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ABS-CBN Broadcasting Corporation

Sgt. Esguerra Avenue, Quezon City, Philippines

01 August 2006 To: Jurisita M. Quintos Senior Vice President Philippine Stock Exchange Geronimo C. Estacio Finance Officer in Charge Tel No. :(632) 688-7600 Fax No.:(632) 636-0809 Tel No. : (632) 924-4101 loc.4330 Fax No.: (632) 431-9368

From: Subject:

Amended 1st Quarter 2006 Report (SEC Form 17-Q)

Gentlemen: We are submitting herewith ABS-CBN Broadcasting Corporation’s Amended 1st Quarter 2006 Report (SEC Form 17-Q) in accordance with the received checklist of required disclosures, for which we have the following explanations: For the Consolidated Statements of Changes in Stockholders’ Equity, which SRC Rule 68.1 requires to show changes cumulatively for the current financial year-to-date with a comparative statement for the comparable year-to-date period of the immediately preceding financial year, we have inadvertently overlooked the correct equity schedule. For the Company’s and its majority-owned subsidiaries’ top five (5) key performance indicators, ABS-CBN has discussed these in its Management Discussion and Analysis (MD&A) of the Financial Condition and Results of Operations as shown in its division of different sections namely Revenues, Expenses, Operating Income, Net Income and EBITDA. We trust that we have sufficiently addressed your concerns. Very truly yours,

LYRA C. FAJARIT Investor Relations Manager

01 August 2006
April 27, 2006

COVER SHEET
1 8 0 3
S.E.C. Registration Numer

A B S - C B N

B R OADC AS T I NG

C O R P O R A T I ON

(Company's Full Name)

A B S - C B N

B R OADC AS T I NG
(Business Address: No. Street City / Town / Province)

C E NT E R C I T Y

S G T . E S G U E R R A

AVE . QUE Z ON

Lyra C. Fajarit
Contact Person

415-2272
Company Telephone Number

1 7 - QA
Day Month Fiscal Year FORM TYPE Day Month Annual Meeting

Secondary License Type, If Applicable

Dept. Requiring this Doc.

Amended Articles Number/Section Total Amount of Borrowings

Total No. of Stockholders

Domestic

Foreign

To be accomplished by SEC Personnel concerned

File Number

LCU

Document I.D.

Cashier

STAMPS

ABS-CBN BROADCASTING CORPORATION
SEC FORM 17-Q QUARTERLY REPORT PURSUANT TO SECTION 17 OF THE SECURITIES REGULATION CODE AND SRC RULE 17(b)(2) THEREUNDER
1. 2. 3. 4. 5. For the quarterly period ended March 31, 2006 SEC Identification No. 1803 BIR Tax Identification No. VAT 000-406-761-000 Exact name of registrant as specified in its charter : ABS-CBN Broadcasting Corporation Philippines _ Province, Country or other jurisdiction of incorporation or organization Industry Classification Code : _________ (SEC Use Only) ABS-CBN Broadcasting Center Complex, Sgt. Esguerra Avenue cor. Mo. Ignacia St.,Quezon City, Metro Manila Address of principal office (632) 924-41-01 up to 22 / 415-22-72 Registrant’s telephone no. and area code Not applicable _ Former name, address, and fiscal year, if changed since last report Securities registered pursuant to Sections 4 & 8 of the RSA: No. of Shares of Common Stock Title of Each Class Outstanding &/or Amount of Debt Outstanding 779,583,312 shares Common Stock, P 1 par value Are any or all of these securities listed on the Philippine Stock Exchange? Yes [x] 12. No [ ] 1100 _ Postal Code

6. 7.

8.

9.

10.

11.

Indicate by check mark whether the registrant: (a) has filed all reports required to be filed by Section 17 of the Securities Regulation Code and Sections 26 and 141 of the Corporation Code of the Philippines during the preceding 12 months (or for such shorter period that the registrant was required to file such reports): Yes [x] (b) No [ ]

has been subject to such filing requirements for the past 90 days. Yes [x] No [ ]

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TABLE OF CONTENTS

PART I -- FINANCIAL INFORMATION Item 1 Management’s Discussion and Analysis of Financial Condition and Results of Operations Item 2 Financial Statements Consolidated Balance Sheets Consolidated Statements of Income and Unappropriated Retained Earnings Consolidated Statements of Changes in Stockholders’ Equity Consolidated Statements of Cash Flows Notes to Financial Statements

PART II -- OTHER FINANCIAL INFORMATION Exhibit 1 Exhibit 2 Exhibit 3 Aging of Accounts Receivable Business Segment & Geographical Segment Results Roll-forward of PPE

SIGNATURES

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Management Discussion and Analysis of Financial Condition and Results of Operations for the Quarter Ended March 31, 2006 ABS-CBN Broadcasting Corp.’s net income reached P121 million in 1Q06, a reversal from last year’s P132 million loss. The turnaround in profitability is attributable to a lower cost base brought about by last year’s headcount optimization as well as more judicious production cost spending. Moreover, airtime revenues improved by 4% as the Company continued to strengthen its primetime programs. Revenues were also boosted by license fees from the migration of North American DTH (direct to home) subscribers to DirecTV’s platform. Revenues ABS-CBN Broadcasting Corp.’s (ABS-CBN) total revenues, consisting of gross airtime revenues, sale of services, license fees, and sale of goods grew 14% year on year (YoY) to P3,954 million in 1Q06 from P3,458 million in the same period last year.
Consolidated 1Q05 Variance Amount % 2,184 79 4 1,073 27 2 0 409 na 200 (18) (9) 3,458 497 14

Amounts in million pesos Airtime revenues Sale of services License fees Sale of goods Gross revenues

1Q06 2,263 1,100 409 182 3,954

Consolidated gross airtime revenues reached P2,263 million, up 4% compared to P2,184 million in 1Q05. Parent airtime revenues went up by 3% to P2,070 million. Although ratings were almost flat YoY at 14% in 1Q06, parent airtime revenues grew 3% due to a recovery in the primetime ratings in Metro Manila specifically in the 6pm to 10pm time block. From an average rating of 36% in 1Q05, it rose to 37% in 1Q06 for the 6pm to 10pm block in Metro Manila. Meanwhile, airtime revenues of other platforms namely the UHF and cable channels went up by 17%.
Consolidated 1Q05 Variance Amount % 2,019 51 3 165 28 17 2,184 79 4

Amounts in million pesos Parent airtime revenues Other platforms Gross airtime revenues

1Q06 2,070 193 2,263

License fees amounting to P409 million were booked in 1Q06. These represent revenues from the ongoing migration of existing US DTH (direct to home) subscribers to DirecTV’s platform as well as take up of new subscribers. Sale of services, which refer to revenues derived from cable and satellite programming services, film production and distribution, interactive media, content development and programming services, post production, text messaging, etc., grew slightly by 2% to P1,100 million. ABS-CBN Global, which contributed 70% of total, posted an 8% decline

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in sale of services to P769 million with the migration of DTH subscribers to DirecTV. ABS-CBN Global’s DTH subscription revenues in North America were reduced by half following the deal with DirecTV which provided for a 50:50 revenue sharing upon migration to DirecTV’s platform. Total subscriber base of ABS-CBN Global, on the other hand, grew by 22% YoY, translating to 2.1 million viewers worldwide by end-March.
Amounts in million pesos ABS-CBN Global Other subsidiaries Total sale of services 1Q06 769 331 1,100 1Q05 835 239 1,073 Variance Amount % (66) (8) 92 39 27 2

