-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 S0CX0Dm+QgEhcSOs7fnhyuiZzQzdfhXYkDLFSD8ZhzRTC/GOQ22AWhWza8LsfYTF
 repnP18XPK2niLNUAd1AXg==

<SEC-DOCUMENT>0000078150-07-000021.txt : 20070627
<SEC-HEADER>0000078150-07-000021.hdr.sgml : 20070627
<ACCEPTANCE-DATETIME>20070627162646
ACCESSION NUMBER:		0000078150-07-000021
CONFORMED SUBMISSION TYPE:	20-F
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20061231
FILED AS OF DATE:		20070627
DATE AS OF CHANGE:		20070627

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PHILIPPINE LONG DISTANCE TELEPHONE CO
		CENTRAL INDEX KEY:			0000078150
		STANDARD INDUSTRIAL CLASSIFICATION:	TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		20-F
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-03006
		FILM NUMBER:		07944056

	BUSINESS ADDRESS:	
		STREET 1:		RAMON CONJUANGCO BLDG
		STREET 2:		MAKATI AVE
		CITY:			MAKATI METRO MANILA
		STATE:			R6
		ZIP:			0721
		BUSINESS PHONE:		0116328143552

	MAIL ADDRESS:	
		STREET 1:		RAMON CONJUANGCO BLDG
		STREET 2:		MAKATI AVE
		CITY:			MAKATI METRO MANILA
		STATE:			R6
		ZIP:			0721
</SEC-HEADER>
<DOCUMENT>
<TYPE>20-F
<SEQUENCE>1
<FILENAME>pldtform20f2006.htm
<DESCRIPTION>PLDT 2006 FORM 20-F
<TEXT>
<html>

<head>
<meta content="text/html; charset=windows-1252">
<meta name=Generator content="Microsoft Word 11 (filtered)">
<title>pldt</title>

<!--
 /* Font Definitions */
 @font-face
	{font-family:Helvetica;
	panose-1:2 11 6 4 2 2 2 2 2 4;}
@font-face
	{font-family:Courier;
	panose-1:2 7 4 9 2 2 5 2 4 4;}
@font-face
	{font-family:"Tms Rmn";
	panose-1:2 2 6 3 4 5 5 2 3 4;}
@font-face
	{font-family:Helv;
	panose-1:2 11 6 4 2 2 2 3 2 4;}
@font-face
	{font-family:"New York";
	panose-1:2 4 5 3 6 5 6 2 3 4;}
@font-face
	{font-family:System;
	panose-1:0 0 0 0 0 0 0 0 0 0;}
@font-face
	{font-family:Wingdings;
	panose-1:5 0 0 0 0 0 0 0 0 0;}
@font-face
	{font-family:"MS Mincho";
	panose-1:2 2 6 9 4 2 5 8 3 4;}
@font-face
	{font-family:Batang;
	panose-1:2 3 6 0 0 1 1 1 1 1;}
@font-face
	{font-family:SimSun;
	panose-1:2 1 6 0 3 1 1 1 1 1;}
@font-face
	{font-family:PMingLiU;
	panose-1:2 1 6 1 0 1 1 1 1 1;}
@font-face
	{font-family:"MS Gothic";
	panose-1:2 11 6 9 7 2 5 8 2 4;}
@font-face
	{font-family:Dotum;
	panose-1:2 11 6 0 0 1 1 1 1 1;}
@font-face
	{font-family:SimHei;
	panose-1:2 1 6 0 3 1 1 1 1 1;}
@font-face
	{font-family:MingLiU;
	panose-1:2 1 6 9 0 1 1 1 1 1;}
@font-face
	{font-family:Mincho;
	panose-1:2 2 6 9 4 3 5 8 3 5;}
@font-face
	{font-family:Gulim;
	panose-1:2 11 6 0 0 1 1 1 1 1;}
@font-face
	{font-family:Century;
	panose-1:2 4 6 4 5 5 5 2 3 4;}
@font-face
	{font-family:"Angsana New";
	panose-1:2 2 6 3 5 4 5 2 3 4;}
@font-face
	{font-family:"Cordia New";
	panose-1:2 11 3 4 2 2 2 2 2 4;}
@font-face
	{font-family:Mangal;
	panose-1:0 0 4 0 0 0 0 0 0 0;}
@font-face
	{font-family:Latha;
	panose-1:2 0 4 0 0 0 0 0 0 0;}
@font-face
	{font-family:Sylfaen;
	panose-1:1 10 5 2 5 3 6 3 3 3;}
@font-face
	{font-family:Vrinda;
	panose-1:0 0 4 0 0 0 0 0 0 0;}
@font-face
	{font-family:Raavi;
	panose-1:2 0 5 0 0 0 0 0 0 0;}
@font-face
	{font-family:Shruti;
	panose-1:2 0 5 0 0 0 0 0 0 0;}
@font-face
	{font-family:Sendnya;
	panose-1:0 0 4 0 0 0 0 0 0 0;}
@font-face
	{font-family:Gautami;
	panose-1:2 0 5 0 0 0 0 0 0 0;}
@font-face
	{font-family:Tunga;
	panose-1:0 0 4 0 0 0 0 0 0 0;}
@font-face
	{font-family:"Estrangelo Edessa";
	panose-1:0 0 0 0 0 0 0 0 0 0;}
@font-face
	{font-family:"Arial Unicode MS";
	panose-1:2 11 6 4 2 2 2 2 2 4;}
@font-face
	{font-family:Tahoma;
	panose-1:2 11 6 4 3 5 4 4 2 4;}
@font-face
	{font-family:"Times New Roman Bold";
	panose-1:0 0 0 0 0 0 0 0 0 0;}
@font-face
	{font-family:"interest rate risk";
	panose-1:0 0 0 0 0 0 0 0 0 0;}
@font-face
	{font-family:"MS Song";}
@font-face
	{font-family:"Arial Narrow";
	panose-1:2 11 5 6 2 2 2 3 2 4;}
@font-face
	{font-family:Times;
	panose-1:2 2 6 3 5 4 5 2 3 4;}
@font-face
	{font-family:"\@SimSun";
	panose-1:0 0 0 0 0 0 0 0 0 0;}
@font-face
	{font-family:"\@PMingLiU";
	panose-1:0 0 0 0 0 0 0 0 0 0;}
@font-face
	{font-family:"\@MS Mincho";
	panose-1:0 0 0 0 0 0 0 0 0 0;}
@font-face
	{font-family:"\@Arial Unicode MS";
	panose-1:2 11 6 4 2 2 2 2 2 4;}
 /* Style Definitions */
 p.MsoNormal, li.MsoNormal, div.MsoNormal
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
h1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman Bold";
	text-transform:uppercase;
	font-weight:bold;}
h2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:justify;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;
	text-decoration:underline;}
h3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:justify;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
h4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.6in;
	text-align:justify;
	text-indent:-.1in;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:normal;
	font-style:italic;}
h5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:justify;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:normal;
	font-style:italic;}
h6
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.MsoHeading7, li.MsoHeading7, div.MsoHeading7
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.9in;
	text-align:center;
	text-indent:-.2in;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.MsoHeading8, li.MsoHeading8, div.MsoHeading8
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:1.0in;
	text-align:justify;
	text-indent:-.3in;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.MsoHeading9, li.MsoHeading9, div.MsoHeading9
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:1.1in;
	text-align:justify;
	text-indent:-.1in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoIndex1, li.MsoIndex1, div.MsoIndex1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:12.0pt;
	margin-bottom:.0001pt;
	text-indent:-12.0pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.MsoToc1, li.MsoToc1, div.MsoToc1
	{margin:0in;
	margin-bottom:.0001pt;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.MsoToc2, li.MsoToc2, div.MsoToc2
	{margin-top:0in;
	margin-right:.05in;
	margin-bottom:0in;
	margin-left:0in;
	margin-bottom:.0001pt;
	text-indent:-5.4pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.MsoToc3, li.MsoToc3, div.MsoToc3
	{margin-top:0in;
	margin-right:1.9pt;
	margin-bottom:0in;
	margin-left:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:9.0pt;
	font-family:"Times New Roman";}
p.MsoToc4, li.MsoToc4, div.MsoToc4
	{margin-top:0in;
	margin-right:.5in;
	margin-bottom:0in;
	margin-left:1.5in;
	margin-bottom:.0001pt;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoToc5, li.MsoToc5, div.MsoToc5
	{margin-top:0in;
	margin-right:.5in;
	margin-bottom:0in;
	margin-left:1.75in;
	margin-bottom:.0001pt;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoToc6, li.MsoToc6, div.MsoToc6
	{margin-top:0in;
	margin-right:.5in;
	margin-bottom:0in;
	margin-left:1.0in;
	margin-bottom:.0001pt;
	text-indent:-.5in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoToc7, li.MsoToc7, div.MsoToc7
	{margin-top:0in;
	margin-right:.5in;
	margin-bottom:0in;
	margin-left:1.0in;
	margin-bottom:.0001pt;
	text-indent:-.5in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoToc8, li.MsoToc8, div.MsoToc8
	{margin-top:0in;
	margin-right:.5in;
	margin-bottom:0in;
	margin-left:1.0in;
	margin-bottom:.0001pt;
	text-indent:-.5in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoToc9, li.MsoToc9, div.MsoToc9
	{margin-top:0in;
	margin-right:.5in;
	margin-bottom:0in;
	margin-left:1.0in;
	margin-bottom:.0001pt;
	text-indent:-.5in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoNormalIndent, li.MsoNormalIndent, div.MsoNormalIndent
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:.5in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoFootnoteText, li.MsoFootnoteText, div.MsoFootnoteText
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.25in;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:9.0pt;
	font-family:"Times New Roman";}
p.MsoCommentText, li.MsoCommentText, div.MsoCommentText
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.MsoHeader, li.MsoHeader, div.MsoHeader
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoFooter, li.MsoFooter, div.MsoFooter
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoIndexHeading, li.MsoIndexHeading, div.MsoIndexHeading
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.MsoCaption, li.MsoCaption, div.MsoCaption
	{margin:0in;
	margin-bottom:.0001pt;
	text-indent:.5in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
span.MsoFootnoteReference
	{vertical-align:super;}
p.MsoEndnoteText, li.MsoEndnoteText, div.MsoEndnoteText
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.MsoToa, li.MsoToa, div.MsoToa
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.2in;
	text-indent:-.2in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoMacroText, li.MsoMacroText, div.MsoMacroText
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Courier New";}
p.MsoToaHeading, li.MsoToaHeading, div.MsoToaHeading
	{margin-top:6.0pt;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.MsoListBullet, li.MsoListBullet, div.MsoListBullet
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.5in;
	text-indent:-.5in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.MsoListNumber, li.MsoListNumber, div.MsoListNumber
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:.25in;
	margin-bottom:.0001pt;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoListBullet2, li.MsoListBullet2, div.MsoListBullet2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:.5in;
	margin-bottom:.0001pt;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoListBullet3, li.MsoListBullet3, div.MsoListBullet3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:.75in;
	margin-bottom:.0001pt;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoListBullet4, li.MsoListBullet4, div.MsoListBullet4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:1.0in;
	margin-bottom:.0001pt;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoListBullet5, li.MsoListBullet5, div.MsoListBullet5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:1.25in;
	margin-bottom:.0001pt;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoListNumber2, li.MsoListNumber2, div.MsoListNumber2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:1.0in;
	text-indent:-.5in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.MsoListNumber3, li.MsoListNumber3, div.MsoListNumber3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:1.5in;
	text-indent:-.5in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.MsoListNumber4, li.MsoListNumber4, div.MsoListNumber4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:2.0in;
	text-indent:-.5in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.MsoListNumber5, li.MsoListNumber5, div.MsoListNumber5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:2.5in;
	text-indent:-.5in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.MsoTitle, li.MsoTitle, div.MsoTitle
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.MsoSignature, li.MsoSignature, div.MsoSignature
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:3.0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoBodyText, li.MsoBodyText, div.MsoBodyText
	{margin:0in;
	margin-bottom:.0001pt;
	text-align:center;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.MsoBodyTextIndent, li.MsoBodyTextIndent, div.MsoBodyTextIndent
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:.25in;
	margin-bottom:.0001pt;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:9.0pt;
	font-family:"Times New Roman";}
p.MsoSubtitle, li.MsoSubtitle, div.MsoSubtitle
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoDate, li.MsoDate, div.MsoDate
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoBodyTextFirstIndent, li.MsoBodyTextFirstIndent, div.MsoBodyTextFirstIndent
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-indent:.5in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.MsoBodyTextFirstIndent2, li.MsoBodyTextFirstIndent2, div.MsoBodyTextFirstIndent2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:.25in;
	text-indent:10.5pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoBodyText2, li.MsoBodyText2, div.MsoBodyText2
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:8.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
p.MsoBodyText3, li.MsoBodyText3, div.MsoBodyText3
	{margin:0in;
	margin-bottom:.0001pt;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
p.MsoBodyTextIndent2, li.MsoBodyTextIndent2, div.MsoBodyTextIndent2
	{margin:0in;
	margin-bottom:.0001pt;
	text-indent:.6in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoBodyTextIndent3, li.MsoBodyTextIndent3, div.MsoBodyTextIndent3
	{margin:0in;
	margin-bottom:.0001pt;
	text-indent:.3in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.MsoBlockText, li.MsoBlockText, div.MsoBlockText
	{margin-top:0in;
	margin-right:6.5pt;
	margin-bottom:0in;
	margin-left:22.5pt;
	margin-bottom:.0001pt;
	text-indent:-22.5pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:9.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
a:link, span.MsoHyperlink
	{color:blue;
	text-decoration:underline;}
a:visited, span.MsoHyperlinkFollowed
	{color:purple;
	text-decoration:underline;}
p.MsoDocumentMap, li.MsoDocumentMap, div.MsoDocumentMap
	{margin:0in;
	margin-bottom:.0001pt;
	background:navy;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:Tahoma;}
p.MsoAutoSig, li.MsoAutoSig, div.MsoAutoSig
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p
	{margin-top:5.0pt;
	margin-right:0in;
	margin-bottom:5.0pt;
	margin-left:0in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:12.0pt;
	font-family:"Arial Unicode MS";}
p.MsoCommentSubject, li.MsoCommentSubject, div.MsoCommentSubject
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.MsoAcetate, li.MsoAcetate, div.MsoAcetate
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:8.0pt;
	font-family:Tahoma;}
span.DeltaViewChangeNumber
	{color:black;
	letter-spacing:0pt;
	vertical-align:super;}
span.DeltaViewDelimiter
	{letter-spacing:0pt;}
p.alpha2, li.alpha2, div.alpha2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:62.35pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Body, li.Body, div.Body
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:21.25pt;
	text-align:justify;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Bullet1, li.Bullet1, div.Bullet1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:0in;
	text-align:justify;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Head, li.Head, div.Head
	{margin-top:14.75pt;
	margin-right:0in;
	margin-bottom:8.75pt;
	margin-left:21.25pt;
	text-align:justify;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.TableText, li.TableText, div.TableText
	{margin-top:1.0pt;
	margin-right:0in;
	margin-bottom:1.0pt;
	margin-left:0in;
	text-align:justify;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Alpha3-a, li.Alpha3-a, div.Alpha3-a
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:92.15pt;
	text-align:justify;
	text-indent:-42.55pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Alpha4-a, li.Alpha4-a, div.Alpha4-a
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:113.4pt;
	text-align:justify;
	text-indent:-21.25pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Level4, li.Level4, div.Level4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:113.4pt;
	text-align:justify;
	text-indent:-21.25pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Level5, li.Level5, div.Level5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:134.65pt;
	text-align:justify;
	text-indent:-21.25pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Head1, li.Head1, div.Head1
	{margin:0in;
	margin-bottom:.0001pt;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.Body1, li.Body1, div.Body1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:21.25pt;
	text-align:justify;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Body2, li.Body2, div.Body2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Head3, li.Head3, div.Head3
	{margin:0in;
	margin-bottom:.0001pt;
	text-align:justify;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman Bold";
	font-weight:bold;}
p.Body3, li.Body3, div.Body3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:92.15pt;
	text-align:justify;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Level1, li.Level1, div.Level1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:21.25pt;
	text-align:justify;
	text-indent:-21.25pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Level2, li.Level2, div.Level2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Level3, li.Level3, div.Level3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:92.15pt;
	text-align:justify;
	text-indent:-42.55pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Level6, li.Level6, div.Level6
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:4.0pt;
	margin-left:155.95pt;
	text-align:justify;
	text-indent:-21.3pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Roman2-i, li.Roman2-i, div.Roman2-i
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Roman3-i, li.Roman3-i, div.Roman3-i
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:92.15pt;
	text-align:justify;
	text-indent:-42.55pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Roman4-i, li.Roman4-i, div.Roman4-i
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:113.4pt;
	text-align:justify;
	text-indent:-21.25pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Alpha3-A0, li.Alpha3-A0, div.Alpha3-A0
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:92.15pt;
	text-align:justify;
	text-indent:-42.55pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Alpha5-a, li.Alpha5-a, div.Alpha5-a
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:134.65pt;
	text-align:justify;
	text-indent:-21.25pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Alpha2-a, li.Alpha2-a, div.Alpha2-a
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Alpha2-A0, li.Alpha2-A0, div.Alpha2-A0
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Alpha2-abolditalic, li.Alpha2-abolditalic, div.Alpha2-abolditalic
	{margin-top:6.0pt;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-indent:-28.35pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.5pt;
	font-family:"Times New Roman";
	font-weight:bold;
	font-style:italic;}
p.Alpha2-aitalic, li.Alpha2-aitalic, div.Alpha2-aitalic
	{margin-top:6.0pt;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
p.Alpha2-Abolditalic0, li.Alpha2-Abolditalic0, div.Alpha2-Abolditalic0
	{margin-top:6.0pt;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-indent:-28.35pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.5pt;
	font-family:"Times New Roman";
	font-weight:bold;
	font-style:italic;}
p.Alpha2-Abold, li.Alpha2-Abold, div.Alpha2-Abold
	{margin-top:6.0pt;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-indent:-28.35pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.5pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.Alpha2-Aitalic0, li.Alpha2-Aitalic0, div.Alpha2-Aitalic0
	{margin-top:6.0pt;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
p.Arabic2-1, li.Arabic2-1, div.Arabic2-1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Arabic3-1, li.Arabic3-1, div.Arabic3-1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:92.15pt;
	text-align:justify;
	text-indent:-42.55pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Arabic2-10, li.Arabic2-10, div.Arabic2-10
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Arabic3-10, li.Arabic3-10, div.Arabic3-10
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:92.15pt;
	text-align:justify;
	text-indent:-42.55pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Roman2-I0, li.Roman2-I0, div.Roman2-I0
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Roman2-I1, li.Roman2-I1, div.Roman2-I1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Alpha2-abold0, li.Alpha2-abold0, div.Alpha2-abold0
	{margin-top:6.0pt;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:49.6pt;
	text-indent:-28.35pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.5pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.Alpha1G-Aitalic, li.Alpha1G-Aitalic, div.Alpha1G-Aitalic
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:42.55pt;
	text-align:justify;
	text-indent:-42.55pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
p.Head2, li.Head2, div.Head2
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman Bold";
	font-weight:bold;}
p.Arabic4-1, li.Arabic4-1, div.Arabic4-1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:113.4pt;
	text-align:justify;
	text-indent:-21.25pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Arabic4-10, li.Arabic4-10, div.Arabic4-10
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:113.4pt;
	text-align:justify;
	text-indent:-21.25pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.alpha3, li.alpha3, div.alpha3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:96.4pt;
	text-align:justify;
	text-indent:-34.05pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Bullet2, li.Bullet2, div.Bullet2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:62.35pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Bullet3, li.Bullet3, div.Bullet3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:102.05pt;
	text-align:justify;
	text-indent:-39.7pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.CellBody, li.CellBody, div.CellBody
	{margin-top:2.0pt;
	margin-right:0in;
	margin-bottom:2.0pt;
	margin-left:0in;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.Title10C, li.Title10C, div.Title10C
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:center;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.CellHead, li.CellHead, div.CellHead
	{margin-top:2.0pt;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:0in;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
span.DeltaViewInsertion
	{font-weight:bold;
	text-decoration:underline;}
p.DoubleSpace, li.DoubleSpace, div.DoubleSpace
	{margin:0in;
	margin-bottom:.0001pt;
	line-height:200%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:12.0pt;
	font-family:"Times New Roman";}
span.DeltaViewDeletion
	{color:red;
	text-decoration:line-through;}
p.WGLAddressHeading, li.WGLAddressHeading, div.WGLAddressHeading
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.ListBullet2, li.ListBullet2, div.ListBullet2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.25in;
	text-align:justify;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.table, li.table, div.table
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:4.0pt;
	margin-left:0in;
	line-height:14.0pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:8.0pt;
	font-family:Arial;}
p.Style1, li.Style1, div.Style1
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	text-transform:uppercase;}
p.DoubleScore, li.DoubleScore, div.DoubleScore
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	border:none;
	padding:0in;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.BodytextBold, li.BodytextBold, div.BodytextBold
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.TableHeading1, li.TableHeading1, div.TableHeading1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:0in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:9.0pt;
	font-family:Arial;
	font-weight:bold;}
p.Address, li.Address, div.Address
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:1.0in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.BodyTextFirstInd2, li.BodyTextFirstInd2, div.BodyTextFirstInd2
	{margin:0in;
	margin-bottom:.0001pt;
	text-indent:1.0in;
	line-height:200%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.BodyTextHang, li.BodyTextHang, div.BodyTextHang
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.5in;
	text-indent:-.5in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.BodyTextHang2, li.BodyTextHang2, div.BodyTextHang2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:.5in;
	margin-bottom:.0001pt;
	text-indent:-.5in;
	line-height:200%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.Bullet, li.Bullet, div.Bullet
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.25in;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.CenterBold, li.CenterBold, div.CenterBold
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman Bold";
	font-weight:bold;}
p.CenterBoldScore, li.CenterBoldScore, div.CenterBoldScore
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman Bold";
	font-weight:bold;
	text-decoration:underline;}
p.CenterScore, li.CenterScore, div.CenterScore
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	text-decoration:underline;}
p.Heading, li.Heading, div.Heading
	{margin-top:6.0pt;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.LeftBold, li.LeftBold, div.LeftBold
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman Bold";}
p.LeftItalic, li.LeftItalic, div.LeftItalic
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.25in;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
p.LeftBoldItalic, li.LeftBoldItalic, div.LeftBoldItalic
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
p.NotesSeparator, li.NotesSeparator, div.NotesSeparator
	{margin-top:0in;
	margin-right:5.5in;
	margin-bottom:0in;
	margin-left:0in;
	margin-bottom:.0001pt;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	border:none;
	padding:0in;
	font-size:6.0pt;
	font-family:"Times New Roman";}
p.Quote, li.Quote, div.Quote
	{margin-top:0in;
	margin-right:1.0in;
	margin-bottom:12.0pt;
	margin-left:1.0in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.Separator, li.Separator, div.Separator
	{margin-top:0in;
	margin-right:207.35pt;
	margin-bottom:3.0pt;
	margin-left:207.35pt;
	punctuation-wrap:simple;
	text-autospace:none;
	border:none;
	padding:0in;
	font-size:1.5pt;
	font-family:"Times New Roman";}
p.SingleScore, li.SingleScore, div.SingleScore
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	border:none;
	padding:0in;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.TableHead, li.TableHead, div.TableHead
	{margin:0in;
	margin-bottom:.0001pt;
	text-align:center;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:8.0pt;
	font-family:"Times New Roman Bold";
	font-weight:bold;}
p.TableNotes, li.TableNotes, div.TableNotes
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:.25in;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:8.0pt;
	font-family:"Times New Roman";}
p.PageNum, li.PageNum, div.PageNum
	{margin:0in;
	margin-bottom:.0001pt;
	text-align:center;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.LeftScore, li.LeftScore, div.LeftScore
	{margin:0in;
	margin-bottom:.0001pt;
	line-height:200%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	text-decoration:underline;}
p.text2, li.text2, div.text2
	{margin:0in;
	margin-bottom:.0001pt;
	text-indent:.5in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.Head10, li.Head10, div.Head10
	{margin:0in;
	margin-bottom:.0001pt;
	text-align:center;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman Bold";
	font-weight:bold;}
p.Head5, li.Head5, div.Head5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-align:justify;
	line-height:13.0pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
p.Bodytext, li.Bodytext, div.Bodytext
	{margin:0in;
	margin-bottom:.0001pt;
	text-indent:.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.alpha1, li.alpha1, div.alpha1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:28.35pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Lista, li.Lista, div.Lista
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.25in;
	text-indent:-.25in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.Head4, li.Head4, div.Head4
	{margin:0in;
	margin-bottom:.0001pt;
	text-align:justify;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.Note-Head, li.Note-Head, div.Note-Head
	{margin-top:24.0pt;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.25in;
	text-indent:-.25in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	border:none;
	padding:0in;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.Note-BodyNo, li.Note-BodyNo, div.Note-BodyNo
	{margin-top:6.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:0in;
	text-align:justify;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.CaptionText, li.CaptionText, div.CaptionText
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.n, li.n, div.n
	{margin:0in;
	margin-bottom:.0001pt;
	text-indent:.5in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.SchedHead1, li.SchedHead1, div.SchedHead1
	{margin-top:7.0pt;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:28.35pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:Arial;
	font-weight:bold;}
p.23BodyText, li.23BodyText, div.23BodyText
	{margin-top:5.0pt;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:0in;
	margin-bottom:.0001pt;
	text-align:justify;
	line-height:110%;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:10.0pt;
	font-family:Arial;
	color:black;}
p.alpha4, li.alpha4, div.alpha4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:136.1pt;
	text-align:justify;
	text-indent:-34.05pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.alpha5, li.alpha5, div.alpha5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:164.45pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.alpha6, li.alpha6, div.alpha6
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:198.45pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Bullet4, li.Bullet4, div.Bullet4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:136.05pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Bullet5, li.Bullet5, div.Bullet5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:164.45pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Bullet6, li.Bullet6, div.Bullet6
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:198.45pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Parties, li.Parties, div.Parties
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:28.35pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Recitals, li.Recitals, div.Recitals
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:28.35pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.roman1, li.roman1, div.roman1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:28.35pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.roman2, li.roman2, div.roman2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:62.35pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.roman3, li.roman3, div.roman3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:102.05pt;
	text-align:justify;
	text-indent:-39.7pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.roman4, li.roman4, div.roman4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:136.05pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.roman5, li.roman5, div.roman5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:164.45pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.roman6, li.roman6, div.roman6
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:198.45pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Schedule1, li.Schedule1, div.Schedule1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:28.35pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Schedule2, li.Schedule2, div.Schedule2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:62.35pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Schedule3, li.Schedule3, div.Schedule3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:102.05pt;
	text-align:justify;
	text-indent:-39.7pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Schedule4, li.Schedule4, div.Schedule4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:136.1pt;
	text-align:justify;
	text-indent:-34.05pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Body4, li.Body4, div.Body4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:136.1pt;
	text-align:justify;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Schedule5, li.Schedule5, div.Schedule5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:164.45pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Body5, li.Body5, div.Body5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:164.45pt;
	text-align:justify;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Schedule6, li.Schedule6, div.Schedule6
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:198.45pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Body6, li.Body6, div.Body6
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:198.45pt;
	text-align:justify;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.TCLevel1, li.TCLevel1, div.TCLevel1
	{margin-top:7.0pt;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:28.35pt;
	margin-bottom:.0001pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;
	font-weight:bold;}
p.TCLevel2, li.TCLevel2, div.TCLevel2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:62.35pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.TCLevel3, li.TCLevel3, div.TCLevel3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:102.05pt;
	text-align:justify;
	text-indent:-39.7pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.TCLevel4, li.TCLevel4, div.TCLevel4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:136.05pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.BulletF, li.BulletF, div.BulletF
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:70.9pt;
	margin-bottom:.0001pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Table1, li.Table1, div.Table1
	{margin-top:3.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Table2, li.Table2, div.Table2
	{margin-top:3.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Table3, li.Table3, div.Table3
	{margin-top:3.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Table4, li.Table4, div.Table4
	{margin-top:3.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Table5, li.Table5, div.Table5
	{margin-top:3.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Table6, li.Table6, div.Table6
	{margin-top:3.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Tablealpha, li.Tablealpha, div.Tablealpha
	{margin-top:3.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Tableroman, li.Tableroman, div.Tableroman
	{margin-top:3.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.Tablebullet, li.Tablebullet, div.Tablebullet
	{margin-top:3.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.SchedPara1, li.SchedPara1, div.SchedPara1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:28.35pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.SchedPara2, li.SchedPara2, div.SchedPara2
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:28.35pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.SchedPara3, li.SchedPara3, div.SchedPara3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:62.35pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.SchedPara4, li.SchedPara4, div.SchedPara4
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:96.4pt;
	text-align:justify;
	text-indent:-34.05pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.SchedPara5, li.SchedPara5, div.SchedPara5
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:124.75pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.SchedPara6, li.SchedPara6, div.SchedPara6
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:7.0pt;
	margin-left:158.75pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.SchedHead2, li.SchedHead2, div.SchedHead2
	{margin-top:7.0pt;
	margin-right:0in;
	margin-bottom:3.0pt;
	margin-left:28.35pt;
	text-align:justify;
	text-indent:-28.35pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.5pt;
	font-family:Arial;
	font-weight:bold;}
p.SchedHead3, li.SchedHead3, div.SchedHead3
	{margin-top:7.0pt;
	margin-right:0in;
	margin-bottom:2.0pt;
	margin-left:62.35pt;
	text-align:justify;
	text-indent:-34.0pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;
	font-weight:bold;}
span.Checkbox
	{font-family:"Times New Roman";
	letter-spacing:0pt;}
p.text, li.text, div.text
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:10.0pt;
	margin-left:0in;
	text-align:justify;
	line-height:14.0pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.MDAListBullet, li.MDAListBullet, div.MDAListBullet
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:6.0pt;
	margin-left:63.35pt;
	text-indent:-27.35pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.OCBodytext, li.OCBodytext, div.OCBodytext
	{margin:0in;
	margin-bottom:.0001pt;
	text-indent:.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.BulletedList, li.BulletedList, div.BulletedList
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:63.35pt;
	margin-bottom:.0001pt;
	text-indent:-27.35pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";}
p.SignatureBlock, li.SignatureBlock, div.SignatureBlock
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:3.0in;
	margin-bottom:.0001pt;
	text-indent:.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.UnderlineHeading, li.UnderlineHeading, div.UnderlineHeading
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-indent:.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:12.0pt;
	font-family:"Times New Roman";
	text-decoration:underline;}
p.Default1, li.Default1, div.Default1
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.5in;
	text-indent:-.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.TitleL, li.TitleL, div.TitleL
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	text-indent:.25in;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:12.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.ItalicIndent, li.ItalicIndent, div.ItalicIndent
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:.25in;
	page-break-after:avoid;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-style:italic;}
span.DeltaViewMoveDestination
	{color:lime;
	text-decoration:underline;}
span.DeltaViewMoveSource
	{color:lime;
	text-decoration:line-through;}
p.Hearing3, li.Hearing3, div.Hearing3
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:11.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
p.38bTablestylenumericChar, li.38bTablestylenumericChar, div.38bTablestylenumericChar
	{margin-top:3.0pt;
	margin-right:.05in;
	margin-bottom:0in;
	margin-left:0in;
	margin-bottom:.0001pt;
	line-height:120%;
	page-break-after:avoid;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:9.0pt;
	font-family:Arial;
	color:black;}
p.24Chapterbullet1, li.24Chapterbullet1, div.24Chapterbullet1
	{margin-top:5.0pt;
	margin-right:0in;
	margin-bottom:1.0pt;
	margin-left:.25in;
	text-align:justify;
	text-indent:-.25in;
	line-height:110%;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:10.0pt;
	font-family:Arial;
	color:black;}
p.Style2, li.Style2, div.Style2
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.SecondHeading6, li.SecondHeading6, div.SecondHeading6
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:12.0pt;
	font-family:"Times New Roman";}
p.toc2, li.toc2, div.toc2
	{margin:0in;
	margin-bottom:.0001pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:9.0pt;
	font-family:"Times New Roman";}
p.000normal, li.000normal, div.000normal
	{margin-top:9.0pt;
	margin-right:0in;
	margin-bottom:5.0pt;
	margin-left:0in;
	text-align:justify;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:10.0pt;
	font-family:Arial;}
p.dpwwoobullet1l, li.dpwwoobullet1l, div.dpwwoobullet1l
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:10.0pt;
	margin-left:.75in;
	text-indent:-.25in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:10.0pt;
	font-family:Arial;}
p.dpwWoobdy, li.dpwWoobdy, div.dpwWoobdy
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:10.0pt;
	margin-left:0in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:10.0pt;
	font-family:Arial;}
p.dpwWoobullet1l0, li.dpwWoobullet1l0, div.dpwWoobullet1l0
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:10.0pt;
	margin-left:.5in;
	text-indent:-.25in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:10.0pt;
	font-family:Arial;}
p.dpwwoobdy0, li.dpwwoobdy0, div.dpwwoobdy0
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:10.0pt;
	margin-left:0in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:10.0pt;
	font-family:Arial;}
p.01parapoint, li.01parapoint, div.01parapoint
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:0in;
	margin-left:.7in;
	margin-bottom:.0001pt;
	text-indent:-.2in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:10.0pt;
	font-family:"Times New Roman";}
p.SecondHeading3, li.SecondHeading3, div.SecondHeading3
	{margin-top:0in;
	margin-right:0in;
	margin-bottom:12.0pt;
	margin-left:0in;
	punctuation-wrap:hanging;
	text-autospace:ideograph-numeric ideograph-other;
	font-size:12.0pt;
	font-family:"Times New Roman";}
span.cs-902-hidden1
	{color:green;}
p.BodyCopy, li.BodyCopy, div.BodyCopy
	{margin:0in;
	margin-bottom:.0001pt;
	text-align:justify;
	line-height:14.0pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:12.0pt;
	font-family:Times;}
p.CenteredHeading, li.CenteredHeading, div.CenteredHeading
	{margin:0in;
	margin-bottom:.0001pt;
	text-align:center;
	line-height:12.0pt;
	punctuation-wrap:simple;
	text-autospace:none;
	font-size:12.0pt;
	font-family:"Times New Roman";
	font-weight:bold;}
ins
	{text-decoration:none;}
span.msoIns
	{text-decoration:underline;}
span.msoDel
	{text-decoration:line-through;
	color:red;}
 /* Page Definitions */
 @page Section1
	{size:8.5in 11.0in;
	margin:.6in 1.0in .9in 1.0in;}
div.Section1
	{page:Section1;}
@page Section2
	{size:8.5in 11.0in;
	margin:.6in 1.0in .9in 1.0in;}
div.Section2
	{page:Section2;}
@page Section3
	{size:8.5in 11.0in;
	margin:.6in 1.0in .9in 76.5pt;}
div.Section3
	{page:Section3;}
@page Section4
	{size:8.5in 11.0in;
	margin:.6in 1.0in .9in 76.5pt;}
div.Section4
	{page:Section4;}
@page Section5
	{size:8.5in 11.0in;
	margin:.6in 67.5pt .9in 1.0in;}
div.Section5
	{page:Section5;}
 /* List Definitions */
 ol
	{margin-bottom:0in;}
ul
	{margin-bottom:0in;}
- -->

</head>

<body style='font-family:arial,helvetica,sans-serif;font-size:9pt'  bgcolor=silver lang=EN-US link=blue vlink=purple>

<div>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>UNITED STATES SECURITIES AND EXCHANGE COMMISSION</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Washington, DC 20549</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal' style="margin-top:0;margin-bottom:0">FORM 20-F</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.5in' style="margin-top:0;margin-bottom:0"><b>[  ]           </b><b>REGISTRATION STATEMENT PURSUANT TO SECTION 12(B) OF THE SECURITIES
EXCHANGE ACT OF 1934</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>OR</b></p>

<p align=center style='text-align:center;line-height:50%' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.5in;text-indent:-.5in' style="margin-top:0;margin-bottom:0"><b>[X]          ANNUAL REPORT PURSUANT TO SECTION 13 OR
15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 &#150; For the fiscal year ended
December 31, 2006</b></p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>OR</b></p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.5in;text-indent:-.5in' style="margin-top:0;margin-bottom:0"><b>[  ]           TRANSITION REPORT PURSUANT TO SECTION
13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 &#150; For the transition period
from _________ to _________</b></p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='margin-left:.5in;text-align:center;
text-indent:-.5in' style="margin-top:0;margin-bottom:0"><b>OR</b></p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.5in;text-indent:-.5in' style="margin-top:0;margin-bottom:0"><b>[  ]           SHELL COMPANY REPORT PURSUANT TO SECTION
13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 &#150; Date of event requiring
this shell company report __________</b></p>

<p align=center style='margin-left:.5in;text-align:center;
text-indent:-.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='margin-left:.5in;text-align:center;
text-indent:-.5in' style="margin-top:0;margin-bottom:0"><b>Commission file number
1-03006</b></p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Philippine Long Distance Telephone Company</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Exact name of Registrant as specified in its charter)</p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Republic of the Philippines</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Jurisdiction of incorporation or organization)</p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Ramon</b><b> Cojuangco Building</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Makati Avenue</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Makati City</b><b>,
 Philippines</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Address of principal executive offices)</p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Securities registered or to be registered pursuant to
Section 12(b) of the Act.</p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:3.0pt' style="margin-top:0;margin-bottom:0"><u>Title of each class</u></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Name of each exchange</p>
 <p align=center style='margin-bottom:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><u>on which registered</u></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:3.0pt;
 margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Common
 Capital Stock, Par Value Five Philippine Pesos Per Share</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">New York Stock Exchange*</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:3.0pt;
 margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">American
 Depositary Shares, evidenced by American Depositary Receipts, each
 representing one share of Common Capital Stock</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">New York Stock Exchange<br>
 <br>
 </p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>*    Registered on the New York Stock Exchange not for trading but only in connection with the registration of
American Depositary Shares pursuant to the requirements of such stock exchange</i>.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Securities registered or to be registered pursuant to
Section 12(g) of the Act.</p>

<p align=center style='text-align:center;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">None</p>

<p align=center style='text-align:center;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Securities for which there is a reporting obligation
pursuant to Section 15(d) of the Act.</p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align=center>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">10.500% Notes due 2009</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">11.375% Notes due 2012</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">8.350% Notes due 2017</p>
 </td>
 </tr>
</table></center></div>

</div>

<p style='text-indent:.5in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Indicate the number of
outstanding shares of each of the issuer&#146;s classes of capital or common stock
as at the close of the period covered by the annual report.</p>

<p style='margin-left:.5in;text-indent:-.5in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align=center>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">As at December 31, 2006:</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">188,434,695 shares of Common
 Capital Stock, Par Value Five Philippine Pesos Per Share</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">442,375,057 shares of Serial
 Preferred Stock, Par Value Ten Philippine Pesos Per Share</p>
 </td>
 </tr>
</table></center></div>

</div>

<p style='margin-left:.25in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the <br>
Securities Act:       Yes [&#8730;]      No [    ]</p>

<p style='margin-left:.25in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">If
this report is an annual or transition report, indicate by check mark if the
registrant is not required to file reports pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934:    Yes [   ]     No [&#8730;]</p>

<p style='margin-left:.25in;line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days:  Yes [<a name="OLE_LINK3"></a><a name="OLE_LINK2">&#8730;</a>]
No</p>

<p style='margin-left:.25in;line-height:50%' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filed.  See definition of &#147;accelerated
filer and large accelerated filer&#148; in Rule 12b-2 of the Exchange Act.</p>

<p style='margin-left:.25in;line-height:50%' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Large
Accelerated Filer [&#8730;]            Accelerated Filer [  ]
Non-Accelerated Filer [   ]</p>

<p style='margin-left:.25in;line-height:50%' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Indicate
by check mark which financial statement item the registrant has elected to
follow:  Item 17 [  ]   Item 18 [&#8730;]</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">If
this is an annual report, indicate by check mark whether the registrant is a
shell company (as defined in Rule 12b-2 of the Exchange Act):   Yes [   ]
No [&#8730;]</p>

</div>

<br clear=all
style='page-break-before:always'>

<div>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>TABLE OF CONTENTS</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:475.3pt;margin-left:18.9pt;border-collapse:collapse'>

 <tr style='height:.2in'>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>

 <tr style='height:13.5pt'>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:13.5pt'>
 <p style="margin-top:0;margin-bottom:0">CERTAIN CONVENTIONS AND TERMS
 USED IN THIS REPORT</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:13.5pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:13.5pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:13.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:4.5pt'>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.5pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.5pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.5pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:4.5pt'>
 <p align=center style='text-align:center;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">FORWARD-LOOKING STATEMENTS</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">PART I</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:12.15pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.15pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.15pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 1.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.15pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Identity
 of Directors, Senior Management and Advisors</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.15pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:11.25pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.25pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.25pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 2.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.25pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Offer
 Statistics and Expected Timetable</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.25pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 3.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Key
 Information</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:12.6pt' style="margin-top:0;margin-bottom:0">Selected
 Financial Data</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:12.6pt' style="margin-top:0;margin-bottom:0">Capital
 Stock</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:12.6pt' style="margin-top:0;margin-bottom:0">Dividends
 Declared</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:12.6pt' style="margin-top:0;margin-bottom:0">Dividends
 Paid</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:12.6pt' style="margin-top:0;margin-bottom:0">Exchange
 Rates</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:12.6pt' style="margin-top:0;margin-bottom:0">Risk
 Factors</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 4.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Information
 on the Company</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Overview</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Historical Background and
 Development</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Organization</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Strengths</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Strategy</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Business</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Infrastructure</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Interconnection Agreements</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Licenses and Regulation</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Competition</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Environmental Matters</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Intellectual Property Rights</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Properties</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 4A.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Unresolved
 Staff Comments</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 5.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Operating
 and Financial Review and Prospects</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Overview</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Critical Accounting Policies</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Results of Operations</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Liquidity and Capital
 Resources</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Impact of Inflation and
 Changing Prices</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 6.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Directors,
 Senior Management and Employees</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Directors, Key Officers and
 Advisors</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Terms of Office</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Family Relationships</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Compensation of Key Management
 Personnel of the PLDT Group</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Long-Term Incentive Plan</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Executive Stock Option Plan</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Share Ownership</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Board of Directors</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Audit, Nomination, Executive
 Compensation and Technology Strategy Committees</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Directors&#146; and Officers&#146; Involvement
 in Certain Legal Proceedings</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Employees and Labor Relations</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Pension and Retirement
 Benefits</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 7.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Major
 Shareholders and Related Party Transactions</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Related Party Transactions</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 8.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Financial
 Information</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Consolidated Statements and
 Other Financial Information</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Legal Proceedings</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Dividend Distribution Policy</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 9.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">The
 Offer and Listing</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Common Capital Stock and
 Amercian Depositary Shares (&#147;ADSs&#148;)</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:12.6pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.6pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.6pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 10.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.6pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Additional
 Information</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.6pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Articles of Incorporation and
 By-Laws</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Material Contracts</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Exchange Controls and Other
 Limitations Affecting Securities Holders</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Taxation</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Documents on Display</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 11.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Quantitative
 and Qualitative Disclosures About Market Risks</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Liquidity Risk Management</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Foreign Exchange Risk
 Management</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Interest Rate Risk Management</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 12.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Description
 of Securities Other than Equity Securities</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">PART II</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 13.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Defaults,
 Dividend Arrearages and Delinquencies</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 14.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Material
 Modifications to the Rights of Security Holders and Use of Proceeds</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 15.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Controls
 and Procedures</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 16A.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Audit
 Committee Financial Expert</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 16B.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Code
 of Business Conduct and Ethics</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 16C.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Principal
 Accountant Fees and Services</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 16D.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Exemption
 from the listing Standards for Audit Committees</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 16E.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Purchases
 of Equity Securities by the Issuer and Affiliated Purchaser</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:11.7pt'>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.7pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.7pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.7pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.7pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:11.7pt'>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">PART III</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 17.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Financial
 Statements</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 18.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Financial
 Statements</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Item
 19.</p>
 </td>
 <td  colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:5.4pt' style="margin-top:0;margin-bottom:0">Exhibits</p>
 </td>
 <td  colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.1in'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.1in'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.1in'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.1in'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:12.6pt'>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.6pt'>
 <p style="margin-top:0;margin-bottom:0">EXHIBIT INDEX</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.6pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.6pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:12.6pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:5.85pt'>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:5.85pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:5.85pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:5.85pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:5.85pt'>
 <p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:13.95pt'>
 <td  colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:13.95pt'>
 <p style="margin-top:0;margin-bottom:0">CERTIFICATION</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:13.95pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:13.95pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:13.95pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='text-indent:22.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:1.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<br clear=all
style='page-break-before:always'>

<div>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><a
name="_Toc170286130"></a><a name="_Toc75779184"></a><a name="_Toc46082243"></a><a
name="_CERTAIN_CONVENTIONS_AND_TERMS USED "></a><b>CERTAIN
CONVENTIONS AND TERMS USED IN THIS REPORT</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Unless
the context indicates or otherwise requires, references to &#147;we,&#148; &#147;us,&#148; &#147;our&#148; or
&#147;PLDT Group&#148; mean Philippine Long Distance Telephone Company and its
consolidated subsidiaries, and references to &#147;PLDT&#148; mean Philippine Long
Distance Telephone Company, not including its consolidated subsidiaries (see <i>Note
2 &#150;Basis of Consolidated Financial Statements Preparation </i>to the
accompanying consolidated financial statements in Item 18 for a list of these
subsidiaries, including a description of their respective principal business
activities).</p>

<p style='line-height:11.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Any
discrepancies in any table between totals and the sums of the amounts listed
are due to rounding.</p>

<p style='text-indent:.5in;line-height:11.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">All
references to the &#147;Philippines&#148; contained in this report mean the Republic of
the Philippines and all references to the &#147;U.S.&#148; or the &#147;United States&#148; are to the United States of America.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
this report, unless otherwise specified or the context otherwise requires, all
references to &#147;pesos,&#148; &#147;Philippine pesos&#148; or &#147;Php&#148; are to the lawful currency
of the Philippines, all references to &#147;dollars,&#148; &#147;U.S. dollars&#148; or &#147;US$&#148; are to
the lawful currency of the United States, all references to &#147;Japanese yen,&#148;
&#147;JP&yen;&#148; or &#147;&yen;&#148; are to the lawful currency of Japan, and all references to &#147;Euro&#148;
or &#147;&#128;&#148; are to the lawful currency of the European Union.  Unless otherwise
indicated, translations of peso amounts into U.S. dollars in this report were
made based on the volume weighted average exchange rate quoted through the
Philippine Dealing System, which was Php49.045 to US$1.00 on December 31, 2006.
On June 26, 2007, the volume weighted average exchange rate quoted was Php46.222
to US$1.00.</p>

<p style='text-indent:.5in;line-height:11.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
this report, each reference to:</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
ACeS Philippines means ACeS
Philippines Cellular Satellite Corporation, our wholly-owned subsidiary;</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
AIL means ACeS International
Limited, a 36.99%-owned associate of ACeS Philippines;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Airborne Access means Airborne
Access Corporation, a 51%-owned subsidiary of ePLDT;</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
ARPU means average monthly revenue
per user;</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;line-height:
94%' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
BCC or Bonifacio
Communications Corporation, our 75%-owned subsidiary;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
BSP means Bangko Sentral ng
Pilipinas;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
ClarkTel means PLDT Clark Telecom,
Inc., our wholly-owned subsidiary;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
CyMed means CyMed, Inc., a
wholly-owned subsidiary of SPi;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Digital Paradise means Digital
Paradise, Inc., a 75%-owned subsidiary of ePLDT;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
DoCoMo means NTT
DoCoMo, Inc.;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
DSL means digital subscriber line;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
ePLDT means ePLDT, Inc., our
wholly-owned subsidiary;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
ePLDT Ventus means the umbrella
brand name for ePLDT&#146;s call center business, including Ventus, Vocativ and
Parlance;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
First Pacific means First Pacific
Company Limited;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
First Pacific Group means First
Pacific and its Philippine and other affiliates;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
GAAP means generally accepted
accounting principles;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
GSM means global system for mobile
communications;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Infocom means Infocom
Technologies, Inc., a 99.6%-owned subsidiary of ePLDT;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Level Up! means Level Up!, Inc., a
60%-owned subsidiary of ePLDT;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Mabuhay Satellite means Mabuhay
Satellite Corporation, our 67%-owned subsidiary;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Maratel means PLDT-Maratel, Inc.,
our 97.5%-owned subsidiary;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
netGames means netGames, Inc., an 80%-owned
subsidiary of ePLDT;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
NTC means the National
Telecommunications Commission of the Philippines;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in !msorm;text-indent:.5in !msorm;
line-height:7.0pt !msorm;margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
NTT means Nippon Telegraph and
Telephone Corporation;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
NTT Communications means NTT
Communications Corporation, a wholly-owned subsidiary of Nippon Telegraph and
Telephone Corporation of Japan;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
NTTC-UK means NTT Communications
Capital (UK) Ltd., a wholly-owned subsidiary of NTT Communications;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
PAPTELCO means Philippine
Association of Private Telephone Companies, Inc.;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Parlance means Parlance Systems,
Inc., a wholly-owned subsidiary of ePLDT;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
PFRS means Philippine Financial
Reporting Standards;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Piltel means Pilipino Telephone
Corporation, a 92.1%-owned subsidiary of Smart; </p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
PLDT Beneficial Trust Fund means
the beneficial trust fund created by PLDT to pay the benefits under the PLDT
Employees&#146; Benefit Plan;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
PLDT Global means PLDT Global
Corporation, our wholly-owned subsidiary;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;line-height:
94%' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
SEC means the
Securities and Exchange Commission;</p>

<p style='text-indent:0in !msorm;line-height:94% !msorm;
text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;line-height:
94%' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
SIM means
subscriber identification module;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;line-height:
94%' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
SMS means short
messaging service;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Smart means Smart Communications,
Inc., our wholly-owned subsidiary;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Smart Broadband means Smart
Broadband, Inc. (formerly Meridian Telekoms, Inc.), our wireless broadband
provider and a wholly-owned subsidiary of Smart; </p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
SPi means SPi Technologies, Inc.,
a wholly-owned subsidiary of ePLDT;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
SubicTel means Subic Telecommunications
Company, Inc., our wholly-owned subsidiary;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Telesat means Telesat, Inc., our
94.4%-owned subsidiary;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
VAS means value-added service;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
VAT means value-added tax;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Ventus means ePLDT Ventus, Inc., a
wholly-owned subsidiary of ePLDT;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Vocativ means Vocativ Systems,
Inc., a wholly-owned subsidiary of ePLDT; </p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
VSAT means very small aperture
terminal; </p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
WAP means wireless application
protocol;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
W-CDMA means wireless-code
division multiple access; and</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Wolfpac means Wolfpac Mobile,
Inc., our wireless content operator and a wholly-owned subsidiary of Smart.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><a
name="_Toc170286131"></a><a name="_Toc75779185"></a><a name="_Toc46082244"></a><a
name="_FORWARD-LOOKING_STATEMENTS"></a><b>FORWARD-LOOKING
STATEMENTS</b></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Some
information in this report may contain forward-looking statements within the
meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and
Section 21E of the U.S. Securities Exchange Act of 1934, as amended.  We have
based these forward-looking statements on our current beliefs, expectations and
intentions as to facts, actions and events that will or may occur in the
future.  Such statements generally are identified by forward-looking words such
as &#147;believe,&#148; &#147;plan,&#148; &#147;anticipate,&#148; &#147;continue,&#148; &#147;estimate,&#148; &#147;expect,&#148; &#147;may,&#148;
&#147;will&#148; or other similar words.</p>

<p style='text-indent:.5in;line-height:11.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">A forward-looking statement may include a statement of
the assumptions or bases underlying the forward-looking statement.  We have
chosen these assumptions or bases in good faith.  These forward-looking statements are subject to risks, uncertainties
and assumptions, some of which are beyond our control.  In addition, these
forward-looking statements reflect our current views with respect to future
events and are not a guarantee of future performance.  Actual results may
differ materially from information contained in the forward-looking statements
as a result of a number of factors, including, without limitation, the risk
factors set forth in Item&nbsp;3. &#147;Key Information &#150;&#150; Risk Factors.&#148;  When considering forward-looking statements, you should keep
in mind the description of risks and other cautionary statements in this
report.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">You
should also keep in mind that any forward-looking statement made by us in this
report or elsewhere speaks only as at the date on which we made it.  New risks
and uncertainties come up from time to time, and it is impossible for us to
predict these events or how they may affect us.  We have no duty to, and do not
intend to, update or revise the statements in this report after the date
hereof.  In light of these risks and uncertainties, you should keep in mind
that actual results may differ materially from any forward-looking statement
made in this report or elsewhere.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><a name="_Toc75779186"></a><a name="_Toc46082245">&nbsp;</a></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><a
name="_Toc170286132"></a><a name="_PART_I"></a>PART I</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286133"></a><a name="_Toc75779187"></a><a
name="_Toc46082246"></a><a name="_Item_1._Identity_of Directors, Seni"></a><b>Item 1.       Identity of Directors, Senior Management
and Advisors</b></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Not applicable.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286134"></a><a name="_Toc75779188"></a><a
name="_Toc46082247"></a><a name="_Item_2._Offer_Statistics and Expect"></a><b>Item 2.       Offer Statistics and Expected Timetable</b></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Not
applicable.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286135"></a><a name="_Toc75779189"></a><a
name="_Toc46082248"></a><a name="_Item_3._Key_Information"></a><b>Item 3.       Key Information</b></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286136"></a><a name="_Toc75779190"></a><a
name="_Toc46082249"></a><a name="_Selected_Financial_Data"></a><b>Selected Financial Data</b></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
selected consolidated financial information below should be read in conjunction
with, and is qualified in its entirety by reference to, our consolidated
financial statements, including the notes, included elsewhere in this report.
The consolidated financial statements have been prepared and presented in
conformity with U.S. GAAP.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Prior
to the filing of our Annual Report on Form 20-F in respect of the year ended
December 31, 2002, the consolidated financial statements included in our Annual
Reports on Form 20-F filed with the U.S. Securities and Exchange Commission, or
U.S. SEC, were prepared in conformity with PFRS.  PFRS varies in certain
significant respects from U.S. GAAP.  A description of the significant
differences between U.S. GAAP and PFRS and a quantitative reconciliation of
such differences in the net loss and stockholders&#146; equity to U.S. GAAP was
disclosed in a note to our previously filed consolidated financial statements.</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=10 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <p align=center style='margin-right:8.65pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Consolidated Financial Data</b></p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=10 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <p align=center style='margin-right:8.65pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>

 <tr style='height:1.0pt'>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:.35pt'>
 <p align=center style='text-align:center;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:.35pt'>
 <p align=center style='text-align:center;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b>(1)</p>
 </div>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:.35pt'>
 <p align=center style='text-align:center;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:.35pt'>
 <p align=center style='text-align:center;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </div>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:.35pt'>
 <p align=center style='text-align:center;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0"><b>2003</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:.35pt'>
 <p align=center style='text-align:center;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0"><b>2002</b></p>
 </div>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=10 valign=top style=' padding:0in 5.5pt 0in 5.5pt;
 height:1.0pt'>
 <p align=center style='margin-left:8.0pt;text-align:center;
 text-indent:-8.0pt;line-height:97%' style="margin-top:0;margin-bottom:0">(in millions, except operating income per share, earnings per common
 share, ratio of earnings to fixed charges and dividends declared per common
 share)</p>
 </td>
 </tr>

 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0"><i>Amounts in conformity
 with U.S. GAAP:</i></p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0"><b>Statements of Operating
 Data:</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Operating Revenues </p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.05pt;text-align:right' style="margin-top:0;margin-bottom:0">Php127,536</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">US$2,600</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.0pt;text-align:right' style="margin-top:0;margin-bottom:0">Php123,335</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:7.85pt;text-align:right' style="margin-top:0;margin-bottom:0">Php121,173</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:7.5pt;text-align:right' style="margin-top:0;margin-bottom:0">Php111,200</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.5pt;text-align:right' style="margin-top:0;margin-bottom:0">Php93,831</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:7.9pt;text-indent:1.1pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">125,004</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">2,549</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">120,348</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">114,904</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">100,486</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">81,686</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:7.9pt;text-indent:1.1pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">2,532</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">2,987</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">6,269</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">10,714</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">12,145</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Operating Expenses</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">79,357</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">1,618</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">74,821</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">72,634</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">77,821</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">81,802</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Operating Income </p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">48,179</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">982</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">48,514</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">48,539</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">33,379</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">12,029</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Operating income per share</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:7.9pt;text-indent:1.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">253.95</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">5.18</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">263.81</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">266.73</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">179.04</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">55.47</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:7.9pt;text-indent:1.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">253.95</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">5.18</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">255.15</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">252.20</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">165.37</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">52.23</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Net income (loss)</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">33,598</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">685</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">11,045</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">(6,158)</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Earnings per common share(2)</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:7.9pt;text-indent:5.6pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">174.90</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">3.57</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">217.84</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">146.32</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">47.20</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">(52.08)</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:7.9pt;text-indent:5.6pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">174.90</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">3.57</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">211.93</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">145.30</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">45.72</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">(52.08)</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0"><b>Balance Sheets Data:</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Cash and cash equivalents</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">16,870</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">344</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">30,059</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">27,321</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">19,372</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">10,974</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Total assets</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">264,195</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">5,387</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">269,709</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">279,041</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">276,362</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">269,387</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Total long-term debt - net
 of current portion</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">69,542</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">1,418</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">93,516</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">131,377</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">160,464</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">171,283</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Total debt(3)</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">86,059</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">1,755</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">112,313</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">159,455</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">186,407</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">191,668</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Total liabilities(4)</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">154,607</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">3,152</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">176,980</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">215,145</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">236,630</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">240,622</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Total stockholders&#146; equity</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">106,173</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">2,165</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">79,595</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">48,079</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">24,746</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">16,413</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0"><b>Other Data:</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Depreciation and
 amortization </p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">28,130</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">574</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">27,855</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">20,098</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">21,812</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">17,566</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Ratio of earnings to fixed
 charges(5)</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">8.1x</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">8.1x</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">5.9x</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">4.1x</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">2.0x</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Net cash provided by
 operating activities</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">61,201</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">1,248</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">66,280</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">63,107</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">42,582</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">39,722</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Net cash used in investing
 activities</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">36,764</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">750</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">13,080</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">24,764</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">20,021</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">17,167</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Net cash used in financing
 activities</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">36,916</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">753</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">49,470</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">30,325</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">14,135</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">15,954</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Dividends declared to
 common shareholders</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">14,459</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">295</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">9,624</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:1.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p style='margin-left:8.0pt;text-indent:-8.0pt;line-height:
 97%' style="margin-top:0;margin-bottom:0">Dividends declared per common
 share</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">78.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">1.59</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">56.00</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.5pt 0in 5.5pt;height:1.0pt'>
 <p align=right style='margin-right:8.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">_____________</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>We maintain our accounts in
Philippine peso.  For convenience, the peso financial information as at and for
the year ended December 31, 2006, has been translated into U.S. dollars at the
exchange rate of Php49.045 to US$1.00, the rate quoted through the Philippine
Dealing System as at December 31, 2006.  This translation should not be
construed as a representation that the Philippine peso amounts represent, or
have been or could be converted into, U.S. dollars at that rate or any other
rate.</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(2)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>In 2006 and 2002, our
convertible preferred shares were deemed anti-dilutive based on a calculation
of the required dividends on preferred shares for each series of convertible
preferred shares divided by the number of equivalent common shares assuming
such preferred shares were converted into common shares and compared against
the basic earnings per share.  Since the amount of dividends on preferred
shares over the equivalent number of common shares were greater than the basic
earnings per share, the amounts for basic and diluted earnings per share are
the same.</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(3)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Total debt represents
current portion of long-term debt, long-term debt &#151; net of current portion and
notes payable.</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(4)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Total liabilities on a
consolidated basis represent the difference between total assets and minority
interest in consolidated subsidiaries, preferred stock subject to mandatory
redemption and stockholders&#146; equity.</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(5)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>For purposes of this ratio,
&#147;Earnings&#148; consist of income before provision for income tax (excluding PLDT&#146;s
share in undistributed income of less than 50% owned affiliates) and fixed
charges (excluding capitalized interest).  &#147;Fixed charges&#148; consist of interest
(including capitalized interest, discounts and other financing costs) on all
indebtedness, amortization of deferred financing costs and the estimated
financing component of rent expense (i.e., one-third of rent expense).</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>Due
to PLDT&#146;s net losses in 2002, the coverage ratio on a consolidated basis was
less than 1.0x in that year.  In order to achieve a coverage ratio of 1.0x, we
would have had to generate additional consolidated earnings of Php2,463 million
for  the year ended December 31, 2002.</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286137"></a><a name="_Toc75779191"></a><a
name="_Toc46082250"></a><a name="_Capital_Stock"></a><b>Capital Stock</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
following table summarizes PLDT&#146;s capital stock outstanding as at December 31,
2006, 2005 and 2004.</p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:11.25pt'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:11.25pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:11.25pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.5pt'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:10.5pt'>
 <p style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:10.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;height:10.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:10.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;height:10.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.15pt'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.15pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.15pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Serial Preferred Stock</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">10% Cumulative Convertible Preferred Stocks</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.15in'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">A
 to EE</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,064</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,073</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,091</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p style='margin-left:27.0pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Series III</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">46</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p style='margin-left:27.0pt;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Convertible Preferred Stocks Subject to Mandatory
 Redemption</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p style='margin-left:27.0pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Series V(1)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p style='margin-left:27.0pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Series VI(1)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">47</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.55pt'>
 <p style='margin-left:27.0pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Series VII(2)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Cumulative Non-convertible Redeemable Preferred Stock</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p style='margin-left:27.0pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Series IV</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">360</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">360</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">360</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.05pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:10.05pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.05pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,433</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.05pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.05pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,517</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.05pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.05pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php4,604</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Common Stock</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php942</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php904</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php851</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0"><a name="_Toc75779192"></a><a
name="_Toc46082251">___________</a></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(1)   Preferred stock subject to mandatory redemption
in 2008 (see Note 14 &#150; Preferred Stock Subject to Mandatory Redemption to the
accompanying consolidated financial statements in Item 18 for further
discussion).</i></p>

<p style='line-height:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(2)   All shares of the Series VII Convertibles
Preferred Stock were converted in 2006 (see Note 14 &#150; Preferred Stock Subject
to Mandatory Redemption to the accompanying consolidated financial statements
in Item 18 for further discussion).</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286138"></a><a name="_Dividends_Declared"></a><b>Dividends Declared</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The table sets forth dividend declarations on shares
of PLDT&#146;s common stock in 2006:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'><a name="_Hlk116790513"></a>
 <p style='margin-top:3.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Date</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Class</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Declaration </b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Record</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Payable</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Per Share</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=center style='margin-bottom:1.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Common Stock</b></p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 27, 2006</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 20, 2006</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 20, 2006</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php28.00</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">Php5,080</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">August 8, 2006</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">August 21, 2006</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">September 21, 2006</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">50.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">9,379</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
addition, on March 6, 2007, PLDT declared cash dividend of Php50 per share to
common shareholders of record as at March 20, 2007 which was paid on April 20,
2007.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
current policy is to declare and pay dividends taking into consideration the
interests of our shareholders as well as our working capital, capital
expenditures and debt servicing requirements.  Also taken into consideration
are our ability to meet loan covenant requirements and the required prior written
consents of certain creditors and preferred stockholders (for stock dividends),
under certain conditions, in the declaration and payment of dividends as
discussed in <i>Note 12 &#150; Interest-bearing Financial Liabilities </i>and <i>Note</i>
<i>15 &#150; Stockholders&#146; Equity</i> to the accompanying consolidated financial
statements in Item 18.  The retention of earnings is necessary to meet the
funding requirements of our business expansion and development programs.
Unappropriated retained earnings of PLDT include undistributed earnings
representing accumulated equity in the net earnings of our subsidiaries, which
are not available for distribution as dividends until received in the form of
dividends from such subsidiaries (see <i>Note 15 &#150; Stockholders&#146; Equity</i> to
the accompanying consolidated financial statements in Item 18).  Dividends are
generally paid in Philippine pesos.  In the case of shareholders residing
outside the Philippines, PLDT's transfer agent in Manila, which acts as the
dividend-disbursing agent, converts the peso dividends into U.S. dollars at the
prevailing exchange rates, and remits the dollar proceeds abroad, net of
withholding tax.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286139"></a><a name="_Toc75779193"></a><a
name="_Toc46082252"></a><a name="_Dividends_Paid"></a><b>Dividends Paid</b></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">A
summary of dividends paid per share of PLDT's common stock stated in both
Philippine peso and U.S. dollars follows:</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='height:8.65pt'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'><br
 clear=all style='page-break-before:always'>

 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In Philippine Peso</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In U.S. Dollars</b></p>
 </td>
 </tr>
 <tr style='height:9.75pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.75pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.75pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.75pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.75pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2002</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">2003</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.00</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">1.142</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2006 </p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">78.00</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">1.590</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p style='text-indent:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">April 20</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28.00</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">0.545</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p style='text-indent:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">September 21</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">50.00</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">0.998</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2007 (through April 20, 2007)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">50.00</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">1.051</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.5in;text-indent:-.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:27.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">(<i>Note</i>:   <i>Dividends on PLDT's common stock were
declared and paid in Philippine peso.  For the convenience of the reader, the
peso dividends are translated into U.S. dollars based on exchange rates on the
respective dates of dividend payments).</i></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286140"></a><a name="_Toc75779194"></a><a
name="_Toc46082253"></a><a name="_Exchange_Rates"></a><b>Exchange Rates</b></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
Philippine government does not administratively fix the exchange rate between
the Philippine peso and the U.S. dollar.  Since August 1, 1992, a market
average rate has been determined daily in inter-bank trading using the
Philippine Dealing System, known as the &#147;Philippine Dealing System Reference
Rate.&#148;  The Philippine Dealing System is a specialized off-floor direct dealing
service for the trading of Philippine pesos-U.S. dollars by member banks of the
Bankers Association of the Philippines and BSP, the central bank of the Philippines.  All members of the Bankers Association of the Philippines are required to
make their Philippine peso-U.S. dollar trades through this system, which was
established by Telerate Financial Information Network of Hong Kong.</p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
following shows the exchange rates between the Philippine peso and the U.S.
dollar, expressed in pesos per U.S. dollar, for the periods indicated, based on
the volume-weighted average exchange rate for each business day in each of the
periods presented:</p>

<p style='line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Year Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Period End</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Average</b><b>(1)</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>High</b><b>(2)</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Low</b><b>(3)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style="margin-top:0;margin-bottom:0">2002</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php53.254</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php51.583</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php49.336</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php53.841</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style="margin-top:0;margin-bottom:0">2003</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">55.586</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">54.215</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">52.021</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">55.767</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.341</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.044</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">55.142</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.443</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">53.062</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">55.085</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">53.062</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.321</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style="margin-top:0;margin-bottom:0">2006 </p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49.045</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">51.832</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">50.106</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">53.587</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style="margin-top:0;margin-bottom:0">2007 (through June 26, 2007)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">46.222</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">47.803</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">45.718</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49.156</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">_____________</p>

<p style='line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Source:  Philippine Dealing
System Reference Rate</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(1)   Simple average of exchange rates for the period.</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(2)   Highest exchange rate for the period.</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(3)   Lowest exchange rate for the period.</i></p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Month</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Period End</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Average</b><b>(1)</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>High</b><b>(2)</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.5pt 0in 5.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Low</b><b>(3)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">December</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">49.045</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">49.431</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">49.045</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">49.659</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">January</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.902</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.908</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.706</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">49.156</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">February</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.583</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.365</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.054</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.781</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">March</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.217</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.501</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.077</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.864</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">April</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">47.536</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">47.785</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">47.449</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">48.294</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">May</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">46.178</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">46.749</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">45.922</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">47.673</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">June
 (through June 26, 2007)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">46.222</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">46.130</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">45.718</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.5pt 0in 5.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">46.594</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">_________________</p>

<p style='line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Source:  Philippine Dealing
System Reference Rate</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(1)   Simple average of exchange rates for the month.</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(2)   Highest exchange rate for the month.</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(3)   Lowest exchange rate for the month.</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">This report contains conversions
of Philippine peso amounts into U.S. dollars for your convenience.  Unless
otherwise specified, these conversions were made at the exchange rate as at
December 31, 2006 of Php49.045 to US$1.00.  You should not assume that such
peso amounts represent such U.S. dollar amounts or could have been or could be
converted into U.S. dollars at the rate indicated, or at any particular rate.
As at June 26, 2007, the exchange rate quoted through the Philippine Dealing
System was Php46.222 to US$1.00.</p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:8.0pt' style="margin-top:0;margin-bottom:0"><a
name="_Toc43040184">&nbsp;</a></p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK30"></a><a name="OLE_LINK29"></a><a
name="_Toc170286141"></a><a name="_Toc75779195"></a><a name="_Toc46082254"></a><a
name="_Toc42934525"></a><a name="_Risk_Factors"></a><b>Risk Factors</b><b> </b></p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Risks Relating to Us</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>We face competition from well-established
telecommunications operators and may face competition from new entrants that
may adversely affect our business, results of operations, financial condition
and prospects</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The Philippine government has liberalized the Philippine
telecommunications industry and opened up the Philippine telecommunications
market to new entrants.  Including the PLDT Group, there are nine major local
exchange carriers, seven international gateway facility providers and five
cellular service providers in the country.  Many new entrants into the
Philippine telecommunications market have entered into strategic alliances with
foreign telecommunications companies, which provide them access to
technological and funding support as well as service innovations and marketing
strategies.  Consequently, we are facing increasing competition in major
segments of the telecommunications industry, particularly data and other
network services segments.  We cannot assure you that the
number of providers of telecommunication services will not further increase or
that competition for telecommunications customers will not lead our cellular and
fixed line subscribers to switch to other operators or lead us to increase our marketing
expenditures or reduce our rates, resulting in a reduction in our
profitability.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Competition in the cellular telecommunications industry in the Philippines is based primarily on factors such as network coverage, quality of service and
price.  Recently, competition has increased as operators sought to develop and
maintain market share and to attract new subscribers.  Our principal cellular
competitors, Globe Telecom, Inc., or Globe, and Digital Telecommunications
Philippines, Inc., or Digitel, have introduced aggressive marketing campaigns
and promotions.  In addition, the government may allocate additional
frequencies and award additional cellular telecommunications licenses in the
future which could lead to increased competition.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">As a result of the
competitive environment, Smart has not increased its cellular rates since
November 1998.  Moreover, the level of competition requires Smart to
continuously innovate its products and to conduct promotions, which may affect
its cellular revenues and revenue growth.  For example, in order to test the
market demand for fixed rate or &#147;bucket&#148; plans for voice and text services and
in response to similar types of promotions launched by its competitors, Smart
launched, in March 2005, the <i>Smart
258 </i><i>Unlimited
Call </i>and<i>
Text promotions </i>pursuant to which Smart and <i>Talk &#145;N Tex</i>t prepaid
subscribers had the option to avail themselves of unlimited on-network
(Smart-to-Smart) voice calls or unlimited on-network (Smart-to-Smart) text
messages at a fixed rate. </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">There can be no
assurance that incurring additional marketing expenses for these promotions and
responding to rate pressures and the potential loss of customers will not have
a material adverse effect on our financial performance.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Rapid changes in telecommunications technology may
adversely affect the economics of our existing businesses and the value of our
assets, increase our required capital expenditures and create new competition</h5>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
telecommunications sector has been characterized recently by rapid
technological changes.  We cannot assure you that these developments will not
result in competition from providers of new services or the need to make
substantial capital expenditures to upgrade our facilities.  Furthermore, the
NTC has issued to Smart and our competitors the license covering 3G cellular
services, and we have incurred significant expenses in the roll out of these
services.  We are also continuing to upgrade to a next generation, all-IP
network and rolling out a wireless broadband network in order to expand our capability
to provide broadband services.  These projects will require significant capital
expenditures over the next few years.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our future success will depend, in part, on our ability
to anticipate or adapt to such changes and to offer services that meet customer
demands on a competitive and timely basis.  We may be unable to obtain new
technologies on a timely basis or on satisfactory terms or implement them in an
appropriate or effective manner.  Future development of new technologies,
services or standards could require significant changes to our business model
which could necessitate new investments.  In addition, new products and
services may be expensive to develop and may result in increased competition.
Such strategic initiatives and technological developments could require us to
incur significant additional capital expenditures.  There can be no assurance
that we would be able to adopt and successfully implement new technologies.  In
addition, there can be no assurance on how emerging and future technological
changes will affect our operations or the competitiveness of our services.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>Our results of operations
have been, and may continue to be, adversely affected by competition in
international long distance service</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
international long distance business has historically been one of our major
sources of revenue.  However, due to competition and the steep decline in
international settlement rates that are paid to us by foreign
telecommunications carriers for termination of international calls on our
network, revenues generated from our international long distance business have
overall declined in recent years.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
anticipate that revenues from international long distance and international
data services, including our services, will continue to decline in the future,
due primarily to:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
increased
competition from other domestic and international telecommunications providers;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
advances in
technology;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:.75in;margin-bottom:.0001pt;text-align:left;
text-indent:-.25in;page-break-after:auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
alternative
providers offering Internet telephony, also known as Voice over Internet Protocol,
or VoIP, and broadband capacity; and </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:.75in;margin-bottom:.0001pt;text-align:left;
text-indent:-.25in;page-break-after:auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
unauthorized
traffic termination and bypass routings by international simple resale
operators.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
cannot assure you that these declines will not materially and adversely affect
our financial performance.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Net
settlement payments between PLDT and other foreign telecommunications carriers
for origination and termination of international call traffic between the Philippines and other countries have been our predominant source of foreign currency
revenues.  However, in U.S. dollar terms, these payments have been declining in
recent years.  A continued decline in our foreign currency revenues could
increase our exposure to risks from declines in the value of the Philippine
peso against the U.S. dollar.  We cannot assure you that we will be able to
achieve adequate increases in our other revenues to make up for any adverse
impact of a further decline in our net settlement payments.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Our debt instruments contain restrictive covenants which require us to
maintain certain financial tests and our substantial indebtedness could impair
our ability to fulfill our financial obligations, service our other debt and
carry out new financings or pay dividends</i></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">As at December 31, 2006, we had
consolidated total indebtedness of approximately Php86,059 million (US$1,755
million), and a consolidated ratio of debt to equity (total debt on a
consolidated basis divided by total equity) of 0.79x.  Our existing debt instruments
contain covenants which, among other things, require PLDT to maintain certain
financial ratios calculated on the basis of PFRS on a consolidated and
non-consolidated basis, limit our ability to incur indebtedness, make
investments and pay dividends.  Financial statements prepared in conformity
with PFRS differ in some material respects from financial statements prepared
in conformity with U.S. GAAP.  For a description of some of these covenants,
see Item 5. &#147;Operating and Financial Review and Prospects &#151; Liquidity and
Capital Resources &#151; Financing Activities &#151; Debt Financing &#151; Debt Covenants.&#148;</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our substantial indebtedness and the requirements and
limitations imposed by our debt covenants could have important consequences.
For example, they could:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:.75in;margin-bottom:.0001pt;text-align:left;
text-indent:-.25in;page-break-after:auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
require us to
dedicate a substantial portion of our cash flow to payments on our
indebtedness, thereby reducing the availability of our cash flow to fund
working capital, capital expenditures and other general corporate requirements;
and</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
limit the
availability and amount of dividend payments to our common shareholders.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
principal factors that can negatively affect our ability to comply with the
financial ratios and other financial tests under our debt instruments are
depreciation of the Philippine peso relative to the U.S. dollar, poor operating
performance of PLDT and our consolidated subsidiaries, impairment or similar
charges in respect of investments or other long-lived assets that may be
recognized by PLDT and its consolidated subsidiaries and increases in our
interest expenses.  Since approximately 96% of our total consolidated debts
were denominated in foreign currencies, principally in U.S. dollars, many of
these financial ratios and other tests are negatively affected by any weakening
of the peso.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
peso has been subject to significant fluctuations in recent years.  From 2002
to 2004, the peso has generally been depreciating from a high of Php49.336 on
May 20, 2002 to a low of Php56.443 on October 14, 2004.  In 2005, the peso
fluctuated significantly from a low of Php56.321 on July 8, 2005 to a high of
Php53.062 on December 29, 2005.  While the peso continued to appreciate in
2006, there can be no assurance that the peso will not depreciate and be
subject to significant fluctuations going forward.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
have maintained compliance with all of our financial ratios and covenants, as
measured under PFRS, under our loan agreements and other debt instruments.
However, if negative factors adversely affect our financial ratios, we may be
unable to maintain compliance with these ratios and covenants or be unable to
incur new debt.  Inability to comply with the financial ratios and covenants or
raise new financing could result in a declaration of default and acceleration
of some or all of our indebtedness.  The terms of some of our debt instruments
have no minimum amount for cross-default.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">If
we are unable to meet our debt service obligations or comply with our debt
covenants, we could be forced to restructure or refinance our indebtedness,
seek additional equity capital or sell assets.  An inability to effect these
measures successfully could result in a declaration of default and an
acceleration of some or all of our indebtedness.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
addition, we may have difficulty meeting debt payment obligations if we do not continue
to receive cash dividends from Smart.</p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Creditors of our subsidiaries will have superior claims to our
subsidiaries&#146; cash flow and assets</i></p>

<p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">A growing portion of our
consolidated operating revenues and cash flow from operations is derived from
our subsidiaries, particularly Smart.  Smart and some of our other subsidiaries
have significant internal cash requirements for debt service, capital
expenditures and operating expenses and so may be financially unable to pay any
dividends to PLDT.  Although Smart made dividend payments to PLDT since
December 2002, we cannot assure you that PLDT will continue to receive
dividends or other distributions, or otherwise be able to derive liquidity from
Smart or any other subsidiary or investee in the future.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Creditors
of our subsidiaries will have prior claims to our subsidiaries&#146; assets and cash
flows.  We and our creditors will effectively be subordinated to the existing
and future indebtedness and other liabilities, including trade payables, of our
subsidiaries, except that we may be recognized as a creditor on loans we have
made to subsidiaries.  If we are recognized as a creditor of a subsidiary, our
claim will still be subordinated to any indebtedness secured by assets of the
subsidiary and any indebtedness of the subsidiary otherwise deemed senior to the
indebtedness we hold. </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Our businesses require substantial capital investment, which we may not
be able to finance</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our projects under development and the continued
maintenance and improvement of our networks and services, including Smart&#146;s
projects, networks and services, require substantial ongoing capital
investment.  Our consolidated capital expenditures in 2006 and 2005 totaled Php20,348
million and Php15,864 million, respectively.  Our 2007 budget for consolidated
capital expenditures is approximately Php21,400 million, of which approximately
Php11,100 million is budgeted to be spent by PLDT and approximately Php8,800
million is budgeted to be spent by Smart; the balance represents the budgeted capital
spending of our other subsidiaries.  PLDT&#146;s capital spending is intended
principally to finance the continued build-out and upgrade of its data and Internet
protocol infrastructures and for its fixed line data services and the
maintenance of its network. <b> </b>Smart&#146;s capital spending is focused on
expanding and upgrading its transmission network facilities to meet increased
demand for cellular services.  </p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Future
strategic initiatives could require us to incur significant additional capital
expenditures.  We may be required to finance a portion of our future capital
expenditures from external financing sources, which have not yet been fully
arranged.  We cannot assure you that financing for new projects will be
available on terms acceptable to us or at all.  If we cannot complete our
development programs and other capital projects, our growth, results of
operations and financial condition could be materially and adversely affected. <b>  </b></p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Our financial position could be materially and adversely affected if
the peso significantly fluctuates against the U.S. dollar</i></p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Substantially
all of our indebtedness and related interest expense, a substantial portion of
our capital expenditures and a portion of our expenses are denominated in U.S.
dollars and other foreign currencies, but a significant portion of our revenues
is denominated in pesos.  As at December 31, 2006, 96% of our total
consolidated indebtedness was denominated in U.S. dollars.  As at December 31,
2006, approximately 43% of our consolidated foreign currency-denominated debts
were unhedged.  A depreciation of the peso against the U.S. dollar increases
the amount of our debt obligations and operating and interest expenses in peso
terms.  In the event that the peso depreciates against the U.S. dollar, we may
be unable to generate enough funds through operations (such as by raising our
service rates, including through adjustments to rates for local exchange
service based on movements in the peso-to-dollar exchange rate) and other means
to offset the resulting increase in our obligations in peso terms.  Further,
these changes could cause us not to be in compliance with the financial
covenants imposed by our lenders under certain loan agreements and other
indebtedness.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">On the other hand,
approximately 33% of PLDT Group&#146;s consolidated service revenues are either
denominated in U.S. dollars or is linked to the U.S. dollar.  In this respect,
an appreciation of the peso against the U.S. dollar reduces our revenues in
peso terms and reduces our cash flow from operations.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">During the last decade, the
peso has generally depreciated against most foreign currencies. In addition,
during this period, the Philippine economy has also, from time to time,
experienced periods of concentrated peso devaluation and limited availability
of foreign currency.  Since June 30, 1997, when the Bangko Sentral ng
Pilipinas, or BSP, announced that it would let market forces determine the
value of the peso, the peso has experienced a significant decline against the
U.S. dollar.  It depreciated from Php26.376 to US$1.00 on June 30, 1997, to
Php56.341 to US$1.00 as at December 31, 2004.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">The peso has been subject to
significant fluctuations in recent years.  From 2002 to 2004, the peso has
generally been depreciating from a high of Php49.336 on May 20, 2002 to a low
of Php56.443 on October 14, 2004.  In 2005, the peso fluctuated significantly
from a low of Php56.321 on July 8 to a high of Php53.062 on December 29, 2005.
While the peso continued to appreciate in 2006, there can be no assurance that
the peso will not depreciate and be subject to significant fluctuations going
forward. </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
peso may again be subject to significant fluctuations and may depreciate due to
a range of factors, including:</p>

<p style='margin-bottom:6.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
political and
economic developments affecting the Philippines;</p>

<p style='margin-bottom:6.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the volatility of
regional currencies, particularly the Japanese yen;</p>

<p style='margin-bottom:6.0pt;text-indent:0in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
any interest rate
increases by the Federal Reserve Bank of the United States;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
6.0pt;margin-left:.75in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
higher demand for
U.S. dollars by both banks and domestic businesses to service their maturing
U.S. dollar obligations; and</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
0in;margin-left:.75in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
foreign exchange
traders including banks covering their short U.S. dollar positions.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>The cellular telecommunications industry may not continue to grow</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The majority of our consolidated revenues is currently derived from
cellular services.  As a result, we depend on the continued development and
growth of the cellular telecommunications industry.  The cellular penetration
rate in the Philippines is estimated to have reached approximately 48%.  As
such, our cellular business is expected to grow at a slower rate as penetration
rate increases and Smart moves further into the lower-income segments of the
market.  The growth of the cellular communications market depends on many
factors beyond our control, including the continued introduction of new and
enhanced cellular devices, the price levels of cellular handsets, consumer
preferences and amount of disposable income of existing and potential
subscribers.  Any economic, technological or other developments resulting in a
reduction in demand for cellular services may harm our business.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Our businesses depend on the reliability of our
network infrastructure, which is subject to physical, technological and other
risks</h5>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">We depend to a significant degree on an uninterrupted
operation of our network to provide our services.  We also depend on robust
information technology systems to enable us to conduct our operations.  The
development and operation of telecommunications networks are subject to
physical, technological and other risks, which may cause interruptions in
service or reduced capacity for customers.  These risks include:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
physical
damage;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
power loss;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
capacity
limitation;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
cable theft;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
software
defects; and</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
breaches of
security by computer viruses, break-ins or otherwise.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The occurrence of any of these
risks could have a material and adverse effect on our ability to provide
services to customers.  While we are undertaking initiatives to prevent and/or
mitigate the occurrence of said risks, including the preparation of a disaster
recovery plan that aims to allow restoration of service at the soonest possible
time from occurrence of an incident.  We cannot assure you that these risks
will not occur or that our initiatives will be effective should such risks
occur.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>A significant number of PLDT&#146;s shares are held by three separate
shareholders, which may not act in the interests of other shareholders or
stakeholders in PLDT</i></p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">The First Pacific Group has beneficial
ownership of approximately 28% in PLDT&#146;s outstanding common stock as at May 31,
2007.  This is the largest block of PLDT&#146;s common stock that is directly or
indirectly under common ownership.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">NTT Communications, which owned
14% of PLDT&#146;s common stock as at December 31, 2005, transferred on March 14,
2006 approximately 12.6 million shares of PLDT&#146;s common stock, representing approximately
7% of the outstanding shares of PLDT&#146;s common stock, to DoCoMo pursuant to a
stock sale and purchase agreement dated January 31, 2006.  NTT Communications
is a wholly-owned subsidiary, and DoCoMo a majority-owned subsidiary of NTT.
In connection with this transaction, First Pacific and certain of its
affiliates, or the FP Parties, NTT Communications, DoCoMo and PLDT entered into
a Cooperation Agreement, dated January 31, 2006, or the Cooperation Agreement,
pursuant to which, among other things, certain rights of NTT Communications
under the Stock Purchase and Strategic Investment Agreement dated September 28,
1999 and the Shareholders Agreement dated March 24, 2000 were extended to DoCoMo.
As a result, NTT Communications and DoCoMo, in coordination with each other,
have contractual veto rights over a number of major decisions and transactions
that PLDT could make or enter into, including:  </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:0in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
capital expenditures in excess of
US$50 million;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
any investments, if the aggregate
amount of all investments for the previous 12 months is greater than US$25
million in the case of all investments to any existing investees and US$100
million in the case of all investments to any new or existing investees,
determined on a rolling monthly basis;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
any investments in a specific
investee, if the cumulative value of all investments made by us in that
investee is greater than US$10 million in the case of an existing investee and
US$50 million in the case of a new investee;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:0in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
issuance of common stock or stock
that is convertible into common stock;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:0in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
new business activities other than
those we currently engage in;</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:0in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
merger or consolidation; and</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the provision of financial support
to Piltel in excess of that remaining available under the PLDT Letter of
Support, or LOS.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Moreover, as a result of the
Shareholders Agreement, the Cooperation Agreement and their respective
stockholdings, the FP Parties, NTT Communications and/or DoCoMo are able to
influence our actions and corporate governance, including:</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
elections of PLDT&#146;s directors; and</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
approval of major corporate
actions, which require the vote of common stockholders.</p>

<p style='text-indent:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The FP Parties and/or NTT
Communications and/or DoCoMo may exercise their respective influence over these
decisions and transactions in a manner that could be contrary to your
interests.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>If a major shareholder sells its interest in PLDT, the transaction may
result in an event of default under certain circumstances </i></p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">If First Pacific Group or NTT
Communications sell all or a portion of their equity interest in PLDT, in
certain circumstances, such sale may give rise to an obligation for PLDT to
make an offer to purchase its outstanding debt under its US$250 million 11.375%
notes due 2012, and may result in a default under certain of Smart&#146;s loan
agreements.  As at December 31, 2006, Php13,208 million in principal amount of
PLDT&#146;s indebtedness is directly subject to a change in major shareholding or
offer to purchase requirement and Php1,273 million in principal amount of
Smart&#146;s indebtedness is subject to an event of default in the event of a change
in major shareholding of PLDT.  In such event, if PLDT fails to complete an
offer to purchase the affected debts, all of its debt could become immediately
due and payable as a result of various cross-default provisions.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>The franchise of Smart may be revoked due to its failure to conduct a
public offering of its shares </i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Smart has publicly stated that it
believes that it had ten years from the commencement of its operations, or
until August 2004, to conduct
a public offering of its shares required under the Public Telecommunications
Policy Act, or R.A. 7925.  As Smart has not conducted a public offering of its
shares, the Philippine Congress may revoke the franchise of Smart for its
failure to comply with the requirement under R.A. 7925 on the public offering
of its shares.  A quo warranto case may also be filed against Smart by the
Office of the Solicitor General of the Philippines for the revocation of the
franchise of Smart on the ground of violation of R.A. 7925.  In September 2004,
Senate Bill No. 1675 was filed seeking to amend Section 21 of R.A. 7925.  The
bill seeks to declare that a telecommunications entity shall be deemed to have
complied with the requirement of making a public offering of its shares if
two-third of its outstanding voting stock are owned and controlled directly or
indirectly, by a listed company.  The bill is currently pending in the
Philippine Senate.  However, we cannot assure you that such bill will be
enacted and that the franchise of Smart will not be revoked due to Smart&#146;s
failure to timely conduct a public offering of its shares.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK18"></a><a name="OLE_LINK17"><i>Our business is significantly affected by governmental
laws and regulations, including regulations in respect of our franchises, rates
and taxes</i></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">We operate our business under
franchises, each of which is subject to amendment, termination or repeal by the
Philippine Congress.  Additionally, PLDT operates pursuant to various
provisional authorities and certificates of public convenience and necessity,
or CPCNs, which are granted by the NTC and expire between now and 2028.  Some
of PLDT&#146;s CPCNs and provisional authorities have already expired.  However,
PLDT filed applications for extension of these CPCNs and provisional authorities
prior to their respective expiration dates and is therefore entitled to
continue to conduct its business under its existing CPCNs and provisional
authorities pending the NTC&#146;s decisions on these extensions.  Smart also
operates its cellular, international long distance, national long distance and
global mobile personal communications via satellite services pursuant to CPCNs,
which will expire upon the expiration of its franchise.  Smart&#146;s franchise is
due to expire on March 27, 2017, 25 years after the date on which its current
franchise was granted.  Smart operates international private leased circuits
under a provisional authority, which expired on November 6, 2006.  Smart
applied for an extension of this provisional authority or for the issuance of a
CPCN prior to its expiration.  The NTC has not yet acted on the motion.  Because
PLDT and Smart filed the applications for extension on a timely basis, we
expect that these extensions will be granted.  However, we cannot assure you
that the NTC will grant these extensions.  If a CPCN has not been issued, the
NTC may permit an operator to provide services pursuant to a provisional
authority.  Provisional authorities are typically granted for a period of 18
months.  The Philippine Revised Administrative Code of 1987 provides that if
the grantee of a license or permit, such as a CPCN or provisional authority,
has made timely and sufficient application for the extension thereof, the
existing CPCN or provisional authority will not expire until the application is
finally decided upon by the administrative agency concerned.  However, we
cannot assure you that our franchises, CPCNs and provisional authorities will
be renewed.  For a description of our licenses, see Item 4. &#147;Information on the
Company &#150;&#150; Licenses and Regulation.&#148;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The NTC also regulates the rates
we are permitted to charge for services that have not yet been deregulated,
such as local exchange services.  We cannot assure you that the NTC will not
impose additional obligations on us that could lead to the revocation of our
licenses if not adhered to and/or reduction in our revenues and other income or
profitability.  In addition, the NTC could adopt changes to the regulations
governing our interconnection with other telecommunications companies or the
rates and terms upon which we provide services to our customers that could have
a material and adverse effect on our results of operations.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
the first quarter of 2005, House Bill, or HB, No. 926 was filed and is now
pending in the House of Representatives of the Philippines.  The proposed bill
provides for the cancellation of the currency exchange rate mechanism pursuant
to which utility companies, including us, are permitted to adjust their monthly
local exchange service rates according to changes in the peso-to-U.S. dollar
exchange rate.  If this bill is passed into law or if the NTC issues guidelines
to change the basis of the currency exchange rate mechanism, our ability to
generate U.S. dollar-linked revenues from our local exchange business could be
adversely affected.  A decline in our foreign currency-linked revenues could
increase our exposure to risks from declines in the value of the Philippine
peso against the U.S. dollar.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
PLDT Group is also subject to a number of national and local taxes. &nbsp;On
May 24, 2005, the president of the Philippines signed into law Republic Act No.
9337, or R.A. 9337, amending certain sections of the National Internal Revenue
Code, which took effect on November 1, 2005.  R.A. 9337, among others,
introduced the following changes:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:58.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0">a.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The regular corporate income tax
rate for domestic corporations and resident/non-resident foreign corporations
increased from 32% to 35% effective November 1, 2005 and will be reduced to 30%
effective January 1, 2009.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">b.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The VAT rate increased from 10% to
12% effective February 1, 2006.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:58.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0">c.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The input VAT on capital goods
should be spread evenly over the estimated useful life or sixty months,
whichever is shorter, if the acquisition cost, excluding the VAT component
thereof, exceeds one million pesos.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">There can be no assurance
that the increase in taxes will not have a material adverse effect on PLDT
Group&#146;s revenues, profitability and cash flows. &nbsp;In addition, there can be
no assurance that PLDT Group will not be subject to new and/or additional taxes
and that PLDT Group will be able to impose additional charges or fees to
compensate for the imposition of such taxes. </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">There
are also various bills pending in the Philippine Congress which propose to impose
a franchise tax on telecommunication companies and to tax telecommunications
services, among them, the imposition of a tax on mobile phone companies on all
text entries to text games; the imposition of a Php0.50 specific tax on each
SMS to be borne by the cellular phone companies; and the imposition of a 10% ad
valorem tax on all cellular phone calls using 3G.  We cannot assure you that we would be able to impose additional
charges or fees to compensate for the imposition of such taxes.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">The NTC may implement
proposed changes in existing regulations and introduce new regulations which
may result in increased competition and may have negative implications for our
revenues and profitability</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">On
June 16, 2000, the NTC issued Memorandum Circular No. 13-6-2000 proposing that
cellular operators, including Smart and Piltel, be required, among other
things:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:.75in;margin-bottom:.0001pt;text-align:left;
text-indent:-.25in;page-break-after:auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to bill their
subscribers for cellular calls on a six-second pulse basis instead of the
current per minute basis; </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
not to bill
calls directed to recorded voice messages; and </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to extend the
expiration date of prepaid cards from the current two months to two years.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Along
with the other Philippine cellular operators, Smart filed a complaint for the
nullification of this memorandum circular before the regional trial court of
Quezon City and sought for the issuance of a preliminary injunction while
proceedings are ongoing.  The regional trial court issued the preliminary
injunction, which restrained the implementation of the memorandum circular.  The
complaint of the Philippine cellular operators is being heard by the regional
trial court of Quezon City.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
December 2005, the NTC issued a consultative document on the development of
competition policy framework for the information communications sector.  The
consultative paper contains eleven questions which cover the following key
areas:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
a review of market trends deemed to impinge on current and future
state of competition in the sector;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
an exploration of major policies that may change the balance of
market power, hence the nature and degree of competition;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
an assessment of the quality of current regulation, identifying
major handicaps of the NTC; and</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
a discussion of the urgent tasks for the NTC to effectively
govern a dynamic and complex industry.</p>

