortization 100 107

Operating profit 881 772

Other expense -Net (212) (98)

Comprehensive financing cost: Interest expense (184) (225) Other financing expense (48) (32) Interest income 33 19 Exchange loss -Net (5) (6) (Loss) gain on monetary position (28) 19

Net comprehensive financing cost (231) (225)

Income before provision for income tax 438 449

Provision for income tax (15) (45)

Net income Ps 423 Ps 404

End of period exchange rate Ps 11.41 Ps 10.85

Third Quarter of: 2004 2005 Millions of U.S. Dollars** Net revenue US$ 211 100% US$ 194 100%

Programming, production and transmission costs 94 44% 86 44% Selling and administrative expenses 27 13% 26 14% Total costs and expenses 121 57% 113 58%

EBITDA 90 43% 81 42%

Depreciation and amortization 9 -- 10 --

Operating profit 81 38% 71 37%

Other expense -Net (20) -- (9) --

Comprehensive financing cost: Interest expense (17) -- (21) -- Other financing expense (4) -- (3) -- Interest income 3 -- 2 Exchange loss -Net (0) -- (1) -- (Loss) gain on monetary position (3) -- 2 --

Net comprehensive financing cost (21) -- (21) --

Income before provision for income tax 40 19% 41 21%

Provision for income tax (1) -- (4) --

Net income US$ 39 18% US$ 37 19%

Change % Net revenue US$ (18) -8%

Programming, production and transmission costs (8) -8% Selling and administrative expenses (1) -3% Total costs and expenses (8) -7%

EBITDA (9) -10%

Depreciation and amortization 1 --

Operating profit (10) -12%

Other expense -Net 10 --

Comprehensive financing cost: Interest expense (4) -- Other financing expense 1 -- Interest income (1) -- Exchange loss -Net (0) -- (Loss) gain on monetary position 4 --

Net comprehensive financing cost 1 --

Income before provision for income tax 1 2%

Provision for income tax (3) -- -- --

Net income US$ (2) -5%

End of period exchange rate

* Mexican GAAP. ** The U.S. dollar figures represent the Mexican peso amounts as of September 30, 2005, expressed as of September 30, 2005, purchasing power, translated at the exchange rate of Ps. 10.85 per U.S. dollar.

TV AZTECA, S.A. DE C.V. AND SUBSIDIARIES CONSOLIDATED RESULTS OF OPERATIONS* (Millions of Mexican pesos of September 30, 2005, purchasing power)

Nine months ended September 30, 2004 2005 Net revenue Ps 5,991 Ps 6,003

Programming, production and transmission costs 2,538 2,597 Selling and administrative expenses 860 846 Total costs and expenses 3,397 3,443

EBITDA 2,594 2,560

Depreciation and amortization 313 314

Operating profit 2,281 2,246

Other expense -Net (455) (344)

Comprehensive financing cost: Interest expense (571) (623) Other financing expense (81) (72) Interest income 130 58 Exchange loss -Net (15) (42) (Loss) gain on monetary position (82) 14

Net comprehensive financing cost (617) (665)

Income before provision for income tax 1,209 1,237

Provision for income tax (126) (127)

Net income Ps 1,083 Ps 1,110

End of period exchange rate Ps 11.41 Ps 10.85

Nine months ended September 30, 2004 2005 Net revenue US$ 552 100% US$ 553 100%

Programming, production and transmission costs 234 42% 239 43% Selling and administrative expenses 79 14% 78 14% Total costs and expenses 313 57% 317 57%

EBITDA 239 43% 236 43%

Depreciation and amortization 29 -- 29 --

Operating profit 210 38% 207 37%

Other expense -Net (42) -- (32 ) --

Comprehensive financing cost: Interest expense (53) -- (57 ) -- Other financing expense (7) -- (7 ) -- Interest income 12 -- 5 -- Exchange loss -Net (1) -- (4 ) -- (Loss) gain on monetary position (8) -- 1 --

Net comprehensive financing cost (57) -- (61 ) --

Income before provision for income tax 111 20% 114 21%

Provision for income tax (12) -- (12 ) --

Net income US$ 100 18% US$ 102 18%

Change % Net revenue US$ 1 0%

Programming, production and transmission costs 5 2% Selling and administrative expenses (1) -2% Total costs and expenses 4 1%

EBITDA (2) -1%

Depreciation and amortization 0

Operating profit (3) -2%

Other expense -Net 10 --

Comprehensive financing cost: Interest expense (5) -- Other financing expense 1 -- Interest income (7) -- Exchange loss -Net (3) -- (Loss) gain on monetary position 9 --

Net comprehensive financing cost (4) --

Income before provision for income tax 3 2%

Provision for income tax (0) --

Net income US$ 2 2%

* Mexican GAAP. ** The U.S. dollar figures represent the Mexican peso amounts as of September 30, 2005, expressed as of September 30, 2005, purchasing power, translated at the exchange rate of Ps. 10.85 per U.S. dollar.