Other subsidiaries’ sale of services increased by 39% to P331 million in 1Q06 due to the strong performance of ABS-CBN Films. ABS-CBN Films released two movies in 1Q06 such as Don’t Give up on Us and Close To You as against only one film namely Dreamboy in 1Q05. Both of these films are also blockbuster hits hence posting higher movie receipts.
Amounts in million pesos ABS-CBN Global Other subsidiaries Total sale of goods 1Q06 103 79 182 1Q05 132 68 200 Variance Amount % (29) (22) 11 16 (18) (9)

Meanwhile, sale of goods which refer to revenues arising from the sale of consumer products such as magazines, audio, video products and phonecards, reached P182 million, down by 9% YoY. ABS-CBN Global, which accounted for 57% of total, posted a 22% drop in sale of goods after it stopped selling phonecards in the United States to concentrate on its core business. Expenses Total recurring expenses were down slightly by 2% to P3,511 million. However, including a non-recurring charge amounting to P208 million in marketing expenses related to migration in DirecTV, total expenses increased by 4% to P3,719 million.
Consolidated 1Q05 Variance Amount % 1,394 (116) (8) 976 185 19 600 22 4 444 59 13 165 9 5 3,578 141 4 0 0 na 3,578 (67) (2)

Amounts in million pesos Production cost General and administrative Cost of sales and services Agency commission, incentives, & co-prod share Other expenses Total expenses Less: non-recurring expense Total recurring expenses

1Q06 1,278 1,161 622 503 156 3,719 208 3,511

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Operating expenses consisting of production cost, cost of sales and services, general and administrative expenses, and agency commission increased by 4% to P3,563 million on account of higher cash operating expenses. Cash operating expenses went up by 7% while non-cash operating expenses dropped by 10%. If we strip-out the non-recurring marketing expense, total opex would have been down by 2% to P3,355 million. Total production cost declined by 8% to P1,278 million. Excluding non-cash charges such as depreciation and amortization, cash production cost dropped by 10% to P941 million. Since 2005, the Company has initiated efforts to cut production cost given lower revenues. For instance, the Company reduced local production and replaced certain timeslots with foreign soap operas and cartoons. Some star-driven shows were also replaced with less expensive concept driven programs starring new and lesser known talents.
Consolidated 1Q05 Variance Amount % 622 (76) (12) 195 (3) (2) 227 (24) (10) 1,044 (103) (10) 349 (13) (4) 1,394 (116) (8)

Amounts in million pesos Personnel expenses and talent fees Facilities related expenses Other program expenses Sub-total -cash production cost Non-cash production cost Total production cost

1Q06 546 192 203 941 336 1,278

Consolidated general and administrative expenses (GAEX) rose 19% YoY to P1,161 million. Excluding non-cash charges such as depreciation and amortization charges, consolidated cash GAEX rose 28% to P1,045 million. However, without the nonrecurring charge of P208 million, recurring cash gaex is up by only 3% YoY to P837million.
Consolidated 1Q05 Variance Amount % 408 12 3 20 220 1104 121 (9) (8) 86 (8) (9) 38 (2) (6) 6 (1) (9) 137 18 13 816 229 28 160 (44) (28) 976 185 19 0 0 na 976 (23) (2)

Amounts in million pesos Personnel expenses Advertising and promotions Facilities related expenses Contracted services Taxes and licenses Entertainment, amusement and recreation Other expenses Sub-total -cash GAEX Non-cash GAEX Total GAEX Less: non-recurring expense Total recurring GAEX

1Q06 420 240 112 78 35 5 154 1,045 116 1,161 208 953

Parent cash GAEX went up by 68% to P565 million, inclusive of non-recurring charges of P208 million, representing marketing expenses to encourage migration to DirecTV. Stripping-out this non-recurring charge, parent cash GAEX would have been up by 6%

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only to P357 million or in line with inflation growth. Meanwhile cash GAEX of the subsidiaries was flat at P480 million. Cost of sales and services, which is the cost related to sale of services and sale of goods, went up by 4% to P622 million as against flat combined sale of services and sale of goods.
Amount in million pesos ABS-CBN Global Other subsidiaries Total cost of sales and services 1Q06 382 240 622 1Q05 402 198 600 Variance Amount % (20) (5) 42 21 22 4

Non-cash operating expenses, composed primarily of depreciation and amortization, went down by 10% to P490 million from P545 million the previous year. Depreciation expense declined by 3% to P283 million due to controlled capex spending. Amortization, on the other hand, dropped by 18% to P207 million in 1Q06 from P253 million as the Company already completed the amortization of deferred subsidies on the decoder boxes of existing DTH subscribers in 2005. Moreover, film rights amortization dropped by 9% to P205 million due to lower cost of expiring titles. Operating Income With revenues rising faster at 14% as against expense growth of 4%, operating income increased by more than sevenfold to P391 million from P45 million in 1Q05. This translates to an operating margin of 10% compared to 1% in the same period last year. Net Income Other expenses declined by 6% to P156 million due to lower net finance costs and equity losses. Net finance costs went down by 6% to P245 million due to higher interest income from Beyond Cable. Moreover, equity losses declined to P13 million from P16 million in the same period last year due to lower losses of Beyond Cable. With the improvement in operating income and flat other expenses, the Company reported a net income of P121 million in 1Q06, a reversal from a net loss of P132 million in the same period last year. Earnings before interest, taxes, depreciation, and amortization (EBITDA) went up by 37% to P873 million, translating to an EBITDA margin of 22% from 18% last year. Balance Sheet Accounts As of end-March 2006, ABS-CBN had total consolidated assets of P23,974 million, 3% lower vs end-2005. Cash and cash equivalents declined by 29% to P1,241 million due to loan payments in 1Q06. Consolidated trade and non-trade receivables dropped by 10% to P4,223 million. In particular, net trade receivables declined by 10% to P3,390 million

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due to collections from DirecTV. This translates to consolidated trade days sales outstanding (DSO) of 70 days as against 81 days in 2005. Other current assets increased by 33% to P1,099 million due primarily to production expenses of yet to be aired episodes of the Company’s programs particularly soap operas such as Panday, Sa Piling Mo, and Gulong ng Palad. Since 2005, the Company begun the canning or advanced taping of some shows in order to cut location rentals and maximize efficiencies from production planning. At the end of the first quarter, total interest-bearing loans and borrowings declined by 11% to P5,600 million from P6,276 million in end-2005 following the payment of P676 million in loans in 1Q06. As a result, net debt to equity ratio declined slightly to 0.33x from 0.34x in 2005. Meanwhile, total capital expenditure including program rights acquisition amounted to P140 million in 1Q06, 4% higher vs last year.