<p style='margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">The NTC invited
public comment from industry stakeholders and other interested parties in
relation to the issues raised in the paper.  On January 31, 2006, we submitted
a comprehensive response to the consultative paper.&nbsp;  On August 24, 2006,
the NTC issued another consultative document specifically focusing on its
proposal to impose asymmetric regulations on carriers with significant market
power, or SMP, including a discussion on its proposed roadmap for implementing
such SMP obligations.  On October 23, 2006, we submitted our response to the
second consultative paper to the NTC.   </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">In formulating
both our responses, we took into account both industry interests and the
broader context of our nation&#146;s economic development, drawing on the experience
in other countries.  We believe that the basis for the need for regulatory
reform is unclear and the envisioned SMP regime is inappropriate for the Philippines, as the market is highly competitive and well-functioning.  In addition, the
imposition of SMP and its attendant obligations would discourage capital
investments in a sector on which the Philippine economy is highly dependent.  We
have therefore proposed that the NTC explore its full range of options
available on a cost-benefit basis, taking into consideration the specific local
context of the Philippine marketplace.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">There
can be no assurance that the NTC will not impose changes to the current
regulatory framework which may lead to increased competition.  Any such changes
may have an adverse effect on our business, results of operations and
prospects.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>If we are unable to install and maintain telecommunications facilities
and equipment in a timely manner, we may not be able to keep up with our
principal competitors, which may have negative implications for our revenue and
profitability</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Our
business requires the regular installation of new, and the maintenance of
existing, telecommunications transmission and other facilities and equipment,
which are being undertaken.  The installation and maintenance of these
facilities and equipment are subject to risks and uncertainties relating to:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
shortages of
equipment, materials and labor;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
work stoppages
and labor disputes;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
interruptions
resulting from inclement weather and other natural disasters;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
unforeseen
engineering, environmental and geological problems; and</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
unanticipated
cost increases.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Any
of these factors could give rise to delays or cost overruns in the installation
of new facilities or equipment or could prevent us from properly maintaining
the equipment used in our networks, and could have a material and adverse
effect on our results of operations and financial condition.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>We may not be successful
in our acquisitions of and investments in other companies and businesses, and
may therefore be unable to implement fully our business strategy </i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-top:0in;text-align:left;
text-indent:.5in;line-height:normal' style="margin-top:0;margin-bottom:0">As
part of our growth strategy, we may, from time to time, make acquisitions and
investments in companies or businesses, which may or may not be significant.
The success of our acquisitions and investments depends on a number of factors,
including:</p>

<p align=left style='margin-left:.5in;text-align:left;
text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
our ability
to identify suitable opportunities for investment or acquisition; </p>

<p align=left style='margin-left:.5in;text-align:left;
text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
our ability
to reach an acquisition or investment agreement on terms that are satisfactory
to us or at all; </p>

<p align=left style='margin-left:.5in;text-align:left;
text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the
extent to which we are able to exercise control over the acquired company; </p>

<p align=left style='margin-left:.5in;text-align:left;
text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the
economic, business or other strategic objectives and goals of the acquired
company compared to those of the PLDT Group; and </p>

<p align=left style='margin-left:.5in;text-align:left;
text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
our ability
to successfully integrate the acquired company or business with our existing
businesses. </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Any
of our contemplated acquisitions and investments may not be consummated due to
reasons or factors beyond its control.  Even if any contemplated acquisitions
and investments are consummated, we may not be able to realize any or all of
the anticipated benefits of such acquisitions and investments.  Moreover, if we
are unsuccessful in our contemplated acquisitions and investments, we may not
be able to implement fully our business strategy to maintain or grow certain of
our businesses.</p>

<p style='page-break-after:avoid !msorm' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Failure to achieve and maintain effective internal control over
financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act of
2002 could adversely impact investor confidence and the market price of our
common shares and ADSs </i></p>

<p style='text-indent:24.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Effective
internal controls over financial reporting are necessary for us to provide
reasonable assurance with respect to our financial reports and to effectively
prevent fraud.  If we are unable to provide reasonable assurance with respect
to our financial reports and effectively prevent fraud, our reputation and
results of operations could be harmed.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
are required to comply with various Philippine and U.S. laws and regulations on
internal controls.  For example, pursuant to Section 404 of the Sarbanes-Oxley
Act of 2002, beginning with this Annual Report on <br>
Form 20-F for the fiscal year ending December 31, 2006, we are required to
include a report by our management on our internal control over financial
reporting in our Annual Reports on Form 20-F that contains an assessment by our
management of the effectiveness of our internal control over financial
reporting.  In addition, our independent registered public accounting firm must
attest to and report on our management&#146;s assessment of the effectiveness of our
internal control over financial reporting.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Internal
control over financial reporting may not prevent or detect misstatements
because of its inherent limitations, including the possibility of human error,
the circumvention or overriding of controls, or fraud.  Therefore, even
effective internal control over financial reporting can provide reasonable
assurance with respect to the preparation and fair presentation of financial
statements.  If we fail to maintain the adequacy of our internal control over
financial reporting, including through a failure to implement required new or
improved controls, or if we experience difficulties in their implementation,
our business and operating results could be harmed, we could fail to meet our
reporting obligations and there could be a material adverse effect on the
market prices of our common shares and ADSs.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Risks Relating to the Philippines</i></b></p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>PLDT&#146;s business may be affected by political or social or economic
instability in the Philippines</i></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">On May 10, 2004, the Philippines held a presidential election which resulted in a victory by the incumbent
President Arroyo who successfully retained her post.  Shortly after the
elections, allegations of irregularities in the presidential elections, such as
stolen ballots and vote buying intensified.  The Philippine Congress commenced
an inquiry into a wire tapped audio tape which contains a conversation
allegedly between President Gloria Macapagal-Arroyo and a commissioner of the
Commission on Elections discussing the vote count on the presidential election.
On June 27, 2005, President Gloria Macapagal-Arroyo publicly stated that she
did speak to a commissioner of the Commission on Elections in order to protect
her votes, but not to influence the outcome of the election.  Impeachment
complaints based on allegations of culpable violation of the Constitution,
graft and corruption and betrayal of public trust were filed against President
Arroyo with the Philippine Congress.  On September 6, 2005, the Philippine
Congress voted to reject the impeachment complaints against President Arroyo.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">Other recent developments
include coup d&#146;etat attempts against the administration of President Arroyo.
On February 24, 2006, President Arroyo declared a state of emergency allowing
for warrantless arrests and a temporary take-over of privately-owned utility
companies.  On March 3, 2006, President Arroyo lifted the state of emergency.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">In June 2006,
President Arroyo proposed to amend the Constitution of the Philippines to implement a unicameral federal, parliamentary system patterned after the German
constitution. Under said system, the country would be split into &#147;states&#148; with
each &#147;state&#148; granted a local legislature.  There were also plans to remove or
ease the current ban on foreign ownership of property, land and commercial
organizations in the Philippines.  A group of local leaders have joined together
in what was known as the &#147;People&#146;s Initiative&#148; which caused to further the
amendment of the Constitution.  In addition to nationwide campaigns and
rallies, a petition was filed with the Supreme Court, or SC, to reform the
Constitution.  This petition was rejected by the SC on October 25, 2006.
Nevertheless, the People&#146;s Initiative continues to advocate amendments to the Constitution.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">Furthermore, the Philippine
economy has experienced periods of slow growth, high inflation and significant
devaluation of the peso.  The Philippine government is also facing a fiscal
deficit that the government is aiming to eliminate by 2008 by implementing a
number of economic reforms.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
fiscal deficit position of the Philippine government and the ongoing political
uncertainty have resulted in increased concerns about the political and
economic stability of the country.  This, in turn, has resulted in the
volatility of the peso against the dollar.  There can be no assurance that the
political environment in the Philippines will be stable or that the current or
any future government will adopt economic policies conducive to sustained
economic growth or which do not impact adversely on the current regulatory
environment for telecommunications or other companies.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>If foreign exchange controls were to be imposed, our ability to meet
our foreign currency payment obligations could be adversely affected</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Approval
from or registration with the BSP for the issuance and guarantee of foreign currency-denominated
borrowings is not required in order to make our foreign currency payment
obligations legally valid and binding.  However, receiving this approval and
registration will enable a borrower to access the banking system to obtain
foreign currency to service its debt obligations rather than using other
sources of foreign currency, for example, foreign currency revenue streams.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The Philippine government has, in the past, instituted
restrictions on the conversion of the peso into foreign currency and the use of
foreign exchange received by Philippine companies to pay foreign
currency-denominated obligations.  The Monetary Board of the BSP has statutory
authority, with the approval of the President of the Philippines, during a
foreign exchange crisis or in times of national emergency, to:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
suspend temporarily or restrict
sales of foreign exchange;</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
require licensing of foreign
exchange transactions; or</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
require the delivery of foreign
exchange to the BSP or its designee banks.</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
cannot assure you that foreign exchange controls will not be imposed in the
future.  If imposed, these restrictions could materially and adversely affect
our ability to obtain foreign currency to service our foreign currency
obligations.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>The occurrence of natural catastrophes may materially disrupt our
operations</i></p>

<p style='line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The Philippines has experienced a number of major
natural catastrophes over the years including typhoons, volcanic eruptions and
earthquakes that may materially disrupt and adversely affect our business
operations.  The recent earthquake that hit Taiwan in December 26, 2006 severed
cable systems linking the Philippines to other Asian and American countries,
causing major slowdown of voice and non-voice data traffic exchange.  There can
be no assurance that the insurance coverage PLDT maintains for these risks will
adequately compensate it for all damages and economic losses resulting from
natural catastrophes.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><a name="_Toc170286142"></a><a
name="_Toc75779196"></a><a name="_Toc46082255"></a><a
name="_Item_4._Information_on the Company"></a>Item 4.       Information on the Company</h2>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286143"></a><a name="_Toc75779197"></a><a
name="_Toc46082256"></a><a name="_Overview"></a><b>Overview</b></p>

<p style='line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
are the leading national telecommunications service provider in the Philippines.  Through our three principal business groups &#151; wireless, fixed line, and
information and communications technology &#151; we offer a wide range of
telecommunications services to approximately 26 million subscribers in the
Philippines across the nation's most extensive fiber optic backbone and fixed
line, cellular and satellite networks.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
are the leading fixed line provider in the Philippines with approximately 63%
of the total reported fixed line subscribers nationwide as at December 31,
2006.  Smart, our wholly-owned subsidiary, is the leading cellular service
provider in the country, with approximately 41% of total reported cellular
subscribers as at December 31, 2006.  Piltel, Smart&#146;s 92.1%-owned subsidiary,
had approximately 17% of total reported cellular subscribers as at December 31,
2006.  We have interests in the information and communications technology
sectors, including the operation of our <i>Vitro</i>TM data center,
call center and business process outsourcing, or BPO, businesses.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our common shares are listed and
traded on the Philippine Stock Exchange, or PSE, and our American Depositary
Shares, or ADSs, evidenced by American Depositary Receipts, or ADRs, are listed
and traded on the New York Stock Exchange in the United States.  </p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">We
had a market capitalization of approximately Php481,948 million (US$10,437
million) as at May 31, 2007, representing one of the largest market
capitalizations among Philippine-listed companies.  For the year ended December
31, 2006, we had consolidated operating revenues of Php127,536 million (US$2,600
million). </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
principal executive offices are located at the Ramon Cojuangco Building, Makati Avenue, Makati City, Philippines and our telephone number is (632) 816-8556.
Our website address is <i>www.pldt.com.ph</i>.  The contents of our website are
not a part of this annual report.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286144"></a><a name="_Toc75779198"></a><a
name="_Toc46082257"></a><a name="_Historical_Background_and_Developme"></a><b>Historical Background and Development</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK7"></a><a name="OLE_LINK6">PLDT was incorporated under the old Corporation Law of
the </a>Philippines (Act 1459, as amended) on November 28, 1928,
following the merger of four telephone companies under common U.S. ownership.  In 1967, effective control of PLDT was sold by General Telephone and Electronics
Corporation (a major shareholder since PLDT's incorporation) to a group of
Filipino businessmen.  In 1981, in furtherance of the then existing policy of
the Philippine government to integrate the Philippine telecommunications
industry, PLDT purchased substantially all of the assets and liabilities of the
Republic Telephone Company, which at that time was the second largest telephone
company in the Philippines.  In 1998, the First Pacific Group acquired a
significant interest in PLDT.  On March 24, 2000, NTT Communications, through
its wholly-owned subsidiary NTT Communications Capital (U.K.) Limited, or
NTTC-UK, became PLDT&#146;s strategic partner with approximately 15% economic and
voting interest in the issued and outstanding common stock of PLDT.  Simultaneous
with NTT Communications&#146; investment in PLDT, we acquired 100% of Smart.  On March
14, 2006, NTT DoCoMo acquired from NTT Communications approximately 7% of
PLDT&#146;s outstanding common shares held by NTT Communications with NTT
Communications retaining ownership of approximately 7% of PLDT&#146;s common
shares.  On February 28, 2007, Metro Pacific Asset Holdings, Inc., a Philippine
affiliate of First Pacific, completed the acquisition of an additional interest
of approximately 46% in PTIC.  This additional investment in PTIC, a
shareholder of PLDT, represents an attributable interest of approximately 6.4% of
the issued common shares of PLDT and thereby raised the First Pacific Group&#146;s beneficial
ownership to approximately 28% of PLDT&#146;s shares of common stock as at that date.
See Item 7. &#147;Major Shareholders and Related Party Transactions&#148; for further
discussion.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">PLDT's original
franchise was granted in 1928 and was last amended in 1991, extending its
effectiveness until 2028 and broadening PLDT&#146;s franchise to permit PLDT to
provide virtually every type of telecommunications service.  PLDT&#146;s franchise
covers the business of providing basic and enhanced telecommunications services
in and between the provinces, cities and municipalities in the Philippines and
between the Philippines and other countries and territories including mobile,
cellular, wired or wireless telecommunications system, fiber optics,
multi-channel transmission distribution systems and their value-added services
such as but not limited to transmission of voice, data, facsimile, control
signals, audio and video, information services bureau and all other telecommunications
systems technologies, as are at present available or can be made available
through technical advances or innovations in the future.  See Item 8. &#147;Financial
Information &#150;&#150; Legal Proceedings &#151; Quo Warranto Action&#148; for information
regarding legal proceedings initiated by the Solicitor General with respect to
PLDT's franchise.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Since the implementation of its
Subscriber Investment Plan, or SIP, in 1973 pursuant to Presidential Decree No.
217, which in the past required telephone subscribers to purchase shares of
PLDT's preferred stock, PLDT has developed a broad base of public ownership
with 2,189,374 common and preferred stockholders of record as at December 31,
2006.  As approved by the NTC, the SIP was made optional beginning in April 2003,
from being compulsory in earlier years.  Of these stockholders, 2,172,964 are
Philippine persons representing approximately 86% of PLDT's outstanding common
and preferred shares.  For purposes of this paragraph, all the ADSs, each
representing one PLDT common share and evidenced by American Depositary
Receipts, or ADRs, are considered to be held of record in the United States.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our consolidated capital
expenditures amounted to Php20,348 million, Php15,864 million and Php19,268
million in 2006, 2005 and 2004, respectively.  Of these amounts, Php8,573
million, Php6,389 million and Php3,917 million were attributable to PLDT for
2006, 2005 and 2004, respectively, while Php10,506 million, Php8,785 million
and Php14,735 million were spent by Smart for 2006, 2005 and 2004,
respectively.  The remaining balances were spent by our other subsidiaries,
principally ePLDT and its subsidiaries.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286145"></a><a name="_Toc75779199"></a><a
name="_Toc46082258"></a><a name="_Organization"></a><b>Organization</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT Group includes the following significant
subsidiaries:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:88.74%;margin-left:.25in;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:8.4pt'>
 <td   rowspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Name of Subsidiary</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.4pt'>
 <p align=center style='margin-top:3.0pt;margin-right:0in;
 margin-bottom:0in;margin-left:1.45pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Place of
 Incorporation</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.4pt'>
 <p align=center style='margin-top:3.0pt;margin-right:0in;
 margin-bottom:0in;margin-left:1.45pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Principal Activity</b></p>
 </td>
 <td   colspan=2 valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Percentage of
 Ownership</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Direct</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Indirect</b></p>
 </td>
 </tr>

 <tr style='height:5.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p style='margin-left:1.45pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p style='margin-left:1.45pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:5.0pt'>
 <p align=right style='margin-right:.1in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   colspan=5 valign=bottom style=' padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:.1in;margin-bottom:
 1.0pt;margin-left:0in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Wireless</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cellular mobile services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart Broadband </p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Internet broadband and distributor</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in' style="margin-top:0;margin-bottom:0">Wolfpac </p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Mobile applications developer and <br>
 service provider</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Providing cellular and fixed line services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">92.1</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Telesat</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite communications services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">94.4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ACeS Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite phone services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">88.5</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">11.5</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Mabuhay Satellite</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite communications services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">67.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   colspan=5 valign=bottom style=' padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:0in' style="margin-top:0;margin-bottom:0"><b>Fixed Line</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ClarkTel</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">SubicTel</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications
 services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">PLDT
 Global</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">British Virgin Islands</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications
 services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">SNMI</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Data
 and network services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Maratel</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications
 services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">97.5</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">BCC</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications,
 infrastructure <br>
 and related value-added services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">75.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   colspan=5 valign=bottom style=' padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:0in' style="margin-top:0;margin-bottom:0"><b>Information and
 Communications Technology</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ePLDT</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Information
 and communications infrastructure for internet-based services, e-commerce,
 call centers <br>
 and IT-related services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Vocativ</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Call
 center services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Parlance</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Call
 center services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Ventus</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Call
 center services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">SPi
 and Subsidiaries (including CyMed)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Business
 process outsourcing, or <br>
 BPO, services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Infocom</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet
 services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">99.6</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">netGames</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Publisher
 of online games</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">80.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Digital
 Paradise (formerly Netopia Computer Technologies, Inc.)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet
 access services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">75.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Level
 Up!</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Publisher
 of online games</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">60.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Digital
 Paradise Thailand</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Thailand</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet
 access services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">51.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Airborne
 Access</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Wireless
 internet services</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">51.0</p>
 </td>
 </tr>
</table></center></div>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.25in;
line-height:normal' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in;
line-height:normal' style="margin-top:0;margin-bottom:0">As described
below, SPi, CyMed and Level Up! were all acquired in 2006 and included in our
2006 consolidated financial statements.  See <i>Note 9 &#150; Goodwill and Other
Intangible Assets </i>to the accompanying consolidated financial statements in
Item 18 for further discussion.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.25in;
line-height:normal' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:.5in;page-break-after:auto' style="margin-top:0;margin-bottom:0">On
September 2, 2004, Smart entered into a sale and purchase agreement to acquire
100% of Smart Broadband, a company primarily engaged in providing wireless
broadband and data services to small and medium-scale enterprises in the
Philippines, for a total consideration of US$45 million, of which payments of
US$11 million and US$7 million for an equity interest of 40% in Smart Broadband
were made in 2004 and payment of US$4 million for an additional equity interest
of 9% was made in January 2005.  The balance of US$23 million in respect of the
remaining 51% equity interest in Smart Broadband was paid on March 7, 2006.
The acquisition aims to strengthen Smart&#146;s position in the wireless data
segment and is in line with Smart&#146;s overall strategy of providing the widest
range of innovative wireless services.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:.5in;page-break-after:auto' style="margin-top:0;margin-bottom:0">With
Smart and PLDT owning 85.6% and 6.5% as at the year ended December 31, 2004,
respectively, of Piltel's common equity, Piltel was reconsolidated into the
PLDT group's wireless financial position and results of operations starting the
year ended December 31, 2004.&nbsp; On April 25, 2005, PLDT and Smart entered
into a subscription and assignment agreement under which PLDT assigned and
transferred to Smart its 767 million Piltel common shares in exchange for 11
million of Smart's preferred shares.  As a result, Smart's shareholdings in
Piltel now represents 92.1% of Piltel's outstanding common shares and PLDT no
longer owns any shares of Piltel's common stock.  </p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Following
its acquisition in October 2003 of an 80% equity interest in Wolfpac, a company
engaged in the business of consumer mobile applications software development
and content development, Smart acquired in July 2006 the remaining 20% equity
interest in Wolfpac.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">On February 16, 2006, ePLDT
acquired a 60% equity interest in Level Up!, a leading publisher of online
games in the Philippines.  The acquisition of Level Up!, together with
netGames, ePLDT&#146;s online gaming subsidiary, is expected to strengthen ePLDT&#146;s
online gaming business in the Philippines.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">On July 11, 2006, ePLDT acquired 100% of SPi Technologies, Inc., or SPi,
and its direct and indirect Philippine and offshore subsidiaries for a cash
consideration of US$135 million.  SPi is the second largest pure-play BPO and
the ninth largest independent BPO service provider worldwide.  It has
operations in 19 locations in North America, Europe and Asia.  On August 11,
2006, SPi acquired 100% of CyMed, a leading medical transcription company based
in Richmond, Virginia and on April 16, 2007, SPi acquired 100% of Springfield
Service Corporation, one of the ten largest U.S. medical billing and revenue
cycle management companies.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Wireless</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
provide cellular, and wireless broadband, satellite, VSAT and other services
under our wireless business, contributing about 96% and 4% of our wireless
service revenues, respectively, in 2006.  The rapid growth in the cellular
market has resulted in a change in our revenue composition and sources of our
revenue growth.  Starting with 2003, cellular service was our major revenue
source surpassing fixed line revenues.  Cellular data services, which include
all text messaging and text-related services ranging from ordinary text to
value-added services, contributed significantly to our revenue increase.  Our
wireless operating revenues accounted for 63%, 62% and 61% of our consolidated
operating revenues for the years ended December 31, 2006, 2005 and 2004,
respectively.  For the years ended December 31, 2006, 2005 and 2004, cellular
service revenues accounted for 96%, 96% and 97%, respectively, of our wireless
business operating revenues.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
provide cellular services (including handset sales), through Smart and its
subsidiary, Piltel.  Smart is the leading cellular services provider in the Philippines, with 17,201,005 subscribers as at December 31, 2006, representing an estimated
market share of approximately 41%.  Piltel, a reseller of Smart's GSM network
with its own branding, had 6,974,379 subscribers as at December 31, 2006,
representing an estimated market share of approximately 17%.  In 2006, the
combined number of Smart's and Piltel's subscribers increased by 3,766,763, or 18%,
to 24,175,384.  As at December 31, 2006, cellular penetration in the Philippines reached approximately 48%, which was nearly 14 times the country's fixed line
penetration, although the existence of subscribers owning multiple SIMs has
likely overstated this penetration rate to a certain extent.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Smart's
and Piltel's cellular subscriber gains were predominantly attributable to their
respective prepaid services.  Approximately 99% of Smart&#146;s and all of Piltel&#146;s cellular
subscribers were prepaid as at December 31, 2006.  The predominance of prepaid
service reflects one of the distinguishing characteristics of the Philippine cellular
market.  The growth in our prepaid service has enabled us to increase and
broaden our subscriber base rapidly while controlling credit risk and reducing
billing and administrative costs on a per-subscriber basis.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Our
cellular subscriber growth has also been driven by text messaging.  Text
messaging is extremely popular in the Philippines, particularly on the prepaid
platform, as it provides a convenient and inexpensive alternative to voice and
e-mail based communications.  Text messaging contributed significantly to
Smart's cellular data service revenue growth in 2006, generating revenues of
Php34,403 million, an increase of Php3,594 million, or 12%, over 2005.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart's
Nokia-provided cellular network is the most extensive in the Philippines, covering substantially all of Metro Manila and most of the other major population
centers in the Philippines.  Its dual-band GSM network allows it to efficiently
deploy high capacity 1800 MHz base transceiver stations, or BTS, in dense urban
areas while its 900 MHz BTS can be much more economically deployed in
potentially high growth, but less densely populated provincial areas.  With
6,099 GSM base stations as of the end of December 2006, Smart&#146;s cellular
network covers approximately 99% of all towns and municipalities in the Philippines, accounting for approximately 99% of the population.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Fixed Line</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">We are the leading fixed line operator in the Philippines and the largest company providing fixed line telecommunications services
throughout the country.  Our fixed line business group offers local exchange,
international long distance, national long distance, data and other network and
miscellaneous services.  We had 1,776,647 fixed line subscribers as at December
31, 2006.  Operating revenues from our fixed line services accounted for 32%,
36% and 37% of our consolidated operating revenues for the years ended December
31, 2006, 2005 and 2004, respectively.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
6,400-kilometer long domestic fiber optic network, or DFON, is supported by an
extensive digital microwave backbone.  Our fixed line network reaches all of
the major cities and municipalities in the Philippines, with a concentration in
the Metropolitan Manila area.  Our network offers the country's most extensive
connections to international networks through three international gateway
switching exchanges, satellite systems and various regional submarine cable
systems in which we have interests.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Information and
Communications Technology</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Through
our wholly-owned subsidiary, ePLDT, we provide broad-based integrated
information and communications technology, or ICT, services focusing on
infrastructure and solutions for Internet applications, Internet protocol-based
solutions and multimedia content delivery.  ePLDT's principal activities are
the operation of an Internet data center under the brand name <i>Vitro&#153;</i>,
call center business, BPO, and Internet and online gaming business.  Operating
revenues from our ICT services accounted for 5% of our consolidated operating revenues
for the year ended December 31, 2006 and 2% for each of the years ended December 31,
2005 and 2004.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK20"></a><a name="OLE_LINK19"></a><a
name="_Toc170286146"></a><a name="_Toc75779200"></a><a name="_Toc46082259"></a><a
name="_Strengths"></a><b>Strengths</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">We believe our business is
characterized by the following competitive strengths:</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Recognized Brands</i>.  PLDT and Smart are strong and widely recognized
brand names in the Philippines.  We have built the PLDT brand name for over 75
years as the leading telecommunications provider in the Philippines.  Smart is recognized in the Philippines as an innovative provider of high-quality
cellular services.  Piltel's <i>Talk &#145;N Text</i> brand, which is provided using
Smart&#146;s network, has also gained significant recognition.</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Leading Market Shares</i>.  With approximately 26 million fixed line and
cellular subscribers as at December 31, 2006, we have the leading market
position in both the fixed line and cellular markets in the Philippines.  </p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Diversified Revenue Sources</i>.  As a result of the continued growth of cellular
service in the country, approximately 63% of our consolidated operating revenues
in 2006 were derived from our wireless business segment.  Fixed line revenues,
which represented 32% and 36% of our consolidated operating revenues in 2006
and 2005, respectively, have remained stable over the past three years despite
pressures on traditional fixed line voice revenues, resulting from increases in
our fixed line data and other network services.  We continue to identify and
develop new revenue sources from our cellular, fixed line and ICT businesses.</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Advanced Integrated Network</i>.  With one of the most advanced and extensive
telecommunications networks in the Philippines, we are able to offer a wide
array of communications services.  We are enhancing the capabilities of our
fixed line and wireless networks to allow us to better exploit this competitive
strength and achieve higher levels of network efficiency in providing voice and
data services.  In addition, we have commenced the upgrade to Next Generation
Network, or NGN, and the roll out of 3G and wireless broadband in order to
increase broadband subscribers, and expand our data/broadband capabilities.</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Innovative Products and
Services</i>.  We have successfully
introduced a number of innovative and award-winning cellular products and
services, including <i>Smart Load </i>and<i> Pasa Load.</i>  <i>Smart Load</i>
is an &#147;over-the-air&#148; electronic loading facility designed to make reloading of
air time credits more convenient for, and accessible to consumers.  <i>Pasa
Load </i>(the term &#147;pasa&#148; means &#147;transfer&#148; in the vernacular), a derivative
service of <i>Smart Load</i> that allows load transfers to other <i>Smart Buddy</i>
and <i>Talk &#145;N Text </i>subscribers.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Strong Strategic Relationship</i>.  We have important strategic relationships with NTT
Communications, DoCoMo and First Pacific.  The technological support,
international experience and management expertise made available to us through
these strategic relationships enhance our market leadership and ability to
provide and cross-sell a more complete range of products and services.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286147"></a><a name="_Toc75779201"></a><a
name="_Toc46082260"></a><a name="_Strategy"></a><b>Strategy</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
key elements of our business strategy are:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Build on our leading positions
in the fixed line and wireless businesses</i>.  We plan to build on our position as the leading provider of fixed
line service in the Philippines by continuing to launch new products and
services to increase subscriber value and utilization of our existing
facilities and equipment at reduced cost.  We plan to build on our position as
the leading wireless service provider in the Philippines by continuing to
introduce new products and services to increase our subscribers' use of our
network for both voice and data, as well as their reliance on our services.  We
are currently upgrading our fixed line facilities to NGN, and have rolled out a
3G network based on a W-CDMA technology as well as expanding our DSL and
wireless broadband facilities.  Our operating target is to continue growth in
profitability by increasing our revenues while controlling our costs.</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Capitalize on our strength as
an integrated provider of telecommunications services</i>.  We offer the broadest range of telecommunications
services among all operators in the Philippines.  We plan to capitalize on this
position to maximize revenue opportunities by bundling and cross-selling our
products and services between, and by developing convergent products that
feature the combined benefits of voice and data, fixed line, wireless and ICT
services utilizing our network and business platforms.  We are also lowering
our costs by integrating the operations of our different businesses.</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Strengthen our leading position
in the data market</i>.  Leveraging on
the inherent strength of our fixed line business, we are committed to further
develop, enhance and lead our fastest growing business segment &#150; data and other
network services.  Consistent with our strategy of introducing innovative
products and services using advanced technology, we have launched various
products and services that address different market needs.  </p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Maintain a strong financial
position and improve shareholder returns. &nbsp;</i>Since 2002, we have significantly improved our
financial position by utilizing our cash flows principally for debt reduction.
&nbsp;As the cash flows generated by our businesses have increased and our
leverage ratios have improved, we were able to restore the payment of common
dividends to our shareholders beginning 2005. &nbsp;Since then, we have
increased our dividend payout to common shareholders from 10% of 2004 earnings
to 40% of 2005 earnings and to 60% of 2006 earnings.&nbsp;&nbsp;We expect that
a greater proportion of our free cash flows in succeeding years will be
utilized for the payment of common dividends and investments in new growth
areas while continuing to maintain a healthy balance sheet position.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286148"></a><a name="_Business"></a><b>Business</b></p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc75779202"></a><a name="_Toc46082262"><b><i>Wireless</i></b></a></p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">We
provide cellular, wireless broadband, satellite, VSAT and other services
through our wireless business segment.  </p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Cellular Service</i></p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Overview</i></p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
cellular business, which we provide through Smart and Piltel to over 24 million
subscribers, approximately 99% of whom are prepaid subscribers, is focused on
providing wireless voice communications, wireless data communications
(primarily through text messaging) and a variety of other value-added services,
which includes (a) <i>Mobile Banking</i> (banking services delivered over the cellular
network); (b) specialized content such as ringtones, logos, caller ringback
tunes; (c) <i>Smart Money</i>; (d) international roaming; and (e) games and
other VAS developed on Smart&#146;s platform.  Smart services approximately seven
million subscribers of Piltel on its GSM network through a facilities service
agreement with Piltel, under the brand name <i>Talk &#145;N Text</i>.</p>

<p style='margin-left:.75in;text-indent:-.25in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
following table summarizes key measures of Smart&#146;s and Piltel&#146;s cellular
business as at and for the years ended December 31, 2006, 2005 and 2004:</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Years Ended
 December 31,</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </div>
 </td>
 </tr>

 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Systemwide cellular subscriber base</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,175,384</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,408,621</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,208,232</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">17,201,005</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,424,196</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,595,782</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:22.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Prepaid</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,882,442</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,144,118</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,321,288</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:22.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Postpaid</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">318,563</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">280,078</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">274,494</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Piltel(1)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,974,379</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,984,425</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,612,450</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Growth rate of cellular subscribers</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18%</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6%</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48%</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12%</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6%</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">45%</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Piltel(1)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40%</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8%</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">61%</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cellular revenues (in millions)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php77,627</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php74,229</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php72,532</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">75,605</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">71,518</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">66,421</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-right:7.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Cellular handset sales </p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,022</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,711</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,111</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Percentage of cellular
 revenues to total service revenues </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">58%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">59%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:7.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">61%</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:7.0pt;page-break-after:auto' style="margin-top:0;margin-bottom:0">_____________</p>

<p style='line-height:3.0pt' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
0in;margin-left:20.25pt;margin-bottom:.0001pt;text-indent:-20.25pt' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Represents Talk &#145;N Text, a
prepaid service provided by Piltel using Smart&#146;s network. Piltel&#146;s revenue is
net of service fees payable to Smart for using Smart&#146;s network.  Piltel does
not offer postpaid service.</i></p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>Service
Plans</i>.  Smart and its service brands are strong and widely recognized brand
names in the Philippines.  Smart&#146;s approach has been to methodically segment
the market and tailor services and content appropriate to each particular
niche.  One of the best examples of Smart&#146;s successful market segmentation
strategy is <i>Talk &#145;N Text</i>, the brand carried by Smart&#146;s subsidiary,
Piltel.  <i>Talk &#145;N Text</i> is aimed at the lower-income markets with the
objective of serving as a flanker brand against our competition.  Capitalizing
on the Filipino&#146;s love for pop culture, <i>Talk &#145;N Text</i> extensively uses
local celebrities as its endorsers and the vernacular in its advertising and
promotional campaigns.  With approximately seven million subscribers, <i>Talk &#145;N
Text</i> has the third-largest GSM subscriber base in the Philippines.</p>

<p align=left style='margin-top:0in;text-align:left;
text-indent:.5in;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-top:0in;text-align:left;
text-indent:.5in;line-height:normal' style="margin-top:0;margin-bottom:0">On
the postpaid side, we have <i>Smart Gold,</i> which serves the broad postpaid
market, and<i> Smart Infinity,</i>
a premium postpaid plan targeting affluent individuals 35 years and above who
are highly mobile locally and internationally.  <i>Smart Infinity</i> offers
around-the-clock dedicated personal concierge service, international assistance
services, premium handset packages and exclusive lifestyle content.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Voice
Services.  </i>Cellular voice services
comprise local (including Smart-and Piltel-to-fixed lines calls and Smart-and
Piltel-to-other mobile operators calls), national long distance and
international long distance calls.  Voice services remains a major contributor
to revenues, generating a total of Php35,221
million, or 45%, and Php35,444 million, or 48%, of cellular service revenues in
2006 and 2005, respectively.  Local calls continue to dominate outbound traffic
with 67% of all outbound minutes originating from our cellular service.  In
2006, traffic volumes from local calls totaled 3,362 million minutes compared
to 3,658 million minutes in 2005.  National long distance traffic volumes for
2006 stood at 73 million minutes compared to 80 million minutes in 2005.
Outbound international long distance decreased to 2% from 4% in 2005 of total
outbound traffic with 165 million minutes and 169 million minutes generated in
2006 and 2005, respectively.  The ratio of inbound-to-outbound international
long distance minutes was 12.5:1 for 2006, compared to 9.2:1 in 2005.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Text
Messaging Service and Other Value-added Services</i>.  The Philippines cellular market is one of the most text messaging-intensive markets in the
world, totaling approximately a billion text messages per day.  Text messaging
is extremely popular in the Philippines, particularly on the prepaid platform,
as it provides a convenient and inexpensive alternative to voice and e-mail
based communications.  Text messaging also utilizes less network capacity than
voice, thereby increasing network efficiency.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Text
messaging has been one of the key drivers for our cellular subscriber growth.  Strong volume growth in text messaging contributed
significantly to Smart's cellular revenue growth in 2006, generating revenues
of Php34,403 million, an increase of Php3,594 million, or 12%, over 2005.
During 2006, Smart and Piltel's text messaging systems handled over 32,052
million outbound messages&nbsp;on standard SMS services and another 203,669
million messages&nbsp;generated&nbsp;through bucket-priced text services.  This
compares to 40,781 million outbound messages on standard SMS services in 2005
and 52,373 million outbound messages generated through bucket-priced text
services.  Unlimited and bucket-priced SMS services were only made available in
March 2005.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">In 2005, Smart launched a series of promotions to test
the market demand for fixed rate or &#147;bucket&#148; plans for voice and text.  Bucket
pricing promotions have now become a key driver for subscriber activations and
usage stimulation.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">In addition, in 2006, Smart focused on segmenting its
market by offering sector-specific, value-driven packages providing a fixed
number of messages with prescribed validity periods.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
success of text messaging is a strong indicator of future data usage potential
in this market.  In 2006, approximately 51% of Smart&#146;s cellular revenues were
derived from data usage, compared to 48% in 2005.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Smart
has recognized early the importance of diversified and innovative products and
services as a competitive advantage in gaining and retaining market share as
well as improving profitability.  Smart has diversified its wireless data
revenues beyond text messaging and leads the market in terms of enhanced data
services.  Its catalog of innovations include the award-winning <i>Smart Money</i>
(a mobile cash card) and <i>Smart Load</i> (an over-the-air electronic loading
facility), both of which were honored by the World GSM Congress in 2001 and
2004, respectively, as &#147;Most Innovative Service for Consumers.&#148;  <i>Smart Load</i>
has revolutionized the mobile industry with its adaptation of the &#147;sachet&#148;
concept in consumer goods to air time reloads.  The concept has since been
emulated by other Asian operators and is regionally referred to as &#147;micro
prepaid reloads&#148;.  Smart subsequently introduced <i>Pasa Load</i>, a derivative
service of <i>Smart Load</i>, which allows for air time load transfers between
subscribers.  Smart also offers the following value-added cellular services:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:49.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Mobile Banking</i>, launched in collaboration with various banks, allows
subscribers to execute banking transactions such as balance inquiries and
transfers over their mobile telephones; </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:49.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Smart Money, </i>launched in conjunction with MasterCard, enables
subscribers to pay for their purchases by transferring money from their bank
accounts to their Smart Money cards as well as reload their prepaid cards
electronically; and</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:49.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Smart Padala</i>, one of the many innovative initiatives from our <i>Smart
Money</i> platform, is the first cash remittance service through text and is
faster and cheaper than traditional remittance arrangements.  It was launched
initially as an international remittance service for overseas Filipino workers
but is now available for domestic remittances as well.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
also offer value-added services such as voice mail, information-on-demand,
which is a service that allows subscribers to order information from our
content providers whenever desired, <i>TextMail</i>, which is a service that
allows subscribers to send and receive text messages through their personal
computers and location-based services, and <i>Voice Text</i>, which allows subscribers
to record a voice message of up to 30 seconds and send it as a text message.
In addition, Smart has a number of interactive activities, such as text games
and chat services, developed on its own platforms.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Consistent
with Smart&#146;s objective to develop new businesses, Smart introduced in 2006 a
&#147;fixed wireless&#148; broadband service under the brand <i>SmartBro</i> to
complement PLDT&#146;s DSL in areas that are currently not covered by the fixed line
network.  <i>SmartBro </i>is rapidly increasing network coverage in order to
retain &#147;first mover&#148; advantage in areas with limited or no fixed line or
broadband coverage.  <i>SmartBro</i> is also pioneering a shared access model
in order to propagate broadband and address affordability barriers.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Also, Smart rolled out <i>Smart Click</i>, a chain of
mobile Internet caf&#233;s.  <i>Smart Click</i> Internet caf&#233;s are housed in
air-conditioned 40-foot container vans designed to provide remote communities
with high-speed, wireless Internet access nationwide.  <i>Smart Click</i> has
established 19 mobile Internet caf&#233;s as at December 31, 2006.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Due
to the high level of text messaging service usage, we believe that the
Philippine market is well suited for text-based informational and e-commerce
services.  Our current approach is to continue maximizing our GSM, or 2G,
services while upgrading our network to Enhanced Data for GSM Evolution, or
EDGE.  EDGE is a technology that would further increase the speed and data capability
of our GSM network.  In addition, on December 29, 2005, Smart was awarded a 3G
license by the NTC after being ranked highest by the NTC in garnering a perfect
score on a 30-point grading system designed to gauge the capability of
telecommunication operators to effectively provide extensive 3G services.  As a
result of the perfect ranking, Smart received the largest radio frequency
allocation of 15 MHz as well as first choice of frequency spectrum.  Smart
chose the 1920-1935 MHz and 2110-2125 MHz spectrum, the range that would best
enable it to rapidly deploy its 3G network nationwide and at the same time
offer the highest quality of 3G service.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Smart further expanded its roster
of services with the commercial launch of its 3G services in May 2006.  These
services include video calling, video streaming, high speed Internet browsing
and special 3G content downloads, each offered at rates similar to those of 2G
services, and make Smart the first mobile operator in the Philippines to offer 3G services to the public.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK14"></a><a name="OLE_LINK13"><i>Rates
and Discounts</i></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our current policy is to
recognize a prepaid subscriber as &#147;active&#148; only when the subscriber activates
and uses the SIM card and reloads it at least once during the month of initial
activation or in the immediately succeeding month.  A prepaid cellular
subscriber is disconnected if the subscriber does not reload within four months
after the full usage or expiry of the last reload.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Our
prepaid cards are sold in denominations of Php300, Php500 and Php1,000,
respectively.  The stored value of a prepaid card generally remains valid for a
period of two months from the time a subscriber activates the card.  In 2003,
we introduced <i>Smart Load</i>, an &#147;over-the-air&#148; electronic loading facility,
which allows consumers to reload prepaid cards with denominations ranging from
Php10 to Php 300 and with different expiration periods depending on the
denomination of the reload. Moreover, <i>Pasa Load</i>, a derivative service,
allows prepaid subscribers to transfer even smaller denominations to other prepaid
subscribers.  Our prepaid subscribers are charged between Php5.50 per minute and
Php6.50 per minute for calls within our wireless network and between Php5.50 per
minute and Php6.50 per minute for calls terminating to other cellular or fixed
line networks.  Voice tariffs on our various prepaid voice packages range from
a low of Php5.50 for four 15-second on-net calls to Php20 for three 3-minute
on-net calls, valid for one day.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-top:0in;text-align:left;
text-indent:.5in;line-height:normal' style="margin-top:0;margin-bottom:0">We
offer both flat rate, or regular, and consumable postpaid plans with monthly
service fees ranging from Php500 to Php8,000.  These plans are available with varying amounts of free air
time and text messages and different rates beyond the free minutes and text
messages, depending on the monthly service fee.  Monthly service fees for flat
rate, or regular, plans are applicable only to local calls and text messages
and for consumable plans to all voice calls, text messages (both local and
international) and value-added services.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Smart
is permitted to adjust its cellular air time and national direct dial rates
according to changes in the peso-to-U.S. dollar exchange rate.  Under the
authorization granted to Smart by the NTC, Smart is permitted to increase and
is required to decrease its air time and national direct dial rates by 1% for
every Php0.25 change in the exchange rate relative to a base rate of Php24.726
to US$1.00.  However, Smart has not implemented any foreign currency
adjustments to its rates since November 4, 1998 because of the concern that
increased rates may result in decreased usage or switching to other cellular
providers by its subscribers.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">All
Smart subscribers pay an international
direct dialing rate of US$0.40 per minute.  This rate applies to 201
destinations, including the United States, Hong Kong, Japan, Singapore, the United Kingdom and the United Arab Emirates.  Smart charges US$0.98 per minute
for 27 other destinations and US$2.18 per minute for another ten destinations.
</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
also launch from time to time various promotions to stimulate usage and subscriber
growth.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
sell our cellular services primarily through a network of independent dealers
and distributors that generally have their own retail networks, direct sales
forces and sub-dealers.  We currently have nine major dealers, two of which are
exclusive.  These dealers include major distributors of cellular handsets whose
main focus are telecommunications outlets.  Account managers from our sales
force manage the distribution network and regularly update these business
partners on upcoming marketing strategies, promotional campaigns and new
products introductions.  With the introduction of <i>Smart Load</i> in May
2003, Smart moved into a new realm of distribution.  These over-the-air
reloads, which were based on the &#147;sachet&#148; marketing concept of consumer goods
such as shampoo and ketchup, required a distribution network that approximates
those of fast-moving consumer goods companies.  Starting with just 50,000
outlets when it was launched, <i>Smart Load</i>&#146;s distribution network now
encompasses over 800,000 retail agents, 80% of which are micro businesses
(e.g., neighborhood stores, individual entrepreneurs, individual roving
agents).  These micro-retailers must be affiliated with any of Smart&#146;s
authorized dealers, distributors, sub-dealers or agents.  With the prepaid
reloading distribution network now extended to corner store and individual
retailer levels and minimum reloading denominations as low as Php10, Smart&#146;s
prepaid service becomes even more affordable and accessible to subscribers.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">For
prepaid services, we grant discounts to dealers for prepaid phone kits, air
time cards and over-the-air reloads sold.  Smart and Piltel compensate dealers with
Php800 in cash per prepaid phone kit sold.  An additional 1% discount based on
the suggested retail price is given on cash purchases.  Air time cards and
over-the-air reloads are sold to distributors at volume discounts determined by
the value of the cards purchased by the distributors.  Discounts given for air
time cards sold range from 8% to 8.4% while discounts on over-the-air reloads
range from 2.5% to 5%.  Air time cards cannot be returned or refunded and
normally expire within six to 12 months after release from the Smart warehouse.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Wireless Broadband, Satellite, VSAT and Other Services</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Overview</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">We currently provide wireless
broadband, satellite, VSAT and other services through Mabuhay Satellite and
Telesat, ACeS Philippines, our satellite phone service provider, Smart
Broadband, our wireless broadband provider, and Wolfpac, our wireless content
operator.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Mabuhay
Satellite</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_DV_M4792"></a>Mabuhay
Satellite is engaged in the control and operation of the Agila II satellite.
Commencing commercial operations in January 1998, Agila II is the Philippines' first communication satellite.  Mabuhay Satellite leases satellite space segments
in both the C and Ku bands on Agila II.  Through Agila II, Mabuhay Satellite
also offers Internet backbone access, video and data broadcasting, and
bandwidth-on-demand, facilitating communication links between
telecommunications, broadcast and other public utility companies operating in
the Asia-Pacific region.  In 2006, Mabuhay Satellite generated revenues of
Php1,157 million and posted a net loss of Php1,499 million.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Telesat</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><a
name="_DV_M4799"></a><a name="_DV_M4801"></a><a name="_DV_M4803"></a><a
name="_DV_M4806"></a>Telesat operates a nationwide communications satellite
network using VSAT technology.  Telesat offers voice, facsimile and data
transmission services throughout the Philippines, including areas that are
underserved or unserved by local fixed line operators.  In 2006, Telesat
generated revenues of Php9 million and posted a net loss of Php51 million.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Using VSAT technology, we also provide the following
services:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:49.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
point-to-multipoint data
transmission services, usually for intercompany communication for corporate
customers;</p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:49.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:49.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
private point-to-point services;
and</p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:49.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:49.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
connectivity for the cell sites of
our wireless network in outlying locations.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
lease transponder capacity on Agila II satellite to provide VSAT services.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>ACeS
 Philippines</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">ACeS
 Philippines currently owns approximately 36.99% of AIL.  In 2006, ACeS
Philippines generated revenues of Php430 million and posted a net income of
Php159 million.  AIL aims to develop and implement a satellite-based
communications system to provide services to users in the Asia-Pacific region
through the Garuda I satellite, or ACeS System and ACeS Service.  AIL has
entered into interconnection agreements and roaming service agreements with
PLDT and other major telecommunications operators that will allow ACeS service
subscribers to access GSM terrestrial cellular systems in addition to the ACeS system.
Further, AIL has an Air Time Purchase Agreement, or ATPA, with National Service
Providers in Asia, including PLDT.  For further discussion regarding the ATPA,
please see Item 5. &#147;Operating and Financial Review and Prospects &#151; Liquidity
and Capital Resources &#151; Contractual Obligations and Commercial Commitments &#151;
Contractual Obligations &#151; Unconditional Purchase Obligations &#151; Air Time
Purchase Agreement with AIL&#148; below and<i> Note 16 &#150; Related Party Transactions</i>
to the accompanying consolidated financial statements in Item 18.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">As part of the consolidation process of the PLDT
Group&#146;s wireless business, ACeS Philippines&#146; operations has been integrated
into Smart.  This operational integration effectively gives Smart the widest
service coverage in the Philippines through the combination of ACeS Philippines
satellite phone service and Smart&#146;s cellular service.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Smart Broadband</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Smart
Broadband is engaged in providing wireless broadband and data services to
residential consumers as well as small and medium-scale enterprises in the Philippines.  As of December 31, 2006, Smart Broadband had 121,867 wireless broadband
subscribers, of which 120,659 residential subscribers are under the brand name <i>Smart
Bro (</i>formerly <i>Smart WiFi)</i>.  <i>Smart Bro</i> aims to strengthen
Smart&#146;s position in the wireless data segment and complements PLDT&#146;s <i>myDSL</i>
service in areas where the latter is not available.   </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>Smart
Bro</i> offers two packages for its wireless broadband service:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:49.5pt;margin-bottom:.0001pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Smart Bro</i> Plan 999, which is geared towards consumers and
provides Internet speeds of up to 384 kbps; and</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:49.5pt;margin-bottom:.0001pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Smart Bro</i> Computer Station Plan 2600, which is geared
towards entrepreneurs and includes a monthly subscription, hardware, software and
merchandising materials.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Wolfpac</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">Wolfpac is primarily engaged in the
business of consumer mobile applications software development and consumer
mobile content development and other allied services.  Wolfpac is one of the
leading content providers and the only Philippine content provider to have been
nominated twice at the annual GSM Congress for successes in application
developments.  Wolfpac generated revenues of Php7 million and posted a net loss
of Php119 million in 2006.  It aims to provide Smart to have a direct link to
the content development community, a key differentiator in wireless
communication service.  The company has various agreements with third parties
for musical compositions, original sound recordings, original movies, caller
ringtune and other services.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>PLDT
WeRoam</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
also offer <i>PLDT WeRoam, </i>or<i> WeRoam</i>, a wireless broadband service
offering running on Smart's nationwide wireless network (using GPRS, EDGE and WiFi
technologies) and PLDT's extensive IP infrastructure.&nbsp;&nbsp;<i> WeRoam</i>&nbsp;provides
workers and remote offices, of large, medium and small businesses, with
continuous wireless data connectivity from wherever the users may be to their
corporate headquarters&#146; Intranet and/or the global Internet.  In
addition,&nbsp;we expanded&nbsp;the <i>PLDT Innovation Laboratory</i>, or <i>PLDT
Innolab</i>, in Manila in partnership with the leading technology companies in
the country.&nbsp; With the expanded <i>PLDT Innolab</i>, more clients as well
as people from the academe and government can now be accommodated and can
experience more on-line industry solutions.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
February 2006, <i>WeRoam</i> introduced a prepaid option with bundled laptops featuring
easy payment plans in alliances with PC vendors across the country.  In July
2006, <i>WeRoam</i> also made higher speed wireless broadband available to the
market with the launch of the <i>WeRoam 3G/HSDPA</i> service.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Revenues</i></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our wireless broadband, satellite, VSAT and other
service revenues consist of:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:7.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
lease payments from the rental of
Mabuhay Satellite's C-band and Ku-band transponders; </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:7.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues generated from Telesat's
nationwide satellite network; </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:7.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues generated from ACeS Philippines&#146;
satellite phone service;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:7.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:63.0pt;text-indent:-27.0pt' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues generated from Smart
Broadband&#146;s wireless broadband and data services; and </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:7.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues generated from Wolfpac
for wireless data content.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Rates</i></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Mabuhay
Satellite leases its transponders to third parties at average annual rates of
approximately US$0.9 million and approximately US$0.7 million for its C-band
and Ku-band transponders, respectively.  Telesat provides its VSAT services on
a cost plus mark-up basis.  ACeS service mobile subscribers are charged
Php13.84 per minute for local and cell-to-cell calls and for national direct
dial services, while residential subscribers are charged peak-hour rates of
Php13.00 per minute and off-peak hour rates of Php8.00 per minute for domestic
calls regardless of destination.  For ACeS system public calling offices,
callers are charged Php4.50 and Php7.00 per minute for calls terminating to
fixed line and cellular networks, respectively.  Rates for international long
distance calls depend on the country of termination and range from US$0.35 per
minute for frequently called countries to US$0.85 per minute for less
frequently called countries.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:.5in;
margin-bottom:.0001pt;text-indent:0in' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></h4>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart
Broadband offers its wireless broadband and data services for residential
consumers as well as small and medium-scale enterprises.  The wireless
broadband service for residential consumers is branded as <i>Smart Bro</i> and
offers a maximum speed of 384 kbps for Php999 per month.  Monthly service fees
for corporate data services range from Php2,200 to Php48,000 depending on the
connection speed requirements.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Wolfpac generates revenues from
SMS subscriptions, institutional services and downloadable contents.  The
subscription price for the SMS subscription and institutional services is
pegged at Php2.50 per SMS, while downloadable contents range from Php10.00 to
Php45.00.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>WeRoam</i>
postpaid offers several packages for its wireless broadband service that
include unlimited Internet access with speeds ranging from 40 kbps to 1.8 Mbps
with monthly recurring fees of Php1,000 to Php1,700 depending on the type of
plan selected.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>WeRoam
</i>prepaid offers several packages that include the GPRS/EDGE card and an air
time value for three, six and 12 months with monthly subscription fees based on
an initial air time value ranging from Php10,860 to Php20,940.  Once the
initial air time value expires, continued use of the service requires <i>WeLoad</i>
or reloading of additional air time value with different denominations and
expiration periods.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc75779203"><b><i>Fixed
Line</i></b></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
provide local exchange, international long distance, national long distance,
data and other network and miscellaneous services under our fixed line business
segment.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Local Exchange Service</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Overview</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our
local exchange service, which consists of our basic voice telephony business,
is provided primarily through PLDT.  </p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table summarizes key measures of our
local exchange service segment as at and for the years ended December 31, 2006,
2005 and 2004:</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Years Ended
 December 31,</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Number of fixed  line subscribers (at year-end)(1)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,776,647</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,842,507</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,834,306</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Number of fixed line employees (at year-end)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">8,711</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">9,197</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">9,692</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Number of fixed line subscribers per employee</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">204</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">200</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">189</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Total local exchange revenues (in millions)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php16,993</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php20,229</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php20,606</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin:0in;margin-bottom:.0001pt;text-indent:
 0in' style="margin-top:0;margin-bottom:0">Local exchange revenues as a percentage of
 total service revenues </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">13%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">16%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">17%</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin:0in;margin-bottom:.0001pt;text-indent:
 0in' style="margin-top:0;margin-bottom:0">Local exchange revenues as a percentage of
 total fixed line service revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">35%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">41%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">42%</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:0in' style="margin-top:0;margin-bottom:0">____________</p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0"><i>(1) Previously set forth as
number of fixed lines in service, this was restated in 2006 to reflect the effect
of the change in parameters used to align with the PLDT Group&#146;s policy on
subscriber count with the planned use of an integrated billing system for our
subscribers.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">We also provide local exchange services through our
subsidiaries ClarkTel, SubicTel, Maratel and Piltel.  Together, these
subsidiaries account for approximately 4% of our consolidated fixed line
subscribers.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
regularly adjust our rates and introduce new products and services in an effort
to increase our number of subscribers, improve our churn management efforts and
minimize our credit risk exposure.  Since 1999, we have launched a prepaid
fixed line service, introduced additional value-added services, introduced
initiatives aimed at increasing subscription in areas where we have excess capacity
and reduced our installation fees, as described below in the &quot;&#151;
Rates&quot; section below.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Initially intended as an alternative affordable
telephone service for consumers under difficult economic conditions, our
prepaid fixed line services now form an important part of PLDT&#146;s overall churn
and credit risk exposure management and subscriber retention strategy.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Rates</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, basic monthly charges for our local exchange service in
the Metropolitan Manila area were Php594.17 for a single-party residential line
and Php1,237.27 for a single business line.  Monthly charges vary according to
the type of customer (business or residential) and location, with charges for
urban customers generally being higher than those for rural/provincial customers.
Regular installation charges amount to Php1,999 for residential customers and
Php3,500 for business customers.  New products launched on promotion or
products bundled on existing services usually waive the installation fee or
allow for a minimal installation fee of Php500.  Other than basic monthly
charges, we do not charge our postpaid subscribers for local calls.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Pursuant
to a currency exchange rate mechanism authorized by the NTC, we adjust our
monthly local exchange service rates according to changes in the peso-to-U.S.
dollar exchange rate.  Under the authorization granted to us by the NTC, we are
permitted to increase and are required to decrease these rates by 1% for every
Php0.10 change in the exchange rate relative to a base exchange rate of Php11
to US$1.00.  In 2006, we implemented eight downward adjustments and three
upward adjustments in our monthly local service rates.  During 2005, we
implemented three upward and six downward adjustments in our monthly local
exchange service rates.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
the first quarter of 2005, House Bill No. 926 was filed and is now pending in
the House of Representatives of the Philippines.  The proposed bill provides
for the cancellation of the currency exchange rate mechanism currently in
place.  If this bill is passed into law or if the NTC issues guidelines to
change the basis of the currency exchange rate mechanism, our ability to
generate U.S. dollar linked revenues from our local exchange business could be
adversely affected.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Our
prepaid fixed line customers generally do not pay a basic monthly charge and
are charged based on usage.  Prepaid fixed line customers are generally charged
based on usage at a rate of Php1.00 per minute for local calls.  Subscribers of
<i>TelePwede</i>, our upgraded prepaid fixed line service, are charged a
monthly fee of Php115 per month to receive incoming calls and are charged per
usage for outgoing calls with varying charges depending on the destination and
network of termination.  The international and national long distance rates we
charge to our prepaid fixed line customers are similar to the rates we charge to
our postpaid customers.  (For a detailed description of these rates, see &#147;&#151;
International Long Distance Service &#151; Rates&#148; and &#147;&#151; National Long Distance
Service &#151; Rates.&#148;)  Prepaid phone kits, each containing Php500 worth of
pre-stored call credits, are sold for Php1,900 per unit.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>International Long Distance Service</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Overview</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our international long distance
service consists of voice and packet-based voice and data services that go
through our international gateway facilities.  We also generate international
long distance revenues through access charges paid to us by other Philippine
telecommunications carriers for incoming international voice calls that
terminate to our local exchange network.  Our packet-based voice and data
services are transmitted over our existing traditional circuits, VoIP systems
and the network of a consortium of dominant Asian carriers in which PLDT is a
member.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
following table shows certain information about our international long distance
business as at and for the years ended December 31, 2006, 2005 and 2004:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Years Ended
 December 31,</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total call volumes (million minutes)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,177</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,266</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,373</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inbound call volumes (million minutes)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,984</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,117</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,216</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Outbound call volumes (million minutes)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">193</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">149</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">157</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inbound-outbound call ratio</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10.3:1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14.2:1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14.1:1</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total international long distance
 service revenues (in millions)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,933</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php12,245</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php12,804</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">International long distance service revenues as a
 percentage of total service revenues </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">11%</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">International long distance service revenues as a
 percentage of <br>
 total fixed line service revenues</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">20%</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">25%</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">26%</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">International
long distance service historically has been a major source of our revenue.
However, due to the steep decline in inbound termination and collection rates
and intense competition, revenues derived from our international long distance
service have been declining.  We adopted a two-pronged initiative in early 2000
with respect to inbound international service to try to address this issue.
First, we lowered our inbound termination rates at that time; by reducing our
rates, we reduced the incentive for unauthorized traffic termination and bypass
routings by toll bypass operators, and therefore were able to recover some lost
traffic; and secondly, we intensified our efforts to identify and contain
unauthorized traffic termination and bypass through more effective monitoring
of our international trunks, leased lines and local network.  International
simple resale operation occurs when a company rents an international leased
line from a Philippine international gateway operator, aggregates traffic
outside the Philippines and carries and terminates this traffic at the local public
switch telephone network in the Philippines.  This termination of other
unauthorized and international simple resale can be used to bypass the local
access charge system and is illegal in the Philippines.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
are more selective in accepting incoming traffic from new and startup carriers,
particularly second and third tier international carriers.  In addition, we
adopted a policy requiring prepayment from certain second and third tier
international carriers as a prerequisite for accepting their incoming traffic.
</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
are also pursuing a number of other initiatives to further strengthen our
inbound business.  Through PLDT Global, we aggregate inbound call traffic to
the Philippines at our points of presence and, using our capacity in submarine
cable systems connected to each point of presence, transmit calls to our
network.  PLDT Global is also enhancing the presence of PLDT in other
international markets by offering new products and services such as
international prepaid cards, mobile services, SMS transit and other global
bandwidth services.  We believe these strategies will help us maximize the use
of our existing international facilities, and develop alternative sources of
revenue.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">To stimulate call volume growth and prevent further
erosion in our share of outbound international call traffic, we have introduced
a number of marketing initiatives, including substantial cuts in international
direct dialing rates, innovative pricing packages for large accounts and
loyalty programs for some customers.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The table below sets forth the net settlement amounts
for international calls handled by PLDT, by country, for the years ended
December 31, 2006, 2005 and 2004:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Net
 Settlement</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Years Ended
 December 31,</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">United States</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$54</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">USS$75</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$75</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Saudi Arabia</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">27</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Canada</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">United Arab Emirates</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Japan</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">25</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Italy </p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Hong Kong</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Kuwait</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taiwan</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=right style='text-align:right;page-break-after:avoid;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0">31</p>
 </div>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=right style='text-align:right;page-break-after:avoid;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0">31</p>
 </div>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=right style='text-align:right;page-break-after:avoid;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0">64</p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:double windowtext 2.25pt;padding:0in 0in 1.0pt 0in'>
 <p align=right style='text-align:right;page-break-after:avoid;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0">US$185</p>
 </div>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:double windowtext 2.25pt;padding:0in 0in 1.0pt 0in'>
 <p align=right style='text-align:right;page-break-after:avoid;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0">US$215</p>
 </div>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:double windowtext 2.25pt;padding:0in 0in 1.0pt 0in'>
 <p align=right style='text-align:right;page-break-after:avoid;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0">US$230</p>
 </div>
 </td>
 </tr>
</table></center></div>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;text-align:justify;
page-break-after:auto' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Rates</i></h6>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Since
February 1, 2003, a substantial portion of PLDT&#146;s international inbound traffic
terminating on its fixed line network is charged US$0.12 per minute.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Rates
for outbound international long distance calls are based on type of service,
whether operator-assisted or direct-dialed.  Our rates are quoted in U.S.
dollars and are billed in pesos.  The peso amounts are determined at the time
of billing.  We charge a flat rate of US$0.40 per minute to retail customers
for direct-dialed calls, applicable to all call destinations at any time on any
day of the week.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
September 15, 2005, we introduced <i>PLDT ID-DSL</i>, a service that allows
overseas calls for registered <i>myDSL</i> plan subscribers using a regular
PLDT fixed line or a voice pad dialer for as low as US$0.10 per minute or
US$0.08 per minute, respectively, depending on a particular subscriber&#146;s DSL
plan.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">To
address the market&#146;s demand for low-priced international calls, PLDT enhanced the
<i>Budget Card</i>, a prepaid call card, offering a reduced IDD rate of Php5
per minute as a promotional offer starting September 24, 2005 for calls to 89
overseas destinations including the United States, Canada, Japan and China<i>.</i>  Beginning March 4, 2006, the <i>Budget Card</i> IDD rates have been further
adjusted to Php3, Php5 and Php8 per minute, depending on the destination, and
now permits calls to 100 overseas destinations.  <i>Budget Cards</i> are sold
in denominations of Php200 and Php100 and must be consumed within 30 days from
first use.</p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>National Long Distance
Service</i></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Overview</i></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
national long distance services are provided primarily through PLDT.  This
service consists of voice services for calls made by our fixed line customers
outside of their local service areas within the Philippines and access charges
paid to us by other telecommunications carriers for calls carried through our
backbone network and/or terminating to our fixed line customers.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows our national long distance
call volumes and revenues as at and for the years ended December 31, 2006, 2005
and 2004:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Years Ended
 December 31,</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total call volumes (million minutes)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,251</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,348</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,930</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total national long distance service revenues
 (in millions)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php6,920</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php5,254</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php6,736</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">National long distance service revenue
 as a percentage of total service revenues </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5%</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4%</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6%</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">National long distance service revenue
 as a percentage of fixed line service revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14%</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">A substantial portion of our national long distance
calls were direct-dialed calls.  Operator-assisted calls are charged based on a
minimum of three minutes plus operator charges, while direct-dialed calls are
charged on a less costly per minute basis. Cellular substitution and the
widespread availability and growing popularity of alternative, more economical
non-voice means of communications, particularly e-mailing and cellular text
messaging, have negatively affected our national long distance call volumes.
The integration of some of our local exchanges into a single local calling
area, as approved by the NTC, has also negatively affected our national long
distance call volumes and, consequently, our revenues.  Because of this
integration, calls between two exchanges located within the same province are
no longer considered national long distance calls but are treated as local
calls.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Rates</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rates for national long distance calls are based on
type of service, such as whether the call is operator-assisted or
direct-dialed.  In line with its move towards rate simplification, PLDT
simplified these rates to a flat rate of Php4.50 per minute effective November
2, 2001.  At the same time, PLDT simplified its rates for calls terminating to
cellular subscribers from a range of Php10.00 per minute to Php16.00 per minute
to a uniform rate of Php13.75 per minute.  Effective
March 1, 2003, PLDT increased the rate for calls terminating to other local
exchange carriers from a flat rate of Php4.50
per minute to Php5.00 per minute.  In
addition, NDD calls originating from and terminating
to PLDT was also adjusted to Php5.00 per
minute from a flat rate of Php4.50 per minute
effective June 8, 2003.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
addition, PLDT launches from time to time promotions, such as flat rate
promotions for unlimited calls from PLDT subscribers terminating to PLDT and
Smart and <i>Talk &#145;N Text</i> subscribers, to stimulate fixed line usage.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
January 7, 2006, the Php10 per call to PLDT, Smart and <i>Talk &#145;N Text </i>subscribers
promotion was made permanent with an optional Php50 monthly service fee for
those who may want to avail themselves of the service.  The offer introduced a permanent
shift from &#147;per minute&#148; charging and allows PLDT fixed line subscribers access
to approximately 26 million PLDT, Smart and <i>Talk &#145;N Text</i> subscribers at
a lower rate.  The Php10 per call offer for calls to Smart and <i>Talk &#145;N Text</i>
subscribers was capped, limiting enrollees to those who registered on or before
February 24, 2006.  PLDT fixed line subscribers, however, can still register
and avail themselves of the unlimited Php10 per call service for national long
distance calls within the PLDT network.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
continue to evaluate the present rate structure of fixed line from per minute
toll charges to single rate for unlimited calls.  This is envisioned to make fixed
line rates competitive with VoIP rates and to revitalize interest in fixed line
usage.  We continue studying various pricing models in respect of the above new
rate plan.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
currently has interconnection arrangement with the majority of other local
exchange carriers, pursuant to which the originating carrier pays: (1) a
hauling charge of Php0.50 per minute for short-haul traffic or Php1.25 per
minute for long-haul traffic to the carrier owning the backbone network; and
(2) an access charge of Php1.00 per minute to the terminating carrier.  PLDT
still maintains revenue-sharing arrangements with a few other local exchange
carriers, whereby charges are generally apportioned 30% for the originating
entity, 40% for the backbone owner and the remaining 30% for the terminating
entity.  For more information on these interconnection arrangements, see &#147;&#150;&#150;
Interconnection Agreements.&#148;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Data and Other Network Services</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our data and other network service revenues include
charges for leased lines, IP-based, packet-based and switched-based services.
These services are used for domestic and international communications such as
private networking, broadband and narrowband Internet-based data
communications, and packet-based communication.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following table shows our data and other network service revenues for the years
ended December 31, 2006, 2005 and 2004:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Years Ended
 December 31,</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Consolidated data and other network
 service revenues (in millions)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php13,725</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php10,394</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php7,114</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Number of DSL broadband subscribers</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">133,159</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">88,811</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48,289</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Number of PLDT Vibe narrowband
 subscribers</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">297,250</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">266,703</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">257,325</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Recognizing the growth potential of data and other
networking services, including IP-based services, and in light of their
importance to our business strategy, we have been putting considerable emphasis
on this service segment.  In 2005, this segment registered the highest
percentage growth in revenues among our fixed line services and continued to
grow in 2006.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
continuous upgrading of our network using next-generation facilities and the
completion of our domestic fiber optic backbone has enabled us to offer a
growing range of value-added and broadband services.  With this and other
technological upgrades, our infrastructure has developed from a traditional
voice facility to a new packet-switched and IP-based network allowing faster
transmission of voice, video and data.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">IP-based
products are bannered by <i>PLDT DSL</i> (<i>myDSL</i> and <i>BizDSL</i>), <i>PLDT
Vibe</i> and I-Gate.  <i>PLDT DSL</i> broadband Internet service is targeted
for heavy individual Internet users as well as for small and medium
enterprises, while <i>PLDT Vibe</i>, or PLDT&#146;s dial-up/narrowband Internet
service, is targeted for light to medium residential individual Internet
users.  I-Gate, our dedicated leased line Internet access service, on the other
hand, is targeted for enterprises and value-added service providers.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
2006, we continued to broaden our service offerings with the launch of new
services and with the expansion or enhancement of some of our existing services.
</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
June 2006, we introduced <i>Shops.work Unplugged</i>, or SWUP, to address the
need of retailers and banks for real-time wireless data communication using
Smart&#146;s GPRS/EDGE network and PLDT&#146;s private VPN network.  SWUP is a bundled
solution that offers wireless VPN connections in response to retailers&#146;
cashiering point-of-sale networking requirements, the need for back-up remote
connections to bank automated teller machines, or ATMs, and merchants&#146; swipe
card terminal access needs.  Retailers will now be able to reach out to a
bigger market in areas where physical connections are unavailable, expand the
banking system with wireless ATMs and release swipe card terminals to more
merchants.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
support of the growing data requirements of the small and medium enterprise
market, the network footprints of BRAINS, IP-VPN, <i>Shops.work </i>and <i>Shops.work
Unplugged</i>, or <i>SWUP. </i> PLDT&#146;s private local networking services, have
been expanded with the roll-out of NGN facilities in key business areas across
the country.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
continued growth in data services revenues can be attributed to several product
offerings.  The steady demand for dedicated connectivity or private networking
from the corporate market using PLDT&#146;s traditional international and domestic
data offerings, including, among others, Fibernet, Arcstar, Acacia, I-Gate,
Diginet, BRAINS, IP-VPN and <i>Shops.work</i>, continues to provide us with a
stable revenue source.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Meanwhile,
Digital Network, or Diginet, our domestic private leased line service, has been
providing Smart&#146;s increasing fiber optic and leased line data requirements.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a name="_Toc75779204"></a><a
name="_Toc46082263"><b><i>Information and
Communications Technology</i></b></a></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
conduct our information and communications technology, or ICT, businesses
through our wholly-owned subsidiary ePLDT.  ePLDT is a broad-based integrated
information and communications technology company, focusing on infrastructure
and solutions for Internet applications, Internet protocol-, or IP-, based
solutions and multimedia content delivery.  ePLDT's principal businesses are
the operation of (a) call centers through Vocativ, Parlance and <i>Ventus</i>,
(b) BPO, through SPi, (c) an Internet data center under the brand name <i>Vitro</i>&#153;,
and (d) Internet and online gaming through Infocom, netGames, Digital Paradise,
Digital Paradise Thailand, Level Up! and Airborne Access.  Our ICT segment
registered revenues of Php6,890 million, Php3,305 million and Php2,401 million,
accounting for 5%, 3% and 2% of our consolidated operating revenues for the
three years ended December 31, 2006, 2005 and 2004, respectively.  The increase
in the revenue contribution from our information and communication technology
segment was primarily due to the consolidation of SPi, CyMed and Level Up!
since their acquisition by ePLDT on July 11, 2006, August 11, 2006 and April
30, 2006, respectively, and is expected to increase going forward with the
full-year consolidation of SPi.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">&nbsp;</h6>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Call Centers</i></h6>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">We are focused on developing our call
center business which capitalizes on the availability of English-speaking
college graduates in the Philippines with a strong customer service
orientation.  ePLDT has established one umbrella brand name, <i>ePLDT Ventus</i>,
for all of its call center businesses, including Vocativ and Parlance.  <i>Ventus
</i>provides offshore, cost-effective contact center outsourcing solutions
specializing in inbound customer care.  Vocativ provides customer and technical
support to its clients in the Philippines, U.S. and U.K., while Parlance
provides the exclusive customer support and billing requirements to one of the
largest direct-to-home satellite television providers in the U.S.  In aggregate, we own and operate approximately 5,600 seats with 5,130 customer service
representatives, or CSRs, as at December 31, 2006 compared to approximately
3,350 seats with 3,625 CSRs as at December 31, 2005.  In 2006, <i>ePLDT Ventus</i>
launched two new sites bringing our total call center site count to seven as at
December 31, 2006.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Business process outsourcing</i></h6>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">ePLDT
acquired a 100% equity interest in SPi and its direct and indirect Philippine
and offshore subsidiaries for a total cash consideration of US$135 million on
July 11, 2006.  SPi is one of the leading pure-play BPO company and the ninth
largest independent BPO service provider worldwide.  It has operations in 19
locations in North America, Europe and Asia.  On August 11, 2006, SPi acquired
100% of CyMed, a leading medical transcription company based in Richmond, Virginia, and on April 16, 2007, SPi acquired 100% of Springfield Service
Corporation, one of the ten largest players in the medical billing and revenue
cycle management market.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Data</i><i> Center</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">ePLDT
operates <i>Vitro</i>&#153;, one of the Philippines' first Internet data centers.
The Philippine Board of Investments granted <i>Vitro</i>&#153; pioneer status, which
entitles it to tax and other governmental incentives.  <i>Vitro</i>&#153; is a
CISCO-certified co-location service provider.  <i>Vitro</i>&#153; provides
co-location, web and server hosting, hardware and software maintenance
services, website development and maintenance services, webcasting and
webhosting, shared applications, data disaster recovery and business continuity
services, intrusion detection and Internet protocol security services, as well
as firewall and managed firewall services.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Internet and Online Gaming </i></h6>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">ePLDT&#146;s
Internet and online gaming business is conducted through several subsidiaries.  ePLDT
owns a 99.6% interest in Infocom, one of the country's leading Internet service
providers, or ISPs.  Infocom offers consumer prepaid Internet access under the
name <i>WarpSpeed</i> and <i>Speed Tipid</i> and postpaid Internet access;
dedicated dial-up and multi-user dial-up corporate leased lines; broadband
Internet access through DSL and cable; and website consulting, development and
hosting.  ePLDT also owns a 75% interest in Digital Paradise, an Internet caf&#233;
business with over 182 branches which assumed the assets of Netopia Computer
Technologies, Inc. and the brand <i>Netopia.  </i>ePLDT further holds an
80%-interest in netGames, a publisher of Massively Multi-player Online Games in
the Philippines, and is the Philippine licensee of <i>Khan Online</i>, the
country&#146;s first full 3D online game; a 51% interest in Airborne Access, the
country&#146;s leading operator of WiFi hotspots, which provides wireless Internet
access in hotspots equipped with Airborne Access WiFi access points and a 60%
equity interest in Level Up!, a leading publisher of online games in the
Philippines with about an 80% share of the online gaming market.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc75779205"></a><a name="_Toc46082265"></a><a
name="_Toc170286149"></a><a name="_Infrastructure"></a><b>Infrastructure</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Wireless Network Infrastructure</i></b><b><i> </i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Cellular</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Through
Smart, we operate a digital GSM network.  To meet the growing demand for
cellular services, Smart has implemented an extensive deployment program for
its GSM network covering substantially all of Metro Manila and most of the
other population centers in the Philippines.  In 2006, Smart has 42 mobile
switching centers, 61 text messaging service centers and 6,099 base stations in
operation after having added 117 base stations to its nationwide cellular
network in 2006.  As at December 31, 2006, Piltel has six active cell sites.</p>

<p align=left style='margin-top:0in;text-align:left;
text-indent:.5in;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-top:0in;text-align:left;
text-indent:.5in;line-height:normal' style="margin-top:0;margin-bottom:0">Smart has an operating spectrum of 7.5 MHz in the 900 band
supporting both its GSM and previously its ETACS network and 20 MHz in the 1800
band for GSM and 15 MHz in the 3G band for W-CDMA.  Its dual-band GSM network
allows it to efficiently deploy high capacity 1800 MHz base transceiver
stations in dense urban areas while its 900 MHz base transceiver stations can
be much more economically deployed in potentially high growth, but less densely
populated provincial areas.  The 3G network revolutionizes mobile technology by providing
more capacity, faster data rates and richer data and video applications.  Its
initial deployment is seen as feasible in urban areas where there is a demand
for mobile broadband applications and where 3G mobile units are more likely to
be available.  Spectrum constraints
will not affect the Smart&#146;s expansion plans for GSM in the foreseeable future.
Piltel, on the other hand, has an operating spectrum of 11.5 MHz out of the
12.5 MHz allocated in the 800 MHz band.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-top:0in;text-align:left;
text-indent:.5in;line-height:normal' style="margin-top:0;margin-bottom:0">Due to its access to PLDT&#146;s network assets, Smart has been
able to achieve significant capital expenditure savings, which are understood
to be significantly less, on a per net addition basis, than its current
competitors.  This translates into an improved ability to price competitively
and target the mass market subscriber base in the Philippines, while retaining
profitability.  Based on existing equipment purchase contracts, Smart expects
incremental capital expenditure per net additional subscriber to amount to less
than US$50. </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
coming years will see continued increases in coverage (particularly indoor), as
well as new types of BTS for outdoor, street level and commercial office
coverage. Smart has introduced the Nokia <i>ConnectSite </i>GSM solution for
wider coverage and increased efficiencies in underserved areas of the Philippines.  The new base station equipment called <i>ConnectSite</i> can be up to 25%
more efficient than traditional outdoor cell sites.  Smart is one of the very
first operators in the world to adopt this solution.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart was awarded a 3G license by the NTC on December
29, 2005.  Smart received the largest radio frequency allocation of 15 MHz as
well as first choice of frequency spectrum.  Smart chose the 1920-1935 MHz and
2110-2125 MHz spectrum, the range that would best enable it to rapidly deploy
its 3G network nationwide and at the same time offer the highest quality of 3G
service.  Smart has commenced its 3G network roll-out and continues to extend
the reach of its 3G network in various cities and municipalities nationwide,
further improving coverage in major urban centers and selected provincial
areas. </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart
and Piltel have been co-locating their cell sites where their base stations are
installed.  As at <br>
December 31, 2006, 36 of Smart's mobile switching centers and 193 of Smart's
cell sites were housed in PLDT&#146;s fixed line complexes while 242 of Smart&#146;s cell
sites were co-located with Piltel.  These operational synergies have allowed
Smart to reduce switch installation time from three months to five weeks.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Wireless Broadband, Satellite, VSAT and Other Services</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Smart
Broadband operates a nationwide broadband wireless Internet data services.  It
is operating in the 2.4, 3.5 and 5.7 Ghz spectrum, supporting its WiFi, Canopy
and eventually WiMax services, respectively.  It offers fixed wireless
broadband Internet connectivity to both residential and corporate clients. It
also maintains and operates WiFi hotspots installations that serve mobile Internet
users.  Almost 2,500 of Smart&#146;s base stations are now wireless
broadband-capable, covering most of the key cities and the other populated
centers in the country.  These are strategically co-located in the Smart&#146;s
cellular base stations that allow it to reach as many subscribers as possible,
in the fastest possible way.  For its backbone, it uses the nationwide PLDT and
Smart fiber optic and IP backbone that provide substantial bandwidth capacity
to utilize and to grow on demand. </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Mabuhay
Satellite controls and operates the Agila II satellite, which has 30 C-band
transponders and 24 Ku-band transponders covering the Asia-Pacific region, the
Indian subcontinent and Hawaii.  Of the 54 transponders, six have restricted
usage due to satellite interference.  Through Agila II, Mabuhay Satellite
offers Internet service, video and data broadcasting, and bandwidth-on-demand,
facilitating communication links between telecommunications, broadcast and
other public utility companies operating in the Asia-Pacific region.  In
December 2000, Agila II joined the U.S. FCC's &quot;Permitted Space
Station&quot; list, which permits U.S.-owned and operated earth stations in
Hawaii to access Agila II for transpacific telecommunications, data, video and
Internet-over-satellite traffic and vice versa.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Telesat
operates a national communications satellite network using VSAT technology to
provide voice, facsimile, video and data transmission services to areas in the
country that are still underserved or unserved by local telephone operators.
Telesat leases transponder capacity from Agila II to provide VSAT services such
as multipoint-to-multipoint and point-to-multipoint data transmission services,
private point-to-point service, and connectivity for the cell sites of our cellular
network in outlying locations.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">ACeS
 Philippines manages, controls and operates its own satellite gateway and
other ground infrastructure, including a 13-meter feeder-link C-band earth
station, beam congruency antenna and equipment that serve as the primary
interface between the ACeS system and other telecommunications networks.  It
uses the Garuda I satellite to provide digital voice services to ACeS
Philippines&#146; mobile and fixed terminal users within the Asian service area.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc75779206"><b><i>Fixed
Line Network Infrastructure</i></b></a></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Domestic</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
domestic telephone network includes installed telephones and other equipment on
customers&#146; premises, local access lines connecting customers to exchanges,
referred to as &#147;outside plant,&#148; inter-office lines connecting exchanges, and
long distance transmission equipment.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table gives some basic measures of the
development of our domestic telephone network as at December 31, 2006, 2005 and
2004:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p style='page-break-after:avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0">December 31,</p>
 </div>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </div>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Number of central office exchanges</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">184</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">183</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">183</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Number of fixed line subscribers(1)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,776,647</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,842,507</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">1,834,306</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Employees per 10,000 local exchange subscribers</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">50</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:0in' style="margin-top:0;margin-bottom:0">_____________</p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>(1) Previously set forth as number of fixed lines in
service, this was restated in 2006 to reflect the effect of the change in
parameters used to align with the PLDT Group&#146;s policy on subscriber count with
the planned use of an integrated billing system for our subscribers.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
have our own 6,400-kilometer domestic fiber optic network, or DFON, the
country's first telecommunications network using fiber optics in delivering
voice, video, data, and other broadband and multimedia services nationwide.
Our fiber optic network employs synchronous digital hierarchy technology to
improve network performance and reduce operating costs.  Our network is
composed of in-land and submarine cable installations and is configured in
seven self-healing rings allowing route delivery even in the event of single
link failure per ring.  To date, the PLDT DFON is equipped with N x 10 gigabits
per second capacity and is connected directly to four existing international
submarine cable systems.  We use the <i>CS VEGA </i>(formerly<i> CS PLDT)</i>,
a cable ship that we lease from NTT World Engineering Marine Corporation
pursuant to a two-year renewal, entered into in January 2006, to a five-year
Chartered Arrangement Maintenance Contract that expired in August 2005 to
maintain the 2,400 kilometers of submarine cable comprising the submerged
portion of our DFON.  </p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
are currently upgrading our fixed line facilities to NGN, a broad term for
certain emerging computer network technologies that can encompass voice, data
and video where all information is efficiently transmitted via digital packets
of data.  It is a platform that will allow for more services to be made
available to our fixed line subscribers.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>International</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">We provide international network services using our
three international gateway switching exchanges.  As of December 31, 2006, our
international long distance facilities allow direct correspondence with 49
countries/territories (representing 89 correspondents) and can reach 420
foreign destinations (via direct and transited routes including breakouts)
worldwide.  We also own interests in submarine and satellite systems, through
which we route most of our international traffic.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
table below shows the submarine cable systems in which we have interests and
the countries or territories they link:</p>

<p style='text-indent:.5in;line-height:7.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:8.1pt'>
 <p style='page-break-after:avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Cable System</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p style='page-break-after:avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Countries Being Linked</b></p>
 </div>
 </td>
 </tr>