TV AZTECA, S.A. DE C.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS* (Millions of Mexican pesos of September 30, 2005, purchasing power)

At September 30, 2004 2005 Current assets: Cash and cash equivalents Ps 1,366 Ps 850 Accounts receivable 3,353 2,965 Other current assets 986 964

Total current assets 5,705 4,779

Accounts receivable from Unefon 1,793 1,517 Account receivable from Pappas 1,522 1,400 Exhibition rights 921 840 Property, plant and equipment-Net 2,157 2,345 Television concessions-Net 4,124 4,230 Invesment in Todito 161 65 Other assets 1,089 973 Goodwill -Net 589 586 Deferred income tax asset -- 36 Total long term assets 12,356 11,992

Total assets Ps 18,061 Ps 16,771

Current liabilities: Short-term debt Ps 597 Ps 2,363 Other current liabilities 1,297 1,459

Total current liabilities 1,894 3,822

Long-term debt: Guaranteed senior notes 3,543 -- Structured Securities Certificates -- 2,745 Long-term debt 622 627 Total long-term debt 4,165 3,372 Other long term liabilities: American Tower Corporation (due 2019) 1,414 1,299 Advertising advances 3,120 2,420 Unefon advertising advance 2,094 1,758 Todito advances 92 -- Other long term liabilities 84 20 Deferred income tax payable 190 --

Total other long-term liabilities 6,994 5,497

Total liabilities 13,053 12,691

Total stockholders' equity 5,008 4,080

Total liabilities and equity Ps 18,061 Ps 16,771 0 -- End of period exchange rate Ps 11.41 Ps 10.85

At September 30, 2004 2005 Millions of US Dollars** Current assets: Cash and cash equivalents US$ 126 US$ 78 Accounts receivable 309 273 Other current assets 91 89

Total current assets 526 440

Accounts receivable from Unefon 165 140 Account receivable from Pappas 140 129 Exhibition rights 85 77 Property, plant and equipment-Net 199 216 Television concessions-Net 380 390 Invesment in Todito 15 6 Other assets 100 90 Goodwill -Net 54 54 Deferred income tax asset -- 3 Total long term assets 1,139 1,105

Total assets US$ 1,665 US$ 1,546

Current liabilities: Short-term debt US$ 55 US$ 218 Other current liabilities 120 134

Total current liabilities 175 352

Long-term debt: Guaranteed senior notes 327 -- Structured Securities Certificates -- 253 Long-term debt 57 58 Total long-term debt 384 311 Other long term liabilities: American Tower Corporation (due 2019) 130 120 Advertising advances 288 223 Unefon advertising advance 193 162 Todito advances 8 -- Other long term liabilities 8 2 Deferred income tax payable 18 --

Total other long-term liabilities 645 507

Total liabilities 1,203 1,170

Total stockholders' equity 462 376

Total liabilities and equity US$ 1,665 US$ 1,546

Change Current assets: % Cash and cash equivalents (48) -- Accounts receivable (36) -- Other current assets (2) --

Total current assets (85) -16%

Accounts receivable from Unefon (25) -- Account receivable from Pappas (11) -- Exhibition rights (7) -- Property, plant and equipment-Net 17 -- Television concessions-Net 10 -- Invesment in Todito (9) -- Other assets (11) -- Goodwill -Net (0) -- Deferred income tax asset 3 Total long term assets (34) -3%

Total assets (119) -7%

Current liabilities: Short-term debt 163 -- Other current liabilities 15 --

Total current liabilities 178 102%

Long-term debt: Guaranteed senior notes (327) -- Structured Securities Certificates 253 -- Long-term debt 0 -- Total long-term debt (73) -- Other long term liabilities: American Tower Corporation (due 2019) (11) -- Advertising advances (65) -22% Unefon advertising advance (31) -- Todito advances (8) -- Other long term liabilities (6) -- Deferred income tax payable (18) --

Total other long-term liabilities (138) -21%

Total liabilities (33) -3%

Total stockholders' equity (86) -19%

Total liabilities and equity (119) -7%

* Mexican GAAP. ** The U.S. dollar figures represent Mexican peso amounts as of September 30, 2005, expressed as of September 30, 2005, purchasing power, translated at the exchange rate of Ps. 10.85 per U.S. dollar.

TV AZTECA, S.A. DE C.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION Millions of Mexican pesos of September 30, 2005, purchasing power

Nine months ended September 30, 2004 2005 Operations: Net income Ps 1083 Ps 1110 Charges to results of operation not affecting resources: Amortization of goodwill 30 31 Depreciation 283 283 Equity in affiliates 9 11

Net change in accounts receivable, inventories, exhibition rights, related parties, accounts payable and accrued expenses 2,410 2,224 Unefon advertising advances (250) (288) Todito advertising, programming, and services advances (126) (59) Advertising advances (2,126) (2,707) Resources provided by operations 1,313 605

Investment:

Acquisition of property, machinery and equipment -Net (77) (437) Reimbursement of premium on issuance of capital stock of Todito -- 15 Resources used in investing activities (77) (422)

Financing:

Guaranteed senior notes (1,564) -- Bank loans, ATC loans and other debt -Net (301) 1,089 Stock options exercised 26 13 Preferred dividend paid (50) (25) Repurchase of shares (646) (39) Sale of treasury shares -- 603 Decrease in capital (611) (872) Effects of the merger of Servicios Deportivos TV into TV Azteca -- (489) Structured Securities Certificates -- 1,052 Banco Inbursa, S.A. -- (1,430) Loan collected from a related party 193 -- Financial instruments 428 -- Resources used in financing activities (2,525) (98) (Decrease) increase in cash and cash equivalents (1,289) 85 Cash and cash equivalents at beginning of period 2,655 765 Cash and cash equivalents at end of period Ps 1366 Ps 850

Source: TV Azteca, S.A. de C.V.

CONTACT: Investors, Bruno Rangel, +011-52-55-1720-9167, or jrangelk@tvazteca.com.mx, or Rolando Villarreal, +011-52-55-1720-0041, or rvillarreal@gruposalinas.com.mx; or Press, Tristan Canales, +011-52-55-1720-1441, or tcanales@gruposalinas.com.mx, or Daniel McCosh, +011-52-55-1720-0059, or dmccosh@tvazteca.com.mx, all of TV Azteca

Web site: http://www.tvazteca.com.mx/

------- Profile: Ent