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ABS-CBN BROADCASTING CORPORATION AND SUBSIDIARIES Consolidated Balance Sheets March 31, 2006 and December 31, 2005 (In Thousands, Except Par Value and Number of Shares)

2006 March Unaudited ASSETS Current Assets Cash and cash equivalents Trade and other receivables Derivative assets Program rights - current Other current assets Total Current Assets Noncurrent Assets Investment in associates Long-term receivables from related parties Property and equipment at cost - net Noncurrent program rights and other intangible assets Deferred tax assets Other noncurrent assets - net Total Non Current Assets

2005 December Audited

1,240,972 4,222,613 192,447 684,337 1,098,736 7,439,106 44,233 2,313,863 10,108,055 1,650,450 239,203 2,179,647 16,535,451 23,974,557

1,751,730 4,667,630 193,305 799,040 826,395 8,238,100 44,233 2,341,683 10,287,599 1,516,558 294,147 2,073,246 16,557,466 24,795,566

LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Trade and other payables Income tax payable Derivative liabilities Obligations for program rights - current Interest-bearing loans and borrowings - current Total Current Liabilities Noncurrent Liabilities Interest-bearing loans and borrowings - net of current portion Obligations for program rights - net of current portion Deferred tax liabilities - net Asset retirement obligation Total Noncurrent Liabilities Stockholders' Equity Capital Stock - P1 par value Authorized - 1,500,000,000 shares Issued and outstanding 779,583,312 shares Capital paid in excess of par value Cumulative translation adjustments Retained earnings Philippine depositary receipts convertible to common shares Total Stockholers' Equity attributable to Equity holders of Parent Company Minority Interest Total Stockholders' Equity

4,231,073 38,678 225,047 474,983 1,140,912 6,110,693 4,458,959 63,237 1,635 4,523,831

4,686,721 28,150 103,912 360,624 1,766,144 6,945,551 4,509,640 61,778 1,698 4,573,116

779,583 706,047 120,647 11,875,541 (200,000) 13,281,818 58,215 13,340,033 23,974,557

779,583 706,047 153,194 11,777,060 (200,000) 13,215,884 61,015 13,276,899 24,795,566

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ABS-CBN BROADCASTING CORPORATION AND SUBSIDIARIES Consolidated Statement of Income and Expenses For the period ended March 31 (Unaudited) (In Thousands)

For the period ended March 31 2006 2005 REVENUES Airtime revenues Sale of services License fees Sale of goods EXPENSES (INCOME) General and administrative Production costs Cost of sales and services Agency commission, incentives and co-producers' share Finance costs Finance revenue Equity in net losses of associates Foreign exchange (gain) loss - net Other income INCOME BEFORE INCOME TAX PROVISION FOR INCOME TAX NET INCOME Attributable to : Equity holders of Parent Company Minority Interest 2,262,796 1,100,170 409,401 182,089 3,954,457 1,160,648 1,277,554 622,130 502,871 310,657 (65,285) 13,095 (45,479) (56,848) 3,719,342 235,115 114,231 120,884 2,184,163 1,073,421 199,966 3,457,550 975,519 1,393,528 599,766 443,633 307,597 (46,726) 16,435 (57,621) (54,310) 3,577,820 (120,270) 11,351 (131,621)

121,343 (460) 120,884 872,925

(132,811) 1,191 (131,621) 623,063

EBITDA EARNINGS PER SHARE (EPS) Basic EPS

0.156

(0.170)

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ABS-CBN BROADCASTING CORPORATION AND SUBSIDIARIES Consolidated Statements of Changes in Stockholders' Equity March 31, 2006 and March 31, 2005 (In Thousands, Except Per Share Amounts)

Attributed to equity holders of parent Philippine Depository Receipts Convertible to Common Shares (200,000) (200,000) (200,000)

At January 1, 2006 Effect of adoption of PAS 19, 36 and 39 At January 1, 2006, as restated Minority interest Cash flow hedges Amortization of initial CTA Translation adjustments during the year Total income and expense for the year recognized directly in equity Net income Total income and expense for the year At March 31, 2006

Capital Stock 779,583 779,583 779,583

Capital in Excess of Par Value 706,047 706,047 706,047

Cumulative Translation Adjustments 153,194 153,194 (32,547) (32,547) (32,547) 120,647

Unappropriated Retained Earnings 3,477,060 (22,863) 3,454,197 121,343 121,343 3,575,540

Appropriated Retained Earnings 8,300,000 8,300,000 8,300,000

Total 13,215,884 (22,863) 13,193,021 (32,547) (32,547) 121,343 88,796 13,281,817

Minority Interest 61,015 61,015 (2,340) (2,340) (460) (2,800) 58,215

Total Equity 13,276,899 (22,863) 13,254,036 (2,340) (32,547) (34,887) 120,884 85,997 13,340,033

At December 31, 2004, as previously reported Effect of adoption of PAS 19 and 36 At December 31, 2004, as restated Effect of adoption of PAS 39 At January 1, 2005, as restated Minority interest Cash flow hedges Amortization of initial CTA Translation adjustments during the year Total income and expense for the year recognized directly in equity Net income Total income and expense for the year At March 31, 2005

779,583 779,583 779,583 779,583

706,047 706,047 706,047 706,047

138,334 138,334 138,334 138,334

3,629,483 3,629,483 3,629,483 (132,811) (132,811) 3,496,672

8,300,000 8,300,000 8,300,000 8,300,000

(200,000) (200,000) (200,000) (200,000)

13,353,447 13,353,447 13,353,447 (132,811) (132,811) 13,220,636

42,248 42,248 42,248 (34,015) (34,015) 1,191 (32,824) 9,424

13,395,695 13,395,695 13,395,695 (34,015) (34,015) (131,621) (165,636) 13,230,059

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ABS-CBN BROADCASTING CORPORATION AND SUBSIDIARIES CONSOLIDATED CASH FLOW STATEMENTS For the period ended March 31
(Unaudited) (In Thousands)

For the period ended March 31 2006 2005

CASH FLOWS FROM OPERATING ACTIVITIES Income from before income tax Adjustments for : Depreciation Interest expense Amortization of : Program rights Production and distribution Deferred charges and debt issue cost Provisions for : Doubtful accounts Interest income Equity in net losses of investees Mark to market (gain) loss Unrealized foreign exhange gain Gain on sale of property and equipment Operating income before working capital changes Decrease (increase) in : Receivables Program rights and other intangible assets Other current assets Increase (decrease) in : Trade and other payables Obligations for program rights Other non-current liabilities Cash generated from operations Income tax paid Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Additions to property and equipment Increase in : Other non-current assets Long-term receivables from related parties Investment in associates Interest received Proceeds from sale of property and equipment Net cash used in investing activities CASH FLOWS FROM FINANCING ACTIVITIES Interest and other financial charges paid Payments of : Long-term debt Bank loans Capital lease Cash and scrip dividends Proceeds from : Long-term debt Bank loans Net cash used in financing activities NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR CASH AND CASH EQUIVALENTS AT END OF YEAR

235,115 282,694 114,130 205,479 1,627 21,414 17,814 (65,285) 13,095 97,821 (80,080) 843,825 427,138 (35,925) (272,341) (474,392) (74,552) 413,752 (60,758) 352,994 (104,229) (108,881) 130,465 (21,480) 8,185 (95,941) (151,825) (279,252) (447,898) 18,664 92,500 (767,812) (510,758) 1,751,730 1,240,972

(120,270) 292,133 165,176 225,395 3,956 42,672 39,880 (44,902) 16,435 61,137 20,570 702,184 (771,081) (44,886) (229,436) 231,455 (66,927) 13,252 (165,440) (5,523) (170,962) (90,046) (220,825) 332,864 20,424 2,544 44,961 (170,556) (41,803) (416,943) (11,654) 749,155 33,000 141,199 15,198 1,291,557 1,306,755