 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">G-P</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Guam and the Philippines</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Asia-Pacific Cable Network</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Korea, Japan, Hong Kong, Taiwan, Australia, Philippines, Singapore, Malaysia, Indonesia and Thailand</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Asia-Pacific Cable Network 2</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Philippines, Hong Kong, Japan, Korea, Malaysia, Singapore, China and Taiwan</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Transpacific Cable No. 5</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Guam, Japan, Hawaii and the U.S. Mainland</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">SEA-ME-WE-3</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Japan, Korea, China, Taiwan,
 Hong Kong, Macau, Philippines, Vietnam, Cambodia, Brunei, Malaysia,
 Singapore, Indonesia, Australia, Thailand, Myanmar, Sri Lanka, India,
 Pakistan, United Arab Emirates, Oman, Djibouti, Saudi Arabia, Egypt, Cyprus,
 Turkey, Greece, Italy, Morocco, Portugal, France, UK, Belgium and Germany</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">PacRim East</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Hawaii and New Zealand</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Americas Cable 1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">U.S. Mainland, U.S. Virgin Islands, Brazil, Trinidad and Venezuela</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">China-U.S. Cable</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Japan, China, Taiwan, Korea, Guam and U.S. Mainland</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Columbus II Cable</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">U.S. Mainland, Italy, U.S. Virgin Islands, Mexico, Portugal and Spain</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">FLAG Cable</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Japan, Korea, China, Hong
 Kong, Malaysia, Thailand, India, United Arab Emirates, Saudi Arabia, Egypt,
 Italy, Spain and UK</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">RJK Cable</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Russia, Japan and Korea</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Southern Cross Cable</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">U.S. Mainland, Hawaii, Fiji, Australia and New Zealand</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">TAT 12/13 Cable</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">U.S. Mainland, UK and France</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">TVH Cable</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Thailand, Vietnam and Hong Kong</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">EAC Cable</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Japan, Hong Kong, Korea, Taiwan, Singapore and the Philippines</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">PC-1, Japan-U.S. Cable and
 TGN</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Japan and the U.S.</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Additionally, on May 2, 2007, a consortium of seventeen
major international telecommunication operators, including PLDT, signed an
agreement to build the first high-bandwidth optical fiber submarine cable system
linking Southeast Asia and the U.S.&nbsp; The cable project, known as the <i>Asia-America
Gateway,</i> will span 20,000 kilometers and will use the latest Dense Wavelength
Division Multiplexing technology to provide upgradeable, future proof
transmission facilities that will support bandwidth requirements for new and
revolutionary broadband applications.&nbsp; It is expected that the <i>Asia-America
Gateway</i> will cost approximately US$500 million (of which US$50 million represents
PLDT&#146;s investment) and will be ready for service by the end of 2008.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286150"></a><a name="_Toc75779207"></a><a
name="_Toc46082266"></a><a name="_Interconnection_Agreements"></a><b>Interconnection Agreements</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Since the issuance of Executive Order No. 59 in 1993,
which requires non-discriminatory interconnection of Philippine carriers'
networks, we have entered into bilateral interconnection arrangements with
other Philippine fixed line and cellular carriers.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">For
local calls originating from PLDT and terminating to the cellular networks of
Smart and Globe, Smart and Globe charged PLDT a rate of Php4.50 per minute
effective January 1, 2002.  Effective January 1, 2004, calls terminating to
cellular subscribers originating from fixed line subscribers are charged a
termination rate of Php4.00 per minute, a decrease from the previous Php4.50
per minute.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Effective January 1, 2003, local access for cellular
operators, including Smart, that terminate calls to PLDT&#146;s fixed line network
increased from Php2.00 per minute to Php2.50 per minute, which further
increased to Php3.00 per minute effective January 1, 2004.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Under
a separate agreement between PLDT and PAPTELCO, PLDT is the transit facility
provider between Smart, Globe, other local exchange carriers, or LEC, operators
and PAPTELCO.  PAPTELCO is comprised of 48 LEC and operating in 144 major
telephone exchanges nationwide.  Transit traffic is a service by PLDT to Smart,
Globe, other LEC operators and PAPTELCO members where PAPTELCO members have no
direct interconnection with either Smart, Globe and other LEC operators.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Effective
February 1, 2003, international calls terminating to PLDT&#146;s fixed line network
were charged a termination rate of US$0.12 per minute, an increase from the
previous rate of US$0.08 per minute.  Also, international calls terminating to
Smart&#146;s cellular network were charged a termination rate of US$0.16 per minute,
an increase from the previous termination rate of US$0.12 per minute.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Effective
January 1, 2002, Smart charged a termination rate of Php4.00 per minute for
calls originating from/terminating to another cellular operator&#146;s network.  For
SMS originating from Smart and terminating on other operators&#146; cellular network
and for SMS originating from other operators and terminating on Smart&#146;s
cellular network, the charge is Php0.35 per message.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286151"></a><a name="_Toc75779208"></a><a
name="_Toc46082267"></a><a name="_Licenses_and_Regulation"></a><b>Licenses and Regulation</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT,
Smart and Piltel provide telecommunications services pursuant to legislative
franchises that currently expire, in the case of PLDT, on November 28, 2028, in
the case of Smart, on March 27, 2017 and, in the case of Piltel, on May 14,
2019.  A franchise holder is required to obtain operating authority from the
NTC to provide specific telecommunications services.  These approvals may take
the form of a Certificate of Public Convenience and Necessity, or CPCN, or,
while an application for a CPCN is pending, a provisional authority to operate.
Provisional authorities are typically granted for a period of 18 months.  The
Philippine Revised Administrative Code of 1987 provides that if the grantee of
a license or permit, such as a CPCN or provisional authority, has made timely
and sufficient application for the extension thereof, the existing CPCN or
provisional authority will not expire until the application is finally decided
upon by the administrative agency concerned.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT
operates its business pursuant to a number of provisional authorities and CPCNs,
the terms of which will expire at various times between now and 2028.  PLDT's
CPCNs to provide services to most of the Metropolitan Manila area, Davao and other Philippine cities expired in 2003.  Although some of PLDT's CPCNs and
provisional authorities have already expired, PLDT filed timely applications
for extension of these CPCNs and provisional authorities prior to their
respective expiration dates and is therefore entitled to continue to conduct
its business under its existing CPCNs and provisional authorities pending the
NTC&#146;s decision on these extensions.  PLDT expects that the NTC will grant these
extensions; however, there can be no assurance that this will occur.  The
period of validity of some of PLDT&#146;s CPCNs which expired on November 28, 2003,
coterminous with the term of its previous franchise under Republic Act No.
6146, has been extended further by the NTC to November 28, 2028, coterminous
with PLDT&#146;s current franchise under Republic Act No. 7082. Motions to extend
the period of validity of the other CPCNs to November 28, 2028 are now pending with the NTC.  See Item 3. &#147;Key Information &#150;&#150; Risks Factors &#151; Risks
Relating to Us &#151; Our business is significantly affected by governmental laws
and regulations, including regulations in respect of our franchises, rates and
taxes.&#148;  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Smart
operates its cellular, international long distance and national long distance
services pursuant to CPCNs, the terms of which will expire upon the expiration
of its franchise.  On August 26, 2002, Smart was granted a CPCN to install,
operate and maintain nationwide global mobile personal communications via
satellite which shall also expire upon expiration of its franchise.  Smart&#146;s
provisional authority to establish, install, maintain, lease and operate an
international private leased circuit was effective until November 6, 2006.
Prior to its expiration, Smart filed for an extension of this provisional
authority on the issuance of the CPCN, which remains pending.  On July 22, 2002, Smart was granted separate CPCNs to operate a cellular mobile telephone
system and an international gateway facility.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">On
December 29, 2005, Smart was awarded a 3G license by the NTC after being ranked
highest in garnering a perfect score on a 30-point grading system designed to
gauge the capability of telecommunication operators to effectively provide
extensive 3G services.  As a result, Smart received the largest radio frequency
allocation of 15 MHz as well as first choice of frequency spectrum.  Smart
chose the 1920-1935 MHz and 2110-2125 MHz spectrum. </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Under the terms of the 3G license, Smart is required
to:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:3.0pt;
margin-left:.5in;text-indent:0in;page-break-after:avoid;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
begin installation and rollout of its
3G network no later than 18 months from the date of the award;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:3.0pt;
margin-left:.5in;text-indent:0in;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
start commercial operations no
later than 30 months from the date of the award; and</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:3.0pt;
margin-left:.5in;text-indent:0in;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
cover at least 80% of provincial
capitals and 80% of chartered cities within five years.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging;text-autospace:
ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Smart is also
required to pay annual license fees of Php115 million based on the 15 MHz
awarded to the Company.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Piltel
is authorized to provide virtually every type of telecommunications service,
including the transmission of voice, data facsimile, audio and video and
information services, in and between provinces, cities and municipalities
throughout the Philippines.  The franchise, which was last amended on May 14,
1992, will expire on May 14, 2019 and may be extended by a legislative act of
the Philippine Congress.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table sets forth the spectrum system,
licensed frequency and bandwidth used by Smart, Piltel and Smart Broadband:</p>

<p style='line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:.9pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Carrier</b></p>
 </div>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Spectrum
 System</b></p>
 </div>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Frequency
 Assignment</b></p>
 </div>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Bandwidth</b></p>
 </div>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">ETACS/GSM 900</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">897.5-905/942.5-950 MHz</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">7.5 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">GSM 1800</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">1725-1730/1820-1825 MHz</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">5.0 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">1730-1732.5/1825-1827.5 MHz</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2.5 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">1735-1740/1830-1835 MHz</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">5.0 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">1745-1750/1840-1845 MHz</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">5.0 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">1780-1782.5/1875-1877.5 MHz</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2.5 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">3G (W-CDMA)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">1920-1935/2110-2125 MHz</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">15.0 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">AMPS/CDMA</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">824-835/869-880 MHz</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">11.0 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">845-846.5/890-891.5 MHz</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">1.5 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Smart Broadband</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Wireless broadband</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">2400-2483.5 MHz *</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">73 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">3400-3590 MHz *</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">94 MHz</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">5470-5850 MHz *</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">123 MHz</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">__________</p>

<p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>*    Smart Broadband frequency assignments on these
bands are non-contiguous and on a per station and location basis.</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Operators
of international gateway facilities and cellular telephone operators, pursuant
to Executive Order No. 109, are required to install a minimum number of local
exchange lines.  Of these new lines, operators are required to install one
rural exchange line for every ten urban exchange lines installed.  Smart and
Piltel were required to install 700,000 and 400,000 lines, respectively, and
each has received a certificate of compliance from the NTC.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT,
Smart and Piltel are required to pay various permit, regulation and supervision
fees to the NTC.  PLDT is currently engaged in disputes with the NTC over some
of the assessed fees.  For more information on the disputes involving PLDT, see
Item 8. &#147;Financial Information &#150;&#150; Legal Proceedings &#150;&#150; NTC supervision and
regulatory fees, or SRF.&#148;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">On
May 27, 1998, Smart filed an Urgent Ex Parte Motion and Manifestation regarding
the permit fee in the amount of approximately Php113 million assessed by the
NTC for the CPCN pertaining to Smart&#146;s Integrated Local Exchange Telephone
Service, Domestic Toll Service and Private Line Service (NTC Case No. 93-482).
Smart contended that the fee should have been calculated on the basis of the
actual local exchange carrier project cost, and that therefore the fee should
be Php70 million.  Although the NTC has not yet resolved this issue, Smart has
already paid Php50 million in respect of this assessment as of the date of
filing this annual report.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">In a letter dated April 12, 2005, the NTC requested
that Smart pay the following permit fees in respect of its CPCNs and
provisional authorities:</p>

<p style='line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:41.4pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:8.1pt'>
 <p style='page-break-after:avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Case No.</b></p>
 </div>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Fee</b></p>
 </div>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:4.0pt'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:4.0pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">93-482</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:4.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php62,510,950</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">94-220</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">878,830</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">96-248</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=right style='text-align:right;page-break-after:avoid;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0">6,815,500</p>
 </div>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <div style='border:none;border-bottom:double windowtext 2.25pt;padding:0in 0in 1.0pt 0in'>
 <p align=right style='text-align:right;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0">Php70,205,280</p>
 </div>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
its letter dated May 13, 2005, Smart reiterated its petition that the basis for
computation of the permit fees should be amended and cited the pendency of its
Urgent Ex Parte Motion and Manifestation in NTC Case No. 93-482.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In order to diversify the ownership base of public
utilities, the Public Telecommunications Policy Act <br>
(R.A. 7925) requires a telecommunications entity with regulated types of
services to make a public offering through the stock exchanges representing at
least 30% of its aggregate common shares by the later of the following:</p>

<p style='line-height:7.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the fifth anniversary of the date
the law became effective; and</p>

<p style='line-height:7.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the fifth anniversary of the date
of the entity&#146;s commencement of commercial operations.</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
and Piltel have complied with this requirement.  As Smart has not conducted a
public offering of its shares by August 2004, the Philippine Congress may
revoke the franchise of Smart for failure to comply with the requirement under
R.A. 7925 to conduct a public offering of its shares by August 2004.  A <i>quo
warranto</i> case may also be filed against Smart by the Office of the
Solicitor General of the Philippines on the ground of violation of R.A. 7925
for the failure of Smart to conduct a public offering of its shares by August
2004.  However, Smart believes that it did not violate the terms of its
franchise by not conducting an initial public offering by August 2004.  Smart
believes that the period stated in R.A. 7925 and in the other legislative
franchises within which to conduct a public offering and listing of shares of
stock of telecommunications companies should be deemed as merely directory and
not mandatory.  The DOJ has rendered an opinion that the three-year period
fixed under the Downstream Oil Industry Deregulation Act of 1998 (R.A. 8479)
for the conduct of the initial public offering of shares in entities engaged in
the oil refinery business should be regarded as merely directory.  Smart
believes that this DOJ opinion should also apply to the period for the conduct
of initial public offering of telecommunications companies.  Moreover, Smart
believes that it should be deemed to have complied with the requirement of
making a public offering of its shares since PLDT owns 100% of the outstanding
shares of Smart.  The purpose of R.A. 7925 in requiring telecommunications
companies to make a public offering of their shares, which is to broaden public
ownership in telecommunications entities, is already realized as PLDT, a
publicly listed company, owns 100% of Smart.  In September 2004, Senate Bill No. 1675 was filed
seeking to amend Section 21 of R.A. 7925.  The bill seeks to declare that a
telecommunications entity shall be deemed to have complied with the requirement
of making a public offering of its shares if two-third of its outstanding
voting stock are owned and controlled directly or indirectly, by a listed
company.  The bill is currently pending in the Philippine Senate.  PLDT regularly evaluates various strategic options
with respect to its capital structure.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
Philippine Congress is considering two bills that relate to the imposition of
franchise tax on telecoms companies.&nbsp; HB No. 1469 proposes to re-impose a
5% franchise tax on gross receipts on telephone and telegraph services in lieu
of the VAT.&nbsp; HB No. 1560 proposes a franchise tax at the rate of 3.5% on
the first year and 7% thereafter on the gross receipts of telecoms and
broadcast companies, in lieu of the VAT.&nbsp; There are also various bills in
Congress which propose to tax telecommunications services, among them, the
imposition of a tax on mobile phone companies on all text entries to text
games; the imposition of a Php0.50 specific tax on each SMS to be borne by the
cellular phone companies; and the imposition of a 10% ad valorem tax on all
cellular phone calls using 3G.</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc75779209"></a><a name="_Toc46082268">&nbsp;</a></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286152"></a><a name="_Competition"></a><b>Competition</b></p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
enactment of the Public Telecommunications Policy Act of the Philippines in March 1995 consolidated the government's various policy issuances governing the
telecommunications industry and reaffirmed, among other things, the policy of
liberalizing the industry and opening up the telecommunications market to new
entrants.  Including us, there are nine major local exchange carriers, seven
international gateway facility providers and five cellular service providers in
the country.  Many new entrants into the Philippine telecommunications market
have entered into strategic alliances with foreign telecommunications
companies, which provide them access to technological and funding support as
well as service innovations and marketing strategies.  Consequently, we are
facing increasing competition in major segments of the telecommunications
industry, particularly data and other network services segments.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Cellular Service</i></p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">There
are presently six operating service providers, namely Smart, Piltel, Globe,
Islacom, Digitel and Express Telecom.  Globe acquired Islacom (now known as <i>Innove</i>)
to form into one operating group, while Smart and Piltel, both being part of
the PLDT Group, formed another operating group.  These two operating groups
have approximately 95% of the Philippine cellular market.  The third active
operator, Digitel, commenced its cellular service, <i>Sun
Cellular</i>, on March 29, 2003 and is estimated to have approximately 5% of
the cellular market as at December 31, 2006.  In December 2005, the NTC awarded 3G licenses to
existing cellular operators Smart, Globe, Digitel and to a new entrant,
Connectivity Unlimited Resources Enterprises, or CURE.  The NTC has yet to
award a fifth license to another operator.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Competition
in the cellular industry has intensified with the availability of affordably
priced handsets offering a range of new functions and the introduction by
competitors of new and improved plans for postpaid subscribers, reduced rates
per minute and aggressive marketing and promotional strategies.  The principal
bases of competition are price, including handset cost, quality of service,
geographic coverage and attractiveness of packaged services.  Smart's network
leads the industry in terms of coverage with 6,099 base stations as at December
31, 2006.&nbsp;</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As a
result of competitive pressures, several service providers, including Smart and
Piltel, have recently introduced &#147;bucket&#148; plans providing unlimited voice and
text services, and other promotions.  While most of the &#147;bucket&#148; priced plans
currently available in the market are being offered on promotional bases,
Smart, Globe and Sun Cellular continue to launch other services that are
designed to encourage incremental usage from existing subscribers and also to
attract new subscribers.  </p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cellular operators are also competing actively against each other in
launching innovative products and value-added services.  The growing range of
cellular products and services now include text messaging, multi-media messaging,
voice mail, text mail, international roaming, information-on-demand, mobile
banking, e-commerce, mobile data, cellular Internet access and Internet
messaging.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On February 14, 2006, Smart opened its 3G network in selected key
cities nationwide, making video calling, video streaming, high speed Internet
browsing and special 3G content downloads on its 3G network available to
subscribers with 3G handsets.  Likewise, Globe is currently rolling out its 3G
network.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Consistent with industry practice and Smart&#146;s churn management efforts,
Smart &quot;locks&quot; the handsets it sells to its subscribers, rendering
them incompatible with SIM cards issued by competitors and thereby hindering
them from swapping the existing SIM for a SIM of a competing operator.
However, subscribers can have their handsets &#147;unlocked&#148; by unauthorized parties
for a nominal fee and purchase new SIM cards from competing operators.
&#147;Unlocking&#148; does not involve significant cost.  Switching to another cellular
operator would, however, result in a change of the subscriber&#146;s cellular
telephone number.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">From
October 2003 to May 2005, &#147;SIM-swapping&#148; became a prevalent promotional
activity in the cellular industry.  In &#147;SIM-swapping&#148; promotions, prepaid
cellular subscribers had the ability to switch from one cellular operator to
another by simply exchanging their current prepaid SIM card for another
operator&#146;s SIM card with a certain amount of preloaded air time credits at no
cost.  These &#147;SIM-swapping&#148; activities gave rise to a situation where certain
subscribers regularly swapped their SIM card between cellular operators upon
full use of the pre-stored air time. As a result, our cellular subscriber base
contained a certain number of transient subscribers at any one point in time.
In May 2005, we terminated our &#147;SIM-swapping&#148; promotions; as a result, our
churn rates increased in the third and fourth quarters of 2005, but leveled off
beginning in the first quarter of 2006.   </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Local Exchange Service</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
concerted nationwide local exchange line build-out by various players, as
mandated by the Philippine government, significantly increased the number of
fixed line subscribers in the country and resulted in wider access to basic
telephone service.  The growth of the fixed line market, however, remained weak
due to the surge in demand for cellular services and, in the past, the general
sluggishness of the national economy.  Nevertheless, we have sustained our
leading position in the fixed line market on account of PLDT's extensive
network in key cities nationwide.  In most areas, we face one or two
competitors.  Our principal competitors in the local exchange market are
Digitel, Bayan Telecommunications and Globe.  </p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Over
the past couple of years, however, competition among local exchange operators
has reduced as certain operators have faced financial difficulties or have
shifted strategic focus away from the fixed line business to cellular
services.  On the other hand, we are facing increasing competition from
cellular operators mainly due to substitution of cellular services for fixed
line services.     </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>International Long
Distance Service</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Including
us, there are 11 licensed international gateway facility operators in the
country.  While we have so far been able to maintain a leadership position in
this highly competitive segment of the industry, in recent years, our market
share has reduced largely as a result of (1) competition from other
international gateway facility operators and illegal international simple
resale operators; (2) an increase in inbound and outbound international long
distance calls terminating to and originating from the growing number of
cellular subscribers; and (3) the popularity of alternative and cheaper modes
of communication such as text messaging, e-mail, Internet telephony and the
establishment of virtual private networks for several corporate entities,
further heightening the competition.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">With
respect to inbound calls into the Philippines, we adopted the U.S. FCC
benchmark accounting rate of US$0.38 per minute for inbound international calls
which represented a settlement rate of US$0.19 per minute, one year ahead of
the target date of January 1, 2001.  This provided us with increased
flexibility to terminate more U.S. traffic into the Philippines, minimize
unauthorized traffic termination through international simple resale operations
and recover traffic lost due to bypass routings.  We have also established,
through our wholly-owned subsidiary PLDT Global, presence in key cities
overseas to identify and capture Philippine terminating traffic at its source,
maximize the use of our international facilities and develop alternative
sources of revenue.  Effective February 1, 2003, after lengthy negotiations
with approximately 100 telecommunications operators around the world, we increased
the termination rate with carriers accounting for a substantial portion of our
international inbound traffic terminating on its fixed line network to US$0.12
per minute.  Prior to the increase in termination rates, a substantial portion
of PLDT&#146;s international inbound traffic terminating on its fixed line network
was charged an average termination rate of approximately US$0.08 per minute.
See Item 5. &#147;Operating and Financial Review and Prospects &#150;&#150;Results of
Operations &#150;&#150; 2006 Compared to 2005 &#150;&#150; On Business Segment Basis &#150;&#150; Fixed Line
&#150;&#150; Operating Revenues &#150;&#150; Service Revenues &#150;&#150; International Long Distance
Service&#148; and Item 3. &#147;Key Information &#150;&#150; Risks Factors &#150;&#150; Risks Relating to Us
&#150;&#150; Our results of operations have been, and may continue to be, adversely
affected by competition in international long distance service&#148; for further
discussion.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">With respect to outbound calls
from the Philippines, we compete for market share through our local exchange
and cellular businesses, which are the origination points of outbound
international calls.  We have also introduced a number of marketing initiatives
to stimulate growth of outbound call volumes, including tariff reductions and
volume discounts for large corporate subscribers.  Digitel and Globe have also
launched new pricing schemes to grow their outbound call volumes.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>National Long Distance Service</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our national long distance service business has been negatively
affected by the growing number of cellular subscribers in the Philippines and the widespread availability and growing popularity of alternative economical
non-voice methods of communication, particularly text messaging and e-mail.  In
addition, various ISPs have launched voice services via the net to their
subscribers nationwide.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">While national long
distance call volumes have been declining, we have remained a leading provider
of national long distance service in the Philippines due to our significant
subscriber base and ownership of the Philippines&#146; most extensive transmission
network.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:auto' style="margin-top:0;margin-bottom:0">Data and Other Network Services</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Another rapidly growing segment
of the industry is the market for data and other network services.  The growth
is spurred by the significant growth in consumer/retail narrowband and
broadband Internet access, enterprise resource planning applications, call
centers, BPO, on-line gaming and other e-services that drive the need for
broadband and Internet-protocol based solutions both here and abroad.  Our
major competitors in this area are Globe/Innove, Bayan Telecommunications, Eastern
Telecoms and Digitel.  The principal bases of competition in data services
market are coverage, price, customer service and quality of service.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286153"></a><a name="_Toc75779210"></a><a
name="_Toc46082269"></a><a name="_DV_M5729"></a><a name="_DV_M5730"></a><a
name="_DV_M5731"></a><a name="_DV_M5732"></a><a name="_DV_M5733"></a><a
name="_DV_M5742"></a><a name="_DV_M5743"></a><a name="_DV_M5814"></a><a
name="_DV_M5815"></a><a name="_DV_M4751"></a><a name="_DV_M4753"></a><a
name="_DV_M5824"></a><a name="_DV_M5826"></a><a name="_DV_M5828"></a><a
name="_DV_M5829"></a><a name="_DV_M5830"></a><a name="_DV_M5832"></a><a
name="_DV_M5833"></a><a name="_DV_M4768"></a><a name="_DV_M4769"></a><a
name="_DV_M4770"></a><a name="_DV_M4771"></a><a name="_DV_M4773"></a><a
name="_DV_M4774"></a><a name="_DV_M4775"></a><a name="_DV_M4776"></a><a
name="_DV_M5877"></a><a name="_DV_M4837"></a><a name="_DV_M4840"></a><a
name="_DV_M4841"></a><a name="_DV_M4922"></a><a name="_DV_M4923"></a><a
name="_DV_M4924"></a><a name="_DV_M4949"></a><a name="_DV_M4953"></a><a
name="_DV_M4954"></a><a name="_DV_M4955"></a><a name="_DV_M5991"></a><a
name="_DV_M5993"></a><a name="_DV_M5996"></a><a name="_DV_M5997"></a><a
name="_DV_M5998"></a><a name="_DV_M5999"></a><a name="_DV_M5027"></a><a
name="_DV_M5028"></a><a name="_DV_M5029"></a><a name="_DV_M5030"></a><a
name="_DV_M5066"></a><a name="_DV_M5068"></a><a name="_DV_IPM159"></a><a
name="_DV_IPM160"></a><a name="_DV_IPM161"></a><a name="_DV_IPM162"></a><a
name="_DV_ZIII2255"></a><a name="_DV_IPM163"></a><a name="_DV_M5085"></a><a
name="_DV_M6081"></a><a name="_DV_M6082"></a><a name="_DV_M5101"></a><a
name="_Environmental_Matters"></a><b>Environmental
Matters</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
have not been subject to any material fines or legal or regulatory action involving
non-compliance with environmental regulations of the Philippines.  We are not
aware that we are not in compliance in any material respect with relevant
environmental protection regulations.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286154"></a><a name="_Toc75779211"></a><a
name="_Toc46082270"></a><a name="_Intellectual_Property_Rights"></a><b>Intellectual Property Rights</b></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
do not own any material intellectual property rights apart from our brand names
and logos.  We are not dependent on patents, licenses or other intellectual
property which are material to our business or results of operations, other
than licenses to use the software that accompany most of our equipment
purchases.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK12"></a><a name="OLE_LINK1"></a><a
name="_Toc170286155"></a><a name="_Toc75779212"></a><a name="_Toc46082271"></a><a
name="_Properties"></a><b>Properties</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
own four office buildings located in Makati City and own and operate 184
exchanges nationwide, of which 61 are located in the Metropolitan Manila area.
The remaining 123 exchanges are located in cities and small municipalities
outside the Metropolitan Manila area.  We also own radio transmitting and
receiving equipment used for international and domestic communications.  As at December
31, 2006, we had 4,377 cellular cell sites and 6,099 base stations.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, our principal properties, excluding property under
construction, consisted of the following, based on book values:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
67% consisted of cable, wire and
cellular facilities, including our domestic fiber optic network, subscriber
cable facilities, inter-office trunking and toll cable facilities and cellular
facilities;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
18% consisted of central office
equipment, including three international gateway facilities, six pure national
toll exchanges and 15 combined local and toll exchanges, and our communications
satellite;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
11% consisted of land and
improvements and buildings, which we acquired to house our telecommunications
equipment, personnel, inventory and/or fleet;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
1% consisted of information
origination and termination equipment, including pay telephones and radio
equipment installed for customers use, and cables and wires installed within
customers' premises; and</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
3% consisted of other work
equipment.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">For
more information on these properties, see <i>Note 7 &#150; Property, Plant and
Equipment</i> to the accompanying consolidated financial statements in Item 18.
</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">These
properties are located in areas where our subscribers are being served.  In our
opinion, these properties are in good condition, except for ordinary wear and
tear, and are adequately insured.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
majority of our connecting lines are above or under public streets and
properties owned by others.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT's and Smart&#146;s properties are free from any
mortgage, charge, pledge, lien or encumbrance; however, substantial properties
of Mabuhay Satellite and Piltel are subject to liens while a portion of ePLDT&#146;s
property is subject to liens.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
has various long-term lease contracts, the bulk of which have lease terms
ranging from two to ten years covering certain offices, warehouses,
telecommunications equipment locations and various office equipment.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">For more information on the obligations relating to
these properties and long-term obligations, see <i>Note 21 &#150; Contracual
Obligations and Commercial Commitments </i>to the accompanying consolidated
financial statements in Item 18.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><a name="_Toc170286156">Item 4A.    Unresolved Staff Comments</a></h2>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">None.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286157"></a><a name="_Toc75779213"></a><a
name="_Toc46082272"><b>Item 5.       Operating
and Financial Review and Prospects</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>The
following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our audited consolidated
financial statements (and the related notes) as at December 31, 2006 and 2005
and for the years ended December 31, 2006, 2005 and 2004 included elsewhere in
this report.  This discussion contains forward-looking statements that reflect
our current views with respect to future events and our future financial
performance.  These statements involve risks and uncertainties, and our actual
results may differ materially from those anticipated in these forward-looking
statements as a result of particular factors such as those set forth under
&quot;Forward-Looking Statements&quot; and Item 3. &quot;Key Information &#151; Risk
Factors&quot; and elsewhere in this report.  Our audited consolidated financial
statements, and the financial information discussed below, have been prepared
in accordance with U.S. GAAP.  For convenience, certain peso financial
information in the following discussions has been translated to U.S. dollars at
the exchange rate at December 31, 2006 of Php49.045 to US$1.00, as quoted
through the Philippine Dealing System.</i></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286158"></a><a name="_Toc75779214"></a><a
name="_Toc46082273"><b>Overview</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
are the largest and most diversified telecommunications company in the Philippines.  We have organized our business into three main segments which serve as the
basis for management&#146;s decision to allocate resources and evaluate operating
performance:</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Wireless</i> &#151; wireless
telecommunications services provided by Smart and Piltel, our cellular service
providers; Smart Broadband, our wireless broadband provider; Wolfpac, our
wireless content operator; and Mabuhay Satellite, ACeS Philippines and Telesat,
our wireless broadband, satellite, VSAT and other services operators;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Fixed Line</i> &#151; fixed line
telecommunications services are primarily provided through PLDT.  We also
provide fixed line services through PLDT&#146;s subsidiaries ClarkTel, SubicTel,
Maratel, Piltel and BCC, which together account for approximately 4% of our
consolidated fixed line subscribers, and PLDT Global; and</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Information and Communications
Technology</i> &#151; information and communications infrastructure and
services for Internet applications, Internet protocol-based solutions and
multimedia content delivery provided by PLDT&#146;s subsidiary ePLDT; call center
services provided under <i>ePLDT Ventus</i>, including Ventus, Parlance and
Vocativ; BPO services provided by SPi (consolidated since July 11, 2006);
Internet access and gaming services provided by ePLDT&#146;s subsidiaries, Infocom,
Digital Paradise, Digital Paradise Thailand, netGames, Airborne Access and
Level Up!; and e-commerce, and IT-related services provided by other investees
of ePLDT, as discussed in <i>Note 8 &#150; Investments </i>to the accompanying
consolidated financial statements in Item 18.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Key
performance indicators and drivers that our management uses for the management
of our business include, among others, the general economic conditions in the Philippines, our subscriber base, traffic volumes, and interconnection arrangements.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Wireless</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">We provide cellular and wireless
broadband, satellite, VSAT and other services under our wireless business, with
cellular contributing about 96% and the remaining wireless services
contributing approximately 4% of our wireless service revenues, respectively,
in 2006.  Rapid growth in the cellular market has resulted in a change in our
revenue composition and sources of our revenue growth.  Starting in 2003,
cellular service has been our major revenue source surpassing fixed line
revenues.  As of December 31, 2006, Smart and Piltel, which offer services
using Smart&#146;s network, had the largest and third largest cellular subscriber
bases, respectively, in the Philippines.  In addition, Smart&#146;s and Piltel&#146;s
subscribers increased by 18% in 2006, resulting in our aggregate system-wide
cellular subscribers outnumbering our fixed line in service by more than 14 to
1 at the end of 2006, which was higher than the increases of Smart&#146;s and
Piltel&#146;s subscriber base of 6% in 2005 but lower than the increase of Smart&#146;s
and Piltel&#146;s subscriber base of 48% in 2004.  Cellular data services, which
include all text messaging and text-related services ranging from ordinary text
to value-added services, contributed significantly to our cellular revenue
increase.  Our wireless operating revenues remained stable and accounted for 63%,
62% and 61% of our consolidated operating revenues for each of the years ended
December 31, 2006, 2005 and 2004, respectively.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Fixed Line</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Our
fixed line business provides local exchange service, international and national
long distance services, data and other network services and miscellaneous
services.  Our fixed line operating revenues accounted for 32%, 36% and 37% of our
consolidated operating revenues for the years ended December 31, 2006, 2005 and
2004, respectively.  Local exchange revenues have declined owing to shift in
subscriber preference from postpaid to prepaid service with lower average
revenue per user, or ARPUs.  National and international long distance revenues
have also been declining largely due to a drop in call volumes as a result of
alternative means of communications such as texting, e-mailing and Internet
telephony.  Mitigating these declines was the steady growth of our data and
other network services over the recent years.  Recognizing the growth potential
of the data and other network services segment, we have put considerable
emphasis on the development of new packet-switched, data-capable and IP-based
networks.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Information and
Communications Technology</i></b></p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
conduct our ICT businesses through ePLDT.  ePLDT&#146;s principal businesses are the
operation of an Internet data center under the brand name <i>Vitro</i>TM;
one umbrella brand name, <i>ePLDT Ventus</i>, for all of its call center
businesses, including Ventus, Vocativ and Parlance; BPO provided by SPi
Technologies, Inc., or SPi; Internet and online gaming through Infocom, Digital
Paradise and Digital Paradise Thailand, netGames, Level Up! and Airborne
Access.  The revenue contribution of our information and communications
technology segment accounted for 5% of our consolidated operating revenues for
the year ended December 31, 2006, and 2% of our consolidated operating revenues
for each of the years ended December 31, 2005 and 2004.  The increase in the
revenue contribution from our information and communication technology segment
was primarily due to the consolidation of SPi since its acquisition by ePLDT on
July 11, 2006, and is expected to increase going forward with the full-year
consolidation of SPi.<b> </b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc75779215"></a><a name="_Toc46082274"></a><a
name="_Toc170286159"><b>Critical Accounting
Policies</b></a></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
consolidated financial statements are prepared in accordance with U.S. GAAP,
which requires management to make estimates and assumptions that affect amounts
reported in our consolidated financial statements and related notes.  In
preparing these consolidated financial statements, we have made our best
estimates and judgments of certain amounts, giving due consideration to
materiality.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
believe the following represent our critical accounting policies under U.S.
GAAP.  The impact and any associated risks relating to these policies in our
business operations are discussed elsewhere in this section.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Revenue Recognition</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
revenue recognition policies require us to make use of estimates and
assumptions that may affect the reported amounts of our revenues and
receivables.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
agreements with domestic and foreign carriers for inbound and outbound traffic
subject to settlements require traffic reconciliations before actual settlement
is done, which may not be the actual volume of traffic as measured by us.
Initial recognition of revenues is based on our observed traffic adjusted by
our normal experience adjustments, which historically have not been material to
our consolidated financial statements.  Differences between the amounts
initially recognized and actual settlements are taken up in the accounts upon
reconciliation.  However, there is no assurance that such use of estimates may
not result to material adjustments in future periods.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Revenues
under a multiple element arrangement specifically applicable to our wireless
business are split into separately identifiable components and recognized when
the related components are delivered in order to reflect the substance of the
transaction.  The fair value of components is determined using verifiable
objective evidence.  Revenue for handset sales is quantified and identified
separately using the residual value method from our cellular service revenue.
 </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Estimating Useful Lives of
Property, Plant and Equipment</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
estimate the useful lives of our property, plant and equipment based on the
periods over which our assets are expected to be available for use.  Our
estimation of the useful lives of our property, plant and equipment is based on
our collective assessment of industry practice, internal technical evaluation
and experience with similar assets.  The estimated useful lives of our
property, plant and equipment are reviewed at least annually and are updated if
expectations differ from previous estimates due to physical wear and tear,
technical and commercial obsolescence and legal and other limitations on the
use of our assets.  It is possible, however, that future results of operations
could be materially affected by changes in our estimates brought about by
changes in factors mentioned above.  The amounts and timing of recorded
expenses for any period would be affected by changes in these factors and
circumstances.  A reduction in the
estimated useful lives of our property, plant and equipment would increase our
recorded operating expenses and decrease our noncurrent assets.  Total carrying
values of property, plant and equipment amounted to Php164,081 million and Php173,007
million as at December 31, 2006 and 2005, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:auto' style="margin-top:0;margin-bottom:0">Asset Impairment </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">U.S. GAAP requires that an
impairment review be performed when certain impairment indicators are present.
The impairment review first compares the future undiscounted cash flows
expected to be generated from the continued use and ultimate disposition of the
assets with the book value of the assets.  If these cash flows are not
sufficient to recover the book value of the assets, an impairment charge is
recognized based on the comparison between the discounted value of these cash
flows and the book value of the assets.  In addition, our projections for
future cash flows are generally less during periods of reduced cash flow.  As a
result, an impairment charge is more likely to occur during a period when our operating
results are already otherwise depressed.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Purchase
accounting requires extensive use of accounting estimates and judgments to
allocate the purchase price to the fair market values of the assets and
liabilities purchased.  Our business acquisitions typically result in goodwill,
which is also subject to a periodic impairment test.  Determining the fair
value of property, plant and equipment, investments and intangible assets
requires us to make estimates and assumptions, such as the determination of future
cash flows expected to be generated from the continued use and ultimate
disposition of such assets, that can materially affect our consolidated
financial statements.  Future events could cause us to conclude that property,
plant and equipment, investments and intangible assets associated with an
acquired business are impaired.  Any resulting impairment loss could have a
material adverse impact on our financial condition and results of operations.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The preparation of estimated
future cash flows involves significant judgments and estimations. While we
believe that our assumptions are appropriate and reasonable, significant
changes in our assumptions may materially affect our assessment of recoverable
values and may lead to future additional impairment charges under U.S. GAAP.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Total
carrying values of goodwill and other intangible assets as at December 31, 2006
and 2005 amounted to Php27,241 million and Php16,875 million, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:auto' style="margin-top:0;margin-bottom:0">Financial Assets and Liabilities</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">U.S. GAAP requires that we carry
certain of our financial assets and liabilities at fair value, which requires
extensive use of accounting estimates and judgment.  While significant
components of fair value measurement were determined using verifiable objective
evidence (e.g., foreign exchange rates, interest rates, volatility rates), the
fair value would differ if we utilized different valuation methodology.  Any
changes in fair value of these financial assets and liabilities would directly affect
our consolidated statements of income and equity.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Total fair value of financial assets and
liabilities as at December 31, 2006 amounted to Php35,952 million and Php104,862
million, respectively, while the total fair value of financial assets and
liabilities as at December 31, 2005 amounted to Php43,459 million and Php150,077
million, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>Estimating Allowance for
Doubtful Accounts</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">We estimate the allowance for
doubtful accounts related to our trade receivables based on two methods.  The
amounts calculated using each of these methods are combined to determine the
total amount we reserve.  First, we evaluate specific accounts where we have
information that certain customers are unable to meet their financial
obligations.  In these cases, we use judgment, based on the best available
facts and circumstances, including but not limited to, the length of our
relationship with the customer and the customer&#146;s current credit status based
on third party credit reports and known market factors, to record specific
reserves for customers against amounts due to reduce our receivables to amounts
that we expect to collect.  These specific reserves are re-evaluated and
adjusted as additional information received affects the amounts estimated.  Second,
a provision is established as a certain percentage of operating revenues based
on the aging profile of receivables.  This percentage is based on a collective
assessment of historical collection, write-off experience, current economic
trends, changes in our customer payment terms and other factors that may affect
our ability to collect payments.  Full allowance is provided for receivables
from permanently disconnected subscribers and carriers.  Such permanent
disconnections generally occur within 105 days from the date payment was due.
Partial allowance is provided for active subscribers and carriers based on the
age status of receivables.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
amounts and timing of recorded expenses for any period would differ if we made
different judgments or utilized different estimates.  An increase in our
allowance for doubtful accounts would increase our recorded expenses and
decrease our current assets.  Provision
for doubtful accounts amounted to Php736 million, Php2,251 million and Php3,955
million for the years ended December 31, 2006, 2005 and 2004, respectively.
Trade and other receivables, net of allowance for doubtful accounts, amounted
to Php10,158 million and Php7,856 million as at December 31, 2006 and 2005,
respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Investments</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
various interests that we hold in companies are accounted for under three methods:
 consolidation, equity method and cost method.  The method of accounting
applied to investments involves an evaluation of the significant terms of the
investments that explicitly grant or suggest evidence of control or significant
influence over the operations of the investees.  Consolidated investments
include our controlled subsidiaries.  Investments in businesses which we do not
control but have the ability to exercise significant influence over their operating
and financial policies are accounted for using the equity method.  Investments
in businesses which we do not have the ability to exercise significant
influence over operating and financial policies are accounted for using the
cost method.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Pension Cost and Other Retirement Benefits </i></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
determination of our obligation and cost for pension and other retirement
benefits is dependent on our selection of certain assumptions used by actuaries
in calculating such amounts.  Those assumptions are described in <i>Note 17 &#150;
Employee Benefits </i>to the accompanying consolidated financial statements in
Item 18, and include, among other things, discount rates, expected returns on
plan assets and rates of compensation increases.  In accordance with U.S. GAAP,
actual results that differ from our assumptions are recognized as income or expense
when the net cumulative unrecognized actuarial gains and losses at the end of
the previous reporting period exceeded 10% of the higher of the defined benefit
obligation and the fair value of plan assets at that date.  While we believe
that our assumptions are reasonable and appropriate, significant differences in
our actual experience or significant changes in our assumptions may materially
affect our pension and other retirement obligations.  The accrued benefit cost as at December 31, 2006 and
2005 amounted to Php7,627 million and Php2,421 million, respectively.  SFAS No.
158 &#147;Employees&#146; Accounting for Defined Benefit Pension and Other Post retirement
Plans&#148; which was adopted in 2006 requires the recognition of the unfunded status
of a benefit plan, and therefore no unrecognized net actuarial loss was
recognized as at December 31, 2006.  Unrecognized net actuarial gain as at
December 31, 2005 amounted to Php116 million.  </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:auto' style="margin-top:0;margin-bottom:0">Deferred Tax Assets</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">We review the carrying amounts of our deferred tax
assets at each balance sheet date and reduce these to the extent that it is no
longer probable that sufficient taxable income will be available to allow all
or part of the deferred tax assets to be utilized.  Our assessment on the recognition of deferred tax
assets on deductible temporary differences is based on the forecasted taxable
income of the subsequent reporting periods.  This forecast is based on our past
results and future expectations on revenues and expenses.  Management believes
that we will not have sufficient future taxable income to utilize the benefits
of deductible temporary differences and there is no assurance that we will
generate sufficient taxable income to allow all or part of our deferred tax
assets to be utilized.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006 and 2005, our net deferred tax assets amounted to Php25,366
million and Php23,406 million, respectively, net of valuation allowance
amounting to Php299 million and Php5,732 million, respectively.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Legal Contingencies</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
are currently involved in various legal proceedings.  Our estimate of the
probable costs for the resolution </p>

<p style="margin-top:0;margin-bottom:0">of these claims has been
developed in consultation with outside counsel handling our defense in these
matters and is based upon an analysis of potential results.  We currently do
not believe these proceedings will have a material adverse effect on our
consolidated financial statements.  It is possible, however, that future
results of operations could be materially affected by changes in our estimates
or in the effectiveness of our strategies relating to these proceedings.  See
Item 8. &#147;Financial Information &#151; Legal Proceedings &#151; Taxation.&#148;  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Recently Adopted
Accounting Pronouncements</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Effective
January 1, 2006, we adopted SFAS No. 123 (R), &#147;Share-Based Payment&#148;, which
revises SFAS No. 123. This statement requires an entity to measure the cost of
employee services received in exchange for an award of equity instruments based
on the grant-date fair value of the award and to recognize that cost over the
period that an employee is required to provide service in exchange for the
award.  Any awards of liability instruments to employees would be measured at
fair value at each reporting date through settlement. We adopted SFAS No. 123 (R)
using the modified prospective transition method, and accordingly, the results
of prior periods have not been restated. This method requires that the
provisions of SFAS No. 123 (R) are applied only to unvested share-based awards as
of January 1, 2006. The cumulative effect of adoption of SFAS No. 123 (R) on
prior years resulted in a change in our reported net income of Php189 million
(net of income taxes of Php93 million and Php1.02 per share) in 2006, which
represents the difference between the intrinsic value and the fair value of the
liability award on January 1, 2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In September
2006, the Financial Accounting Standards Board, or FASB, issued SFAS 158,
&#147;Employers&#146; Accounting for Defined Benefit Pension and Other Postretirement
Plans &#150; An amendment of FASB Statements Nos. 87, 88, 106 and 132(R).&#148;  We
adopted SFAS 158 as effective on December 31, 2006.  See <i>Note 17 &#150;&#150; Employee
Benefits</i>.  Additionally, in  September 2006, the U.S. Securities and
Exchange Commission issued Staff Accounting Bulletin, or SAB, No. 108,&#148; Considering
the Effects of Prior Year Misstatements when Quantifying Misstatements in
Current Year Financial Statements.&#148; SAB 108 was effective for us upon adoption
on December 31, 2006. SAB 108 did not have a material effect on our financial
position or results of operations.  Effective January 1, 2006, we adopted FASB
Interpretation, or FIN, No. 47, &#147;Accounting for Conditional Asset Retirement
Obligations, an interpretation of SFAS 143.&#148;  The adoption of SFAS 143 did not
had material effect on our financial position or results of operations in 2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
May 2005, the FASB, as part of an effort to conform to international accounting
standards, issued SFAS 154, &#147;Accounting Changes and Error Corrections&#148;, which
was effective for us beginning on January 1, 2006. SFAS 154 requires that all
voluntary changes in accounting principles be retrospectively applied to prior
financial statements as if that principle had always been used, unless it is
impracticable to do so. When it is impracticable to calculate the effects on
all prior periods, SFAS 154 requires that the new principle be applied to the
earliest period practicable. The adoption of SFAS 154 did not have a material
effect on our consolidated financial statements in 2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>New Accounting
Pronouncements Effective Subsequent to 2006</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In February 2006, FASB issued SFAS 155, &#147;Accounting
for Certain Hybrid Financial Instruments,&#148; an amendment to SFAS 133 and FAS
140.  SFAS 155 permits an entity to elect fair value remeasurement for any
hybrid financial instrument (with changes in fair value recognized in earnings)
if the hybrid instrument contains an embedded derivative that would otherwise
be required to be bifurcated and accounted for separately under SFAS 133.  The
election to measure the hybrid instrument at fair value is made on an
instrument-by-instrument basis and is irreversible.  The statement will be
effective for all financial instruments acquired, issued, or subject to a
remeasurement event occurring after the beginning of an entity&#146;s fiscal years
beginning after September 15, 2006, with earlier adoption permitted as of the
beginning of fiscal year, provided that financial statements for any interim
period of that fiscal year have not been issued.  We are currently in the process of
evaluating any effect of the adoption of FAS 155 will have on our consolidated
financial statements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In June 2006, the EITF reached a consensus on Issue
No. 06-3, &#147;How Taxes Collected from Customers and Remitted to Governmental
Authorities Should Be Presented in the Income Statement (That Is, Gross Versus
Net Presentation)&#148;.  EITF Issue No. 06-3 requires that companies disclose their
accounting policy regarding the gross or net presentation of certain taxes.
Taxes within the scope of EITF Issue No. 06-3 are any tax assessed by a
governmental authority that is directly imposed on a revenue-producing
transaction between a seller and a customer and may include, but is not limited
to, sales, use, value added and some excise taxes.  EITF Issue No. 06-3 is
effective for our reporting period beginning January 1, 2007.  We are currently
in the process of determining the impact of this issue on our consolidated
financial statements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In June 2006, the FASB issued Interpretation No. 48, &#147;Accounting
for Uncertainty in Income Taxes&#148;, or FIN 48, an interpretation of SFAS No. 109,
&#147;Accounting for Income Taxes&#148;.  FIN 48 clarifies the accounting for uncertainty
in income taxes recognized in an enterprise&#146;s financial statements in
accordance with SFAS No. 109, and prescribes a recognition threshold and
measurement attribute for the financial statement recognition and measurement
of a tax position taken or expected to be taken in a tax return.  FIN 48 also
provides guidance on derecognition, classification, interest and penalties,
accounting in interim periods, disclosure and transition.  FIN 48 is effective
for our reporting period beginning January 1, 2007.  We are currently in the
process of determining the impact of the adoption of this Interpretation on our
consolidated financial statements. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In September 2006, FASB issued SFAS 157, &#147;Fair Value
Measurements&#148;.  This statement applies whenever other standards require (or
permit) assets or liabilities to be measured at fair value.  Under this
statement, fair value refers to the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between market
participants in the market in which the reporting entity transacts.  This
statement clarifies the principle that fair value should be based on the
assumptions market participants would use when pricing the asset or liability.
In support of this principle, the standard establishes a fair value hierarchy
that prioritizes the information used to develop those assumptions.  The fair
value hierarchy gives the highest priority to quoted prices in active markets
and the lowest priority to unobservable data, for example, the reporting
entity&#146;s own data.  Under this statement, fair value measurements would be
separately disclosed by level within the fair value hierarchy.  This statement
will become effective for financial statements issued for fiscal years
beginning after November 15, 2007, and with interim periods within those fiscal
years.  Early adoption is permitted.  We are currently in the process of
evaluating the impact of this statement on our consolidated financial
statements. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In September 2006, the Emerging Issues Task Force, or
EITF, reached a consensus on Issue No. 06-1, &#147;Accounting for Consideration
Given by a Service Provider to Manufacturers or Resellers of Equipment Necessary
for an End-Customer to Receive Service from the Service Provider&#148;.  EITF Issue
No. 06-1 provides guidance regarding whether the consideration given by a
service provider to a manufacturer or reseller of specialized equipment should
be characterized as a reduction of revenue or an expense.  This issue is
effective for our reporting period beginning January 1, 2008.  Entities are
required to recognize the effects of applying this issue as a change in
accounting principle through retrospective application to all prior periods
unless it is impracticable to do so.  We are currently in the process of
evaluating the impact of this issue on our consolidated financial statements.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286160"></a><a name="_Toc75779216"></a><a
name="_Toc46082275"><b>Results of Operations</b></a></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">We have reclassified certain accounts in 2005 and 2004
to conform with our 2006 financial statement presentation.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The following table shows the
contribution by each of our business segments to our consolidated operating
revenues, expenses and net income for each of the years ended December 31, 2006,
2005 and 2004.  Most of our revenues are derived from our operations within the
 Philippines.  Our revenues derived from outside the Philippines consist primarily of revenues from incoming international calls to the Philippines.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:98.58%;border-collapse:collapse'>
 <tr style='height:18.9pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:18.9pt'>
 <p align=center style='margin-bottom:0in;margin-bottom:
 .0001pt;text-align:center;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:18.9pt'>
 <p align=center style='margin-left:.25in;text-align:center;
 text-indent:-.25in' style="margin-top:0;margin-bottom:0">Wireless</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:18.9pt'>
 <p align=center style='margin-left:.25in;text-align:center;
 text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:18.9pt'>
 <p align=center style='margin-left:.25in;text-align:center;
 text-indent:-.25in' style="margin-top:0;margin-bottom:0">Fixed
 Line</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:18.9pt'>
 <p align=center style='margin-left:.25in;text-align:center;
 text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:18.9pt'>
 <p align=center style='margin-left:.25in;text-align:center;
 text-indent:-.25in' style="margin-top:0;margin-bottom:0">ICT</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:18.9pt'>
 <p align=center style='margin-left:.25in;text-align:center;
 text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:18.9pt'>
 <p style='margin-left:1.6pt;text-indent:-1.6pt' style="margin-top:0;margin-bottom:0">Inter-segment <br>
 Transactions</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:18.9pt'>
 <p align=center style='margin-left:.25in;text-align:center;
 text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:18.9pt'>
 <p align=center style='margin-left:.25in;text-align:center;
 text-indent:-.25in' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.15in'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=9 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=center style='text-align:center;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">For the year ended December 31, 2006</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Operating
 Revenues </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php80,405</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php49,282</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php6,890</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php9,041)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php127,536</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 text-indent:22.5pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">78,383</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,203</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,337</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(8,919)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">125,004</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 text-indent:22.5pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,022</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">79</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">553</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(122)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,532</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Operating
 Expenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">42,271</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">39,086</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,142</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9,142)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">79,357</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net
 Income (Loss)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">32,918</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">923</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style=';text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(243)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">33,598</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">For the year ended December 31, 2005</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Operating Revenues </p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">76,906</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,472</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,305</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,348)</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">123,335</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='text-indent:22.5pt;line-height:8.0pt' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">74,195</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,431</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,953</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,231)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">120,348</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='text-indent:22.5pt;line-height:8.0pt' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,711</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">352</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(117)</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,987</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt' style="margin-top:0;margin-bottom:0">Operating Expenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">39,436</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38,989</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,253</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,857)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">74,821</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt;line-height:
 8.0pt' style="margin-top:0;margin-bottom:0">Net Income </p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">35,830</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,660</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">113</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E6E6E6;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 line-height:8.0pt' style="margin-top:0;margin-bottom:0">For
 the year ended December 31, 2004</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt' style="margin-top:0;margin-bottom:0">Operating Revenues </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">74,764</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48,546</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,401</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4,538)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">121,173</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='text-indent:22.5pt;line-height:8.0pt' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">68,653</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48,546</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,080</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4,375)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">114,904</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='text-indent:22.5pt;line-height:8.0pt' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,111</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">321</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(163)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,269</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt' style="margin-top:0;margin-bottom:0">Operating Expenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41,598</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">32,027</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,035</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4,026)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">72,634</p>
 </td>
 </tr>
 <tr style='height:10.1pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt;line-height:
 8.0pt' style="margin-top:0;margin-bottom:0">Net Income (Loss) </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">27,559</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,241</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style=';text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(699)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:10.1pt'>
 <p align=right style='text-align:right;line-height:8.0pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b>2006 Compared to 2005</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b>On a Consolidated Basis</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Consolidated Operating
Revenues</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
consolidated operating revenues for 2006 increased by Php4,201 million, or 3%,
to Php127,536 million in 2006 from Php123,335 million in 2005.  This increase was higher than the increase in our
consolidated operating revenues in 2005, primarily due to an increase in our
ICT revenues largely due to the consolidation of SPi, CyMed and Level Up!,
continued increase in our call center revenues and the continued growth of our
wireless business.  The revenue
contribution of our wireless business accounted for 63% and 62% of our
consolidated operating revenues for 2006 and 2005, respectively.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows the breakdown of our
consolidated operating revenues for the years ended December 31, 2006 and 2005
by business segment:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=12 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:1.55pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December
 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=12 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Wireless </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php80,405</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">63</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php76,906</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">62</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php3,499</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Fixed line</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,282</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">39</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,472</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(190)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Information and communications
 technology </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,890</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,305</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,585</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">108</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inter-segment transactions</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9,041)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='text-align:right;text-indent:9.35pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,348)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,693)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php127,536</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php123,335</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,201</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Consolidated Operating Expenses</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our consolidated operating expenses in 2006 increased
by Php4,536 million, or 6%, to Php79,357 million from Php74,821 million in 2005.
The increase was primarly due to higher operating expenses associated with our three
business segments primarily due to an increase in compensation and employee
benefits, primarily resulting from the effect of collective bargaining
agreement-related increases in salaries and benefits, an increase in incentive
plan-related accruals, the consolidation of SPi, CyMed and Level Up!, and
higher accrued bonuses, pension benefits, long-term incentive plan costs and other
employee benefits.  We currently expect these expenses to be significantly
higher going forward as a result of the full year consolidation of SPi, CyMed
and Level Up!.  As a percentage of our consolidated operating revenues,
consolidated operating expenses increased to 62% in 2006 from 61% in 2005.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows the breakdown of our
consolidated operating expenses for the years ended December 31, 2006 and 2005
by business segment:</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=12 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:1.55pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December
 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=12 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Wireless </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php42,271</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php39,436</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,835</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Fixed line</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">39,086</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">38,989</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">97</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Information and communications
 technology </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,142</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,253</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,889</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">120</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inter-segment transactions</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9,142)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(11)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='text-align:right;text-indent:9.35pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,857)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,285)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">33</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php79,357</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php74,821</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,536</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Consolidated Operating Income</i></b></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our consolidated operating income in 2006 was Php48,179
million, a decrease of Php335 million, or 1%, compared to Php48,514 million in
2005 as a result of a 6% increase in our consolidated operating expenses which
more than offset the 3% increase in our consolidated operating revenues.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Consolidated Financing Costs</i></b></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Financing
costs on a consolidated basis decreased by Php964 million, or 28%, to Php2,459
million primarily due to lower interest expense and related items owing to
lower debt balances in 2006 compared with 2005 and lower accretion on financial
liabilities due to lower levels of debt issuance costs, partially offset by lower
foreign exchange gains as a result of lower foreign currency debt levels.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Consolidated Interest
Income</i></b></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Interest
income on a consolidated basis decreased by Php35 million, or 2%, to Php1,422
million in 2006 from Php1,457 million in 2005 mainly attributable to higher levels
of short-term investments which resulted in lower interest income.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Consolidated Loss (Gain)
on Derivative Transactions</i></b></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Loss
on derivative transactions on a consolidated basis amounted to Php6,857 million
in 2006, an increase of Php5,056 million, or 281%, compared to Php1,801 million
in 2005 primarily due to mark-to-market loss from principal only swaps as a
result of the peso appreciation in 2006 and lower interest differential between
peso and U.S. dollar interest rates. </p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Consolidated Other
Income - Net</i></b></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Other
income on a consolidated basis totaled Php3,595 million in 2006, an increase of
Php2,579 million, or 254%, compared to Php1,016 million in 2005.  The increase
was primarily due to the recognition of a gain of Php1,698 million on early
settlement by Piltel of its restructured debt, a gain on disposal of property
and equipment of Php355 million, a gain relating to a refund from Manila
Electric Company, or Meralco, of Php194 million recorded at fair value in 2006
(payable by Meralco over four years) and a gain on disposal of materials.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Consolidated I</i></b><b><i>ncome Before Income Tax, Cumulative Effect of Change
in Accounting Policy and Minority Interest in Net Loss (Income) of Consolidated
Subsidiaries </i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our income before income tax, cumulative
effect of change in accounting policy and minority interest in net loss
(income) of consolidated subsidiaries in 2006 was Php43,828 million, a decrease
of Php1,942 million, or 4%, from Php45,770 million in 2005, primarily due to
the increase of Php5,056 million in loss on derivative transactions in 2006 and
a slightly lower operating income, partially offset by an increase in our other
income due to the recognition of a gain
of Php1,698 million on early settlement by Piltel of its restructured debt
and a significant decline in our financing costs
owing to lower interest expense and related items in 2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Provision for Income Tax</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision
for income tax increased by Php4,197 million, or 87%, to Php9,046 million in
2006 compared to Php4,849 million in 2005 mainly due to lower non-tax
deductible charges, partially offset by
the reversal of a valuation allowance of deferred tax assets in relation with
the likelihood that Piltel would be able to realize the future tax benefits on
these assets.  We currently expect that our effective corporate tax rate will
be higher going forward than in previous years due to the expiration of Smart&#146;s
income tax holiday.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Consolidated Net Income</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As a
result, our consolidated net income in 2006 was Php33,598 million, a decrease
of Php7,005 million, or 17%, compared to Php40,603 million in 2005.  The
following table shows the breakdown of our consolidated net income for the
years ended December 31, 2006 and 2005 by business segment:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:1.55pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December
 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Wireless </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.55pt;text-align:right;
 text-indent:2.65pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php32,918</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">98</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.2pt;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php35,830</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">88</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 text-indent:1.45pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php2,912)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(8)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Fixed line</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.55pt;text-align:right;
 text-indent:2.65pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">923</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.2pt;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,660</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 text-indent:1.45pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,737)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(80)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Information and communications
 technology </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:7.9pt;text-align:right;
 text-indent:2.9pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(243)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.2pt;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">113</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=center style=';text-align:center;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 text-indent:1.45pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(356)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(315)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.55pt;text-align:right;
 text-indent:2.65pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php33,598</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.2pt;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php40,603</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 text-indent:1.45pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php7,005)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(17)</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>On Business Segment Basis</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b>Wireless</b></p>

<p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:22.5pt' style="margin-top:0;margin-bottom:0"><b><i>Operating Revenues </i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our wireless business segment offers cellular services
as well as wireless broadband, satellite, VSAT and other services.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following table summarizes our total operating service and non-service revenues
from our wireless business for the years ended December 31, 2006 and 2005 by
service segment:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:98.98%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=11 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Wireless services:</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:13.2pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service Revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Cellular </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php75,605</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">94</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php71,518</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,087</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Wireless broadband, satellite, VSAT and
 others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,778</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,677</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">101</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #D9D9D9;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">78,383</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">97</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #D9D9D9;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">74,195</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">96</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,188</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Non-service Revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;text-indent:.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Sale
 of cellular handsets and SIM-packs</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,022</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,711</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(689)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(25)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Total
 Wireless Operating Revenues </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php80,405</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php76,906</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,499</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Service
Revenues</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Our wireless service revenues increased
by Php4,188 million, or 6%, to Php78,383 million in 2006 compared to Php74,195
million in 2005 mainly as a result of the continued growth of Smart&#146;s and
Piltel&#146;s subscriber base, an increase in
international inbound revenues and a reduction in domestic interconnection
costs due to a shift from off-network to on-network voice and data usage.  As a
percentage of our total wireless operating revenues, wireless service revenues
increased to 97% in 2006 from 96% in 2005. </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Cellular Service</i></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Unless otherwise indicated, the financial data and
operating metrics cited in the cellular service section reflect the
consolidated results of our cellular subsidiary, Smart and its subsidiary,
Piltel.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Our cellular service revenues consist of:
</p>

<p style='margin-left:.5in;line-height:7.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues derived from actual usage
of the network by prepaid subscribers and any unused peso value of expired
prepaid cards or electronic air time loads, net of discounts given to dealers; </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
monthly service fees from postpaid
subscribers, including: (1) charges for calls in excess of allocated free local
calls; (2) toll charges for national and international long distance calls; (3)
charges for text messages of our service customers in excess of allotted free
text messages; and (4) charges for value-added services, net of related content
provider costs;</p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues generated from incoming
calls and messages to our subscribers, net of interconnection expenses; fees
from reciprocal traffic from international correspondents; and revenues from
inbound international roaming calls for the service; and</p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
other charges, including those for
reconnection and migration. </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our cellular service revenues in 2006 amounted to Php75,605
million, an increase of Php4,087 million, or 6%, from Php71,518 million in 2005.
Cellular service revenues accounted for 94% and 93% of our total wireless
operating revenues in 2006 and 2005, respectively.  The increase in cellular
service revenues was primarily due to the continued growth of Smart&#146;s and
Piltel&#146;s subscriber base.  As at December
31, 2006, Smart and Piltel cellular subscribers totaled 24,175,384, an increase
of 3,766,763, or 18%, over their combined cellular subscriber base of
20,408,621 as at December 31, 2005.  </p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The table below shows our cellular subscribers base as
at December 31, 2006 and 2005:</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:85.22%;margin-left:31.5pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:4.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>As at December 31,</b></p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Cellular subscriber base </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,175,384</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,408,621</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,766,763</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify' style="margin-top:0;margin-bottom:0">Prepaid </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">23,856,821</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">20,128,543</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,728,278</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt' style="margin-top:0;margin-bottom:0">Smart </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,882,442</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,144,118</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,738,324</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,974,379</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,984,425</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,989,954</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify' style="margin-top:0;margin-bottom:0">Postpaid</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">318,563</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">280,078</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">38,485</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Of our 24,175,384 subscribers as at December 31, 2006,
prepaid subscribers accounted for approximately 99% while postpaid subscribers
accounted for the remaining 1%.  Our cellular prepaid subscriber base grew by
19% to 23,856,821 as at December 31, 2006 from 20,128,543 as at December 31,
2005, whereas our postpaid subscriber base increased by 14% to 318,563 as at
December 31, 2006 from 280,078 as at December 31, 2005.  Smart&#146;s prepaid and
postpaid net subscriber activations totaled 1,738,324 and 38,485, respectively,
in 2006, or a quarterly average addition of 434,581 prepaid and 9,621 postpaid
subscribers.  On the other hand, Piltel&#146;s prepaid subscribers increased by 40%
to 6,974,379 as at December 31, 2006 from 4,984,425 as at December 31, 2005, or
a quarterly average addition of 497,489 subscribers.  Postpaid subscribers as
at December 31, 2006 were higher than as at December 31, 2005 primarily due to
increased net activations in the last two quarters of 2006.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our quarterly net subscriber activations (reductions)
over the eight quarters in 2006 and 2005 are as follows:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>1Q</b></p>
 </td>
 <td   style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:5.4pt;text-indent:-5.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2Q</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>3Q</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:4.25pt;text-align:center;
 text-indent:-4.25pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>4Q</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>1Q</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2Q</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>3Q</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.5pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:1.45pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4Q</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.15in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Prepaid</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">486,009</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,553,570</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">450,553</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,238,146</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,050,638</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">536,840</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(11,230)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(381,443)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">111,987</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">851,326</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">131,486</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">643,525</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">920,885</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">314,607</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(53,953)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(358,709)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">374,022</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">702,244</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">319,067</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">594,621</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">129,753</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">222,233</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">42,723</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(22,734)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Postpaid </p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,001</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,955</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,722</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,807</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,357)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">116</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,506</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,319</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   style=' border:none;background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 -9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">491,010</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,565,525</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">464,275</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,245,953</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,044,281</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">536,956</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(724)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(380,124)</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Wireless Broadband,
Satellite, VSAT and Other Services</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our revenues from wireless broadband, satellite, VSAT
and other services consist mainly of rentals received for the lease of Mabuhay
Satellite&#146;s transponders and Telesat&#146;s VSAT facilities to other companies and
wireless broadband service revenues from Smart Broadband, charges for ACeS
Philippines&#146; satellite phone service and service revenues from PLDT Global
subsidiary&#146;s mobile virtual network operations.  Smart Broadband offers a number of wireless broadband services and had
121,867 subscribers as at December 31, 2006.    </p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Gross service revenues from these services for 2006
amounted to Php2,778 million, an increase of Php101 million, or 4%, from Php2,677
million in 2005.  The increase was primarily due to the growth in our wireless
broadband business.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Non-service Revenues</i></p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
wireless non-service revenues consist of:</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
proceeds from sale of cellular
handsets; and</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
proceeds from sale of cellular
SIM-packs.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our wireless non-service revenues decreased by Php689 million,
or 25%, to Php2,022 million in 2006 as compared to Php2,711 million
in 2005 mainly attributable to lower handset sales due to the fact that
activations in 2006 were primarily driven by more SIM-pack sales.  </p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
text-indent:.3in;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Operating Expenses</i></h6>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Operating expenses associated with our
wireless business in 2006 amounted to Php42,271 million, an increase of Php2,835
million, or 7%, from Php39,436 million in 2005.  This increase was mainly due
to increases in rent, compensation and benefits, and the recognition of an
asset impairment charge, partially offset by decreases in costs of cellular
handsets and SIM-packs sold, cost of satellite air time, taxes and licenses,
and selling and promotion.  As a percentage of our total wireless operating
revenues, operating expenses associated with our wireless business decreased to
53% in 2006 from 51% in 2005.   </p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Cellular business expenses accounted for 96% while
wireless broadband, satellite, VSAT and other business expenses accounted for 4%
of our wireless business expenses in 2006, compared to 94% and 6%,
respectively, in 2005.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table summarizes our wireless-related
expenses for the years ended December 31, 2006 and 2005 and the percentage of
each expense item to the total:</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:95.2%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=11 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Wireless services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,743</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,200</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php543</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,887</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,577</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,310</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits(1)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,040</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,245</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">795</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.65pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Costs of cellular handsets and SIM-packs sold</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,688</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,827</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,139)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(20)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.65pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Repairs and maintenance</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,646</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,667</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(21)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,012</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,124</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(112)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,780</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,608</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">172</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Asset
 impairment </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,391</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,391</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Taxes
 and licenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,018</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,538</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(520)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(34)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Communication,
 training and travel</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">891</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">960</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(69)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Insurance
 and security services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">798</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">947</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(149)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(16)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Cost
 of satellite air time</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">698</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,008</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(310)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(31)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision
 for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">627</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">253</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">374</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">148</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Amortization
 of intangible assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">272</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">189</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">83</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision
 for inventory obsolescence</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">202</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">322</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(120)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(37)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Other
 operating expenses</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">578</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">971</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(393)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(40)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Total
 </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php42,271</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php39,436</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,835</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">__________</p>

<p style='margin-left:.25in;text-indent:-.25in;line-height:
3.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>(1)  Includes salaries and
benefits, incentive plan, pension and manpower rightsizing program, or MRP,
costs.</i></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Depreciation
and amortization charges increased by Php543 million, or 6%, to Php9,743 million
in 2006, principally due to an increase in our depreciable asset base mainly in
our broadband and 3G network, and customer-deployed equipment.  For further
details, see <i>Note 7 &#150; Property, Plant and Equipment</i> to the accompanying
consolidated financial statements in Item 18.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Rent expenses increased by Php2,310 million, or 41%,
to Php7,887 million on account of an increase in domestic fiber optic network,
or DFON, facilities leased by Smart from PLDT, as well as higher satellite
transmission and site rental expenses.  As at December 31, 2006, we had 4,377
GSM cell sites and 6,099 base stations, compared with 4,305 GSM cell sites and
5,982 base stations as at December 31, 2005.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Compensation and benefits expenses increased by Php795
million, or 19%, to Php5,040 million, primarily due to higher accrued bonuses,
pension benefits, long-term incentive plan costs and other employee benefits of
Smart.  Smart&#146;s employee headcount increased by 219, or 4%, to 5,306 in 2006
as compared to 5,087 in 2005.  For further discussion on our long-term
incentive plan, please see Item 6. &#147;Directos, Senior Management and Employees
&#150;&#150; Long-Term Incentive Plan&#148; and <i>Note 21 &#150;Employee Benefits</i> to the
accompanying consolidated financial statements in Item 18.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cost
of cellular, handsets, and SIM-packs sold decreased by Php1,139 million, or 20%,
to Php4,688 million primarily due to a decrease in the volume of phone kits
sold and the termination of SIM-swapping activities in May 2005.  </p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Repairs and maintenance expenses decreased by Php21
million, or 1%, to Php3,646 million mainly on account of lower repairs and
maintenance costs for network facilities and motor vehicles which more than offset
higher expenses for electricity and power generation as well as higher
maintenance expense for IT hardware and software.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Selling and promotions expenses decreased by Php112
million, or 4%, to Php3,012 million due to lower commission, and advertising
and promotions expenses as well as a decrease in printing costs of prepaid
cards.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Professional
and other contracted services increased by Php172 million, or 11%, to Php1,780
million, primarily due to increased call center, contracted service, market
research, consultancy and technical service fees.</p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Asset
impairment of Php1,391 million in 2006 represents the reduction in value of
Mabuhay Satellite&#146;s Agila II satellite given the difficulty in generating cash
flows with the satellite nearing its end-of-life and other events affecting its
business.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Taxes
and licenses decreased by Php520 million, or 34%, to Php1,018 million,
primarily due to a decrease in Smart&#146;s licenses and business-related taxes.  </p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Communication,
training and travel expenses decreased by Php69 million, or 7%, to Php891
million due to lower mailing and courier, training, communication and local
travel expenses, partially offset by higher freight and hauling charges
incurred in 2006.</p>

<p align=center style='margin-left:0in;text-align:center;
text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Insurance and security services decreased by Php149
million, or 16%, to Php798 million, primarily
due to the decrease in site security expenses and lower amortization charges on
prepaid insurance contracts.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cost
of satellite air time decreased by Php310 million, or 31%, to Php698 million
due to a reduction of satellite air time cost as a result of the appreciation
of the peso in 2006.  See &#147;&#151; Liquidity and Capital Resources &#151; Contractual
Obligations and Commercial Commitments &#151; Contractual Obligations &#151;
Unconditional Purchase Obligations &#151; Air Time Purchase Agreement with AIL&#148; and <i>Note
16 &#150; Related Party Transactions</i> to the accompanying consolidated financial
statements in Item 18.   </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision
for doubtful accounts increased by Php374 million, or 148%, to Php627 million
primarily due to an increase in the provision for subscriber and carrier
receivables coupled with the reversal of the provision for non-trade
receivables booked in 2005.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Amortization
of intangible assets increased by Php83 million, or 44%, to Php272 million
mainly due to an increase in the amount of intangible assets recognized
following the purchase of an additional 20% investment in Wolfpac. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision for inventory obsolescence decreased by Php120
million, or 37%, to Php202 million primarily due to a lower level of obsolete inventory
in 2006.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Other
operating expenses decreased by Php393 million, or 40%, to Php578 million
primarily due to various lower business and operational-related expenses such
as bank charges, representation expenses and a loss on share swap in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:0in' style="margin-top:0;margin-bottom:0"><b><i>Operating Income</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Operating income from our wireless business amounted to Php38,134
million in 2006, an increase of Php664 million, or 2%, from Php37,470 million
in 2005, which was primarily due to increased revenues, mainly from our
cellular services, partially offset  by higher operating expenses.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Financing Costs</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Financing gain amounted to Php1,359 million in 2006,
an increase of Php552 million, or 68%, from Php807 million in 2005 due to the
combined results of lower interest expense owing to lower debt balances and
accretion on financial liabilities as well as higher capitalized interest.  The
breakdown of our financing costs for our wireless business for the years ended
December 31, 2006 and 2005 is as follows:</p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:445.9pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest on loans and related items</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php716</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,037</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php321)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(31)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accretion on financial liabilities &#150; net</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">129</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">248</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(119)</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(48)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Financing charges</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(29)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Capitalized interest </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(248)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(85)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(163)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Foreign exchange gains &#150; net</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,993)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,059)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">66</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php1,359)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php807)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php552)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">68</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0"><b><i>Interest Income</i></b></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Interest income generated by our wireless business
amounted to Php965 million in 2006, a decrease of Php92 million, or 9%,
compared to Php1,057 million in 2005 mainly attributable to Smart&#146;s lower
average cash balances.</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></h6>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Loss (Gain) on Derivative Transactions</i></h6>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Gain on derivative transactions increased by Php157
million, or 133%, to Php39 million in 2006 as compared to a loss on derivative
transactions of Php118 million in 2005 primarily due to mark-to-market gain from
Smart&#146;s forward foreign exchange contracts as a result of the peso appreciation.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Other Income &#150; Net </i></h6>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our wireless business segment generated other income -
net of Php2,285 million in 2006, an increase of Php993 million, or 77%, from
Php1,292 million in 2005.  The increase
was primarily due to the recognition of a gain of Php1,698 million on early
settlement by Piltel of its restructured debt and a reversal of prior years&#146;
provision for NTC fees to align with the assessments received in 2005.  </p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>Income Before Income
Tax, Cumulative Effect of Change in Accounting Policy and Minority Interest in
Net Income (Loss) of Consolidated Subsidiaries</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Income
before income tax, cumulative effect of change in accounting policy and
minority interest in net income (loss) of consolidated subsidiaries increased
by Php2,274 million, or 6%, to Php42,782 million in 2006 compared to Php40,508
million in 2005, mainly due to a 5% increase in wireless operating revenues,
principally from our cellular business resulting from the continued cellular
subscriber growth in 2006, and an increase in other income.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Provision for Income Tax</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Provision for income tax increased by Php4,444
million, or 104%, to Php8,729 million in 2006 from Php4,285 million in 2005,
primarily due to higher non-tax deductible charges and the net movement in
deferred tax assets.  For 2006, the net movement in deferred tax assets
primarily pertains to deferred tax assets recognized in relation to the benefit
to be derived from the disposal of certain of Piltel&#146;s assets with the lifting
of certain mortgage trust indenture restrictions resulting from the full
prepayment of Piltel&#146;s restructured debt on December 4, 2006.  We currently
expect that our effective corporate tax rate will be higher going forward than
in previous years due to the expiration of Smart&#146;s income tax holiday.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Net Income</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
wireless business segment recorded a net income of Php32,918 million in 2006, a
decrease of Php2,912 million, or 8%, over Php35,830 million registered in 2005 as
the increase in our cellular revenues and our other income was more than offset
by an increase in operating expenses and higher provision for income tax.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
text-indent:.3in;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Fixed Line</h6>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Operating Revenues </i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Our fixed line business provides local
exchange service, international and national long distance services, data and
other network services, and miscellaneous services.  Total fixed line revenues
generated from our fixed line business in 2006 totaled Php49,282 million, a decrease
of Php190 million from Php49,472 million in 2005.  As a percentage of our total
operating revenues, fixed line revenues decreased to 36% in 2006 from 38% in
2005, principally due to the continued growth of our wireless business.  </p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table summarizes total operating
revenues from our fixed line business for the years ended December 31, 2006 and
2005, respectively, by service segment:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:95.2%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=9 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fixed line services:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Service Revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Local exchange</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php16,993</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">35</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php20,229</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php3,236)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(16)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">International long distance</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,933</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,245</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">25</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,312)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">National long distance</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,920</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,254</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,666</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Data and other network</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,725</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,394</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,331</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Miscellaneous</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,632</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,309</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">323</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">25</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,203</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,431</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(228)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Non-Service Revenues</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Sale of cellular
 handsets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">79</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Total
 Fixed Line Operating Revenues </p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#D9D9D9;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 2.25pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php49,282</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php49,472</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php190)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Service Revenues</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Local Exchange Service</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our local exchange service revenues consist of: </p>

<p style='line-height:8.0pt;page-break-after:avoid;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
flat monthly fees for our postpaid
service; </p>

<p style='line-height:8.0pt;page-break-after:avoid;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
installation charges and other
one-time fees associated with the establishment of customer service;</p>

<p style='line-height:8.0pt;page-break-after:avoid;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
fixed charges paid by other
telephone companies, charges retained by PLDT for calls terminating to cellular
subscribers within the local area, and local access charges paid by cellular
operators for calls by cellular subscribers that terminate to our local
exchange network;</p>

<p style='line-height:8.0pt;page-break-after:avoid;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues from usage of prepaid
cards for calls within the local area and any unused peso value of expired
prepaid cards; and</p>

<p style='line-height:8.0pt;page-break-after:avoid;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
charges for special features,
including bundled value-added services such as call waiting, call forwarding,
multi-party conference calling, speed calling and caller ID. </p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table summarizes key measures of our
local exchange service business segment as at and for the years ended December
31, 2006 and 2005, respectively:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:91.34%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December
 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Consolidated local exchange service revenues (in
 millions)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php16,993</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php20,229</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php3,236)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(16)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Number
 of fixed line subscribers(1)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,776,647</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,842,507</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(65,860)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Number
 of fixed line employees</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">8,711</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">9,197</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(486)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Number
 of fixed line subscribers per employee</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">204</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">200</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">_____________</p>

<p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>(1) Previously set forth as number of fixed lines in
service.  2006 was restated to reflect the effect of the change in parameters
used to align with the PLDT Group&#146;s policy on subscriber count with the planned
use of an integrated billing system for our subscribers.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Revenues from our local exchange service decreased by
Php3,236 million, or 16%, to Php16,993 million in 2006 from Php20,229 million
in 2005.  The decrease was primarily due to a 4% decline in the number of fixed
line subscribers and the appreciation of the peso which required us to make
downward adjustments in our monthly local service rates.  The percentage
contribution of local exchange revenues to our total fixed line service revenues
decreased to 35% in 2006 as compared to 41% in 2005.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, postpaid and prepaid fixed line subscribers totaled 1,450,331
and 326,316, respectively, which accounted for approximately 82 % and 18 %,
respectively, of our total fixed line subscribers.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Pursuant to a currency exchange rate adjustment
mechanism authorized by the Philippine National Telecommunications Commission,
or the NTC, we adjust our postpaid monthly local service rates upward or
downward by 1% for every Php0.10 change in the peso-to-dollar exchange rate
relative to a base rate of Php11.00 to US$1.00.  In 2006, we implemented eight
downward adjustments and three upward adjustments in our monthly local service
rates, while there were six downward adjustments and three upward adjustments
in 2005.  The average Philippine peso to U.S. dollar rate factored in our
monthly local service rates in 2006 was Php51.53 to US$1.00, compared to an
average of Php55.21 to US$1.00 in 2005.  This change in the average
peso-to-dollar rate translated to a peso appreciation of 7%, which resulted in
a net decrease of approximately 6% in our average monthly local service rates
in 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:22.5pt' style="margin-top:0;margin-bottom:0"><i>International
Long Distance Service</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our international long distance service revenues,
which we generate through our international gateway facilities, consist of:</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
inbound call revenues representing
settlements from foreign telecommunications carriers for inbound international
calls, virtual transit and hubbing service and reverse charged calls such as
received collect and home country direct service;</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
access charges paid to us by other
Philippine telecommunications carriers for terminating inbound international
calls to our local exchange network; and</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
outbound call revenues representing amounts billed to our customers (other than our
cellular customers) for outbound international calls, net of amounts payable to
foreign telecommunications carriers for terminating calls in their territories.</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows information about our
international fixed line long distance business for the years ended December
31, 2006 and 2005, respectively:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:94.24%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total international
 long distance service revenues (in millions)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,933</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php12,245</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php2,312)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:13.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inbound</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8,378</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:.1in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,203</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(1,825)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(18)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:13.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Outbound</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,555</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,042</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(487)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(24)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">International call volumes (in million
 minutes, except call ratio)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,177</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,266</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(89)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:27.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Inbound</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,984</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,117</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(133)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:27.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Outbound</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">193</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">149</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.7pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:27.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Inbound-outbound
 call ratio</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">10.3:1</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">14.2:1</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:.05in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.7pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our total international long distance service revenues
decreased by Php2,312 million, or 19%, to Php9,933 million in 2006 from
Php12,245 million in 2005, primarily due to the peso appreciation, a decrease
in average termination rates for inbound calls and a decline in inbound call
volumes largely as a result of alternative means of communications such as
e-mailing, texting and Internet telephony.  The percentage contribution of
international long distance service revenues to our total fixed line service
revenues decreased to 20% in 2006 from 25% in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
revenues from inbound international long distance service decreased by Php1,825
million, or 18%, to Php8,378 million due to a decrease in inbound traffic
volume by 133 million minutes to 1,984 million minutes in 2006 coupled with a
decrease in average termination rates.  In addition, the appreciation of the
Philippine peso to the U.S. dollar with average rates of Php51.165 in 2006 and
Php55.006 in 2005 contributed to the decrease in our inbound international long
distance revenues in peso terms, since settlement charges for inbound calls are
billed in U.S. dollars or in special drawing rights, an established method of
settlement among international telecommunications carriers using values based
on a basket of foreign currencies that are translated into pesos at the time of
billing.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
revenues from outbound international long distance service decreased by Php487
million, or 24%, to Php1,555 million in 2006 primarily due to a decline in
average revenue per minute as a result of a lower average collection rate with
the introduction of low-rate services such as <i>PLDT ID-DSL</i> and <i>Budget
Card</i>, and the peso appreciation in 2006, which more than offset the significant
increase in outbound international call volumes in 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>National
Long Distance Service</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
national long distance service revenues consist of:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
per minute charges for calls made
by our fixed line customers outside of the local service areas but within the
Philippines, net of interconnection charges payable for calls carried through
the backbone network of, and/or terminating to the customer of, another
telecommunications carrier; </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
access charges received from other
telecommunications carriers for calls carried through our backbone network
and/or terminating to our customers; and</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
fixed charges paid by other
telephone companies, charges retained by PLDT for calls terminating to cellular
subscribers within the local area, and local access charges paid by cellular
operators for calls by cellular subscribers that terminate to our local
exchange network.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows our national
long distance service revenues and call volumes for the years ended December
31, 2006 and 2005, respectively:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:98.08%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='height:9.6pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.6pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total national long distance service
 revenues (in millions)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">Php6,920</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">Php5,254</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1,666</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">National long distance call volumes (in million
 minutes)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">2,251</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">2,348</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">(97)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our national long distance service revenues increased
by Php1,666 million, or 32%, to Php6,920 million in 2006 from Php5,254 million
in 2005, primarily due to higher average revenue per minute in 2006 due to the
change in mechanics in our Php10 per call promotion which more than offset the
decrease in call volumes.  In 2005, the Php10 per call promotion was open to
all PLDT Group fixed line subscribers nationwide while in 2006, the Php10 per
call service was made available only to registered PLDT subscribers for a
monthly service fee.  Accordingly, the percentage contribution of national long
distance revenues to our fixed line service revenues accounted for 14% and 11%
in 2006 and 2005, respectively.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Data
and Other Network Services</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
data and other network service revenues include charges for leased lines,
IP-based, packet-based and switched-based services.  These services are used
for domestic and international communications such as private networking,
broadband and narrowband Internet-based data communications, and packet-based
communication.  </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following table shows information about our data and other network service
revenues for the years ended December 31, 2006 and 2005:</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:9.9pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase </b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=7 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Data and other network
 service revenues (in millions)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php13,725</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php10,394</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">Php3,331</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Number of DSL broadband
 subscribers</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">133,159</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">88,811</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">44,348</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">50</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Number of PLDT Vibe
 narrowband subscribers</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">297,250</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">266,703</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">30,547</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2006, our data and other network services posted revenues of Php13,725 million,
an increase of Php3,331 million, or 32%, from Php10,394 million in 2005,
primarily due to increases in leased lines, IP-based and switched-based data
services, particularly Diginet and DFON rental, <i>PLDT DSL</i> and <i>PLDT
Vibe</i> services.  The revenue contribution of this service segment to our
fixed line service revenues increased to 28% in 2006 from 21% in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>PLDT
DSL</i> contributed revenues of Php3,132
million in 2006, an increase of Php754 million, or 32%, from Php2,378 million
in 2005, primarily due to an increase in the number of subscribers.  <i>PLDT</i>
<i>DSL</i> reached 133,159 subscribers as at December 31, 2006 compared with
88,811 subscribers in the same period in 2005.  <i>PLDT</i> <i>DSL </i>offers a
number of packages with maximum speeds ranging from 88 kbps to 5 Mbps depending
on the plan. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>PLDT Vibe</i>
revenues increased by Php106 million, or 38%, to Php387 million in 2006 from
Php281 million in 2005, primarily due to an increase in subscribers.  As at December 31, 2006, <i>PLDT Vibe </i>registered
users totaled 297,250, of which 100,362 were exclusive postpaid users, 182,968
were exclusive prepaid users, and 13,920 were both postpaid and prepaid users.
As at December 31, 2005, <i>PLDT Vibe</i> registered users totaled 266,703, of
which 97,016 were exclusive postpaid users, 149,973 were exclusive prepaid
users, and 19,714 were both postpaid and prepaid users.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">In support of the growing data requirements of the
small and medium enterprise market, the network footprints of BRAINS, IP-VPN
and <i>Shops.work,</i> PLDT&#146;s private local networking services, have been
expanded with the roll-out of NGN facilities in key business areas across the
country.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
continued growth in data services revenues can be attributed to several product
offerings.  The steady demand for dedicated connectivity or private networking
from the corporate market using PLDT&#146;s traditional international and domestic
data offerings &#150; Fibernet, Arcstar, Acacia, I-Gate, Diginet, BRAINS, IP-VPN and
<i>Shops.work</i>, among others &#150; continues to provide us with a stable revenue
source.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
93%' style="margin-top:0;margin-bottom:0">Diginet, our domestic
private leased line service, has been providing Smart&#146;s increasing fiber optic
and leased line data requirements.  Diginet revenues increased by Php2,335
million, or 53%, to Php6,771 million in 2006 as compared to Php4,436 in 2005
mainly due to Smart&#146;s DFON rental of Php4,940 million and Php3,062 million in
2006 and 2005, respectively.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Miscellaneous</i></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Miscellaneous service revenues are derived mostly from
directory advertising and facilities rental.  In 2006, these revenues increased
by Php323 million, or 25%, to Php1,632 million from Php1,309 million in 2005.
The improvement was mainly due to an increase in rental income, primarily from
co-location charges on account of an increase in the number of co-location
sites, coupled with an increase in facility management fees.  The percentage
contribution of miscellaneous service revenues to our total fixed line service
revenues was 3% and 2% in 2006 and 2005, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Operating Expenses</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Expenses
related to our fixed line business totaled Php39,086 million in 2006, an increase
of Php97 million as compared to Php38,989 million in 2005.  The increase was
primarily due to an increase in compensation and benefits, repairs and maintenance,
selling and promotions and asset impairment expenses, partially offset by lower
provision for doubtful accounts, depreciation and amortization and taxes and
licenses.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table sets forth the breakdown of our
total fixed line-related expenses for the years ended December 31, 2006 and 2005,
respectively, and the percentage of each expense item to the total:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:93.26%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=12 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=10 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fixed line services:</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php17,676</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">Php18,240</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">47</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(Php564)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits(1)</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,207</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">8,261</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1,946</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Repairs and maintenance</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,232</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">3,297</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">935</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,736</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,535</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">201</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,579</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,727</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(148)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(9)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,128</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,039</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">89</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">730</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">942</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(212)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(23)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication, training and travel</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">506</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">447</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">59</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Insurance and security services</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">499</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">628</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(129)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(21)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost of computers </p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">159</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">106</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">200</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,944</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(1,899)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(98)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for inventory obsolescence</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">157</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(148)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(94)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other operating expenses</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">580</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">719</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(139)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total </p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php39,086</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">Php38,989</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php97</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='line-height:150%;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other;border:none' style="margin-top:0;margin-bottom:0">____________</p>

<p style="margin-top:0;margin-bottom:0"><i>(1)  Includes salaries and
benefits, incentive plan, pension and MRP costs.</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Depreciation
and amortization charges decreased by Php564 million, or 3%, to Php17,676
million due to the lower depreciation of our regular asset base.  </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Compensation and benefits expenses increased by Php1,946
million, or 24%, to Php10,207 million, primarily due to the effect of
collective bargaining agreement-related increases in salaries and benefits, and
an increase in incentive plan-related accruals, partially offset by a reduction
in the number of fixed line employees due to PLDT&#146;s manpower rightsizing
program.  For further discussion on our long-term incentive plan, please see Item
6. &#147;Directors, Senior Management and Employees &#150;&#150; Long-Term Incentive Plan&#148; and
<i>Note 17 &#150; Employee Benefits</i> to the accompanying consolidated financial
statements in Item 18.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
94%' style="margin-top:0;margin-bottom:0">Repairs and maintenance
expenses increased by Php935 million, or 28%, to Php4,232 million, primarily
due to higher maintenance costs for foreign cable and wire facilities as more
operating and maintenance-related restorations were incurred in 2006 as
compared to 2005.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Selling and promotions expenses increased by Php201
million, or 13%, to Php1,736 million, primarily as a result of an increase in
PLDT&#146;s promotional activities in relation to various products and services,
coupled with higher public relations expense in 2006.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Rent
expenses decreased by Php148 million, or 9%, to Php1,579 million due to lower
office and building rentals, and a decrease in transponder lease charges,
partially offset by an increase in international and domestic leased circuits
charges.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Professional and other contracted services increased
by Php89 million, or 9%, to Php1,128 million primarily due to higher contracted
services and bill printing fees in 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Taxes
and licenses decreased by Php212 million, or 23%, to Php730 million, mainly on
account of lower business-related taxes incurred in 2006 as compared to 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Communication,
training and travel expenses increased by Php59 million, or 13%, to Php506
million due to an increase in local and foreign travel and training in 2006 as
compared to 2005.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Insurance
and security services decreased by Php129 million, or 21%, to Php499 million,
primarily due to lower premiums on property all-risk, industrial all-risk and
industrial fire insurance as well as lower security services due to a decrease
in number of contracted security guards.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cost
of computers increased by Php106 million, or 200%, to Php159 million in 2006
due to the computer-bundled sales in relation to our DSL promotion and <i>WeRoam</i>
subscriptions.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision
for doubtful accounts decreased by Php1,899 million, or 98%, to Php45 million
primarily on account of improvement in collection rates in 2006 as compared to
2005. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for inventory obsolescence decreased by Php148
million, or 94%, to Php9 million primarily due to the consequent reversal of
provisions with the change in realizability of certain receivable accounts
specifically identified and previously provided for.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Other
operating expenses decreased by Php139 million, or 19%, to Php580 million due
to lower office supplies consumption and printing costs.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Operating Income</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Operating income from our fixed
line service amounted to Php10,196 million in 2006, a decrease of Php287
million, or 3%, from Php10,483 million in 2005, which was primarily due to an
increase in fixed line-related expenses particularly increased compensation and
benefits, coupled with the decrease in fixed line-related revenues.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Financing Costs</i></b></p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Financing costs decreased by
Php491 million, or 12%, to Php3,685 million in 2006 largely due to lower
interest on loans and related items owing to lower debt balances in 2006 as
compared to 2005 partially offset by lower foreign exchange gains recorded in
2006 as a result of lower foreign currency debt levels and higher hedge costs.
The breakdown of financing costs for our fixed line business for the years
ended December 31, 2006 and 2005 is as follows: </p>

