Azteca Announces 5% Net Sales Growth to Ps.2,327 Million in 1Q11

MEXICO CITY, April 26, 2011 /PRNewswire/ -- TV Azteca, S.A.B. de C.V. (BMV: AZTECA; Latibex: XTZA), one of the two largest producers of Spanish-language television programming in the world, announced today financial results for the first quarter of 2011.

"Again, we achieved superior results, as a consequence of strong demand for advertising spaces in our content, together with solid execution in the period", commented Azteca CEO Mario San Roman. "The higher demand is related to significant commercial audience levels during the full-day, resulting from our successful programming grid that was complemented with enormously attractive new content, in this quarter, in all of our channels."

First Quarter Results

Net sales were Ps.2,327 million, 5% above the Ps.2,221 million of the same quarter of 2010.  Total costs and expenses were Ps.1,550 million, compared to Ps.1,460 million in the same period of the previous year.

As a result, Azteca reported EBITDA of Ps.777 million, 2% above the Ps.761 million in the first quarter of 2010.  The EBITDA margin for the period was 33%.  The company registered net majority income of Ps.162 million,  23% above the Ps.132 from last year.

Net Sales

"The solid programming in the period translated into a 41% full-day commercial audience share in Mexico, what was the foundation for wide-reaching and high-impact advertising campaigns. Advertisers found an unparalleled structure to show the characteristics of their brands to target markets on our platform," added Mr. San Roman.

First quarter revenue includes sales at Azteca America—the company's wholly-owned broadcast television network focused on the U.S. Hispanic market—of Ps.209 million, 7% higher than the Ps.196 million a year ago.

Revenue from barter sales was Ps.58 million in the period, from Ps.67 million from the previous year.

Costs and Expenses

Total costs and expenses grew 6% in the quarter, as a result of an increase of the same magnitude in programming, production and transmission costs —to Ps.1,268 million, from Ps.1,191 million in the same period a year ago— and a 5% increase in selling and administrative expenses—to Ps.282 million, from Ps.269 million in the same quarter of 2010.

The increase in costs reflects the production of new successful content for our screens, which was translated into commercial audience share increases and strength in this period's income.

The selling and administrative expenses results are due to higher operating, personnel and services expenses, in the context of growing company operations.

EBITDA and Net Income

EBITDA was Ps.777 million, 2% above the Ps.761 million in the same period of the prior year.

The main change below EBITDA was a decrease of Ps.18 million in comprehensive financing cost, due mainly to lower interest cost on debt combined with higher interest on investments.

Net income for the period was Ps.162 million, 23% above of Ps.132 million from a year ago.

Debt

As of March 31, 2011, Azteca's outstanding debt —excluding Ps.1,433 million debt due 2069—was Ps.7,819 million.  The debt is peso denominated —congruent with most of the company income.

The cash balance of the company was Ps.5,658 million, 32% higher than Ps.4,288 million a year ago.

Net debt was Ps.2,161 million, 35% below the Ps.3,318 million from the previous year.  Debt to last twelve months (LTM) EBITDA ratio was 1.7 times, and net debt to LTM EBITDA was 0.5 times.

Company Profile

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.  Azteca affiliates include Azteca America Network, a broadcast television network focused on the rapidly growing U.S. Hispanic market, and Azteca Web, an Internet company for North American Spanish speakers.

Azteca is a Grupo Salinas company (www.gruposalinas.com), a group of dynamic, fast-growing, and technologically advanced companies focused on creating shareholder value, contributing to build the middle class of the countries in which they operate, and improving society through excellence.  Created by Mexican entrepreneur Ricardo B. Salinas (www.ricardosalinas.com), Grupo Salinas operates a as a management development and decision forum for the top leaders of member companies. The companies include: Azteca (www.irtvazteca.com), Azteca America (www.aztecaamerica.com), Grupo Elektra (www.grupoelektra.com.mx), Banco Azteca (www.bancoazteca.com.mx), Afore Azteca (www.aforeazteca.com.mx), Seguros Azteca (www.segurosazteca.com.mx) and Grupo Iusacell (www.iusacell.com).  Each of the Grupo Salinas companies operates independently, with its own management, board of directors and shareholders.  Grupo Salinas has no equity holdings.  However, member companies share a common vision, values and strategies for achieving rapid growth, superior results and world-class performance.

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.  Other risks that may affect Azteca and its subsidiaries are identified in documents sent to securities authorities.

SOURCE Azteca