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ABS-CBN BROADCASTING CORPORATION AND SUBSIDIARIES NOTES TO FINANCIAL STATEMENTS (Amounts in Thousands Unless Otherwise Specified)
1. Basis of Preparation The interim financial statements have been prepared in compliance with the accounting principles generally accepted in the Philippines as set forth in Philippine Financial Reporting Standards (PFRSs). The Company first adopted the transition to PFRSs in the 2005 annual financial statements. The Company applied PFRS 1, First-time adoption of PFRS, in preparing these financial statements, with January 1, 2004 as the date of transition. The transition to PFRSs resulted in certain changes to the Company’s previous accounting policies (referred to in the following tables and explanations as “previous GAAP”). The comparative figures for the 2005 interim financial statements were restated to reflect the changes in policies. 2. Accounting Policies and Methods The accounting policies adopted are consistent with those of the previous financial year except for the adoption of the following new/revised standards effective for financial years beginning on or after January 1, 2005: PAS 16, “Property, Plant and Equipment”; PAS 19, “Employee Benefits”; PAS 32, “Financial Instruments: Disclosure and Presentation”; PAS 39, “Financial Instruments: Recognition and Measurement”; and PFRS 3, “Business Combinations,” PAS 36 (revised) “Impairment of Assets” and PAS 38 (revised) “Intangible Assets.” An explanation of the effects of the adoption of PFRSs is set forth in the following tables and notes. Reconciliation of income and expenses for the first quarter of 2005 follows: Effect of transition to PFRS = P48 – 36,429 (782) – 67,298 – (72,850) (1,824) –

Previous GAAP REVENUES EXPENSES (INCOME) Production costs General and administrative Cost of sales and services Agency commission, incentives and co-producers’ share Finance costs Equity in net losses of associates Foreign exchange loss - net Finance revenue Other income = P3,457,503 1,393,528 939,091 600,548 443,633 240,299 16,435 15,229 (44,902) (54,310)

PFRS = P3,457,550 1,393,528 975,519 599,766 443,633 307,597 16,435 (57,621) (46,726) (54,310)

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3,549,550 INCOME BEFORE INCOME TAX PROVISION FOR INCOME TAX NET INCOME (92,048) 21,037 (P113,085) =

28,270 (28,222) (9,687) (18,536) Effect of transition to PFRS

3,577,820 (120,270) 11,351 (P131,621) =

Previous GAAP Attributable to: Equity Holders of the Parent Company Minority Interest

PFRS

(P114,275) = 1,191

(18,536)

(P132,811) = 1,191

Notes to the Reconciliation of Net Income for 1st quarter of 2005: a. PAS 16, “Property, Plant and Equipment” PAS 16 provides additional guidance and clarification on recognition and measurement of items of property, plant and equipment. It also provides that each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item shall be depreciated separately. This resulted to componentization of the Company’s building, which changed the estimated useful life of each significant item in the building account. The adjustment was taken in the consolidated financial statements prospectively and resulted to an increase in depreciation expense by =15.974 million in P 2005. b. PAS 19, “Employee Benefits” Under previous GAAP, pension benefits were actuarially determined using the entry age normal method and past service cost and experience adjustments, amortized over the expected average remaining working lives of the covered employees. Under PFRS, pension benefits are determined using the projected unit credit method. Actuarial gains and losses that exceed a 10% “corridor” are amortized over the expected average remaining working lives of participating employees and vested past service cost, recognized immediately. In addition, the Company recognized other long-term employee benefits which were not recognized in prior years. The Company also availed of the voluntary exemption under PFRS 1. The change increased personnel expenses by = P6.354 million in 2005. c. PFRS 3, “Business Combinations,” and PAS 38, “Intangible Assets” PAS 36, “Impairment of Assets,”

Under previous GAAP, intangible assets were considered to have a finite useful life with a rebuttable presumption that life would not exceed ten years from the date when the asset was available for use. Under PFRS, some of the intangible assets are regarded to have an indefinite useful life when, based on an analysis of all the relevant factors, there is no foreseeable limit to the period over which the asset is expected to generate net cash inflows for the Company. Accordingly, cable channels of Creative Programs, Inc (CPI) is considered to have an indefinite life and the useful life of the production and distribution business in the Middle East operations is changed from 10 to 25 years. Due to the change in the estimated useful life of the cable channels of CPI (from finite to indefinite), the carrying value of the cable channels as of January 1, 2005 is no longer amortized. Instead, it was tested for impairment. As of December 31, 2005, there was no impairment identified and the related amortization as of March 31, 2005 of P7.187 million was

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reversed. On the other hand, the change in estimated useful life of the production and distribution business in the Middle East operations resulted to an adjustment in the consolidated financial statements prospectively and resulted to a reversal of amortization expense by P 1.487 million in 2005. = d. PAS 32, “Financial Instruments: Disclosure and Presentation” PAS 32 covers the disclosure and presentation of all financial instruments. The standard requires more comprehensive disclosures about a company’s financial instruments, whether recognized or unrecognized in the financial statements. New disclosure requirements include terms and conditions of financial instruments used, types of risks associated with both recognized and unrecognized financial instruments (market risk, price risk, credit risk, liquidity risk, and cash flow risk), fair value information of both recognized and unrecognized financial assets and financial liabilities, and financial risk management policies and objectives. The standard also requires financial instruments to be classified as liabilities or equity in accordance with their substance and not their legal form. New disclosure requirements were included as a result of the adoption of the new standard. e. PAS 39, “Financial Instruments: Recognition and Measurement” PAS 39 establishes the accounting and reporting standards for recognizing and measuring a company’s financial assets and financial liabilities. The standard requires a financial asset or financial liability to be recognized initially at fair value. Subsequent to initial recognition, a company should continue to measure financial assets at their fair values, except for loans and receivables and held-to-maturity investments, which are to be measured at cost or amortized cost using the effective interest rate method. Financial liabilities are subsequently measured at cost or amortized cost, except for liabilities classified as “at fair value through profit and loss” and derivatives which are measured at fair value. PAS 39 requires the use of discounted cash flow techniques in determining impairment loss when objective evidence at impairment exists for financial assets that accounted for at fair value through profit or loss. PAS 39 also covers the accounting and reporting standards for derivative instruments. The standard has expanded the definition of a derivative instrument to include derivatives (derivative-like provisions) embedded in non-derivative contracts. Under the standard, every derivative instrument is recorded in the balance sheet as either an asset or a liability measured at its fair value. Derivatives that are not designated and do not qualify as hedges are adjusted to fair value through income. If the derivative is designated and qualifies as a hedge, depending on the nature of the hedge, changes in the fair value of derivatives are either offset against the change in fair value of the hedged assets, liabilities or firm commitments through earnings, or recognized in equity until the hedged item is recognized in earnings. A company must formally document, designate and assess the hedge effectiveness of derivative transactions that receive hedge accounting treatment. Adoption of this Standard resulted to: a. Implementation of the effective interest method resulted to P21.4 million of amortization in debt issue cost during the 1st quarter of 2006.

b. The Company recognized the fair value of its derivatives (freestanding and embedded) as of January 1, 2005. The fair value of freestanding derivatives which qualified for hedge accounting under previous GAAP was reported in CTA. Embedded derivatives were bifurcated from program rights and license agreements.

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Adoption of this standard has increased (decreased) the following accounts at March 31, 2005:
Increase / (Decrease)

Revenues Cost of Sales Mark to Market Loss Mark to Market Gain Foreign Exchange Gain/Loss –net Interest Expense Amortization of debt issue cost Provision for Income tax

48 (782) 62,961 1,824 72,850 1,052 3,284 (9,687)

c.