<p style='line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.25in;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.7pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.7pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 padding:0in 5.4pt 0in 5.4pt;height:6.7pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest on loans and related items</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php6,254</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,058</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php2,804)</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(31)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Financing charges</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,460</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,384</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">76</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accretion on financial liabilities &#150; net</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">206</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">320</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(114)</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(36)</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Capitalized interest</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(301)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(419)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">118</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(28)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Foreign exchange gains &#150; net</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,934)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,167)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,233</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(36)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php3,685</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,176</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php491)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(12)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Interest Income</i></b></p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Interest
income generated by our fixed line business amounted to Php441 million in 2006,
an increase of Php56 million, or 15%, compared to Php385 million in 2005 mainly
attributable to PLDT&#146;s higher average cash balances in 2005.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>Loss (Gain) on
Derivative Transaction</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Loss
on derivative transactions amounted to Php6,900 million in 2006, an increase of
Php5,217 million, or 310%, from Php1,683 million in 2005 primarily due to PLDT&#146;s mark-to-market loss from principal only swaps as
a result of the peso appreciation in 2006 and lower interest differential
between peso and U.S. dollar interest rates.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>Other Income - Net</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">All other income/gains such as
rental income, gain on disposal of property, which do not fall under service
revenues are included under this classification.  In 2006, our fixed line
business segment registered an increase in other income of Php1,118 million to
Php1,314 million from Php196 million in 2005 mainly due to a gain on sale of
fixed assets, other property and materials in the aggregate amount of Php658
million and a gain relating to a refund from Manila Electric Company, or
Meralco, of Php194 million recorded at fair value in 2006 (payable by Meralco
over four years.)</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Income Before Income
Tax, Cumulative Effect of Change in Accounting Policy and Minority Interest in
Net Income of Consolidated Subsidiaries</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
fixed line business segment registered an income before income tax, cumulative
effect of change in accounting policy and minority interest in net income of
consolidated subsidiaries of Php1,366 million in 2006, a decrease of Php3,839
million, or 74%, compared to Php5,205 million in 2005 mainly due to higher loss
on derivative transactions partially offset by higher other income. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Provision for Income
Tax</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Provision
for income tax amounted to Php351 million in 2006, a decrease of Php193
million, or 35%, as compared to Php544 million in 2005 primarily due to net
movement in deferred tax assets owing to higher foreign exchange differentials
realized in 2005.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Net Income </i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">In 2006, our fixed line business
segment contributed a net income of Php923 million, a decrease of Php3,737
million, or 80%, as compared to Php4,660 million in 2005 mainly due to higher
loss on derivative transactions. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b>Information and
Communications Technology</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><b><i>Operating
Revenues </i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our information and communications technology business
is conducted by ePLDT, a wholly-owned subsidiary of PLDT.  </p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
July 11, 2006, ePLDT acquired a 100%
equity interest in SPi and its direct and indirect Philippine and offshore
subsidiaries for a cash consideration of US$135 million.  SPi is the second
largest pure-play BPO service provider and the ninth largest independent BPO
service provider worldwide.  It has operations in 19 locations in North
America, Europe and Asia.  On August 11, 2006, SPi acquired 100% of CyMed, Inc.,
a leading medical transcription company based in Richmond, Virginia.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
February 16, 2006, ePLDT acquired a 60% equity interest in Level Up!, a leading
publisher of online games in the Philippines.  The acquisition of Level Up!,
together with netGames, ePLDT&#146;s online gaming subsidiary, is expected to strengthen
ePLDT&#146;s online gaming business in the Philippines.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">For
further discussion, see Item 4. &#147;Information on the Company &#150;&#150; Organization&#148;,
Item 4. &#147;Information on the Company &#150;&#150; Business &#150;&#150; Information and
Communications Technology&#148; and <i>Note 9 &#150; Goodwill and Other Intangible Assets
</i>to the accompanying consolidated financial statements in Item 18.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2006, our information and communications technology business generated revenues
of Php6,890 million, an increase of Php3,585 million, or 108%, from Php3,305
million in 2005.  This increase was largely due to the consolidation of SPi,
CyMed and Level Up! since July 11, 2006, August 11, 2006 and February 16, 2006,
respectively, and the continued increase of our call center revenues.  Going
forward, we expect revenues from our call center and BPO businesses to continue
to contribute significantly to our information and communications technology
revenues in light of the growing demand for our call center and BPO services
and as a result of the full-year consolidation of SPi, CyMed and Level Up!.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table summarizes our total operating
revenues from our information and communications technology business for the
years ended December 31, 2006 and 2005 by service segment:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.5in;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=11 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase </b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=11 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td  colspan=11 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service Revenues</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:10.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Call center</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,624</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,944</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">59</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php680</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">35</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">BPO</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,374</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">34</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,374</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Internet and online gaming </p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">796</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">556</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">240</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">43</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Vitro</i>TM data center</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">428</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">376</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">115</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">77</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,337</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">92</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,953</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">89</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,384</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">115</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Non-service Revenues</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Point-Product Sales</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">553</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">352</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">201</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.3in;text-indent:-.3in' style="margin-top:0;margin-bottom:0">Total Operating ICT Revenues </p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php6,890</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,305</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,585</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">108</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Service Revenues</i></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Service
revenues generated by our information and communications technology segment
amounted to Php6,337 million in 2006, an increase of Php3,384 million, or 115%,
as compared to Php2,953 million in 2005 primarily as a result of the
consolidation of SPi and Level Up! and the continued growth of our call center
business.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Call</i><i> Center</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Call center revenues consist of:</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
inbound calls for customer care,
product inquiries, sales and technical support based on active minutes;</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
outbound calls for sales and
collections based on active minutes; and </p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
service income for e-mail
handling, web chat, web co-browsing, data entry and BPO based on transaction
volume.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Revenues related to our call center business increased
by Php680 million, or 35%, to Php2,624 million in 2006 from Php1,944 million in
2005, primarily due to the combined effects of the following:</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
an increase in programs being
handled by Vocativ from 2005 brought about by the acquisition of additional
clients in 2006, as Ventus entered into an alliance with one of India&#146;s leading
BPO companies to serve their voice requirements; </p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
an increase in the number of
registered minutes for Parlance&#146;s inbound projects and hours for outbound
projects; </p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
an increased call volume handled
by Ventus due to the expansion of our domestic call center group, which
currently serves internal (Smart) and external (credit card companies) clients;</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the expansion of Vocativ&#146;s
existing Taguig facility by 530 seats from approximately 1,190 seats in 2005 to
approximately 1,720 seats in 2006;</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the expansion of Ventus&#146; existing Iloilo facility by 130 seats from approximately 370 seats in 2005 to approximately 500
seats in 2006; </p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the expansion of Ventus&#146;
back-up/overflow Makati facility by 220 seats from approximately 80 seats in
2005 to approximately 300 seats in 2006, which provided capacity for seasonal
requirements of Iloilo-based programs;</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the commencement of operations at
the 820-seat Ventus Pasig call center in August 2006; and</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
the commencement of operations at
the 780-seat Parlance Libertad call center in September 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Call
center revenues accounted for 41% and 66% of total information and
communications technology service revenues in 2006 and 2005, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Business
process outsourcing</i></p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">BPO
revenues consist of:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
editorial and content production
services to the scholarly scientific, technical and medical (SSTM) journal
publishing industry;</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
digital content conversion
services to information incentive organizations such as online and traditional
publishers, libraries, educational institutions, Global 1,000 corporations and
government agencies worldwide;</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
pre-press project management
services to book publishers;</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
litigation support services which involve conventional coding
and electronic discovery support services for international law firms,
corporate counsels and government agencies; and</p>

<p style='margin-left:.75in;page-break-after:avoid;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
conversion services of medical record/data from handwritten or
speech format to electronic format. </p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
provide our BPO services primarily through SPi and its subsidiaries, which we
acquired on July 11, 2006.  In 2006, BPO contributed revenues of Php2,374
million, primarily from services of SPi and its subsidiaries, and accounted for
37% of total service revenues of our information and communications technology
business in 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Internet and online gaming</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Internet and online gaming service
revenues consist of: </p>

<p style='margin-left:.5in;line-height:7.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues derived from actual usage
of Internet access network by prepaid subscribers and any unused peso value of
expired prepaid cards or electronic Internet time loads, net of discounts given
to dealers; </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
monthly service fees from postpaid
corporate and consumer subscribers, including (1) charges for internet usage in
excess of allocated free plan Internet hours; (2) one-time installation and
activation fees; and (3) fees for value added services including e-mail and web
hosting services;</p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
one-time fees generated from
reselling Internet-related solutions such as security solutions and domain
registration; </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
franchise and royalty fees for <i>Netopia</i>
Internet caf&#233;s, including a one-time subscription fee and monthly recurring
franchise fees based on certain conditions in the franchise agreement; </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues from community access of
computers and desktop publishing based on actual usage, net of discounts given
to users; and </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
online gaming revenues from unique
subscribers, including one-time sale of gaming cards and electronic pins, and
top-up fees upon actual consumption of gaming credits or after expiration of
any unused peso value thereof.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Revenues from our Internet and online gaming businesses
increased by Php240 million, or 43%, to Php796 million in 2006 from Php556
million in 2005 primarily due to the full year consolidation of Airborne Access
and the consolidation of Level Up! in May 2006, which resulted in additional
revenues of Php11 million and Php138 million, respectively.  Our Internet and online
gaming business revenues accounted for 13% and 19% of service revenues of our
information and communications technology business in 2006 and 2005,
respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Vitro&#153; </i>data
center</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">ePLDT operates an Internet data center under the brand
name <i>Vitro</i>&#228; which provides co-location services, server hosting,
hardware and software maintenance services, website development and maintenance
services, webcasting and webhosting, shared applications, data disaster
recovery and business continuity services, intrusion detection, and security
services such as firewalls and managed firewalls.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Vitro&#153;</i>
revenues consist of:</p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
monthly service fees derived from
co-location services, server hosting, hardware and software maintenance
services, website development and maintenance services, web hosting, data
recovery security services and other value added services; and</p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
installation charges and other
one-time fees associated with the set-up and professional services of Vitro&#146;s
certified professionals.</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2006, <i>Vitro</i><i>&#153;</i> contributed revenues of Php428 million, an increase
of Php52 million, or 14%, from Php376 million in 2005, primarily due to an
increase in co-location revenues and server hosting.  <i>Vitro</i>&#228; revenues accounted for 7% and 13% of service revenues of our information
and communications technology business in 2006 and 2005, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Others</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other revenues consist of:</p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
fees generated for issuance of
digital certificates and licenses; and </p>

<p style='margin-left:.5in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
revenues derived from IT
helpdesk/contact center solutions and terminals for credit, debit and credit
card transactions.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Revenues
from other businesses related to our information and communications technology
segment increased by Php38 million, or 49%, to Php115 million in 2006 from
Php77 million in 2005, largely due to IT helpdesk/contact center services
rendered coupled with an increase in the number of digital certificates sold.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Please
refer to <i>Note 8 &#150; Investments</i> to the accompanying consolidated financial
statements in Item 18 for further discussion on ePLDT&#146;s other information and
communications technology services.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Non-service Revenues</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Non-service
revenues consist of sales generated from reselling certain software licenses,
server solutions, networking products, storage products and data security
products.  In 2006, non-service revenues generated by our information and
communications technology business increased by Php201 million, or 57%, to
Php553 million as compared to Php352 million in 2005, primarily due to higher
revenues from sales of networking equipment and software licenses.</p>

<p style='text-indent:31.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Operating Expenses</i></b></p>

<p style='text-indent:31.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Expenses associated with our information and
communications technology business totaled Php7,142 million in 2006, an
increase of Php3,889 million, or 120%, from Php3,253 million in 2005 primarily
due to the consolidation of SPi, CyMed and Level Up! resulting primarily in an
increase in compensation and benefits, and professional and other contracted
services.  We currently expect these expenses to be significantly higher going
forward as a result of the full year consolidation of SPi, CyMed and Level
Up!.  As a percentage of our information and communications technology
revenues, expenses related to our information and communications technology
business were 104% and 98% for 2006 and 2005, respectively.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows the breakdown of our total
information and communications technology-related expenses for the years ended
December 31, 2006 and 2005, respectively, and the percentage of each expense
item to the total:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=13 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase </b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Information and communications technology services:</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits(1)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,021</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1,352</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1,669</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">123</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">739</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">82</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">657</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">801</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">711</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">415</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">296</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">71</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost of sales &#150; point-product</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">476</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">300</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">176</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">59</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">444</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">362</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">82</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">23</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Asset impairment </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">408</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">397</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3609</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Repairs and maintenance</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">368</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">283</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">85</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">294</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">121</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">173</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">143</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication, training and travel</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">276</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">98</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">178</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">182</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Amortization of intangible assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">130</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">115</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">767</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">67</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">31</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">86</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">64</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Insurance and security services</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">33</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">136</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other operating expenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">111</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">110</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt' style='page-break-inside:
 avoid !msorm;height:3.5pt !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:3.5pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total </p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php7,142</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:3.5pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,253</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,889</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">120</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">____________</p>

<p style='text-indent:.5in;line-height:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>(1)   Includes salaries and
benefits, incentive plan, pension and MRP costs.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Compensation
and benefits increased by Php1,669 million, or 123%, to Php3,021 million
largely due to the increased number of employees and corresponding salaries and
employee benefits resulting from the expansion of our call center businesses
and the consolidation of SPi and Level Up! in 2006.  ePLDT&#146;s employee headcount
increased by 9,558, or 208%, to 14,150 in 2006 from 4,592 in 2005.  The
increase in the number of employees as at December 31, 2006 was primarily due
to ePLDT&#146;s acquisition of SPi, CyMed and Level Up!.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Professional
and other contracted services increased by Php657 million, or 801%, to Php739
million primarily due to services sub-contracted by SPi from third parties
related to its BPO services.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Depreciation and amortization charges increased by Php296
million, or 71%, to Php711 million primarily due to an increase in the
depreciable asset base in relation to the expansion of our call center
businesses and the consolidation of SPi in July 2006.  </p>

<p style='text-indent:.5in;line-height:11.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;line-height:11.0pt' style="margin-top:0;margin-bottom:0">Cost of sales increased by Php176 million, or 59%, to
Php476 million primarily due to an increase in the cost of point products sold
in 2006.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Rent
expenses increased by Php82 million, or 23%, to Php444 million primarily due to
the opening of two additional call center sites in 2006 which led to increased
rental of leased circuits.</p>

<p style='text-indent:.5in;line-height:11.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Asset
impairment increased by Php397 million to Php408 million primarily due to the
impairment of ePLDT&#146;s notes receivable from Technology Support Services, Inc.
Please see <i>Note 8 &#150; Investments &#150; Investment of ePLDT in Debt Securities of
Technology Support Services, Inc., or TSSI (formerly First Advance Multi-Media
Entertainment Corp., or FAME) </i>to the accompanying consolidated financial
statements in Item 18 for further discussion.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Repairs and maintenance expenses increased by Php85
million, or 30%, to Php368 million primarily due to higher hosting-related
costs incurred in 2006 as compared to 2005 partially offset by Vitro&#146;s lower
hardware and server maintenance costs.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
94%;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling
and promotions expenses increased by Php173 million, or 143%, to Php294 million
mainly due to higher advertising and marketing spending of netGames and Level
Up!.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Communication,
training and travel expenses increased by Php178 million, or 182%, to Php276
million, primarily due to the increased cost of phone lines, bandwidth and
information system charges, coupled with the increase in foreign and local
travel costs incurred by our call center and BPO businesses. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">An
amortization of intangible assets amounting to Php130 million and Php15 million
were recognized in 2006 and 2005, respectively.  Amortization of intangibles in
2006 resulted primarily from the acquisition of SPi and Level Up!, while
amortization of intangibles in 2005 resulted from the impairment of goodwill of
ePLDT&#146;s investment in Netopia.  See <i>Note 9 &#150; Goodwill and Other Intangible
Assets</i> to the accompanying consolidated financial statements in Item 18 for
further discussion.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Taxes
and licenses increased by Php31 million, or 86%, to Php67 million due to higher
business-related taxes accrued and paid in 2006 as compared to 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision
for doubtful accounts increased by Php10 million, or 19%, to Php64 million
mainly due to anticipated uncollectible accounts specifically identified in
2006.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Insurance and security services increased by Php19
million, or 136%, to Php33 million primarily due to higher premium costs and an
increase in the value of assets insured in 2006 as compared to 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Other operating expenses increased by Php1 million, or
1%, to Php111 million mainly due to higher business-related costs.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:13.5pt' style="margin-top:0;margin-bottom:0"><b><i>Financing Costs</i></b></p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Financing costs increased by Php79 million, or 146%,
to Php133 million, primarily due to the consolidation of SPi in July 2006.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
text-indent:13.5pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Provision for Income Tax </i></h6>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">Benefit from income tax amounted to Php34 million in
2006 primarily due to the recognition of deferred tax assets pertaining to
accrued pension cost, net operating loss carry-over and allowance for doubtful
accounts, as compared to a provision for income tax of Php20 million in 2005.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:13.5pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Net Income (Loss</i><i>)</i></h6>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2006, our information and communications technology business segment registered
a net loss of Php243 million as against a net income of Php113 million in 2005
mainly as a result of a 120% increase in ICT-related expenses and the recent
opening of two call centers, partly offset by the increase in ICT revenues
mainly from our call center business and the consolidation of SPi.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005 Compared to 2004</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>On a Consolidated Basis</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Consolidated Operating Revenues</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Largely
driven by the growth of our wireless business, our consolidated operating
revenues for 2005 increased by Php2,162 million, or 2%, to Php123,335 million
in 2005 from Php121,173 million in 2004.  This
increase was lower than the increase in our consolidated operating revenues in
2004, primarily due to the reduced growth of our cellular subscriber base in
2005 compared to 2004.  The revenue
contribution of our wireless business accounted for 62% of our consolidated
operating revenues for 2005 and 2004.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows the breakdown of our
consolidated operating revenues for the years ended December 31, 2005 and 2004 by business segment:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=12 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:1.55pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December
 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=12 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Wireless </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php76,906</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">62</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php74,764</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">62</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,142</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Fixed line</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,472</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">48,546</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">926</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Information and communications
 technology </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,305</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,401</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">904</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inter-segment revenues</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:3.25pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,348)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='text-align:right;text-indent:9.35pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4,538)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='text-align:right;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,810)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php123,335</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php121,173</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,162</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Consolidated Operating Expenses</i></b></p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our consolidated operating expenses in 2005 increased
by Php2,187 million, or 3%, to Php74,821 million from Php72,634 million in 2004.
The increase was primarly due to higher operating expenses associated with our
fixed line business and our information and communications technology business,
partially offset by a decrease in operating expenses associated with our
wireless business.  As a percentage of our consolidated operating revenues,
consolidated operating expenses increased to 61% from 60% in 2004.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows the breakdown of our
consolidated operating expenses for the years ended December 31, 2005 and 2004 by business segment:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=12 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:1.55pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December
 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=12 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Wireless </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php39,436</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php41,598</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php2,162)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Fixed line</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">38,989</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">32,027</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,962</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Information and communications
 technology </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,253</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,035</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">218</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inter-segment revenues</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,857)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9)</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='text-align:right;text-indent:9.35pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4,026)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,831)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">70</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php74,821</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php72,634</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,187</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Consolidated Operating Income</i></b></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our consolidated operating income in 2005 was Php48,514
million, a decrease of Php25 million compared to Php48,539 million in 2004 as a
result of a 3% increase in our consolidated operating expenses which more than
offset the 2% increase in our consolidated operating revenues.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Consolidated Financing Costs</i></b></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Financing
costs on a consolidated basis decreased by Php12,810 million, or 79%, to Php3,423
million primarily due to foreign exchange gains pertaining to the foreign
exchange revaluation of the carrying values of financial liabilities as against
a losss on foreign exchange revaluation in 2004 owing to the peso appreciation in
2005. This decrease was complemented by lower interest expense and related
items owing to lower debt balances in 2005 compared with 2004.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Consolidated Interest
Income</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Interest
income on a consolidated basis increased by Php515 million, or 55%, to Php1,457
million in 2005 from Php942 million in 2004 mainly attributable to higher
average cash balances.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Consolidated Loss (Gain)
on Derivative Transactions</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Loss
on derivative transactions on a consolidated basis amounted to Php1,801 million
in 2005, an increase of Php937 million, or 108%, compared to Php864 million in
2004 primarily due to mark-to-market loss from interest rate swap and
bifurcated equity call options partially offset by gains from long-term
currency swaps and long-term foreign currency options. </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Consolidated Other Income
- - Net</i></b></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Other
income on a consolidated basis totaled Php1,016 million in 2005, a decrease of
Php1,514 million, or 60%, compared to Php2,530 million in 2004.  The decrease
was mainly due to the recognition of a gain on debt restructuring transaction
conducted by Smart in 2004 pertaining to a wireless business with no similar
gain in 2005.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Consolidated I</i></b><b><i>ncome Before Income Tax, Cumulative Effect of Change
in Accounting Policy and Minority Interest in Net Loss (Income) of Consolidated
Subsidiaries </i></b></p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our income before income tax, cumulative
effect of change in accounting policy and minority interest in net loss
(income) of consolidated subsidiaries in 2005 was Php45,770 million, an
increase of Php10,930 million, or 31%, from Php34,840 million in 2004,
primarily due to the significant decline in our financing costs owing to
substantial foreign exchange gains recognized in 2005.</p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Provision for Income Tax</i></b></p>

<p style='line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision
for income tax decreased by Php1,977 million, or 29%, to Php4,849 million in
2005 compared to Php6,826 million in 2004 <a name="OLE_LINK11"></a><a
name="OLE_LINK10">mainly due to lower non-tax deductible charges </a>and the net movement in deferred tax assets as previously unrecognized deferred tax assets were
taken-up in 2005 with the increased likelihood that Smart and Piltel would be
able to realize the future tax benefits on these assets.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Consolidated Net Income</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As a result, our consolidated net income in 2005 was
Php40,603 million, an increase of Php12,502 million, or 44%, compared to Php28,101
million in 2004.  The following table shows the breakdown of our consolidated
net income (loss) for the years ended December 31, 2005 and 2004 by business segment:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:1.55pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December
 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;text-indent:9.0pt;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Wireless </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.55pt;text-align:right;
 text-indent:2.65pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php35,830</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">88</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.2pt;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php27,559</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">98</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:8.0pt;text-align:right;
 text-indent:1.1pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php8,271</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Fixed line</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.55pt;text-align:right;
 text-indent:2.65pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,660</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.2pt;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,241</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:8.0pt;text-align:right;
 text-indent:1.1pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,419</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">276</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Information and communications technology
 </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.55pt;text-align:right;
 text-indent:2.65pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">113</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:.1in;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(699)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style=';text-align:center;
 text-indent:9.35pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:8.0pt;text-align:right;
 text-indent:1.1pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">812</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">116</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='text-indent:9.0pt;line-height:8.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.55pt;text-align:right;
 text-indent:2.65pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php40,603</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:10.2pt;text-align:right;
 line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php28,101</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:8.0pt;text-align:right;
 text-indent:1.1pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php12,502</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 text-indent:9.0pt;line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>On Business Segment Basis</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b>Wireless</b></p>

<p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><b><i>Operating
Revenues </i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our wireless business segment offers cellular services
as well as wireless broadband, satellite, VSAT and other services.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following table summarizes our total operating service and non-service revenues
from our wireless business for the years ended December 31, 2005 and 2004 by service segment:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:98.98%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=11 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Wireless services:</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:13.2pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service Revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Cellular </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php71,518</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php66,421</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">89</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php5,097</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Wireless broadband, satellite, VSAT and
 others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,677</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,232</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">445</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #D9D9D9;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">74,195</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">96</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #D9D9D9;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">68,653</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">92</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,542</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;text-indent:9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Non-service Revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;text-indent:.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Sale
 of cellular handsets and SIM-packs</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,711</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,111</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,400)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(56)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Total
 Wireless Operating Revenues </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php76,906</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php74,764</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">Php2,142</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:auto' style="margin-top:0;margin-bottom:0">Service Revenues</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our wireless service revenues increased by Php5,542
million, or 8%, to Php74,195 million in 2005 compared to Php68,653 million in
2004 mainly as a result of the continued growth of Smart&#146;s and Piltel&#146;s
subscriber base.  However, the growth in Smart&#146;s and Piltel&#146;s subscriber
base in 2005 was lower than the increases
in Smart&#146;s and Piltel&#146;s subscriber base of 48% and 51% in 2004 and 2003,
respectively.  As a percentage of our total wireless operating revenues,
wireless service revenues increased to 96% in 2005 from 92% in 2004. </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Cellular
Service</i></p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Unless otherwise indicated, the financial data and
operating metrics cited in the cellular service section reflect the
consolidated results of our cellular subsidiary, Smart and its subsidiary,
Piltel.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
cellular service revenues in 2005 amounted to Php71,518 million, an increase of
Php5,097 million, or 8%, from Php66,421 million in 2004.  Cellular service
revenues accounted for 93% and 89% of our total wireless operating revenues in
2005 and 2004, respectively.  The increase in cellular service revenues was
primarily due to the continued growth of Smart&#146;s and Piltel&#146;s subscriber base.
As at December 31, 2005, the combined cellular subscribers of Smart and Piltel
reached 20,408,621, an increase of 1,200,389, or 6%, over their combined
cellular subscriber base of 19,208,232 as at December 31, 2004.  Prepaid and postpaid net subscriber activations totaled 1,194,805 and 5,584, respectively,
in 2005.  However, the growth in Smart&#146;s
and Piltel&#146;s subscriber base in 2005 was
lower than the increases in Smart&#146;s and Piltel&#146;s subscriber base of 48% and 51%
in 2004 and 2003, respectively.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The table below shows our cellular subscribers base as
at December 31, 2005 and 2004:</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:97.12%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:4.5pt;margin-bottom:.0001pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>As at December 31,</b></p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style=';text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Cellular subscriber base </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,408,621</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,208,232</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,200,389</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify' style="margin-top:0;margin-bottom:0">Prepaid </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">20,128,543</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,933,738</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,194,805</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt' style="margin-top:0;margin-bottom:0">Smart </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,144,118</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">14,321,288</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">822,830</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify;text-indent:
 9.0pt' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,984,425</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,612,450</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">371,975</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;text-align:justify' style="margin-top:0;margin-bottom:0">Postpaid</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">280,078</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">274,494</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,584</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Of our 20,408,621 subscribers as at December 31, 2005, prepaid subscribers accounted for approximately 99% while postpaid
subscribers accounted for the remaining 1%.  Our cellular prepaid subscriber
base grew by 6% to 20,128,543 as at December 31, 2005 from 18,933,738 as at
December 31, 2004, whereas our postpaid subscriber base increased by 2% to
280,078 as at December 31, 2005 from 274,494 as at December 31, 2004.  Smart&#146;s
prepaid and postpaid net subscriber activations totaled 822,830 and 5,584,
respectively, in 2005, or a quarterly average addition of 205,707 prepaid and
1,396 postpaid subscribers.  On the other hand, Piltel&#146;s prepaid subscribers
increased by 8% to 4,984,425 as at December 31, 2005 from 4,612,450 as at
December 31, 2004, or a quarterly average addition of 92,994 subscribers.
Postpaid subscribers as at December 31, 2005 were higher than as at December 31, 2004 primarily due to increased net activations in the last two quarters of
2005.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our quarterly net subscriber activations (reductions)
over the eight quarters in 2005 and 2004 are as follows:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:418.5pt;margin-left:24.85pt;border-collapse:collapse'>
 <tr style='height:9.35pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Prepaid</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Postpaid</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Smart</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Piltel</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Smart</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">First Quarter</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">920,885</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">129,753</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:11.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,357)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,044,281</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Second Quarter</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">314,607</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">222,233</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">116</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">536,956</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Third Quarter</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:11.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(53,953)</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">42,723</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,506</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:11.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(724)</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fourth Quarter</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:11.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(358,709)</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:11.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(22,734)</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,319</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:12.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:11.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(380,124)</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">First Quarter</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,162,301</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">218,038</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,866</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,397,205</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Second Quarter</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,207,542</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">468,772</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,691</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,684,005</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Third Quarter</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">797,686</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">635,978</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,445</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,444,109</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fourth Quarter</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,322,624</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">422,577</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:11.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9,485)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:.2in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,735,716</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
text-indent:.25in;page-break-after:auto' style="margin-top:0;margin-bottom:0">Wireless Broadband, Satellite, VSAT
and Other Services</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our revenues from wireless broadband, satellite, VSAT
and other services consist mainly of rentals received for the lease of Mabuhay
Satellite&#146;s transponders and Telesat&#146;s VSAT facilities to other companies and
wireless broadband service revenues from Smart Broadband, charges for ACeS
Philippines&#146; satellite phone service and service revenues from PLDT Global
subsidiary&#146;s mobile virtual network operations.  Smart Broadband offers a
number of wireless broadband services with 25,428 subscribers as of December 31, 2005, including 21,759 <i>Smart WiFi</i> subscribers.  </p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Gross service revenues from these services for 2005
amounted to Php2,677 million, an increase of Php445 million, or 20%, from Php2,232
million in 2004.  This increase was primarily due to the growth in our wireless
broadband business.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>Non-service Revenues</i></p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our wireless non-service revenues decreased by Php3,400
million, or 56%, to Php2,711 million in 2005 as compared to Php6,111 million
in 2004 mainly attributable to lower handset sales due to the fact that
activations in 2005 were primarily driven by more SIM-pack sales and SIM-swap
activities up to May 2005.  </p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
text-indent:.3in;page-break-after:auto;punctuation-wrap:hanging;text-autospace:
ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Operating
Expenses</i></h6>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Operating expenses associated with our wireless
business in 2005 amounted to Php39,436 million, a decrease of Php2,162 million,
or 5%, from Php41,598 million in 2004.  A significant portion of this decrease
was mainly attributable to decreases in costs of cellular handsets and
SIM-packs sold and selling and promotion, partially offset by higher rent, and professional
and other contracted sevices.  As a percentage of our total wireless operating
revenues, operating expenses associated with our wireless business decreased to
51% in 2005 from 56% in 2004.   </p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Cellular business expenses accounted for 94% while wireless
broadband, satellite, VSAT and other business expenses accounted for 6% of our
wireless business expenses in 2005, compared to 93% and 7%, respectively, in
2004.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table summarizes our wireless-related
expenses for the years ended December 31, 2005 and 2004 and the percentage of
each expense item to the total:</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:95.2%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=11 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Wireless services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,200</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php10,082</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php882)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Costs of cellular handsets and SIM-packs sold</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,827</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,599</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">25</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4,772)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(45)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,577</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,156</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,421</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">34</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits(1)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,245</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,195</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,050</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">33</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.65pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Repairs and maintenance</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,667</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,597</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:7.65pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,070</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.65pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,124</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,261</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,137)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(27)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,608</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">472</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,136</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">241</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,538</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,214</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">324</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">27</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost of satellite air time</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,008</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,299</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(291)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(22)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication, training and travel</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">960</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">791</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">169</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Insurance and security services</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">947</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">937</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision
 for inventory obsolescence</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">322</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">213</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision
 for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">253</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">204</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Amortization
 of intangible assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">189</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">96</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">103</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Asset
 impairment </p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">430</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">(430)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(100)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Other
 operating expenses</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">971</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,055</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">(84)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(8)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Total
 </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php39,436</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php41,598</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">(Php2,162)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">__________</p>

<p style='margin-left:.25in;text-indent:-.25in;line-height:
3.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>(1)  Includes salaries and
benefits, incentive plan, pension and manpower rightsizing program, or MRP,
costs.</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization charges decreased by Php882 million,
or 9%, to Php9,200 million substantially due to a decrease in the
depreciable asset base as certain of our wireless assets were fully depreciated
by the end of 2005.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Costs
of cellular handsets and SIM-packs sold decreased by Php4,772 million, or 45%,
to Php5,827 million as activations in 2005 were primarily driven by more
SIM-pack sales and SIM-swap activities compared to handset sales in 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Rent
expenses increased by Php1,421 million, or 34%, to Php5,577 million on account
of an increase in the number of DFON facilities leased by Smart from PLDT and
site rental expense.  As at December 31, 2005, we had 4,305 cell sites and
5,982 base stations, compared with 3,951 cell sites and 5,303 base stations as
at December 31, 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Compensation
and benefits increased by Php1,050 million, or 33%, to Php4,245 million
primarily due to salary increases and higher long-term incentive costs of Smart.  On
the other hand, Smart's employee headcount decreased by 3% to 5,087 as at
December 31, 2005 from 5,239 as at December 31, 2004.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Repairs
and maintenance expenses increased by Php1,070 million, or 41%, to Php3,667 million
mainly on account of higher repairs and maintenance costs, and higher site electricity
and power generation expenses due to, and in line with, the continued growth in
the number of cell sites and other network facilities.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Selling
and promotions expenses decreased by Php1,137 million, or 27%, to Php3,124
million due to efficient media spending and termination of certain media
contracts in 2005.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Professional
and other contracted services increased by Php1,136 million, or 241%, to
Php1,608 million mainly as a result of increased legal, technical service, and call
center and payment facilities fees.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Taxes
and licenses increased by Php324 million, or 27%, to Php1,538 million mainly
due to an increase in Smart&#146;s business-related taxes.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cost
of satellite air time decreased by Php291 million, or 22%, to Php1,008 million
due to a change in the basis of recognizing air time cost.  In 2004, satellite
air time cost was accrued at a fixed amount per month based on the payment
schedule in a standstill agreement in consideration for unlimited air time
access.  In 2005, upon the termination of the standstill agreement, air time
cost was reverted to the original charging rate on a per minute basis.  This
was agreed to be the basis of air time cost until a new agreement is
finalized.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Communication,
training and travel increased by Php169 million, or 21%, to Php960 million due
to higher local travel and training costs, as well as an increase in delivery,
freight and hauling expenses incurred in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Insurance
and security services increased by Php10 million, or 1%, to Php947 million mainly due to the increase in our number of cell sites
and in the amount of network equipment insured as a result of, and in line
with, the continued growth and expansion of our network.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision for inventory obsolescence increased by
Php109 million, or 51%, to Php322 million, primarily due to slow sales of handsets
relating to ACeS Philippines in 2005.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts increased by Php49
million, or 24%, to Php253 million in 2005 mainly due to a net reversal of
provisions for carrier accounts in 2004 following subsequent collections from
such carrier accounts.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Amortization of intangible assets increased by Php96 million, or 103%,
to Php189 million in 2005, primarily due to the full year effect of the amortization
of intangibles incurred in acquiring equity interests in Smart Broadband and
Wolfpac by Smart in 2004. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">No
impairment charges were recognized in 2005.  Asset impairment charges amounted
to Php430 million in 2004 due to impairment losses recognized in respect of
Mabuhay Satellite&#146;s investment in an investee company. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Other
operating expenses decreased by Php84 million, or 8%, to Php971 million due to a decrease
in various business and operational-related expenses such as office supplies
expense.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:0in' style="margin-top:0;margin-bottom:0"><b><i>Operating Income</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Operating income from our wireless business amounted to Php37,470
million in 2005, an increase of Php4,304 million, or 13%, from Php33,166
million in 2004, which was primarily due to increased revenues, mainly from our
cellular services, complemented by lower operating expenses.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Financing Costs</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Financing
gains associated with our wireless business amounted to Php807 million in 2005
compared to financing costs of Php2,292 million in 2004 primarily due to
foreign exchange gains as a result of the 6% and 18% level of appreciation of
the Philippine peso to the U.S. dollar and Japanese yen, respectively, from
December 31, 2004 to December 31, 2005 compared to foreign exchange losses in
2004.  Foreign exchange losses recorded in 2004 with the peso depreciation of
1% against the U.S. dollar, aggravated by the peso depreciation with
approximately 6% against the Japanese yen from December 31, 2004, amounted to
Php423 million.  In addition, lower debt balances in 2005 also contributed to
decreased interest expense on loans.  The breakdown of our financing costs for
our wireless business for the years ended December 31, 2005 and 2004 is as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.25in;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Change</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest on loans and related items</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,037</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,082</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php45)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accretion on financial liabilities</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">248</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">884</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(636)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(72)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Financing charges</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,100</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Capitalized interest</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(85)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(98)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Foreign exchange (gains) losses &#150; net</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,059)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">423</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,482)</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(587)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php807)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,292</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php3,099)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(135)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:0in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><i>Interest Income</i></b></p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Interest income generated by our wireless business
amounted to Php1,057 million in 2005, an increase of Php333 million, or 46%,
compared to Php724 million in 2004 mainly attributable to Smart&#146;s higher
average cash balances.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Loss (Gain) on Derivative Transactions</i></h6>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Loss on derivative transactions amounted to Php118
million in 2005, an increase of Php125 million, from a gain on derivative
transactions of Php7 million in 2004 primarily due to mark-to-market loss from Smart&#146;s
forward foreign exchange contracts as a result of the peso appreciation.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Other Income - Net</i></h6>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our wireless business segment generated other income -
net of Php1,292 million in 2005, a decrease of Php638 million, or 33%, from Php1,930
million in 2004.  This decrease was primarily a result of a Php2,820 million
gain on a debt restructuring transaction conducted by Smart in 2004 pertaining
to our wireless business.  See <i>Note 12 &#150; Interest-bearing Financial
Liabilities &#150; Term Loans &#150; US$283 Million Term Loan Facility, or Debt Exchange
Facility </i>to the accompanying consolidated financial statement in Item 18.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>Income Before Income
Tax, Cumulative Effect of Change in Accounting Policy and Minority Interest in
Net Income (Loss) of Consolidated Subsidiaries</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Income
before income tax, cumulative effect of change in accounting policy and
minority interest in net income (loss) of consolidated subsidiaries increased
by Php7,045 million, or 21%, to Php40,508 million in 2005 compared to Php33,463
million in 2004, mainly due to a 3% increase in wireless operating revenues,
principally from our cellular business, resulting from the continued cellular
subscriber growth, as well as a decrease in our wireless business expenses of 5%
in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Provision for Income
Tax</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision for income tax decreased by Php1,682
million, or 28%, to Php4,285 million in 2005 from Php5,967 million in 2004 mainly
due to lower non-tax deductible charges and
the net movement in deferred tax assets as previously unrecognized deferred tax
assets were taken-up in 2005 with the increased likelihood that Smart and
Piltel would be able to realize the future tax benefits on these assets.  We
currently expect that our effective corporate tax rate will be higher going
forward than in previous years due to the expiration of Smart&#146;s income tax
holiday. </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Net Income</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
wireless business segment recorded a net income of Php35,830 million in 2005,
an increase of Php8,271 million, or 30%, over Php27,559 million registered in
2004 primarily due to the 6% growth in our cellular subscriber base,
complemented by a 5% decrease in wireless expenses.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
text-indent:.3in;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">Fixed Line</h6>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Operating Revenues </i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Operating revenues generated from our fixed line
business for 2005 totaled Php49,472 million, an increase of Php926 million, or 2%,
from Php48,546 million in 2004.  This
increase was primarily due to higher revenues generated from data and other
network services, and miscellaneous revenues, which was partially offset by
decreased revenues from national long distance services, international long
distance services and local exchange service.  As a percentage of our total
operating revenues, fixed line revenues decreased to 38% in 2005 from 39% in 2004,
principally due to the continued growth of our wireless business.  </p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table summarizes total operating
revenues from our fixed line business for the years ended December 31, 2005 and
2004, respectively, by service segment:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:95.2%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=9 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fixed line services:</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Service Revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Local exchange</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php20,229</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php20,606</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php377)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">International long distance</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,245</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">25</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,804</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(559)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">National long distance</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,254</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,736</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,482)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(22)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Data and other network</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,394</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,114</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,280</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">46</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Miscellaneous</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,309</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,286</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,431</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48,546</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">885</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Non-Service Revenues</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Sale of cellular handsets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:5.75pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Total
 Fixed Line Operating Revenues </p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#D9D9D9;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 2.25pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php49,472</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php48,546</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php926</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Service Revenues</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Local
Exchange Service</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following table summarizes key measures of our local exchange service business
segment as at and for the years ended December 31, 2005 and 2004, respectively:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:91.34%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:9.0pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Consolidated
 local exchange service revenues (in millions)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">Php20,229</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">Php20,606</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.0pt'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(Php377)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Number
 of fixed line subscribers</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,842,507</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,834,306</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8,201</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Number
 of fixed line employees</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">9,197</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">9,692</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(495)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0">Number
 of fixed line subscribers per employee</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">200</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">189</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Revenues from our local exchange service in 2005
decreased by Php377 million, or 2%, to Php20,229 million from Php20,606 million
in 2004.  The decrease was primarily due to a decline in the number of fixed
line subscribers and the appreciation of the peso against U.S. dollars which
required us to make downward adjustments in our monthly local service rates, which
was partially offset by adjustments in our monthly local service rates.  The
percentage contribution of local exchange revenues to our total fixed line
service revenues decreased to 41% in 2005 from 42% in 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">As at December 31,
2005, postpaid and prepaid fixed line subscribers totaled 1,453,297 and 389,210,
respectively, which accounted for approximately 79% and 21%, respectively, of our
total fixed line subscribers.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Pursuant to a currency exchange rate adjustment
mechanism authorized by the NTC, we adjust our monthly local service rates
upward or downward by 1% for every Php0.10 change in the peso-to-U.S. dollar
exchange rate relative to a base rate of Php11.00 to US$1.00.  During 2005, we
implemented six downward and three upward adjustments in our monthly local
service rates compared to six upward and one downward adjustments in 2004.  The
average peso-to-U.S. dollar rate factored in our monthly local service rates in
2005 was Php55.21 to US$1.00, compared to the average of Php55.89 to US$1.00 in
2004.  This change in the average peso-to-U.S. dollar rate translated to a peso
appreciation of 2%, which resulted in an average net decrease of 1% in our
monthly local service rates in 2005. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>International Long Distance Service</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows information about our
international fixed line long distance business for the years ended December
31, 2005 and 2004, respectively:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:94.24%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Decrease</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total international
 long distance service revenues (in millions)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php12,245</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php12,804</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php559)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:13.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inbound</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,203</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:.1in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,686</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(483)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=right style='margin-right:.05in;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:13.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Outbound</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,042</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,118</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(76)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style=';text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">International call volumes (in million
 minutes, except call ratio)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,266</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,373</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(107)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:27.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Inbound</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,117</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,216</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(99)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:27.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Outbound</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">149</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">157</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(8)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:27.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Inbound-outbound
 call ratio</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">14.2:1</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">14.1:1</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:.05in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:
 right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our total international long distance service revenues
decreased by Php559 million, or 4%, to Php12,245 million in 2005 from Php12,804
million in 2004 primarily due to the peso appreciation coupled with the
decrease in call volumes largely as a result of alternative means of
communications such as e-mailing, texting and Internet telephony.  The
percentage contribution of international long distance service revenues to our
fixed line service revenues decreased to 25% in 2005 from 26% in 2004.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
revenues from inbound international long distance service decreased by Php483
million due to a decrease in inbound traffic volume by 99 million minutes to 2,117
million minutes in 2005.  In addition, the 2% appreciation in the average value
of peso to U.S. dollar to Php55.006 during 2005 from Php56.149 during 2004
contributed to the decrease in our inbound international long distance revenues
in peso terms since settlement charges for inbound calls are billed in U.S.
dollars or in special drawing rights, an established method of settlement among
international telecommunications carriers using values based on a basket of
foreign currencies that are translated into pesos at the time of billing.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
revenues from outbound international long distance calls in 2005 decreased by
Php76 million, or 4%, to Php2,042 million from Php2,118 million in 2004.  The decrease
resulted from lower conversion rates used as average billing rates were Php55.30
and Php55.98 in 2005 and 2004, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
outbound international long distance call volumes declined by 5% to 149 million
minutes in 2005 from 157 million minutes in 2004, primarily due to cellular
substitution (subscribers opting to use cellular for international outbound
calls) and the popularity of alternative means of communications such as
e-mailing, international text messaging and Internet telephony.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>National
Long Distance Service</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows our national
long distance service revenues and call volumes for the years ended December
31, 2005 and 2004, respectively:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:98.08%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='height:9.6pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.6pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.6pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
 margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Total national long distance service
 revenues (in millions)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">Php5,254</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">Php6,736</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(Php1,482)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right' style="margin-top:0;margin-bottom:0">(22)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">National long distance call volumes (in million
 minutes)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">2,348</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">1,930</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">418</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our national long distance service revenues decreased
by Php1,482 million, or 22%, to Php5,254 million in 2005 from Php6,736 million
in 2004 as a result of: (1) a decrease in average revenue per minute due to our
fixed rate per call promotion starting February 14, 2005; and (2) the
integration of local exchanges into a single calling area, which resulted in
calls between two exchanges located within the same province no longer being
considered as national long distance calls, but rather as local calls.
Accordingly, the percentage contribution of national long distance revenues to
our fixed line service revenues decreased to 11% in 2005 compared to 14% in
2004.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
national long distance call volumes increased by approximately 22% to 2,348
million minutes in 2005 from 1,930 million minutes in 2004.  This was mainly
due to the Php10 per call promotion offered to PLDT fixed line subscribers
nationwide.  </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
integration of some of our local exchanges into a single local calling area, as
approved by the NTC, also negatively affected our national long distance call
volumes, and consequently, our revenues.  Because of this integration, calls
between two exchanges located within the same province are no longer considered
national long distance calls but are treated as local calls.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Data
and Other Network Services</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
data and other network services in 2005 generated revenues of Php10,394
million, an increase of Php3,280 million, or 46%, from Php7,114 million in
2004, which was primarily due to increases in revenues generated in leased
lines and IP-based data services, particularly Diginet and DSL.  The revenue
contribution of this service segment to our fixed line service revenues
increased to 21% in 2005 from 15% in 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Data and other network services we currently provide
include leased lines, IP-based, packet-based and switch-based services.  These
services are used for domestic and international communications such as private
networking, broadband and narrowband Internet-based data communications, and
packet-based communication.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Of
our total revenues generated in data and other network services in 2005, leased
lines accounted for 55%, IP-based services accounted for 29%, packet-based
services accounted for 11% and switched-based services accounted for the
remaining 5%, compared to 56%, 25%, 13% and 6%, respectively, in 2004.  These
percentage increases indicate a continuing demand for broadband services,
particularly the high bandwidth clear data requirements of BPOs and call
centers.  We expect this trend to continue due to growth in the areas of
e-commerce, online services and BPOs particularly among call centers, medical
transcription, animation and shared services.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
93%' style="margin-top:0;margin-bottom:0">The continued growth in
data services revenues can be attributed to several product offerings.  The
steady demand for dedicated connectivity or private networking from the
corporate market using PLDT&#146;s traditional bandwidth offerings &#150; Fibernet, Arcstar,
Acacia, I-Gate, Diginet, BRAINS, among others &#150; continues to provide us with a
stable revenue source.  In addition, we provide Smart&#146;s increasing fiber optic
and leased line data requirements, which are included under our national data
services.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Miscellaneous</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Miscellaneous service revenues are derived mostly from
directory advertising and facilities rental.  In 2005, these revenues increased
by Php23 million, or 2%, to Php1,309 million from Php1,286 million in 2004.
The improvement was mainly due to an increase in co-location charges from more
co-location sites coupled with an increase in rent income on duct utilization
and cable restoration.  The percentage contribution of miscellaneous service
revenues to our fixed line service revenues decreased to 2% in 2005 from 3% in 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Operating Expenses</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Operating
expenses related to our fixed line business in 2005 totaled Php38,989 million,
an increase of Php6,962 million, or 22%, compared to Php32,027 million in
2004.  The increase was primarily due to higher depreciation and amortization
and higher selling and promotions expenses which were partially offset by lower
provision for doubtful accounts expense.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table sets forth the breakdown of our
total fixed line-related expenses for the years ended December 31, 2005 and 2004, respectively, and the percentage of each expense item to the total:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:93.26%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=9 valign=bottom style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fixed line services:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php18,240</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">47</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">Php9,677</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php8,563</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">88</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits(1)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8,261</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">7,921</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">25</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">340</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Repairs and maintenance</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,297</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">3,211</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">86</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,944</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">3,751</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(1,807)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(48)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,727</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,746</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,535</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,159</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">376</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,039</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,060</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(21)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">942</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">820</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">122</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Insurance and security services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">628</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">700</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(72)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(10)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication, training and travel</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">447</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">449</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for inventory obsolescence</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">157</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">361</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(204)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(57)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost of computers sold</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Asset impairment </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">365</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(365)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(100)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other operating expenses</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">719</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">807</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(88)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 0in 0in 0in;height:
 9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(11)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php38,989</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">Php32,027</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php6,962</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:9.35pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:150%;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other;border:none' style="margin-top:0;margin-bottom:0">____________</p>

<p style="margin-top:0;margin-bottom:0"><i>(1)  Includes salaries and
benefits, incentive plan, pension and MRP costs.</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Depreciation
and amortization charges increased by Php8,563 million, or 88%, to Php18,240
million mainly due to the effect of our change in estimated useful lives of
certain property, plant and equipment in line with our continuous network
upgrade and expansion, which resulted in increased depreciation charges for
2005, and higher depreciation of our regular asset base primarily resulting
from additional completed projects.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Compensation and benefits expenses increased by Php340
million, or 4%, to Php8,261 million primarily due to the effect of the
collective bargaining agreement-related increases in salaries and benefits and
an increase in incentive plan-related accruals, partially offset by a reduction
in headcount due to PLDT&#146;s manpower rightsizing program.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
94%;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Repairs
and maintenance expenses increased by Php86 million, or 3%, to Php3,297 million
primarily due to higher maintenance costs for foreign cable and wire facilities
as more operating and maintenance-related restorations were incurred in 2005 as
compared to 2004.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision
for doubtful accounts decreased by Php1,807 million, or 48%, to Php1,944
million, primarily on account of a lower provision by PLDT for anticipated
uncollectible accounts from various specifically identified domestic
telecommunications carriers which were provided for in 2004. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Rent expenses decreased by Php19 million, or 1%, to
Php1,727 million due to a decrease in international leased circuits and rental
charges occupied by various equipments, partially offset by higher rentals for
bundled sales/value added service units.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Selling and promotions expenses increased by Php376
million, or 32%, to Php1,535 million, primarily as a result of an increase in
PLDT&#146;s promotional activities in relation to various products and services,
partially offset by lower commissions paid in 2005.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Professional and other contracted services decreased
by Php21 million, or 2%, to Php1,039 million primarily due to lower advisory
and legal fees in 2005 for various services, partially offset by an increase in
facility management fees and collection agency fees. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Taxes
and licenses increased by Php122 million, or 15%, to Php942 million mainly on
account of higher NTC supervision and license fees, fringe benefit taxes in
respect of our stock option plan and other business-related taxes paid in 2005
as compared to 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Insurance
and security services decreased by Php72 million, or 10%, to Php628 million,
primarily due to lower premiums on property all-risk, industrial all-risk and
industrial fire insurance, partially offset by higher security services due to
a rate increase for contracted security guards.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Communication,
training and travel expenses decreased by Php2 million to Php447 million due to
a decrease in mailing, courier and delivery services, as well as a decrease in
local travel and training in 2005 as compared to 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision
for inventory obsolescence decreased by Php204 million, or 57%, to Php157
million primarily on account of lower inventory obsolescence owing to slow-moving
items determined in 2005 as compared to 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cost
of computers sold amounting to Php53 million were recognized in 2005 in
relation to our DSL promotion.  No similar charges were incurred in 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Asset
impairment amounted to Php365 million in 2004 owing to an impairment of a fixed
line subsidiary&#146;s facilities; no impairment charge was recognized in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Other
operating expenses decreased by Php88 million, or 11%, to Php719 million due to
lower office supplies consumption and printing costs resulting from PLDT&#146;s
continuing cost-containing activities.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Operating Income</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Operating income from our fixed
line service amounted to Php10,483 million in 2005, a decrease of Php6,036
million, or 37%, from Php16,519 million in 2004, which was primarily due to an increase
in fixed line-related expenses particularly increased depreciation, which more
than offset the 2% increase in fixed line-related revenues.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:0in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Financing Costs</i></b></p>

<p style='line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Financing
costs decreased by Php9,774 million, or 70%, to Php4,176 million due to the
strengthening of the peso relative to the U.S. dollar and Japanese yen
resulting in foreign exchange gains in 2005 as compared to foreign exchange
losses recorded during 2004, and lower interest payments on loans and related
items owing to lower debt balances in 2005 as compared to 2004.  </p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The breakdown of our financing costs for our fixed
line business for the years ended December 31, 2005 and 2004 is as follows:</p>

<p style='line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.25in;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.7pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:6.7pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=7 valign=top style=' border:none;
 padding:0in 5.4pt 0in 5.4pt;height:6.7pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest on loans and related items</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,058</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php10,634</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php1,576)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Financing charges</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,384</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,156</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">228</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accretion on financial liabilities &#150; net</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">320</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">301</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Capitalized interest</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(419)</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(497)</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">78</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(16)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Foreign exchange (gains) losses &#150;  net</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,167)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,356</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(8,523)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(362)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,176</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php13,950</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php9,774)</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(70)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Interest Income</i></b></p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Interest
income generated by our fixed line business amounted to Php385 million in 2005,
an increase of Php137 million, or 55%, compared to Php248 million in 2004
mainly attributable to PLDT&#146;s higher average cash balances in 2005.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Loss (Gain) on Derivative Transactions</i></h6>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Loss on derivative transactions amounted to Php1,683
million in 2005, an increase of Php812 million, or 93%, from Php871 million in
2004 primarily due to PLDT&#146;s mark-to-market
loss from interest rate swap and bifurcated equity call options partially
offset by gain from long-term currency swaps and long-term foreign currency
options.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Other Income - Net</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">All other income/gains such as
rental income, gain on disposal of property, which do not fall under service
revenues are included under this classification.  In 2005, our fixed line
business segment registered an increase in other income of Php122 million, or 165%,
to Php196 million from Php74 million in 2004.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Income Before Income Tax, Cumulative Effect of Change in Accounting
Policy and Minority Interest in Net Income of Consolidated Subsidiaries</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
fixed line business segment registered an income before income tax, cumulative
effect of change in accounting policy and minority interest in net income of
consolidated subsidiaries of Php5,205 million in 2005, an increase of Php3,185
million, or 158%, compared to Php2,020 million in 2004, primarily resulting
from lower fixed line business-related expenses, particularly financing costs
coupled with an increase in fixed line-related revenues, partially offset by
higher depreciation and amortization.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Provision for Income
Tax</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Provision
for income tax amounted to Php544 million in 2005 as compared to Php800 million
in 2004 due to taxable losses of PLDT owing to higher realized foreign exchange
gains in 2005 and the effect of tax rate adjustment.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Net Income </i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">In 2005, our fixed line business
segment registered a net income of Php4,660 million, an increase of Php3,419
million, or 276%, compared to Php1,241 million in 2004.  The increase was
primarily due to a slight increase in fixed line operating revenues and
significantly lower financing costs, partially offset by higher fixed line
operating expenses particularly increased depreciation and amortization.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b>Information and
Communications Technology</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Operating Revenues </i></b></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2005, our information and communications technology business generated operating
revenues of Php3,305 million, an increase of Php904 million, or 38%, from Php2,401
million in 2004, primarily due to the growth in our call center business.  The
revenues of our information and communications technology business accounted
for 3% and 2% of our total operating revenues in 2005 and 2004, respectively.
ePLDT&#146;s call center business contributed revenues of Php1,944 million, Internet
and online gaming contributed revenues of Php556 million and <i>Vitro&#153;</i>
contributed revenues of Php376 million, representing 66%, 19% and 13%,
respectively, of the total service revenues from our information and
communications technology business in 2005, compared to 62%, 27% and 8%, respectively,
in 2004.  Going forward, we expect revenues from our call center and Internet
and online gaming businesses to continue to contribute significantly to our
information and communications technology revenues with the growing demand for
call center services.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table summarizes our total operating
revenues from our information and communications technology business for the
years ended December 31, 2005 and 2004 by service segment:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:5.4pt;border-collapse:collapse'>
 <tr style='height:9.35pt'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=12 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=11 valign=top style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service Revenues</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Call center</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,944</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">59</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,283</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php661</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Internet and online gaming business</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">556</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">569</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(13)</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Vitro&#153;</i> data
 center</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">376</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">173</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">203</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">117</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p style='text-indent:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">77</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">55</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,953</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">89</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,080</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">87</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">873</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Non-service Revenues</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p style='text-indent:8.1pt' style="margin-top:0;margin-bottom:0">Point-of-product
 sales</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">352</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">321</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">31</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
 <tr style='height:9.35pt'>
 <td  colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p style="margin-top:0;margin-bottom:0">Total ICT Operating Revenues</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,305</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php2,401</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php904</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Service Revenues</i></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service revenues generated by our information and
communications technology business amounted to Php2,953 million in 2005, an
increase of Php873 million, or 42%, from Php2,080 million in 2004.  This was
primarily a result of the continued growth of our call center business.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Call</i><i> Center</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Revenues related to our call center business
in 2005 increased by Php661 million, or 52%, to <br>
Php1,944 million from Php1,283 million in 2004, primarily due to the combined
effects of the following: (1) Vocativ&#146;s upward price adjustment for voice and
VoIP, and an increase in programs being handled; (2) an upward price adjustment
by Parlance for its inbound and outbound projects, coupled with an increase in
the number of registered minutes for inbound projects and hours for outbound
projects; and (3) commencement of Ventus operations in Iloilo in March 2005.</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Call
center revenues accounted for 66% and 62% of our total information and
communications technology service revenues in 2005 and 2004, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Internet and online gaming</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Revenues from our Internet and online gaming business
in 2005 decreased by Php13 million, or 2%, to Php556 million from Php569
million in 2004, primarily due to a decrease in Infocom&#146;s revenues in 2005,
which was partially offset by the consolidation of Digital Paradise in June
2004.  Our Internet and online gaming business revenues accounted for 19% and
27% of service revenues from information and communications technology business
in 2005 and 2004, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Vitro&#153; </i>data
center</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">ePLDT
operates an Internet data center under the brand name <i>Vitro</i><i>&#153;</i>.  Granted
pioneer status as an Internet data center by the BOI, <i>Vitro</i><i>&#153;</i> provides
co-location services, server hosting, hardware and software maintenance
services, website development and maintenance services, webcasting and
webhosting, shared applications, data disaster recovery and business continuity
services, intrusion detection, and security services such as firewall and
managed firewall.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2005, <i>Vitro</i>&#228; contributed revenues of Php376 million, an increase
of Php203 million, or 117%, from Php173 million in 2004, primarily due to an
increase in co-location revenues, server hosting and other services.  <i>Vitro</i>&#228; revenues accounted for 13% and 8% of service revenues from our
information and communications technology business in 2005 and 2004,
respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Others</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Revenues
from other businesses related to our information and communications technology
segment in 2005 increased to Php77 million from Php55 million in 2004 largely
due to IT helpdesk/contact center services rendered coupled with an increase in
the number of digital certificates sold.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Please
refer to <i>Note 8 &#150; Investments</i> to the accompanying consolidated financial
statements in Item 18 for further discussion on ePLDT&#146;s other information and
communications technology services.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Non-service Revenues</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Non-service
revenues consist of sales generated from reselling certain Microsoft licenses,
server solutions, networking products, storage products and data security
products.  In 2005, non-service revenues generated by our information and
communications technology business increased by Php31 million, or 10%, to Php352
million compared to Php321 million in 2004, primarily due to higher revenues
from sales of networking equipment and Microsoft licenses.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Operating Expenses</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Expenses associated with our information
and communications technology business totaled Php3,253 million in 2005, an
increase of Php218 million, or 7%, from Php3,035 million in 2004, primarily due
to an increase in cash expenses, particularly compensation and benefits, and
depreciation and amortization, partly offset by an impairment provision
recognized in 2004.  As a percentage of our information and communications
technology revenues, expenses related to our information and communications
technology business were at 98% and 126% for 2005 and 2004, respectively.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows the breakdown of our total
information and communications technology-related expenses for the years ended December 31, 2005 and 2004, respectively, and the percentage of each expense item to the
total:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=13 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Years Ended December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Increase (Decrease)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>%</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.15in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=11 valign=bottom style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.15in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.6pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Information and communications technology services:</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:12.6pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:12.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:12.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and benefits(1)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1,352</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php900</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">Php452</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">50</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">415</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">339</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">76</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.95pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">362</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:4.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">366</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(4)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:4.95pt'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost of sales &#150; point products</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">300</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">230</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">70</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Repairs and maintenance</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">283</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">316</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(33)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(10)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">121</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">61</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">60</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">98</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication, training and travel</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">98</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">70</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">82</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">67</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">71</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Amortization of intangible assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Insurance and security services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Asset impairment </p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:5.75pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">617</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">20</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(606)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(98)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for inventory obslescence</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(3)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(100)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other operating expenses</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">110</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right' style="margin-top:0;margin-bottom:0">72</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">189</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.5pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total </p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,253</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:3.5pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php3,035</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php218</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in;
 height:3.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other;
border:none' style="margin-top:0;margin-bottom:0">____________</p>

<p style='text-indent:.5in;line-height:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>(1)   Includes salaries and
benefits, incentive plan, pension and MRP costs.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Compensation
and benefits increased by Php452 million, or 50%, to Php1,352 million, mainly
due to the expansion of our call center and Internet and online gaming
businesses, which resulted in an increase in headcount coupled with an increase
in salaries, bonuses and various incentives of employees.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Depreciation and amortization charges increased by
Php76 million, or 22%, to Php415 million, primarily due to an increase in the
depreciable asset base in relation to the expansion of our call center and
Internet and online gaming businesses.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Rent expenses decreased by Php4 million, or 1%, to
Php362 million primarily due to a decline in Vitro&#146;s lease of hosting equipment
for use in its Bureau of Internal Revenue project and the expansion of our call
center and Internet and online gaming businesses.   </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cost
of sales increased by Php70 million, or 30%, to Php300 million primarily due to
an increase in the cost of point products sold.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Repairs and maintenance expenses decreased by Php33
million, or 10%, to Php283 million, primarily due to Vitro&#146;s lower hardware
maintenance costs related to its IBM and CISCO equipments partially offset by
higher hosting-related costs incurred in 2005 as compared to 2004.</p>

<p align=right style='text-align:right;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Selling
and promotions expenses increased by Php60 million, or 98%, to Php121 million
mainly as a result of the commercial release of <i>Khan Online</i> in February
2005 following the commencement of netGames&#146; commercial operations.
Furthermore, Vitro&#146;s increase in sales of software products in 2005 as compared
to 2004 resulted in higher selling and marketing expenses.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Communication,
training and travel expenses increased by Php28 million, or 40%, to Php98
million due to the increased cost of bandwidth and information system charges,
coupled by the increase in telecommunications costs incurred by our call center
business for its outbound calls.  Furthermore, CSR trainings for our call
centers during 2005 contributed higher foreign travel and training costs
compared to 2004.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Professional
and other contracted services increased by Php15 million, or 22%, to Php82
million, primarily due to an increase in consultancy, legal and audit fees in
2005.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts amounted to Php54
million in 2005 primarily due to specifically identified doubtful accounts
pertaining to Infocom as of the end of 2005.  No provision was provided for in
2004.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Taxes
and licenses increased by Php15 million, or 71%, to Php36 million, mainly on
account of documentary stamp taxes paid by ePLDT and Ventus in their issuance
of additional capital stock in 2005 as compared to 2004.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Amortization of intangible assets amounted to Php15
million in 2005 due to impairment of goodwill of ePLDT&#146;s investment in <i>Netopia</i>.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Insurance and security services increased by Php7
million, or 100%, to Php14 million primarily due to higher premium costs and an
increase in the assets insured in 2005 as compared to 2004.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Asset impairment amounted to Php11 million in 2005, a
decrease of Php606 million, or 98%, primarily due to the recognition of an
impairment provision in relation to an investee company in 2004. </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision
for inventory obsolescence amounted to Php3 million in 2004 mainly pertaining
to maintenance-related inventory items of Infocom.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Other operating expenses increased by Php72 million,
or 189%, to Php110 million mainly due to recognition of royalty fees to <i>Khan
Online</i> in 2005 and an increase in other business-related costs.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0"><b><i>Financing Costs</i></b></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Financing costs increased by Php15 million, or 38%, to
Php54 million, primarily due to higher foreign exchange losses from
dollar-denominated receivables in 2005 as compared to 2004.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Provision for Income Tax </i></h6>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision for income tax amounted to Php20 million
in 2005, a decrease of Php39 million, or 66%, as compared to Php59 million in
2004, primarily due to lower reversal of Infocom&#146;s recorded deferred income tax
asset in 2005 as compared to 2004.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='margin-bottom:0in;margin-bottom:.0001pt;text-align:left' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><i>Net Income (Loss</i><i>)</i></h6>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2005, our information and communications technology business segment registered
a net income of Php113 million compared to a net loss of Php699 million posted
in 2004 mainly on account of the higher net income contribution of our call
center business and impairment provision recognized in 2004, partially offset
by Infocom&#146;s operating loss in 2005 and Digital Paradise&#146;s high operating costs
due to its ongoing expansion.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286161"></a><a name="_Toc75779217"></a><a
name="_Toc46082276"><b>Liquidity and Capital
Resources</b></a></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows our consolidated cash flows,
capitalization and other selected financial data as at and for the years ended
December 31, 2006, 2005 and 2004:</p>

<p style='text-indent:.5in;line-height:50%;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:92.46%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p style='border:none;padding:0in' style="margin-top:0;margin-bottom:0">Years Ended December 31,</p>
 </div>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </div>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash Flows</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' background:#E0E0E0;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net cash provided by
 operating activities</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php61,201</p>
 </td>
 <td   colspan=3 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php66,280</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php63,107</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net cash used in investing activities</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36,764</p>
 </td>
 <td   colspan=3 valign=top style=' background:#E0E0E0;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,080</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,764</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Capital expenditures</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,348</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,864</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,268</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net cash used in financing activities</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36,916</p>
 </td>
 <td   colspan=3 valign=top style=' background:#E0E0E0;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49,470</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30,325</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Effect of foreign exchange rate changes
 on cash and cash equivalents</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(710)</p>
 </td>
 <td   colspan=3 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(987)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(69)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net increase (decrease) in cash and cash
 equivalents</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(13,189)</p>
 </td>
 <td   colspan=3 valign=top style=' background:#E0E0E0;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,743</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,949</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p style='border:none;padding:0in' style="margin-top:0;margin-bottom:0">December 31,</p>
 </div>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </div>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=top style=' padding:0in 4.5pt 0in 4.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Capitalization</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.1in'>
 <td   style=' background:#D9D9D9;padding:0in 4.5pt 0in 4.5pt;
 height:.1in'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash and cash equivalents</p>
 </td>
 <td   colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 4.5pt 0in 4.5pt;height:.1in'>
 <div style='border:none;border-bottom:double windowtext 2.25pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:2.9pt'>
 <p align=right style='text-align:right;page-break-after:avoid;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0">Php16,870</p>
 </div>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 4.5pt 0in 4.5pt;
 height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 4.5pt 0in 4.5pt;height:.1in'>
 <div style='border:none;border-bottom:double windowtext 2.25pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:2.9pt'>
 <p align=right style='text-align:right;page-break-after:avoid;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0">Php30,059</p>
 </div>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Short-term debt</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:4.5pt' style="margin-top:0;margin-bottom:0">Notes payable</p>
 </td>
 <td   colspan=2 valign=top style=' background:#E0E0E0;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">201</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' background:#E0E0E0;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:4.5pt' style="margin-top:0;margin-bottom:0">Current portion of long-term debt</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,316</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,797</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Long-term debt &#150; net of current portion</p>
 </td>
 <td   colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:2.9pt'>
 <p align=right style='text-align:right;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0">69,542</p>
 </div>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:2.9pt'>
 <p align=right style='text-align:right;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0">93,516</p>
 </div>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt;height:9.0pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Total debt</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">86,059</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 4.5pt 0in 4.5pt;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">112,313</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style='margin-left:9.0pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Stockholders&#146; equity</p>
 </td>
 <td   colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:2.9pt'>
 <p align=right style='text-align:right;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0">106,173</p>
 </div>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' background:#D9D9D9;
 padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:2.9pt'>
 <p align=right style='text-align:right;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0">79,595</p>
 </div>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 4.5pt 0in 4.5pt'>
 <p style="margin-top:0;margin-bottom:0">Total capitalization</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:double windowtext 2.25pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:2.9pt'>
 <p align=right style='text-align:right;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0">Php192,232</p>
 </div>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 4.5pt 0in 4.5pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' background:#F3F3F3;
 padding:0in 4.5pt 0in 4.5pt'>
 <div style='border:none;border-bottom:double windowtext 2.25pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:2.9pt'>
 <p align=right style='text-align:right;border:none;
 padding:0in' style="margin-top:0;margin-bottom:0">Php191,908</p>
 </div>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As at December 31, 2006, consolidated cash and cash
equivalents amounted to Php16,870 million.  Our principal sources of
consolidated cash in 2006 were cash flows from operating activities amounting
to Php61,201 million, drawings from existing long-term credit facilities
totaling Php18,883 million, and net equity funds raised through the issuance of
capital stock amounting to Php66 million.  These funds were used principally
for capital expenditures of Php20,348 million (including capitalized interest
of Php549 million) and total debt principal repayments of Php38,520 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Principal sources of consolidated
cash in 2005 and 2004 were cash flows from operating activities amounting to
Php66,280 million and Php63,107 million, respectively; drawings from long-term
and short-term credit facilities amounting to Php10,797 million and Php329
million, respectively in 2005, and to Php15,187 million and Php457 million,
respectively, in 2004; and equity funds raised through the issuance of capital
stock amounting to Php334 million in 2005 and Php281 million in 2004.  These
funds were used principally for capital expenditures of Php15,864 million
(including capitalized interest of Php504 million) and payments of long-term
and short-term debt totaling to Php48,236 million in 2005; and capital
expenditures of Php19,268 million (including capitalized interest of Php595
million) and payments of long-term and short-term debt totaling to Php44,109
million in 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Operating Activities</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">On
a consolidated basis, net cash flows from operating activities in 2006 amounted
to Php61,201 million, a decrease of Php5,079 million, or 8%, from Php66,280
million in 2005 and an increase of Php3,173 million, or 5% from Php63,107
million in 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">A
growing portion of our consolidated cash flow is generated by our wireless and
data businesses.  The revenue contribution of these businesses has grown significantly
over the last three years with wireless business contributing 63%, in 2006, 62%
in 2005 and 61% in 2004, and data business contributing an average of 11% in
2006, 8% in 2005 and 6% in 2004 of our total service revenues.  Revenues from
our local exchange service accounted for approximately 13% of our total service
revenues in 2006, down from 16% in 2005 and from 17% in 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Cash flows from operating activities of our wireless
business in 2006 accounted for 60% of our consolidated cash flows from operating
activities owing to the growth of our cellular subscriber base and service
usage.  Our fixed line business contributed 38% to our consolidated cash flows
from operating activities in 2006 with improved collection efficiency and lower
cash expenses in line with our cost-containment efforts.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Until April 2006, Smart was subject to
loan covenants that restricted its ability to pay dividends, redeem preferred
shares, make distributions to PLDT or otherwise provide funds to PLDT or any
associate without the consent of its lenders.  Smart was able to obtain waivers
from Finnvera and certain of its lenders for each of the dividend payments made
by Smart to PLDT in March 2006, 2005, 2004, 2003 and 2002 aggregating Php7,000
million, Php19,717 million, Php16,100 million, Php6,166 million and Php1,540
million, respectively.  In 2005, Smart redeemed 380.8 million preferred shares
previously issued to PLDT at a redemption price of Php13.875 per share, or a
total redemption price aggregating to Php5,283 million. </p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Payments made by Smart to PLDT after
April 2006 did not require prior creditor consent as all loan facilities that
contained such restrictions had already been repaid.  In June 2006, September
2006 and March 2007, dividend payments received from Smart amounted to Php7,000
million, Php6,600 million and Php8,000 million, respectively.  In addition,
Smart redeemed 392 million preferred shares at a total redemption price of
Php5,441 million in June 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Investing Activities</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
net cash used in investing activities in 2006 amounted to Php36,764 million, an
increase of Php23,684 million, or 181%, compared to Php13,080 million in 2005
and a decrease of Php11,684 million, or 47%, from Php24,764 million in 2004.
The increase in 2006 primarily resulted from higher business acquisition
expenditures by Php10,770 million, higher capital expenditures by Php4,484
million and an increase in short-term investments of Php6,714 million.  The
decrease in 2005 resulted from a decline in capital expenditures by Php3,404
million, lower business acquisition expenditures by Php1,028 million, higher
cash receipts for leased deposits and a decrease in short-term investments of
Php3,418 million largely due to the maturity of Smart&#146;s investments in 2004.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
consolidated capital expenditures in 2006 totaled Php20,348 million, an increase
of Php4,484 million, or 28%, from Php15,864 million in 2005 primarily due to
Smart&#146;s and PLDT&#146;s higher capital spending.  Smart's capital spending of Php10,506
million in 2006 was used to roll-out its 3G network and further expand and
upgrade its transmission network facilities to increase capacity and coverage
in respect of basic and advanced cellular services.  PLDT's capital spending of
Php8,573 million in 2006 was principally used to finance the expansion of its
fixed line data and IP-based network services.  ePLDT and its subsidiaries&#146;
capital spending of Php1,134 million in 2006 was used to primarily fund its <i>Vitro</i>TM, Digital
Paradise and call center business operations.  The balances were spent by other
subsidiaries mainly PLDT Global, Mabuhay Satellite and Maratel.  In addition,
in 2006, we made certain strategic investments, including the acquisition of SPi
and a 60% equity interest in Level Up! for Php8,847 million and Php347 million,
respectively.  Our consolidated capital expenditures in 2005 totaled Php15,864
million, a decrease of Php3,404 million, or 18%, from Php19,268 million in 2004
primarily due to Smart&#146;s and PLDT&#146;s lower capital spending.  Smart's capital
spending of Php8,785 million in 2005 was used to roll-out its 3G network and
further expand and upgrade its transmission network facilities to increase
capacity and coverage in respect of basic and advanced cellular services.
PLDT's capital spending of Php6,389 million in 2005 was principally used to
finance the expansion of its fixed line data and IP-based network services.
ePLDT and its subsidiaries&#146; capital spending of Php605 million in 2005 was used
to primarily fund its <i>Vitro</i>TM, Digital Paradise and call center business
operations.  The balances were spent by other subsidiaries mainly PLDT Global,
Mabuhay Satellite and Maratel.  In addition, in 2005, we made certain strategic
investments aggregating Php248 million to strengthen our position in the
wireless and information and communications technology segments.&nbsp; Of the
Php248 million investment, Php238 million represented Smart's partial payment
of its investment in a wireless broadband and data service company, and Php10
million pertained to ePLDT's investment in convertible debt securities of a
company engaged in a systems integration of Internet and mobile telephone
gaming project.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As part of our growth strategy, we may from time to
time,
continue to make acquisitions and
investments in companies or businesses, which may or may not be significant.  </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">For 2007, we anticipate increasing
the level of our capital expenditures and equity investments.  Our 2007 budget
for consolidated capital expenditures is approximately Php21,400 million, of
which approximately Php11,100 million is budgeted to be spent by PLDT,
approximately Php8,800 million is budgeted to be spent by Smart and the balance
represents the budgeted capital spending of our other subsidiaries.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Financing Activities</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On a
consolidated basis, we used net cash of Php36,916 million for financing activities
in 2006, compared to Php49,470 million in 2005 and Php30,325 million in 2004.
The net cash used in financing activities in 2006, 2005 and 2004 was mainly
attributable to debt repayments and interest payments by PLDT in line with its
ongoing debt reduction program and, in 2006 and 2005, dividend payments
distributed to common and preferred stockholders.  </p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Debt
Financing</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Additions
to our consolidated long-term debt in 2006 totaled Php18,883 million mainly
from Smart's drawings related to the financing of its Phases 8 and 9 GSM
facilities.  Payments in respect of principal of our total debt amounted to Php38,391
million in 2006, of which Php25,875 million were attributable to PLDT.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK16"></a><a name="OLE_LINK15">&nbsp;</a></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Our
consolidated indebtedness as at December 31, 2006 was Php86,059 million, lower
by Php26,254 million, or 23%, compared to Php112,313 million as at December 31,
2005 mainly due to the reductions of Php25,875 million and Php11,544 million in
PLDT&#146;s and Smart&#146;s indebtedness, respectively.  PLDT&#146;s non-consolidated
indebtedness decreased by 28%, from Php74,028 million as at December 31, 2005
to Php52,936 million as at December 31, 2006, due to debt payments in line with
our thrust to reduce PLDT&#146;s overall indebtedness.  Smart&#146;s indebtedness as at
December 31, 2006 stood at Php30,783 million, a decrease of 12% from Php35,079
million as at December 31, 2005.  On July 2, 2004, Smart acquired from Piltel&#146;s
creditors US$289 million, or 69.4%, in the aggregate of Piltel&#146;s total
outstanding restructured debt at that time, in exchange for US$283.2 million,
or Php13,892 million in July 2, 2004, in new debt of Smart and US$1.5 million,
or Php84 million, in cash.  On June 5, 2006 and December 4, 2006, Piltel
prepaid its entire restructured debt to Smart and Piltel&#146;s other creditors.  Please
see <i>Note 12 &#150; Interest-bearing Financial Liabilities </i>to the accompanying
consolidated financial statements in Item 18 for further details.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, Smart had several committed dollar-denominated and
peso-denominated long-term credit facilities.  On July 31, 2006, Smart signed a
U.S. Dollar Term Loan Facility for US$44.2 million with Finnish Export Credit
Plc to partly finance the related Phase 9 GSM equipment and services
contracts.  The facility was drawn on November 10, 2006 for the full amount of
US$44.2 million.  On August 14, 2006, Smart signed a Peso Term Loan Facility
with Metropolitan Bank and Trust Company to finance the related Phase 9 GSM
facility for an amount of Php2,500 million.  The facility was drawn on December
10, 2006 for the full amount of Php2,500 million.  On October 16, 2006, Smart
signed a U.S. Dollar Term Loan Facility with Metropolitan Bank and Trust
Company to finance the related Phase 9 GSM Facility for an amount of US$50
million.  On February 15, 2007, Smart issued Php5,000 million unsecured fixed
rate corporate notes, comprised of Series A notes amounting to Php3,800 million
and Series B notes amounting to Php1,700 million with five- and ten-year terms,
respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
scheduled maturities of our outstanding consolidated long-term debt as at
December 31, 2006 are as follows:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:441.0pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>US$ Loans</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Peso Loans</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.75pt'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.75pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt;height:10.75pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=7 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:10.75pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 </td>
 <td  style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$327</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php16,027</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php289</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php16,316</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">147</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,203</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">556</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,759</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">294</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,423</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">555</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,978</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2010</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">71</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,468</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,366</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,834</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2011 </p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">724</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">555</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,279</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2012 and onwards</p>
 </td>
 <td  style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">829</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,692</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,692</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$1,681</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php82,537</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php3,321</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php85,858</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Approximately Php45,166 million principal amount of
our consolidated outstanding long-term debt as at December 31, 2006 is scheduled
to mature over the period from 2007 to 2011.  Of this amount, Php25,175 million
was attributable to PLDT, Php14,543 million to Smart, and the remainder to
Mabuhay Satellite, Maratel, ePLDT and Piltel.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">See <i>Note 12 &#150; Interest-bearing
Financial Liabilities</i> to the accompanying consolidated financial statements
in Item 18 for an overview of our indebtedness. </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='line-height:normal' style="margin-top:0;margin-bottom:0"><i>Debt Covenants</i></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our debt instruments contain
restrictive covenants, including covenants that could prohibit us from paying
dividends on common stock under certain circumstances, and require us to comply
with specified financial ratios and other financial tests, calculated in
conformity with PFRS, at relevant measurement dates, principally at the end of
each quarterly period.  We have maintained compliance with all of our
maintenance financial ratios as required under our loan covenants and other
debt instruments.  However, if negative factors adversely affect our financial
ratios, we may be unable to maintain compliance with these ratios and covenants
or be unable to incur new debt.  The terms of some of our debt instruments have
no minimum amount for cross-default.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK44"></a><a name="OLE_LINK41">The principal factors that can
negatively affect our ability to comply with the financial ratios and other
financial tests under our debt instruments are depreciation of the Philippine
peso relative to the U.S. dollar, poor operating performance of PLDT and our
consolidated subsidiaries, impairment or similar charges in respect of
investments or other long-lived assets that may be recognized by PLDT and its
consolidated subsidiaries and increases in our interest expenses.  Interest
expenses may increase as a result of various factors including issuance of new
debt, the refinancing of lower cost indebtedness by higher cost indebtedness,
depreciation of the Philippine peso, the lowering of PLDT&#146;s credit ratings or
the credit ratings of the </a>Philippines, increase in reference interest
rates, and general market conditions.  Since approximately 96% of our total
consolidated debts were denominated in foreign currencies, principally in U.S.
dollars, many of these financial ratios and other tests are negatively affected
by any weakening of the peso.  The peso has been subject to significant
fluctuations in recent years.  From 2002 to 2004, the peso has generally been
depreciating from a high of Php49.336 on May 20, 2002 to a low of Php56.443 on
October 14, 2004.  In 2005, the peso fluctuated significantly from a low of
Php56.321 on July 8 to a high of Php53.062 on December 29.  As at December 31,
2006, the peso had appreciated by 8% to Php49.045 to US$1.00, from Php53.062 to
US$1.00 as at December 31, 2005.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT&#146;s
ability to maintain compliance with financial covenant requirements measured on
a non-consolidated basis is principally affected by the performance of its
fixed line business, which is predominantly conducted by PLDT.  PLDT cannot be
assured of the benefit of net revenues and cash flows generated by Smart and
PLDT&#146;s other investees in assisting PLDT in complying with non-consolidated
covenants or covenants that are calculated without giving effect to the results
of PLDT&#146;s investees.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:27.35pt' style="margin-top:0;margin-bottom:0">PLDT&#146;s debt instruments contain a number of other
negative covenants that, subject to certain exceptions and qualifications,
restrict PLDT&#146;s ability to take certain actions without lenders&#146; approval,
including: (a) incurring additional indebtedness; (b) prepaying other debt; (c)
making investments; (d) extending loans; (e) extending guarantees or assuming
the obligations of other persons; (f) paying dividends or other distributions
or redeeming, repurchasing or otherwise acquiring shares of PLDT&#146;s capital
stock; (g) disposing of all or substantially all of its assets or of assets in
excess of specified thresholds of its tangible net worth; (h) creating any lien
or security interest; (i) permitting set-off against amounts owed to PLDT; (j)
merging or consolidating with any other company; (k) entering into transactions
with stockholders and affiliates; and (l) entering into sale and leaseback
transactions. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Moreover,
certain of PLDT&#146;s debt instruments restrict PLDT from declaring or distributing
dividends to common stockholders.  In particular, under certain loan
agreements, PLDT may not declare or pay dividends on any of its capital stock
without the prior written consent of the lenders (i) if PLDT is in default in
the payment of any amounts due and payable under such loan agreement or after
the occurrence and during the continuance of any other event of default or
potential event of default under such agreements, or (ii) in an amount greater
than PLDT&#146;s net income after taxes during the fiscal year to which such payment
or distribution relates.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">In case of a change in control of PLDT, under the terms
of the 11.375% Notes due 2012, we are required to offer to purchase outstanding
notes due 2012 for cash at a price of 101% of their principal amounts plus
accrued interest in the event that (1) the aggregate of NTT Communications&#146; and
First Pacific&#146;s direct and indirect voting interest in PLDT's outstanding
capital stock having voting rights falls below 35% of such capital stock, (2)
any person or, in certain instances, group of persons, which is not controlled
directly or indirectly by First Pacific or NTT Communications acquires a direct
or indirect voting interest in PLDT&#146;s outstanding capital stock having voting
rights which equals or exceeds 35% of such capital stock and (3) if a rating
agency at such time maintains a rating on such notes, the rating agency
downgrades its credit rating on the notes within 90 days (or more, in certain
circumstances) following notice of the occurrence of the events specified in
(1) and (2) above.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT&#146;s
debt instruments also contain customary and other default provisions that
permit the lender to accelerate amounts due or terminate their commitments to
extend additional funds under the debt instruments. These default provisions
include: (a) cross-defaults and cross-accelerations that permit a lender to
declare a default if PLDT is in default under another debt instrument; in some
cases, the cross-default provision is triggered upon a payment or other default
permitting the acceleration of PLDT&#146;s debt, whether or not the defaulted debt
is accelerated.  In other cases, the cross-default provision requires the
defaulted loan to be accelerated.  In some debt instruments, the cross-default
provision will be triggered only if the principal amount of the defaulted
indebtedness exceeds a threshold amount specified in these debt instruments;
(b) failure by PLDT to meet certain financial ratio covenants referred to
above; (c) the occurrence of any material adverse change in circumstances that
a lender reasonably believes materially impairs PLDT&#146;s ability to perform its
obligations under its debt instrument with the lender; (d) the revocation,
termination or amendment of any of the permits or franchises of PLDT in any
manner unacceptable to the lender;<br>
 (e) the abandonment, termination or amendment of the project financed by a
loan in a manner unacceptable to the lender; (f) the nationalization or
sustained discontinuance of all or a substantial portion of PLDT&#146;s business;
and<br>
 (g) other typical events of default, including the commencement of bankruptcy,
insolvency, liquidation or winding up proceedings by PLDT.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart&#146;s debt instruments contain certain restrictive
covenants that require Smart to comply with specified financial ratios and
other financial tests at semi-annual measurement dates.  The financial tests
under Smart&#146;s loan agreements include compliance with a debt to equity ratio of
not more than 1.50:1 and a debt service coverage ratio of not less than
1.50:1.  Smart has maintained compliance with all of its financial covenants.
The agreements also contain customary and other default provisions that permit
the lender to accelerate amounts due under the loans or terminate their
commitments to extend additional funds under the loans.  These default
provisions include: (a) cross-defaults and cross-accelerations that permit a
lender to declare a default if Smart is in default under another loan agreement.
 These cross-default provisions are triggered upon a payment or other default
permitting the acceleration of Smart debt, whether or not the defaulted debt is
accelerated; (b) failure by Smart to comply with certain financial ratio
covenants; (c) any reduction in PLDT&#146;s ownership of Smart&#146;s shares below 51%;
(d) any reduction in First Pacific&#146;s and Metro Pacific Corporation&#146;s collective
direct and/or indirect ownership of PLDT&#146;s common stock below 17.5% of the
total common stock outstanding; and (e) the occurrence of any material adverse
change in circumstances that the lender reasonably believes materially impairs
Smart&#146;s ability to perform its obligations under its loan agreements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, convertible bonds with a principal amount of US$0.7
million had fallen due for payment and had not been paid.  These bonds
represent sole unrestructured borrowings of Piltel.  Piltel&#146;s failure to redeem
the convertible bonds when they fell due does not cause a default under the
debt arrangements of any other member of the PLDT group.  Piltel is working to
identify the holders of convertible bonds so that it can finalize redemption
arrangements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">The Credit and Omnibus Agreements of Mabuhay Satellite
imposes several negative covenants.  In particular, these covenants, among
other things, restrict material changes in Mabuhay Satellite&#146;s nature of
business and ownership structure, any lien upon or with respect to any of its
assets or to any right to receive income, acquisition of capital stock,
declaration and payment of dividends, merger, consolidation and sale with
another entity and incurring or guaranteeing additional long-term debt beyond
prescribed amounts.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">ePLDT&#146;s
loan agreement imposes negative covenants which, among other things, restrict
ePLDT in regard to payment of cash dividends or any other income or any capital
distribution to PLDT, voluntary suspension of its entire business operations
for a period of 60 consecutive days, dissolution of its legal existence, and
creation of any encumbrances on the shares pledged.  One of ePLDT&#146;s loan
agreements also requires ePLDT to comply with specified financial ratios and
other financial tests at quarterly measurement dates.  The agreement also
contains customary and other default provisions that permit the lender to
accelerate amounts due under the loan or terminate their commitments to extend
additional funds under the loan.  As at December 31, 2006, ePLDT was in
compliance with all of its financial covenants.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Financing Requirements</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
believe that our available cash, including cash flow from operations, will
provide sufficient liquidity to fund our projected operating, investment,
capital expenditures and debt service requirements for the next 12 months.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Since
2002, we have been utilizing internally generated cash, particularly from our wireless
business, to reduce our overall level of indebtedness.  In line with this
objective, we have managed our capital expenditures, reduced our investments
and suspended dividend payments to common shareholders from April 2001 to
2004.  As a result of our improving cash flows and reduced debt levels, we have
restored the payment of common dividends in May 2005 and currently intend to
gradually increase our dividend payout ratio in succeeding years as we expect
to improve our leverage ratios.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Credit Ratings</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">None of our existing
indebtedness contains provisions under which credit rating downgrades would
trigger a default, changes in applicable interest rates or other similar terms
and conditions.  </p>

<p align=left style='text-align:left;line-height:8.0pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:431.1pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>Rating Agency</u></b></p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>Credit Rating</u></b></p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>Outlook</u></b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Standard and Poor&#146;s</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Foreign Currency Senior Unsecured Debt Rating</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">BB+</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Moody&#146;s Investors Service</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Foreign Currency Senior Unsecured Debt Rating</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Ba2</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Local Currency Corporate Family Rating</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Baa3</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Positive</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Fitch</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Long-term Foreign Currency
 Rating</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">BB</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Long-term Local Currency
 Rating</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">BB+</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Long-term Foreign Currency
 Issuer Default Rating</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">BB+</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Long-term Local Currency
 Issuer Default Rating</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">BBB-</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Positive</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">National Long-term Rating </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">AAA(ph1)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stable</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
May 31, 2007, Moody&#146;s Investor Service, or Moody&#146;s, upgraded PLDT&#146;s local
currency corporate family rating to Baa2 from Baa3.  This concludes the
possible upgrade that commenced on April 11, 2007.  At the same time, Moody&#146;s
affirmed PLDT&#146;s Ba2 foreign currency bond rating.  The outlook on the ratings
is stable.  The ratings reflect PLDT&#146;s continued improvements in its financial
profile, a strong operating performance and a dominant market position.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
November 3, 2006, Moody&#146;s affirmed PLDT&#146;s Ba2 senior unsecured foreign currency
rating and changed its outlook to stable from negative.  The rating action was
prompted by the change in outlook on the Philippines Ba3 country ceiling for
foreign currency bonds to stable from negative.  On July 18, 2006, Moody&#146;s
upgraded PLDT&#146;s local currency corporate family rating from Ba1 to Baa3 with a
positive outlook.  The upgrade has been prompted by the following features: (1)
continued improvements in PLDT&#146;s credit profile; (2) PLDT enjoys a lowly geared
balance sheet; (3) PLDT has a 65% share in revenue terms of the market where
only one major competitor is present; and (4) PLDT has sufficient flexibility
to be able to invest its free cash flows into upgrading its technology base.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
August 18, 2006, Fitch upgraded PLDT&#146;s long-term foreign currency IDR to &#147;BB+&#148;
from &#147;BB&#148; with a stable outlook, at the same time upgrading PLDT&#146;s global bonds
and senior notes to &#147;BB+&#148; from &#147;BB&#148; and affirmed PLDT&#146;s long-term local
currency IDR of &#147;BBB-&#148; with a positive outlook.  Following the licensing of
Fitch to provide National ratings in the Philippines, Fitch assigned PLDT a
National long-term rating of &#147;AAA(ph1)&#148; with a stable outlook.  The ratings
action follows Fitch&#146;s announcement that it has upgraded the Country Ceiling on
the Republic of the Philippines to &#147;BB+&#148; from &#147;BB.&#148;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
August 30, 2006, Standard &amp; Poor&#146;s Ratings Services affirmed its &#145;BB+&#146;
foreign currency rating on PLDT with stable outlook.  At the same time, the
rating on PLDT&#146;s Series III Preferred Stock has been withdrawn as the preferred
stock have been fully converted into common equity.  The rating reflects PLDT&#146;s
leading market position and its improving financial profile.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Off-balance Sheet Arrangements</i></p>

<p align=left style='text-align:left;line-height:8.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">There are no
off-balance sheet arrangements that have or are reasonably likely to have any current or
future effect on our financial position, results
of operations, cash flows, changes in stockholders&#146;
equity, liquidity, capital
expenditures or capital resources that are material to investors.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Equity Financing</i></p>

<p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT raised Php63 million and Php275 million from the
exercise by certain officers and executives of stock options in 2006 and 2005,
respectively.  In addition, through our subscriber investment plan, or SIP,
which provides postpaid fixed line subscribers the opportunity to buy shares of
our 10% cumulative convertible preferred stock as part of the upfront payments
collected from subscribers, PLDT was able to raise Php4 million, Php10 million,
Php7 million in 2006, 2005 and 2004, respectively.  </p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Cash dividend payments in 2006 amounted
to Php14,999 million, of which Php14,447 million and Php552 million were paid
to common and preferred shareholders, respectively, compared to Php11,173
million, of which Php9,587 million and Php1,586 million were paid to common and
preferred shareholders, respectively, in 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table sets forth dividend payments on
shares of PLDT&#146;s common stock for 2006 and 2005:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:472.5pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr style='height:9.45pt'>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.45pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.45pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=5 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.45pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Date</b></p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.45pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:9.45pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Class</b></p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Declaration</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Record</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Paid</b></p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Per Share</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Common Stock</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 1, 2005</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 31, 2005</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">May 12, 2005</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php14.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,373</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">May 5, 2005</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">June 3, 2005</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">July 14, 2005</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21.00</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,589</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">November 8, 2005</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">November 28, 2005</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 28, 2005</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,625</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">February 27, 2006</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 20, 2006</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">April 20, 2006</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28.00</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,059</p>
 </td>
 </tr>
 <tr style='height:7.65pt'>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">August 8, 2006</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">August 21, 2006</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">September 21, 2006</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">50.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,346</p>
 </td>
 </tr>
 <tr style='height:7.65pt'>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 6, 2007</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 20, 2007</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">April 20, 2007</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">50.00</p>
 </td>
 <td  valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,388</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, there were 188.4 million PLDT common shares outstanding
compared to 180.8 million common shares outstanding as at December 31, 2005.  See
<i>Note 15 &#150; Stockholders&#146; Equity</i> to the accompanying consolidated
financial statements in Item 18 for further discussion.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Contractual Obligations and Commercial Commitments </i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Contractual Obligations</i></b></p>

<p style='margin-left:9.35pt;text-indent:-9.35pt;line-height:
8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table discloses the PLDT Group&#146;s
contractual obligations outstanding as at December 31, 2006: </p>

<p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Long-term lease
 obligations</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Unconditional purchase</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Other long-term</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Long-term debt</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Operating</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Capital</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>obligations</b><b>(1)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>obligations</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=6 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,316</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">572</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,521</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,972</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23,381</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,759</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">593</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">981</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,629</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,000</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,978</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">564</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">981</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,533</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2010</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,834</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">465</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">981</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,281</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2011</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,279</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">358</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">981</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,618</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2012 and onwards</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,692</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">868</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,962</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">43,522</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">85,858</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,420</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,570</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,858</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,629</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">103,335</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i> (1)</i><i>   Based on the Original Air Time Purchase Agreement
with AIL.</i></p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Long-term
Debt Obligations</i></p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">For a discussion of our long-term debt obligations<i>,</i>
see<i> Note 12 &#150; Interest-bearing Financial Liabilities </i>to the consolidated
financial statements in Item 18<i>.</i></p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Long-term
Operating Lease Obligations</i></p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Digital
Passage Service Contracts.</i>   PLDT has
existing Digital Passage Service Contracts with foreign telecommunication
administrations for several dedicated circuits to various destinations for ten
to 25 years expiring at various dates.  As at December 31, 2006, PLDT&#146;s
aggregate remaining obligation under these contracts amounted to approximately
Php6 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>License
Agreement with Mobius Management Systems (Australia) Pty Ltd., or Mobius.  </i>PLDT entered into a license agreement with Mobius
pursuant to which Mobius has granted PLDT a non-exclusive, non-assignable and
non-transferable license for the use of computer software components.  Under
this agreement, Mobius is also required to provide maintenance services for a
period of one year at no additional maintenance charge.  PLDT may purchase
maintenance services upon expiration of the first year for a fee of 15% of the
current published license fee.  As at December 31, 2006, PLDT&#146;s aggregate
remaining obligation under this agreement was approximately Php10 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Other
Long-term Operating Lease Obligations</i>.
The PLDT Group has various long-term lease contracts for periods ranging from
two to ten years covering certain offices, warehouses, cell sites
telecommunication equipment locations and various office equipment.  In
particular, Smart has lease obligations amounting to Php3,053 million as at December
31, 2006 in respect of office and cell site rentals with over 3,000 lessors
nationwide, PLDT has lease obligations amounting to Php100 million as at
December 31, 2006 in respect of office and lot rentals with over 185 lessors
nationwide, ePLDT has lease obligations amounting to Php238 million as at
December 31, 2006 in respect of certain office space rentals and PLDT Global
has lease obligations amounting to Php13 million as at December 31, 2006 in
respect of certain office space rentals.</p>

<p style='margin-left:9.35pt;text-indent:-9.35pt;line-height:
8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Long-term
Capital Lease Obligations</i></p>

<p style='margin-left:9.35pt;text-indent:-9.35pt;line-height:
8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">For a
discussion of our long-term capital lease obligations, see <i>Note 12 &#150;
Interest-bearing Financial Liabilities </i>to the consolidated financial
statements in Item 18.</p>

<p style='margin-left:9.35pt;text-indent:-9.35pt;line-height:
8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Unconditional
Purchase Obligations</i></p>

<p style='margin-left:9.35pt;text-indent:-9.35pt;line-height:
8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Air
Time Purchase Agreement with AIL.  </i>As
also discussed in<i> Note 16 &#150; Related Party Transactions </i>to the
consolidated financial statements in Item 18, PLDT is a party to a Founder NSP
Air Time Purchase Agreement entered into with AIL in March 1997, which was
amended in December 1998 (as amended, the &#147;Original ATPA&#148;), under which PLDT
was granted the exclusive right to sell AIL services as national service
provider, or NSP, in the Philippines.  In exchange, the Original ATPA required
PLDT to purchase from AIL a minimum of US$5 million worth of air time (the
&#147;Minimum Air Time Purchase Obligation&#148;) annually over ten years commencing on
January 1, 2002 (the &#147;Minimum Purchase Period&#148;), the purported date of
commercial operations of the Garuda I Satellite. In the event that AIL&#146;s
aggregate billed revenue was less than US$45 million in any given year, the
Original ATPA also required PLDT to make supplemental air time purchase
payments not to exceed US$15 million per year during the Minimum Purchase
Period (the &#147;Supplemental Air Time Purchase Obligation&#148;). </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Under
the Original ATPA, the Minimum Air Time Purchase Obligation and the
Supplemental Air Time Purchase Obligation terminated upon the earlier of (i)
the expiration of the Minimum Purchase Period and (ii) the date on which all
indebtedness incurred by AIL to finance the AIL System has been repaid.  AIL
indebtedness consists of: (1) loans with several financial institutions (the
&#147;Banks&#148;) under the Credit Agreement dated March 12, 1997, as amended from time
to time, including the amendment through the rescheduling agreement, dated
September 30, 2002, which extended the principal repayment dates to agreed
periods with the final maturity date on January 31, 2012 (collectively, the
&#147;Amended Credit Agreement&#148;); and (2) amounts owing to MMOC under the Spacecraft
Contract dated August 28, 1995, as amended on December 30, 1998.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As at
December 31, 2006 and 2005, PLDT&#146;s outstanding accrued obligations under the Original
ATPA was Php3,991 million and Php3,493 million, respectively.  Total air time
purchases made under this agreement amounted to Php698 million, Php1,008 million
and Php1,299 million for the years ended December 31, 2006, 2005 and 2004,
respectively. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">AIL
has incurred recurring significant operating losses, negative operating cash
flows, and significant levels of debt.  The financial condition of AIL was
partly due to the NSPs, inability to generate the amount of revenues originally
expected as the growth in subscriber numbers has been significantly lower than
budgeted.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
September 1, 2006, AIL, PT Asia Cellular Satellite, a 95% owned subsidiary of
AIL, and Inmarsat Global Limited, or Inmarsat, reached an agreement to pool
their resources to develop powerful and novel product and service offerings in
the Asian region, founded on their respective mobile satellite communications
networks, with <br>
(a) Inmarsat performing the role of satellite and network operator and
wholesale product and services developer and (b) AIL performing the role of
wholesale and retail distributor of products and services.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Inmarsat
operates a constellation of geostationary satellites that extend mobile phone,
fax and data communications to nearly every part of the world through the
services it offers to end users through its established chain of distribution
partners and satellite communications service providers.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
September 1, 2006, PLDT entered into a gateway services agreement with
Inmarsat, under which PLDT committed to provide gateway infrastructure in Subic Bay up to a maximum amount of US$5 million.  In exchange, PLDT will earn US$0.015 per
minute for interconnection services to be provided to Inmarsat distribution
partners for traffic going through the gateway facility in Subic Bay.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
September 1, 2006, AIL and PT Asia Cellular Satellite entered into a term
sheet, as amended on October 20, 2006 and further amended on November 20, 2006
(the &#147;Bank Term Sheet&#148;), with a majority of the banks to be used as the basis
for further good faith negotiations between the parties thereto with a view to
entering into an agreement further amending the Amended Credit Agreement with
AIL&#146;s bank creditors.  Under the Banks Term Sheet, a majority of the banks
agreed, subject to satisfaction of certain conditions, among other things, to
amend the Original ATPA as set forth in an attachment to the Banks Terms Sheet
and to restructure AIL&#146;s indebtedness.   Pursuant to the business collaboration
arrangements between AIL and Inmarsat, on September 1, 2006, Inmarsat made the
first payment of US$4 million to AIL which was used to pay principal and
interest payable to the banks in accordance with the Banks Term Sheet.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
February 1, 2007, the parties to the Original ATPA entered into an amendment to
the Original ATPA on substantially the terms attached to the Bank Terms Sheet
(the &#147;Amended ATPA&#148;).  Under the Amended ATPA, the Minimum Air Time Purchase
Obligation was amended and replaced in its entirety with an obligation of PLDT
(the &#147;Amended Minimum Air Time Purchase Obligation&#148;) to purchase from AIL a
minimum of US$500,000 worth of air time annually over a period ending upon the
earlier of (i) the expiration of the Minimum Purchase Period and (ii) the date
on which all indebtedness incurred by AIL to finance the AIL System is repaid.
Furthermore, the Amended ATPA unconditionally released PLDT from any
obligations arising out of or in connection with the Original ATPA prior to the
date of the Amended ATPA, except for obligations to pay for billable units used
prior to such date.  Moreover, pursuant to a letter of confirmation, dated February
1, 2007, the banks released and discharged PLDT and ACeS Philippines and their
respective subsidiaries from any and all obligations and liabilities under the
Original ATPA and related agreements. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Moreover,
in accordance with the above contractual arrangements, ACeS Philippines
acquired (i) from LMGT Holdings (ACeS), Inc., or LMGT, 50% of its equity
interest in AIL for a consideration of US$0.75 million pursuant to a sale and
purchase agreement entered into on February 1, 2007 and (ii) from Tera Global
Investment Ltd., or TGIL, for a nominal consideration 50% of TGIL&#146;s interest in
a promissory note issued by AIL, which 50% interest represents an aggregate
amount of US$44,743,752, or the Transferred AIL Note, together with related
security interests pursuant to sale agreement entered into on February 1,
2007.  Immediately thereafter, a portion of the Transferred AIL Note was
converted into shares of AIL and the balance was converted into non-interest
bearing convertible bonds of AIL.  As a result of these transactions, ACeS
Philippines owned 36.99% of AIL as at the date of this report.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Other
Long-term Obligations</i></p>

<p style='margin-left:9.35pt;text-indent:-9.35pt;line-height:
8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Mandatory
Conversion and Purchase of Shares</i>.
As discussed in <i>Note 14 &#150; Preferred Stock Subject to Manadatory Redemption</i>
to the consolidated financial statements in Item 18, PLDT had issued a total of
3 million shares of Series V Convertible Preferred Stock, 5 million shares of
Series VI Convertible Preferred Stock and 4 million shares of Series VII
Convertible Preferred Stock in exchange for a total of 58 million shares of
Series K Class I Convertible Preferred Stock of Piltel, pursuant to the debt
restructuring plan of Piltel adopted in June 2001.  As at December 31, 2006,
all Series VII Convertible Preferred Stock had been converted.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Each
share of Series V and VI Convertible Preferred Stock is convertible at any time
at the option of the holder into one PLDT common share.  On the date
immediately following the seventh anniversary of the issue date of the Series V
and Series VI Convertible Preferred Stocks, the remaining outstanding shares
under these series will be mandatorily converted to PLDT common shares.  Under
a put option exercisable for 30 days, holders of common shares received on
mandatory conversion of the Series V and VI Convertible Preferred Stocks will
be able to require PLDT to purchase such PLDT common shares for Php1,700 per
share and US$36.132 per share, respectively.  </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">As at December 31, 2006, 2,675,393 shares of Series V
Convertible Preferred Stock, 4,419,916 shares of Series VI Convertible
Preferred Stock and all of the 3,842,000 shares of Series VII Convertible
Preferred Stock had been voluntarily converted to PLDT common shares.  As at
December 31, 2006, 46,047 shares of Series V and 875,188 shares of Series VI
Convertible Preferred Stocks remained outstanding.  The aggregate value of the
put option based on outstanding shares as at December 31, 2006 was Php1,629
million which is puttable on June 4, 2008, if all of the outstanding shares of
Series V and VI Convertible Preferred Stocks were mandatorily converted and all
the common shares were put to PLDT at that time.  The market value of the
underlying shares of common stock was Php2,349 million, based on the market
price of PLDT common shares of Php2,550.00 per share as at December 31, 2006.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Commercial Commitments</i></b></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">As at December 31, 2006, our outstanding commercial
commitments, in the form of letters of credit, amounted to Php1,546 million.
These commitments will expire within one year.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK22"></a><a name="OLE_LINK21"></a><a
name="_Toc170286162"></a><a name="_Toc75779219"></a><a name="_Toc46082278"><b>Impact of Inflation and Changing Prices</b></a></p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Inflation can be a significant
factor in the Philippine economy, and we are continually seeking ways to
minimize its impact.  In recent periods, however, we do not believe inflation
has had a material impact on our operations.  The average inflation rate in the
 Philippines in 2006 was 6.2%, compared to 7.6% in 2005.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286163"></a><a name="_Toc75779222"></a><a
name="_Toc46082281"><b>Item 6.       Directors,
Senior Management and Employees</b></a><b>
</b></p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286164"></a><a name="_Toc75779223"></a><a
name="_Toc46082282"><b>Directors, Key Officers
and Advisors</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following are the names, ages and periods of
service, of the directors/independent directors of PLDT, all of whom had been
nominated for re-election and were re-elected at the annual meeting of shareholders
that was held on June 12, 2007: </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:441.0pt;border-collapse:collapse'>

 <tr>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b><u>Name</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b><u>Age</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0"><b>Period
 during which<br>
 <u>individual has served as such</u></b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>

 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Manuel V. Pangilinan</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">60</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">November 24, 1998 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Napoleon
 L. Nazareno</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">November 24, 1998 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Helen
 Y. Dee</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">62</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">June 18, 1986 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Ray
 C. Espinosa </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">November 24, 1998 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Tsuyoshi
 Kawashima(1)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">48</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">July 11, 2006 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Tatsu
 Kono</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">March 28, 2006 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Rev.
 Fr. Bienvenido F. Nebres, S.J.*</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">67</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">November 24, 1998 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Corazon S. de la Paz </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">66</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">September 25, 2001 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Ma. Lourdes C. Rausa-Chan(2)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">March 6, 2007 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Oscar
 S. Reyes*</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">61</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">April 5, 2005 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Albert
 F. del Rosario</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">67</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">November 24, 1998 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Pedro
 E. Roxas*</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">March 1, 2001 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Alfred
 V. Ty*</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">39</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-9.6pt' style="margin-top:0;margin-bottom:0">June 13, 2006 to present</p>
 </td>
 </tr>
</table></center></div>

<p style='text-align:justify' style="margin-top:0;margin-bottom:0"><u>___________</u></p>

<p style='margin-left:.5in;text-align:justify;text-indent:-.5in' style="margin-top:0;margin-bottom:0"><i>*    Independent Director</i></p>

<p style='margin-left:.5in;text-align:justify;text-indent:-.5in' style="margin-top:0;margin-bottom:0"><i>(1) Mr. Tsuyoshi Kawashima was elected to fill the
vacancy resulting from Mr. Shigeru Yoshida&#146;s resignation on July 11, 2006.</i></p>

<p style='margin-left:.5in;text-align:justify;text-indent:-.5in' style="margin-top:0;margin-bottom:0"><i>(2) Atty. Ma. Lourdes C. Rausa-Chan replaced Mr.
Antonio O. Cojuangco who resigned effective January 7, 2007.</i></p>

<p style='text-align:justify;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The names, ages, positions and periods of service of
the key officers and advisors of PLDT as at June 12, 2007 are as follows: </p>

<p style='text-align:justify;line-height:6.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:477.0pt;;border-collapse:collapse'>

 <tr>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>Name</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b><u>Age</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>Position(s)</u></b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:18.6pt;text-align:center;
 text-indent:-18.6pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:18.6pt;text-indent:-18.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Period during which</b></p>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>individual has served as such</u></b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>

 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Manuel V. Pangilinan</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">60</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Chairman of the Board</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">February 19, 2004 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Napoleon
 L. Nazareno</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">President and Chief
 Executive Officer</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">February 19, 2004 to present
 </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Ernesto
 R. Alberto</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President<br>
 Corporate Business Head</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">May 15, 2003 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Rene
 G. Ba&#241;ez</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">January 25, 2005 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Chief Governance Officer </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">October 5, 2004 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Anabelle L. Chua </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">46</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Treasurer </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">February 1, 1999 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">February 26, 2002 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Corporate Finance and <br>
 Treasury Head</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">March 1, 1998 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Smart Chief Financial
 Officer </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">December 1, 2005 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Jun
 R. Florencio</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">June 14, 2005 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Audit and Assurance Head </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">September 1, 2000 to
 February 15, 2006</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Internal Audit and Fraud
 Risk Management Head</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">February 16, 2006 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Menardo G. Jimenez, Jr..</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">December 9, 2004 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Corporate Communications and
 Public Affairs Head</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">December 1, 2001 to June 15,
 2004</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Retail Business Head</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">June 16, 2004 to
 present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">George
 N. Lim</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">55</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">February 26, 1999 to present
 </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Network Services Head </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">February 1, 2003 to present </p>
 </td>
 </tr>
 <tr style='height:11.25pt'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:11.25pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Rosalie
 R. Montenegro</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">58</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:11.25pt'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:11.25pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:11.25pt'>
 <p style="margin-top:0;margin-bottom:0">July 10, 2000 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Call Center
 Business Head </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">February 1, 2003 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Alfredo
 S. Panlilio</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">May 8, 2001 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">PLDT Global Corp. President </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">June 16, 2004 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Claro Carmelo P. Ramirez</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">47</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">July 1, 1999 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">International and Carrier <br>
 Business Head</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">June 16, 2004 to December 4,
 2005</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Consumer Affairs Head </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">December 5, 2005 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Ma. Lourdes C. Rausa-Chan</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Corporate Secretary </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">November 24, 1998 to present
 </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President, </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">January 5, 1999 to present </p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Corporate Affairs and Legal</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Services Head</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Victorico
 P. Vargas</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">56</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Senior Vice President<br>
 Human Resources Head</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">February 15, 2000 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">International and Carrier <br>
 Business Head</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">March 1, 2007 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">June
 Cheryl C. Furigay</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">33</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Vice
 President</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">June 14, 2005 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Financial Reporting and<br>
 Controllership Head</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">November 16, 2006 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Christopher
 H. Young</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Chief Financial Advisor</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">November 24, 1998 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Donald
 J. Rae</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">46</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Chief Operations Advisor of
 Smart</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">January 1, 1999
 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Rolando
 G. Pe&#241;a</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Network Services Head of
 Smart</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">September 1, 1994
 to present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Ramoncito
 S. Fernandez</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">50</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Administration and Materials
 Management Head of Smart</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">June 6, 2000 to
 present</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Danilo
 J. Mojica</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">46</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Wireless Consumer Head of
 Smart</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">June 1, 2006 to present</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">Under the Shareholders Agreement
entered into among First Pacific, NTT Communications and NTTC-UK on September 28, 1999, as amended by the Cooperation Agreement dated January 31, 2006, NTT Communications is entitled to nominate two directors to the PLDT board of directors
and First Pacific and its affiliates are entitled to nominate six directors.
The Shareholders Agreement also entitles NTT Communications to nominate two
directors to the board of directors of Smart and, subject to specified
conditions, one member to the board of directors of all other PLDT
subsidiaries.  As a result of the Cooperation Agreement, in respect of NTT
Communications&#146; right to nominate two directors to each of the board of
directors of PLDT and Smart, respectively, NTT Communications and the FP
Parties agreed to vote as a PLDT shareholder, lobby the directors of PLDT and
otherwise use reasonable efforts to procure a shareholders&#146; vote in favor of
replacing on each of the board of directors of PLDT and Smart, respectively,
one NTT Communications nominee with one DoCoMo nominee.  Under the Shareholders
Agreement, NTT Communications is also entitled to appoint members or advisors
of certain PLDT management and board committees, including the audit,
governance and nomination, executive compensation and technology strategy committees
described below under &#147;&#151; Audit, Governance and Nomination, Executive
Compensation and Technology Strategy Committees,&#148; and as a result of the
Cooperation Agreement, the FP Parties and NTT Communications agreed to use
reasonable efforts to procure that DoCoMo be entitled to appoint one
individual, who may be replaced at any time, to attend any board committee of
PLDT as a member, advisor or observer.  Upon NTT Communications, DoCoMo and
their subsidiaries owning in the aggregate 20% or more of the shares of PLDT&#146;s
common stock and for as long as NTT Communications, DoCoMo and their
subsidiaries continue to own in the aggregate 17.5% of the shares of PLDT&#146;s
common stock then outstanding, DoCoMo will be entitled to nominate one
additional DoCoMo nominee to the board of directors of each of PLDT and
Smart.   Under the Shareholders Agreement and the Cooperation Agreement, each
party has agreed, under certain circumstances, to vote its shares of common
stock in favor of the nominees designated by the other parties. For more
information about the Cooperation Agreement, see Item 7. &#147;Major Shareholders
and Related Party Transactions &#150;&#150; Related Party Transactions &#150;&#150; Cooperation
Agreement with First Pacific and certain affiliates, or the FP Parties, NTT
Communications and DoCoMo.&#148;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
business address of Donald J. Rae, Ramoncito
S. Fernandez and Rolando G. Pe&#241;a and
Danilo J. Mojica is Smart Tower II, Ayala Avenue, Makati City, Philippines.  The business address of each of the other directors, key officers and advisors
identified above is the Ramon Cojuangco Building, Makati Avenue, Makati City , Philippines.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following is a brief description of the business experience during the past
five years of each of our directors, key officers and advisors.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Manuel V. Pangilinan</b> is the chairman
of our board and the managing director of First Pacific.  He assumed the
chairmanship of our board in February 2004 after serving as president and chief
executive officer for over five years since November 1998.  During his
presidency, he led the successful transformation of PLDT from a traditional
plain old telephony service (voice) into a convergent voice, data, video
(multi-media) service.  He is the chairman of the Governance and Nomination and
Technology Strategy Committees of PLDT.  He is also the chairman of the boards
of Smart, Piltel, ePLDT and Metro Pacific Investments Corporation.  He also
holds directorships in Metro Pacific Corporation and Landco Pacific
Corporation.  In 2005, he was named &#147;Management Man of the Year,&#148; a prestigious
award that the Management Association of the Philippines bestows on individuals
in the business community or government for attaining unquestioned distinction
in the practice of management and for contributing to the country&#146;s progress.
He was chosen for, among his other achievements, engineering the turnaround of
PLDT and Piltel through a disciplined convergence strategy consisting of
consolidation, diversification and expansion, spearheading PLDT&#146;s emergence as
one of Asia&#146;s most recognized, admired, innovative and best performing
telecommunication companies, spurring investor interest in the Philippines by
bringing First Pacific and other foreign investors into the Philippines, being
an exemplary Filipino capable of effective and ethical leadership and of
competing with the best in the international business community, and for an
outstanding career that spans business, academe, charitable, non-government,
arts and culture, sports and health organizations.  In May 20006, the Office of
the President of the Philippines awarded Mr. Pangilinan the Order of Lakandula
rank of Komandante in recognition of his contributions to the country.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Napoleon L. Nazareno</b> is the president
and chief executive officer of PLDT effective February 19, 2004 and
concurrently the president and chief executive officer of Smart and Piltel,
positions he has held since January 2000 and November 2004, respectively.  He
also serves as a member of the Technology Strategy Committee. He is the
chairman of the boards of I-Contacts Corporation, Wolfpac, Smart Broadband and
Mabuhay Satellite and the president of ACeS Philippines.  He also holds
directorships in Rufino Pacific Tower Condominium Corporation and some
subsidiaries of PLDT, namely, ePLDT and PLDT Global.  His business experience
spans over 30 years and cuts across a broad range of industries, namely,
packaging, bottling, petrochemicals, real estate and, in the last decade,
telecommunications and information technologies.  In August 1995, he served as
president and chief executive officer of Metro Pacific Corporation until
December 1999.  In November 2004, Mr. Nazareno was appointed by President
Gloria Macapagal-Arroyo as Private Sector Representative of the Public-Private
Sector Task Force for the Development of Globally Competitive Philippine
Service Industries.  He was voted Best Chief Executive Officer of the Year in
the Philippines at the 2004, 2005 and 2006 Best-Managed Companies and Corporate
Governance Polls conducted by <i>Asiamoney, </i>one of Asia&#146;s most influential
magazines.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Ms.
Helen Y. Dee</b> is the chairman and
president and/or chief executive officer of Hydee Management &amp; Resources,
Inc., House of Investments, Inc., Tameena Resources, Inc., Grepalife Asset
Management Corporation and Grepalife Fixed Income Fund Corporation.  She is
also chairman of Rizal Commercial Banking Corporation, Landev Corporation,
Manila Memorial Park, Inc., Mapua Information Technology Center, Inc. and
Hi-Eisai Pharmaceuticals, Inc. and the vice-chairman of Pan Malayan Management
and Investment Corporation.  She is the president of Moira Management, Inc. and
YGC Corporate Services, Inc.  She sits on the boards of EEI Corporation, Petro
Energy Resources Corp., Nippon Life Insurance Co., South Western Cement Corp.,
Seafront Resources Corp., Malayan Insurance Co. Inc., MICO Equities, Inc.,
Hermoza Ecozone Development Corporation, La Funeraria Paz, Inc., Honda Cars
Philippines, Inc. and Isuzu Philippines, Inc.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Atty.
Ray C. Espinosa</b> is the president of
ePLDT and the chairman of certain subsidiaries of ePLDT, namely Parlance,
Vocativ, ePLDT Ventus, SPi, Infocom, Digital Paradise, Airborne Access and
Level Up!.  He also serves as a member of the Technology Strategy Committee.  He
is a member of the boards of Cyber Bay Corporation, Nation Broadcasting
Corporation, Lepanto Consolidated Mining Co., Mediaquest Holdings, Inc., Metro
Pacific Resources, Inc., Philippine Telecommunications Investment Corporation
and several other companies.  He is vice-chairman of the PLDT Beneficial Trust
Fund.  Until June 30, 2000, he was a partner and member of the Executive
Committee of the law firm SyCip Salazar Hernandez &amp; Gatmaitan.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Tsuyoshi Kawashima </b>has been the
general manager of the Philippine branch of NTT Communications since April
2005.  He joined NTT Communications in
October 1999 as senior manager of Global Business Development in the Global
Business Division.  Prior to that, he occupied various positions in The
Long-Term Credit Bank of Japan, Ltd. from 1982 to 1998.  Since August 2000, he
has been an Executive Advisor of PLDT.  He serves as a member of the Executive
Compensation Committee and as an advisor to the Audit Committee of the Board of
Directors of PLDT.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Tatsu Kono </b>is the managing director
of the Corporate Sales Department, Corporate Division of DoCoMo.  He joined
DoCoMo in 2000 and served as executive director of the Global Investment Group,
Global Business Department.  Prior to that, he occupied various positions in
Kokusai Denshin Denwa Co., Ltd., or KDD, and became the general manager of the
Sales Promotion Department in 1989, the managing director of the Kyoto Sales
Office in 1990 and the managing director of the Tokyo Sales Office in 1998.  He
serves as a member of the Governance and Nomination and Technology Strategy Committees
and as an advisor to the Audit Committee of the Board of Directors of PLDT.   </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Rev.
Fr. Bienvenido F. Nebres, S.J.</b> is the
president of the Ateneo de Manila University and the vice chairman of the Board
of Trustees of Asian Institute of Management.  He is also a member of the
boards of trustees of several other private educational institutions.  He is
the chairman of the Audit Committee and a member of the Governance and
Nomination Committee of the board of directors of PLDT.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Ms.
Corazon S. de la Paz</b> is the vice
chairman of the Social Security Commission, the president and chief executive
officer of the Social Security System and the chairman of Equitable-PCI Bank.
She is an advisor to the Audit Committee of PLDT.  She has been elected
president of the International Social Security Association, an association
based in Geneva, Switzerland, to serve as such for a three-year term commencing
in September 2004.  Until June 30, 2001, she was the chairman and senior
partner of Joaquin Cunanan &amp; Co., a member firm of PricewaterhouseCoopers
Worldwide.  She is a director of San Miguel Corporation, Ayala Land, Inc.,
Philippine Health Insurance Corporation, Philex Mining Corporation, Philex
Gold, Inc., Republic Glass Holding Corp., PCI Leasing and Finance, Inc., PCI
Capital Corporation, EBC Investment, Inc. and Ionics Circuits, Inc.  She is
also a trustee of several educational and non-profit organizations.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Atty.
Ma. Lourdes C. Rausa-Chan</b> is senior
vice president for corporate affairs and legal services and the general counsel
and corporate secretary of PLDT.  She also serves as corporate secretary of
several subsidiaries of PLDT.  Prior to joining PLDT in November 1998, she was
the group vice president for legal affairs of Metro Pacific Corporation for 11
years.  She has previously served as a director of PLDT from December 1999 to
February 2001 and from June to December 2002 and was elected again on March 6,
2007.   </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Oscar S. Reyes </b>is the Chairman<b> </b>of
Unicapital Securities, Inc. and Link Edge, Inc.  He serves as a member of the
Audit, Governance and Nomination, Executive Compensation and Technology
Strategy Committees of the Board of Directors of PLDT and also holds
directorships in Bank of the Philippine Islands, CEOs, Inc., DMCI Holdings,
Inc., Level Up!, Inc., Manila Water Corporation, Universal Robina Corporation,
Sunlife of Canada (Philippines) and other private corporations.  He was a
member of the Advisory Board of PLDT for four years until April 2005.  Mr.
Reyes was the Country Chairman of the Shell Companies in the Philippines from 1997 to 2001 and concurrently the Managing Director of Shell Philippines
Exploration B.V. until 2002.  From 2002 to 2004, he served as the Management
Adviser of Shell Philippines Exploration B.V. and as CEO Adviser of Pilipinas
Shell Petroleum Corporation.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Albert F. del Rosario</b> is the chairman
of the board of Gotuaco del Rosario and Associates, Inc., Philippine Indocoil
Corporation and Business World Publishing Corporation, the vice chairman of the
board of Asia Traders Insurance Corporation and the president of ADR Holdings,
Inc., ARS Reinsurance Brokers, Inc., Management Association of the Philippines and Philippine Telecommunications Investment Corporation.  From 2001 to 2006,
he served as the Ambassador Plenipotentiary and Extraordinary of the Republic
of the Philippines to the United States of America.  He is also the chairman of
the Board of Trustees of the PLDT Beneficial Trust Fund and the Executive
Compensation Committee of the Board of Directors of PLDT.  Mr. del Rosario also
sits on the boards of Infrontier (Philippines) Inc., Smart Communications
Philippine Holdings, Inc., LMG Chemicals Corporation, Pacific Plaza Condominium
Corporation, Pacific Plaza Towers Condominium Corporation, Six Harmonies
Holdings, Inc., Landco Pacific Corporation and Metro Pacific Investments
Corporation.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Pedro E. Roxas</b> is the chairman and/or
chief executive officer of various business organizations in the fields of
agri-business, sugar manufacturing and real estate development including Roxas
Holdings, Inc., CADP Group Corp., Roxaco Land Corporation and Roxas &amp;
Company, Inc., and is a director of BDO Private Bank.  He serves as a member of
the Audit Committee and Executive Compensation Committee of the Board of
Directors of PLDT.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Alfred V. Ty </b>is the chairman of Asia
Pacific Top Management International Resources Corporation, vice chairman of
Toyota Motor Philippines Corporation, the president of Federalland, Inc. and
the corporate secretary of Metropolitan Bank and Trust Corporation.  He serves
as a member of the Governance and Nomination and Executive Compensation
Committees of PLDT.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Ernesto R. Alberto</b> is senior vice
president for the corporate business group of PLDT.  He has over 20 years of
work experience in the areas of corporate banking, relationship management and
business development.  Prior to joining PLDT in May 2003, he was a vice
president and the group head of the national corporate group of Citibank N.A., Manila from 1996 to 2003, and previously served as vice president and group head of the
relationship management group of Citytrust Banking Corporation.  Mr. Alberto is
a director of several subsidiaries of PLDT.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Rene G. Ba&#241;ez </b>is our chief governance
officer and is a non-voting member of the Governance and Nomination Committee
of PLDT.  He<b> </b>served as
Commissioner of the Philippine Bureau of Internal Revenue from February 2001 to
August 2002.  Prior to that, he was the head of support services and tax management
group of PLDT from January 1999 to January 2001.  He served as group vice
president for Tax Affairs of Metro Pacific Corporation for three years until
December 1998.  He is a non-voting member of the Governance and Nomination
Committee of the Board of Directors of PLDT.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Ms.
Anabelle L. Chua</b> is the treasurer of
PLDT and senior vice president for PLDT&#146;s corporate finance and treasury
sector.  She concurrently serves as the Chief Financial Officer of Smart.  She
was a vice president at Citibank, N.A. where she worked for ten years prior to
joining PLDT in March 1998.  She has over 15 years of work experience in the
areas of corporate finance, treasury, financial control and credit risk
management.  Ms. Chua is currently a director of the Philippine Stock Exchange,
Inc. and several subsidiaries and affiliates of PLDT.  She is also a member of
the board of trustees of the PLDT Beneficial Trust Fund.  </p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Jun R. Florencio</b> is the senior vice
president for PLDT&#146;s internal audit and fraud risk management group.  He has
over 20 years of work experience in the areas of external and internal audit,
credit management, information technology, financial management and
controllership.  He joined PLDT in April 1999 and served as the financial reporting
and control sector head until March 2000.  He then served as audit and assurance
head until he assumed his present position in February 2006.  He held various
positions in the finance organization of Eastern Telecommunications and was the
financial controller of Smart for four years until March 1999.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Menardo G. Jimenez, Jr.</b> is senior
vice president for the retail business group of PLDT and has previously served
as the Officer-in-Charge of the Mobile Consumer Division of Smart.  He managed
various broadcasting and production companies in radio, television and
stage-theater prior to his appointment as corporate communications and public affairs
head of PLDT in December 2001.  His business experience spans more than 20
years in film and cinema, theater, television advertising, publishing,
broadcasting, education and, recently, in the telecommunications sector.  As a
film producer, he came up with internationally recognized and top-grossing
movies and, under Trumpets Theater Company, a company he founded, he produced
top musical plays.  He had a stint at GMA Network, Inc., where he served as
head of creative services and network promotions, during which he produced a
number of international award-winning campaigns for its radio and television
programs.  In 1998, Mr. Jimenez was given the Ten Outstanding Young Men (TOYM)
Award in Manila for Multi-Media Achievement.  In 1999, he received his Ten
Outstanding Young Persons (TOYP) of the World Award for Cultural Achievement in
 Cannes, France.  He won the first CEO (Communications Excellence in
Organizations) Awards given by the International Association of Business
Communicators.  In 2006, his further achievements in handling the retail
business of PLDT and his stint in Smart as Officer-in-Charge for marketing were
recognized by the Agora Awards, which chose him as its Marketing Man of the
Year.  Mr. Jimenez is the President of the TOYM Foundation, a regular speaker
for the Business Matters Foundation and a contributing writer at two major daily
newspapers.  He is a founder of the Philippine Forum, which convenes the young
movers of the Philippine business, government, media, art and other sectors in
a yearly major forum.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
George N. Lim</b> is senior vice
president for the network services group of PLDT.  He has over 25 years of work
experience in telecommunications management.  Prior to his appointment as head
of network services in February 2003, he served as head of network development
and provisioning from February 1999 and as head of marketing from December
1993.  He is a director of some subsidiaries of PLDT and Philippine Home Cable
Holdings, Inc.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Ms.
Rosalie R. Montenegro</b> concurrently
serves as president of Vocativ, Parlance and Ventus, all of which are
wholly-owned subsidiaries of ePLDT engaged in the call center business.  Prior
to her appointment as a senior vice president in July 2000, she served as
consumer banking head of ABN-AMRO Savings Bank and as vice president for remote
banking of ABN-AMRO Consumer Bank, Singapore Regional Office from 1997 to
1999.  She was vice president for global consumer banking (CitiPhone banking)
and service quality director of Citibank N.A. from 1985 to 1996, servicing both
banking and the credit cards businesses.  Ms. Montenegro holds directorships in
several subsidiaries of PLDT and ePLDT.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Alfredo S. Panlilio</b> is a senior vice
president of PLDT and currently serves as the president of PLDT Global Corp.  He
joined PLDT in July 1999 and served as corporate business head until February
2003 and as international carrier business until May 2004.  He has over 15
years of work experience in the field of business development and information
technology.  He held management positions at IBM Philippines, Inc. and was the
vice president for business development of the Lopez Communications Group
(ABS-CBN Broadcasting, Bayan Telecommunications and SKYCable) prior to joining
PLDT in July 1999.  Mr. Panlilio is also a director of several subsidiaries of
PLDT and PLDT Global. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Claro Carmelo P. Ramirez</b> is senior
vice president for the consumer affairs group.  He was the retail business head
from February 2003 to June 2004 and then served as the international and
carrier business head until December 2005.  He is also a director of several
subsidiaries of PLDT.  He has over 20 years of work experience in the field of
marketing.  He has worked as associate director for Colgate Palmolive Company,
Global Business Development in New York, and as marketing director for Colgate
Palmolive Argentina, S.A.I.C.  Prior to his appointment as senior vice
president in July 1999, he was the marketing director of Colgate Palmolive
Philippines, Inc.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Victorico P. Vargas</b> is senior vice
president for human resources management and effective March 1, 2007,
concurrently heads the international and carrier business group of PLDT.  He
has over 20 years of work experience in the area of human resource management with
respect to various industries including insurance, consumer goods, real estate,
banking and finance, and telecommunications/IT.  Prior to joining PLDT in
February 2000, he was the country human resources director of Citibank N.A., Manila, and spent two years outside the Philippines as country human resources director of
Citibank, N.A., Bangkok.  He is also a director of several subsidiaries of PLDT
and is a non-voting member of the Governance and Nomination and Executive
Compensation Committees of the Board of Directors of PLDT.  </p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Ms.
June Cheryl C. Furigay </b>joined
PLDT in June 2000 as an executive trainee in the finance group and then served
as an executive assistant&nbsp;to the corporate finance and treasury sector head
from December 2000 to April 2002.  Prior to being appointed to her present position as vice president and financial reporting and controllership
head in June 2005 and November 2006, respectively,
she was the Head of Financial Reporting and Planning&nbsp;Center.  From 1993 to
1997, she was a Senior&nbsp;Associate in the business audit and advisory group
of SGV &amp; Co.&nbsp; She also serves as director and is the treasurer of several
subsidiaries of PLDT.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Christopher H. Young</b> is our chief
financial advisor.  He worked in PricewaterhouseCoopers in London and Hong Kong
from 1979 until 1987, at which time he joined First Pacific in Hong Kong as group financial controller.  He joined Metro Pacific Corporation in 1995 as
finance director, a position he held until he joined us in November 1998.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Donald J. Rae</b> is the chief operations
advisor to Smart.  He served as the chief operating officer for Time
Telecommunications Sdn. Bhd. in Malaysia prior to joining Smart in January
1999.  He also spent over ten years with Deloitte &amp; Touche Consulting
specializing in the Asian telecommunications sector.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Rolando G. Pe&#241;a </b>is head of the Network
Services Division of Smart.  He was first
vice president for technical operations group at Digitel, where he worked for
five years prior to his appointment as a director for Smart&#146;s local exchange
carrier services in September 1994.  He held various positions in Eastern
Telecommunications Philippines, Inc. from 1982 until 1989.  He has over 22
years of experience in telecommunications operations, regional business and
technical and operations support.  He sits in the boards of Smart, Piltel,
Wolfpac, Netopia, Smart Broadband and Mabuhay Satellite.  </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Ramoncito S. Fernandez </b>is head of the
Administration and Materials Management Division of Smart.  He is also a member of the board of directors of
Smart, Piltel, I-Contact and Wolfpac.  Until June 2000, he was the executive
vice president in charge of marketing, sales and logistics of Starpack
Philippines Corporation.  He has over 15 years of experience in materials
management, industrial marketing and sales. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Mr.
Danilo J. Mojica </b>is head of the Wireless
Consumer Division of<b> </b>Smart.  Prior to joining Smart in June 2006, he was
the general manager and chief operating officer of Cebu Pacific Air, a
wholly-owned subsidiary of JG Summit Group, from 2003 to 2006 and was president
of Rickett Benckiser Indonesia from 1997 to 2003.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286165"></a><a name="_Toc75779224"></a><a
name="_Toc46082283"><b>Terms of Office</b></a></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The directors of PLDT are elected each year to serve
until the next annual meeting of stockholders and until their successors are
elected and qualified.  The term of office of all officers is coterminous with
that of the board of directors that elected or appointed them.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286166"></a><a name="_Toc75779225"></a><a
name="_Toc46082284"><b>Family Relationships</b></a></p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK47"></a><a
name="OLE_LINK46">None of the directors, key officers
and advisors of PLDT has any family relationships up to the fourth civil degree
either by consanguinity or affinity</a>.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286167"></a><a name="_Toc75779226"></a><a
name="_Toc46082285"><b>Compensation</b></a><b> of Key Management Personnel of the PLDT Group</b><b> </b></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
aggregate compensation paid to our key officers and directors named above, as a
group, for 2006 amounted to approximately Php368 million.  </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Each of the directors, including the members of the advisory board of
PLDT, is entitled to a director&#146;s fee in the amount of Php125,000 for each
meeting of the board attended.  Each of the members or advisors of the audit,
executive compensation, governance and nomination and technology strategy committees
is entitled to a fee in the amount of Php50,000 for each committee meeting
attended.</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">There are no agreements between PLDT Group and any of its key
management personnel providing for benefits upon termination of employment,
except for such benefits to which they may be entitled under PLDT Group&#146;s
retirement and incentive plans.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286168"><b>Long-Term
Incentive Plan</b></a><b> </b></p>

<p style='margin-left:0in;text-indent:.5in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
August 3, 2004, PLDT&#146;s Board of Directors approved the establishment of a Long
Term Incentive Plan, or Original LTIP, for eligible key executive officers and
advisors of PLDT and its subsidiaries, which is administered by the Executive
Compensation Committee.  The Original LTIP is a four-year cash-settled share
based plan covering the period from January 1, 2004 to December 31, 2007, or
the Performance Cycle.  The payment of awards was intended to be made at the
end of the Performance Cycle (without interim payments) and contingent upon the
achievement of an approved target increase in PLDT&#146;s common share price by the
end of the performance cycle and a cumulative consolidated net income target for
the Performance Cycle.  </p>

<p style='margin-left:0in;text-indent:.5in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
August 28, 2006, PLDT&#146;s Board of Directors approved, in principle, the broad
outline of the PLDT Group&#146;s strategic plans for 2007 to 2009 focusing on the
development of new revenue streams to drive future growth while protecting the
existing core communications business.  To ensure the proper execution of the
three-year plan, particularly with respect to the manpower resources being
committed to such plans, a new LTIP, or New LTIP, upon endorsement of the
Executive Compensation Committee, was approved by the Board of Directors to
cover the period from January 1, 2007 to December 31, 2009, or New Performance
Cycle.     </p>

<p style='margin-left:0in;text-indent:.5in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As a
result of the establishment of the New LTIP, the Board also approved the early
vesting of the Original LTIP by the end of 2006 for those of its participants
who were invited to join the New LTIP and chose to join.  Participants in the
Original LTIP who were not invited to join the New LTIP, or who were invited
but chose not to join, remained subject to the Original LTIP and its original
vesting schedule. </p>

<p style='margin-left:0in;text-indent:.5in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
Original LTIP cost, including cost for advisors (presented under professional
and other service fees in the statements of income), and cumulative effect of the
adoption of SFAS 123 (R), recognized as an expense as at December 31, 2006 and
2005 amounted to Php3,432 million and Php1,224 million, respectively.  As at
December 31, 2006 and 2005, total Original LTIP liability amounted to Php5,030
million and Php1,880 million, respectively.  </p>

<p style='margin-left:0in;text-indent:.5in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
New LTIP, like the Original LTIP, is a cash plan that is intended to provide
meaningful, contingent, financial incentive compensation for eligible
executives, officers and advisors of the PLDT Group, who are consistent
performers and contributors to the achievement of the long-term strategic plans
and objectives, as well as the functional strategy and goals of the PLDT
Group.  </p>

<p style='margin-left:0in;text-indent:.5in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The New LTIP, like the Original LTIP, is administered by the Executive
Compensation Committee which has the authority to determine (a) eligibility and
identity of participants; (b) the award attributable to each participant based
on the participant&#146;s annual base compensation and taking into account such
participant&#146;s seniority, responsibility level, performance potential, tenure
with the PLDT Group, job difficulty and such other measures as the Committee
deems appropriate; (c) the level of achievement of the performance objectives;
and (d) the actual award payable to each participant based on the level of
achievement of the performance objectives.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286169"></a><a name="_Toc75779227"></a><a
name="_Toc46082286"><b>Executive Stock Option
Plan</b></a></p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">On April 27, 1999 and December 10, 1999, the board of
directors and stockholders, respectively, of PLDT approved the executive stock
option plan covering a total of 1,289,745 shares of common stock and the
amendment of the seventh article of the Articles of Incorporation of PLDT
denying the pre-emptive right of holders of shares of common stock to subscribe
for any issue of the 1,289,745 shares of common stock pursuant to the executive
stock option plan.</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Stock options that
were granted pursuant to the executive stock option plan to management
executives and advisors/consultants of PLDT became fully vested in December
2004.  An option holder may exercise his option to purchase that number of
vested shares of common stock underlying his option, in whole or in part, at
the price at Php814 per share, subject to adjustment upon the occurrence of
specific events described in the executive stock option plan.  The option
exercise period is until December 9, 2009.  The option holder is required to
give written notice of exercise to the executive compensation committee,
indicating the number of vested shares to be purchased, accompanied by payment
in cash of the full amount of the purchase price for those shares.</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK36"></a><a name="OLE_LINK35">As at May 31, 2007, the total number of shares of
common stock allocated for options granted to the chief executive officer,
directors and key officers of PLDT named below, as a group, under the executive
stock option plan was 261,290.</a></p>

<p style='margin-left:0in;text-indent:.5in;line-height:
10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK45"></a><a name="OLE_LINK9"></a><a
name="OLE_LINK8"></a><a name="_Toc170286170"></a><a name="_Toc75779228"></a><a
name="_Toc46082287"><b>Share Ownership</b></a><b> </b></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK34"></a><a name="OLE_LINK33">The
following table sets forth information regarding ownership of our common stock,
preferred stock and executive stock options, as at May 31, 2007, by our
continuing directors, key officers and advisors.  Each individual below owns
less than 1% of our outstanding common and preferred shares. </a></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:93.78%;margin-left:5.5pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.5pt 0in 5.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in;
 margin-left:0in;margin-right:7.25pt'>
 <p align=center style='text-align:center;line-height:94%;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Name
 of Owner</b></p>
 </div>
 </td>
 <td   valign=bottom style=' padding:0in 5.5pt 0in 5.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;line-height:93%;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Shares
 of</b></p>
 <p align=center style='text-align:center;line-height:93%;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Common
 Stock</b></p>
 </div>
 </td>
 <td   valign=bottom style=' padding:0in 5.5pt 0in 5.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;line-height:93%;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Shares
 of</b></p>
 <p align=center style='text-align:center;line-height:93%;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Preferred
 Stock</b></p>
 </div>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <div style='border:none;border-bottom:solid windowtext 1.0pt;padding:0in 0in 1.0pt 0in'>
 <p align=center style='text-align:center;line-height:93%;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Shares
 of Common Stock Underlying Executive</b></p>
 <p align=center style='text-align:center;line-height:93%;
 border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>Stock
 Options</b>(1)</p>
 </div>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p style='text-align:justify;line-height:94%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:93%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:93%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.5pt 0in 5.5pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:93%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Manuel V. Pangilinan</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">217,350</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">360</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Napoleon L. Nazareno</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,427</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">495</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Helen Y. Dee</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">22,055(2)</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">180</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Ray C. Espinosa</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">3,201(3)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">13,042</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt' style='page-break-inside:
 avoid !msorm;height:9.35pt !msorm'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Tsuyoshi Kawashima</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Tatsu Kono</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt' style='page-break-inside:
 avoid !msorm;height:9.35pt !msorm'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Rev. Fr. Bienvenido F. Nebres, S.J </p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">3,078(4)</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Corazon S. de la Paz</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">11,146,310(5)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt' style='page-break-inside:
 avoid !msorm;height:9.35pt !msorm'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Ma. Lourdes C. Rausa-Chan</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">699(3)</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">350</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt 0in 5.5pt 0in 5.5pt !msorm;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Oscar S. Reyes</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">360</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Albert F. del Rosario</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">119,995(3)</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,560</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Pedro E. Roxas</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">540</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Alfred V. Ty</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Ernesto R. Alberto</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Rene G. Ba&#241;ez</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">540</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Anabelle L. Chua</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,778(3)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Jun R. Florencio</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">530</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Menardo G. Jimenez, Jr.</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">George N. Lim</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,756(3)</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">360</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Rosalie R. Montenegro </p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Alfredo S. Panlilio </p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Claro Carmelo P. Ramirez</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,500</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Victorico P. Vargas </p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">180</p>
 </td>
 <td   valign=top style=' background:#E6E6E6;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,878</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">June Cheryl C. Furigay</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Christopher H. Young</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">47,813(3)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Donald J. Rae</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='margin-right:14.45pt;line-height:12.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Rolando G. Pe&#241;a</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Ramoncito S. Fernandez</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">156</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.35pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p style='text-align:justify;line-height:12.0pt' style="margin-top:0;margin-bottom:0">Danilo J. Mojica</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:14.45pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.5pt 0in 5.5pt;height:9.35pt'>
 <p align=right style='margin-right:7.1pt;text-align:right;
 line-height:12.0pt' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
</table></center></div>

<p style='border:none' style="margin-top:0;margin-bottom:0">_____________</p>

<p style='margin-left:13.7pt;text-indent:-13.7pt;line-height:
2.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>As at May 31, 2007, under
PLDT&#146;s ESOP, options to purchase 19,938</i>
<i>shares of common stock for the key
officers listed in the table above remain unexercised.  No options have been
granted to non-executive directors.  All outstanding options are exercisable at
an exercise price of Php814 per share and have an expiration date of December
10, 2009.  All outstanding options were fully vested as at December 10, 2004. </i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(2)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Includes 21,957 PLDT common
shares registered in the name of Hydee Management and Resources, Inc.  As
chairperson and president of Hydee Management &amp; Resources, Inc., Ms. Dee
may exercise voting rights in respect and may be considered to have beneficial
ownership of these shares.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(3)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Includes PLDT common shares
that have been lodged with the Philippine Central Depository, Inc.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(4)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Includes 386 shares of PLDT&#146;s
common stock registered in the name of Ateneo de Manila University and 2,690 shares
of PLDT&#146;s common stock held of record by PCD Nominee Corporation.  As President
of the Ateneo de Manila University, Rev. Fr. Nebres may exercise voting rights
in respect of these shares and may be considered to have beneficial ownership
of these shares</i>.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(5)&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>Includes 5,024,789 PLDT
common shares registered in the name of Social Security System and<b> </b>6,121,520<b>
</b>PLDT common shares held of record by PCD Nominee Corporation.  Ms. De la
Paz, as president and chief executive officer of the Social Security System,
may exercise voting rights in respect of these shares and may be considered to
have beneficial ownership of these shares.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
aggregate number of common and preferred shares directly and indirectly owned
by directors, key officers and advisors listed above, as at May 31, 2007, was 11,597,270
and 5,455 respectively, or 6.148182% and 0.000772% of PLDT&#146;s outstanding common
and preferred shares, respectively. </p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286171"><b>Board
of Directors &#150;&#150; Independent Directors</b></a></p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">At least four of our directors,
namely, Rev. Fr. Bienvenido F. Nebres, S.J., Oscar S. Reyes, Pedro E. Roxas and
Alfred V. Ty, are independent directors who are not officers or employees of
PLDT or any of its subsidiaries, and who are free from any business or other
relationship with PLDT or any of its subsidiaries which could, or could
reasonably be perceived to, materially interfere with the exercise of
independent judgment in carrying out their responsibilities as directors.  The independence standards/criteria are provided in our
By-Laws and Manual on Corporate Governance pursuant to which, in general, a
director may not be deemed independent if such director is, or in the past five
years had been, employed in an executive capacity by us or any company controlling,
controlled by or under common control with us or he is, or within the past five
years had been, retained as a professional adviser by us or any of our related
companies, or he is not free from any business or other relationships with us
which could, or could reasonably be perceived, to materially interfere with his
exercise of independent judgment in carrying out his responsibilities as a
director.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286172"></a><a name="_Toc75779229"></a><a
name="_Toc46082288"><b>Audit, Governance and
Nomination, Executive Compensation and Technology Strategy Committees</b></a></p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our
board of directors is authorized under the by-laws to create committees, as it
may deem necessary.  We currently have four board committees, namely, the
audit, governance and nomination, executive compensation and technology
strategy committees, the purpose of which is to assist our board of directors.
Each of these committees has a board-approved written charter that provides for
such committee&#146;s composition, membership qualifications, functions and
responsibilities, conduct of meetings, and reporting procedure to the board of
directors.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Audit
Committee</i></p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our audit committee is composed
of three members, all of whom are independent directors, namely, Fr. Bienvenido
F. Nebres, S.J., who chairs the committee, Mr. Pedro E. Roxas and Mr. Oscar S.
Reyes.  Mr. Tatsu Kono and Mr. Tsuyoshi Kawashima, who are non-independent
members of our board of directors, Ms. Corazon S. de la Paz and Mr. Roberto R.
Romulo serve as advisors to the audit committee.  All of the members of our
audit committee are financially literate and Ms. Corazon S. de la Paz, an
advisor to the audit committee, is an accounting and financial management
expert.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
provided for in the audit committee charter, the purposes of the audit
committee are to assist our board of directors:</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
in its oversight of PLDT&#146;s
accounting and financial reporting principles and policies and internal audit
controls and procedures;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
in its oversight of the integrity
of PLDT&#146;s financial statements and the independent audit thereof;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
in its oversight of PLDT&#146;s
compliance with legal and regulatory requirements; </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
in its oversight of the external
auditor&#146;s qualifications and independence; and</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
in its oversight of the
performance of the internal auditing organization and the external auditors.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">To
carry its direct responsibility for the appointment, setting of compensation,
retention and removal of the external auditors, the audit committee has the
following duties and powers:</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to review and evaluate the
qualifications, performance and independence of the external auditors and the lead
partner of the external auditors;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to select and appoint the external
auditors and to remove or replace the external auditors;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to review and approve in
consultation with the head of the internal auditing organization and the chief
financial advisor the fees charged by the external auditors for audit and
non-audit services;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to pre-approve all audit and
non-audit services to be provided by and all fees to be paid to the external
auditors;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to ensure that the external
auditors prepare and deliver annually the statement as to independence and
auditors&#146; statement, to discuss with the external auditors any relationships or
services disclosed in such statements that may impact the objectivity,
independence or quality of services of our external auditors and to take
appropriate action in response to such statements to satisfy itself of the
external auditor&#146;s independence;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to ensure that the external
auditors or the lead partner of the external auditors is rotated at least once
every five (5) years; </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to have separate sessions
periodically, with management, with the internal audit organization and with
the external auditors, where deemed appropriate, to surface issues warranting
the attention of the audit committee; and</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
to resolve disagreements between
management and the external auditors regarding financial reporting. </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
audit committee also has the authority to retain or obtain advice from special
counsel or other experts or consultants in the discharge of their
responsibilities without the need for board approval.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Governance and Nomination
Committee</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
governance and nomination committee is composed of five voting and two
non-voting members.  Three of the voting members are independent directors
namely, Fr. Bienvenido F. Nebres, S.J., Mr. Alfred V. Ty and <br>
Mr. Oscar S. Reyes.  Mr. Manuel V. Pangilinan, who serves as chairman, and Mr.
Tatsu Kono are the other voting members, and Mr. Victorico P. Vargas and Mr.
Rene G. Ba&#241;ez are the non-voting members. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The principal functions and
responsibilities of our governance and nomination committee are:</p>

<p style='text-indent:.5in;line-height:6.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To develop and recommend to the board
for approval and oversee the implementation of corporate governance principles
and policies;</p>

<p style='text-indent:.5in;line-height:6.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To review and evaluate the
qualifications of the persons nominated for election as directors (including
independent directors) or other positions requiring board appointment;</p>

<p style='text-indent:.5in;line-height:6.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To identify the qualified nominees
and recommend that the board select and recommend such qualified nominees for
election as directors/independent directors at the annual meeting of
shareholders; and</p>

<p style='text-indent:.5in;line-height:6.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To provide an assessment on our board&#146;s
effectiveness in the process of replacing or appointing new directors or
members of the board committees.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Executive Compensation Committee</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our
executive compensation committee is composed of six members: five voting
members and one non-voting member.  Three of these voting members are
independent directors, namely Mr. Pedro E. Roxas, Mr. Oscar S. Reyes and Mr.
Alfred V. Ty, two are non-independent directors, namely Mr. Tsuyoshi Kawashima
and Mr. Albert F. del Rosario, who serves as chairman, and one is a non-voting
member, namely Mr. Victorico P. Vargas.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The principal functions and responsibilities of our executive
compensation committee are:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To provide guidance to and assist
our board of directors in developing a compensation philosophy or policy
consistent with our culture, strategy and control environment;</p>

<p style='text-indent:.5in;line-height:6.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:0in' style="margin-top:0;margin-bottom:0">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To oversee the development and
administration of our compensation programs; and</p>

<p style='text-indent:.5in;line-height:6.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To review and approve corporate
goals and objectives relevant to the compensation of our chief executive officer,
evaluate the performance of our chief executive officer in light of those goals
and objectives, and set the compensation
level of our chief executive officer based on such evaluation.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Technology Strategy Committee</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Effective
June 12, 2007, our board of directors created a new committee, the technology
strategy committee.  Our technology strategy committee is composed of five
members, all of whom are voting members.  One of the members is an independent
director, namely Mr. Oscar S. Reyes, and four are non-independent directors,
namely <br>
Mr. Manuel V. Pangilinan, who serves as chairman, Mr. Napoleon L. Nazareno, Mr.
Ray C. Espinosa and Mr. Tatsu Kono.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
principal functions and responsibilities of our technology strategy committee
are:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To review and approve our
technology strategy and roadmap, and to review and advise our board on major
technology trends and strategies;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To evaluate and advise our board
on actual and proposed technology investments and transactions;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To review and submit to the board
recommendations regarding management&#146;s formulation and execution, and to
oversee the execution of, our technology strategy; and </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:1.0in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
To recommend to the board
approaches to acquiring and maintaining technology positions and maximizing our
access to relevant technologies, and to ensure optimized contribution of
technology to our business strategy and growth targets.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Finance Committee
Dissolved </i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Effective
June 12, 2007, our board of directors dissolved our finance committee as its
functions had regularly been carried out by the full board of directors for a
prolonged period of time, supplanting the need to continue to maintain a
finance committee.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286173"><b>Directors&#146;
and Officers&#146; Involvement in Certain Legal Proceedings</b></a></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following is a description of the cases in which
our Chairman, Manuel V. Pangilinan, our President and Chief Executive Officer,
Mr. Napoleon L. Nazareno and our directors, Mr. Albert F. del Rosario and <br>
Ms. Ma. Lourdes C. Rausa-Chan are respondents:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">1.      Mr. Manuel V. Pangilinan, in his capacity as
Chairman of the Board of Metro Pacific Corporation, a stockholder of Metro
Tagaytay Land Company, Inc. (&#147;MTLCI&#148;), and four other individuals are
respondents in I.S. 04-A-1057 for alleged violation of Article 315 (1)(b)
(&#147;estafa&#148;) of the Revised Penal Code filed by Mr. Vicente A. Tuason in behalf
of Universal Leisure Club, Inc. (&#147;ULCI&#148;) and Mr. Jose L. Merin in behalf of
Universal Rightfield Property Holdings, Inc. (&#147;URPHI&#148;).  In the complaint-affidavit,
Messrs. Tuason and Merin alleged that, in violation of the trust reposed by
ULCI and certain contractual commitments and representations, MTLCI, with the
participation and/or conformity of the respondents, misappropriated and
converted P139 million that ULCI entrusted for the purpose of incorporating
Golf Land Co., Inc. (&#147;GLCI&#148;), a corporation to be wholly owned by MTLCI and to
which a property of MTLCI was to be transferred in exchange for shares in
GLCI.  The said shares were then supposed to be transferred to ULCI.  Based on
his counsel&#146;s advice, Mr. Pangilinan cannot be held liable for violating
Article 315 (1)(b) of the Revised Penal Code because no document or other
evidence has been presented to prove that Mr. Pangilinan actually participated
in the negotiation, preparation, approval, execution and/or implementation of
the agreement/contract upon which the claims of the complainants are
purportedly based, much less that Mr. Pangilinan, with abuse of trust and
confidence, misappropriated any amounts paid by ULCI to MTLCI.  On March 25,
2004, Mr. Pangilinan submitted his counter-affidavit in I.S. No. 04-A-1057.  In
a Joint Resolution dated June 7, 2004, the City Prosecution Office of Makati
dismissed all charges in the estafa case against Mr. Pangilinan.  On November
16, 2004, ULCI, through Messrs. Tuason and Merin, filed with the Philippine
Department of Justice, or DOJ, a Petition for Review assailing the Resolution
of the City Prosecution Office of Makati.  Subsequently, the complainants and
respondents, including Mr. Pangilinan, filed a Joint Motion to Dismiss (with
prejudice) the charges and counter-charges subject of the investigation, which
motion is pending resolution by the DOJ.</p>

<p align=left style='margin-left:27.35pt;text-align:left;
text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">2.      Mr. Napoleon L. Nazareno is a respondent in
Criminal Case No. 133235-R pending before the 6th Municipal Trial
Court in Cities, Branch 6 of Cebu City, and I. S. No. 2005-57-B pending before
the Municipal Trial Court of Borongan, Samar, all for alleged violation of
Section 301 in relation to Section 213 of Presidential Decree 1096 (otherwise
know as the National Building Code of the Philippines).  The complaints alleged
that Smart built its cellsites without securing building permits and Smart&#146;s
officers are criminally liable therefor.  The proceedings in Criminal Case No.
133235-R and I. S. No. 2005-57-B have been suspended pending the submission by
Smart of a building permit.  To date, the building permits for the sites have
been secured and Smart is set to file the appropriate pleadings for the
dismissal of the cases.</p>

<p align=left style='margin-left:27.35pt;text-align:left;
text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">3.      Messrs. Nazareno and Albert F. del Rosario
and other directors and officers of the former PDCP Bank, are respondents in a
complaint docketed as I.S. No. 2004-631, which was filed by Chung Hing
Wong/Unisteel/Unisco Metals, Inc. with the DOJ, for alleged syndicated estafa,
estafa through falsification of documents, other deceits, misconduct and
robbery.  As stated in their respective counter affidavits, the charges against
the PDCP directors are entirely without merit.  The case is currently pending
with the Philippine DOJ.     </p>

<p align=left style='margin-left:27.35pt;text-align:left;
text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">4.      Mr. del Rosario and other former
directors/officers and corporate secretaries/assistant corporate secretaries,
including Ma. Lourdes C. Rausa-Chan, of Steniel Cavite Packaging Corporation,
Metro Paper and Packaging Products, Inc., AR Packaging Corporation and Starpack
Philippines Corporation, are respondents in a case docketed as OMB
C-C-04-0363-H (CPL No. C-04-1248), in the Office of the Ombudsman.  The
complaint is for alleged:  (a) violation of Republic Act No. 3019 (otherwise
known as the Anti-Graft and Corrupt Practices Act); <br>
(b) estafa through falsification of public documents; (c) falsification of
public documents under Article 171, in relation to Article 172, of the Revised
Penal Code, or RPC; (d) infidelity in the custody of public documents under
Article 226 of the RPC; and (e) grave misconduct.  The complaint related to
various tax credit certificates (allegedly fraudulent, with spurious and fake
supporting documents) issued to Victory Textile Mills, Inc. (allegedly a
non-existent corporation with fictitious incorporators and directors) and
transferred to several companies including the aforesaid companies.  The
complaint against Mr. del Rosario and Ms. Rausa-Chan involves the first two
offenses only and in their capacity as director and corporate secretary,
respectively, of Metro Paper and Packaging Products, Inc.  In the opinion of
the legal counsels for Mr. del Rosario and Ms. Rausa-Chan, there are no legal
and factual bases for their inclusion as respondents in this complaint.  Mr.
del Rosario and Ms. Rausa-Chan had no participation or involvement in the
alleged anomalous acquisition and transfer of the subject tax credit
certificates.  The case is currently pending with the Office of the Ombudsman.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286174"></a><a name="_Toc75779230"></a><a
name="_Toc46082289"><b>Employees and Labor
Relations</b></a></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, we had 28,219 employees within the PLDT Group.  PLDT had
8,526 employees at the end of 2006, of which 44% were rank-and-file employees,
51% were management/supervisory staff and 5% were executives.  This number
represents a decrease of 493 employees, or approximately 6%, from the staff
level as of the end of 2005, mainly as a result of the ongoing manpower
rightsizing program.  From a peak of 20,312 at the end of 1994, PLDT&#146;s number
of employees has declined by 11,786, or 58%, by the end of 2006.  As at December
31, 2005, we had 18,926 and 9,013 employees under the PLDT Group and PLDT,
respectively.  The increase in the number of employees as at December 31, 2006
was primarily due to the acquisition of SPi, CyMed and Level Up!.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT
has three employee unions, the members of which in the aggregate represent 23%
of the employees of the PLDT Group.  We consider our relationship with our
rank-and-file employees&#146; union, our supervisors&#146; union and our sales supervisors&#146;
union to be good.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On November 16, 2006, PLDT and the <i>Manggagawa ng Komunikasyon sa
Pilipinas</i>, or MKP, our rank-and-file employees&#146; union, concluded and signed
a new three-year Collective Bargaining Agreement, or CBA, covering the period
from November 9, 2006 to November 8, 2008.  This CBA provides each member a
signing bonus equivalent to one month&#146;s salary (computed at the salary rate
prevailing prior to November 9, 2007) plus Php15,000; monthly salary increases
of Php2,150, Php2,200 and Php2,550 for the first, second and third year,
respectively; an increase in the yearly Christmas gift certificate from
Php7,000 to Php8,000; an increase in the amount of coverage under the group
life insurance plan from Php500,000 to Php650,000; an additional contribution
of Php1 million to the Educational Loan Fund; and Php35,000 funeral assistance
for death the of a dependent.  Other highlights of this CBA include increases
in the rice subsidy and professional fee for dependent&#146;s hospitalization.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK24"></a><a name="OLE_LINK23">On March 8, 2005, PLDT and PLDT
Sales Supervisors&#146; Union, or PSSU, concluded and signed a new three-year CBA
covering the period from January 1, 2005 to December 31, 2007.  This CBA
provides each member monthly salary increases of 8% of basic pay or Php2,000,
whichever is higher, for the first year; 10% of basic pay or Php2,700,
whichever is higher, for the second year; and another 10% of basic pay or
Php2,400, whichever is higher, for the third year.  Other highlights of this
CBA are improvements of existing benefits and a one-time signing bonus of
Php33,000, including a Php3,000 goodwill bonus, for each member of PSSU.
Furthermore, a Php4,000 one-time clothing accessory allowance was also
provided.</a></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On January 20, 2005, PLDT and <i>Gabay ng Unyon sa Telekomunikasyon ng
mga Superbisor</i>, or GUTS, our supervisors&#146; union, concluded and signed a new
three-year CBA covering the period from January 1, 2005 to December 31, 2007.
This CBA provides each member monthly salary increases of 8% of basic pay or
Php2,000, whichever is higher, for 2005; 10% of basic pay or Php2,700,
whichever is higher, for 2006; and another 10% of basic pay or Php2,400,
whichever is higher, for 2007.  Other highlights of this CBA are improvements
of existing benefits and a one-time signing bonus of Php33,000, including a
Php3,000 goodwill bonus, for each member of GUTS.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286175"></a><a name="_Toc75779231"></a><a
name="_Toc46082290"><b>Pension and Retirement
Benefits</b></a></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Defined Benefit Plans</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">We have defined
benefit pension plans, covering substantially all of our employees, except the
employees of Smart.  The plans require contributions to be made to a separate
administrative fund.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">PLDT has a trusteed,
non-contributory defined benefit plan covering all permanent and regular
employees.  The benefit plan provides benefits upon normal retirement beginning
at age 65, early retirement beginning at age 50 or completion of at least 30
years of credited service, voluntary resignation with completion of at least 15
years of credited service, total and physical disability, death and involuntary
separation.  Benefits are based on the employee's final monthly basic salary
and length of service.</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The normal
retirement benefit is equal to a percentage of the final monthly basic salary
per year of credited service.  The percentage is 100% for those with less than
15 years of service at retirement and 125% for those with 15 years of service
at retirement.  Thereafter, the percentage increases by 5% for every additional
year of credited service up to a maximum of 200%.  Early retirement benefit is
equal to the accrued normal retirement benefit based on salary and service at
the date of early retirement.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
the event the benefit plan's assets were insufficient to pay the required
retirement benefits, PLDT would be obligated to fund the amount of the
shortfall.  In addition, claims of PLDT's employees for retirement benefits
that have accrued would rank above the claims of all other creditors of PLDT,
in the event of PLDT's bankruptcy or liquidation.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">For
more information about the benefit plan, see <i>Note 17 &#150; Employee Benefits </i>to
the accompanying consolidated financial statements in Item 18.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK32"></a><a name="OLE_LINK31"></a><a
name="_Toc170286176"></a><a name="_Toc75779234"></a><a name="_Toc46082293"><b>Item 7.       Major Shareholders and Related Party
Transactions</b></a><b> </b></p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table sets forth information regarding
ownership of shares of PLDT&#146;s common stock as at May 31, 2007 of all
shareholders known to us to beneficially own 5% or more of PLDT shares of
common stock.  All shares of PLDT's common stock have one vote per share.  </p>

<p style='margin-bottom:6.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:499.5pt;margin-left:.9pt;border-collapse:collapse'>
 <tr style='height:29.7pt'>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:29.7pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Title of Class</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:29.7pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Name and Address of Record Owner and Relationship
 with Issuer</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:29.7pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Place of Incorporation</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:29.7pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Name of Beneficial Owner and Relationship with Record
 Owner</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:29.7pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Number of Shares Held</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:29.7pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Percentage of Class</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0"><br>
 Common</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0"><br>
 Philippine Telecommunications Investment Corporation(1) <br>
 12th Floor Ramon Cojuangco Bldg., <br>
 Makati Avenue, Makati City</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0"><br>
 Philippine Corporation</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='line-height:93%;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><br>
 Metro Pacific Assets Holdings, Inc.<br>
 c/o Corporate Secretary</p>
 <p style='line-height:93%;page-break-after:avoid' style="margin-top:0;margin-bottom:0">18th Floor Liberty Center, </p>
 <p style='line-height:93%;page-break-after:avoid' style="margin-top:0;margin-bottom:0">104 H.V. Dela Costa St., </p>
 <p style='line-height:93%;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Salcedo Village, Makati City<br>
 (See Footnote 1 below)<br>
 <br>
 </p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0"><br>
 13,338,415</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0"><br>
 7.07</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Common</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Metro
 Pacific Resources, Inc. (2)<br>
 c/o Corporate Secretary<br>
 18th Floor Liberty Center, <br>
 104 H.V. dela Costa St. <br>
 Salcedo Village, Makati City</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Philippine Corporation</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='line-height:93%;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Metro Pacific Holdings, Inc.<br>
 c/o Corporate Secretary</p>
 <p style='line-height:93%;page-break-after:avoid' style="margin-top:0;margin-bottom:0">18th Floor Liberty Center, </p>
 <p style='line-height:93%;page-break-after:avoid' style="margin-top:0;margin-bottom:0">104 H.V. Dela Costa St., </p>
 <p style='line-height:93%;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Salcedo Village, Makati City<br>
 (See Footnotes 1 and 2 below)<br>
 <br>
 </p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">17,112,534</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">9.07</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Common</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">NTT
 Communications Corporation(3)<br>
 1-1-6 Uchisaiwai-cho<br>
 1-Chome, Chiyoda-ku<br>
 Tokyo 100-8019, Japan</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Japanese Corporation</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Nippon
 Telegraph and Telephone Corporation<br>
 2-3-1 Otemachi<br>
 Chiyoda-ku, TKY 100-8116</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">12,633,487</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">6.70</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Common</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">NTT
 DoCoMo, Inc.(4)<br>
 41st flr Sanno Park Tower<br>
 2-11-1 Nagata-cho, Chiyoda-ku<br>
 Tokyo 100-6150, Japan</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Japanese Corporation</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Nippon
 Telegraph and Telephone Corporation<br>
 2-3-1 Otemachi<br>
 Chiyoda-ku, TKY 100-8116</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">15,987,736</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">8.48</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Common</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Social
 Security System(5)<br>
 SSS Building<br>
 East Avenue, Quezon City</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Philippine Corporation</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Same as Record Owner</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">11,146,309</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">5.91</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Common</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">PCD
 Nominee Corporation(6)<br>
 37/F Enterprise Building, Tower 1<br>
 Paseo de Roxas cor. Ayala Avenue,<br>
 Makati City</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Philippine Corporation</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">See Footnote 6 below</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">87,123,483</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">46.19</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Common</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">J.P. Morgan
 Asset Holdings (HK) Limited(7)<br>
 (various accounts)<br>
 20/F Chater House, 8 Connaught Road <br>
 Central, Hongkong</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">Hongkong Corporation</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">See Footnote 7 below</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">34,902,407</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">18.50</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Common</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0">Capital
 Research and Management Company(8)</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">U.S. Company</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">See Footnote 8 below</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">14,575,690</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;margin-right:
 0in;margin-bottom:6.0pt;margin-left:0in;text-align:center;text-indent:0in' style="margin-top:0;margin-bottom:0">7.73</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><u>                                </u></p>

<p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp; </i><i>Pursuant to a resolution adopted by the Board of
Directors of Philippine Telecommunications Investment Corporation, or PTIC, a
copy of which had been furnished to PLDT, the President of PTIC, Mr. Manuel V.
Pangilinan, has the continuing authority to represent PTIC at any and all
meetings of the stockholders of a corporation in which PTIC owns of record or
beneficially any shares of stock or other voting security, and to sign and
deliver, in favor of any person he may deem fit, a proxy or other power of
attorney, with full power of delegation and substitution, authorizing his
designated proxy or attorney-in-fact to vote any and all shares of stock and
other voting securities owned of record or beneficially by PTIC at any and all
meetings of the stockholders of the corporation issuing such shares of stock or
voting securities.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
0in;margin-left:13.5pt;margin-bottom:.0001pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>First Pacific Group beneficially owned 28% of our
common shares as at May 31, 2007 by virtue of the PLDT common shareholdings by
intermediate holding companies, including PTIC, MPRI, Metro Pacific Assets
Holdings, Inc., and Metro Pacific Holdings, Inc.</i></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
0in;margin-left:13.5pt;margin-bottom:.0001pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
0in;margin-left:13.5pt;margin-bottom:.0001pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>PTIC&#146;s shareholding of 13,338,415 shares excludes the
12,695,848 PLDT shares that have been delivered and lodged with Philippine
Depositary and Trust Co.  The actual percentage of PLDT&#146;s shares held by PTIC,
if the shares delivered and lodged with PCD are included, is 13.8%.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(2)&nbsp; </i><i>Based on the resolution of the Board of Directors of
Metro Pacific Resources, Inc., or MPRI, a copy of which had been furnished to
PLDT, Mr. Manuel V. Pangilinan has been appointed as proxy or duly authorized
representative of MPRI to represent and vote the PLDT shares of common stock of
MPRI in the annual meeting of stockholders of PLDT.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><i>(3)&nbsp; </i><i>Based on publicly available information, NTT
Communications is a wholly-owned subsidiary of Nippon Telegraph and Telephone
Corporation.  Pursuant to the amendment No. 4 to Schedule 13D filed with the
Securities and Exchange Commission on April 18, 2007 by NTT and NTT
Communications, NTT, NTT Communications and DoCoMo as a group beneficially
owned 28,621,223 shares of PLDT common stock.  As certified by our stock
transfer agent, NTT Communications was the record owner of 12,633,487 shares of
PLDT common stock as at May 31, 2007.  Based on a certification signed by a duly
authorized officer of NTT Communications, a copy of which had been furnished to
PLDT, Mr. Jun Sawada  is authorized to execute for and on behalf of NTT
Communications, endorsements, transfers and other matters relating to the PLDT
shares of common stock held by NTT Communications.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(4)&nbsp; </i><i>DoCoMo completed the acquisition of 12,633,486 shares
of PLDT common stock from NTT Communications on March 14, 2006.  Moreover, as
disclosed in its amendment No. 1 to Schedule 13D filed with the Securities and
Exchange Commission on April 18, 2007 (the &#147;DoCoMo Schedule 13D&#148;), from March
20, 2007 through April 16, 2007, DoCoMo acquired through open market purchases an
additional 1,966,062 shares of PLDT common stock.  DoCoMo informed PLDT that
DoCoMo made further open market purchases of shares of PLDT common stock
thereby increasing the number of shares of PLDT common stock held by DoCoMo to
15,987,736 as at May 31, 2007.  Based on publicly available information, DoCoMo
is a majority-owned and publicly traded subsidiary of NTT.  Based on a
certification signed by a duly authorized officer of DoCoMo, a copy of which
had been furnished to PLDT, Mr. Toshinari Kunieda or Mr. Matsuo Yamamoto, is
authorized to execute for and on behalf of NTT DoCoMo, endorsements, transfers
and other matters relating to the PLDT shares of common stock held by DoCoMo.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:4.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(5)&nbsp; </i><i>Social Security System, or SSS, is the record owner of
5,024,789 shares and is the beneficial owner of 6,121,520 shares held of record
by PCD Nominee Corporation as at May 31, 2007.  Please refer to footnote 6.
Pursuant to a resolution of the Board of Directors of the SSS, a copy of which
had been furnished to PLDT, Ms. Corazon S. de la Paz, as President and Chief
Executive Officer of the SSS, has been authorized to represent and vote the
PLDT shares of common stock of SSS in the Annual Meeting.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(6)&nbsp; </i><i>Registered owner of shares held by participants in the
Philippine Depository and Trust Co., or PDTC, a private company organized to
implement an automated book entry system of handling securities transactions in
the Philippines.  Under the PDTC procedures, when an issuer of a PDTC-eligible
issue will hold a stockholders&#146; meeting, the PDTC will execute a pro-forma
proxy in favor of its participants for the total number of shares in their
respective principal securities account as well as for the total number of
shares in their client securities account.  For the shares held in the
principal securities account, the participant concerned is appointed as proxy
with full voting rights and powers as registered owner of such shares.  For the
shares held in the client securities account, the participant concerned is
appointed as proxy, with the obligation to constitute a sub-proxy in favor of
its clients with full voting and other rights for the number of shares
beneficially owned by such clients.  Based on available information, none of
the owners of the PLDT common shares registered under the name of PCD Nominee
Corporation, or PCD, owned more than 5% of PLDT&#146;s outstanding common stock as
at May 31, 2007, except The Hongkong and Shanghai Banking Corp.
Ltd.&#150;Clients, Capital Research and Management Company, Standard Chartered Bank and
Citibank N.A., which own approximately 21.47%, 7.73%, 5.77% and 5.55%,
respectively, of PLDT&#146;s outstanding common stock as at such date.  The Company
has no knowledge if any beneficial owner of the shares under The Hongkong and
Shanghai Banking Corp. Ltd.&#150;Clients and Standard Chartered Bank accounts own
more than 5% of PLDT&#146;s outstanding common stock as at such date.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
0in;margin-left:13.5pt;margin-bottom:.0001pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>The PCD account also includes 6,121,520 shares
beneficially owned by the Social Security System and 11,938,750 shares
beneficially owned by Capital Research and Management Company.  Please refer to
footnotes 5 and 8.</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(7)&nbsp; </i><i>Holds shares as nominee of JPMorgan Chase Bank, successor
depositary under the Common Stock Deposit Agreement, dated October 14, 1994, as
amended on February 10, 2003, between JPMorgan Chase Bank and the holders of
American Depositary Receipts, or ADRs, evidencing American Depositary Shares,
or ADSs, representing shares of common stock of the Company (the &#147;Deposit
Agreement&#148;).  Under the Deposit Agreement, if  the depositary does not receive
voting instructions from a holder of ADRs, such holder will be deemed to have
instructed the depositary to provide a discretionary proxy to a person
designated by PLDT for the purpose of exercising the voting rights pertaining
to the shares of common stock represented by such holder of ADRs, except that
no discretionary proxy will be given with respect to any matter as to which
substantial opposition exists or which materially and adversely affects the
rights of the holders of such ADRs.</i></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
0in;margin-left:13.5pt;margin-bottom:.0001pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
0in;margin-left:13.5pt;margin-bottom:.0001pt;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>This account also includes 2,636,940 shares of common
stock underlying ADSs owned by Capital Research and Management Company.  Please
refer to footnote 8.</i></p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:
0in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><i>(8)&nbsp; </i><i>According to the Schedule 13G of Capital Research and
Management Company, filed with the Securities and Exchange Commission on
February 6, 2007, Capital Research and Management Company, as an investment
adviser, beneficially owned 14,575,690 shares of PLDT common stock, including
2,636,940 shares of PLDT common stock represented by ADSs as at December 29,
2006.  Please refer to footnotes 6 and 7 for further discussion.</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">As at May 31, 2007, approximately
86.03% of the outstanding capital stock of PLDT was registered in the names of
Philippine persons.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286177"></a><a name="_Toc75779235"></a><a
name="_Toc46082295"><b>Related Party
Transactions</b></a></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Cooperation Agreement with
First Pacific and certain affiliates, or the FP Parties, NTT Communications and
DoCoMo</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
connection with the transfer by NTT Communications Corporation, or NTT
Communications, of approximately 12.6 million shares of PLDT&#146;s common stock to
NTT DoCoMo, Inc, or DoCoMo, pursuant to a Stock Sale and Purchase Agreement
dated January 31, 2006 between NTT Communications and DoCoMo, the FP Parties,
NTT Communications and DoCoMo entered into a Cooperation Agreement, dated
January 31, 2006.  Under the Cooperation Agreement, the relevant parties
extended certain rights of NTT Communications under the Stock Purchase and
Strategic Investment Agreement dated September 28, 1999, as amended, and the
Shareholders Agreement dated March 24, 2000, to DoCoMo, including:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
certain contractual veto rights
over a number of major decisions or transactions, as set forth above under Item
3. &#147;Key Information &#150;&#150; Risk Factors &#150;&#150; Risks Relating to Us &#150;&#150; A significant
number of PLDT&#146;s shares are held by three separate shareholders, which may not
act in the interests of other shareholders or stakeholders in PLDT&#148;; and</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
rights relating to the
representation on the board of directors of PLDT and Smart, respectively, and
any committees thereof, as described above under Item 6. &#147;Directors, Senior
Management and Employees &#150;&#150; Directors, Key Officers and Advisors&#148;.</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Moreover, key provisions of the
Cooperation Agreement pertain to, among other things:</p>

<p style='margin-left:.75in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Restriction on Ownership of
Shares of PLDT by NTT Communications and DoCoMo. </i> Each of NTT Communications and DoCoMo has agreed not
to beneficially own, directly or indirectly, in the aggregate with their
respective subsidiaries and affiliates, more than 21% of then issued and
outstanding shares of PLDT&#146;s common stock.  If such event does occur, the FP
Parties, as long as they own in the aggregate not less than 21% of then issued
and outstanding shares of PLDT&#146;s common stock, have the right to terminate
their respective rights and obligations under the Cooperation Agreement, the
Shareholders Agreement and the Stock
Purchase and Strategic Investment Agreement.</p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Limitation on Competition.</i>  NTT Communications, DoCoMo and their respective
subsidiaries are prohibited from investing in excess of certain thresholds in
businesses competing with PLDT in respect of customers principally located in
the Philippines and from using their assets in the Philippines in such
businesses.  Moreover, if PLDT, Smart or any of Smart&#146;s subsidiaries
intends to enter into any contractual arrangement relating to certain competing
businesses, PLDT is required to provide, or to use reasonable efforts to
procure that Smart or any of Smart&#146;s subsidiaries provide, NTT Communications
and DoCoMo with the same opportunity to enter into such agreement with PLDT or
Smart or Smart&#146;s subsidiaries, as the case may be.  </p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Business Cooperation.</i>  PLDT and DoCoMo agreed in principle to collaborate
with each other on the business development, roll-out and use of a W-CDMA
mobile communication network.  In addition, PLDT agreed, to the extent of the
power conferred by its direct or indirect shareholding in Smart, to procure that Smart will (i) become a
member of a strategic alliance group for international roaming and corporate
sales and services and (ii) enter into a business relationship concerning
preferred roaming and inter-operator tariff discounts with DoCoMo.  </p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Additional Rights of DoCoMo. </i> Upon NTT Communications, DoCoMo and their
subsidiaries owning in the aggregate 20% or more of the shares of PLDT&#146;s common
stock and for as long as NTT Communications, DoCoMo and their subsidiaries
continue to own in the aggregate 17.5% of the shares of PLDT&#146;s common stock
then outstanding, DoCoMo will be entitled to certain additional rights under
the Cooperation Agreement.</p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Change in Control.</i>  Each of NTT
Communications, DoCoMo and the FP Parties agreed that to the extent permissible
under applicable laws and regulations of the Philippines and other
jurisdictions, subject to certain conditions, to cast its vote as a shareholder
in support of any resolution proposed by the board of directors of PLDT for the
purpose of safeguarding PLDT from any Hostile Transferee.  A &#147;Hostile
Transferee&#148; is defined under the Cooperation Agreement to mean any person
(other than NTT Communications, DoCoMo, First Pacific or any of their
respective affiliates) determined to be so by the PLDT board of directors and
includes, without limitation, a person who announces an intention to acquire,
seeking to acquire or acquires 30% or more of PLDT common shares then issued
and outstanding from time-to-time or having (by itself or together with itself)
acquired 30% or more of the PLDT common shares announces an intention to acquire,
seeking to acquire or acquires a further 2% of such PLDT common shares (a) at a
price per share which is less than the fair market value as determined by the
board of directors of PLDT as advised by a professional financial advisor, (b)
which is subject to conditions which are subjective or which could not
reasonably be satisfied, (c) without making an offer for all PLDT common shares
not held by it and/or its affiliates and/or persons who, pursuant to an
agreement or understanding (whether formal or informal), actively cooperate to
obtain or consolidate control over PLDT, (d) whose offer for the PLDT common
shares is unlikely to succeed or (e) whose intention is otherwise not bona
fide; provided that, no person will be deemed a Hostile Transferee unless prior
to making such determination, the board of directors of PLDT has used
reasonable efforts to discuss with NTT Communications and DoCoMo in good faith
whether such person should be considered a Hostile Transferee.  For information as to certain provisions of PLDT&#146;s
Amended By-Laws that may have the effect
of preventing a change in control of PLDT, see Item 10. &#147;Additional Information
&#150;&#150; Articles of Incorporations and By-Laws
&#150;&#150; Change in Control&#148;.</p>