The Company tested its trade and other receivable for impairment in accordance with PAS 39 and resulted to an increase of P22.774 million in 2005 provision for bad debts.

d. The Company discounted its long-term non-interest-bearing payables to comply with PAS 39’s requirement to record all financial instruments at fair value upon initial recognition. Subsequently, these were carried at amortized costs. Other Adopted PFRSs The Company has also adopted the following under PFRSs. Comparative presentation and disclosures have been amended as required by the standards. Adoption of these standards has no effect on equity at March 31, 2005. PAS 1, “Presentation of Financial Statements”; PAS 8, “Accounting Policies, Changes in Accounting Estimates and Errors”; PAS 10, “Events after Balance Sheet Date”; PAS 24, “Related Party Disclosures”; PAS 27, “Consolidated and Separate Financial Statements”; and PAS 28, “Investments in Associates.”

3. Seasonality or Cyclicality of Interim Operations The company’s operations are not generally affected by any seasonality or cyclicality. 4. Nature and Amount of Changes of Estimates The effect of changes in estimates or amounts reported in prior interim periods do not have a material effect in the current interim period. 5. Repayments of Debt Repayments of long-term debt are scheduled as follows: 2006 2007 2008 2009 Total 1,450,616 1,758,667 1,842,677 683,303 5,735,263

16

6. Dividends paid No dividends were paid in the current interim period. No declaration of dividend payment has been made by the Board of Directors. 7. Earnings Per Share Computation Basic earnings per share are calculated by dividing the net income for the period attributable to common shareholders by the weighted average number of common shares outstanding during the period. Weighted average shares outstanding are 769,583,312. 8. Material Events A. Any known trends, demands, commitments, events or uncertainties that will have a material impact on the issuer's liquidity. -- In June 2004, the Company successfully signed a syndicated loan for US$120 million to refinance the Company’s existing debts and to fund further investments in cable television operations. The new loan is secured by the Company’s real property and certain equipment and other assets and will be guaranteed by certain of the Company’s subsidiaries. B. Any material commitments for capital expenditures, the general purpose of such commitments and the expected sources of funds for such expenditures. -- For 2006, ABS-CBN Broadcasting Corp. expects to invest approximately P1.2 billion for capital expenditure and acquisition of film and program rights, the same amount as in 2005. This funding requirement will be financed through internally generated funds. C. Any known trends, events or uncertainties that have had or that are reasonably expected to have a material favorable or unfavorable impact on net sales/revenues/income from continuing operations. -- ABS-CBN Broadcasting Corp.’s results of operations depend largely on the ability to sell airtime for advertising. The company’s business may be affected by the general condition of the economy of the Philippines. D. Any event that will trigger direct or contingent financial obligation that is material to the company, including any default or acceleration of an obligation. -- As of 31 December 2005, there are no events of default which may trigger a direct or contingent financial obligation that is material to the Company. The Senior Credit Agreement dated 18 June 2004 between the Company and several creditor banks contains customary events of default which may trigger material financial obligations on the part of the Company, such as, non-payment of financial obligations, breach of material provisions and covenants, cancellation of the Company’s key licenses, insolvency, cessation of business, expropriation, issuance of final judgment against the Company involving a significant amount, material adverse change in the operations and structure of the Company. The events that transpired last 04 February 2006 in connection with the celebration of the first year anniversary of the program "Wowowee" resulted in the death of 71 people and injury to about 200 others. The tragedy and the decision and subsequent action of the officers for the Company to shoulder the burial expenses of the dead and medical expenses of the injured,

17

did not result in any “direct or contingent financial obligation that is material to the Company.” As of February 2006, the Company has settled all of the funeral and medical expenses of the victims of the tragedy. Given the income flows and net asset base of the Company, said expenses do not constitute a material financial obligation of the Company, as the Company remains in sound financial position to meet its obligations. Although there have been investigations conducted by the government agencies on this incident, there has been no case(s) filed in court against the Company, its officers, or employees in connection herewith as of 30 March 2006. As a corporation which takes seriously its social and moral responsibility to the Filipino people it serves, the Company shall cooperate with government authorities, and will face any complaint or proceedings in any legal forum. E. Any significant elements of income or loss that did not arise from the issuer’s continuing operations. -- As of 31 March 2006, there are no significant elements of income that did not arise from the Company’s continuing operations. F. Any seasonal aspects that had a material effect on the financial condition or results of operations. -- There were no seasonal aspects that had a material effect on the financial condition or results of operations for the interim period. G. Any material events that were unusual because of their nature, size or incidents affecting assets, liabilities, equity, net income, or cash flows On June 1, 2005, the Parent Company and ABS-CBN International entered in to a 25-year Deal Memorandum (Memorandum) with DirecTV in which the Parent Company granted DirecTV the exclusive right via satellite, internet protocol technology and satellite master antenna television system or similar system, to display, exhibit, perform and distribute certain programs of the Parent Company that are listed in the Memorandum. ABS-CBN International may engage in any marketing plan mutually agreed by both parties and DirecTV may engage in ABS-CBN International. All costs under any mutually agreed marketing plans shall be shared equally between DirecTV and ABS-CBN International. As provided in the Memorandum, all rights, title and interest in and to the content, discrete programs or channels not granted to DirecTV are expressly reserved by the Parent Company. All programming decisions with respect to the programs shall be in the Parent Company’s commercially reasonable discretion, including the substitution or withdrawal of any scheduled programs, provided that the Parent Company agrees that the programs will consist substantially the same content and genre provided for in the Memorandum. The Memorandum also provides for the following license fees to be paid by DirecTV to the Parent Company: a. A license fee for each existing DTH subscriber of ABS-CBN International or new subscribers who becomes an activated subscriber during the migration period (from June 2005 to February 2006); and

18

b. An additional license fee for each activated subscriber who becomes an activated subscriber during the migration period that remains a subscriber for 14 consecutive months. The Memorandum also provides that subscription revenues, computed as the current and stand alone retail price per month for a subscription to the TFC channel multiplied by the average number of subscribers, shall be divided equally between DirecTV and ABS-CBN International. Starting July 2005, existing DTH subscribers of ABS-CBN International have been migrating to DirecTV. As of March 31, 2006, license fee amounting to P409 million have been = recognized in the consolidated financial statements. On January 17, 2006, the Parent Company and DirecTV agreed to amend the Memorandum entered in June 1, 2005 that include among others the extension of the migration period from February 2006 to August 2006. H. Any material events subsequent to the end of the interim period that have not been reflected in the financial statements for the interim period. -- There are no known material events subsequent to the end of the interim period that have not been reflected in the financial statements for the interim period.

9. Business Segment Results Segment information is prepared on the following bases: Business segments: for management purposes, the Company is organized into three business activities - broadcasting, cable and satellite, and other businesses. This segmentation is the basis upon which the Company reports its primary segment information. The broadcasting segment is principally the television and radio broadcasting activities which generates revenue from sale of national and regional advertising time. Cable and satellite business primarily develops and produces programs for cable television, including delivery of television programming outside the Philippines through its DTH satellite service, cable television channels and blocked time on television stations. Other businesses include movie production, consumer products and services. Geographical segments: although the Company is organized into three business activities, they operate in three major geographical areas. In the Philippines, its home country, the Company is involved in broadcasting, cable operations and other businesses. In the United States and other locations (which includes Middle East, Europe and Australia), the Company operates its cable and satellite operations to bring television programming outside the Philippines. Inter-segment transactions: segment revenue, segment expenses and segment results include transfers among business segments and among geographical segments. Such transfers are accounted for at competitive market prices charged to unaffiliated customers for similar services. Those transfers are eliminated in consolidation. Financial information on business segments and geographical segments is presented in Exhibit 2.

10. Changes in Composition of Issuer There are no changes in the composition of the Issuer since the last balance sheet date.

19

11. Changes in Contingent Liabilities or Assets There are no changes in contingent liabilities or contingent assets since the last balance sheet date. 12. Material Contingencies There are no contingent liabilities, events or transactions that will materially affect the company’s financial position and results of operations. 13. SFAS 16/IAS 16, “Property, Plant and Equipment.” (See Exhibit 3) 14. SFAS 24/IAS 24, “Related Party Disclosures.” Place of Ownership Interest 2005 Incorporation Principal Activities 2004 100.0(a) 100.0(a) Victoria, Cable and satellite Australia programming services 100.0(b) 100.0(b) ABS-CBN Center for Communication Philippines Educational/training Arts, Inc. 100.0(a) 100.0(a) ABS-CBN Europe Ltd United Cable and satellite Kingdom programming services 100.0 ABS-CBN Film Productions, Inc. Philippines Movie production 100.0 (ABS-CBN Films) 100.0 ABS-CBN Global Ltd. (ABS-CBN Cayman Holding company 100.0 Global) (c) Islands 100.0 100.0 ABS-CBN Interactive, Inc. Philippines Services - interactive media 98.0(a) ABS-CBN International California, Cable and satellite 98.0(a) USA programming services 100.0(a) 100.0(a) ABS-CBN Middle East FZ-LLC * Dubai, UAE Cable and satellite programming services 75.0(d) ABS-CBN Multimedia, Inc. Philippines Digital electronic 75.0(d) content distribution 100.0 Philippines Real estate 100.0 ABS-CBN Integrated and Strategic Property Holdings, Inc. (e) 100.0 ABS-CBN Publishing, Inc. (f) Philippines Print publishing 100.0 Creative Programs, Inc. Philippines Content development 100.0 100.0 and programming services 100.0(a) 100.0(a) E-Money Plus, Inc. Philippines Services – money remittance 100.0 Professional Services for Television & Philippines Services 100.0 Radio, Inc. Sarimanok News Network, Inc. (SNN) Philippines Content development 100.0 100.0 and programming services Company ABS-CBN Australia Pty. Ltd

20

Company Sky Films, Inc. (Sky Films) Star Recording, Inc.

Studio 23, Inc. (Studio 23)

TV Food Chefs Inc. Roadrunner Network, Inc. (Roadrunner) Star Songs, Inc.
(a) indirectly-owned (b) non-stock

Place of Ownership Interest 2005 Incorporation Principal Activities 2004 100.0 100.0 Philippines Services – film distribution 100.0 100.0 Philippines Audio and video production and distribution Philippines Content development 100.0 100.0 and programming services 100.0 100.0 Philippines Services - restaurant and food 98.9 Philippines Services - post 98.9 production 100.0 Philippines Music Publishing 100.0

through ABS-CBN Global ownership interest (c) with a branch in the Philippines (d) indirectly-owned through ABS-CBN Interactive, Inc. (e) not yet started commercial operations (f) owns 50% interest in Sky Guide, Inc. and 70% interest in Culinary Publications, Inc. * ABS-CBN Middle East FZ-LLC owns ABS-CBN Middle East LLC ABS-CBN Broadcasting Corporation is the ultimate Philippine parent entity and the ultimate parent company of the Company is Lopez, Inc. The following table provides the total amount of transactions, which have been entered into with related parties: Transactions of the Company with its associates and related parties follow:

2006 Associates Interest on noncurrent receivable from Sky Vision License fees charged by CPI to Central, (a) PCC and Home Cable Blocktime fees paid by Studio 23 to Amcara (b) Management and other service fees Affiliates Expenses paid by Parent Company & subsidiaries to Manila Electric Company (Meralco), Bayan Telecommunications Holding, Inc. (Bayantel) & other related parties Termination cost charges of Bayantel, a subsidiary of Lopez, to ABS-CBN Global Airtime revenue from Manila North Tollways Corp. (MNTC), Bayantel and Meralco, an associate of Lopez Expenses and charges paid for by the Parent Company which are reimbursed by the concerned related parties Rental charges of the Parent Company for the use of office space 57,165 24,735 13,887 206

2005 = P53,582 26,458 15,554 206

= P110,670 62,748

= P94,755 143,315

12,872

135

9.439 -

9,239 287

21

The related receivables and payables from related parties are as follows: 2006 = P166,637 61,333 = P227,970 = P56,734 240,164 = P296,898 2005 = P145,538 107,168 = P252,706 = P20,112 119,546 = P139,658

Due from associates Due from affiliates Total Due to associates Due to affiliates Total

Lopez, Inc. (Ultimate Parent) The Company has no transaction with Lopez, Inc. for the years 2006 and 2005. a. License Fees Charged by CPI to Central CPI entered into a cable lease agreement (Agreement) with Central for the airing of the cable channels (see Note 10) to the franchise areas of Central and its cable affiliates. The Agreement with Central is for a period of five years effective January 1, 2001, renewable upon mutual agreement. Under the terms of the Agreement, CPI receives license fees from Central and its cable affiliates computed based on agreed rates and on the number of subscribers of Central and its cable affiliates. As the owner of the said cable channels, CPI develops and produces its own shows and acquires program rights from various foreign and local suppliers. b. Blocktime Fees Paid by Studio 23 to Amcara Studio 23 owns the program rights being aired in UHF Channel 23 of Amcara. On July 1, 2000, it entered into a blocktime agreement with Amcara for its provincial operations. Other transactions with associates include cash advances for working capital requirements. Terms and Conditions of Transactions with Related Parties The sales to and purchases from related parties are made at normal market prices. Outstanding balances as of year-end are unsecured, interest free and settlement occurs in cash, except for the noncurrent receivables from SkyVision discussed in Note 8. For the quarters ended March 31, 2006 and 2005, the Company has not made any provision for doubtful accounts relating to amounts owed by related parties. This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates. As discussed in Note 15, the Parent Company’s obligation under the Senior Credit Agreement (SCA) is jointly and severally guaranteed by its principal subsidiaries. Compensation of key management personnel of the Company 2006 = P63,012 7,948 1,522 = P72,482 2005 = P89,580 8,032 980 = P98,592

Compensation Pension benefit Vacation leaves and sick leaves Termination benefits

22

15. SFAS 28/IAS 28, “Accounting for Investments in Associates.” The group’s investment in its associate is accounted for under the equity method of accounting. This is an entity in which the group has significant influence and which is not a subsidiary. The investment in its associate is carried in the balance sheets at cost plus post-acquisition changes in the group’s share of net assets of the associate, less any impairment in value. The statements of income reflects the group’s share of the results of operations of the associate. Unrealized gains arising from transactions with its associate are eliminated to the extent of the group’s interest in the associate, against the investment in the associate. Unrealized losses are eliminated similarly but only to the extent that there is no evidence of impairment of the asset transferred. The group’s investment in its associate includes goodwill (net of accumulated amortization) on acquisition, which is treated in accordance with the accounting policy for goodwill stated below. The detailed carrying values of investments which are carried under the equity method follow:
March 2006 Sky Vision Amcara December 2005