<p style='margin-left:.75in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Termination.</i>  If NTT Communications, DoCoMo or their respective
subsidiaries cease to own, in the aggregate, full legal and beneficial title to
at least 10% of the shares of PLDT&#146;s common stock then issued and outstanding,
their respective rights and obligations under the Cooperation Agreement and the
Shareholders Agreement will terminate and the Strategic Arrangements (as
defined in the Stock Purchase and Strategic Investment Agreement) will
terminate.  If the FP Parties and their respective subsidiaries cease to have,
directly or indirectly, effective voting power in respect of shares of PLDT&#146;s
common stock representing at least 18.5% of the shares of PLDT&#146;s common stock
then issued and outstanding, their respective rights and obligations under the
Cooperation Agreement, the Stock Purchase and Strategic Investment Agreement,
and the Shareholders Agreement will terminate.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Integrated i-mode Services
Package Agreement between DoCoMo and Smart</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">An
Integrated i-mode Services Package Agreement was entered into by Smart and
DoCoMo on February 15, 2006, under which DoCoMo agreed to grant Smart, on an
exclusive basis within the territory of the Philippines for a period of five
years, an integrated i-mode services package including a non-transferable
license to use the licensed materials and the i-mode brand, as well as
implementation support and assistance and post-commercial launch support from
DoCoMo.  Pursuant to this agreement, Smart is required to pay an initial
license fee and running royalty fees based on the revenue arising from i-mode
subscription fees and data traffic.  The initial license fee paid as at
December 31, 2006 amounted to Php53 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Advisory Services Agreement between DoCoMo and PLDT</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">An Advisory Services Agreement was entered into by
DoCoMo and PLDT on June 5, 2006, in accordance with the Cooperation Agreement.
Pursuant to the Agreement, DoCoMo will provide the services of certain key
personnel in connection with certain aspects of the business of PLDT and
Smart.  Also, the agreement governs the terms and conditions of the
appointments and the corresponding fees related thereto.  The initial license
fee paid as at December 31, 2006 amounted to Php12 million.  Outstanding
liability under this agreement amounted to Php32 million as at December 31,
2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Other Agreements with NTT
Communications and/or its Affiliates</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
is a party to the following agreements with NTT Communications and/or its
affiliates:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Advisory
Services Agreement.   </i>On March 24,
2000, PLDT entered into an agreement with NTT Communications, as amended on
March 31, 2003, March 31, 2005 and June 16, 2006, under which NTT
Communications provides PLDT with technical, marketing and other consulting
services for various business areas of PLDT starting April 1, 2000;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Arcstar
Licensing Agreement and Arcstar Service Provider Agreement.   </i>On March 24, 2000, PLDT entered into an agreement with
NTT Worldwide Telecommunications Corporation under which PLDT markets managed
data and other services under NTT Communications&#146; &#147;Arcstar&#148; brand to its
corporate customers in the Philippines.  PLDT also entered into a Trade Name
and Trademark Agreement with NTT Communications under which PLDT has been given
the right to use the tradename &#147;Arcstar&#148; and its related trademark, logo and
symbols, solely for the purpose of PLDT&#146;s marketing, promotional and sales
activities for the Arcstar services within the Philippines; and</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Conventional
International Telecommunications Services Agreement.</i>  On March 24, 2000, PLDT entered into an agreement with NTT
Communications under which PLDT and NTT Communications agreed to cooperative
arrangements for conventional international telecommunications services to
enhance their respective international businesses.  </p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Total fees under these agreements
amounted to Php184 million, Php256 million and Php336 million for the years
ended December 31, 2006, 2005 and 2004, respectively.  As at December 31, 2006
and 2005, outstanding obligations of PLDT amounted to Php18 million and Php23
million, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Air Time Purchase Agreement between PLDT and AIL and Related Agreements
</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">See Item 5. &#147;Operating and Financial Review and Prospects
&#151; Liquidity and Capital Resources &#151; Contractual Obligations and Commercial
Commitments &#151; Contractual Obligations &#151; Unconditional Purchase Obligations &#151;
Air Time Purchase Agreement with AIL&#148; above and <i>Note 16 &#150; Related Party
Transactions </i>to the consolidated financial statements in Item 18 for a
discussion of the ATPA and PLDT&#146;s obligations thereunder.</p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Agreement
between Smart and Asia Link B.V</i>.<i>,
or ALBV </i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart
has an existing Technical Assistance Agreement with ALBV, a subsidiary of the
First Pacific Group, for ALBV to provide technical support services and
assistance in the operations and maintenance of cellular business for a period
of five years, subject to renewal upon mutual agreement between the parties.
The agreement provides for quarterly payments of technical service fees
equivalent to 2% of the net revenues of Smart.  In January 2004, the agreement
was amended, reducing the technical service fees to be paid by Smart to ALBV to
1% of net revenues effective January 1, 2004.  On February 18, 2004, Smart and
ALBV entered into a renewal of the Technical Assistance Agreement extending the
effectivity of the terms thereof to February 23, 2008.  Furthermore, in view of
the acquisition by Smart of Piltel Series K Class I Convertible Preferred Stock
held by PLDT, the parties agreed to make the consolidated net revenues of Smart
the basis for the computation of the 1% technical service fees payable by Smart
to ALBV, effective January 1, 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart
also has an existing Services Agreement with ALBV for a period of 25 years
starting January 1, 1999, which shall automatically expire unless renewed by
mutual agreement of both parties.  Under the agreement, ALBV provides advice
and assistance to Smart in sourcing capital equipment and negotiating with
international suppliers, arranging international financing and other services
therein consistent with and for the furtherance of the objectives of the
services.  Service agreement fees were paid for the whole 25-year period.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">Total fees under these agreements amounted
to Php591 million, Php567 and Php507 million for the years ended December 31,
2006, 2005 and 2004, respectively.  Outstanding obligations of Smart under
these agreements amounted to Php128 million and Php194 million as at December
31, 2006 and 2005, respectively.  Outstanding prepaid management fees as at
December 31, 2006 and 2005 amounted to Php869 million and Php920 million,
respectively.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:0in' style="margin-top:0;margin-bottom:0"><i>Agreements relating to insurance companies</i></p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:
..5in' style="margin-top:0;margin-bottom:0">Gotuaco del Rosario and Associates, or
Gotuaco, acts as the broker for certain insurance companies to cover certain
insurable properties of the PLDT Group.  Insurance premiums are remitted to
Gotuaco and the broker&#146;s fees are settled between Gotuaco and the insurance companies.
In addition, PLDT has an insurance policy with Malayan Insurance Co., Inc., or
Malayan, wherein premiums are paid directly to Malayan.  Total insurance
expenses paid under these agreements amounted to Php360 million, Php468 million
and Php534 million for the years ended December 31, 2006, 2005 and 2004,
respectively.  Two directors of PLDT have a direct/indirect interest in or
serve as a director/officer of Gotuaco and Malayan.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">There have been no loans between PLDT and any related party during the
period beginning January 1, 2004 through the date of filing of this annual
report.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Except for the transactions described above, there were no other
material transactions during the last two years, nor are there any material
transactions currently proposed, to which PLDT was or is to be a party, in
which a director or key officer or owner of more than 10% of the common shares
of PLDT, or any member of the immediate family of a director or key officer or
owner of more than 10% of the common shares of PLDT had or is to have a direct
or indirect material interest.  In the ordinary course of business, PLDT has
transactions with other companies in which some of such persons may have an
interest.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">No
director or officer of PLDT or associate of any such director or officer was
indebted to PLDT at any time during the period from January 1, 2004 through the date of filing of this annual report.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286178"></a><a name="_Toc75779236"></a><a
name="_Toc46082296"><b>Item 8.       Financial
Information</b></a></p>

<p style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286179"></a><a name="_Toc75779237"></a><a
name="_Toc46082297"><b>Consolidated Statements
and Other Financial Information</b></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Consolidated
financial statements are set forth under Item 18. &#147;Financial Statements.&#148;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286180"></a><a name="_Toc75779238"></a><a
name="_Toc46082298"><b>Legal Proceedings</b></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Except
as disclosed in the following paragraphs, neither PLDT nor any of its
subsidiaries is a party to, and none of their respective properties is subject
to, any pending legal proceedings that PLDT considers to be potentially
material to its and its subsidiaries&#146; business.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc164499767"><i>Quo
Warranto Action</i></a></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">On
June 4, 1990, the Solicitor General of the Philippines instituted legal
proceedings in the Regional Trial Court of Makati City seeking to &#147;oust
Philippine Long Distance Telephone Company (PLDT) from exercising its franchise
and/or to revoke, cancel and/or pre-terminate its franchise (Act No. 3436, as
amended) and/or to break up an alleged unlawful monopoly and give equal and
fair opportunity to other service corporations.&#148;  The Solicitor General cited
constitutional and statutory grounds for his action, including alleged foreign
investors&#146; participation in the control and management of PLDT on a basis
disproportionate to their holdings of PLDT&#146;s capital stock, violation of the
requirement that 60% of the capital of a public utility be owned by Philippine
citizens, inadequate and costly equipment and service, and blocking of the
right of other parties to provide telephone service in the Philippines.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
believe that these allegations are without merit and plan to defend ourselves
vigorously.  The Philippine Congress granted PLDT&#146;s amended franchise under
Republic Act No. 7082 notwithstanding the existence of these proceedings and
the opposition of the Solicitor General.  The case has been archived by virtue
of a court order dated January 20, 1999.  No further action has been taken and
the case remains inactive.  </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:auto' style="margin-top:0;margin-bottom:0">Taxation</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>National Internal Revenue Taxes</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT has filed various cases against the Commissioner
of the Bureau of Internal Revenue, or BIR, for refunds and/or tax credit of:</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:5.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
erroneously paid VAT, compensating taxes, advance sales taxes and
other internal revenue taxes on PLDT's importation of various equipment,
machinery and spare parts; and</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:5.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;
margin-bottom:0in;margin-left:.75in;margin-bottom:.0001pt;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
erroneously paid withholding tax on separation pay of employees
who availed of the benefits under the Manpower Reduction Program. </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:5.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
the case of the claim for refund of erroneously paid VAT, compensating taxes,
advance sales taxes and other internal revenue taxes on PLDT&#146;s importation of
various equipment, machinery and spare parts, the Supreme Court, on December
15, 2005, rendered a decision partially granting the claim for refund or tax
credit certificates and ordering the Commissioner of the BIR to issue a Tax
Credit Certificate or to refund to PLDT approximately Php95 million
representing erroneously collected advance sales tax and compensating tax.
PLDT filed a motion for execution that was opposed by the BIR and is currently
still pending with the Court of Tax Appeals.  The Court of Tax Appeals has
issued a Resolution on May 18, 2007, ordering the issuance of the corresponding
Writ of Execution.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
case of the claim for refund of erroneously paid withholding tax on separation
pay is still pending with the Supreme Court.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>NTC supervision and regulation fees, or SRF</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
line-height:5.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:40.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Since 1994, following the NTC's rejection of PLDT's
formal protest against the assessments by the NTC of permit, supervision and
regulation fees, PLDT and the NTC have been involved in legal proceedings
before the Court of Appeals and the Supreme Court.  The basis of these legal
proceedings is the NTC's inclusion of stock dividends and capital in excess of
the par value of stock in computing these fees, and the NTC's assessment of
administrative fees for the increase in PLDT's authorized capital stock even in
the absence of NTC's performance of regulatory services.  As at December 31,
2006, since 1994, PLDT has paid a total amount of Php2,219 million in
supervision and regulation fees, of which Php1,956 million were paid under
protest.  </p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Local
business and franchise tax assesments</i></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT is presently a party to several cases involving
the issue of exemption of PLDT from local franchise and business taxes.  PLDT
believes, based on the opinion of its legal counsel, that it is exempt from
payment of local franchise and business taxes. </p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The Local Government Code of 1991, or
Republic Act (R.A.) 7160, which took effect on January 1, 1992, extended to
local government units, or LGUs, the power to tax businesses within their
territorial jurisdiction granted under Batas Pambansa 337, and withdrew tax
exemptions previously granted to franchise grantees under Section 12 of R.A.
7082. </p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT believes, based on the opinion of its legal
counsel, that R.A. 7925, which took effect on March 16, 1995, and the grant of
local franchise and business taxes exemption privileges to other franchise
holders subsequent to the effectivity of R.A. 7160, implicitly restored its
local franchise and business taxes exemption privilege under Section 12 of R.A.
7082, or the PLDT Franchise pursuant to Section 23 thereof or the equality of
treatment clause. </p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">To
confirm this position, PLDT sought and obtained on June 2, 1998 a ruling from
the Bureau of Local Government Finance, or BLGF, of the Philippine Department
of Finance, which ruled that PLDT is exempt from the payment of local franchise
and business taxes imposable by LGUs under R.A. 7160.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;line-height:
94%' style="margin-top:0;margin-bottom:0">By virtue of the BLGF
Ruling, PLDT stopped paying local franchise and business taxes starting with
the fourth quarter of 1998 and has filed with certain LGUs claims for tax
refund covering the period from the second quarter of 1995 to the third quarter
of 1998.  PLDT has received assessments for local franchise and business taxes from
several cities and provinces following PLDT&#146;s decision to stop payment of local
franchise and business taxes.  </p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Following a decision of the Supreme Court on March 25,
2003, a judgment in the amount of Php4 million against PLDT involving the City
of Davao became final and executory on April 9, 2003, pursuant to which PLDT
was declared not exempt from the local franchise tax.  Pursuant to said
decision, PLDT has voluntarily paid the total amount of Php15 million for the
period from the fourth quarter of 1998 until December 31, 2003, which includes
the Php4 million subject of the case.  </p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT
had no longer contested assessments of LGUs for franchise taxes as at December
31, 2006.  However, PLDT continues to contest the validity of the assessment of
penalties and surcharges of Php1.3 million and Php2.3 million, by the City of
Ozamiz and the Province of Bulacan, respectively, for the years 1998 to 2002
when PLDT refrained from payment of local franchise taxes upon its reliance in
good faith on the BLGF Ruling that it is exempt from local franchise tax.  PLDT
is also contesting the validity of the assessment of local franchise tax of
Php2.8 million by the Province of Cagayan on the gross receipts received or
collected by PLDT in Tuguegarao City wherein franchise tax was already paid to
the latter.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT
likewise continues to contest the imposition of local business taxes in
addition to local franchise tax by the Cities of Tuguegarao, Balanga and
Caloocan in the amounts of Php1.9 million, Php0.2 million and Php6.3 million,
respectively, for the years 1998 to 2003 for the City of Tuguegarao, and for
the years 2005 to 2007 for the Cities of Balanga and Caloocan.  PLDT is
likewise contesting the imposition of a business tax on the transmission of
messages by the Municipality of San Pedro in the amount of Php0.3 million for
the years 2005 to 2007.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
currently expects that going forward it will pay local franchise and business taxes
on an annual basis and based on the gross receipts received or collected for
services rendered within the jurisdiction of the respective taxing authority.  </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart has paid local business and franchise taxes to
certain cities and provinces in the aggregate amount of Php313 million under
protest.  Smart&#146;s legal position is that it is not liable to pay the local
franchise tax by virtue of its Smart&#146;s exemption under legislative franchise
under R.A. 7294, which took effect after the effective date of the Local
Government Code of 1991, or R.A. 7160.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The Regional Trial Court, or RTC, of Makati has declared Smart exempt from payment of local franchise tax to the City of Makati in a decision rendered in the case entitled <i>Smart Communications, Inc. vs. City
of Makati </i>(Civil Cases No. 02-249 &amp; 02-725, August 3, 2004).  The City
of Makati has filed a Motion for Extension to file a Petition for Review with
the Court of Appeals.  However, on June 9, 2005, the Court of Appeals dismissed
the appeal filed by the City of Makati.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">The RTC of Iloilo has likewise ruled in a decision
dated January 19, 2005 that Smart is exempt from payment of local franchise tax
to the City of Iloilo.  The City of Iloilo has filed an appeal directly with
the Supreme Court, which remains pending.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Piltel&#146;s Bureau of Internal Revenue Assessment</i></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Piltel has received the following
assessment notices from the BIR:</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:96.86%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Tax Assessment Type</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Basic</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:24.75pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Interest</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:9.05pt;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">1998</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">VAT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">85.8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:24.75pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">68.7</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:.15in;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 154.5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Overseas Communications Tax, or OCT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">31.8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:24.75pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">25.5</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:9.05pt;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">  57.3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Income Tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">12.4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 text-indent:24.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">9.4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:9.05pt;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">  21.8</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Administrative Penalties</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:33.1pt;text-align:right;
 text-indent:27.35pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">0.1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 text-indent:24.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.3pt;text-align:right;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">   0.1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:24.75pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:9.05pt;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">1999</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">VAT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">94.5</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:24.75pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">67.8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:.15in;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 162.3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Income Tax</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">22.7</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:24.75pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">13.8</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:9.05pt;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">  36.5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:24.75pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:9.05pt;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">2001</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">VAT</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">56.2</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:24.75pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">35.1</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:9.05pt;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">  91.3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;text-indent:8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-right:.05in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Income Tax</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-right:4.3pt;text-indent:27.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">13.4</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.7pt;text-align:right;
 text-indent:24.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.9</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:9.05pt;text-align:center;
 text-indent:12.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">  22.3</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">On December 12, 2005, Piltel filed a
collective application for a compromise settlement with the BIR for the
deficiency tax assessments arising from taxable years 1998, 1999 and 2001,
citing &#147;reasonable doubt as to the validity of the tax assessments&#148; as a
basis.  The prescribed minimum percentage of the compromise settlement for such
basis is 40% of the basic assessed tax.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">On January 27, 2006, Piltel received the
favorable recommendation and approval from the BIR on the said application for
a compromise settlement.  On January 31, 2006, Piltel settled the total amount
of Php114 million, which is equivalent to 40% of the basic taxes per final
assessment notices received, to effect the immediate cancellation of the tax
assessments.  On February 24, 2006, the BIR accepted Piltel&#146;s application for a
compromise settlement of income taxes and VAT for the years 1998, 1999 and
2001, and issued the Certificate of Availment on the said date.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286181"></a><a name="_Toc75779239"></a><a
name="_DV_M2"></a><a name="_DV_M3"></a><a name="_DV_M4"></a><a name="_DV_M5"></a><a
name="_DV_M6"></a><a name="_DV_M7"></a><a name="_DV_M8"></a><a name="_DV_M9"></a><a
name="_DV_M10"></a><a name="_DV_M11"></a><a name="_DV_M12"></a><a name="_DV_M13"></a><a
name="_DV_M14"></a><a name="_DV_M15"></a><a name="_DV_M16"></a><b>Dividend Distribution Policy</b></p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
2006 and 2005, PLDT declared cash dividends of Php588 million and Php1,627
million, respectively, solely for its preferred shareholders.  In addition, on
March 1, 2005, PLDT declared a cash dividend at Php14 per common share to
holders of record as at March 31, 2005, which was paid on May 12, 2005,
constituting the first cash dividend declaration to common shareholders since
March 2001.  This was followed by cash dividend declarations made by PLDT on
its common stock on May 5, 2005, at Php21 per common share to holders of record
as at June 3, 2005, which was paid on July 14, 2005; on November 8, 2005, at
Php21 per common share to holders of record as at November 28, 2005, which was
paid on December 28, 2005; on February 27, 2006, at Php28 per common share to
holders of record as at March 20, 2006, which was paid on April 20, 2006; and
on August 8, 2006, at Php50 per common share to holders of record as at August
21, 2006, which was paid on September 21, 2006. .</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
current policy is to declare and pay dividends taking into consideration the
interests of our shareholders as well as our working capital, capital
expenditures and debt servicing requirements.  Also taken into consideration
are our ability to meet loan covenant requirements and the required prior
written consents of certain creditors and preferred stockholders (for stock
dividends), under certain conditions, in the declaration and payment of
dividends as discussed in <i>Note 12 &#150; Interest-bearing Financial Liabilities </i>and
<i>Note</i> <i>15 &#150; Stockholders&#146; Equity</i> to the accompanying consolidated
financial statements in Item 18.  The retention of earnings is necessary to
meet the funding requirements of our business expansion and development
programs.  Unappropriated retained earnings of PLDT include undistributed
earnings representing accumulated equity in the net earnings of our
subsidiaries, which are not available for distribution as dividends until
received in the form of dividends from such subsidiaries (see <i>Note 15 &#150; Stockholders&#146;
Equity</i> to the accompanying consolidated financial statements in Item 18).
Dividends are generally paid in Philippine pesos.  In the case of shareholders
residing outside the Philippines, PLDT's transfer agent in Manila, which acts
as the dividend-disbursing agent, converts the peso dividends into U.S. dollars
at the prevailing exchange rates and remits the dollar proceeds abroad, net of
withholding tax.</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286182"></a><a name="_Toc75779240"></a><a
name="_Toc46082300"><b>Item 9.       The Offer
and Listing</b></a></p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK5"></a><a name="OLE_LINK4"></a><a
name="_Toc170286183"></a><a name="_Toc75779241"></a><a name="_Toc46082301"><b>Common Capital Stock and American Depositary Shares (&#147;ADSs&#148;)</b></a></p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
common shares of PLDT are listed and traded on the PSE.  On October 19, 1994, an ADR facility was established, pursuant to which Citibank, N.A., as
the depositary, issued ADRs evidencing ADSs, with each ADS representing one
PLDT common share with a par value of Php5 per share.  Effective February 10, 2003, PLDT appointed JP Morgan Chase Bank as successor depositary of PLDT&#146;s
ADR facility.  The facility was established in accordance with a Common Stock
Deposit Agreement dated October 19, 1994, as amended on February 10, 2003 between the Depositary and the holders of the ADRs.  The ADSs have been listed and
are traded on the New York Stock Exchange, or NYSE, in the United States under the symbol &#147;PHI&#148;.  </p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Until recently, the ADSs were
also listed on the NYSE Arca.  However, on December 18, 2006, PLDT issued a
notice of its intent to voluntarily delist its ADSs from NYSE Arca, after determining
that doing so is in the best interest of PLDT and its stockholders as it would
eliminate the duplicative administrative burdens and costs inherent in dual
listing on both the NYSE and NYSE Arca.  The actual delisting from the NYSE
Arca became effective on February 12, 2007.</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In 2006, a total of 39.6 million shares of PLDT's common capital stock
were traded on the PSE.  During the same year, the volume of trading was 69.7
million ADSs on the NYSE.</p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As at May 31, 2007, approximately 11,105 stockholders were Philippine
persons and held approximately 35% of the shares of PLDT&#146;s common stock and
approximately 86.03% of the outstanding capital stock of PLDT.  In addition, as
at May 31, 2007, there was a total of over 40 million ADSs outstanding,
substantially all of which PLDT believes were held in the United States by 379 holders.</p>

<p style='text-indent:0in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">High and low sales prices for PLDT&#146;s common shares on
the PSE and ADSs on the NYSE for each of the five most recent fiscal years,
each full quarterly period during the two most recent fiscal years, and each
month in the most recent six months were as follows: </p>

<p style='text-indent:0in;line-height:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.45in;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>PSE</b></p>
 </td>
 <td  valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>NYSE</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>High</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Low</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>High</b></p>
 </td>
 <td  valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Low</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-right:.7pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Second Quarter (through June 26, 2007)</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,730.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php2,390.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$58.88</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$50.05</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">April </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,585.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,390.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">54.89</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">50.05</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">May</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,585.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,470.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.66</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">53.00</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">June (through June 26, 2007)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,730.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,525.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">58.88</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">54.88</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">First Quarter</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,820.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,250.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.62</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">45.25</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">January </p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,820.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,385.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">56.62</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">48.20</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">February</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,675.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,285.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">54.10</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">45.25</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">March</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,555.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,250.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">53.40</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">46.30</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,610.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,675.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">51.90</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">32.15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">First Quarter</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,930.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,675.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">38.09</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">32.20</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Second Quarter </p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,295.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,700.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">43.99</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">32.15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Third Quarter</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,300.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,790.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">45.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">34.57</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Fourth Quarter</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,610.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,150.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">51.90</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">42.56</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">December</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,570.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,325.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">51.50</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">47.08</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:.25in;margin-bottom:.0001pt;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,860.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,310.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">34.35</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">23.50</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">First Quarter</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,495.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,310.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">27.75</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">23.50</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Second Quarter</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,645.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,330.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">30.07</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">24.10</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Third Quarter</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,715.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,520.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">30.59</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">27.28</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:13.5pt;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fourth Quarter</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,860.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,630.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">34.35</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">28.88</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,505.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">810.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">27.03</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">14.38</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">2003</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">990.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">265.00</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">17.79</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4.85</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">2002</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">565.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">209.00</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">11.30</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">3.85</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286184"></a><a name="_Toc75779243"></a><a
name="_Toc46082303"><b>Item 10.    Additional
Information</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286185"></a><a name="_Toc75779244"></a><a
name="_Toc46082304"><b>Articles of Incorporation
and By-Laws</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following summarizes certain provisions of PLDT's Articles of Incorporation and
By-Laws and applicable Philippine law.  This summary is qualified in its
entirety by reference to the Corporation Code of the Philippines (the
&#147;Corporation Code&#148;) and PLDT&#146;s Articles of Incorporation and By-Laws.
Information on where investors can obtain copies of the Articles of Association
and By-Laws is described under the heading &#147;Documents Available.&#148;</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Purpose of PLDT</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT's
Articles of Incorporation have been filed with the Philippine SEC and PLDT has
been issued Philippine SEC Reg. No. 55.  The Second Article of PLDT's Articles
of Incorporation provides that the purposes for which PLDT was formed are to
install, maintain, and operate any and all kinds of equipment for
communications; to install, maintain, operate or lease telephone lines and
systems, and to purchase, sell and deal in all kinds of products which may be
combined with the building, installing and operation of those systems and lines
and in general, to engage in any and all acts and business which may be necessary
or convenient, in the furtherance of such lines of communication and business.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Directors</i></p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT's
Amended By-Laws provide that the Board of Directors shall consist of thirteen
members, each of whom must hold at least one share of stock of PLDT in his own
name and possess the minimum qualifications and have none of the
disqualifications provided in the By-Laws.  There are no provisions in PLDT&#146;s
Amended Articles of Incorporation or Amended By-Laws with respect to (a) a
director&#146;s power to vote on a proposal, arrangement or contract in which the
director is materially interested, (b) the directors&#146; power, in the absence of
an independent quorum, to vote compensation to themselves or any members of
their body, (c) borrowing powers exercisable by the directors and how such
borrowing powers can be varied, or (d) retirement or non-retirement of
directors under an age limit requirement.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Description
of PLDT Capital Stock</p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Authorized Capital Stock</i></p>

<p style='line-height:10.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
authorized capital stock of PLDT is Php9,395 million divided into two classes
consisting of 234 million shares of Common Capital Stock with a par value of
Php5 per share (the &#147;Common Stock&#148;) and 822.5 million shares of serial
Preferred Stock with a par value of Php10 per share (the &#147;Preferred Stock&#148;).</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Common Stock</i></p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Set
out below is a statement of the dividend, voting, pre-emption and other rights
of the holders of Common Stock as set out in the Articles of Incorporation
and/or By-Laws of PLDT:</p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(a)&nbsp;&nbsp;&nbsp;&nbsp;
After the requirements with
respect to preferential dividends on the serial Preferred Stock shall have been
met and after PLDT shall have complied with all the requirements, if any, with
respect to the setting aside of sums as purchase, retirement or sinking funds,
the holders of the Common Stock shall be entitled to receive such dividends as
may be declared from time to time by the Board of Directors out of funds
legally available therefor.</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(b)&nbsp;&nbsp;&nbsp;&nbsp;
After distribution in full of the
preferential amounts to be distributed to the holders of serial Preferred Stock
in the event of the voluntary or involuntary liquidation, dissolution,
distribution of assets or winding up of PLDT, the holders of Common Stock shall
be entitled to receive all the remaining assets of PLDT of whatever kind
available for distribution to stockholders ratably in proportion to the number
of Common Stock held by them, respectively.</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(c)&nbsp;&nbsp;&nbsp;&nbsp;
Except as may be otherwise
required by law, or by the Articles of Incorporation of PLDT, each holder of
Common Stock shall have one vote in respect of each share of such stock held by
him on all matters to be voted upon by the stockholders, and the holders of
Common Stock shall have the exclusive right to vote for the election of
directors and for all other purposes.  At every election of directors, a holder
of Common Stock is entitled to vote such shares of Common Stock held by him for
as many persons as there are directors to be elected, or to cumulate said
shares and give one candidate as many votes as the number of directors to be
elected multiplied by the number of his shares shall equal, or to distribute
such votes on the same principle among as many candidates as he shall think
fit.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">In addition to the foregoing
rights, the Corporation Code provides for other stockholders&#146; rights generally,
which include:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(a)&nbsp;&nbsp;&nbsp;&nbsp;
Appraisal right or the right of a
dissenting stockholder to demand payment of the fair value of his shares of
stock in the following instances:  (a) in case any amendment to the articles of
incorporation has the effect of changing or restricting the rights of any
stockholders or class of shares, or of authorizing preferences in any respect
superior to those of outstanding shares of any class, or of extending or
shortening the term of corporate existence; (b) in case of sale, lease,
exchange, transfer, mortgage, pledge or other disposition of all or
substantially all of the corporate property and assets of the corporation; (c)
in case of merger or consolidation; and (d) in case of investment of funds of
the corporation in any other corporation or business or for any purpose other
than the primary purpose for which it was organized, except where the
investment by the corporation is reasonably necessary to accomplish its primary
purpose as stated in its articles of incorporation.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(b)&nbsp;&nbsp;&nbsp;&nbsp;
The right to approve certain
corporate acts, such as (a) election of directors; (b) removal of directors; <br>
(c) extension or shortening of the corporate term; (d) increase or decrease of
capital stock, and incurring, creating or increasing bonded indebtedness; (e)
sale or other disposition of all or substantially all of the corporate assets;
(f) investment of corporate funds in any other corporation or business or for
any purpose other than the primary purpose for which it was organized except
where the investment is reasonably necessary to accomplish its primary purpose
as stated in the corporation&#146;s articles of incorporation; (g) declaration of
stock dividend; (h) entering into a management contract with another
corporation; (i) plan of merger or consolidation; and (j) voluntary dissolution
of the corporation by shortening the corporate term.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(c)&nbsp;&nbsp;&nbsp;&nbsp;
The right to inspect at reasonable
hours on business days the records of all business transactions of the
corporation and the minutes of any meeting; however, the stockholders&#146; right to
inspect corporate records and books is not an absolute right so that the
corporation may deny said right on the basis of impropriety of the purpose or
motive of the stockholder.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(d)&nbsp;&nbsp;&nbsp;&nbsp;
The right to be furnished the most
recent financial statements of the corporation, within ten (10) days from
receipt by the corporation of a written request from a stockholder.  The same
right exists at the annual meeting of stockholders at which the Board of
Directors must present to the stockholders a financial report of the operations
of the corporation for the preceding year which shall include financial
statements duly signed and certified by an independent certified public
accountant.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Restrictions
on Foreign Ownership</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
Constitution of the Republic of the Philippines (Section 11, Article XII)
states that no franchise, certificate, or any other form of authorization for
the operation of a public utility shall be granted except to citizens of the
Philippines or to corporations or associations organized under the laws of the
Philippines at least 60% of whose capital is owned by such citizens.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">While
the Articles of Incorporation and By-Laws of PLDT do not contain any specific
restriction on the sale, assignment or transfer of shares that would violate
the aforecited ownership requirement, the Articles of Incorporation of PLDT
provide that the Board of Directors shall have full power and authority to
authorize (whether by adoption of amendments to the By-Laws of PLDT or of
resolutions, the promulgation of rules or regulations or otherwise) the taking
by said corporation of all such actions as the Board of Directors may deem
necessary or appropriate to ensure compliance by said corporation with any
applicable provision of the Constitution of the Republic of the Philippines or
any other applicable law, treaty, rule or regulation relating to the ownership
of securities of said corporation by citizens of the Philippines, aliens or
other persons or group of persons.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Meetings</i></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
Corporation Code requires corporations to hold an annual meeting of
stockholders and to send notice thereof to stockholders.  Under PLDT&#146;s By-Laws,
the annual meeting of stockholders shall be held at the principal office of the
corporation, or at such other place designated by the Board of Directors in the
city or municipality where the principal office of the corporation is located,
on the second Tuesday in June of each year.  In the annual meeting, the Board
of Directors shall be elected and such other business may be transacted as
shall come before the meeting.  At least fifteen (15) business days written or
printed notice of the date, time and place of holding every annual
stockholders' meeting shall be given by the Secretary or by an Assistant
Secretary by personal delivery or by mail to each stockholder at his or her
last known place of residence or business.  Special meetings of stockholders
may be called at any time by the President or three (3) of the Directors or by
a number of stockholders representing two-thirds (2/3) of the subscribed
capital stock.  Notice in writing of such meeting stating the date, time or
place thereof, shall be given to each stockholder by the Secretary or Assistant
Secretary or, in case of his absence, inability, refusal or neglect to act,
then by the President, Directors or stockholders calling said meeting, by
personal delivery or by mail to each stockholder at his or her last known place
of residence, at least fifteen (15) business days before the date fixed for the
meeting.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
By-Laws of PLDT provide that each share of common stock which has voting rights
on any matter under consideration may be represented at any meeting of
stockholders by the holder thereof or by his attorney duly authorized by proxy
in writing on forms prescribed by the Board of Directors which shall be
furnished to a stockholder upon his request.  Unless otherwise provided in the
proxy, it shall be valid only for the meeting in respect of which such proxy
was issued.  Proxies must be filed with the Secretary, Assistant Secretary or
transfer agent of PLDT at least two (2) days before the day of the meeting.
Any proxy filed with the Secretary, Assistant Secretary or transfer agent of
the corporation may be revoked by the stockholder concerned either in an
instrument in writing duly presented to the Secretary, Assistant Secretary or
transfer agent of the corporation at least two (2) days before the day of the
meeting or by his personal presence at the meeting.  The decision of the
Secretary on the validity of proxies shall be final and binding until and
unless set aside by a court of competent jurisdiction.  As provided in the
Corporation Code, unless otherwise provided in the proxy, it shall be valid
only for the meeting for which it is intended and no proxy shall be valid and
effective for a period longer than five (5) years at any one time.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
By-Laws of PLDT also provide that at any meeting of the stockholders, persons
representing, in person or by proxy, a majority of the shares issued and
outstanding and entitled to vote at said meeting shall constitute a quorum for
the transaction of any business, except as otherwise provided by law, and
except that a lesser number may adjourn the meeting.</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Issues
of Shares</i></p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
Board of Directors of PLDT has the power to authorize the issue and sale of
authorized but unissued shares of Common Stock of said corporation for such
consideration as it shall determine, provided that such consideration shall not
be less than the par value of such shares and, provided further, that such
issue and sale is not otherwise prohibited under applicable laws.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Under
the Securities Regulation Code of the Philippines (R.A. No. 8799), or SRC, no
securities except of a class exempt under the provisions thereof or unless sold
in any transaction exempt under any of the provisions thereof, shall be sold or
offered for sale or distribution to the public unless such securities shall
have been registered and permitted to be sold pursuant to the SRC.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Transfer of Shares</i></p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The shares of Common Stock may be transferred by
delivery of certificate(s) endorsed by the shareholder named in the certificate
or his duly authorized attorney or representative.  No transfer, however, shall
be valid, except as between the parties, until the transfer is recorded in the
stock and transfer books of PLDT maintained by Hongkong and Shanghai Banking
Corporation, the stock transfer agent of PLDT for its Common Stock.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Philippine
law does not require transfers of Common Stock to be effected on the PSE, but
any off-exchange transfers will subject the transferor to a capital gains tax
that may be significantly greater than the stock transfer tax applicable to
transfers effected on the PSE.  All transfers of shares of Common Stock on the
PSE must be effected through a licensed broker in the Philippines.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Share
Certificates</i></p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Certificates
representing fully paid shares of Common Stock are issued in such denominations
as stockholders may request, except that certificates will not be issued for
any fractional part of a share or any undivided interest in any share.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Dividends</i></p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Under the Corporation Code, the Board of Directors may
declare dividends on the Common Stock out of the unrestricted retained earnings
which may be payable in cash, in property or in stock to all stockholders on
the basis of outstanding shares held by them.  The declaration of stock
dividends requires the approval of the stockholders of PLDT representing not
less than two-thirds of the outstanding capital stock of PLDT.  If a stock
dividend would require an increase in the authorized capital stock, Philippine
SEC approval would be required.  Common Stock issued as stock dividends should
be registered with and licensed by the Philippine SEC and listed on the PSE.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The Corporation Code requires a
Philippine corporation with retained earnings in excess of 100% of its paid-in
capital to declare and distribute as dividends the amount of such surplus.
Notwithstanding this general requirement, a Philippine corporation may retain
all or any portion of such surplus in the following cases:  (i) when justified
by definite corporate expansion projects or programs approved by the board of
directors; (ii) when the corporation is prohibited under any loan agreement
with any financial institution or creditor, whether local or foreign, from
declaring dividends without its/his consent, and such consent has not yet been
secured; or (iii) when it can be clearly shown that such retention is necessary
under special circumstances relevant to the corporation, such as when there is
a need for special reserve for probable contingencies.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
has entered into certain loan and credit agreements, which restrict the
declaration and payment of dividends by PLDT.  In particular, under certain loan
agreements, PLDT may not declare or pay dividends on any of its capital stock
without the prior written consent of the lenders (i) if PLDT is in default in
the payment of any amounts due and payable under such loan agreement or after
the occurrence and during the continuance of any other event of default or
potential event of default under such agreements, (ii) if after giving effect
to such action the current ratio would be less than 0.90:1 or (iii) in an
amount greater than PLDT&#146;s net income after taxes during the fiscal year to
which such payment or distribution relates.  On March 1, 2005, PLDT declared a cash dividend at Php14 per common
share to holders of record as at March 31, 2005, which was paid on May 12, 2005, constituting the first cash dividend declaration to common shareholders
since March 2001.  This was followed by cash dividend declarations made by PLDT
on its common stock on May 5, 2005, at Php21 per common share to holders of
record as at June 3, 2005, which was paid on July 14, 2005; on November 8,
2005, at Php21 per common share to holders of record as at November 28, 2005,
which was paid on December 28, 2005; on February 27, 2006, at Php28 per common
share to holders of record as at March 20, 2006, which was paid on April 20,
2006; and on August 8, 2006, at Php50 per
common share to holders of record as at August 21, 2006, which was paid on
September 21, 2006.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Preferred Stock</i></p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Preferred Stock may be issued
from time to time in one or more series as the Board of Directors may
determine.  The Board of Directors is authorized to establish and designate the
title and number of shares of each series and to fix the terms thereof, including
dividend rate, redemption and sinking fund provisions, conversion rights and
the amount to be received upon liquidation, provided that the amounts payable
upon redemption or liquidation may not be more than 110%, nor less than 100%,
of par value, plus in each such case accrued and unpaid dividends.  Except as
otherwise provided by law, the holders of Preferred Stock are not entitled to
vote for the election of directors or for any other purpose; provided, however,
that PLDT may not change the rights of the holders of any series of Preferred
Stock in any manner prejudicial to the holders thereof without the affirmative
vote of the holders of a majority of the shares of such series.  No such
approval is needed to increase the number of shares of Preferred Stock (up to
the number from time to time authorized by the Articles) or to authorize
classes of shares ranking on a parity with the Preferred Stock.</p>

<p style='text-indent:.5in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Issued and Outstanding Preferred Stock</i></p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The series of Preferred Stock and the number of shares
issued and outstanding under each series as at <br>
May 31, 2007 are as follows:<b> </b></p>

<p style='text-indent:.5in;line-height:10.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:95.3%;border-collapse:collapse'>
 <tr style='height:.2in'>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p style='margin-top:6.0pt;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>Series</u></b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt;
 height:.2in'>
 <p align=center style='margin-top:6.0pt;margin-right:0in;
 margin-bottom:6.0pt;margin-left:0in;text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>No. of Shares</u></b></p>
 </td>
 </tr>
 <tr style='height:15.3pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:15.3pt'>
 <p style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
 margin-left:0in;line-height:normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Series A to EE 10% Cumulative
 Convertible</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:15.3pt'>
 <p align=right style='margin-top:6.0pt;margin-right:.5in;
 margin-bottom:6.0pt;margin-left:0in;text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">406,100,137</p>
 </td>
 </tr>
 <tr style='height:.2in'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:.2in'>
 <p style='margin-top:6.0pt;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Series
 IV Cumulative Non-Convertible Redeemable</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:.2in'>
 <p align=right style='margin-top:6.0pt;margin-right:.5in;
 margin-bottom:6.0pt;margin-left:0in;text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">36,000,000</p>
 </td>
 </tr>
 <tr style='height:.2in'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:.2in'>
 <p style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
 margin-left:0in;line-height:normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Series V Cumulative
 Convertible Redeemable</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt;height:.2in'>
 <p align=right style='margin-top:6.0pt;margin-right:.5in;
 margin-bottom:6.0pt;margin-left:0in;text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">43,675</p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:16.2pt'>
 <p style='margin-top:6.0pt;margin-right:0in;margin-bottom:
 6.0pt;margin-left:0in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Series
 VI Cumulative Convertible Redeemable</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt;height:16.2pt'>
 <p align=right style='margin-top:6.0pt;margin-right:.5in;
 margin-bottom:6.0pt;margin-left:0in;text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">743,218</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
Series A to EE 10% Cumulative Convertible Preferred Stock are entitled to
receive cumulative dividends at the rate of 10% per annum; redeemable at the
option of PLDT, at par value plus accrued dividends, five years after the year
of issuance; convertible to shares of Common Stock a year after the year of
share issuance, at a price equivalent to 10% below the average market price of
the Common Stock at the PSE over a period of 30 consecutive trading days before
the conversion date; and entitled to be paid an amount equal to the par value
of the shares plus accrued and unpaid dividends thereon to the date fixed for
such payment in the event of a voluntary or involuntary liquidation,
dissolution, distribution of assets or winding up of the affairs of the
corporation.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
Series IV Cumulative Non-Convertible Redeemable Preferred Stock are entitled to
receive cumulative dividends at the rate of 13.5% per annum based on the
paid-up subscription price.  It is redeemable at the option of PLDT one year at
any time after subscription at an amount equal to the par value of such shares
so redeemed or if such shares are not yet fully paid, the actual amount paid,
plus accrued and unpaid dividends thereon; and in the event of a voluntary or
involuntary liquidation, dissolution or winding up of affairs of PLDT, shall be
entitled to be paid an amount equal to the par value of such shares or if such
shares are not yet fully paid, the actual amount paid, plus an amount equal to
the dividends accrued thereon to the date fixed for payment.  The outstanding
shares of Series IV Cumulative Non-Convertible Redeemable Preferred Stock have
not been fully paid.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Shares
of Series V and VI Convertible Preferred Stock are entitled to receive annual
dividends of Php18.70 per share and US$0.397 per share, respectively.  Each
share of Series V and VI PLDT Convertible Preferred Stock is convertible at any
time at the option of the holder into one share of PLDT Common Stock.  In the
event of any voluntary or involuntary liquidation, dissolution or winding up of
PLDT, the holders of the Series V and VI Convertible Preferred Stock are
entitled to receive out of the assets of PLDT available for distribution to the
shareholders of PLDT, before any distribution of assets is made to holders of
shares of Common Stock or any other shares of stock of PLDT ranking as to such
distribution junior to the Series V and VI Convertible Preferred Stock,
liquidating distributions in the amount of Php11 per share plus accrued and
unpaid dividends.  On the date immediately following the seventh anniversary of
the issue date of the Series V and VI Convertible Preferred Stock, the
remaining outstanding shares under these series will be mandatorily converted
into shares of PLDT Common Stock at a conversion rate of one share of Common
Stock for each share of Series V or VI Convertible Preferred Stock subject to
adjustments in certain events.  Under a put option exercisable for 30 days,
holders of shares of Common Stock received on mandatory conversion will be able
to require PLDT to purchase such shares of Common Stock for Php1,700 per share
and US$36.132 per share, for Series V and VI Convertible Preferred Stock,
respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, 2,675,393 shares of Series V Convertible Preferred Stock,
4,419,916 shares of Series VI Convertible Preferred Stock and all 3,842,000
shares of the then outstanding Series VII Convertible Preferred Stock had been
voluntarily converted to PLDT common shares.  As at December 31, 2006, 46,047
shares of Series V and 875,188 shares of Series VI Convertible Preferred Stocks
remained outstanding.  The aggregate value of the put option based on
outstanding shares as at December 31, 2006 was Php1,629 million which is
puttable on June 4, 2008, if all of the outstanding shares of Series V and VI
Convertible Preferred Stocks were mandatorily converted and all the common
shares were put to PLDT at that time.  The market value of the underlying
shares of common stock was Php2,349 million, based on the market price of PLDT
common shares of Php2,550 per share as at December 31, 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Change in Control</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Article
V, Section 1 of PLDT's Amended By-Laws may have the effect of preventing a
change in control of PLDT.  This section provides that any person who is
engaged in any business that competes with or is antagonistic to that of PLDT
or its subsidiaries is ineligible for nomination or election to the Board of
Directors.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0"><a name="_Toc75779245"></a><a
name="_Toc46082305">&nbsp;</a></p>

<p align=left style='text-align:left;text-indent:.5in;page-break-after:
auto' style="margin-top:0;margin-bottom:0">Under the Cooperation Agreement, each of NTT
Communications, DoCoMo and the FP Parties agreed that to the extent permissible
under applicable laws and regulations of the Philippines and other
jurisdictions, subject to certain conditions, it shall cast its vote as a PLDT
shareholder in support of any resolution proposed by the PLDT board of
directors for the purpose of safeguarding PLDT from any Hostile Transferee. See
Item 7. &#147;Major Shareholders and Related Party Transactions &#151; Related Party
Transactions &#151; Cooperation Agreement with the First
Pacific and certain affiliates, or the FP Parties, NTT Communications and
DoCoMo&#148;.</p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286186"><b>Material
Contracts</b></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
have entered into the following contract within the two years preceding the
date of this annual report which is or may be material:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The Cooperation Agreement, dated January 31, 2006, entered into by and among PLDT, First Pacific, Metro Pacific
Corporation, Metro Asia Link Holdings, Inc., Metro Pacific Resources, Inc.,
Larouge B.V., Metro Pacific Assets Holdings, Inc., NTT Communications and
DoCoMo. </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286187"></a><a name="_Toc75779246"></a><a
name="_Toc46082306"><b>Exchange Controls and
Other Limitations Affecting Securities Holders</b></a></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
Circular No. 1389 dated November 10, 1993, as amended by Circular No. 224 dated
 January 26, 2000, of the BSP, foreign investments in the shares of stock of
Philippine companies listed in the PSE may be registered either with the BSP or
with an investor&#146;s designated custodian bank.  The foreign investments in
listed shares of stock, which are duly registered with the BSP or with a
custodian bank duly designated by the foreign investor, are entitled to full
and immediate capital repatriation and dividend and interest remittance
privileges.  Without the need to obtain prior BSP approval, commercial banks
are authorized to sell and to remit the equivalent foreign exchange (at the
exchange rate prevailing at the time of actual remittance) representing sales
and divestment proceeds or dividends of a duly registered foreign equity
investment upon presentation of a BSP Registration Document (&#147;BSRD&#148;) together
with other supporting documents.  The BSRD is issued by the BSP or the
custodian bank upon registration of the foreign investment and serves as the
authority to repatriate such divestment and sales proceeds or remittance of
cash dividends.  Effective April 3, 2000, only pre-numbered BSRD forms, printed
on BSP security paper may be used and issued as proof of registration of
foreign investments in accordance with existing BSP rules.  The remitting
commercial bank must submit to the BSP a statement of remittance together with
the supporting documents within two banking days from date of actual
remittance.  Foreign investments not duly registered with the BSP or with the
investor's designated custodian bank are not entitled to repatriation and
remittance privileges through the banking system except capital repatriation or
dividend remittance of direct foreign equity investments made prior to March 15, 1973 when BSP registration was not yet required.  The BSP should be notified of
the transfer of sale of foreign investments in equity or securities already
registered with the BSP, in order that the registration of the foreign
investment may be transferred in the name of the transferee or purchaser.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Cash
dividends on PLDT&#146;s stock are paid in Philippine peso, except dividends on the
Series VI Convertible Preferred Stock, which are paid in U.S. dollars.  PLDT&#146;s
Transfer Agent and Dividend Paying Agent for its Series VI Convertible
Preferred Stock, Hongkong and Shanghai Banking Corporation, converts and remits
in U.S. dollars, at the prevailing exchange rate, cash dividends due to holders
of the Series VI Convertible Preferred Stock.  PLDT&#146;s Transfer Agent for its
common stock, The Hongkong and Shanghai Banking Corporation, which also acts as
dividend paying agent, converts and remits in U.S. dollars, at the prevailing
exchange rate, cash dividends due all common shareholders residing outside the Philippines.  Under the above-mentioned regulations, PLDT has been able to remit the cash
dividends due to shareholders residing outside the Philippines.  As at December
31, 2006, approximately 86% of PLDT&#146;s outstanding shares of common and
preferred stock were held by Philippine persons.  For certain restrictions on
the declaration and payment of dividends by PLDT, see <i>Note 14 &#150; Preferred
Stock Subject to Mandatory Redemption</i> and <i>Note 15 &#150; Stockholders&#146; Equity</i>
to the accompanying consolidated financial statements in Item 18.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Principal
of and interest on PLDT&#146;s 10.5% Notes due 2009, 11.375% Notes due 2012 and
8.35% Notes due 2017 are payable in U.S. dollars which may be purchased from
the local banking system either pursuant to the registration of such Notes with
the BSP or otherwise pursuant to specific BSP approval of such payment.  Such
principal and interest may also be paid utilizing PLDT's own dollar resources
without necessity of BSP approval.  The BSP, with the approval of the President
of the Philippines, may, however, restrict the availability of foreign exchange
during an exchange crisis, when an exchange crisis is imminent, or in times of
national emergency.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286188"></a><a name="_Toc75779247"></a><a
name="_Toc46082307"><b>Taxation</b></a></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following is a description of the material Philippine and United States federal
income tax consequences to United States Holders (as defined below) of owning
shares of Common Stock and ADSs.  It applies to you only if you hold your Common
Stock or ADSs as capital assets for tax purposes.  This section does not apply
to you if you are a member of a special class of holders subject to special
rules, including a dealer in securities, a trader in securities that elects to
use a mark-to-market method of accounting for securities holdings, a tax-exempt
organization, a life insurance company, a person liable for alternative minimum
tax, a person that actually or constructively owns 10% or more of PLDT&#146;s voting
stock, a person that holds Common Stock or ADSs as part of a straddle or a
hedging or conversion transaction, or a United States Holder (as defined below)
whose functional currency is not the U.S. dollar.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">This
section is based on the United States Internal Revenue Code of 1986, as amended
(the &#147;U.S. Tax Code&#148;), its legislative history, existing and proposed
regulations, published rulings and court decisions, and the laws of the
Philippines including the Philippine National Internal Revenue Code of 1997
(the &#147;Philippine Tax Code&#148;) all as currently in effect, as well as on the
Convention Between the Philippines and the United States (the
&#147;Philippines-United States Tax Treaty&#148;).  These laws are subject to change,
possibly on a retroactive basis.  In addition, this section is based in part on
the representations of the Depositary and the assumption that each obligation
in the Deposit Agreement and any related agreement will be performed according
to its terms.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in;
line-height:normal' style="margin-top:0;margin-bottom:0">You are a
United States Holder if you are a beneficial owner of Common Stock or ADSs and
you are a citizen or resident of the United States, a domestic corporation, an
estate whose income is subject to United States federal income tax regardless
of its source, or a trust if a United States court can exercise primary
supervision over the trust&#146;s administration and one or more United States
persons are authorized to control all substantial decisions of the trust.</p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
general, taking into account the earlier assumptions, for United States federal income tax purposes, if you hold ADRs evidencing ADSs, you will be treated as
the owner of the shares represented by those ADRs.  Exchanges of shares for
ADRs, and ADRs for shares, generally will not be subject to United States federal income tax.</p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0">This discussion addresses only United States federal income taxation and Philippine income taxation, estate and donor&#146;s
taxation, stock transaction taxation and documentary stamp taxes.</p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Philippine Taxation</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Taxes on Exchange of ADSs for Common Stock </i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Philippine capital gains or stock transaction taxes
and documentary stamp taxes may be payable upon the transfer of shares of
Common Stock to a holder of ADRs to a holder of GDRs.  See &#147;&#150;&#150; Capital Gains
Tax and Stock Transaction Tax&#148; and &#147;&#150;&#150; Documentary Stamp Taxes.&#148;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Taxation
of Dividends</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Under
the Philippine Tax Code, dividends paid by a Philippine corporation to citizens
of the Philippines and resident aliens in the Philippines are subject to a
final withholding tax of 10% while those paid to non-resident aliens engaged in
trade or business within the Philippines are subject to a final withholding tax
of 20%.  Dividends paid to non-resident aliens not engaged in trade or business
within the Philippines are subject to a final withholding tax of 25%.  Dividends
paid by a Philippine corporation to other Philippine corporations or to
resident non-Philippine corporations are not subject to tax.  Dividends paid to
non-resident non-Philippine corporations not engaged in a trade or business in
the Philippines by Philippine corporations shall be subject to a final
withholding tax of 15%, subject to the condition that the country in which the
non-resident non-Philippine corporation is domiciled either (i) allows a credit
against the tax due from the non-resident non-Philippine corporation taxes
deemed to have been paid in the Philippines equivalent to 20% effective November
1, 2005 (which represents the difference between the regular income tax on
non-resident non-Philippine corporations of 35% effective November 1, 2005 and
the 15% tax on dividends) (this condition is not satisfied in the case of
corporations domiciled in the United States if such corporations own less than
10% of the voting stock of PLDT) or (ii) imposes no income taxes on dividends
received by such non-resident non-Philippine corporations from Philippine
corporations (this condition is not satisfied in the case of corporations
domiciled in the United States).  If neither of the foregoing conditions are
met, the dividends paid to the non-resident non-Philippine corporation shall be
subject to the regular income tax rate of 35% effective November 1, 2005.
Under rulings issued by Philippine tax authorities, Hong Kong is viewed as
falling within clause (ii) and, thus, companies that are organized in Hong Kong
that are not engaged in trade or business in the Philippines may be entitled to
the benefit of the 15% rate.  Such rulings, however, were based upon the laws
of Hong Kong as in effect at the time such rulings were issued, and any
subsequent changes in the relevant laws of Hong Kong may affect the validity of
such rulings.  PLDT reserves the right to change the rate at which it makes
payments of withholding tax whenever it deems it appropriate under applicable
law.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">If
the holder of Common Stock is a non-resident foreign partnership, which is
treated as a corporation for Philippine tax purposes, dividends on the Common
Stock should be subject to a final withholding tax of 35% effective November 1,
2005.  Cede &amp; Co., the partnership nominee of Depository Trust Company
(&#147;DTC&#148;), should qualify as a non-resident foreign partnership that would be
treated as a corporation for Philippine tax purposes.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
certain circumstances where the holder holds Common Stock, a tax treaty rate
may be applicable with respect to the Philippine withholding tax.  For
instance, holders under such circumstances and as to which the
Philippines-United States Tax Treaty would be applicable would be eligible for
a treaty rate of 25% (or 20% in certain instances).  The 20% treaty rate is
generally not applicable in the case of non-resident non-Philippine
corporations domiciled in the United States which own less than 10% of the
voting stock of PLDT.  Holders are required, however, to establish to the
Philippine taxing authorities their eligibility for such treaty rate.
Philippine tax authorities have prescribed, through an administrative issuance,
procedures for availment of tax treaty relief.  PLDT intends to pay withholding
tax at the reduced treaty rate in respect of shares the registered holder of
which is Cede &amp; Co., on the basis that Cede &amp; Co. is a resident of the United States for purposes of the Philippines-United States Tax Treaty.  PLDT reserves the
right to change the rate at which it makes payments of withholding tax whenever
it deems it appropriate under applicable law.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Capital
Gains Tax and Stock Transaction Tax</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
Philippine Tax Code provides that gain from the sale of shares of stock in a
Philippine corporation shall be treated as derived entirely from sources within
the Philippines, regardless of where the shares are sold.  Subject to
applicable tax treaty rates, the rate of tax on such gain, where the share is
not disposed of through the Philippine Stock Exchange, is a final tax of 5% for
gains not exceeding Php100,000 and a final tax of 10% for gains in excess of
that amount.  The rate is the same for both non-resident individuals and
non-resident non-Philippine corporations.  While this tax is not collected
through withholding, the Philippine Tax Code prohibits a transfer from being
recorded on the books of the corporation unless the Philippine Commissioner of
Internal Revenue certifies that the tax has been paid or certain other
conditions are met.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The sale of shares which are
listed in and sold through the PSE are subject to the stock transaction tax
imposed at the rate of 1/2 of 1% of the gross selling price.  This tax is
required to be collected and paid to the government by the selling stockbroker
on behalf of his client.  Sales of shares other than through a Philippine stock
exchange will be subject to Philippine capital gains tax in the manner described
above.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Under
the Philippines-United States Tax Treaty, gains derived by a United States
resident from the sale of shares of stock of a Philippine corporation will not
be subject to capital gains tax where the share is not disposed of through the
Philippine Stock Exchange, unless the shares are those of a corporation over
50% of the assets of which consist of real property interests located in the
Philippines.&nbsp; PLDT does not believe that it currently is such a
corporation.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Documentary Stamp Taxes</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
 Philippines imposes a documentary stamp tax upon transfers of shares of stock
issued by a Philippine corporation at a rate of Php0.75 on each Php200, or
fractional part thereof, of the par value of the shares.  The documentary stamp
tax is collectible wherever the document is made, signed, issued, accepted or
transferred, when the obligation or right arises from Philippine sources or the
property is situated in the Philippines.  Effective March 20, 2004, the
documentary stamp tax rate upon transfer of shares of stock issued by a
Philippine corporation was decreased from Php1.50 to Php0.75 on each Php200, or
fractional part thereof, of the par value of the shares.  However, the
imposition of documentary stamp tax on secondary transfer of shares of stock of
a Philippine Corporation which is listed and traded through the facilities of
the Philippine Stock Exchange is suspended for a period of five years counted
from the same effective date.   </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Estate
and Donor&#146;s Taxes</i></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Shares
of stock issued by a corporation organized or constituted in accordance with
Philippine law are deemed to have a Philippine situs and their transfer by way
of succession or donation is subject to Philippine estate and gift taxes.  The
transfer of shares of stock by a deceased individual to his heirs by way of
succession, whether such an individual was a citizen of the Philippines or an
alien, regardless of residence, will be subject to Philippine estate tax at
progressive rates ranging from 5% to 20% if the net estate is over Php200,000.  Individual
and corporate shareholders, whether or not citizens or residents of the
Philippines, who transfer the Equity Securities by way of gift or donation will
be liable for Philippine donor&#146;s tax on such transfers at progressive rates
ranging from 2% to 15%, if the net gifts made during the calendar year exceed
Php100,000.  The rate of tax with respect to net gifts made to a stranger, who
is not a brother, sister, spouse, ancestor, lineal descendant or relative by
consanguinity in the collateral line within the fourth degree of relationship
of the donor, is a flat rate of 30%.  Estate and gift taxes will not be
collected in respect of intangible personal property such as the Equity
Securities:</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
if the deceased at the time of
death, or the donor at the time of donation, was a citizen and resident of a
foreign country which at the time of his death or donation did not impose a
transfer tax of any character in respect of intangible personal property of
citizens of the Philippines not residing in that foreign country, or</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
if the laws of the foreign country
of which the deceased or the donor was a citizen and resident at the time of
his death or donation allow a similar exemption from transfer or death taxes of
every character or description in respect of intangible personal property owned
by citizens of the Philippines not residing in that foreign country.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Shares
of stock of a deceased shareholder or shares that have been donated may not be
transferred on the books of the corporation without a certificate from the
Philippine Commissioner of Internal Revenue that the applicable estate or
donor's taxes have been paid.  In the case of ADRs, however, there is no
corresponding requirement, unless a transfer of the ADRs would also entail a
change in the registration of the underlying shares.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>United States</i><i> Federal Taxation </i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">For United States federal income tax purposes, United States Holders of ADRs will be treated as
the owners of the underlying shares of Common Stock.  Deposits and withdrawals
by United States Holders of shares of Common Stock in exchange for ADRs will
not be subject to United States federal income tax.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Taxation of Dividends</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Under
the United States federal income tax laws, and subject to the passive foreign
investment company, or PFIC, rules discussed below, if you are a United States
Holder, the gross amount of any dividend we pay out of our current or
accumulated earnings and profits (as determined for United States federal
income tax purposes) is subject to United States federal income taxation.  If
you are a non-corporate United States Holder, dividends paid to you in taxable
years beginning before January 1, 2011 that constitute qualified dividend
income will be taxable to you at a maximum tax rate of 15% provided that, in
the case of Common Stock or ADSs, you hold the Common Stock or ADSs for more
than 60 days during the 121-day period beginning 60 days before the ex-dividend
date.  Dividends we pay with respect to the Common Stock or ADSs generally will
be qualified dividend income.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">You
must include any Philippine tax withheld from the dividend payment in this
gross amount even though you do not in fact receive it.  The dividend is
taxable to you when you, in the case of Common Stock, or the Depositary, in the
case of ADSs, receive the dividend, actually or constructively.  The dividend
will not be eligible for the dividends-received deduction generally allowed to United States corporations in respect of dividends received from other United States corporations.
The amount of the dividend distribution that you must include in your income as
a United States Holder will be the U.S. dollar value of the Philippine peso
payments made, determined at the spot Philippine peso/U.S. dollar rate on the
date the dividend distribution is includible in your income, regardless of
whether the payment is in fact converted into U.S. dollars.  Generally, any
gain or loss resulting from currency exchange fluctuations during the period
from the date you include the dividend payment in income to the date you convert
the payment into U.S. dollars will be treated as ordinary income or loss and
will not be eligible for the special tax rate applicable to qualified dividend
income.  The gain or loss generally will be income or loss from sources within
the United States for foreign tax credit limitation purposes.  Distributions in
excess of current and accumulated earnings and profits, as determined for United States federal income tax purposes, will be treated as a non-taxable return of
capital to the extent of your basis in the Common Stock or ADSs and thereafter
as capital gain. </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Subject
to certain limitations, the Philippine tax withheld in accordance with the Philippines-United States Tax Treaty and paid over to the Philippines will be creditable or
deductible against your United States federal income tax liability.  Special
rules apply in determining the foreign tax credit limitation with respect to
dividends that are subject to the maximum 15% tax rate.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Dividends
will be income from sources outside the United States.  Dividends paid in taxable years beginning before
January 1, 2007 generally will be &#147;passive&#148; or &#147;financial services&#148; income, and
dividends paid in taxable years beginning after December 31, 2006 will,
depending on your circumstances, be &#147;passive&#148; or &#147;general&#148; income which, in
either case, is treated separately from other types of income for purposes of
computing the foreign tax credit allowable to you.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Sale</i><i> or Other Disposition of Equity Securities</i></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Subject to the PFIC rules
discussed below, a United States Holder will recognize capital gain or loss
upon the sale of <a name="OLE_LINK26"></a><a name="OLE_LINK25">Common Stock or
ADSs </a>in an amount equal to the difference between such United States
Holder's basis in the Common Stock or ADSs and the amount realized upon the
sale.  Such gain or loss generally will be long-term capital gain or loss if,
at the time of sale, exchange or retirement, the Common Stock or ADSs have been
held for more than one year.  Capital gain of a non-corporate U.S. holder that is recognized in taxable years beginning January 1, 2011 is generally taxed at a
maximum rate of 15% where the property is held for more than one year.
Generally, any such gain or loss will be treated as realized income or loss
from sources within the United States for foreign tax credit limitation purposes.
United States Holders may not be eligible to credit against their United States federal income tax liability amounts paid in respect of the Philippine stock
transaction tax.  See &#147;&#151; Philippine Taxation &#151; Capital Gains Tax and Stock
Transaction Tax.&#148;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
U.S. Tax Code does not authorize a comparable credit for foreign gift or
donor's taxes such as those imposed by the Philippines.  See &#147;&#151; Philippine
Taxation &#151; Estate and Donor&#146;s Taxes.&#148;</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Passive
Foreign Investment Company Rules</i></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
believe that the Common Stock or ADSs should not be treated as stock of a PFIC
for United States federal income tax purposes, but this conclusion is a factual
determination that is made annually and thus may be subject to change.  If we
were to be treated as a PFIC, unless the Common Stock or ADSs are &#147;marketable
stock&#148; and a United States Holder elects to be taxed annually on a
mark-to-market basis with respect to the Common Stock or ADSs, gain realized on
the sale or other disposition of your Common Stock or ADSs would in general not
be treated as capital gain.  Instead, if you are a United States Holder, you
would be treated as if you had realized such gain and certain &quot;excess
distributions&quot; ratably over your holding period for the Common Stock or
ADSs and would be taxed at the highest tax rate in effect for each such year to
which the gain was allocated, together with an interest charge in respect of
the tax attributable to each such year.  In addition, dividends that you
receive from us will not be eligible for the special tax rates applicable to
qualified dividend income if we are a PFIC either in the taxable year of the
distribution or the preceding taxable year, but instead will be taxable at
rates applicable to ordinary income.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286189"></a><a name="_Toc75779248"></a><a
name="_Toc46082310"><b>Documents on Display</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
are subject to the informational requirements of the Exchange Act, and file
reports and other information with the Commission, as required by this Act.
Reports and other information filed by us with the Commission may be inspected
and copied at the Commission&#146;s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549.  The public may obtain information on the operation of the
Commission&#146;s Public Reference Room by calling the Commission in the United States at 1-800-SEC-0330.  The Commission also maintains a website that contains
reports, proxy statements and other information regarding registrants that file
electronically with the Commission.  Copies of these materials may be obtained
by mail from the public reference section of the Commission, 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates.  These reports and other
information may also be inspected at the offices of the New York Stock
Exchange, 20 Broad Street, New York, New York 10005, on which the American
Depositary Shares representing our Common Stock are listed.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286190"></a><a name="_Toc75779249"></a><a
name="_Toc46082311"><b>Item 11.    Quantitative
and Qualitative Disclosures about Market Risks</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our operations are exposed to various risks, including
liquidity risk, foreign exchange risk and interest rate risk.  The importance
of managing these risks has significantly increased in light of considerable
change and continuing volatility in both the Philippine and international
financial markets.  With a view to managing these risks, we have incorporated
financial risk management functions in our organization, particularly in our
treasury operations and equity issues and sales of certain assets.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286191"></a><a name="_Toc75779250"></a><a
name="_Toc46082312"><b>Liquidity Risk Management</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">We seek to manage our liquidity profile to be able to
finance our capital expenditures and service our maturing debts.  To cover our
financing requirements, we currently intend to use internally generated funds
and proceeds from debt and equity issues and sales of certain assets. </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
part of our liquidity risk management program, we regularly evaluate our
projected and actual cash flow information and continuously assess conditions
in the financial markets for opportunities to pursue fund-raising initiatives.
These initiatives may include bank loans, export credit agency-guaranteed
facilities, and debt capital and equity market issues</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286192"></a><a name="_Toc75779251"></a><a
name="_Toc46082313"><b>Foreign Exchange Risk
Management</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, the Philippine peso had appreciated by 8% against the
U.S. dollar to Php49.045 to US$1.00 from Php53.062 to US$1.00 as at December
31, 2005.  As at December 31, 2005, likewise, the peso appreciated by 6% to
Php53.062 to US$1.00 from Php56.341 to US$1.00 as at December 31, 2004.  The
revaluation of our foreign currency-denominated assets and liabilities is
recognized as foreign exchange gains or losses as at the balance sheet date.
Since substantially all of our indebtedness is denominated in U.S. dollars, the
appreciation or depreciation of the Philippine peso results in the recognition
of foreign exchange gains or losses.  The extent of foreign exchange gains or
losses is largely dependent on the amount of foreign currency debt and hedges
we carry.  As at December 31, 2006, consolidated foreign currency-denominated
debt amounted to Php76,647 million, a reduction from Php101,423 million as at
December 31, 2005.  As such, we recognized foreign exchange gains of Php2,008
million and Php4,906 million in 2006 and 2005, respectively.  </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table shows our consolidated foreign
currency-denominated monetary assets and liabilities and their peso equivalents
as at December 31, 2006 and 2005:</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:92.24%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">U.S. Dollar</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Php Equivalent(1)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">U.S. Dollar</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Php Equivalent(2)</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Current Financial Assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash and cash equivalents</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$154</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php7,578</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$244</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php12,957</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Short-term investments</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">92</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,521</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">55</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,934</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Trade and other receivables</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,348</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">139</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,371</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">47</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 current financial assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 499</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">24,494</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 439</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">23,299</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p style="margin-top:0;margin-bottom:0">Noncurrent Financial Assets</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0">Derivative
 assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">434</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">50</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0">Notes
 receivable</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">346</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 noncurrent financial assets</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">   9</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 434</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">  56</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,994</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0">Total
 Financial Assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$508</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php24,928</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$495</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php26,293</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style="margin-top:0;margin-bottom:0">Current Financial
 Liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accounts
 payable</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$122</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php5,968</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$42</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php2,227</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accrued
 expenses and other current liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">208</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,194</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">68</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,587</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">108</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p style='margin-left:17.6pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0">Current portion of interest-bearing financial
 liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">327</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,027</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">337</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">17,867</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 current financial liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">659</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">32,297</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 450</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">23,873</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p style="margin-top:0;margin-bottom:0">Noncurrent Financial
 Liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:17.6pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Interest-bearing financial liabilities - net of
 current portion</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,356</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">66,510</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,738</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">92,218</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">140</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,872</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,777</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.65pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Preferred
 stock subject to mandatory redemption</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">27</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,308</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">221</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">11,702</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 noncurrent financial liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,523</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">74,690</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,068</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">109,697</p>
 </td>
 </tr>
 <tr style='height:8.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Total
 Financial Liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$2,182</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php106,987</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$2,518</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:8.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php133,570 </p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>(1)</i><i>   The exchange
rate used was Php</i><i>49.045 to US$1.00.</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>(2)     </i><i>The exchange
rate used was Php53.062 to US$1.00.</i></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">While
a certain percentage of our revenues is either linked to or denominated in U.S.
dollars, substantially all of our indebtedness and related interest expense, a
substantial portion of our capital expenditures and a portion of our operating
expenses are denominated in foreign currencies, mostly in U.S. dollars.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">As at December 31, 2006,
approximately 96% of our total consolidated debts were denominated in foreign
currencies, principally in U.S. dollars.  Thus, a strengthening or weakening of
the Philippine peso against the U.S. dollar will decrease or increase,
respectively, both the principal amount of our unhedged foreign
currency-denominated debts (representing 43% of our consolidated debts, or 31%
net of our U.S. dollar cash balances as at December 31, 2006), and interest
expense on our debt in Philippine peso terms.  In addition, many of our
financial ratios and other financial tests are affected by the movements in the
Philippine peso to U.S. dollar exchange rate.  For further information on our loan covenants, see Item 5. &#147;Operating
and Financial Review and Prospects &#151; Liquidity and Capital Resources &#151;
Financing Activities &#151; Debt Financing &#151; Debt Covenants&#148; above and <i>Note 12 &#150;
Interest-bearing Financial Liabilities</i> to the accompanying consolidated
financial statements in Item 18.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">To
manage our foreign exchange risks, stabilize cash flows, and improve investment
and cash flow planning, we enter into forward foreign exchange contracts,
foreign currency swap contracts, currency option contracts and other hedging
products aimed at reducing and/or managing the adverse impact of changes in
foreign exchange rates on our operating results and cash flows.  However, these
hedges do not cover all of our exposure to foreign exchange risks.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Specifically,
we use forward foreign exchange contracts, foreign currency swap contracts and
currency option contracts to manage the foreign currency risk associated with
our foreign currency-denominated loans.  In order to manage hedge costs of
these contracts, we utilize structures that include credit-linkage with PLDT as
the reference entity, a combination of currency option contracts, and fixed to
floating coupon only swap agreements.  Accounted for as either cash flow hedges
or transactions not designated as hedges, changes in the fair value of these
instruments are recognized as accumulated other comprehensive income (loss) cumulative
translation adjustments in equity until the hedged item is recognized directly
as income or expense for the period.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, PLDT&#146;s outstanding forward foreign exchange contracts,
principal-only long-term cross-currency swap contracts, and currency option
contracts amounted to US$202 million, US$550 million, and US$174 million,
respectively.  Smart had no outstanding forward foreign exchange contracts as
at December 31, 2006.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286193"></a><a name="_Toc75779252"></a><a
name="_Toc46082314"><b>Interest Rate Risk
Management</b></a><b> </b></p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">On
a limited basis, we enter into interest rate swap agreements in order to manage
our exposure to interest rate fluctuations.  We make use of hedging instruments
and structures solely for reducing or managing financial risks associated with
our liabilities and not for trading or speculative purposes.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The tables below set out the
carrying amount, by maturity, of our financial instruments that are exposed to
interest rate risk for the years ended December 31, 2006 and 2005.  Financial
instruments that are not subject to interest rate risk were not included in the
table:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Year
Ended December 31, 2006</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:93.5%;;border-collapse:collapse'>

 <tr>
 <td   colspan=4 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td style='border:none;padding:0in 0in 0in 0in'  ><p style="margin-top:0;margin-bottom:0">&nbsp;</td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=4 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.5pt'>
 <td   colspan=4 rowspan=2 valign=bottom style='
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Over 5 </b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In U.S. </b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Carrying Value</b></p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:
 7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Fair Value</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.5pt'>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In U.S.</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Below 1 year</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>1-2 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2 &#150; 3 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3-5 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Dollar</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Dollar</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 </tr>

 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Liabilities:</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Long-term Debt</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Fixed Rate</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$ Notes (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">129</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">167</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">550</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">845</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">41,463</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">965</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">47,349</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">7.85% to <br>
 10.625%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10.50%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.35% to 11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$ Fixed Loans (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">69</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">56</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">46</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">280</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 483</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">23,682</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">361</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">17,712</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1.75% to<br>
 10%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4.49% to 10%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4.49% to 10%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4.515% to 4.70%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2.25%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Philippine Peso (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">  17</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 810</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,035</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Variable Rate</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">U.S. Dollar (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">128</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">92</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">81</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">53</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">355</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">17,392</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">355</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">17,392</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">GOVCO&#146;s Cost + 0.20%; 0.05% to 2.75% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">0.05% to 2.75% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">0.05% to 2.75% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">0.05% to 2.5% over
 LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Philippine Peso (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">  51</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,511</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,511</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3% over </p>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">90-day PHIBOR, MART1 + 0.75%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">MART1 + 0.75%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">MART1 + 0.75%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">MART1 + 0.75%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>1,751</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>85,858</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>1,753</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>85,999</b></p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt' style="margin-top:0;margin-bottom:0"><i>Interest
 rate swap (fixed to floating)</i></p>
 </td>
 <td   colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">U.S. Dollar (US$63 million)</p>
 </td>
 <td   colspan=4 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">423</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">423</p>
 </td>
 </tr>
 <tr>
 <td   colspan=3 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Japanese Yen (JPY7,519 million)</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Fixed Rate on US$ notional </p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   colspan=4 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt' style="margin-top:0;margin-bottom:0">Variable Rate on JPY notional</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Year
Ended December 31, 2005</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:95.0%;;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.5pt'>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Over 5 </b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In U.S. </b></p>
 </td>
 <td   colspan=2 rowspan=2 valign=bottom style='
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Carrying Value</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:
 7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Fair Value</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.5pt'>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 height:7.5pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In U.S.</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt;height:7.5pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Below 1 year</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>1-2 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2 &#150; 3 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3-5 years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>years</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Dollar</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Dollar</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions)</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Liabilities:</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Long-term Debt</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Fixed Rate</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$ Notes (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">115</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">159</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">175</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">549</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">998</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">52,980</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,108</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">58,780</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">9.25%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">7.85% to 10.625%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10.50%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.35% and 11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$ Fixed Loans (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">64</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">31</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">22</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">280</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 442</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">23,451</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">327</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">17,350</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4.49% to 7.75%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">4.49% to 7.58%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4. 49% to 7.58%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4.49% to 5.65%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2.25%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Japanese Yen (in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">  59</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,139</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">59</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,158</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2.125%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2.125%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2.125%</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Philippine Peso (in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,580</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,795</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">15.816%  to 24%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15.0%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Variable Rate</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">U.S. Dollar (in millions)</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">129</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">143</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">79</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">117</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">94</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 562</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">29,806</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">562</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">29,806</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">GOVCO&#146;s Cost + 0.20%; 0.05% to 3.625% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">GOVCO&#146;s Cost + 0.20%; 0.05% to 3.625% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">0.05% to 3.625% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">.05% to 2.5% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Japanese Yen (in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">  13</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">709</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">709</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1.70% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1.70% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1.70% over LIBOR</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Philippine Peso (in millions)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   colspan=2 valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">648</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">648</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Interest rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1% over 91-day T-bill rate, 90-day PHIBOR + 3%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1% over 91-day T-bill
 rate </p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1% over 91-day T-bill
 rate</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,116</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>112,313</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,115</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>112,246</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Interest rate swap (fixed to floating)</i></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">U.S. Dollar (US$125 million)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,569</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Japanese Yen (JPY15,037 million)</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Fixed Rate on US$ notional </p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Variable Rate on JPY notional</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.11% over LIBOR</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286194"></a><a name="_Toc75779253"></a><a
name="_Toc46082315"><b>Item 12.    Description
of Securities Other than Equity Securities</b></a></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Not Applicable.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><a name="_Toc170286195"></a><a
name="_Toc75779254"></a><a name="_Toc46082316">PART
II</a></h1>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286196"></a><a name="_Toc75779255"></a><a
name="_Toc46082317"><b>Item 13.    Defaults,
Dividend Arrearages and Delinquencies</b></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">As at December 31, 2006,
Piltel had outstanding convertible bonds with a principal amount of US$0.7
million.  These were redeemed and paid, including accrued interest, on March
30, 2007.  See <i>Note 12 &#150; Interest-bearing Financial Liabilities</i> to the
accompanying consolidated financial statements in Item 18.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
Series C, Class I Preferred Stock of Piltel is entitled to annual cumulative
cash dividends of Php0.20 per share (10% on the par value per share).  As at
the date of this annual report on Form 20-F, the total arrearage with respect
to the Series C, Class I Preferred Stock of Piltel amounted to approximately Php7
million. </p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286197"></a><a name="_Toc75779256"></a><a
name="_Toc46082318"><b>Item 14.    Material
Modifications to the Rights of Security Holders and Use of Proceeds</b></a></p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">None.</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc75779257"></a><a name="_Toc46082319">&nbsp;</a></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286198"><b>Item
15.    Controls and Procedures</b></a></p>

<p style='text-indent:.5in;line-height:9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Disclosure
Controls and Procedures.</b>  Our
management, with the participation of our principal executive officer and principal
financial officer, carried out an evaluation on the effectiveness of our
disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e)
of the Securities Exchange Act of 1934, as amended) as at December 31, 2006.
Based on this evaluation, our chief executive officer and principal financial
officer concluded that our disclosure controls and procedures were effective as
at December 31, 2006. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Management&#146;s
Annual Report on Internal Control Over Financial Reporting.</b>  Management is responsible for establishing and
maintaining adequate internal control over financial reporting.  Our internal
control over financial reporting is a process designed under the supervision of
our principal executive and principal financial officers to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of our financial statements for external reporting purposes in accordance with
PFRS and U.S. GAAP.  Our internal control over financial reporting includes
policies and procedures that pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect transactions and dispositions
of assets; provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with PFRS
and U.S. GAAP, and that receipts and expenditures are being made only in
accordance with authorizations of our management and directors; and provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of our assets that could have a material effect
on our financial statements. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
management conducted an assessment of the effectiveness of our internal control
over financial reporting based on the framework established in Internal Control
&#150; Integrated Framework issued by the Committee of Sponsoring Organizations of
the Treadway Commission (COSO). Based on this assessment, management has
determined that our internal control over financial reporting as at December
31, 2006 is effective.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Management&#146;s
assessment of the effectiveness of our internal control over financial
reporting as at December 31, 2006 has been audited by Sycip Gorres Velayo &amp;
Co., an independent registered public accounting firm, as stated in their
report appearing on the accompanying consolidated financial statements in Item
18, which expresses  an unqualified opinion on management&#146;s assessment and on
the effectiveness of our internal control over financial reporting as at
December 31, 2006. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Changes
in Internal Control Over Financial Reporting.  </b>During 2006, no change to our internal control over
financial reporting occurred that has materially affected, or is reasonably
likely to materially affect, our internal control over financial reporting.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b>Attestation
Report of the Registered Public Accounting Firm.  </b>The attestation report of Sycip Gorres Velayo &amp;
Co., an independent registered public accounting firm, regarding its audit of
PLDT Group&#146;s internal control over financial reporting is set forth in Item 18
&#147;Financial Statements&#148;.</p>

<p style='text-indent:.5in;line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286199"></a><a name="_Toc75779258"></a><a
name="_Toc46082320"><b>Item 16A. Audit Committee
Financial Expert</b></a></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
board of directors has determined that currently none of the members of the
Audit Committee is an audit committee financial expert as defined under the
applicable rules of the U.S. SEC issued pursuant to Section 407 of the
Sarbanes-Oxley Act of 2002.  However, our board of directors believes that the
audit committee members along with its advisors, possess sufficient financial
knowledge and experience.  Our board of directors has appointed one of our
non-independent directors, Ms. Corazon de la Paz, as Audit Committee advisor to
render advice on complex financial reporting or accounting issues that may be
raised in our Audit Committee&#146;s evaluation of our financial statements and
other related matters.  Formerly the Chairman and a Senior Partner of Joaquin
Cunanan &amp; Company (a member firm of PricewaterhouseCoopers Worldwide), Ms. Corazon
de la Paz is a certified public accountant and possesses in-depth knowledge of
accounting principles (including U.S. GAAP), internal controls and procedures
for financial reporting and audit committee functions, as well as extensive
experience in overseeing or actively supervising the preparation, audit,
analysis or evaluation of financial statements and in addressing complex and
general financial reporting, accounting and audit issues.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK43"></a><a name="OLE_LINK42"></a><a
name="_Toc170286200"></a><a name="_Toc75779259"><b>Item
16B. Code of Business Conduct and Ethics</b></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
March 30, 2004, our board of directors approved and adopted our Code of
Business Conduct and Ethics, or Code of Ethics, that sets out our business
principles and standards of behavior and business relationships.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">It is our declared objective that
all our actions and those of our directors, officers and employees must, at all
times, be consistent with the principles of accountability, integrity, fairness
and transparency.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our Code of Ethics provides
standards to foster honest and ethical behavior including the following:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-align:justify;text-indent:
- -.25in' style="margin-top:0;margin-bottom:0">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Compliance with applicable laws,
rules and regulations;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Ethical handling of conflicts of
interest, corporate opportunities and confidential information;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-align:justify;text-indent:
- -.25in' style="margin-top:0;margin-bottom:0">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Protection and proper use of our
assets;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-align:justify;text-indent:
- -.25in' style="margin-top:0;margin-bottom:0">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Fair dealing with our employees,
customers, service providers, suppliers and competitors;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-align:justify;text-indent:
- -.25in' style="margin-top:0;margin-bottom:0">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Compliance with our reporting and
disclosure obligations to the relevant regulators and the investors;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-align:justify;text-indent:
- -.25in' style="margin-top:0;margin-bottom:0">6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Compliance with our disclosure and
financial reporting controls and procedures;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-align:justify;text-indent:
- -.25in' style="margin-top:0;margin-bottom:0">7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Assessment and management of risks
involved in our business endeavours; and</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-align:justify;text-indent:
- -.25in' style="margin-top:0;margin-bottom:0">8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Adoption of international best
practices of good corporate governance in the conduct of our business.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Corporate
Governance</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
Code of Ethics was adopted to strengthen the implementation of our Corporate
Governance Manual, or Governance Manual, which was adopted and approved by our
board of directors in September 2002.  Our Governance Manual seeks to
institutionalize the principles of good governance that our board of directors
and management believe to be a necessary component of sound business
management.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our
Governance Manual conforms with the requirements of the Code of Corporate
Governance, or Philippine SEC Governance Code, that was promulgated by the
Philippine Securities and Exchange Commission, or Philippine SEC, under the
Philippine SEC Memorandum Circular No. 2, Series of 2002, on April 5, 2002, in
line with the Philippine Government&#146;s policy to promote corporate governance
reform aimed to raise investor confidence, develop capital market and help
achieve sustained growth for the Philippine corporate sector and the economy.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In compliance with the Philippine SEC Governance Code
and consistent with the relevant provisions of the Securities Regulation Code
and Corporation Code of the Philippines, our Governance Manual covers the
following key areas:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-align:justify;text-indent:
- -.25in' style="margin-top:0;margin-bottom:0">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The qualifications and grounds for
disqualification for directorship;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The requirement that at least two
or twenty percent of the members of our board of directors, whichever is
lesser, must be independent directors and the standards/criteria for the
determination of independent directors;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The duties and responsibilities of
our board of directors and the individual directors;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our board committees,
specifically, the nomination committee, audit committee and executive
compensation committee, the composition and the principal duties and
responsibilities of such committees;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The role of our chairman in
ensuring compliance with the corporate governance principles;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The role of our president/chief
executive officer in ensuring that our organizational and procedural controls
are adequate and effective to ensure reliability and integrity of financial and
operational information, effectiveness and efficiency of operations,
safeguarding of assets and compliance with laws, rules, regulations and
contracts;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The duties and responsibilities of
our corporate secretary/assistant corporate secretary in terms of the support
services that they need to provide our board in upholding sound corporate
governance;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The duties and responsibilities of
the head of our internal audit organization that would provide our board of directors,
management and shareholders with reasonable assurance that our key
organizational and procedural controls are appropriate, adequate, effective and
reasonably complied with;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The functions of our independent
auditors that would reasonably ensure an environment of sound corporate
governance as reflected in our financial records and reports; the requirement
that non-audit work of the independent auditors should not conflict with their
function as independent auditors; the requirement to rotate, at least once
every five years, the independent auditors or the lead partner assigned to
handle the independent audit of our financial statements;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">10.&nbsp;&nbsp;&nbsp;&nbsp;
Our commitment to respect and
promote shareholders&#146; rights such as voting right, pre-emptive right,
inspection right, dividend right, appraisal right, and right to receive
information about the background, business experience, compensation and
shareholdings of our directors and officers and their transactions with us;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">11.&nbsp;&nbsp;&nbsp;&nbsp;
The requirement to appoint a
compliance officer and the duties and responsibilities of such compliance
officer including the establishment of an evaluation system to determine and
measure compliance with the provisions of our Governance Manual; and</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">12.&nbsp;&nbsp;&nbsp;&nbsp;
The penalties for violations of
our Governance Manual.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We
have also summarized in our website the differences between our corporate
governance practices and those required of U.S. listed companies under NYSE
Section 303A.11.  </p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">To
access our Code of Ethics, Governance Manual or the differences between our corporate
governance practices and those required of U.S. listed companies under NYSE
Section 303A.11, please refer to:</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">http://www.pldt.com.ph/download/pldt-corpgov_manual.pdf
OR <br>
http://www.pldt.com.ph/cgov/downloads/pldt-corpgov_manual.pdf</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">http://www.pldt.com.ph/download/pldt-code_ethics.pdf
OR http://www.pldt.com.ph/cgov/downloads/Code%20of%20Ethics(BD_APPRVD)-03.30.04.pdf</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">http://www.pldt.com.ph/download/pldt-disclosure.pdf
OR <br>
http://www.pldt.com.ph/cgov/downloads/NYSE-PLDT_CG-DISC-07.01.pdf</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Chief Governance Officer</i></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our chief governance officer
is responsible for monitoring compliance with, interpreting and deciding any
issues arising from, investigating and determining violations and recommending
the disciplinary actions against violators of our Governance Manual and Code of
Ethics.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Board Committees</i></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
have four board committees, namely the governance and nomination, audit,
executive compensation and technology strategy committees.  Each committee has
a board-approved written charter that provides for such committee&#146;s
composition, membership qualifications, functions and responsibilities, conduct
of meetings, and reporting procedure to the board.  See Item 6. &#147;Directors,
Senior Management and Employees &#150;&#150; Audit, Governance and Nomination, Executive
Compensation and Technology Strategy Committees&#148; for further details.</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Internal Audit
Organization</i></p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
have an internal audit organization that determines whether our network or risk
management, control and governance processes are adequate and functioning to ensure
that:</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Risks are appropriately identified
and managed;</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Significant financial, managerial,
and operating information are accurate, reliable, and timely;</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Employees&#146; actions are in
compliance with policies, standards, procedures, and applicable laws and
regulations;</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Resources are acquired
economically, used efficiently, and adequately protected;</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Programs, plans and objectives are
achieved;</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Quality and continuous improvement
are fostered in our control process;</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Significant legislative or
regulatory issues impacting us are recognized and addressed appropriately; and</p>

<p style='text-indent:.5in;line-height:8.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Interaction with various
governance groups occurs as needed.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">To ensure independence, the head
of our internal audit organization reports functionally to our audit committee
and administratively to our president and chief executive officer.  He is
accountable to management and our audit committee in the discharge of his
duties and is required to:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Provide annually an assessment on
the adequacy and effectiveness of our processes for controlling our activities
and managing our risks;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Report significant issues related
to the processes of controlling our activities, including potential
improvements to those processes, and provide information concerning such
issues;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Periodically provide information
on the status and results of the annual audit plan and the sufficiency of our
internal audit organization&#146;s resources; and</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Coordinate with and provide
oversight of other control and monitoring functions (risk management,
compliance, security, legal, ethics, environmental, external audit).</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our internal audit organization
has a charter that has been approved by our audit committee.  It seeks to
comply with the Standards for the Professional Practice of Internal Auditing of
The Institute of Internal Auditors in the discharge of its scope of work and
responsibilities.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK28"></a><a name="OLE_LINK27"><i>Policy on Employee Disclosure on Violations of the
Corporate Governance Rules, Questionable Accounting or Auditing Matters, and
Offenses Covered By the Company&#146;s Table of Penalties</i></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">We have expanded our written
policy on the handling of employees&#146; anonymous and non-anonymous complaints or
disclosures on violations or irregularities to cover accounting, internal
controls and auditing matters, as well as corporate governance rules and offenses
covered by our table of penalties.  Said policy also provides protection
against retaliation for those employees who make such complaints or
disclosures.  We have likewise established dedicated structures and facilities
(post office box, e-mail, hotline number, fax and website) for the submission
of such disclosures or complaints. </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Any
employee may submit a complaint or disclosure of the above nature to the
Corporate Governance Office (CGO) or the chief governance officer, verbally or
in writing.  The CGO shall conduct a preliminary evaluation to determine the
appropriate investigating unit to which the case shall be assigned for further
action.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The CGO monitors the cases
reported and ensures the appropriate reporting to our audit committee,
governance and nomination committee, or any other relevant committee or body on
the results of the investigations and the prompt referrals of findings to the
appropriate units concerned.  Our committees on officer or employee discipline,
as the case may be, are responsible for evaluating and approving the
appropriate disciplinary action against erring officers and employees.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
public may obtain information on our Code of Ethics, Governance Manual and
Charters of our Board Committees through our website.  We undertake to provide
a copy, without charge, to any person requesting for such copy from our chief
governance officer, Rene G. Ba&#241;ez<i>, </i>who can be reached at e-mail address<i>
rgbanez@pldt.com.ph </i>or telephone number +632-816-8917.  We also maintain a
website at <i>www.pldt.com.ph </i>on which reports filed by us and other
information may be accessed.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286201"></a><a name="_Toc75779260"><b>Item 16C. Principal Accountant Fees and Services</b></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following table
summarizes the fees paid for services billed by our external auditors for the
fiscal years ended December 31, 2006 and 2005:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:45.9pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Audit Fees</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php45.8</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php38.1</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Tax Fees</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1.0</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">All Other Fees</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.3</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">10.5</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>Php54.1</b></p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>Php49.6</b></p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Audit Fees</i>.  This category includes the audit
of our annual financial statements, review of interim financial statements and
services that are normally provided by the independent auditors in connection
with statutory and regulatory filings or engagements for those fiscal years.  </p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Tax Services</i>.  This category includes tax compliance, tax advice and
tax planning services performed by our independent auditors.</p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>All Other Fees</i>.  This category consists primarily of fees for
consultation with respect to our IAS adoption, Sarbanes-Oxley Act 404
compliance initiatives due diligence review for certain projects and out-of-pocket
and incidental expenses.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The fees presented above include
out-of-pocket expenses incidental to our independent auditors&#146; work, which
amounts do not exceed 5% of the agreed-upon engagement fees.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our Audit Committee pre-approves all audit and non-audit
services as these are proposed or endorsed before these services are performed
by our independent auditors.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">   </p>

<p style='page-break-after:auto' style="margin-top:0;margin-bottom:0"><a name="_Toc46082321">&nbsp;</a></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286202"></a><a name="_Toc75779261"><b>Item 16D. Exemption from the listing Standards for
Audit Committees</b></a></p>

<p style='text-indent:.5in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Not applicable.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286203"></a><a name="_Toc75779262"><b>Item 16E.  Purchases of Equity Securities by the
Issuer and Affiliated Purchaser</b></a></p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.3in;margin-bottom:.0001pt;text-indent:-.3in;line-height:normal' style="margin-top:0;margin-bottom:0">Not applicable.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><a name="_Toc170286204"></a><a
name="_Toc75779263">PART III</a></h1>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a name="_Toc46082322"></a><a
name="_Toc75779264">&nbsp;</a></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286205"><b>Item
17.    Financial Statements</b></a><b> </b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">The Company has elected to
provide the financial statements and related information specified in Item 18
in lieu of Item 17.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286206"></a><a name="_Toc75779265"><b>Item 18.    Financial Statements</b></a></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Index
to Financial Statements</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b><u>Page</u></b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:.5in;margin-bottom:
 3.0pt;margin-left:.25in;text-indent:-.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PHILIPPINE LONG DISTANCE TELEPHONE COMPANY AUDITED
 ANNUAL FINANCIAL STATEMENTS</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:3.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Attestation Report of the Independent Registered
 Public Accounting Firm </p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">144</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:3.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Report of Independent Registered Public Accounting
 Firm</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">146</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:3.0pt;line-height:normal' style="margin-top:0;margin-bottom:0">Balance Sheets as at December 31, 2006
 and 2005</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">148</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:3.0pt' style="margin-top:0;margin-bottom:0">Statements
 of Income for the Years Ended December 31, 2006, 2005 and 2004</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">149</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:3.0pt;
 margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Statements
 of Changes in Stockholders' Equity for the Years Ended December 31, 2006, 2005
 and 2004</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">150</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:3.0pt' style="margin-top:0;margin-bottom:0">Statements
 of Cash Flows for the Years Ended December 31, 2006, 2005 and 2004</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">151</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:3.0pt' style="margin-top:0;margin-bottom:0">Notes
 to Financial Statements</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-bottom:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">152</p>
 </td>
 </tr>
</table></center></div>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>

<p style="margin-top:0;margin-bottom:0"><a name="_Toc170286207"></a><a name="_Toc75779266"><b>Item 19.    Exhibits</b></a></p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">See
Item 18 above for details of the financial statements filed as part of this
annual report.</p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Exhibits
to this report:</p>

<p style='line-height:8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:99.66%;margin-left:5.4pt;border-collapse:collapse'>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">1(a).</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Articles of Incorporation (incorporated by reference to PLDT&#146;s Form
 20-F as filed with the Securities and Exchange Commission in May 2001)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">1(b).</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">By-Laws (as amended on June 28, 2005) (incorporated by reference to
 PLDT&#146;s Form 20-F as filed with the Securities and Exchange Commission in June
 2006)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">2.</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">We have not included as exhibits certain instruments with respect to
 our long-term debt, the amount of debt authorized under each of which does
 not exceed 10% of out total assets, and we agree to furnish a copy of any such
 instrument to the Securities and Exchange Commission upon request.</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">4.</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Material Contracts</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">6.</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Computation of Earnings per Share</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">7.</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Calculation of Ratio of Earnings to Fixed Charges</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Subsidiaries</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">12.1</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Certification of Chief Executive Officer required by Rule 13a-14(a) of
 the Exchange Act </p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">12.2</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Certification of the Principal Financial Officer required by Rule
 13a-14(a) of the Exchange Act</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">13.1</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Certification of Chief
 Executive Officer required by Rule 13a-14(b) of the Exchange Act</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">13.2</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Certification of the
 Principal Financial Officer required by Rule 13a-14(b) of the Exchange Act</p>
 </td>
 </tr>
</table></center></div>

<br clear=all
style='page-break-before:always'>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal' style="margin-top:0;margin-bottom:0">SIGNATURE</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-align:justify;text-indent:.5in' style="margin-top:0;margin-bottom:0">The registrant hereby certifies that it meets all of
the requirements for filing on Form 20-F and that it has duly caused and
authorized the undersigned to sign this annual report on its behalf.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align=right>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  colspan=3 valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">PHILIPPINE LONG DISTANCE TELEPHONE COMPANY</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-right:.8pt' style="margin-top:0;margin-bottom:0">By:</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">                /s/
 Ma. Lourdes C. Rausa-Chan</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">MA. LOURDES C. RAUSA-CHAN</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:.1in;text-align:center' style="margin-top:0;margin-bottom:0">Senior Vice President, Corporate Affairs and Legal</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Services Head and Corporate Secretary</p>
 </td>
 </tr>
</table></center></div>

</div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Date:  June 27, 2007</p>

<b><br clear=all style='page-break-before:always'>
</b>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><a name="_Toc170286208"></a><a
name="_Toc75779267"></a><a name="_Toc67395411">EXHIBIT
INDEX</a></h1>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:auto' style="margin-top:0;margin-bottom:0"><a name="_Toc46082326">Exhibit<br>
 Number</a></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:45.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Description of Exhibit</b></p>
 </td>
 </tr>

 <tr>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">1(a)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Articles of Incorporation
 (incorporated by reference to PLDT&#146;s Form 20-F as filed with the Securities
 and Exchange Commission in May 2001)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">1(b)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">By-Laws (as amended on June
 28, 2005) (incorporated by reference to PLDT&#146;s Form 20-F as filed with the
 Securities and Exchange Commission in June 2006)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">We have not included as
 exhibits certain instruments with respect to our long-term debt, the amount
 of debt authorized under each of which does not exceed 10% of out total
 assets, and we agree to furnish a copy of any such instrument to the
 Securities and Exchange Commission upon request.</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">4(a)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Stock Purchase and Strategic
 Investment Agreement, dated September 28, 1999, by and among PLDT, First
 Pacific Limited, Metro Pacific Corporation, Metro Pacific Asia Link Holdings,
 Inc., Metro Pacific Resources, Inc. and NTT Communications Corporation
 (incorporated by reference to PLDT&#146;s Form 6-K for the month of September
 1999)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">4(b)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Executive Stock Option Plan
 (incorporated by reference to PLDT&#146;s Form 20-F as filed with the Securities
 and Exchange Commission in May 2001)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">4(c)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Master Restructuring
 Agreement, dated June 21, 2000, as amended on December 12, 2000 and December
 19, 2000, between Piltel, Piltel (Cayman) Limited, PLDT, The Chase Manhattan
 Bank, as escrow agent, Metropolitan Bank and Trust Company, as administrative
 agent and the creditors named therein (incorporated by reference to PLDT&#146;s
 Form 20-F as filed with the Securities and Exchange Commission in May 2001)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">4(d)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">The Cooperation Agreement, dated January
 31, 2006, entered into by and among PLDT, First Pacific, Metro Pacific
 Corporation, Metro Asia Link Holdings, Inc., Metro Pacific Resources, Inc.,
 Larouge B.V., Metro Pacific Assets Holdings, Inc., NTT Communications and
 DoCoMo (incorporated by reference to Schedule 13D/A (Amendment No.2) as filed
 with the United States Securities and Exchange Commission by Nippon Telegraph
 and Telephone Corporation and NTT Communications Corporation on January 31,
 2006) </p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Computation of Earnings per
 Share</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Calculation of Ratio of
 Earnings to Fixed Charges </p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Subsidiaries </p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">12.1</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Certification of Chief
 Executive Officer required by Rule 13a-14(a) of the Exchange Act </p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">12.2</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Certification of the
 Principal Financial Officer required by Rule 13a-14(a) of the Exchange Act</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">13.1</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Certification of Chief
 Executive Officer required by Rule 13a-14(b) of the Exchange Act</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">13.2</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Certification of the
 Principal Financial Officer required by Rule 13a-14(b) of the Exchange Act</p>
 </td>
 </tr>
</table></center></div>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=right style='text-align:right;line-height:10.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=right style='text-align:right;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=right style='text-align:right;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br clear=all
style='page-break-before:always'>

<p align=right style='text-align:right;line-height:10.0pt' style="margin-top:0;margin-bottom:0"><b>EXHIBIT 6</b></p>

<p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">PHILIPPINE LONG DISTANCE
TELEPHONE COMPANY</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Computation
of Operating Income and Earnings Per Share</p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">For the years 2002
through 2006</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0 align=left
   style='width:100.0%;border-collapse:collapse;margin-left:6.75pt;
 margin-right:6.75pt'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b><b>(1)</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2003</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2002</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=8 valign=top style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> (in millions,
 except net operating income (loss) per common share)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1. Operating income per share</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.3in;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Operating income </p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php48,179</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$982</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php48,514</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php48,539</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php33,379</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php12,029</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Deduct:  Dividends on preferred stock</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">572</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,677</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,764</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,739</p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,645</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:49.5pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accretion of redemption value of
 preferred stock subject to mandatory conversion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">765</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,443</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,503</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,309</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.3in;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Operating income applicable to common
 shareholders</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php46,842</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$955</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php45,394</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php45,272</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php30,331</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,380</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.3in;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Operating income </p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php48,179</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$982</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php48,514</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php48,539</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php33,379</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php12,029</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Deduct:  Dividends on preferred stock</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">572</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">70</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,036</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:45.0pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accretion of redemption value of
 preferred stock subject to mandatory conversion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">765</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,746</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,309</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.3in;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Operating income applicable to common
 shareholders</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php46,842</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$955</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php46,698</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php48,490</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php32,021</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php9,989</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:31.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Weighted average number of common shares
 (in thousands)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:17.1pt;text-indent:9.9pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Outstanding common shares, beginning</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">180,789</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">170,214</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,476</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,361</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">168,895</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.3in;text-indent:5.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Effect of issuance of common shares
 during the year</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,667</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,855</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">200</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">184,456</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">172,069</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,728</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,413</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,095</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:31.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Weighted average number of common shares
 (in thousands)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:17.1pt;text-indent:9.9pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Outstanding common shares, beginning</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">180,789</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">170,214</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,476</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,361</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">168,895</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:27.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Effect of issuance of common shares during the year</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,667</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,855</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">200</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:27.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Weighted average number of shares under ESOP during
 the year(3)</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">94</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">155</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:27.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Common share equivalent of preferred shares deemed
 dilutive</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,858</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">22,381</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,222</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">22,160</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">184,456</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">183,021</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">192,264</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">193,635</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">191,255</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;
 height:6.75pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.2pt'>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:6.2pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Operating income per share </p>
 </td>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:6.2pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:6.2pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:6.2pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:6.2pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:6.2pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt;height:6.2pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php253.95</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php263.81</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php266.73</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php179.04</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php55.47</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">253.95</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">255.15</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:3.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">252.20</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">165.37</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">52.23</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=top style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>
 </td>
 <td   colspan=8 valign=top style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:5.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in millions, except
 earnings per common share)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2. Earnings per share</b><b>(2)</b></p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:31.5pt;text-indent:-.2in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income (loss) after cumulative
 effect of change in accounting policy</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php33,598</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$685</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php40,603</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php28,101</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php11,045</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php6,158)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:17.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Deduct:  Dividends on preferred stock </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">572</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,677</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,764</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,739</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,645</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:40.5pt;text-indent:-22.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">               Accretion to redemption
 value of preferred stock<br>
 subject to mandatory conversion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">765</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,443</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,503</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,309</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:17.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net income (loss) attributable  to common
 shareholders</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php32,261</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$660</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php37,483</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php24,834</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php7,997</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php8,807)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:31.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income (loss) after cumulative
 effect of change in accounting policy</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php33,598</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$685</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php40,603</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php28,101</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php11,045</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php6,158)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:17.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Deduct:  Dividends on preferred stock </p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">572</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">70</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">285</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,485</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,645</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:40.5pt;text-indent:-22.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">               Accretion to redemption
 value of preferred stock<br>
 subject to mandatory conversion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">765</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">14</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,746</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,503</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,309</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:5.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net income (loss) applicable to common
 shareholders</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php32,261</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$660</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php38,787</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php26,313</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php8,251</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php8,807)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:12.6pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:31.5pt;text-indent:-13.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Weighted average number of common shares
 (in thousands)</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:17.1pt;text-indent:9.9pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Outstanding common shares, beginning</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">180,789</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">170,214</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,476</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,361</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">168,895</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:.3in;text-indent:5.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Effect of issuance of common shares
 during the year</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,667</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,855</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">200</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">184,456</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">172,069</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,728</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,413</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,095</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Weighted average number of common shares (in
 thousands)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#D9D9D9;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:27.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Outstanding common shares, beginning</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">180,789</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">170,214</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,476</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,361</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">168,895</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:27.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Effect of issuance of common shares during the year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,667</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,855</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">200</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:27.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Weighted average number of shares under ESOP during
 the year(3)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">94</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">155</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:27.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Common share equivalent of preferred shares deemed
 dilutive:</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,858</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,213</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,069</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='text-indent:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">184,456</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">183,021</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">181,096</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">180,482</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">169,095</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Earnings per share(2) </p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.7pt'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:11.7pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:11.7pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php174.90</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:11.7pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:11.7pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php217.84</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:11.7pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php146.32</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:11.7pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php47.20</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt;height:11.7pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Php52.08)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">174.90</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">211.93</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">145.30</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style=';text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">45.72</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(52.08)</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:normal;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>(1)    PLDT Group maintains its accounts in Philippine
peso.  For convenience, the peso financial information as at and for the year
ended December 31, 2006 has been translated into U.S. dollars at the exchange
rate of Php49.045 to US$1.00, the peso-dollar rate as quoted through the
Philippine Dealing System as at December 31, 2006.</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:13.7pt;text-indent:-13.7pt' style="margin-top:0;margin-bottom:0"><i>(2)    Our convertible preferred stocks were deemed
anti-dilutive for the years ended December 31, 2002 and 2006.   Since the
amount of preferred dividends over the equivalent number of common stocks were
greater than the basic earnings per share, the amounts reported for the years
ended December 31, 2002 and 2006  basic and diluted earnings per common share
were the same.</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>(3)    The dilutive effect of the outstanding options
is reflected as additional share dilution in the computation of earnings per
common share, see Note 20 &#150; Earnings per Common Share </i><i>to the accompanying consolidated financial statements
in Item 18 for further discussion.  </i></p>

<p style='text-indent:5.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>EXHIBIT 7</b></p>

<p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPHONE COMPANY</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Calculation of Ratio of Earnings to Fixed Charges</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">For the years 2002 through
2006</p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:91.36%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:white;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:white;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 background:white;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b><b>(1)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 background:white;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:white;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:white;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2003</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 background:white;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2002</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:white;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=6 valign=top style=' background:white;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:.05in;text-align:center' style="margin-top:0;margin-bottom:0"><b>(in millions, except ratio of earnings (loss) to
 fixed charges)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:white;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:white;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:white;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:white;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:white;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:white;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:white;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">Earnings (a)</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php52,763</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">US$1,076</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php57,972</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php49,155</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php24,168</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php11,320</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Fixed charges &#150; (b)</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt' style="margin-top:0;margin-bottom:0">Fixed
 charges excluding amortization of capitalized interest</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php7,445</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">US$152</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php10,759</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php12,805</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php12,747</p>
 </td>
 <td   valign=bottom style=' background:#D9D9D9;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php14,177</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.0pt'>
 <p style='margin-left:8.1pt' style="margin-top:0;margin-bottom:0">Capitalized
 interest, net of amortization</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(941)</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.0pt'>
 <p align=right style='margin-right:1.45pt;text-align:right' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(939)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">(915)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.0pt'>
 <p align=right style='margin-right:2.15pt;text-align:right' style="margin-top:0;margin-bottom:0">(714)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:9.0pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">(394)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php6,504</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">133</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php9,820</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">Php11,890</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php12,033</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#D9D9D9;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php13,783</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Ratio (a/b) (2)</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">8.1</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">8.1</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5.9</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.75pt;text-align:right' style="margin-top:0;margin-bottom:0">4.1</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2.0</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">_____________</p>

<p style='line-height:50%' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0"><i>(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>PLDT Group maintains its
accounts in Philippine peso.  For convenience, the peso financial information
as at and for the year ended December 31, 2006 has been translated into U.S.
dollars at the exchange rate of Php49.045 to US$1.00, the peso-dollar rate as
quoted through the Philippine Dealing System as at December 31, 2006.</i></p>

<p style='line-height:50%' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;text-indent:-.25in;line-height:
9.0pt' style="margin-top:0;margin-bottom:0"><i>(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</i><i>For purposes of this ratio,
&#147;Earnings&#148; consist of income before provision for income tax (excluding PLDT&#146;s
share in undistributed income of less than 50%-owned affiliates) and fixed
charges (excluding capitalized interest).
&#147;Fixed charges&#148; consist of interest (including capitalized interest, discounts
and other financing costs) on all indebtedness, amortization of deferred
financing costs and the estimated financing component of rent expense (i.e.,
one-third of rent expense).</i></p>

<p style='line-height:9.0pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.25in;line-height:9.0pt' style="margin-top:0;margin-bottom:0"><i>Due to PLDT&#146;s net loss in 2002, the coverage ratio on a
consolidated basis was less than 1.0x.  In order to achieve a coverage ratio of
1.0x in that year, we would have had to generate additional consolidated
earnings of Php2,463 million for the year ended December 31, 2002.</i></p>

<p style='line-height:50%' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<b><i><br
clear=all style='page-break-before:always'>
</i></b>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>EXHIBIT 8</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>PLDT SUBSIDIARIES</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:92.94%;margin-left:.25in;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:8.4pt'>
 <td   rowspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Name of Subsidiary</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.4pt'>
 <p align=center style='margin-top:3.0pt;margin-right:0in;
 margin-bottom:0in;margin-left:1.45pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Place of Incorporation</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.4pt'>
 <p align=center style='margin-top:3.0pt;margin-right:0in;
 margin-bottom:0in;margin-left:1.45pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Principal Activity</b></p>
 </td>
 <td   colspan=2 valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.4pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Percentage of Ownership</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Direct</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Indirect</b></p>
 </td>
 </tr>

 <tr style='height:5.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p style='margin-left:1.45pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p style='margin-left:1.45pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:5.0pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   colspan=5 valign=bottom style=' padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:.1in;margin-bottom:
 1.0pt;margin-left:0in' style="margin-top:0;margin-bottom:0"><b>Wireless</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Smart</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Cellular mobile services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Smart
 Broadband </p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet broadband and distributor</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in' style="margin-top:0;margin-bottom:0">Wolfpac </p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Mobile applications developer and <br>
 service provider</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Providing cellular and fixed line services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">92.1</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Telesat</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite communications services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">94.4</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ACeS Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite phone services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">88.5</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">11.5</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Mabuhay Satellite</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite communications services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">67.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   colspan=5 valign=bottom style=' padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:0in' style="margin-top:0;margin-bottom:0"><b>Fixed Line</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ClarkTel</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">SubicTel</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications
 services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">PLDT
 Global</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">British Virgin Islands</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications
 services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">SNMI</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Data
 and network services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Maratel</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications
 services</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">97.5</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">BCC</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications,
 infrastructure <br>
 and related value-added services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">75.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   colspan=5 valign=bottom style=' padding:0in 0in 0in 0in;
 height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:0in' style="margin-top:0;margin-bottom:0"><b>Information and
 Communications Technology</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ePLDT</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Information
 and communications infrastructure for internet-based services, e-commerce,
 call centers <br>
 and IT-related services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Vocativ</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Call
 center services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Parlance</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Call
 center services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Ventus</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Call
 center services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">SPi
 and Subsidiaries (including CyMed)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Business
 process outsourcing, or BPO, services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Infocom</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet
 services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">99.6</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">netGames</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Publisher
 of online games</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">80.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Digital
 Paradise (formerly Netopia Computer Technologies, Inc.)</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet
 access services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">75.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Level
 Up!</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Publisher
 of online games</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">60.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Digital
 Paradise Thailand</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Thailand</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet
 access services</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">51.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Airborne
 Access</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Wireless
 internet services</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:8.65pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">51.0</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-top:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br
clear=all style='page-break-before:always'>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>Exhibit 12.1</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0"><a name="_Toc170286209"></a><a
name="_Toc75779268">CERTIFICATION</a></h1>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:0in;line-height:normal' style="margin-top:0;margin-bottom:0">I, Napoleon L. Nazareno, certify that:</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
I have reviewed this annual report
on Form 20-F of Philippine Long Distance Telephone Company;</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Based on my knowledge, this report
does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with
respect to the period covered by this report;</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Based on my knowledge, the
financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of
operations and cash flows of the Company as of, and for, the periods presented
in this report;</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s other certifying
officer(s) and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for
the Company and have:</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(a)&nbsp;&nbsp;&nbsp;&nbsp;
Designed such disclosure controls
and procedures, or caused such disclosure controls and procedures to be
designed under our supervision, to ensure that material information relating to
the Company, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this
report is being prepared;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(b)&nbsp;&nbsp;&nbsp;&nbsp;
Designed such internal control
over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally
accepted accounting principles;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(c)&nbsp;&nbsp;&nbsp;&nbsp;
Evaluated the effectiveness of the
Company&#146;s disclosure controls and procedures and presented in this report our
conclusions about the effectiveness of the disclosure controls and procedures,
as of the end of the period covered by this report based on such evaluation; and</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(d)&nbsp;&nbsp;&nbsp;&nbsp;
Disclosed in this report any
change in the Company&#146;s internal control over financial reporting that occurred
during the period covered by the annual report that has materially affected, or
is reasonably likely to materially affect, the Company&#146;s internal control over
financial reporting; and</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s other certifying
officer(s) and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the Company&#146;s auditors and the
audit committee of the Company&#146;s board of directors (or persons performing the
equivalent functions):</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(a)&nbsp;&nbsp;&nbsp;&nbsp;
All significant deficiencies and
material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the Company&#146;s
ability to record, process, summarize and report financial information; and</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:7.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(b)&nbsp;&nbsp;&nbsp;&nbsp;
Any fraud, whether or not
material, that involves management or other employees who have a significant
role in the Company&#146;s internal control over financial reporting.</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">Date:  June 27, 2007</p>

<p style='margin-left:.5in;text-indent:-.25in;line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:288.9pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-right:.05in;text-align:center' style="margin-top:0;margin-bottom:0">/s/  Napoleon L. Nazareno</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Napoleon L. Nazareno</p>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">President and Chief Executive Officer</p>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Principal Executive Officer)</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<b><br clear=all
style='page-break-before:always'>
</b>

<p style='margin-left:22.3pt;text-indent:355.7pt' style="margin-top:0;margin-bottom:0"><b>Exhibit 12.2</b></p>

<p align=center style='margin-left:22.3pt;text-align:center;
text-indent:-22.3pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='margin-left:22.3pt;text-align:center;
text-indent:-22.3pt' style="margin-top:0;margin-bottom:0"><b>CERTIFICATION</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:12.0pt' style="margin-top:0;margin-bottom:0">I,
Anabelle L. Chua, certify that:</p>

<p style='margin-left:.75in;text-indent:-.5in' style="margin-top:0;margin-bottom:0">1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
I have reviewed this annual report
on Form 20-F of Philippine Long Distance Telephone Company;</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Based on my knowledge, this report
does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with
respect to the period covered by this report;</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Based on my knowledge, the
financial statements, and other financial information included in this report,
fairly present in all material respects the financial condition, results of
operations and cash flows of the Company as of, and for, the periods presented
in this report;</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s other certifying
officer(s) and I are responsible for establishing and maintaining disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Company and have:</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(a)   Designed such disclosure controls and
procedures, or caused such disclosure controls and procedures to be designed
under our supervision, to ensure that material information relating to the
Company, including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this report is
being prepared;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(b)   Designed such internal control over financial
reporting, or caused such internal control over financial reporting to be
designed under our supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting
principles; </p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(c)   Evaluated the effectiveness of the Company&#146;s
disclosure controls and procedures and presented in this report our conclusions
about the effectiveness of the disclosure controls and procedures, as of the
end of the period covered by this report based on such evaluation; and</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(d)   Disclosed in this report any change in the
Company&#146;s internal control over financial reporting that occurred during the
period covered by the annual report that has materially affected, or is
reasonably likely to materially affect, the Company&#146;s internal control over
financial reporting; and</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Company&#146;s other certifying
officer(s) and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the Company&#146;s auditors and the
audit committee of the Company&#146;s board of directors (or persons performing the
equivalent functions):</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(a)   All significant deficiencies and material
weaknesses in the design or operation of internal control over financial
reporting which are reasonably likely to adversely affect the Company&#146;s ability
to record, process, summarize and report financial information; and</p>

<p style='line-height:8.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">(b)   Any fraud, whether or not material, that
involves management or other employees who have a significant role in the
Company&#146;s internal control over financial reporting.</p>

<p style='line-height:10.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Date:
June 27, 2007</p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:297.9pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">/s/  Anabelle L. Chua</p>
 </td>
 </tr>
 <tr style='height:38.65pt'>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 height:38.65pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Anabelle L. Chua</p>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Senior Vice President and Treasurer</p>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Principal Financial Officer)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:382.5pt' style="margin-top:0;margin-bottom:0"><a name=node35></a><b>&nbsp;</b></p>

<b><br clear=all
style='page-break-before:always'>
</b>

<p style='text-indent:5.25in' style="margin-top:0;margin-bottom:0"><b>Exhibit
13.1</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='margin-left:22.5pt;text-align:center;
text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>CERTIFICATION</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=left style='margin-right:.25in;text-align:left;
text-indent:27.0pt' style="margin-top:0;margin-bottom:0">Pursuant to 18 U.S.C. &#167;
1350, I, Napoleon L. Nazareno, President and Chief Executive Officer of
Philippine Long Distance Telephone Company, hereby certify, to my knowledge,
that our annual report on Form 20-F for the year ended December 31, 2006 (the
&#147;Report&#148;) fully complies with the requirements of Section 13(a) or 15(d), as
applicable, of the Securities Exchange Act of 1934, and that the information
contained in the Report fairly presents, in all material respects, our
financial condition and results of operations.</p>

<p align=left style='text-align:left;text-indent:24.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:24.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">Date:  June 27, 2007</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:31.9pt;border-collapse:collapse'>
 <tr>
 <td  valign=bottom style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">/s/  Napoleon L. Nazareno</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Napoleon L. Nazareno</p>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">President and Chief Executive Officer</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(Principal Executive Officer)</p>
 </td>
 </tr>
</table></center></div>

<p align=left style='margin-top:24.0pt;text-align:left;
text-indent:27.0pt' style="margin-top:0;margin-bottom:0">The foregoing
certification is being furnished solely pursuant to 18 U.S.C. &#167; 1350 and is not
being filed as part of the Report or as a separate disclosure document.</p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"> </p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br
clear=all style='page-break-before:always'>

<p style='margin-left:22.5pt;text-indent:346.5pt' style="margin-top:0;margin-bottom:0"><b>Exhibit 13.2</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='margin-left:22.5pt;text-align:center;
text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>CERTIFICATION</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:22.5pt;text-indent:-22.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=left style='margin-right:27.0pt;text-align:left;
text-indent:27.0pt' style="margin-top:0;margin-bottom:0">Pursuant to 18 U.S.C. &#167;
1350, I, Anabelle L. Chua, Senior Vice President and Treasurer of Philippine
Long Distance Telephone Company, hereby certify, to my knowledge, that our
annual report on Form 20-F for the year ended December 31, 2006 (the &#147;Report&#148;)
fully complies with the requirements of Section 13(a) or 15(d), as applicable,
of the Securities Exchange Act of 1934, and that the information contained in
the Report fairly presents, in all material respects, our financial condition
and results of operations.</p>

<p align=left style='text-align:left;text-indent:24.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:24.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">Date:  June 27, 2007</p>

<p align=left style='text-align:left;text-indent:24.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:24.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
 <td  valign=bottom style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">/s/  Anabelle L. Chua</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border:none;padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Anabelle L. Chua</p>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Senior Vice President and Treasurer</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' padding:2.9pt 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">(Principal Financial Officer)</p>
 </td>
 </tr>
</table></center></div>

<p align=left style='margin-top:24.0pt;text-align:left;
text-indent:27.0pt' style="margin-top:0;margin-bottom:0">The foregoing
certification is being furnished solely pursuant to 18 U.S.C. &#167; 1350 and is not
being filed as part of the Report or as a separate disclosure document.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<b><br clear=all
style='page-break-before:always'>
</b>

<p style=';text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style=';text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style=';text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style=';text-align:justify' style="margin-top:0;margin-bottom:0">Report of Independent Registered Public Accounting
Firm</p>

<p align=left style=';text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style=';text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style=';text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-align:justify;line-height:normal' style="margin-top:0;margin-bottom:0">The Board of Directors and the
Stockholders </p>

<p style='text-align:justify;line-height:normal' style="margin-top:0;margin-bottom:0">Philippine Long Distance Telephone
Company</p>

<p style='text-align:justify;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-align:justify;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;line-height:normal' style="margin-top:0;margin-bottom:0">We have audited management&#146;s assessment, included in
the accompanying Management&#146;s Report on Internal Control over Financial
Reporting, that Philippine Long Distance Telephone Company and Subsidiaries
(&#147;the Company&#148;) maintained effective internal control over financial reporting
as of December 31, 2006, based on criteria established in Internal Control -
Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (the COSO criteria).  The Company&#146;s management is
responsible for maintaining effective internal control over financial reporting
and for its assessment of the effectiveness of internal control over financial
reporting.  Our responsibility is to express an opinion on management&#146;s
assessment and an opinion on the effectiveness of the Company&#146;s internal
control over financial reporting based on our audit. </p>

<p style='line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;line-height:normal' style="margin-top:0;margin-bottom:0">We conducted our audit in accordance with the
standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether effective internal control over financial reporting was
maintained in all material respects.  Our audit included obtaining an
understanding of internal control over financial reporting, evaluating
management&#146;s assessment, testing and evaluating the design and operating
effectiveness of internal control, and performing such other procedures as we
considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion.</p>

<p style='line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;line-height:normal' style="margin-top:0;margin-bottom:0">A company&#146;s internal control over financial reporting
is a process designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles.  A
company&#146;s internal control over financial reporting includes those policies and
procedures that (1) pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the
assets of the company; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with
authorizations of management and directors of the company; and (3) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company&#146;s assets that could have a
material effect on the financial statements.</p>

<p style='line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Because of its inherent limitations, internal control over
financial reporting may not prevent or detect misstatements.  Also, projections
of any evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions, or that
the degree of compliance with the policies or procedures may deteriorate.</p>

<p style='line-height:normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">In our opinion, management&#146;s assessment that the Company
maintained effective internal control over financial reporting as of December
31, 2006, is fairly stated, in all material respects, based on the COSO
criteria.  Also, in our opinion, the Company maintained, in all material
respects, effective internal control over financial reporting as of December
31, 2006, based on<b> </b>the COSO criteria<b>.</b></p>

<p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">We also have audited, in
accordance with the standards of the Public Company Accounting Oversight Board
(United States), the consolidated balance sheets of the Company as of December
31, 2006 and 2005, and the related consolidated statements of income, changes
in stockholders&#146; equity and cash flows for each of the three years in the
period ended December 31, 2006, and our report dated June 25, 2007 expressed an
unqualified opinion thereon.</p>

<p style='line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><u>/s/Sycip Gorres Velayo &amp; Co.______</u></p>

<p style="margin-top:0;margin-bottom:0">SYCIP, GORRES, VELAYO &amp; CO.</p>

<p style='' style="margin-top:0;margin-bottom:0">Makati City, Philippines</p>

<p style='' style="margin-top:0;margin-bottom:0">June 25, 2007</p>

</div>

<br clear=all
style='page-break-before:always'>

<div>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0"><b>Report of Independent Registered Public
Accounting Firm </b></p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:12.25pt;
margin-bottom:.0001pt;text-indent:-12.25pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:12.25pt;
margin-bottom:.0001pt;text-indent:-12.25pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:12.25pt;
margin-bottom:.0001pt;text-indent:-12.25pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:12.25pt;
margin-bottom:.0001pt;text-indent:-12.25pt' style="margin-top:0;margin-bottom:0">The Board of Directors and Stockholders </p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:12.25pt;
margin-bottom:.0001pt;text-indent:-12.25pt' style="margin-top:0;margin-bottom:0">Philippine Long Distance Telephone Company</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:12.25pt;
margin-bottom:.0001pt;text-indent:-12.25pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:12.25pt;
margin-bottom:.0001pt;text-indent:-12.25pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We have audited the accompanying consolidated
balance sheets of Philippine Long Distance Telephone Company and subsidiaries
as of December 31, 2006 and 2005, and the related consolidated statements of
income, stockholders&#146; equity, and cash flows for each of the three years in the
period ended December 31, 2006.  These financial statements are the
responsibility of the Company&#146;s management.  Our responsibility is to express
an opinion on these financial statements based on our audits.</p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We conducted our audits in accordance with the
standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements.  An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation.  We believe that our audits provide a reasonable basis for
our opinion.</p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In our opinion, the financial statements
referred to above present fairly, in all material respects, the consolidated
financial position of Philippine Long Distance Telephone Company and
subsidiaries as of December&nbsp;31, 2006 and 2005, and the consolidated
results of their operations and their cash flows for each of the three years in
the period ended December 31, 2006, in conformity with U.S. generally accepted
accounting principles.</p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">As discussed in Note 2 to the consolidated
financial statements, the Company changed its method of accounting for
share-based payments in accordance with the provisions of Statement of
Financial Accounting Standards No. 123 (revised 2004) beginning January&nbsp;1,
2006.  Also, as discussed in Note&nbsp;2 to the
consolidated financial statements, effective December&nbsp;31, 2006, the
Company adopted the provisions of Statement of Financial Accounting Standards
No.&nbsp;158, <i>Employers&#146; Accounting for Defined Benefit Pension and Other
Postretirement Plans&nbsp;&#151; an amendment of FASB Statements No.&nbsp;87, 88,
106, and 132(R)</i>.</p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">We also have audited, in accordance with the
standards of the Public Company Accounting Oversight Board (United States), the
effectiveness of Philippine Long Distance Telephone Company&#146;s internal control
over financial reporting as of December 31, 2006, based on criteria established
in<i> Internal Control - Integrated Framework</i> issued by the Committee of
Sponsoring Organizations of the Treadway Commission and our report dated June
25, 2007 expressed an unqualified opinion thereon. </p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:12.25pt;
margin-bottom:.0001pt;text-indent:-12.25pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><u>/s/Sycip Gorres Velayo &amp; Co.______</u></p>

<p style="margin-top:0;margin-bottom:0">SYCIP, GORRES, VELAYO &amp; CO.</p>

<p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:12.25pt;
margin-bottom:.0001pt;text-indent:-12.25pt' style="margin-top:0;margin-bottom:0">Makati City, Philippines</p>

<p style="margin-top:0;margin-bottom:0">June 25, 2007 </p>

</div>

<br clear=all style='page-break-before:always'>

<div>

<p style='margin-left:.2in;text-indent:-.2in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPHONE COMPANY <br>
AND SUBSIDIARIES</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>CONSOLIDATED FINANCIAL STATEMENTS</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">AS AT DECEMBER 31,
2006 AND 2005</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">AND FOR THE THREE
YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">AND</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<br clear=all
style='page-break-before:always'>

<p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE
TELEPHONE COMPANY AND SUBSIDIARIES</b></p>

<p align=center style=';text-align:center;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>CONSOLIDATED
BALANCE SHEETS</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>DECEMBER
31, 2006 AND 2005</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in
million pesos, except par value and share amounts)</b></p>

<p align=center style=';text-align:center;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=center style=';text-align:center;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.26%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   colspan=3 valign=bottom style=' border:none;
 border-top:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=center style='margin-top:6.0pt;;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>ASSETS</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.6pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p style='margin-top:4.0pt' style="margin-top:0;margin-bottom:0"><b>Current Assets</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-top:4.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-top:4.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Cash and cash equivalents (Notes 4 and 23)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,870</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">30,059</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Short-term investments (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>8,327</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">2,750</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Trade and other receivables - net (Notes 5 and 23) </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,158</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">7,856</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Inventories and supplies - net (Note 6)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,230</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">1,548</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Deferred income tax assets - net (Note 19)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,042</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">9,866</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Derivative assets (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>47</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Prepaid expenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,293</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">5,001</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Other current assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>383</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">1,539</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total Current Assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>52,350</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">58,656</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.2pt'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:13.2pt'>
 <p style='margin-top:4.0pt' style="margin-top:0;margin-bottom:0"><b>Noncurrent Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.2pt'>
 <p align=right style='margin-top:4.0pt;margin-right:13.7pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:13.2pt'>
 <p align=right style='margin-top:4.0pt;margin-right:13.7pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.25pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.25pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Property, plant and equipment - net (Note 7)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>164,081</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.25pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">173,007</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Investments - net (Note 8)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>637</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">361</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Investments-available-for-sale (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>116</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Goodwill and other intangible assets - net (Note 9)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>27,241</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">16,875</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Deferred income tax assets - net (Note 19)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,706</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">13,589</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Derivative assets (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>434</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Other noncurrent assets - net (Note 10)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,630</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">4,464</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total Noncurrent Assets</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>211,845</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">211,053</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.0pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:6.0pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 Assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:6.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>264,195</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:6.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">269,709</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.1pt'>
 <p align=center style='margin-top:6.0pt;margin-right:13.45pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>LIABILITIES AND STOCKHOLDERS&#146; EQUITY</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:4.0pt' style="margin-top:0;margin-bottom:0"><b>Current
 Liabilities</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:4.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:4.0pt;margin-right:.05in;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Accounts payable (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>8,347</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">15,966</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-18.4pt' style="margin-top:0;margin-bottom:0">Accrued expenses and other current liabilities (Notes
 8, 11, 16, 17, 21, 22 and 23)<br>
 (Due to related parties amounted to Php4,120 and Php3,711 in 2006 and 2005,
 respectively)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>23,524</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">15,986</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Unearned revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,019</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">3,125</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Derivative liabilities (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>108</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Deferred income tax
 liabilities (Note 19)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Current portion of
 interest-bearing financial liabilities (Notes 7, 12, 21 and 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>17,441</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">19,550</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p style="margin-top:0;margin-bottom:0">Dividends payable
 (Notes 20 and 23)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>777</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">746</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Income tax payable (Note 19)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,438</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">2,080</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total Current Liabilities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>56,654</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">57,650</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.25pt'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.25pt'>
 <p style='margin-top:4.0pt' style="margin-top:0;margin-bottom:0"><b>Noncurrent Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.25pt'>
 <p align=right style='margin-top:4.0pt;margin-right:13.7pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:8.25pt'>
 <p align=right style='margin-top:4.0pt;margin-right:13.7pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Interest-bearing financial liabilities - net of
 current portion (Notes 7, 12, 21 and 23)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>69,648</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">93,860</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 liabilities (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>6,872</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">5,777</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Deferred income tax liabilities (Note 19)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>382</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Pension and other employee benefits (Note 17)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>7,627</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">3,943</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Customers&#146; deposits</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,204</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">2,214</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Remaining excess of debt forgiven over value of
 consideration given - net (Notes 12 and 14)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,688</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">5,071</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Deferred credits and other noncurrent liabilities
 (Notes 13 and 21)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>8,532</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">8,421</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:10.0pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total Noncurrent Liabilities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>97,953</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">119,330</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.85pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 11.85pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Minority Interest in Consolidated Subsidiaries</b> </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 11.85pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,041</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 11.85pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">1,130</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Preferred Stock Subject to Mandatory Redemption </b>(Notes 14 and 23)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,374</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">12,004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:10.0pt'>
 <p style='margin-top:4.0pt;margin-right:0in;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Stockholders&#146; Equity</b> (Notes 15 and 20)</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-top:4.0pt;margin-right:13.7pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-top:4.0pt;margin-right:13.7pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Preferred stock, Php10 par value, authorized -
 822,500,000 shares: </p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">Series
 A to GG (issued and outstanding - 406,375,057 shares as at December 31, 2006 and<br>
 407,343,035 shares as at December 31, 2005</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,064</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">4,073</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">Series
 IV (issued and outstanding - 36,000,000 shares)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>360</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">360</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p style='margin-left:18.4pt;text-indent:-18.4pt' style="margin-top:0;margin-bottom:0">Common stock, Php5 par value, authorized -
 234,000,000 shares; issued and outstanding - 188,434,695 shares<br>
 as at December 31, 2006 and 180,789,003 shares as at December 31, 2005</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>942</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">904</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Capital in excess of par value</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>91,479</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">78,873</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Retained earnings (deficit) (Note 20)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>12,498</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.0pt'>
 <p align=right style='margin-top:0in;margin-right:.15in;
 margin-bottom:0in;margin-left:12.95pt;margin-bottom:.0001pt;text-align:right;
 text-indent:-12.95pt' style="margin-top:0;margin-bottom:0">(5,288)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Accumulated other comprehensive income (loss)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.0pt'>
 <p align=right style='margin-top:0in;margin-right:.15in;
 margin-bottom:0in;margin-left:12.95pt;margin-bottom:.0001pt;text-align:right;
 text-indent:-12.95pt' style="margin-top:0;margin-bottom:0"><b>(3,170)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">673</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.0pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 10.0pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 Stockholders&#146; Equity</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>106,173</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 10.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">79,595</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.0pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:6.0pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 Liabilities and Stockholders&#146; Equity</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:6.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>264,195</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:6.0pt'>
 <p align=right style='margin-right:13.7pt;text-align:right' style="margin-top:0;margin-bottom:0">269,709</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0">See
accompanying Notes to Consolidated Financial Statements.</p>

<b><br clear=all
style='page-break-before:always'>
</b>

<p align=center style=';text-align:center;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG
DISTANCE TELEPHONE COMPANY AND SUBSIDIARIES</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">CONSOLIDATED
STATEMENTS OF INCOME</h1>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in million pesos, except per share amounts)</b></p>

<p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.8%;margin-left:.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:9.75pt'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;height:9.75pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.75pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.75pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.75pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.1pt'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:7.1pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>OPERATING REVENUES </b>(Notes 18
 and 24)</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.1pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.1pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:7.1pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.75pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.75pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Service revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.75pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>125,004</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.75pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">120,348</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.75pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">114,904</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.3pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.3pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Non-service revenues</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.3pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,532</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.3pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,987</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.3pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,269</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.75pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.75pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.75pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>127,536</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.75pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">123,335</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:9.75pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">121,173</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>OPERATING EXPENSES </b>(Note 18)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Depreciation
 and amortization (Notes 7 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>28,130</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">27,855</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,098</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Compensation and employee benefits (Notes 17 and 18)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>18,267</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,852</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,016</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Repairs and maintenance (Note 16)<br>
 (Total transactions with related parties amounted to Php18, Php640 and Php111
 in 2006, <br>
 2005 and 2004, respectively)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,565</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,705</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,671</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost
 of computers, cellular handsets, SIM-packs sold and point-product sales</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,323</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,180</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,599</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Selling and promotions (Note 16)<br>
 (Total transactions with related parties amounted to Php23, Php29 and Php32
 in 2006, <br>
 2005 and 2004, respectively)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,010</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,768</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,708</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Professional and other contracted
 services (Notes 16 and 18)<br>
 (Total transactions with related parties amounted to Php725, Php147 and
 Php694 in 2006, <br>
 2005 and 2004, respectively)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,144</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,432</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,187</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Rent (Note 16)<br>
 (Total transactions with related parties amounted to Php10, Php8 and Php6 in
 2006 and 2005<br>
 and 2004, respectively)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,257</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,086</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,160</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Asset impairment (Notes 7, 8, 18 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,799</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,412</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Taxes and licenses (Notes 16 and 22) <br>
 (Total transactions with related parties amounted to Php53 in 2006)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,815</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,516</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,055</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communication,
 training and travel</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,480</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,465</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,310</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.0pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Insurance and security services (Note
 16)<br>
 (Total transactions with related parties amounted to Php360, Php467 and
 Php534 in 2006, <br>
 2005 and 2004, respectively)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.0pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,255</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.0pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,523</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.0pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,644</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision
 for doubtful accounts (Notes 5 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>736</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,251</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,955</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Cost of satellite air time (All are
 transactions with related parties) (Notes 16 and 21) </p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>698</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,008</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,299</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.3pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.3pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Amortization of intangible assets (Note 9)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.3pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>402</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.3pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">204</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:6.3pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision
 for inventory obsolescence (Notes 6 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>211</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">479</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">577</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other operating expenses </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,265</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,486</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,850</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>79,357</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">74,821</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">72,634</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">OPERATING
 INCOME</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>48,179</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48,514</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48,539</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>FINANCING COSTS </b> (Notes 18
 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(2,459)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,423)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(16,233)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>INTEREST INCOME</b> (Note 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,422</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,457</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">942</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>EQUITY SHARE IN NET INCOME (LOSS) OF ASSOCIATES</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(52)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(74)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>LOSS</b><b> ON</b><b> DERIVATIVE TRANSACTIONS &#150; </b>net (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(6,857)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,801)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(864)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>OTHER INCOME </b>&#150; net (Note 18)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,595</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,016</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,530</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.25pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.25pt'>
 <p style='margin-top:0in;margin-right:0in;margin-bottom:
 0in;margin-left:9.0pt;margin-bottom:.0001pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">INCOME
 BEFORE INCOME TAX, CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING POLICY AND MINORITY INTEREST
 IN NET LOSS (INCOME) <br>
 OF CONSOLIDATED SUBSIDIARIES </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.25pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>43,828</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.25pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">45,770</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:3.25pt'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">34,840</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>PROVISION FOR INCOME TAX </b>(Notes
 19 and 24)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(9,046)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(4,849)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(6,826)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:7.1pt;text-indent:-7.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>INCOME BEFORE CUMULATIVE EFFECT OF
 CHANGE IN ACCOUNTING <br>
 POLICY AND MINORITY INTEREST IN NET LOSS (INCOME) OF CONSOLIDATED
 SUBSIDIARIES</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>34,782</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,921</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28,014</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:7.1pt;text-indent:-7.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>CUMULATIVE EFFECT ON PRIOR YEARS (UP
 TO DECEMBER 31, 2005) OF <br>
 ADOPTING SFAS NO. 123 (R), &#147;SHARE-BASED PAYMENT&#148; </b>&#150; net of tax effect (Note 3)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(189)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:7.1pt;text-indent:-7.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>INCOME BEFORE MINORITY INTEREST IN
 NET LOSS (INCOME) OF <br>
 CONSOLIDATED SUBSIDIARIES</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>34,593</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,921</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28,014</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:7.1pt;text-indent:-7.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>MINORITY INTEREST IN NET LOSS
 (INCOME) OF CONSOLIDATED SUBSIDIARIES</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(995)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(318)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">87</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>NET INCOME</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>33,598</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:7.1pt;text-indent:-7.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>DIVIDENDS, ACCRETION AND FOREIGN
 EXCHANGE REVALUATION <br>
 OF PREFERRED STOCK </b>(Note 20)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,337)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,120)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,267)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS </b>(Note 20)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>32,261</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">37,483</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,834</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Earnings Per Common Share </b>(Note
 20)</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.6pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Basic earnings per common share</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>174.90</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">217.84</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">146.32</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Diluted earnings per common share</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>174.90</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">211.93</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">145.30</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0"><i>See
accompanying Notes to Consolidated Financial Statements.</i></p>

<i><br clear=all
style='page-break-before:always'>
</i>

<p align=center style='margin-top:3.0pt;text-align:center;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG
DISTANCE TELEPHONE COMPANY AND SUBSIDIARIES</b></p>

<p align=center style='margin-top:3.0pt;margin-right:2.45pt;
margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>CONSOLIDATED
STATEMENTS OF CHANGES IN STOCKHOLDERS&#146; EQUITY</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>FOR THE YEARS
ENDED DECEMBER 31, 2006, 2005 AND 2004</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>(in million pesos)</b></p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:101.22%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:12.75pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.75pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.75pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Preferred<br>
 Stock</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.75pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Common<br>
 Stock</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.75pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Capital in <br>
 Excess of <br>
 Par Value</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.75pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Retained Earnings (Deficit)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.75pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Accumulated Other Comprehensive Income (Loss)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:12.75pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Total<br>
 Equity</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.1pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.1pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>Balances as at January 1, 2004</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,505</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>847</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>74,520</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(58,031)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.1pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,904</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>24,745</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.55pt'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:11.55pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Comprehensive income (loss):</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:11.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:11.55pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Net income for the year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Translation losses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">(2,168)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,168)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Net losses on available-for-sale financial assets
 (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.1pt'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.1pt'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">(199)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(199)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.95pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.95pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Net comprehensive income (loss)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.95pt'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">(2,372)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">25,729</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.7pt'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:8.7pt'>
 <p style='margin-left:14.6pt;text-indent:-14.6pt' style="margin-top:0;margin-bottom:0"><b>Cash dividends (Note 20)</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:8.7pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,764)</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:8.7pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.7pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,764)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:17.1pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:17.1pt'>
 <p style='margin-left:14.6pt;text-indent:-14.6pt' style="margin-top:0;margin-bottom:0"><b>Accretion to redemption value of preferred stock
 subject to mandatory redemption (Note
 20)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:17.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:17.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:17.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:17.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,503)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:17.1pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:17.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,503)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.1in'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 .1in'>
 <p style="margin-top:0;margin-bottom:0"><b>Issuance of capital stock
 - net (Note 15)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(8)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>876</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 872</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.8pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.8pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>Balances as at December 31, 2004</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,497</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 851</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>75,396</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.8pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(33,197)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.8pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b> 532</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:9.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>48,079</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Comprehensive income (loss):</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Net income for the year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Translation losses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">(63)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(63)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.1in'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Net gains on available-for-sale financial assets
 (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">   5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0">199</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 199</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.8pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.8pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Net comprehensive income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.8pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"> 141</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,744</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.95pt'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:10.95pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>Cash dividends</b><b> (Note 20)</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(11,251)</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(11,251)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.95pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0"><b>Accretion to redemption value of preferred stock
 subject to mandatory redemption (</b><b>Note
 20)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,443)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,443)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>Issuance of capital stock - net </b><b>(Note 15)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(64)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>53</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,477</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,466</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.1pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>Balances as at December 31, 2005</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,433</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 904</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>78,873</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(5,288)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b> 673</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>79,595</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Comprehensive income (loss):</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Net income for the year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">33,598</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">33,598</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.45pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Translation losses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">(535)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(535)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.1in'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-left:.25in;text-indent:-3.4pt' style="margin-top:0;margin-bottom:0">Net loss on available-for-sale financial assets (Note
 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:.1in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.8pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:7.8pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Net comprehensive income (loss)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">33,598</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:7.8pt'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">(540)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:7.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">33,058</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.95pt'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:10.95pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>Cash dividends</b><b> (Note 20)</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(15,047)</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.95pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(15,047)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>Unrecognized pension cost &#150; net (Note 17)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0"><b>(3,303)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(3,303)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.95pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p style='margin-left:13.9pt;text-indent:-13.9pt' style="margin-top:0;margin-bottom:0"><b>Accretion to redemption value of preferred stock
 subject to mandatory redemption (</b><b>Note
 20)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(765)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:13.95pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(765)</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>Issuance of capital stock - net </b><b>(Note 15)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(9)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>38</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>12,606</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:.25in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>12,635</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.1pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b>Balances as at December 31, 2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,424</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 942</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>91,479</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>12,498</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0"><b>(3,170)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>106,173</b></p>
 </td>
 </tr>
</table></center></div>

<p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0"><i>See
accompanying Notes to Consolidated Financial Statements.</i></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<b><br clear=all
style='page-break-before:always'>
</b>

<p align=center style=';text-align:center;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG
DISTANCE TELEPHONE COMPANY AND SUBSIDIARIES</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0" style="margin-top:0;margin-bottom:0">CONSOLIDATED STATEMENTS OF CASH FLOWS</h1>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>FOR
THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(in
million pesos)</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.38%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>CASH FLOWS FROM OPERATING ACTIVITIES</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net income </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>33,598</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Adjustments to reconcile net income to
 net cash provided by operating activities:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Depreciation and amortization (Notes 7
 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>28,130</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">27,855</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20,098</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Loss on derivative instruments (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6,857</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,801</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">864</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Asset impairment (Notes 7, 8, 18 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,799</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,412</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Minority interest in net income (loss)
 of consolidated subsidiaries</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>995</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">318</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(87)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts (Notes 5
 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>736</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,251</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,955</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Amortization of intangible assets (Note
 9)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>402</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">204</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accretion on financial liabilities (Note
 18)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>338</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">568</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,185</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Provision for inventory obsolescence
 (Notes 6 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>211</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">479</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">577</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Equity share in net loss (income) of
 associates</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>52</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">74</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(Gain) loss on disposal of property and equipment</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(195)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">160</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">155</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Benefit from deferred income tax
 including tax on cumulative cumulative
 effect of change in accounting policy
 (Note 3)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,082)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,734)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(531)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Gain on early settlement of debt, debt
 exchange and debt restructuring transactions<br>
 (Notes 12, 14 and 18)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,698)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,816)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Unrealized foreign exchange losses
 (gains)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(5,818)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(8,196)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,882</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(903)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(360)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">478</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Operating cash flows before working capital changes </p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>63,422</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">61,953</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">56,440</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Changes in assets and liabilities, net
 of effect from purchase of subsidiaries: </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Decrease (increase) in:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:12.3pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Trade and other receivables</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,119)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,315)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,305</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:12.3pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Inventories and supplies</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>343</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">509</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(9)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:12.3pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Prepaid expenses and other current
 assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,228</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,867)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,279)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Increase (decrease) in:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.8pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:12.3pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accounts payable</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(9,268)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,756</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,848</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:12.3pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accrued expenses and other current
 liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,928</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,116</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,844</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:12.3pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Unearned revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>983</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">110</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(343)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:12.3pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Income tax payable</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>357</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">103</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,367</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:12.3pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Deferred credits and other noncurrent
 liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,327</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(85)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,066)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net cash provided by operating activities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>61,201</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">66,280</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">63,107</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>CASH FLOWS FROM INVESTING ACTIVITIES</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Additions to property, plant and equipment</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(20,348)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(15,864)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(19,268)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Proceeds from disposal of property and equipment</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>766</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">912</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">112</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Payments for business acquired &#150; net of cash acquired (Note 9)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(11,018)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(248)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,276)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Disbursements) cash receipts for lease deposits and other noncurrent
 assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(745)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">974</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,834)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">(Increase) decrease in short-term investments</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(5,508)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,206</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,212)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Decrease (increase) in investments in debt securities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>89</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(60)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(286)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net cash used in investing activities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(36,764)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(13,080)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(24,764)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>CASH FLOWS FROM FINANCING ACTIVITIES</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Proceeds from long-term borrowings</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>18,883</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,797</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,187</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Payments of long-term borrowings</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(38,391)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(47,849)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(41,697)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Proceeds from notes payable</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>210</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">329</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">457</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Repayments of notes payable</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(128)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(387)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,412)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Dividends paid</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(14,999)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(11,173)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,692)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Proceeds from issuance of capital stock</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>66</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">334</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">281</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Payments of capital lease liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(211)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(38)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(134)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Redemption of shares of minority</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(8)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Settlements of derivatives</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(2,304)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,311)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(247)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Payments of debt issuance costs</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(34)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(172)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(68)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Net cash used in financing activities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(36,916)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(49,470)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(30,325)        </p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>EFFECT OF FOREIGN EXCHANGE RATE
 CHANGES ON CASH <br>
 AND CASH EQUIVALENTS</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(710)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(987)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(69)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>NET INCREASE (DECREASE) IN CASH AND
 CASH EQUIVALENTS</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.7pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(13,189)</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,743</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,949</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>CASH AND CASH EQUIVALENTS AT
 BEGINNING OF YEAR</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>30,059</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">27,316</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,367</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>CASH AND CASH EQUIVALENTS AT END OF YEAR</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>16,870</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30,059</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">27,316</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-top:3.0pt;text-align:justify' style="margin-top:0;margin-bottom:0"><i>See accompanying Notes to Consolidated Financial
Statements.</i></p>

<br clear=all
style='page-break-before:always'>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>PHILIPPINE LONG DISTANCE TELEPHONE COMPANY AND
SUBSIDIARIES</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>NOTES TO CONSOLIDATED FINANCIAL STATEMENTS</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.25in;text-align:justify;text-indent:
- -.25in;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Corporate
Information</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">The Philippine Long Distance Telephone Company, or
PLDT, or Parent Company, was incorporated under the old Corporation Law of the Philippines (Act 1459, as amended) on November 28, 1928, following the merger of four telephone
companies under common U.S. ownership.  Under its amended Articles of
Incorporation, PLDT&#146;s corporate term is currently limited through 2028.  In
1967, effective control of PLDT was sold by General Telephone and Electronics
Corporation (a major shareholder since PLDT&#146;s incorporation) to a group of
Filipino businessmen.  In 1981, in furtherance of the then existing policy of
the Philippine government to integrate the Philippine telecommunications
industry, PLDT purchased substantially all of the assets and liabilities of the
Republic Telephone Company, which at that time was the second largest telephone
company in the Philippines.  In 1998, First Pacific Company Limited, or First
Pacific, and its Philippine and other affiliates, or collectively the First
Pacific Group, acquired a significant interest in PLDT.  On March 24, 2000, NTT
Communications Corporation, or NTT Communications, through its wholly-owned
subsidiary NTT Communications Capital (UK) Ltd., or NTTC-UK, became PLDT&#146;s
strategic partner with approximately 15% economic and voting interest in the
issued and outstanding common stock of PLDT.  Simultaneous with NTT
Communications&#146; investment in PLDT, we acquired 100% of Smart Communications,
Inc., or Smart.  On March 14, 2006, NTT DoCoMo, Inc., or DoCoMo, acquired from
NTT Communications approximately 7% of PLDT&#146;s outstanding common shares held by
NTT Communications with NTT Communications retaining ownership of approximately
7% of PLDT&#146;s common shares.  On February 28, 2007, Metro Pacific Asset
Holdings, Inc., a Philippine affiliate of First Pacific completed the
acquisition of an additional interest of approximately 46% in Philippine
Telecommunications Investment Corporation, or PTIC, a shareholder of PLDT.  This
additional investment in PTIC represents an attributable interest of
approximately 6.4% of the issued common shares of PLDT and thereby raised First
Pacific Group&#146;s beneficial ownership to approximately 28% of PLDT&#146;s shares of
common stock as at that date.</p>

<p align=left style='text-align:left;text-indent:.5in;page-break-after:
auto;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
common shares of PLDT are listed and traded on the Philippine Stock Exchange,
or PSE.  On October 19, 1994, an American Depositary Receipt, or ADR, facility
was established, pursuant to which Citibank N.A., as the depositary, issued
ADRs evidencing American Depositary Shares, or ADSs, with each ADS representing
one PLDT common share with a par value of Php5 per share.  Effective February
10, 2003, PLDT appointed JP Morgan Chase Bank as successor depositary for
PLDT&#146;s ADR facility.  The ADSs are listed on the New York Stock Exchange, or
NYSE, in the United States and are traded on the NYSE under the symbol &#147;PHI&#148;.
As at December 31, 2006, there were a total of over 37 million ADSs
outstanding.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK75"></a><a
name="OLE_LINK74">Until recently, the ADSs were
also listed on the NYSE Arca.  However, on December 18, 2006, PLDT issued a
notice of its intent to voluntarily delist its ADSs from NYSE Arca, after
determining that doing so is in the best interest of PLDT and its stockholders
as it would eliminate the duplicative administrative burdens and costs inherent
in dual listing on both the NYSE and NYSE Arca.  The actual delisting from the
NYSE Arca became effective on February 12, 2007.</a></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
operates under the jurisdiction of the Philippine National Telecommunications
Commission, or NTC, which jurisdiction extends, among other things, to
approving major services offered by PLDT and certain rates charged by PLDT.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
registered office address is Ramon Cojuangco Building, Makati Avenue, Makati City , Philippines.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.25in;text-align:justify;text-indent:
- -.25in;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Basis of
Consolidated Financial Statements Preparation</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
consolidated financial statements have been prepared in conformity with
accounting principles generally accepted in the United States of America, or
U.S. GAAP.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Our consolidated financial statements include the
financial statements of PLDT and those of the following subsidiaries
(collectively, the PLDT Group).</p>

<p align=right style='text-align:right;text-indent:.5in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.72%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   rowspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Name of Subsidiary</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:0in;
 margin-bottom:0in;margin-left:1.45pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Place of Incorporation</b></p>
 </td>
 <td   rowspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:0in;
 margin-bottom:0in;margin-left:1.45pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Principal Activity</b></p>
 </td>
 <td   colspan=2 valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Percentage of Ownership</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Direct</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.5pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Indirect</b></p>
 </td>
 </tr>

 <tr style='height:5.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p style='margin-left:1.45pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:5.0pt'>
 <p style='margin-left:1.45pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:5.0pt'>
 <p align=right style='margin-right:.1in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   colspan=5 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:.1in;margin-bottom:
 1.0pt;margin-left:0in' style="margin-top:0;margin-bottom:0"><b>Wireless</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Smart
 Communications, Inc., or Smart</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Cellular mobile services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Smart
 Broadband, Inc., or Smart Broadband, (formerly Meridian Telekoms, Inc., or Meridian)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet broadband and distributor</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in' style="margin-top:0;margin-bottom:0">Wolfpac Mobile, Inc.,
 or Wolfpac </p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Mobile applications developer and <br>
 service provider</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Pilipino
 Telephone Corporation, or Piltel</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Providing cellular and fixed line services</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">92.1</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Telesat,
 Inc., or Telesat</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite communications services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">94.4</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ACeS Philippines Cellular Satellite <br>
 Corporation, or ACeS Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite phone services</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">88.5</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">11.5</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Mabuhay Satellite Corporation, or <br>
 Mabuhay Satellite</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Satellite communications services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">67.0</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   colspan=5 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:0in' style="margin-top:0;margin-bottom:0"><b>Fixed Line</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">PLDT
 Clark Telecom, Inc., or ClarkTel</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Subic
 Telecommunications Company, Inc., <br>
 or SubicTel</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications
 services</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">PLDT
 Global Corporation, or PLDT Global</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">British Virgin Islands</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications
 services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Smart-NTT
 Multimedia, Inc., or SNMI</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Data
 and network services</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">PLDT-Maratel,
 Inc., or Maratel</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications
 services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">97.5</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Bonifacio
 Communications Corporation, or BCC</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Telecommunications,
 infrastructure <br>
 and related value-added services</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">75.0</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p style='margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:.1in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:0in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:16.2pt'>
 <td   colspan=5 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:16.2pt'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:0in' style="margin-top:0;margin-bottom:0"><b>Information and
 Communications Technology</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ePLDT,
 Inc., or ePLDT</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Information
 and communications infrastructure for internet-based services, e-commerce,
 call centers <br>
 and IT-related services</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Vocativ
 Systems, Inc., or Vocativ</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Call
 center services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Parlance
 Systems, Inc., or Parlance</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Call
 center services</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">ePLDT
 Ventus, Inc., or Ventus</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Call
 center services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">SPi
 Technologies, Inc., or SPi, and Subsidiaries (including CyMed, Inc., or
 CyMed)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Business
 process outsourcing, or <br>
 BPO, services</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">100.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Infocom
 Technologies, Inc., or Infocom</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet
 services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">99.6</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">netGames,
 Inc., or netGames</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Publisher
 of online games</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">80.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Digital
 Paradise, Inc., or Digital Paradise, (formerly Netopia Computer <br>
 Technologies, Inc.)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet
 access services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">75.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Level
 Up! (Philippines), Inc., or Level Up!</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Publisher
 of online games</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">60.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Digital
 Paradise Thailand</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Thailand</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Internet
 access services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">51.0</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Airborne
 Access Corporation, or Airborne Access</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:1.0pt;margin-right:0in;
 margin-bottom:1.0pt;margin-left:.15in;text-align:center;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Philippines</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-top:1.0pt;margin-right:0in;margin-bottom:
 1.0pt;margin-left:.15in;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Wireless
 internet services</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:.2in;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.5pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:1.0pt;margin-right:12.35pt;
 margin-bottom:1.0pt;margin-left:0in;text-align:right' style="margin-top:0;margin-bottom:0">51.0</p>
 </td>
 </tr>
</table></center></div>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">SPi, CyMed and Level Up! were all acquired in 2006 and included
in our 2006 consolidated financial statements, see <i>Note 9 &#150; Goodwill and
Other Intangible Assets</i>.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The method of accounting applied to investments, whether
consolidated, equity or cost, involves an evaluation of all significant terms
of the investments that explicitly grant or suggest evidence of control or
significant influence over the operations of the investee.  The consolidated
financial statements include our controlled subsidiaries. Investments in
businesses which we do not control, but have the ability to exercise
significant influence over operating and financial policies, are accounted for
using the equity method.  Investments in which we do not have the ability to
exercise significant influence over operating and financial policies are
accounted for using the cost method.  Equity and cost method investments are
included in the &#147;Investments&#148; account in our consolidated balance sheets.  </p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
consolidated financial statements are prepared using uniform accounting
policies for like transactions and events with similar circumstances.
Intercompany balances and transactions, including intercompany profits and
unrealized profits and losses, are eliminated in consolidation.</p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Minority
interests represent the equity interests in Piltel, Level Up!, Telesat, Mabuhay
Satellite, Maratel, BCC, Digital Paradise, Digital Paradise Thailand, netGames,
Infocom, and Airborne Access, not held by the PLDT Group.</p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.5in;text-indent:-.5in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Summary of Significant
Accounting Policies and Practices</b></p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Our
significant accounting policies and practices are discussed below to facilitate
the understanding of our consolidated financial statements:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Management&#146;s Use of
Estimates</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
preparation of our consolidated financial statements in conformity with U.S.
GAAP requires us to make estimates and assumptions that affect the reported
amounts of our assets and liabilities and disclosure of contingent assets and
liabilities at the date of the consolidated financial statements, and the
reported amounts of revenues and expenses during the period reported.  Actual
results could differ from those estimates.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Examples
of significant estimates include the allowance for doubtful accounts, inventory
obsolescence, depreciation rate, impairment of intangibles, investments and
other long-lived assets, valuation allowance on deferred tax assets, pension
benefit assumptions, asset retirement obligation measurement, stock option
valuation and purchase price allocation.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Concentrations</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:35.45pt' style="margin-top:0;margin-bottom:0">The
PLDT Group&#146;s results of operations and financial performance and condition may
be influenced by the general political situation in the Philippines.  The Philippines experienced several <i>coup d&#146;&#233;tat</i> attempts against the government
administration between 1986 and 1989, and in July 2003.  Political conditions
in the Philippines were generally stable during the 1990&#146;s.  In the past four
years, an increasing number of kidnappings and criminal and terrorist
activities have occurred in Mindanao, principally led by the extremist &#147;Abu
Sayyaf&#148; group, which reportedly has ties to the Al-Qaeda terrorist network.
There were series of bombing incidents in key cities in Mindanao, including Davao City.  The armed conflict between the Philippine military and the communist Moro
Islamic Liberation Front also continues in Mindanao.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:35.45pt' style="margin-top:0;margin-bottom:0">The
PLDT Group&#146;s results of operations may be negatively affected by slow or negative
growth rates and economic instability in the Philippines and in Asia.  In the past, the Philippines has experienced periods of slow or negative growth,
high inflation, significant devaluation of the peso, imposition of exchange
controls, debt restructuring and electricity shortages and blackouts.  From
mid-1997 to 1999, the economies of a number of Asian countries experienced
significant downturns.  The regional economic turbulence affected the
Philippine economy in a number of ways, including the depreciation of the peso,
increases in interest rates, increases in unemployment and inflation, increased
volatility and a decline in prices in the domestic stock market, the
downgrading of the Philippines&#146; local currency rating and the ratings outlook
for the Philippine banking sector and the reduction of foreign currency
reserves.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:35.3pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As at December 31, 2006, other than the concentration
of our wireless services on prepaid subscribers, we do not have any significant
concentration of business transacted with a particular supplier, lender or
former affiliate that could, if suddenly adversely impacted, severely impact
our operations.  We also do not have a concentration of available sources or
other rights that could, if suddenly eliminated, severely impact our
operations.  We invest our cash and cash equivalents with various high-quality
financial institutions.</p>

<p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Revenue Recognition</i></b></p>

<p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Revenues for services are stated at
amounts invoiced to customers, net of value-added tax, or VAT, or overseas
communications tax, or OCT, if applicable.  We provide wireless communication,
fixed line communication, and information and communications technology
services.  We provide such services to mobile, business, residential and
payphone customers.  Revenues represent the value of fixed consideration that
have been received or are receivable.  Revenues are recognized when there is
evidence of an arrangement, collectibility is reasonably assured, and the
delivery of the product or service has occurred.  In certain circumstances, revenue
is split into separately identifiable components and recognized when the
related components are delivered in order to reflect the substance of the
transactions.  The value of components is determined using verifiable objective
evidence.  We do not provide our customers with the right to a refund.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Service
revenues</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Subscriptions.
</i>We provide telephone and data
communication services under prepaid and postpaid payment arrangements.  Installation and activation-related fees and the
corresponding costs, not exceeding the activation revenue, are deferred and
recognized over the expected average periods of customer relationship for fixed
line and cellular service.  Postpaid service arrangements include subscription
fees, typically fixed monthly fees, which are recognized over the subscription
period on a pro rata basis. </p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Air
time, traffic and value-added services.  </i>Prepaid service revenues collected in advance are deferred and
recognized based on the earlier of actual usage or upon expiration of the usage
period.  Interconnection revenues for call termination, call transit, and
network usage are recognized in the period the traffic occurs.  Revenues
related to local, long distance, network-to-network, roaming and international
call connection services are recognized when the call is placed or connection
is provided, net of amounts payable to other telecommunication carriers for
terminating calls in their territories.  Revenues related to products and
value-added services are recognized upon delivery of the product or service.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:40.3pt' style="margin-top:0;margin-bottom:0"><i>Business
Process Outsourcing, or BPO.  </i>Revenue
is recognized when it is probable that the economic benefits associated with
the transactions will flow to us and the amount of revenue can be measured
reliably.  Advance customer receipts are
recorded as advances from customers and presented as a liability in the
consolidated balance sheet.  For arrangements requiring specific customer
acceptance, revenue recognition is deferred until the earlier of the end of the
deemed acceptance period or until written notice of acceptance is received from
the customer.  Revenue on services rendered to customers whose ability to pay
is in doubt at the time of performance of services is also not recorded.
Rather, revenue is recognized from these customers as payment is received.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Non-service
revenues</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Handset
and equipment sales.  </i>Sales of
cellular handsets and communication equipment are recognized upon delivery to
the customer.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><i>Cash and Cash Equivalents</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash includes cash on hand and in banks.  Cash equivalents
are short-term, highly liquid investments that are readily convertible to known
amounts of cash with original maturities of three months or less from the date
of acquisition and that are subject to an insignificant risk of change in
value.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b><i>Short-term Investments</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Short-term
investments includes time deposits with original maturities of more than three
months but not more than one year from the date of acquisition of Php5,519
million and Php19 million as at December 31, 2006 and 2005, respectively.  This
also includes trading securities that are bought and held principally for the
purpose of selling them in the near term and reported at fair value, with
unrealized gains and losses included in earnings of Php2,808 million and Php2,731
million as at December 31, 2006 and 2005, respectively.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b><i>Trade and Other Receivables</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Trade
and other receivables are stated at face value, net of an allowance for any
doubtful accounts.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><i>Allowance for Doubtful Accounts</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Allowance
for doubtful accounts is maintained at a level considered adequate to provide
for uncollectible receivables.  The level of allowance is based on historical
collections, write-off experience, current economic trends, changes in our
customer payment terms and other factors that may affect our ability to collect
payments.  An evaluation of the receivables, designed to identify potential
charges to the allowance, is performed on a continuous basis during the year.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Subscribers</i>.
Full allowance is provided for receivables from permanently disconnected
subscribers.  Permanent disconnections are made after a series of collection
steps following non-payment by subscribers.  Such permanent disconnections
generally occur within 105 days from the date of payment was due.  Partial
allowance is provided for active subscribers based on the historical loss
experience and aging profile of the receivable.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Traffic
settlement receivables &#150; net</i>.  Full
allowance is provided for carrier accounts which are considered overdue and
after a review of the status of settlement with other carriers.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><i>Inventories and Supplies</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Inventories and supplies which
include, among other things, cellular phone units, materials, spare parts,
terminal units and accessories, are valued at the lower of cost and market
value.  Cost is determined using the moving average method.  Allowance for
inventory obsolescence is set for based on the lower of cost or market value of
inventories.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><i>Property, Plant and Equipment</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Property, plant and equipment, except for land, are
stated at cost less accumulated depreciation and amortization.  Land is stated
at cost.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The initial cost of property, plant and equipment
comprises its purchase price and any costs directly attributable in bringing
the asset to its working condition and location for its intended use, plus the
fair value of asset retirement obligations.  Expenditures incurred after the
assets have been put into operation, such as repairs and maintenance and
overhaul costs, are normally charged to income in the year the costs are
incurred.  In situations where it can be clearly demonstrated that the
expenditures have resulted in an increase in the future economic benefits
expected to be obtained from the use of an item of property, plant and
equipment beyond its originally assessed standard of performance, the
expenditures are capitalized as additional costs of property, plant and
equipment.  Cost also includes interests on borrowed funds used during the
construction period.  When assets are sold or retired, their costs and
accumulated depreciation and amortization, if any, are eliminated from the
accounts and any gain or loss resulting from their disposal is included in the
consolidated statement of income of such period.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Depreciation and amortization are
calculated on a straight-line basis over the estimated useful lives of the
assets:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:83.34%;margin-left:41.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style=';text-indent:.9pt' style="margin-top:0;margin-bottom:0"><b><u>&nbsp;</u></b></p>
 </td>
 <td   valign=top style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>Estimated<u><br>
 Useful Lives</u></b></p>
 </td>
 </tr>

 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';text-indent:.9pt' style="margin-top:0;margin-bottom:0">Buildings</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">25 &#150; 40 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';text-indent:.9pt' style="margin-top:0;margin-bottom:0">Cable and wire facilities </p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">20 &#150; 25 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';text-indent:.9pt' style="margin-top:0;margin-bottom:0">Central office equipment</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">15 &#150; 20 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';text-indent:.9pt' style="margin-top:0;margin-bottom:0">Communications satellite</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">15 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';text-indent:.9pt' style="margin-top:0;margin-bottom:0">Information origination and termination equipment</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">5 &#150; 15 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';text-indent:.9pt' style="margin-top:0;margin-bottom:0">Cellular facilities</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">10 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';text-indent:.9pt' style="margin-top:0;margin-bottom:0">Land improvements</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">10 years</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style=';text-indent:.9pt' style="margin-top:0;margin-bottom:0">Vehicles, furniture and other work equipment</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">3 &#150; 10 years</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
useful lives and depreciation and amortization method are reviewed periodically
to ensure that the periods and method of depreciation and amortization are
consistent with the expected pattern of economic benefits from items of
property, plant and equipment.  </p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Property under construction is
stated at cost.  This includes cost of construction, plant and equipment and
other direct costs.  Property under construction is not depreciated until such
time that the relevant assets are completed and substantially available for
their intended use.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest and other costs incurred in connection with
the borrowing of funds are capitalized during the construction of plant and
equipment as part of the cost of acquiring assets.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest capitalization ceases once a project is
substantially complete or no longer undergoing construction activities to
prepare it to its intended use.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='background:white' style="margin-top:0;margin-bottom:0"><b><i>Investments in Equity Interests</i></b></p>

<p style='background:white' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;background:white' style="margin-top:0;margin-bottom:0">Investments in entities in which we can
exercise significant influence but in which we do not own a majority equity
interest or which we do not otherwise control, are accounted for using the
equity method and included as investments in our consolidated balance sheets.
We record our share of the results of these companies in the line item equity
share in net income (losses) of associates in our consolidated statements of
income.  We monitor our investments for other-than-temporary impairment by
considering factors including the stock price of public companies in which we
have an equity investment as well as current economic and market conditions and
the operating performance of the companies and record reductions in carrying
values when necessary.  The fair value of privately held investments is
estimated using the best available information as of the valuation date,
including current earnings trends, discounted cash flows, quoted stock prices
of comparable public companies, and other company specific information,
including recent financings.</p>

<p style='background:white' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The carrying amounts of our investments are greater than the
underlying equity in net assets of these companies in certain cases due in part
to goodwill, which is not subject to amortization in accordance with SFAS No.
142, &#147;Goodwill and Other Intangible Assets&#148;.  This goodwill is evaluated for
impairment in accordance with Accounting
Principles Board, or APB,
Opinion No. 18, &#147;The Equity Method of Accounting for Investments in Common
Stock&#148;.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Goodwill and Other Intangible Assets</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Goodwill is the excess of the acquisition cost of a
business, including investments accounted for using the equity method, over the
fair value of the identifiable net tangible and intangible assets acquired.  Goodwill
is initially measured at cost which is defined as the excess of the acquisition
cost over the fair value of identifiable assets, liabilities and contingent
liabilities. In accordance with the provisions of SFAS No. 142, goodwill is not
amortized.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Goodwill
is reviewed for impairment, annually or more frequently if events or changes in circumstances
indicate that the carrying value may be impaired.  The impairment of goodwill
is determined through a two-step approach, which is performed at the reporting
unit level.  Step one entails comparing the fair value of the reporting unit
(calculated using a discounted cash flow method) to its carrying value.  If the
carrying value exceeds the fair value, there is a potential impairment and step
two must be performed.  Step two entails comparing the carrying value of the
reporting unit&#146;s goodwill to its implied fair value (i.e. fair value of
reporting unit less the fair value of the unit&#146;s assets and liabilities,
including identifiable intangible assets).  If the carrying value of goodwill
exceeds its implied fair value, the excess is required to be recorded as an
impairment.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Intangible
assets
arising from business combinations are initially recognized at fair value at the date of
acquisition. Where an intangible assets has a finite life, it is amortized on a
straight-line basis over its estimated useful life.  We reevaluate the useful
life determination for these intangible assets each reporting period to
determine whether events and circumstances warrant a revision in their remaining
useful life.  Intangible assets with finite useful lives are reviewed whenever
events or circumstances arise indicating that an impairment loss may exist.  If
any such indications are present, we test the intangible assets for
recoverability by comparing the carrying amount of the intangible asset to the
net undiscounted cash flows expected to be generated from the intangible
asset.  If those net undiscounted cash flows do not exceed the carrying amount
(i.e. the intangible asset is not recoverable), we determine the fair value of
the asset and record an impairment, if any.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Where
there are no legal, regulatory, contractual or other factors that would
reasonably limit the useful life of an intangible asset, we classify the
intangible asset as indefinite lived and such intangible assets are not
amortized but tested for impairment annually.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Impairment of Long-Lived Assets</i></b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">We review long-lived assets, other than goodwill and other intangible
assets with indefinite lives, for impairment whenever facts and
circumstances indicate that the carrying amounts of the assets may not be
recoverable. For measurement purposes, long-lived assets are grouped with other
assets and liabilities at the lowest level for which identifiable cash flows
are largely independent of the cash f lows of other assets and liabilities. An
impairment loss is recognized only if the carrying amount of the asset group is
not recoverable and exceeds its fair value. Recoverability of the asset group
to be held and used is measured by comparing the carrying amount of the asset
group to the estimated undiscounted future net cash flows expected to be
generated by the asset group. If the asset group&#146;s carrying value is not
recoverable, an impairment charge is recognized for the amount by which the
carrying amount of the asset group exceeds its fair value. We determine fair
values by using a combination of comparable market values and discounted cash
flows, as appropriate.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b><i>Asset Retirement Obligations</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Under
SFAS No. 143, &#147;Accounting for Asset Retirement Obligations&#148;, the fair value of
legal obligations associated with the retirement of a tangible long-lived asset
that resulted from the acquisition, construction or development and the normal
operation of a long-lived asset is required to be recognized in the period in
which it is incurred.  Under SFAS No. 143, the PLDT Group recognizes asset
retirement obligations in the period in which they are incurred if a reasonable
estimate of a fair value can be made.  The related asset retirement costs are
capitalized as part of the carrying amount of the corresponding long-lived
asset.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
PLDT Group is legally required under various lease agreements to dismantle various
installations and restore its leased sites at the end of the lease contract
term.  The PLDT Group recognizes the fair value of the liability for these
obligations and capitalizes the present value of these costs as part of the
balance of the related property and equipment accounts, such costs are being
depreciated on a straight-line basis over the useful lives of the related
assets or the contract periods, whichever is shorter.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following table summarizes the changes to the asset retirement obligations as
at December 31, 2006 and 2005:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;margin-left:.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:8.85pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=right style='margin-right:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=right style='margin-right:8.95pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:18.4pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Asset retirement obligations at beginning of year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>752</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.95pt;text-align:right' style="margin-top:0;margin-bottom:0">638</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Accretion expenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>87</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.95pt;text-align:right' style="margin-top:0;margin-bottom:0">79</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Additional liability recognized during the year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>45</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.95pt;text-align:right' style="margin-top:0;margin-bottom:0">63</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Settlement of obligations</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(53)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right' style="margin-top:0;margin-bottom:0">(28)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.1pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:12.1pt'>
 <p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Asset retirement obligations at end of year (Note
 13)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:12.1pt'>
 <p align=right style='margin-right:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 831</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:12.1pt'>
 <p align=right style='margin-right:8.95pt;text-align:right' style="margin-top:0;margin-bottom:0"> 752</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">A
reliable estimate of a market risk premium is not obtainable and therefore is
excluded from estimating the fair value of the asset retirement obligation.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Effective
January 1, 2006, we adopted FASB Interpretation, or FIN, No. 47, &#147;Accounting
for Conditional Asset Retirement Obligations &#150;&#150; An interpretation of FASB
Statement No. 143&#148;.  The adoption of SFAS No. 143 did not have a material
effect on our consolidated financial statements in 2006.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><i>Investments available-for-sale</i></b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Investments available-for-sale are measured at fair
value with unrealized gains or losses being recognized directly in the equity
account as accumulated other comprehensive income (loss) except when the
financial asset is impaired.  When the investment is disposed of, the
cumulative gain or loss previously recorded in equity is recognized in the
consolidated statement of income.</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><i>Debt Issuance Costs</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:40.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Issuance costs, underwriting fees and related expenses
incurred in connection with the issuance of debt instruments are deferred and
amortized using the effective interest rate method over the terms of the
instruments.  Unamortized debt issuance costs are charged to operations when
the related debt is significantly modified and extinguished.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b><i>Retirement Costs</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
September 2006, the FASB issued SFAS No. 158, &#147;Employers&#146; Accounting for
Defined Benefit Pension and Other Postretirement Plans &#150;&#150; An amendment of FASB
Statements No. 87, 88, 106 and SFAS No. 123 (R), &#147;Share-Based Payment&#148;.  SFAS No.
158 requires the recognition of a defined benefit postretirement plan&#146;s funded
status as either an asset or liability on the balance sheet.  SFAS No. 158 also
requires the immediate recognition of the unrecognized actuarial gains and
losses and prior service costs and credits that arise during the period as a
component of other accumulated comprehensive income, net of applicable income
taxes.  Additionally, the fair value of plan assets must be determined at
year-end.  We adopted SFAS No. 158 effective December 31, 2006, which resulted
in a net decrease to stockholders&#146; equity of Php3,303 million (net of tax of
Php1,415), see <i>Note 17 &#150; Employee Benefits</i>.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Defined
Benefit Pension</i></p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
unfunded status of PLDT&#146;s retirement-related benefit plans is recognized in our
consolidated balance sheets.  The unfunded status is measured as the difference
between the fair value of plan assets and the benefit obligation at December
31, the measurement date.  For defined benefit pension plans, the benefit
obligation is the projected benefit obligation, or PBO.  The PBO represents the
actuarial present value of benefits expected to be paid upon retirement based
on estimated future compensation levels.  The fair value of plan assets
represents the current market value of our cumulative contributions made to the
retirement irrevocable trust fund, held for the sole benefit of participants,
which contributions are invested by the trust fund.  Overfunded plans, with the
fair value of plan assets exceeding the benefit obligation, are aggregated and
recorded as a prepaid pension asset equal to this excess.  Underfunded plans,
with the benefit obligation exceeding the fair value of plan assets, are
aggregated and recorded as a retirement benefit obligation equal to this
excess.  The current portion of the retirement benefit obligation represents
the actuarial present value of benefits payable in the next 12 months exceeding
the fair value of plan assets, measured on a plan-by-plan basis.  This
liability is recorded in compensation and benefits in our consolidated
statements of income.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">(Gains) / losses and
prior service cost / (credit) not recognized as a component of net periodic
pension <br>
cost / (income) in our consolidated statements of income as they arise, are
recognized as a component of accumulated other comprehensive income (loss) in our
consolidated statement of stockholders&#146; equity, net of tax.  Those (gains) / losses
and prior service cost / (credit) are subsequently recognized as a component of
net periodic pension period cost / (income) pursuant to the recognition and
amortization provisions of applicable accounting standards.  (Gains) / losses
arise as a result of differences between actual experience and assumptions or
as a result of changes in actuarial assumptions.  Prior service cost / (credit)
represents the cost of benefit improvements attributable to prior service
granted in plan amendments.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">Net periodic pension
cost / (income) is recorded in our consolidated statements of income and
includes service cost, interest cost, expected return on plan assets,
amortization of prior service cost and (gains) / losses previously recognized
as a component of accumulated other comprehensive income (loss) and
amortization of the net transition asset remaining in accumulated other
comprehensive income (loss).  Service cost represents the actuarial present
value of participant benefits earned in the current year. Interest cost
represents the time value of money cost associated with the passage of time.  Certain
events, such as changes in employee base, plan amendments and changes in
actuarial assumptions, result in a change in the benefit obligation and the
corresponding change in accumulated other comprehensive income (loss).  The
result of these events is amortized as a component of net periodic cost / (income)
over the service lives of the participants, provided such amounts exceed
thresholds which are based upon the benefit obligation or the value of plan
assets.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">The measurement of the
benefit obligation and net periodic pension cost / (income) is based on PLDT&#146;s estimates
and actuarial valuations provided by third-party actuaries which are approved
by PLDT&#146;s management.  These valuations reflect the terms of the plans and use
participant-specific information such as compensation, age and years of service
as well as certain assumptions, including estimates of discount rates, expected
return on plan assets, rate of compensation increases, interest crediting rates
and mortality rates.</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.25in' style="margin-top:0;margin-bottom:0"><i>Defined
Contribution Plans</i></p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart and I-Contacts,
Inc. record expenses for defined contribution plans for their contribution when
the employee renders service to Smart and I-Contacts, Inc., respectively,
essentially coinciding with their cash contributions to the plans.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Stock-Based Compensation</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">We have historically accounted for stock-based
employee compensation plans under APB Opinion No. 25, &#147;Accounting for Stock
Issued to Employees&#148;, and related interpretations, and followed the
disclosure-only provisions of SFAS No. 123, &#147;Accounting for Stock-Based
Compensation&#148;.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Under
APB Opinion No. 25, compensation cost is measured at the intrinsic value, which
is the difference between market price and exercise price, if any, on the
measurement date.  Under SFAS No. 123, compensation cost is calculated based on
the fair value of the options granted.  Fair value is determined using an
acceptable option-pricing model based on certain management assumptions and
compensation expense is recognized over the performance period.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Effective
January 1, 2006, we adopted SFAS No. 123 (R), &#147;Share-Based Payment&#148;, which
revises SFAS No. 123. This statement requires an entity to measure the cost of
employee services received in exchange for an award of equity instruments based
on the grant-date fair value of the award and to recognize that cost over the
period that an employee is required to provide service in exchange for the
award.  Any awards of liability instruments to employees would be measured at
fair value at each reporting date through settlement. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">We
adopted SFAS No. 123 (R) using the modified prospective transition method, and
accordingly, the results of prior periods have not been restated. This method
requires that the provisions of SFAS No. 123 (R) are applied only to unvested share-based
awards as of January 1, 2006.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
dilutive effect of outstanding options is reflected as additional share
dilution in the computation of earnings per common share, see <i>Note 20 &#150;
Earnings Per Common Share</i>.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
cumulative effect of adoption of SFAS No. 123 (R) on prior years resulted in a
change in our reported net income of Php189 million (net of income taxes of Php93
million and Php1.02 per share) in 2006, which represents the difference between
the intrinsic value and the fair value of the liability award on January 1,
2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Had
compensation expense for PLDT&#146;s stock option plan, stock purchase plan and
original Long-Term Incentive Plan been determined based on the fair value at
the grant date of awards for years 2005 and 2004 consistent with the provision
of SFAS No. 123 (R), PLDT&#146;s net income in 2005 would have increased by Php1
million whereas in 2004 would have decreased by Php92 million.  The pro forma
amounts are indicated below:</p>