P= 44,233 P44,233 =

=P 44,233 = P44,233

16. Agency Commission, Incentives and Co-producers’ Share 2006 Agency commission Incentives and co-producers’ share = P336,061 166,810 = P502,871 2005 As restated = P322,157 121,475 = P443,633

17. Production Costs 2006 Personnel expenses and talent fees Facilities related expenses Amortization of program rights Depreciation Other program expenses = P545,818 192,112 179,660 156,493 203,470 = P1,277,554 2005 As restated = P621,758 195,201 201,569 147,789 227,210 = P1,393,528

18. Cost of Sales and Services 2006 Facilities related expenses Termination costs Inventory cost Personnel expenses Amortization of program rights Depreciation Other expenses = P133,182 136,463 75,211 45,538 25,819 12,293 193,624 = P622,130 2005 As restated = P153,628 143,315 103,261 36,754 23,826 11,973 127,008 = P599,766

23

19. General and Administrative Expenses 2006 Personnel expenses Depreciation Advertising and promotions Facilities related expenses Contracted services Provision for doubtful accounts Taxes and licenses Entertainment, amusement and recreation Other expenses = P420,097 113,907 239,953 111,626 78,079 17,814 35,428 5,394 138,350 = P1,160,648 2005 As restated = P408,390 132,370 19,934 121,108 85,723 39,880 37,828 5,948 124,337 = P975,519

20. Other Income and Expenses Other Income 2006 Space rental Management fees Royalty income Others = P22,422 0 3,452 30,974 = P56,848 2005 As restated = P21,475 0 3,363 29,472 = P54,310

Finance Revenue 2006 Interest income Mark-to-market gain = P65,285 0 = P65,285 2005 As restated = P44,902 1,824 = P46,726

Finance Cost 2006 Interest expense Hedge cost Amortization of debt issue costs Bank service charges Mark-to-market loss = P146,677 42,272 21,414 2,472 97,821 = P310,657 2005 As restated = P165,176 58,454 19,367 1,638 62,961 = P307,597

24

21. Financial Assets and Liabilities The following table sets forth the carrying values and estimated fair values of consolidated financial assets and liabilities recognized as of March 31, 2006. There are no material unrecognized financial assets and liabilities as of March 31, 2006. Carrying Amount Current financial assets: Cash and cash equivalents Trade and other receivables - net Derivative assets Total current financial assets Noncurrent financial assets Available-for-sale investments Long-term receivables from related parties Total noncurrent financial assets Total financial assets = P1,240,972 4,222,613 192,447 5,656,032 30,931 2,313,863 2,344,794 P =8,000,826 Carrying Amount Current financial liabilities: Trade and other payables Interest-bearing loans and borrowings Derivative liabilities Total current financial liabilities Noncurrent financial liabilities Interest-bearing loans and borrowings Total financial liabilities = P4,231,073 225,047 4,456,120 5,313,830 P =9,769,950 Fair Value = P1,240,972 4,222,613 192,447 5,656,032 30,931 2,313,863 2,344,794 = P8,000,826 Fair Value = P4,231,073 225,047 4,456,120 5,755,635 = P10,211,755

The following methods and assumptions were used to estimate the fair value of each class of financial instrument for which it is practicable to estimate such value: Cash and cash equivalents, trade and other receivables and trade and other payables: Due to the short-term nature of transactions, the fair values of these instruments approximate the carrying amount as of balance sheet date. Available-for-sale investments: The fair values were determined by reference to market bid quotes as of balance sheet date. Interest-bearing loans and borrowings: Fair value was computed based on the following:

Debt Type Term loan

Fair Value Assumptions Estimated fair value is based on the discounted value of future cash flows using the applicable risk free rates for similar types of loans adjusted for credit risk. The face value approximates fair value because of recent and frequent repricing based on market conditions.

Other variable rate loans

Forward foreign exchange contracts and bifurcated foreign currency forwards: The fair values were determined using forward exchange market rates at the balance sheet date.

25

Derivative Instruments Cross Currency Swaps. In 2004, the Parent Company entered into long-term cross currency swaps that hedge 100% of the Tranche A Principal against foreign exchange risk. The longterm principal-only currency swaps have an aggregate notional amount of US$52.1 million as of March 31, 2006 and a weighted average swap rate of P56.01 to US$1. Under these = agreements, the Parent Company effectively swaps the principal amount of certain US dollardenominated loans under the SCA into Philippine peso-denominated loans with payments up to June 2009. The Company is also obligated to pay swap costs based on a fixed rate of 8.0% on a notional amount of =1.3 billion, 5.125% on a notional amount =203 million, 3-month PHIREF minus P P 2.9% on a notional amount =1.7 billion and 3-month PHIREF minus 3.1% on a notional P amount on P264 million. = Interest Rate Swaps. To manage the interest rate exposure from the floating rate loans, the Company also entered into USD interest rate swaps and PHP interest rate swaps which effectively swap certain floating rate loans into fixed-rate loans. These USD interest rate swaps and PHP interest rate swaps have an aggregate outstanding notional amount of US$29.1 million and =283.8 million as of March 31, 2006, respectively, with payments up to P September 2006 and March 2008. The terms of the USD and PHP interest rate swap agreements are as follows: Outstanding Notional Amount US$29,138 PHP283,801 Maturity Receive 2008 3-Month Libor + 3.5% 2008 PHIREF + 3.5% Pay 7.18% 14.40%

Hedge Accounting Implications of Swaps. The Parent Company’s principal-only currency swaps and USD interest rate swap are designated as cash flow hedges on October 1, 2005, to manage the Parent Company’s exposure to variability in cash flows attributable to foreign exchange and interest rate risks of the underlying debt obligations. Since the critical terms of the swaps and the outstanding debt obligations coincide, the hedges are expected to exactly offset changes in expected cash flows due to fluctuations in foreign exchange and the prime rate over the term of the debt obligations. For the quarter ending March 31, 2006, the effective net mark-to-market losses for these cash flow hedges amounted to P119.6 million of which P24.5 million have been deferred in equity. = = The Parent Company did not designate its PHP interest rate swap as an accounting hedge because the effectiveness tests show ineffective results. During the year, the mark-to-market gains recorded immediately in the consolidated statements of income amounted to =15 P million. For the quarter ended March 31, 2006, the amortization of the initial CTA amounted to P7.7 = million and is recorded as a reduction in interest expense. Embedded Derivatives. As of December 31, 2005, the Company has outstanding embedded foreign currency derivatives which were bifurcated from various non-financial contracts. The impact of these embedded derivatives is not significant.

26

22. Causes for Material Changes in the Financial Statements Balance Sheet (March 31, 2006 vs December 31, 2005) • Cash and cash equivalents declined by 29% to P1,241 million due to loan payments made in 1Q06. • Trade and other receivables declined by 10% to P4,223 million due to collections from DirecTV. • Combined program rights-current and non-current program rights and other intangible assets is flat at P2,335 million. • Other current assets increased by 33% to P1,099 million from end-2005 levels due to production expenses of yet to be aired episodes of the Company’s programs. • Deferred tax assets went up 19% to P239 million from P294 million due to decrease in temporary tax differences. • Trade and other payables declined by 10% to P4,231 million due to payment of suppliers. • Total interest-bearing loans and borrowings decreased by 11% to P5,600 million from P6,276 million in end-2005 due to the scheduled amortizations in March. • The 32% increase in obligations for program rights-current to P475 million is due to extended credit terms given by program suppliers. • The change in income tax payable is the result of the ordinary course of business of the Company. 23. Other Notes to 1st Quarter 2006 Operations and Financials 23.1 The key performance indicators that we monitor are the following: YTD March 2006 3,954 million 2,263 million 1,100 million 182 million 391 million 121 million 873 million 0.16 As of March 31, 2006 1.22x 0.33x 70 days 76 days YTD March 2005 3,458 million 2,184 million 1,073 million 200 million 45 million (132) million 635 million (0.16) As of December 31, 2005 1.19x 0.34x 81 days 93 days

Gross Revenues Gross Airtime Revenues Sale of Services Sale of Goods Operating Income Net Income EBITDA EPS

Current Ratio Net debt-to-Equity Consolidated Trade DSO Parent Trade DSO

27

24. Note to Statements of Cash Flow 2006 Noncash investing and financing activities: Acquisition of property and equipment under capital lease Acquisition of program rights on account Acquisition of property and equipment on account 2005

= P21,552 190,370 -

= P89,496 130,841 -

25. Reclassifications The following accounts in March 31, 2005 consolidated financial statements have been reclassified to conform to the 2005 annual presentation: Nature Statement of Income: Gross-up of Agency commission, incentives and co-producers’ share to Sale of services Amortization, previously shown as a separate line item to: Production costs Cost of sales and services General and administrative expenses Amortization of Debt issue cost under “Finance Costs” Depreciation previously shown as a separate line item, shown to: Production costs Cost of sales and services General and administrative expenses Minority Interest previously included under Miscellaneous-Net to separate line item Bank service charges previously included under MiscellaneousNet to Finance costs Amortization of deferred charges previously classified under Cost of Sales to General and administrative expenses Amortization of deferred charges previously classified under General and administrative expenses to Finance Cost Foreign exchange loss previously classified under MiscellaneousNet to separate line item Interest Income previously included in Interest Expense to Finance Revenue Amount

56,355 201,569 47,914 12,630 16,083 147,789 11,973 116,396 1,191 1,638 23,305 16,083 15,229 44,902

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EXHIBIT 1
ABS - CBN BROADCASTING CORPORATION AGING OF ACCOUNTS RECEIVABLE AS OF MARCH 31, 2006

TYPE OF ACCOUNTS RECEIVABLE I. TRADE RECEIVABLES TRADE RECEIVABLES ALLOWANCE FOR DOUBTFUL ACCOUNTS NET AR - TRADE

TOTAL

NOT YET DUE

CURRENT

30 DAYS

60 DAYS

90 DAYS

120 - 360 DAYS

OVER 360 DAYS

PAST DUE & ITEMS IN LITIGATION

3,951,824 561,928 3,389,896

1,240,457

386,074

143,797

110,474

1,133,586

149,613

786,096

1,727

II. NON - TRADE RECEIVABLES ADVANCES TO SUPPLIERS & CONTRACTORS ADVANCES TO TALENTS ADVANCES AGAINST CLAIMS - SSS AR NON-TRADE OTHERS AR AFFILIATES Allowance for doubtful accounts NET AR - NON TRADE NET RECEIVABLES 129,539 42,285 7,709 437,653 227,970 (12,537) 832,717 4,222,613 3,784,337

ACCOUNTS RECEIVABLE DESCRIPTION 1 TRADE RECEIVABLES 2 NON TRADE RECEIVABLES NORMAL OPERATING CYCLE

- accumulated through the normal course of business i.e. sale of airing spots - accumulated through transactions other than sale of airing spots -calendar year

29

EXHIBIT 2 ABS-CBN Broadcasting Corporation Business Segment Data In Thousands

FOR THE PERIOD ENDED MARCH 31
BROADCASTING 2006 2005 Revenues External Sales Inter-segment sales Total Revenues Results Segment Result Equity in net earnings (losses) Other Income Finance Revenue Finance Cost Foreign exchange gain (loss) Income Tax Net Income (Loss) Assets and Liabilities Segment Assets Investment in equity method associates Consolidated Total Assets Segment Liabilities Other Segment Information Depreciation and amortization of program rights Noncash expenses other than depreciation and amortization of program rights CABLE AND SATELLITE 2006 2005 OTHER BUSINESSES 2006 2005 ELIMINATIONS 2006 2005 CONSOLIDATED 2006 2005

2,571,657 24,355 2,596,012

2,124,988 15,319 2,140,307

1,044,808 22,424 1,067,232

1,097,099 19,278 1,116,377

337,992 26,333 364,325

235,464 30,791 266,254

(73,112) (73,112)

(65,388) (65,388)

3,954,457 3,954,457

3,457,550 3,457,550

276,328 (37,608) 115,788 63,059 (308,452) 49,309 (82,818) 75,605

(121,702) 14,303 116,827 46,380 (306,775) 71,331 2,243 (177,393)

(87,565) 84,247 1,062 (2,135) 487 (9,279) (13,183)

86,969 3,256 3 (785) (10,814) (8,442) 70,186

53,090 6,216 1,163 (69) (4,317) (22,134) 33,949

1,752 3,250 343 (36) (2,895) (5,152) (2,738)

149,403 24,513 (149,403) 24,513

78,085 (30,738) (69,023) (21,676)

391,255 (13,095) 56,848 65,285 (310,657) 45,479 (114,231) 120,884

45,105 (16,435) 54,310 46,726 (307,597) 57,621 (11,351) (131,621)

19,644,178 3,598,254 23,242,432 4,037,593

20,434,445 2,636,139 23,070,584 2,915,157

5,353,944 5,353,944 2,721,743

4,917,868 4,917,868 3,300,168

1,211,577 1,211,577 637,188

888,414 371 888,785 502,819

(2,191,937) (3,554,021) (5,745,958) (2,339,765)

(2,215,793) (2,434,852) (4,650,645) (2,606,257)

24,017,762 44,233 24,061,995 5,056,758

24,024,934 201,658 24,226,591 4,111,887

415,874 11,127

450,810 19,367

52,089 7,653

45,445 43,844

20,210 660

21,273 523

-

-

488,173 19,441

517,528 63,735

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EXHIBIT 3 ABS-CBN Broadcasting Corporation and Subsidiaries Schedule of Property, Plant & Equipment Roll-Forward As of March 31, 2006 1,679,274,978.52 Land and Land Improvements Cost: Beginning Balance Additions Disposals Reclassifications Transfers to/ from subsidiaries At March 31 Accumulated depreciation: Beginning Balance Depreciation Charge for the year Disposals Reclassifications Transfers from subsidiaries At March 31 Net book value Building and Improvements Television, Radio, Movie and Auxiliary Equipment 5,521,641 23,801 (80,267) 5,465,175 4,466,109 95,759 (43,685) 4,518,182 946,993 3,218,694 44,332 (50,568) 89,579 3,302,037 2,517,821 72,004 (21,714) 44,574 2,612,686 689,351 118,777 62,983 (1,814) 179,946 179,946 18,935,445 132,003 (50,568) 0 19,016,881 8,647,846 282,694 (21,714) (0) 8,908,826 10,108,055 18,239,878 889,249 (193,683) Other Equipment Construction In Progress Equipment in Transit As of December 31 2006 December 31 2005

302,818 (3,835) 298,983 4,874 297 (3,676) 1,496 297,487

9,773,515 888 (3,663) 9,770,739 1,659,041 114,634 2,787 1,776,462 7,994,278

18,935,445 7,589,594 1,234,729 (176,477) 8,647,846 10,287,599

31