<p align=right style='text-align:right;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.88%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:7.1pt'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;height:7.1pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.1pt'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:27.0pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   colspan=2 valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:7.1pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;
 text-indent:.75in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:27.0pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos,
 except per share amounts) </p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:8.6pt;text-indent:-8.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Consolidated net income attributable to
 common <br>
 shareholders (Note 20)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">37,483</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38,787</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,834</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">26,313</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:26.6pt;text-indent:-26.6pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Add:  Total stock-based employee
 compensation expense included in net income</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">824</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">824</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">239</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">239</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:.5in;text-indent:-.5in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Deduct:  Total stock-based employee
 compensation expense determined under fair value based method</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(823)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(823)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(331)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(331)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Pro forma consolidated net income
 attributable to common shareholders</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">37,484</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38,788</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,742</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">26,221</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Earnings per common share:</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As reported</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">217.84</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">211.93</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">146.32</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">145.30</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Pro forma</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">217.84</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">211.93</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">145.77</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">144.79</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The dilutive effect of outstanding options is reflected
as additional share dilution in the computation of earnings per common share,
see <i>Note 20 &#150; Earnings Per Common Share</i>.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Leases</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Lease obligations having provisions for bargain
purchase options, ownership transfer at the end of the lease term, a lease term equal to 75% or more of the estimated
economic life of the leased property, or lease obligations where the present
value at the beginning of the lease term of the minimum lease payments
(excluding executory costs and taxes to be paid or paid by the lessor and
including any profit thereon) equals or exceeds 90% of the fair value of the
leased property, are capitalized.  The
related obligations are recognized as liabilities.  Minimum lease payments are allocated between the finance charges and reduction of the
lease liability so as to achieve a constant periodic rate of interest on the remaining balance of the
liability.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">A
capital lease gives rise to a depreciation expense for the asset, as well as an
interest expense for each period.  Finance charges are charged directly to
current operations.  The depreciation policy for leased assets is consistent
with that for depreciable assets that are owned.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Leases
where the lessor retains substantially all the risks and benefits of ownership
of the asset are classified as operating leases.  Initial direct costs incurred
in negotiating an operating lease are deferred and amortized on a straight-line
method over the lease term on the same bases as the lease income.  Operating
lease payments are recognized as an expense in the consolidated statements of
income on a straight-line basis over the lease term.  For income tax reporting
purposes, expenses that should have been incurred under a lease agreement are
considered deductible expenses.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Operating
lease expense amounted to Php2,257
million, Php2,086 million and Php2,160
million in 2006, 2005 and 2004, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b><i>Advertising and Promotion Expenses</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Advertising
and promotions are expensed as incurred.  Advertising and promotion expenses
amounted to Php4,142 million, Php4,160 million and Php5,002 million in 2006, 2005
and 2004, respectively. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b><i>Repairs and Maintenance Expenses</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Repairs
and maintenance are expensed as incurred.  Repairs and maintenance expenses
amounted to Php7,565 million, Php6,705 million and Php5,671 million in 2006, 2005
and 2004, respectively. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Foreign Currency Transactions and Translations</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The functional currency of the PLDT Group (except for
Mabuhay Satellite, PLDT Global, Digital Paradise Thailand and SPi and certain
of its subsidiaries) is the Philippine peso.  Transactions in foreign
currencies are initially recorded in the functional currency rate prevailing at
the date of the transaction.  Monetary assets and liabilities denominated in
foreign currencies are translated at the functional currency rate of exchange
prevailing at the balance sheet date.  All differences are recognized in the
consolidated statement of income.  For income tax purposes, exchange gains or
losses are treated as taxable income or deductible expenses in the year such
exchange gains or losses are realized.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The functional currency of Mabuhay Satellite, PLDT
Global, SPi and certain of its subsidiaries is the U.S. dollar and Digital
Paradise Thailand is the Thai Baht.  As at the reporting date, the assets and
liabilities of these subsidiaries are translated into the reporting currency of
the PLDT Group at the rate of exchange prevailing at the balance sheet date,
and income and expenses of these subsidiaries are translated at the weighted
average exchange rate for the year.  The exchange differences arising on
translation are taken directly to a separate component of equity as accumulated
other comprehensive income (loss).  On disposal of these subsidiaries, the
amount of deferred accumulated other comprehensive income (loss) recognized in
equity relating to subsidiaries is recognized in the consolidated statement of
income.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Derivatives and Hedging Instruments</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The Company recognizes all derivatives on the
consolidated balance sheet at fair value.  Derivatives that are not designated
as hedges are recognized at fair value through earnings.  If the derivative is
a hedge, depending on the nature of the hedge, and to the extent of the hedge&#146;s
effectiveness, changes in the fair value of derivatives are either offset
against the change in fair value of hedged assets, liabilities, or firm commitments
through earnings or recognized in other comprehensive income (loss) until the
hedged item is recognized in earnings.  The ineffective portion of a
derivative&#146;s change in fair value will be immediately recognized in earnings.
The PLDT Group enters into derivatives that are meant to be economic hedges of
identified underlying instruments and are marked to market directly through
earnings.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b><i>Income Taxes</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Deferred income tax is provided using the liability
method.  Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to: (a) temporary differences between the financial
reporting bases of assets and liabilities and their related tax bases and (b)
carryforward benefits of net operating loss carryover, or NOLCO, and minimum
corporate income tax, or MCIT.  Deferred tax assets and liabilities are
measured using the tax rates applicable to taxable income in the years in which
those temporary differences are expected to be recovered or settled, and the
carryforward benefits of NOLCO and MCIT are expected to be applied.  A
valuation allowance is provided for deferred tax assets when it is more likely
than not that some or all of the deferred tax assets will not be realized in
the future.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-indent:-.25in' style="margin-top:0;margin-bottom:0"><b><i>Earnings Per Common Share, or EPS</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Basic
EPS is calculated by dividing the net income or loss for the year attributable
to common shareholders by the weighted average number of common shares
outstanding during the year, after giving retroactive effect to any stock
dividend declarations.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Diluted
EPS is calculated in the same manner assuming that, at the beginning of the
year or at the time of issuance during the year, all outstanding options are
exercised and convertible preferred shares are converted to common shares.
Outstanding stock options will have a dilutive effect under the treasury stock
method only when the average market price of the underlying common share during
the period exceeds the exercise price of the option.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Where
the effect of the assumed conversion of the preferred shares and the exercise
of all outstanding options is anti-dilutive, basic and diluted EPS are stated
at the same amount.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Other Recently Adopted Accounting Pronouncements</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
September 2006, the U.S. Securities and Exchange Commission issued Staff Accounting
Bulletin, or SAB, No. 108, &#147;Considering the Effects of Prior Year Misstatements
when Quantifying Misstatements in Current Year Financial Statements&#148;.  SAB 108
was effective for us upon adoption on December 31, 2006.  SAB 108 did not have
a material effect on our consolidated financial statements in 2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
May 2005, the FASB, as part of an effort to conform to international accounting
standards, issued SFAS No. 154, &#147;Accounting Changes and Error Corrections&#148;,
which was effective for us beginning on January 1, 2006.  SFAS No. 154 requires
that all voluntary changes in accounting principles be retrospectively applied
to prior financial statements as if that principle had always been used, unless
it is impracticable to do so.  When it is impracticable to calculate the
effects on all prior periods, SFAS No. 154 requires that the new principle be
applied to the earliest period practicable. The adoption of SFAS No. 154 did not
have a material effect on our consolidated financial statements in 2006.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:35.45pt' style="margin-top:0;margin-bottom:0"><b><i>New Accounting Pronouncements Effective Subsequent to 2006</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In February 2006, FASB issued SFAS No. 155,
&#147;Accounting for Certain Hybrid Financial Instruments&#148;, an amendment to SFAS No.
133 and SFAS No. 140.  SFAS No. 155 permits an entity to elect fair value remeasurement
for any hybrid financial instrument (with changes in fair value recognized in
earnings) if the hybrid instrument contains an embedded derivative that would
otherwise be required to be bifurcated and accounted for separately under SFAS No.
133.  The election to measure the hybrid instrument at fair value is made on an
instrument-by-instrument basis and is irreversible.  The statement will be
effective for all financial instruments acquired, issued, or subject to a
remeasurement event occurring after the beginning of an entity&#146;s fiscal years
beginning after September 15, 2006, with earlier adoption permitted as of the
beginning of fiscal year, provided that financial statements for any interim
period of that fiscal year have not been issued.  We are currently in the process of
evaluating any effect of the adoption of FAS 155 will have on our consolidated
financial statements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In June 2006, the EITF reached a consensus on Issue
No. 06-3, &#147;How Taxes Collected from Customers and Remitted to Governmental Authorities
Should Be Presented in the Income Statement (That Is, Gross Versus Net
Presentation)&#148;.  EITF Issue No. 06-3 requires that companies disclose their
accounting policy regarding the gross or net presentation of certain taxes.
Taxes within the scope of EITF Issue No. 06-3 are any tax assessed by a
governmental authority that is directly imposed on a revenue-producing
transaction between a seller and a customer and may include, but is not limited
to, sales, use, value added and some excise taxes.  EITF Issue No. 06-3 is
effective for our reporting period beginning January 1, 2007.  We are currently
in the process of determining the impact of this issue on our consolidated
financial statements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In June 2006, the FASB issued Interpretation No. 48, &#147;Accounting
for Uncertainty in Income Taxes&#148;, or FIN 48, an interpretation of SFAS No. 109,
&#147;Accounting for Income Taxes&#148;.  FIN 48 clarifies the accounting for uncertainty
in income taxes recognized in an enterprise&#146;s financial statements in
accordance with SFAS No. 109, and prescribes a recognition threshold and
measurement attribute for the financial statement recognition and measurement
of a tax position taken or expected to be taken in a tax return.  FIN 48 also
provides guidance on derecognition, classification, interest and penalties,
accounting in interim periods, disclosure and transition.  FIN 48 is effective
for our reporting period beginning January 1, 2007.  We are currently in the
process of determining the impact of the adoption of this Interpretation on our
consolidated financial statements.</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In September 2006, FASB issued SFAS No. 157, &#147;Fair
Value Measurements&#148;.  This statement applies whenever other standards require
(or permit) assets or liabilities to be measured at fair value. Under this statement,
fair value refers to the price that would be received to sell an asset or paid
to transfer a liability in an orderly transaction between market participants
in the market in which the reporting entity transacts.  This statement
clarifies the principle that fair value should be based on the assumptions
market participants would use when pricing the asset or liability.  In support
of this principle, the standard establishes a fair value hierarchy that
prioritizes the information used to develop those assumptions.  The fair value
hierarchy gives the highest priority to quoted prices in active markets and the
lowest priority to unobservable data, for example, the reporting entity&#146;s own
data.  Under this statement, fair value measurements would be separately
disclosed by level within the fair value hierarchy.  This statement will become
effective for financial statements issued for fiscal years beginning after
November 15, 2007, and with interim periods within those fiscal years.  Early
adoption is permitted.  We are currently in the process of evaluating the
impact of this statement on our consolidated financial statements. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;punctuation-wrap:hanging' style="margin-top:0;margin-bottom:0">In September 2006, the Emerging Issues Task Force, or
EITF, reached a consensus on Issue No. 06-1, &#147;Accounting for Consideration Given
by a Service Provider to Manufacturers or Resellers of Equipment Necessary for
an End-Customer to Receive Service from the Service Provider&#148;.  EITF Issue No.
06-1 provides guidance regarding whether the consideration given by a service
provider to a manufacturer or reseller of specialized equipment should be
characterized as a reduction of revenue or an expense.  This issue is effective
for our reporting period beginning January 1, 2008.  Entities are required to
recognize the effects of applying this issue as a change in accounting
principle through retrospective application to all prior periods unless it is
impracticable to do so.  We are currently in the process of evaluating the
impact of this issue on our consolidated financial statements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.5in;text-indent:-.5in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Cash
and Cash Equivalents</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:13.0pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.0pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.0pt'>
 <p align=right style='margin-right:4.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.0pt'>
 <p align=right style='margin-right:4.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash on hand and in banks</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,416</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,496</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Temporary investments</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>13,454</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">23,563</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>16,870</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30,059</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash in banks earns interest at prevailing bank
deposit rates.  Temporary cash investments are made for varying periods of up
to two months depending on our immediate cash requirements, and earn interest
at the prevailing short-term deposit rates.  Due to the short-term nature of
such transactions, the carrying value approximates the fair value of our
temporary cash investments.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.5in;text-indent:-.5in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Trade
and Other Receivables</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">This
account consists of receivables from:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:13.0pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.0pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.0pt'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.0pt'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Customers
 and carriers</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>25,293</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0">25,222</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,578</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0">1,159</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>26,871</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0">26,381</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Less allowance for doubtful
 accounts</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,713</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0">18,525</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,158</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.55pt;text-align:right' style="margin-top:0;margin-bottom:0">7,856</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Movements in the allowance for doubtful accounts are
as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:5.4pt;border-collapse:collapse;border-collapse:collapse !msorm'>
 <tr>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;border-top:solid windowtext 1.5pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;border-top:solid windowtext 1.5pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;border-top:solid windowtext 1.5pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt;border-top:solid windowtext 1.5pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt;
 border:none !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 padding:0in 5.4pt 0in 5.4pt;border:none !msorm;padding:0in 5.4pt 0in 5.4pt !msorm'>
 <p style=';page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='height:12.75pt' style='height:12.75pt !msorm'>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;height:12.75pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at beginning of year</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>18,525</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,070</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,307</p>
 </td>
 </tr>
 <tr style='height:12.75pt' style='height:12.75pt !msorm'>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;height:12.75pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for the year (Note 24)</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>736</b></p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,251</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt 0in 5.4pt 0in 5.4pt !msorm;height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,955</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Translation adjustments</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(28)</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(16)</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Reversals</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(654)</b></p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(11)</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Write-offs</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,866)</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,769)</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(192)</p>
 </td>
 </tr>
 <tr>
 <td  valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at end of year</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>16,713</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,525</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">18,070</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Receivables from carriers represent receivables
arising from interconnection agreements with other telecommunications
carriers.  The aforementioned amount of receivable is shown net of related
payable to the same telecommunications carriers because an established right of
offset exists.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Unbilled
receivables from customers and carriers of Php604 million and Php631 million in
2006 and 2005, respectively, represent recognized revenue for services rendered
to fixed line and wireless subscribers that have not been billed at the balance
sheet dates. The unbilled amounts are billed upon completion of the
corresponding subscribers&#146; billing cycles.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">On October 10, 2002, PLDT entered into a
Receivables Purchase Deed, or RPD, with a foreign financial institution, or the
Purchaser, under which PLDT agreed (1) to sell its receivables from certain
eligible foreign carriers for an advance payment of US$50 million, of which
US$3 million, or Php147 million, and US$20 million, or Php1,061 million, remained
outstanding as at December 31, 2006 and 2005, respectively, and (2) to service,
administer and collect the receivables on behalf of the Purchaser.  Under the
RPD, the Purchaser has no recourse against PLDT should an eligible carrier fail
or refuse to settle the assigned/purchased receivables, except when PLDT
commits a breach of its representations and warranties under the RPD.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Sale of receivables
under the RPD amounted to US$6 million (Php272 million) and US$11 million
(Php586 million) for the years ended December 31, 2006 and 2005, respectively.
Loss on sale of receivables under the RPD amounted to US$0.5 million (Php27
million) for the year ended December 31, 2006 and US$1 million (Php75 million)
for the years ended December 31, 2005 and 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.5in;text-indent:-.5in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Inventories
and Supplies</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:101.1%;margin-left:.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid;height:8.85pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=right style='margin-right:8.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Spare parts and supplies </p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,397</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,393</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Terminal and cellular phone units </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>719</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,002</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>161</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">255</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,277</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,650</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Less allowance for inventory
 obsolescence</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,047</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,102</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,230</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,548</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Movements
in the allowance for inventory obsolescence are as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:472.5pt;margin-left:5.4pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>
 <tr style='height:12.75pt'>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:12.75pt'>
 <p style="margin-top:0;margin-bottom:0">Balance at beginning of
 year</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,102</b></p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,134</p>
 </td>
 <td  valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt;
 height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">729</p>
 </td>
 </tr>
 <tr style='height:12.75pt'>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:12.75pt'>
 <p style="margin-top:0;margin-bottom:0">Provision for the year (Note
 24)</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>211</b></p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">479</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt;
 height:12.75pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">577</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Write-offs</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(266)</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(511)</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(172)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">Balance at end of year</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,047</b></p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,102</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,134</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Spare parts and supplies issued to various projects, included
as part of property under construction shown under <i>Note 7 &#150; Property, Plant
and Equipment</i>, amounted to Php2,928 million, Php1,970 million and Php2,277
million in 2006, 2005 and 2004, respectively.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.5in;text-indent:-.5in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Property,
Plant and Equipment</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:101.12%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:13.0pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.0pt'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.0pt'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:13.0pt'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:14.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cable and wire facilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>105,596</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100,756</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Central office equipment</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>77,575</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">73,473</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cellular facilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>59,680</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">57,985</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Vehicles, furniture and other work equipment</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>29,477</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">26,905</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Buildings</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>20,152</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">19,627</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Communications satellite</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>6,511</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8,628</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Information origination and termination equipment</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,921</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,890</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Land and land improvements</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,889</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,730</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>305,801</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">292,994</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Less accumulated depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>155,078</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">132,131</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>150,723</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">160,863</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Property under construction</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>13,358</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,144</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>164,081</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">173,007</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Interest
capitalized for the years ended December 31, 2006, 2005 and 2004 amounted to
Php549 million, Php504 million and Php595 million, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2006 and 2005, assets impaired consist of assets of wireless and information
and communications technology segments.  Assets impaired in 2004 consist of
assets of the wireless and fixed line segments.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2006, management believes that due to Mabuhay Satellite&#146;s difficulty in
generating cash flows with the satellite nearing its end-of-life and other
events affecting its business, Mabuhay Satellite&#146;s Agila II transponders is
considered impaired.  This impairment review is based on the net present value of
future cash flows from the continued use of the asset group using the discount
factor of 11%.  An impairment loss of Php1,391 million was charged to the
carrying value of this satellite as at December 31, 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2004, certain assets with net book values aggregating Php365 million were
impaired.  These assets relate primarily to certain international facility
equipment of PLDT Global and Subic Telecom in relation to our strategic
direction to functionally integrate our international fixed line business.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">When
impairment charges are recognized, a new cost basis for the assets is
established.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Property,
plant and equipment includes the following amounts for capitalized leases as at
December 31, 2006 and 2005:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:101.04%;margin-left:.4pt;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.95pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p style='line-height:80%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0"><b>Central
 office equipment</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0"><b>Vehicles,
 furniture and other work equipment</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 <p align=center style=';text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">Central
 office equipment</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">Vehicles,
 furniture and other work equipment</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=center style='margin-right:2.9pt;text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=center style=';text-align:center;
 line-height:80%' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.95pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.95pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=9 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Cost</p>
 </td>
 <td   style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.45pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>455</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,082</b></p>
 </td>
 <td   colspan=2 valign=top style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.05pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,537</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.05pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:13.45pt;text-align:right' style="margin-top:0;margin-bottom:0">361</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">1,039</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">1,400</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Less
 accumulated depreciation</p>
 </td>
 <td   style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.45pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>352</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>908</b></p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.05pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,260</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.05pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.45pt;text-align:right' style="margin-top:0;margin-bottom:0">293</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">719</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0">1,012</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.45pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 103</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 174</b></p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.05pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 277</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.05pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.45pt;text-align:right' style="margin-top:0;margin-bottom:0">  68</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"> 320</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.2in;text-align:right' style="margin-top:0;margin-bottom:0"> 388</p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Depreciation
expense for assets reported under capitalized leases amounted to Php284 million,
Php333 million and Php282 million in 2006, 2005 and 2004, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In 2006, 2005 and 2004, we changed the estimated
useful lives of certain network assets owing to continuing network expansion
and upgrade.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Below
is the pro forma financial information assuming no changes in accounting
estimates:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:97.72%;margin-left:5.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos, except per share amounts)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Consolidated net
 income</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">As
 reported</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>33,598</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Pro
 forma</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>39,203</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">45,872</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">30,319</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Earnings per common share &#150; basic</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">As
 reported</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>174.90</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">217.84</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">146.32</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Pro
 forma</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>205.29</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">248.46</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">159.38</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Earnings per common share &#150; diluted</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">As
 reported</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>174.90</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">211.93</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">145.30</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Pro
 forma</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>205.29</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">240.72</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">157.55</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Under the terms of certain loan agreements, PLDT may
not create, incur, assume, permit or suffer to exist any mortgage, pledge, lien
or other encumbrance or security interest over the whole or any part of its
assets or revenues or suffer to exist any obligation as lessee for the rental
or hire of real or personal property in connection with any sale and leaseback
transaction.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-left:.5in;text-indent:-.5in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Investments</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">This
account consists of:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse;width:100.0% !msorm;border-collapse:
 collapse !msorm'>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0">(in million
 pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Investments in shares of
 stock:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Acquisition
 cost</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,908</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">3,409</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Less
 accumulated equity share in net losses</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,271</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">3,394</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 637</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">  15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">At
 equity:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Philweb
 Corporation</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>613</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">ePDS,
 Inc.</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>24</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Mabuhay
 Space Holdings Limited</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">BayanTrade
 Dotcom, Inc.</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">ACeS
 International Limited</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 637</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">  15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">At
 cost:</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Stradcom
 International Holdings, Inc.</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 637</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">  15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Investments in debt
 security</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0">346</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 637</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.65pt;text-align:right' style="margin-top:0;margin-bottom:0"> 361</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><a name="OLE_LINK40"></a><a name="OLE_LINK39"><b><i>Investment of ePLDT in Philweb Corporation, or Philweb</i></b></a></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
May 2006, ePLDT subscribed to newly issued common shares of Philweb, an
internet-based gaming company, equivalent to 20% of the total outstanding
capital stock of Philweb at a price of Php0.020 per share or an aggregate
amount of Php502 million.  Of the total subscription price, Php427 million was
paid by ePLDT on the closing date.  The portion of the unpaid subscription
price amounting to Php25 million will be paid by ePLDT at the same time as the
Philweb majority stockholders pay the remaining unpaid portion of the
subscription pursuant to a general call on subscription to be made by Philweb&#146;s
board of directors.  The balance of Php50 million will be paid upon the lapse
of certain post-closing price adjustment periods.  The unpaid subscription of
Php75 million was recorded as part of accrued
expenses and other current liabilities in the balance sheet.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
October 2006, ePLDT acquired an additional 8,037,692,308 shares of Philweb at a
price of Php0.026 per share or an aggregate amount of Php209 million.  This
represents an additional 6.2% of the outstanding shares of Philweb, raising
ePLDT&#146;s total equity stake to 25.5% as at December 31, 2006.  Total equity
share in net loss of Philweb recognized in the statements of income for the
year ended December 31, 2006 amounted to Php97 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-right:1.8pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">Philweb is primarily engaged in internet-based gaming,
through its appointment as Principal Technology Service Provider under the
Marketing Consultancy Agreement for Internet Sports Betting and Internet Casino
with the Philippine Amusement and Gaming Corporation, or PAGCOR.  As of the end
of December 2006, Philweb offers Internet Sports Betting in over 230 PAGCOR
Internet Sports Betting Stations and over 40 Internet Casino Stations
nationwide.  As at December 31, 2006, the
market value of ePLDT&#146;s investments in Philweb amounted to Php1,028 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Investment of ePLDT in
ePDS, Inc., or ePDS</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
June 30, 2003, ePLDT signed a joint venture agreement with DataPost Pte Ltd.,
or DataPost, a subsidiary of Singapore Post, and G3 Worldwide ASPAC, or Spring,
pursuant to which the parties formed ePDS, a bills printing company which does
laser printing and enveloping services for statements, bills and invoices, and
other value-added services for companies in the Philippines.  ePLDT has a 50%
interest in ePDS, while DataPost has a 30% interest.  Spring, the largest
international mail services provider, owns the remaining 20%.  ePDS has an
initial paid-up capital of Php11 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-right:1.8pt;text-indent:.5in' style="margin-top:0;margin-bottom:0">In October 2005, ePDS&#146; Board of Directors approved the
declaration of a 100% stock dividend on its common stock equivalent to Php11
million.  The stock dividends were issued from the increase in authorized
capital stock of ePDS which was approved by the Philippine SEC in June 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Investment of Mabuhay Satellite in Mabuhay Space Holdings, Limited, orMSHL</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In 1996, Mabuhay Satellite entered into a Joint
Venture Agreement, or JVA, with Space Systems/Loral Inc., or SS/L, to form MSHL
for the purpose of providing high-power Ku-Band satellite transmission services
using the payload which was added by SS/L to the Agila II Satellite.  Under the
terms of the JVA, SS/L is required to convey title to the additional payload
service to MSHL in consideration for SS/L&#146;s 35% equity interest in MSHL, and
Mabuhay Satellite is required to pay SS/L US$19 million for a 65% equity
interest in MSHL.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2000, SS/L filed a Notice of Default and Termination against Mabuhay Satellite
arising from the latter&#146;s alleged failure to amicably resolve its unpaid
obligation to SS/L under the JVA.  In 2002, the arbitration panel handed down
its decision and provided for payment by Mabuhay Satellite to SS/L of the
principal amount of US$10 million plus accrued interest at 9% per annum.  On
June 30, 2003, Mabuhay Satellite and SS/L concluded a US$15 million settlement
agreement under which Mabuhay Satellite leased two transponders under a
transponder agreement on a life-term basis to SS/L and offset the lease charges
due from SS/L and its receivables from Loral Skynet Network Services, Inc.
(formerly known as the Loral Cyberstar, Inc.), among other things, for a full
and final settlement of the arbitration decision.  The agreement was
subsequently approved by Mabuhay Satellite&#146;s creditors in March 2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">In accordance with the settlement agreement, Mabuhay
Satellite and SS/L shall proceed to dissolve the joint venture under a separate
agreement, for which each of the parties will receive title over a number of
transponders owned by the joint venture in proportion to their respective
interests.  On the basis of the joint venture dissolution, we recognized an
impairment provision in respect of our investment in MSHL of Php431 million in
2004.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Investment of ePLDT in BayanTrade Dotcom, Inc., or BayanTrade</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">BayanTrade was incorporated and registered with the
SEC on August 8, 2000 to provide:  (a) a business-to-business electronic
purchasing marketplace to link buyers and suppliers of goods services over the
Internet; <br>
(b) electronic catalogue purchasing facilities over the Internet to buyers and
suppliers; (c) link-up with similar horizontal markets and vertical markets
across the Asia-Pacific Region and the world; and (d) facilitating services
incidental to the business.  BayanTrade is an e-procurement joint venture
established together with six of the Philippines&#146; leading conglomerates.
ePLDT&#146;s initial shareholding in BayanTrade was 20.5%, which was subsequently
diluted to 19.17% in August 2004 due to an equity call to which ePLDT did not
subscribe.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
September 2005, ePLDT received 4,794,615 bonus warrants from BayanTrade which
entitles ePLDT to purchase 2,794,615 common shares at a price of Php0.50 per
share at any time on or before August 31, 2010.  We did not account for the
value of bonus warrants because the value is not material.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Investment of ACeS Philippines in ACeS International Limited, or AIL</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006 and as at the date of this report, ACeS Philippines had a
20% and 36.99%, respectively, investment in AIL, a company incorporated under
the laws of Bermuda.  AIL owns the Garuda I Satellite and the related system
control equipment in Batam, Indonesia.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">AIL has incurred recurring significant operating
losses, negative operating cash flows, and significant levels of debt.  The
financial condition of AIL was partly due to the National Service Providers&#146;,
or NSPs, inability to generate the amount of revenues originally expected as
the growth in subscriber numbers has been significantly lower than budgeted.
These factors raised substantial doubt about AIL&#146;s ability to continue as a
going concern.  On this basis, we recognized a full impairment provision in
respect of our investment in AIL amounting to Php1,614
million in 2003.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">For
further details as to the contractual relationships in respect of AIL, see <i>Note
16 &#150; Related Party Transactions</i>.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Investm</i></b><b><i>ent in
Stradcom Int&#146;l. Holdings, Inc., or SIHI</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">ePLDT has a 22.5% interest in convertible
securities of SIHI, the parent company of Stradcom Corporation, which has an
existing concession agreement with the Philippine Government for the
modernization of the Philippine Land Transportation Office, including the
computerization of driver&#146;s license issuance, vehicle registration and traffic
adjudication systems.  SIHI has been incurring losses from the start of
operations due to Stradcom Corporation&#146;s continuous losses and recurring excess
of current liabilities over current assets.  On this basis, we recognized an
impairment provision in respect of our total investment in SIHI of Php616
million in 2004.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Stradcom
Corporation is currently undertaking the issuance of Asset-Backed Bonds
amounting to Php1.6 billion intended for debt refinancing and general corporate
purposes, including working capital and investments.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-right:1.8pt' style="margin-top:0;margin-bottom:0"><b><i>Summarized Financial Information of Equity Investees</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-right:1.8pt;text-indent:35.45pt' style="margin-top:0;margin-bottom:0">The following table presents summarized financial
information in conformity with U.S. GAAP for equity investees for which we have
significant influence as at December 31, 2006 and 2005 and for the years ended
December 31, 2006, 2005 and 2004.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:472.9pt;;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:.25in;text-align:right;
 text-indent:-.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=2 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Current assets</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,122</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">652</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Noncurrent assets</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,333</b></p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,388</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Current liabilities</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,044</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,585</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Noncurrent liabilities</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>10,029</b></p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,242</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Capital deficiency</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>9,618</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,787</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-right:1.8pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:472.9pt;;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 background:white;padding:0in 0in 0in 0in'>
 <p align=left style='text-align:left;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:white;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:white;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:white;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=top style=' border:none;padding:
 0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">
 (in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=left style='text-align:left;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Revenues</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,194</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">774</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,299</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Revenues less cost of revenues</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>654</b></p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">615</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,013</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Expenses</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,066</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">472</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">592</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net income (loss)</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.05pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(412)</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">471</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:3.05pt;text-align:right' style="margin-top:0;margin-bottom:0">(19)</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-right:1.8pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Investment of ePLDT in
Debt Securities of Technology Support Services, Inc., or TSSI (formerly First
Advance Multi-Media Entertainment Corp., or FAME)</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On June 1, 2004, ePLDT and FAME entered into an
agreement whereby ePLDT granted a seven-year zero-coupon loan to FAME amounting
to US$3.1 million.  Based on agreement, upon maturity of the loan, which is at
the end of seven years from issuance, ePLDT may require FAME to redeem or pay
the loan at a redemption value amounting to US$6.1 million.  At any time during
the life of the outstanding loan, ePLDT may convert the loan into 20% of the
total outstanding capital stock of FAME.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
August 20, 2004, FAME changed its corporate name to TSSI.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On September 14, 2004, ePLDT entered into a second
agreement with TSSI whereby ePLDT granted another seven-year zero coupon loan
to TSSI amounting to US$3.1 million with the same terms and features as the
first loan.  As at December 31, 2006, the aggregate loans of ePLDT to TSSI
amounted to US$6.2 million.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">TSSI
has been incurring losses from the start of operations due to delays in its
projects.  On this basis, we recognized a full impairment provision in respect
of our notes receivable from TSSI amounting to Php346 million in 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

</div>

<p style='margin-left:.5in;text-indent:-.5in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
</b><b>Goodwill
and Other Intangible Assets</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:35.45pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p align=right style='text-align:right;text-indent:.5in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.72%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:12.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Goodwill</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>33,349</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24,419</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other intangible assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,632</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,779</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>38,981</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">28,198</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Less accumulated amortization</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>11,740</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,323</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.6pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:7.6pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>27,241</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:7.6pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,875</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Movements
in accumulated amortization of goodwill and other intangible assets are as
follows:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.84%;border-collapse:collapse;width:100.84% !msorm;border-collapse:
 collapse !msorm'>
 <tr style='page-break-inside:avoid;height:15.45pt' style='page-break-inside:
 avoid !msorm;height:15.45pt !msorm'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;background:white;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:15.45pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:white;padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm;height:15.45pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:white;padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm;height:15.45pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:white;padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm;height:15.45pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.45pt' style='page-break-inside:
 avoid !msorm;height:12.45pt !msorm'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;border-top:
 solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;height:12.45pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:12.45pt'>
 <p style="margin-top:0;margin-bottom:0">                (in million
 pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.0pt' style='page-break-inside:
 avoid !msorm;height:12.0pt !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.0pt'>
 <p style="margin-top:0;margin-bottom:0">Balance at beginning of
 year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.0pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>11,323</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.0pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0">11,134</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.0pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0">11,041</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.0pt' style='page-break-inside:
 avoid !msorm;height:12.0pt !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.0pt'>
 <p style="margin-top:0;margin-bottom:0">Amortization during the
 year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.0pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>402</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.0pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0">204</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.0pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0">93</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.0pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p style="margin-top:0;margin-bottom:0">Translation adjustments
 (Note 18)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>15</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.35pt'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:11.35pt'>
 <p style="margin-top:0;margin-bottom:0">Balance at end of year</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:11.35pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>11,740</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:11.35pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0">11,323</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:11.35pt'>
 <p align=right style='margin-right:6.55pt;text-align:right' style="margin-top:0;margin-bottom:0">11,134</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Movements of the net carrying value of goodwill per
reportable segments are as follows:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.48%;margin-left:.4pt;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Wireless</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Fixed Line</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Information and Communications
 Technology</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:31.5pt;text-align:center;
 text-indent:49.45pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balances as at December 31, 2003</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,941</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">426</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">97</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,464</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Additions during the year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,019</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">90</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,109</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Reclassification during the year</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(173)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(173)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balances as at December 31, 2004</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,787</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 426</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 187</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,400</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Additions during the year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">133</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 145</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Reclassification during the year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(448)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(448)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Impairment during the year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(15)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balances as at December 31, 2005</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,472</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 426</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 184</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,082</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Additions during the year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">974</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8,260</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,234</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Translation adjustments during the year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(303)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(303)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Balances as at December 31, 2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>16,446</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 426</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>8,141</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>25,013</b></p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">A substantial portion of goodwill is related to the
wireless business segment due to our acquisition of Smart and Smart Broadband
and to the information and communication technology business segment due to our
acquisition of SPi and its subsidiary, CyMed.  We have completed our annual
evaluation of the goodwill value in conformity with SFAS No. 142 and consistent
with our increase in wireless and information and communications technology revenues,
there is no impairment in the value of goodwill.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">On
September 2, 2004, Smart entered into a sale and purchase agreement to acquire
100% of Smart Broadband, a company primarily engaged in providing wireless
broadband and data services to small and medium-scale enterprises in the
Philippines, for a total consideration of US$45 million, of which payments of
US$11 million and US$7 million for an equity interest of 40% in Smart Broadband
were made in 2004 and payment of US$4 million for an additional equity interest
of 9% was made in January 2005.  The balance of US$23 million, or Php1,201
million, in respect of the remaining 51% equity interest in Smart Broadband was
paid on March 7, 2006.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
purchase consideration for the acquisition of the remaining 51% stake in Smart
Broadband has been allocated to the assets and liabilities on the basis of fair
values at the date of acquisition.  The fair values of the identifiable
acquired assets and liabilities of Smart Broadband at the time of acquisition
of the remaining 51% stake in 2006 are as follows:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.72%;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Cash and cash
 equivalents</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">124</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Trade and other
 receivables</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Inventories and
 supplies</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Prepaid expenses and other
 current assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">75</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Property, plant and
 equipment</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">601</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Goodwill</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">974</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Intangible assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">428</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">2,219</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Accrued expenses and other
 current liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">881</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Deferred income tax liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">137</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">1,018</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Net assets acquired</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">1,201</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Smart&#146;s 20% Acquisition of Wolfpac</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On May 8, 2006, Smart signed a share purchase
agreement to acquire the remaining 20% equity interest in Wolfpac, a company
engaged in the business of consumer mobile applications software development
and content development.  Smart acquired an 80% equity interest in Wolfpac in
October 2003.  The remaining 20% equity interest in Wolfpac was acquired in
July 2006 for Php30 million.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>ePLDT&#146;s Acquisition of
Level Up!</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
February 16, 2006, ePLDT entered into a sale and purchase agreement to acquire
60% equity interest of Level Up!, a leading publisher of online games in the Philippines, for a total consideration of Php383 million.  Post-closing conditions were
completed on April 30, 2006.  In August 2006, the Shareholders Agreement and
Share Purchase Agreement between ePLDT and Level Up! were amended to reflect
the removal of earn-out and price adjustment provisions thereby fixing the
acquisition for 60% of Level Up! at the aforementioned original purchase price
of US$7 million.  As at purchase date, the net cash outflow related to the
acquisition was Php348 million, representing cash payments of Php383 million,
net of cash acquired from Level Up! of Php35 million.  Total cash payments
include a purchase price consideration of Php381 million and incidental cost of
Php2 million.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The purchase consideration has been allocated to the
assets and liabilities on the basis of fair values at the date of acquisition.
The fair values of the identifiable acquired assets and liabilities of Level
Up! as at April 30, 2006, are as follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Cash and cash
 equivalents</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">35</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Trade and other
 receivables</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Inventories and
 supplies</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Prepaid expenses and other
 current assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">20</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Property, plant and
 equipment</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">129</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Goodwill</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">358</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Intangible assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">111</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Other noncurrent
 assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">704</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Accounts payable</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">148</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Accrued expenses and other
 current liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Unearned revenues</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Deferred income tax liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Capital lease liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">48</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">321</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Net assets acquired</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right' style="margin-top:0;margin-bottom:0">383</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Intangible
assets, as determined by an independent appraiser, pertains to Level Up!&#146;s game
license agreements for Ragnarok, ROSE Online, RF Online and Freestyle amounted
to Php111 million with an estimated remaining useful life of 5.67 years.  Level
Up! was accounted for in the consolidated financial statements using the
purchase method of accounting, which resulted in goodwill amounting to Php358
million in 2006.  Goodwill pertains to the assembled workforce and other
unidentified intangible assets that did not qualify as intangible assets under
SFAS No. 142.  As at December 2006, ePLDT has provided impairment in value of
its intangible assets in Level Up! amounting to Php30 million, representing a
write-down of such intangible assets to recoverable amounts using the market
value approach.  The impairment was a result of projected decline on revenues
related to certain license agreements.  Market value was based on the
discounted cash flow projections using the most recent financial forecast
approved by our management.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>ePLDT&#146;s Acquisition of SPi</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On July 11, 2006, ePLDT entered into a sale and
purchase agreement to acquire 100% equity interest of SPi and its direct and
indirect Philippine and offshore subsidiaries for a total cash consideration of
US$135 million.  As part of the transaction, ePLDT also acquired a US$7 million
debt owed by SPi to the seller at face value.  In addition, ePLDT advanced
US$16 million to SPi in order for SPi to fully pay its debt owed to DBS Bank Singapore.  As at December 31, 2006, the net cash outflow related to the acquisition was
Php7,028 million, representing cash payments of Php7,114 million, net of cash
acquired from SPi of Php86 million.  Total cash payments include a purchase
price consideration of Php7,024 million and incidental cost of Php90 million.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The purchase consideration has been allocated to the
assets and liabilities on the basis of fair values at the date of acquisition.
The fair values of the identifiable acquired assets and liabilities of SPi at
the time of acquisition are as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center' style="margin-top:0;margin-bottom:0">In U.S. Dollar</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center' style="margin-top:0;margin-bottom:0">In Php Equivalent(1)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Cash and cash
 equivalents</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">86</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Trade and other
 receivables</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">1,915</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Prepaid expenses and other
 current assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">96</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Property, plant and
 equipment</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">1,019</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Goodwill</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">130</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">6,906</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Intangible assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">972</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Other noncurrent
 assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">208</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">11,045</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Accounts payable</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">2,942</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Accrued expenses and other
 current liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">412</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Deferred income tax
 liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">395</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Other noncurrent liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">182</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">72</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:solid windowtext 1.0pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">3,931</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Net assets acquired</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right' style="margin-top:0;margin-bottom:0">136</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right' style="margin-top:0;margin-bottom:0">7,114</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>(1)</i><i>    Converted to Philippine Peso using the exchange
rate at the time of purchase of Php</i><i>53.11</i><i> to US$1.00</i><i>.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Intangible
assets, as determined by an independent appraiser, amounted to Php972 million
relating to SPi&#146;s customer relationships and self-developed software with
estimated remaining useful lives of seven and four years, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">SPi was accounted for in the consolidated financial
statements using the purchase method of accounting, which resulted in goodwill
amounting to Php6,906 million.  Goodwill pertains to the assembled workforce of
SPi and other unidentified intangible assets that did not qualify as intangible
assets under SFAS No. 142.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>ePLDT&#146;s Acquisition of CyMed</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On August 11, 2006, ePLDT, through its direct
subsidiary SPi, entered into a sale and purchase agreement to acquire 100%
equity interest of CyMed for an aggregate purchase price of US$37 million,
inclusive of certain debt obligations.  As at August 15, 2006, the net cash
outflow related on acquisition was Php1,774 million, representing cash payments
of Php1,831 million, net of cash acquired from CyMed of Php57 million.  Total
cash payments include a purchase price consideration of Php1,716 million,
working capital amounts and other net debt adjustments totaling Php102 million
and incidental cost of Php13 million.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
purchase consideration has been allocated to the assets and liabilities on the
basis of fair values at the date of acquisition.  The fair values of the
identifiable acquired assets and liabilities of CyMed at the time of
acquisition are as follows:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">In U.S. Dollar</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">In Php Equivalent(1)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash and cash equivalents</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Trade and other receivables</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">168</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Notes receivable</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">87</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Prepaid expenses and other current assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">20</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Property, plant and equipment</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">39</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Goodwill</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">27</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,334</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Intangible assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">228</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Deferred income tax assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">30</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-right:44.95pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,963</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accounts payable and other current liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">72</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest-bearing financial liabilities &#150; net of
 current portion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">60</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">132</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net assets acquired</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:44.95pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:40.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,831</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>(1)</i><i>    Converted to Philippine Peso using the exchange
rate at the time of purchase of Php49.03</i><i> to US$1.00</i><i>.</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">CyMed
was accounted for in the consolidated financial statements using the purchase
method of accounting, which resulted in goodwill amounting to Php1,334
million.  Goodwill pertains to assembled workforce of CyMed and other
unidentified intangible assets that did not qualify as intangible assets under SFAS
No. 142.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Intangible assets pertaining to CyMed&#146;s customer
relationship was determined at Php336 million with an estimated useful life of
five years.  Intangible assets was valued by an independent appraiser.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The following unaudited pro forma consolidated
financial information reflects the results of our operations for the years
ended December 31, 2006, 2005 and 2004, as if the acquisition of Level Up!, SPi
and CyMed had occurred on January 1, 2004.  These unaudited pro forma results
have been prepared for comparative purposes only, do not purport to be
indicative of what the operating results of Level Up!, SPi and CyMed would have
been had the acquisition actually taken place on January 1, 2004 and may not be
indicative of future operating results.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:97.72%;margin-left:5.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:35.15pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos, except per share amounts)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Operating revenues</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">As
 reported</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>127,536</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">123,335</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">121,173</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Pro
 forma</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>130,082</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">128,174</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">124,451</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Consolidated net
 income</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">As
 reported</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>33,598</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Pro
 forma</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>33,170</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">38,945</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">26,890</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Earnings per common share &#150; basic</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">As
 reported</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>174.90</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">217.84</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">146.32</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Pro
 forma</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>172.58</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">208.20</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">139.18</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Earnings per common share &#150; diluted</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">As
 reported</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>174.90</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">211.93</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">145.30</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Pro
 forma</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>172.58</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">202.87</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.5pt;text-align:right' style="margin-top:0;margin-bottom:0">138.61</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other intangible assets consist of:</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.36%;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:27.7pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:29.9pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Gross</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Net</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Gross</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style=';text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Estimated <br>
 Useful Lives</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Carrying Amount</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Accumulated Amortization</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Carrying Amount</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accumulated Amortization</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=7 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Customer list</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1 &#150; 7 years</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:9.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,931</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,819</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,112</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,758</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,728</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:10.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">  30</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Spectrum</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15 years</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:9.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>899</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>106</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 793</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">591</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">50</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:10.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 541</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Technology application</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4 years</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:9.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>587</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>454</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 133</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">365</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">204</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:10.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 161</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Licenses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5 &#150; 17 years</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:9.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>215</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>25</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 190</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">66</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:10.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">  61</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-right:17.45pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,632</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,404</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,228</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,780</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,987</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:10.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 793</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
future amortization of other intangible assets as at December 31, 2006 are as
follows:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.72%;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">362</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">337</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">287</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2010</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">280</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2011</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">211</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2012 and onwards</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">751</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at end of year</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:56.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,228</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>10.    Other Noncurrent Assets</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.72%;border-collapse:collapse;width:100.72% !msorm;border-collapse:
 collapse !msorm'>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:12.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Telephone instruments &#150; net</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,114</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,420</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Refundable deposits</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>512</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">516</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Debt issuance costs &#150; net</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>401</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">750</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>603</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">778</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.2pt' style='page-break-inside:
 avoid !msorm;height:11.2pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm;height:11.2pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm;height:11.2pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,630</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 2.25pt !msorm;padding:
 0in 0in 0in 0in !msorm;height:11.2pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,464</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>11.    Accrued Expenses and Other Current
Liabilities</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.72%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='height:6.2pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:6.2pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:6.2pt'>
 <p align=right style='margin-right:12.35pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accrued utilities and related expenses (Note
 16)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>8,009</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,559</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accrued employee benefits (Note 17)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,474</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,760</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accrued satellite air time cost and provisions
 (Notes 16, 21 and 22)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,437</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,901</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accrued interests and other related
 costs (Note 12)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,764</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,003</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accrued taxes and related expenses (Note 22)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>756</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">760</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,084</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,003</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.55pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:7.55pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:7.55pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>23,524</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:7.55pt'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15,986</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Over
the past years, PLDT has been implementing its manpower rightsizing program, or
MRP, in line with its continuing effort to reduce the cost base of its fixed
line business.  The MRP cost charged to operations for the years ended December
31, 2006, 2005 and 2004 amounted to Php445
million, Php458 million and Php566
million, respectively, determined in accordance with SFAS No. 146, &#147;Accounting
for Costs Associated with Exit or Disposal Activities&#148;.  The decision to
implement the MRP was anchored on the challenges being faced by the fixed line
business as significant changes in technology, increasing competition, and
shifting market preferences to cellular use have reshaped the future of the
fixed line business.  The MRP was implemented under the Labor Code of the Philippines, as amended, and is in compliance with all other relevant labor laws and regulations in
the Philippines.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Movements
in the accrued MRP cost accounts, included under accrual for payment for unused
sick leave and other employee benefits during the years, are as follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.84%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.45pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:8.45pt'>
 <p align=center style='margin-right:2.2pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">                  (in
 million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Balance at beginning of year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>25</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">48</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cost for the year (Notes 18 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>445</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">458</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">566</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Payments</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(279)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(481)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(534)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Balance at end of year</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 191</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">  25</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">  48</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">12.    Interest-bearing Financial Liabilities</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">This
account consists of the following:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.72%;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:12.35pt;text-align:right' style="margin-top:0;margin-bottom:0">(in million
 pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Current portion of interest-bearing
 financial liabilities:</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Long-term
 debt maturing within one year (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,316</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">18,797</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Obligations
 under capital lease maturing within one year (Notes 7 and 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>924</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">753</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Notes
 payable</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>201</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>17,441</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">19,550</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:8.0pt'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Long-term portion of interest-bearing financial
 liabilities - <br>
 net of current portion:</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:8.0pt'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Long-term
 debt (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>69,542</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">93,516</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.0pt'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Obligations
 under capital lease (Notes 7 and 23)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>106</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">344</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>69,648</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p align=right style='margin-right:7.75pt;text-align:right' style="margin-top:0;margin-bottom:0">93,860</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Long-term Debt</i></b></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Long-term
debt consists of:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.86%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Description</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Interest Rates</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><i>U.S.
 Dollar Debt:</i></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-align:justify' style="margin-top:0;margin-bottom:0">Export Credit Agencies-Supported Loans:</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Kreditanstalt f&#252;r Wiederaufbau, or KfW</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">5.65%
 - 7.58% and US$ LIBOR + 0.55% - 2.5% in 2006 and 5.65% - 8.03% and US$ LIBOR
 + 0.55% - 2.5% in 2005</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$201</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php9,877</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$254</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php13,489</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Finnvera,
 plc, or Finnvera</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">7.53%
 - 7.75% and US$ LIBOR + 0.05% in 2006 and 6.36% - 7.75% and US$ LIBOR + 0.05%
 - 1.425% in 2005</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>70</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,433</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">107</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,651</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:19.35pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:19.35pt'>
 <p style='margin-left:27.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Nippon Export and Investment Insurance <br>
 of Japan, or NEXI</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:19.35pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">US$
 LIBOR + 1% in 2006 and <br>
 in 2005</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:19.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$25</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:19.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php1,226</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:19.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$50</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in;
 height:19.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php2,653</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">5.83%
 - 6.60% and US$ LIBOR + 0.15% - 1.60% and GOVCO&#146;s cost + 0.20% in 2006 and
 5.83% - 7.89% and US$ LIBOR + 0.15% - <br>
 4.3% in 2005</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>11</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>508</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">28</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,478</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 307</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,044</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 439</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">23,271</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Fixed
 Rate Notes</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">7.85%
 - 11.375% in 2006 and 2005</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>845</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>41,463</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">998</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">52,980</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Term Loans:</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:17.6pt' style="margin-top:0;margin-bottom:0">Debt
 Exchange Facility</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">2.25%
 and US$ LIBOR + 1% <br>
 in 2006 and 2005</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>283</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>13,892</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">283</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,030</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:17.6pt' style="margin-top:0;margin-bottom:0">GSM
 Network Expansion Facilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">4.49%
 - 4.70%, US$ LIBOR <br>
 + 0.815% - 3.25% in 2006 and 4.49% and US$ LIBOR + 3.25% in 2005</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>195</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>9,568</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">87</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,632</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:17.6pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">US$
 LIBOR + 0.40% - 3.625% and 1.75% - 10% in 2006 and US$ LIBOR + 0.40% - 3.625%
 and 1.75% in 2005</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>11</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>487</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">19</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">978</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Restructured
 Loans</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">US$
 LIBOR + 1% in 2006 <br>
 and 2005</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">119</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,305</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Satellite
 Acquisition Loans</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">5.66%
 and US$ LIBOR + 1.75% - 2.75% in 2006 and 5.66% and US$ LIBOR + 1.75% in 2005</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>42</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,083</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,040</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$</b><b>1,683</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>82,537</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$2,002</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">106,236</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><i>Japanese
 Yen Debt:</i></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">JBIC&#146;s Overseas Investment Loan, or OIL</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">2.125%
 in 2006 and 2005</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>JP&yen;&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">JP&yen;6,970</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,139</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Export Credit Agency-Supported Loan:  <br>
 NEXI Supported Loan</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">JP&yen;
 LIBOR + 1.70% in 2006 and 2005</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,575</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">710</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>JP&yen;</b><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">JP&yen;8,545</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,849</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><i>Philippine
 Peso Debt:</i></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Peso Fixed Rate Corporate Notes</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">15%
 - 15.816% in 2006 and 14% - 15.816% in 2005</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>810</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,580</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Term Loans:</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:17.6pt;text-align:justify' style="margin-top:0;margin-bottom:0">Secured Term Loans</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">24%
 - 28% and 90-day PHIBOR <br>
 + 3% in 2006 and 24% and 90-day PHIBOR + 3% in 2005</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>11</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">166</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:17.6pt;text-align:justify' style="margin-top:0;margin-bottom:0">Other Unsecured Term Loans</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">MART1
 + 0.75% in 2006</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,500</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Restructured Loans</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">91-day
 T-Bill rate + 1% in 2006<br>
 and 2005</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">482</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,321</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,228</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>85,858</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">112,313</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Less
 current portion</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,316</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,797</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;punctuation-wrap:
 hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">Long-term debt - net of
 current portion</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php69,542</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php93,516</p>
 </td>
 </tr>
</table></center></div>

<p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The scheduled maturities of our outstanding
consolidated long-term debt as at December 31, 2006 are as follows:</p>

<p align=right style='margin-left:.25in;text-align:right;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse;width:100.96% !msorm;border-collapse:
 collapse !msorm'>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.5pt !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:7.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>U.S. Dollar Loans</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:.25pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Php Loans</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:7.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:.05pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In U.S. Dollar</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:4.65pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>In Php</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:7.75pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">327</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,027</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">289</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">16,316</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">147</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,203</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">556</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,759</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">294</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,423</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">555</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,978</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2010</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">71</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,468</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,366</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,834</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2011</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">724</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">555</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,279</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2012 and onwards</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">829</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,692</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">40,692</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,683</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">82,537</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:27.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,321</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">85,858</p>
 </td>
 </tr>
</table></center></div>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>U.S. Dollar Debt:</u></i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Export Credit Agencies-Supported Loans</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In order to obtain imported components for our network
infrastructure in connection with our expansion and service improvement
programs, we obtained loans extended and/or guaranteed by various export credit
agencies.  These financings account for a significant portion of our
indebtedness.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Kreditanstalt f&#252;r Wiederaufbau, or KfW</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">KfW, a German state-owned development bank, is PLDT&#146;s
largest single creditor.  As at December 31, 2006, we owed US$201 million in aggregate
principal amount to KfW, as follows:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><u>&nbsp;</u></p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
US$153 million provided under
various export credit agency-backed facilities, of which US$43 million was in
connection with our expansion and service improvement programs, and US$110
million in connection with the US$149 million refinancing facility discussed
below; and</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
US$48 million provided for the 15%
downpayment portion and credit facilities without guarantee/insurance cover
from the export credit agencies, of which US$30 million was in connection with
the US$149 million refinancing facility discussed in the following paragraphs.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On January 25, 2002, PLDT signed two loan agreements
with KfW, which provided PLDT with a US$149 million facility to refinance in
part the repayment installments under its existing loans from KfW due from
January 2002 to December 2004.  The facility is composed of a nine-year loan,
inclusive of a three-year disbursement period and a two-year grace period
during which no principal is payable.  It partly enjoys the guarantee of
HERMES, the export credit agency of the Federal Republic of Germany.  We have
drawn US$140 million (Php6,864 million) under this facility as at December 31,
2006.  PLDT waived further disbursements under this refinancing facility
effective September 1, 2004.  Thus, the undrawn portion of US$9 million was
cancelled.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Of
the amounts outstanding under these KfW loans, US$37 million matured and was
paid on various dates between January 2, 2007 and June 4, 2007, US$35 million
will mature on various dates between July 2, 2007 and December 4, 2007, US$55
million will mature in 2008, US$43 million will mature in 2009 and US$31
million will mature in 2010.  Principal amortizations on these loans are
generally payable in equal semi-annual installments.</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Finnvera,
plc, or Finnvera</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, US$70 million, or Php3,433 million, principal amount of
Smart&#146;s debt was provided by various banks under an export credit agency-backed
facility in connection with Smart&#146;s GSM expansion program.  This facility is
covered by a guaranty from Finnvera, the Finnish Export Credit Agency, for 100%
of political and commercial risk for the refinancing facility of GSM Phases 5A
and 5B.  This is the only remaining outstanding facility guaranteed by
Finnvera.  Other Finnvera-guaranteed GSM loan facilities were already fully paid
in the aggregate amount of US$16.5 million for GSM Phases 3 and 4 loan
facilities on April 28, 2006, and in the aggregate amount of US$5.8 million for
GSM Phases 1 and 2 loan facilities on October 31, 2005.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">A US$100
million refinancing facility was obtained on February 11, 2005 in relation to
Smart&#146;s GSM Phases 5A and 5B loans which were prepaid on March 1, 2005 with
outstanding balances of US$60 million and US$41 million, respectively, at the
time of prepayment.  This refinancing facility is payable semi-annually over
five years starting September 1, 2005 with final repayment due in March 2010.
The principal benefit of refinancing the Phase 5 loan was the savings from a
lower interest margin on the refinancing facility.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Of the amount outstanding under the remaining Finnvera
guaranteed loan, US$10 million matured and was paid on March 1, 2007, US$10
million will mature on September 1, 2007, US$20 million will mature in 2008,
US$20 million will mature in 2009 and US$10 million will mature in 2010.
Principal amortization on this loan is payable in equal semi-annual
installments.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Nippon
Export and Investment Insurance of Japan, or NEXI</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
November 28, 2002, Smart signed a US$100 million term loan facility supported
by NEXI, of which US$60 million was drawn on November 28, 2003 and US$40
million on April 5, 2004.  This loan is payable semi-annually over four years
in eight equal installments starting May 28, 2004 with final repayment due in
November 2007.  The outstanding balance as at December 31, 2006 was US$25
million or Php1,226 million.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Other Export Credit Agency Supported Loans</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT has also obtained loans extended and/or
guaranteed by other export credit agencies, including the Export-Import Bank of
the United States, and the respective export credit agencies of France and Italy, in the aggregate outstanding principal amount of US$8 million as at December 31,
2006.  Smart, likewise, obtained loans guaranteed by the export credit agencies
of Norway and Italy amounting to US$3 million.  Of the amounts outstanding
under these loans, US$6 million matured and was paid on various dates between
January 2, 2007 and June 15, 2007, US$4 million will mature on various dates
between September 15, 2007 and December 15, 2007 and US$1 million will mature
in 2008.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Fixed Rate Notes</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT has the following non-amortizing fixed rate notes
outstanding as at December 31, 2006 and 2005:</p>

<p align=right style='margin-bottom:0in;
margin-bottom:.0001pt;text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">Principal</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">Interest</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Maturity</b></p>
 </td>
 <td   colspan=4 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>December 31,</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Rate</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Date</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">  2006</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">   2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=4 valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$300,000,000</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8.350%</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 6, 2017</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>US$299</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Php14,675</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$299</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php15,874</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$250,000,000</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11.375%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">May 15, 2012</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>250</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>12,261</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">250</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,265</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$167,000,000</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10.500%</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">April 15, 2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>167</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>8,182</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">175</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,272</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$110,068,000</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7.850%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">March 6, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>110</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,398</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">138</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,339</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$  19,310,000</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10.625%</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">May 15, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>19</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>947</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,120</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$112,168,000</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:13.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9.250%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:9.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">June 30, 2006</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">115</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,110</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-right:10.7pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-right:9.05pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>US$</b><b>845</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Php41,463</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">US$998</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php52,980</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Term Loans</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>US$283
Million Term Loan Facility, or Debt Exchange Facility</i></p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
July 2, 2004, Smart acquired from Piltel&#146;s creditors approximately US$289
million, or 69.4%, in the aggregate, of Piltel&#146;s outstanding restructured debt
at that time, in exchange for Smart debt and a cash payment by Smart.  In
particular, Smart paid an amount in cash of US$1.5 million, or Php84 million
and issued new debt of US$283.2 million, or Php13,892 million.</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The breakdown of the total amount of
Smart debt issued to participating Piltel creditors is as follows:</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2007 Facility in the amount of
US$0.2 million payable in full in December 2007;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2008 Facility in the amount of
US$2.9 million payable in full in December 2008; and</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
2014 Facility in the amount of
US$280.1 million payable in full in June 2014.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">As at July 2, 2004, the estimated
future cash flows for the Smart newly issued debt amounted to Php19,507
million, as determined using undiscounted cash flows.  The difference between
the sum of future cash flows for newly issued debt of Php19,507 million and
cash settlement of Php84 million, and the Php22,211 million Piltel cancelled
debt was recognized as gain on debt restructuring in the 2004 consolidated
statement of income.  The total gain from the debt restructuring amounted to
Php2,620 million (Php15.44 per share) including the gain of Php241 million from
the cash settled debt of Piltel.  The difference between the future cash flows
of the newly issued debt of Php19,507 million and the value of new debt of
Php15,854 million was deferred and presented as part of &#147;Remaining excess of
debt forgiven over value of consideration given&#148; account in the consolidated
balance sheets in conformity with the accounting for troubled debt
restructuring.  Thereafter, interest incurred on the new debt is recorded as an
offset against &#147;Remaining excess of debt forgiven over value of consideration
given&#148;.  Total interest incurred related to the new debt for the years ended
December 31, 2006, 2005 and 2004 amounted to Php368 million, Php398 million and
Php199 million, respectively.  As at December 31, 2006 and 2005, the balance of
&#147;Remaining excess of debt forgiven over value of consideration given&#148; account
for this restructuring amounted to Php2,688 million and Php3,056 million,
respectively, after giving effect to the above interest expense.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Interest for the above facilities is
payable every quarter at a floating rate of three months US$ LIBOR plus 1.00% for the 2007 and 2008 facilities, and a fixed rate of 2.25% per annum for the
2014 facility.  Furthermore, a portion of the 2014 facility amounting to US$144
million has a variable yield option whereby the creditors have an option to
elect for an early repayment at a discount either in December 2007 at 52.5% of
the relevant debt amount or in December 2008 at 57.5% of the relevant debt
amount.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>GSM </i><i>Network
Expansion Facilities</i></p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">On September 13, 2004, Smart signed a
US$104 million 5-year term loan facility to finance the related Phase 7 GSM
Equipment and services.  The facility was awarded to ABN AMRO Bank, Banque
National de Paribas, Calyon, DBS Bank and Sumitomo Mitsui Banking Corporation as
the Lead Arrangers with Finnish Export Credit, Plc as the Lender.  The full
amount of the facility was drawn on November 22, 2004, of which US$62 million
and US$83 million remained outstanding as at December 31, 2006 and 2005,
respectively.  The loan is payable over five years in ten equal semi-annual
payments starting May 2005 with final repayment in November 2009.  </p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">On June 8, 2001, Smart signed its GSM
Phase 5A financing comprised of US$195 million loans, of which US$30 million is
owed to Nordic Investment Bank, or NIB, US$15 million to Nederlandse
Financierings-Maatschappij Voor Ontwikkelingslanden N.V., or FMO, of the
Netherlands and US$150 million supported by Finnvera.  The NIB loan balance of
US$12 million was prepaid in full on December 8, 2005, and the FMO loan balance
of US$4 million was prepaid in full on March 1, 2006.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
August 8, 2005, Smart signed a US$30 million commercial facility with NIB to
partly finance the related Phase 8 GSM equipment and services contracts.  The
facility is a 5-year term loan payable semi-annually in ten equal installments
commencing six months from the first drawdown date at a floating rate of US$
LIBOR plus 0.815% margin per annum.  The facility was drawn on July 11, 2006
for the full amount of US$30 million at a floating interest of 6.445% (5.63% US$ LIBOR plus 0.815% per annum margin).  The first installment payment will commence on
January 11, 2007.  The full US$30 million amount remained outstanding as at
December 31, 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
August 10, 2005, Smart signed a loan facility for its GSM Phase 8 financing in
the amount of US$70 million.  The facility was awarded to the Bank of Tokyo
Mitsubishi Ltd., Mizuho Corporate Bank Ltd., Standard Chartered Bank and
Sumitomo Mitsui Banking Corporation as the Lead Arrangers, with FEC as the
Lender.  Smart opted to utilize only a total of US$67 million which was drawn
in February 15, 2006 and March 13, 2006 for US$10 million and US$57 million,
respectively.  The balance of US$3 million was cancelled.  The facility is a
5-year term loan payable in 10 equal semi-annual installments with final
repayment on September 1, 2010.  Interest is payable semi-annually at a fixed
rate of 4.515% per annum.  As at December 31, 2006, US$59 million remained
outstanding.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On July 31, 2006, Smart signed a U.S. Dollar Term Loan
Facility for US$44.2 million to partly finance the related Phase 9 GSM
equipment and services contracts.  The Lender is FEC with ABN AMRO Bank N.V.,
Standard Chartered Bank and Sumitomo Mitsui Banking Corporation and Mizuho Corporate
Bank Ltd. as the Lead Arrangers.  The facility is a 5-year term loan payable in
10 equal semi-annual installments commencing six months from the drawdown date
at a CIRR Fixed rate of 4.05% per annum.  The facility was drawn on November
10, 2006 for the full amount of US$44.2 million.  The first installment
commences on January 16, 2007 with final repayment on July 15, 2011.  As at
December 31, 2006, the US$44.2 million loan remained outstanding.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Other Term Loan</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
December 1, 2001, CyMed availed itself of a 6-year non-interest-bearing
advances from certain officers of the company to fund its operating expenses,
including salaries and other incidental expenses.  The outstanding balance of
this loan as at December 31, 2006 amounted to US$0.8 million, which is payable
quarterly until December 31, 2009.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Undrawn Facilities</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On October 16, 2006, Smart signed a U.S. Dollar Term
Loan Facility with Metropolitan Bank and Trust Company to finance the related
Phase 9 GSM Facility for an amount of US$50 million.  The facility is a
five-year loan payable in 18 equal and consecutive quarterly installments
commencing on the third quarter from the date of the first drawdown.  Interest
rate is floating at three-month US$ LIBOR plus 0.75% per annum margin.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>Restructured Loans</u></i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On June 4, 2001, Piltel completed the restructuring of
approximately Php41 billion of indebtedness and other claims owed to banks,
trade creditors, bondholders and preferred shareholders, representing 98% of
its total liabilities as at that date.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As a
result of the restructuring, 50% of the financial debt of each participating
creditor was released in consideration for the allotment of Piltel Series K
Class I Convertible Preferred Stock, which shares were immediately and
mandatorily converted into PLDT Convertible Preferred Stock.  One PLDT Series
V, VI or VII Convertible Preferred Stock was issued for every five Piltel
Series K Class I Convertible Preferred Stock.  Approximately, half of the
remaining 50% of all participating creditors&#146; (except for bondholders and
preferred shareholders) financial debt became their participation in a Tranche
B Loan in the same currency as their previous financial debt, and the other
half became their participation in a Tranche C Loan also in the same currency
as their previous financial debt.  In the case of bondholders and preferred
shareholders, the remaining 50% of their financial debt became their
participation in the Conversion Notes Facility and in a single Tranche Peso
loan, or the Term Notes Facility, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Additional creditors participated in the debt
restructuring plan, such that only convertible bonds with principal amount of
US$0.7 million remain unrestructured and presented as part of current portion
of interest-bearing financial liabilities.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Piltel&#146;s
residual long-term debt to third parties that was not exchanged in the debt
exchange offer conducted by Smart in 2005 consisted of:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.3%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:.05pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Description</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Restructured Debts</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Philippine
 Pesos</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">10
 year Tranche B</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php241</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">15
 year Tranche C</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">241</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">482</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">U.S.
 Dollars</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">10
 year Tranche B</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">US$10</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">515</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">15
 year Tranche C</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">515</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt' style="margin-top:0;margin-bottom:0">15
 year Conversion Notes Facility</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">99</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">5,275</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$</b><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">US$119</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">6,305</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">6,787</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Unrestructured Debt</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">U.S.
 Dollars</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Convertible
 Bonds</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$1</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>45</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">US$1</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Total</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>  45</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">6,836</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt' style="margin-top:0;margin-bottom:0">Less
 current portion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>45</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">120</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">Php6,716</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On June 5, 2006, Piltel made a partial voluntary
prepayment of principal under its Peso bank facility, U.S. dollar bank
facility, various Trade Creditor Facilities and Notes Indenture.  The voluntary
prepayment was made in lieu of depositing Excess Cash Flow from the operations
of Piltel&#146;s business into a Sinking Fund Account.  The aggregate voluntary
prepayment amount was Php9,325 million (Php6,393 million to Smart and Php2,932
million to third party creditors) or US$176 million (US$121 million to Smart
and US$55 million to third party creditors), which was applied proportionally
to the various debt facilities as set out in the Intercreditor Agreement dated
June 4, 2001 or the Intercreditor Agreement.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On December 4, 2006, Piltel prepaid the outstanding
balance of its restructured principal debt under its Peso bank facility, U.S.
Dollar bank facility, Peso Term Note facility, various Trade Creditor
Facilities and Notes Indenture in the aggregate amount of Php11,631 million
(Php8,061 million to Smart and Php3,570 million to third party creditors) or
US$233 million (US$161 million to Smart and US$72 million to third party
creditors).  Piltel obtained approval from the Bangko Sentral ng Pilipinas to
source dollar payment from authorized agent banks.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
March 30, 2007, Piltel paid the outstanding convertible bonds with principal
amount of US$0.7 million.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Piltel&#146;s restructured obligations were secured by
substantially all present and future assets of Piltel under the MTI dated June
4, 2001 between Piltel and JPMorgan Chase Bank, N.A. (Manila Branch) as
Security Agent for the creditors, which established the security arrangements
relating to the restructured debts.  The participating creditors (other than
the participating holders of the Peso Term Note facility) shared equally in
first ranking security, while non-participating creditors and the participating
holders of the Peso Term Note facility shared equally in second ranking
security created under the MTI.  Such mortgage was approved by at least
two-thirds of Piltel&#146;s stockholders at its annual meeting on April 18, 2001 and
by the NTC on May 18, 2001.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On July 7, 2006, Piltel, PLDT and JPMorgan Chase Bank,
N.A. (Manila Branch), as Security Agent on behalf of the Finance Parties under
the Intercreditor Agreement, agreed to the amendment of Clause 25 thereof to
allow the amendment of any term of the MTI and the release and sale of certain
properties or assets from the security interests created by the MTI upon the
instructions of the creditor representatives.  On the same date, and following
the effectivity of the amendment of the Intercreditor Agreement, Piltel and the
Security Agent, executed an Amendment to the MTI, pursuant to which Piltel is
allowed to sell or dispose of certain categories of assets or properties with
the consent of the Majority Bank Creditors, the Majority Trade Creditors and
the Trustee, provided, however that for as long as Avenue Asia holds a majority
of Piltel&#146;s Conversion Notes, the prior consent of Avenue Asia will be required
for (i) any sale or disposition of any of the real properties of Piltel, and
(ii) any sale or disposition of assets to Smart, PLDT or any of its affiliates.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On April 18, 2007, Piltel received a Notice of
Termination of the MTI from JP Morgan Chase Bank, N.A. (Manila Branch).</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Satellite Acquisition Loans</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Mabuhay Satellite has an existing Credit
Agreement with the Export-Import Bank of the United States, or Ex-Im Bank, to
finance a portion of the cost of purchasing the Agila II Satellite.  In 2004,
Ex-Im Bank approved, in principle, the re-profiling of Mabuhay Satellite&#146;s
US$42 million debt with them by extending the maturity of the loan by 1&#189; years
to July 15, 2007 and reducing the interest rate by 1% to 5.6%.  The revised
repayment terms have been approved by the majority of the local creditor
banks.  As at December 31, 2006, the remaining outstanding loan amounted to
US$10 million (Php511 million).</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Mabuhay
Satellite also has an existing Omnibus Agreement with a syndicate of local
banks, or the Banks, which includes issuance of irrevocable standby Letters of
Credit which as at December 31, 2006 had an aggregate stated value not
exceeding US$11 million (Php527 million) in favor of Ex-Im Bank, as security
under the Credit Agreement and a term loan to Mabuhay Satellite in the
aggregate amount of US$32 million (Php1,572 million), which will mature on
various dates from 2006 to 2009. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Mabuhay Satellite has constituted in
favor of the Banks: (a) a first mortgage on its leasehold rights under a lease
agreement entered into with the Subic Bay Metropolitan Authority and the
components of the satellite system; (b) an assignment of its rights under its
purchase contract for the satellite system; (c) an assignment of its rights
under the transponder lease contracts to be entered into with its shareholders
and other parties and the revenues therefrom; and (d) an assignment of the
applicable proceeds of insurance to be taken on the satellite system.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, the Banks have approved Mabuhay&#146;s request to extend the
maturity of the loan under the Omnibus Agreement by two years to October 20,
2009, with a 1% increase in the margin on the deferred amount.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>Japanese Yen Debt:</u></i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>JBIC JP&yen;9,760 Million Overseas </i><i>Investment</i><i>
Term Loan</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On July 26, 2002, PLDT signed a loan agreement with
JBIC for a credit facility of JP&yen;9,760 million under JBIC&#146;s OIL program.  All
outstanding amounts related to this loan were repaid in full on September 21,
2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>NEXI Supported JP&yen;5,615 Million</i> <i>Syndicated Term Loan Facility</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On June 11, 2003, PLDT signed a JP&yen;5,615 million
syndicated term loan facility supported by NEXI, of which all outstanding
amounts were repaid in full on June 13, 2006.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>Philippine Peso Debt:</u></i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Php2,</i><i>770</i><i> Million Peso Fixed Rate Corporate Notes</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In connection with PLDT&#146;s service improvement and
expansion programs, PLDT has entered into two loan agreements, pursuant to each
of which PLDT issued fixed rate corporate notes in three tranches.  Interest on
each tranche is payable semi-annually.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Under
the first loan agreement, PLDT borrowed an aggregate amount of Php1,500 million, of which Php230
million was repaid on November 11, 2002, Php500
million was repaid on November 9, 2004 and Php770
million was repaid on November 9, 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Under the second loan agreement, PLDT borrowed an
aggregate amount of Php1,270 million, of which
Php360 million was repaid on June 9, 2003, Php100 million was repaid on June 9, 2005 and Php810 million was repaid on June 12, 2007.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Php5,000 Million Peso Fixed Rate Corporate Notes</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On February 15, 2007, Smart issued Php5,000 million
unsecured fixed rate corporate notes, comprised of Series A notes amounting to
Php3,800 million and Series B notes amounting to Php1,200 million with five and
ten year terms, respectively.  Series A notes were priced at 5.625%, while
Series B notes were priced at 6.500%.  Funds raised from the issuance of these
notes will be used primarily for Smart&#146;s capital expenditures for network
improvement and expansion.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Php400 Million and Php20 Million Refinancing Loans</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
May 22, 2007, PLDT entered into loan agreements with The Philippine American
Life and General Insurance Company for Php400 million and with The Philam Bond
Fund, Inc. for Php20 million to refinance their respective participations in
the Ten-Year Note under the Php1,270 million Peso Fixed Rate Corporate Notes
which were repaid on June12, 2007.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Secured Term Loans</i></p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Php150 Million </i><i>Term Loan Facility</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On March 4, 2002, ePLDT entered into a three-year loan
facility with Philippine Bank of Communications amounting to Php150 million.
The loan facility was fully drawn on December 31, 2002 and payable in seven
quarterly installments, with a grace period of one year, beginning in 2003.
The quarterly principal payments of Php15 million started in June 2003 with a
balloon payment of Php45 million in March 2005.  Interest on this loan was
equivalent to 91-day T-bill rate plus 4% per annum payable quarterly in
arrears.  The loan was secured by ePLDT&#146;s deed of assignment of receivables of
a subsidiary from a foreign customer and an investment in an associate with an
original cost of Php629 million.  This loan was fully paid as at March 31,
2005.  The investment in this associate has been fully provided for as
disclosed in <i>Note 8 &#150; Investments</i>.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Php100
Million Term Loan Facility</i></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
March 15, 2004, ePLDT entered into a three-year term loan facility with Asia
United Bank amounting to Php100 million for the payment of its outstanding short-term
bank loan facility and for other working capital requirements.  The loan
facility was fully drawn as at December 31, 2004.  The loan was to be repaid in
nine equal quarterly installments starting March 2005 with final repayment in
March 2007.  Interest on the loan was equivalent to 90-day PHIBOR plus 3% per
annum payable quarterly in arrears.  The loan was secured by a Mortgage Trust
Indenture Agreement, or MTIA, dated March 15, 2004, with Asia United Bank &#150;
Trust and Investments Group, on a parcel of land with a carrying value of
Php279 million as at December 31, 2004.  As at December 31, 2006, the
outstanding balance of this loan amounted to Php11 million, which was repaid in
full at maturity in March 2007.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Php149 Million Term Loan Facility</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In January 2006, Vocativ, a wholly-owned call center
subsidiary of ePLDT, partially prepaid Php89 million out of its outstanding
five-year term loan facility of Php109 million with Asia United Bank for the
payment of its additional capital expenditures and working capital
requirements.  Under the terms of the loan, principal payment is to be paid in
14 equal quarterly installments starting April 2006 with final repayment in
July 2009.  Interest on the loan is equivalent to 90-day PHIBOR plus 3% per
annum payable quarterly in arrears.  The loan is secured by a Mortgage
Participation Certificate against the MTIA between ePLDT and Asia United Bank
Corporation &#150; Trust and Investments Group dated March 15, 2004 on a parcel of
land, which excludes the buildings and improvements.  The remaining balance of
Php20 million was pre-paid in April 2006.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Unsecured Term Loans</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i><u>&nbsp;</u></i></p>

<p style='margin-left:45.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Php2,500 Million </i><i>Term Loan Facility</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On August 14, 2006, Smart signed a Peso Term Loan
Facility with Metropolitan Bank and Trust Company to finance the related Phase
9 GSM facility for an amount of Php2,500 million.  The facility is a five-year
loan payable in 18 equal consecutive quarterly installments commencing on the
third quarter from the date of the first drawdown.  Interest rate is floating
at three-month MART plus 0.75% per annum margin.  The facility was drawn on
December 11, 2006 for the full amount of Php2,500 million at a floating
interest of 6.0232% (5.2732% three-month MART1 plus 0.75% per annum margin).
The first installment will commence on September 11, 2007 with final repayment
on December 9, 2011.  The full amount of Php2,500 million was outstanding as at
December 31, 2006.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='line-height:normal' style="margin-top:0;margin-bottom:0">Debt
Covenants</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Our debt instruments contain
restrictive covenants, including covenants that could prohibit us from paying
dividends on common stock under certain circumstances, and require us to comply
with specified financial ratios and other financial tests, calculated in
conformity with Philippine Financial Reporting Standards, at relevant
measurement dates, principally at the end of each quarterly period.  We have
maintained compliance with all of our maintenance financial ratios as required
under our loan covenants and other debt instruments.  However, if negative
factors adversely affect our financial ratios, we may be unable to maintain
compliance with these ratios and covenants or be unable to incur new debt.  The
terms of some of our debt instruments have no minimum amount for cross-default.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
principal factors that can negatively affect our ability to comply with the
financial ratios and other financial tests under our debt instruments are
depreciation of the Philippine peso relative to the U.S. dollar, poor operating
performance of PLDT and our consolidated subsidiaries, impairment or similar
charges in respect of investments or other long-lived assets that may be
recognized by PLDT and its consolidated subsidiaries and increases in our
interest expenses.  Interest expenses may increase as a result of various
factors including issuance of new debt, the refinancing of lower cost
indebtedness by higher cost indebtedness, depreciation of the Philippine peso,
the lowering of PLDT&#146;s credit ratings or the credit ratings of the Philippines, increase in reference interest rates, and general market conditions.  Since
approximately 96% of our total consolidated debts were denominated in foreign
currencies, principally in U.S. dollars, many of these financial ratios and
other tests are negatively affected by any weakening of the peso.  The peso has
been subject to significant fluctuations in recent years.  From 2002 to 2004,
the peso has generally been depreciating from a high of Php49.336 on May 20,
2002 to a low of Php56.443 on October 14, 2004.  In 2005, the peso fluctuated
significantly from a low of Php56.321 on July 8 to a high of Php53.062 on
December 29.  As at December 31, 2006, the peso had appreciated by 8% to Php49.045
to US$1.00, from Php53.062 to US$1.00 as at December 31, 2005.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT&#146;s ability to maintain compliance with financial
covenant requirements measured on a non-consolidated basis is principally
affected by the performance of its fixed line business, which is predominantly
conducted by PLDT.  PLDT cannot be assured of the benefit of net revenues and
cash flows generated by Smart and PLDT&#146;s other investees in assisting PLDT in
complying with non-consolidated covenants or covenants that are calculated
without giving effect to the results of PLDT&#146;s investees.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT&#146;s
debt instruments contain a number of other negative covenants that, subject to
certain exceptions and qualifications, restrict PLDT&#146;s ability to take certain
actions without lenders&#146; approval, including: (a) incurring additional
indebtedness; (b) prepaying other debt; (c) making investments; (d) extending
loans; (e) extending guarantees or assuming the obligations of other persons;
(f) paying dividends or other distributions or redeeming, repurchasing or
otherwise acquiring shares of PLDT&#146;s capital stock; (g) disposing of all or
substantially all of its assets or of assets in excess of specified thresholds
of its tangible net worth; (h) creating any lien or security interest; (i)
permitting set-off against amounts owed to PLDT; (j) merging or consolidating
with any other company; (k) entering into transactions with stockholders and
affiliates; and (l) entering into sale and leaseback transactions. </p>

<p style='text-indent:27.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Further,
certain of PLDT&#146;s debt instruments contain provisions wherein PLDT may be
required to repurchase or prepay certain indebtedness in case of change in
control of PLDT.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Moreover,
certain of PLDT&#146;s debt instruments restrict PLDT from declaring or distributing
dividends to common stockholders.  In particular, under certain loan
agreements, PLDT may not declare or pay dividends on any of its capital stock
without the prior written consent of the lenders (i) if PLDT is in default in
the payment of any amounts due and payable under such loan agreement or after
the occurrence and during the continuance of any other event of default or
potential event of default under such agreements, or (ii) in an amount greater
than PLDT&#146;s net income after taxes during the fiscal year to which such payment
or distribution relates.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">In case of a change in control of PLDT, PLDT may be
required to repurchase or prepay certain indebtedness.  Under the terms of the
11.375% Notes due 2012, we are required to offer to purchase all outstanding
notes due 2012 for cash at a price of 101% of their principal amounts plus
accrued interest in the event that (1) the aggregate of NTT Communications&#146; and
First Pacific&#146;s direct and indirect voting interest in PLDT's outstanding
capital stock having voting rights falls below 35% of such capital stock, (2)
any person or, in certain instances, group of persons, which is not controlled
directly or indirectly by First Pacific or NTT Communications acquires a direct
or indirect voting interest in PLDT&#146;s outstanding capital stock having voting
rights which equals or exceeds 35% of such capital stock and (3) if a rating
agency at such time maintains a rating on such notes, the rating agency downgrades
its credit rating on the Notes within 90 days (or more, in certain
circumstances) following notice of the occurrence of the events specified in
(1) and (2) above.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT&#146;s
debt instruments also contain customary and other default provisions that permit
the lender to accelerate amounts due or terminate their commitments to extend
additional funds under the debt instruments. These default provisions include:
(a) cross-defaults and cross-accelerations that permit a lender to declare a
default if PLDT is in default under another debt instrument; in some cases, the
cross-default provision is triggered upon a payment or other default permitting
the acceleration of PLDT&#146;s debt, whether or not the defaulted debt is
accelerated.  In other cases, the cross-default provision requires the
defaulted loan to be accelerated.  In some debt instruments, the cross-default
provision will be triggered only if the principal amount of the defaulted
indebtedness exceeds a threshold amount specified in these debt instruments; (b)
failure by PLDT to meet certain financial ratio covenants referred to above;
(c) the occurrence of any material adverse change in circumstances that a
lender reasonably believes materially impairs PLDT&#146;s ability to perform its
obligations under its debt instrument with the lender; (d) the revocation,
termination or amendment of any of the permits or franchises of PLDT in any
manner unacceptable to the lender; (e) the abandonment, termination or
amendment of the project financed by a loan in a manner unacceptable to the
lender; (f) the nationalization or sustained discontinuance of all or a
substantial portion of PLDT&#146;s business; and (g) other typical events of
default, including the commencement of bankruptcy, insolvency, liquidation or
winding up proceedings by PLDT.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Smart&#146;s debt instruments contain certain
restrictive covenants that require Smart to comply with specified financial
ratios and other financial tests at semi-annual measurement dates.  The
financial tests under Smart&#146;s loan agreements include compliance with a debt to
equity ratio of not more than 1.5:1, a debt to EBITDA ratio of not more than
3:1 and a debt service coverage ratio of not less than 1.50:1.  Smart has
maintained compliance with all of its financial covenants.  The agreements also
contain customary and other default provisions that permit the lender to
accelerate amounts due under the loans or terminate their commitments to extend
additional funds under the loans.  These default provisions include: (a)
cross-defaults and cross-accelerations that permit a lender to declare a
default if Smart is in default under another loan agreement.  These
cross-default provisions are triggered upon a payment or other default
permitting the acceleration of Smart debt, whether or not the defaulted debt is
accelerated; (b) failure by Smart to comply with certain financial ratio
covenants; (c) any reduction in PLDT&#146;s ownership of Smart&#146;s shares below 51%;
(d) any reduction in First Pacific&#146;s and Metro Pacific Corporation&#146;s collective
direct and/or indirect ownership of PLDT&#146;s common stock below 17.5% of the
total common stock outstanding; and (e) the occurrence of any material adverse
change in circumstances that the lender reasonably believes materially impairs
Smart&#146;s ability to perform its obligations under its loan agreements.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:auto' style="margin-top:0;margin-bottom:0">As at December 31, 2006 convertible
bonds with a principal amount of US$0.7 million had fallen due for payment and
had not been paid.  These bonds represented the sole unrestructured borrowings
of Piltel as at December 31, 2006 and were redeemed and paid, including accrued
interest and penalties, on March 31, 2007.  Piltel&#146;s failure to redeem the
convertible bonds when they fell due did not cause a default under the debt
arrangements of any other member of the PLDT group.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The Credit and Omnibus Agreements of
Mabuhay Satellite impose several negative covenants which, among other things,
restrict material changes in Mabuhay Satellite&#146;s nature of business and
ownership structure, any lien upon or with respect to any of its assets or to
any right to receive income, acquisition of capital stock, declaration and
payment of dividends, merger, consolidation and sale with another entity and
incurring or guaranteeing additional long-term debt beyond prescribed amounts.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">ePLDT&#146;s loan agreement imposes negative
covenants which, among other things, restrict ePLDT with regard to payment of
cash dividends or any other income or any capital distribution to PLDT,
voluntary suspension of its entire business operations for a period of 60
consecutive days, dissolution of its legal existence, and creation of any
encumbrances on the shares pledged.  One of ePLDT&#146;s loan agreements also
requires ePLDT to comply with specified financial ratios and other financial
tests at quarterly measurement dates.  The agreement also contains customary
and other default provisions that permit the lender to accelerate amounts due
under the loan or terminate their commitments to extend additional funds under
the loan.  As at December 31, 2006, ePLDT was in compliance with all of its
financial covenants.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Obligations Under Capital Lease</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
future minimum payments for capitalized leases are as follows as at December
31, 2006:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.52%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:3.95pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Year</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:3.95pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,521</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2010 and onwards</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total minimum lease payments</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,570</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Less amount representing interest</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">540</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Present value of net minimum lease payments</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,030</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Less obligations under capital lease maturing within one year (Notes
 7 and 23)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">924</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Long-term portion of obligations under capital lease (Notes 7 and 23)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:36.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 106</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Municipal Telephone Projects</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">In 1993, PLDT entered into two lease
agreements with the Philippine Department of Transportation and Communications,
or DOTC, covering telecommunications facilities in the province of Bohol and Batangas established under the Municipal Telephone Act.  Under these agreements, PLDT
was granted the exclusive right to provide telecommunications management
services, to expand services, and to promote the use of the DOTC-contracted
facilities in certain covered areas for a period of 15 years.  Title to the
properties shall be transferred to PLDT upon expiration of the lease term.  As
at December 31, 2006, PLDT&#146;s aggregate remaining obligation under this
agreement was approximately Php858 million.  In case of cancellation, PLDT is
liable to pay Php100 million under each of the two contracts as liquidated
damages.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On June 1, 2004, PLDT served the DOTC a notice of
termination of the lease agreement in respect of the telecommunications system
in Bohol which state of deterioration, obsolescence and disrepair has made it
impossible for PLDT to continue managing, operating, and maintaining the
system.  Since 2002, PLDT has been advising the DOTC of the need to review the
viability of the system as PLDT has infused more than Php200 million for
upgrades and maintenance to keep the system operable.  Further, the enactment
of Public Telecommunications Policy Act, or R.A. No. 7925, which negated the
DOTC&#146;s warranty to grant PLDT the exclusive right to provide telecommunication
services in the areas stipulated, prevented PLDT from achieving the originally
projected profitability, thereby rendering it impossible for PLDT to continue
fulfilling its obligation under the lease agreement.  Although several
discussions have been held since then, no mutually acceptable agreement has
been reached.  On June 30, 2004, the DOTC advised PLDT that the request for
termination of the lease agreement in Bohol has been referred to the Department
of Justice, or DOJ, as government agencies are required to refer all
interpretation of contracts and agreements to the DOJ secretary as
attorney-general of the national government.  On May 5, 2005, PLDT received a
letter from the DOTC stating that PLDT is in default for failure to remit to
the DOTC the quarterly installments under the lease agreement.  Due to the
failure of the parties to amicably settle their dispute, on September 28, 2005,
PLDT demanded that the dispute be referred to arbitration and that the parties
agree on the composition of the arbitration committee.  In response, the DOTC,
in a letter dated October 17, 2005, informed PLDT that pursuant to Executive
Order No. 269, Series of 2004, dated January 12, 2004, the existing
communications programs and projects implemented by DOTC were transferred to
the Commission on Information and Communications Technology, or CICT, and that
the DOTC had forwarded to CICT PLDT&#146;s letter dated September 28, 2005.  In a
letter dated March 24, 2006, the CICT informed PLDT that the CICT poses no
objection on PLDT&#146;s stated intentions and preference to refer the unresolved
and outstanding issues to the Philippine Dispute Resolution Center, Inc., or
PDRCI, per the arbitration clause of the lease agreement.  On June 27, 2006, a
Request for Arbitration dated June 1, 2006 was filed by PLDT with the PDRCI.
On November 15, 2006, DOTC has filed its answer to the said Request for
Arbitration.  As at December 31, 2006, the net book value of the
telecommunications system in Bohol, including PLDT&#146;s additional capital
expenditure relating to the telecommunications system, and corresponding
capital lease obligation amounted to Php21 million and Php735 million,
respectively.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Piltel also entered into an agreement for
the financial lease of the Palawan Telecommunications System of the Municipal
Telephone Public Office with the DOTC on September 3, 1994.  The Municipal
Telephone Public Office Contract is a 30-year contract for Piltel to lease
facilities for public call office stations in the Palawan area, with revenues
going to Piltel.  In consideration, Piltel pays the DOTC an escalating annual
lease fee.  As at December 31, 2006, Piltel&#146;s aggregate remaining obligation
under this agreement was approximately Php477 million.</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>Other Long-term Capital
Lease Obligations</i> </p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The PLDT Group has various long-term lease contracts
for a period of three years covering various office equipment.  In particular,
PLDT, Smart and ePLDT have capital lease obligations in the aggregate amount of
Php237 million as at December 31, 2006 in respect of office equipment.</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Under
the terms of certain loan agreements and other debt instruments, PLDT may not
create, incur, assume or permit or suffer to exist any mortgage, pledge, lien
or other encumbrance or security interest over the whole or any part of its
assets or revenues or suffer to exist any obligation as lessee for the rental
or hire of real or personal property in connection with any sale and leaseback
transaction.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Notes Payable</b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">In 2006, SPi obtained unsecured dollar-denominated
short-term notes payable from various local commercial banks amounting to
US$3.7 million.  Interest on the notes range from 7.4% to 9.2% of the
outstanding balance per annum and the notes are payable within an average of
150 days from the availment date.  The outstanding balance of Php201 million as
at December 31, 2006 will mature in various months in 2007.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>13.    Deferred Credits and Other Noncurrent
Liabilities</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">This account consists of:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.68%;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:7.75pt;
 margin-bottom:0in;margin-left:.05pt;margin-bottom:.0001pt;text-align:right;
 text-indent:-.05pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:7.7pt;
 margin-bottom:0in;margin-left:4.65pt;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accrual of capital expenditures under
 long-term financing</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,646</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,769</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Liabilities on asset retirement
 obligations (Note 3)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>831</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">752</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Advance payment under a receivables
 purchase facility (Note 5)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>205</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">976</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,850</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">924</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in;text-indent:-.25in;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>8,532</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 2.25pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.75pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8,421</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>14.    Preferred Stock Subject to Mandatory
Redemption</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As at December 31, 2006, PLDT had issued 3 million
shares of Series V Convertible Preferred Stock, <br>
5 million shares of Series VI Convertible Preferred Stock and 4 million shares
of Series VII Convertible Preferred Stock in exchange for Series K Class I
Convertible Preferred Stock of Piltel, pursuant to the debt restructuring plan
of Piltel adopted in June 2001.  As discussed below, as at December 31, 2006,
all Series VII Convertible Preferred Stock had been converted.  Shares of
Series V and VI Convertible Preferred Stock are entitled to receive annual
dividends of Php18.70 per share and US$0.397 per share, respectively.  Each
share of Series V and VI Convertible Preferred Stock is convertible at any time
at the option of the holder into one PLDT common share.  On the date
immediately following the seventh anniversary of the issue date of the Series V
and Series VI Convertible Preferred Stock, the remaining outstanding shares
under these series will be mandatorily converted into PLDT common shares.
Under a put option exercisable for 30 days, holders of common shares received
on mandatory conversion of the Series V and VI Convertible Preferred Stock will
be able to require PLDT to purchase such PLDT common shares for Php1,700 per
share and US$36.132 per share, respectively.  Due to the foreign currency
component of the call option embedded in the Series VI Convertible Preferred
Stock, such call options were bifurcated and accounted for separately in
conformity with SFAS No. 133, as amended, see <i>Note 23</i> &#150; <i>Financial
Assets and Liabilities</i>.  The aggregate fair value of the issued Series V,
VI and VII Convertible Preferred Stock as at date of issuance &#150; net of the
bifurcated option values &#150; is shown under the &#147;Preferred Stock Subject to
Mandatory Redemption&#148; account in the consolidated balance sheets.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">As at June 4, 2001, the aggregate
fair value of the issued Series V, VI and VII Convertible Preferred Stock
(inclusive of the option values) amounted to Php10,165 million, as determined
using an independent party&#146;s valuation model.  The remaining difference between
this aggregate fair value amount and the Php20,080 million Piltel restructured
debt was deferred and presented as part of &#147;Remaining excess of debt forgiven
over value of consideration given&#148; account in the consolidated balance sheets
in conformity with the accounting for troubled debt restructuring, such that no
gain was recorded on the restructuring.  Thereafter, interest incurred on the
remaining restructured debt is recorded as an offset against remaining excess
of debt forgiven over the value of consideration given.  Total interest
incurred related to the restructured debt for the years ended December 31,
2006, 2005 and 2004 amounted to Php317 million, Php365 million and Php473
million, respectively.  As at December 31, 2005, the remaining excess of debt
forgiven over the value of consideration given balance amounted to Php2,015
million and none as at December 31, 2006, after giving effect to the above
interest expense, cancellation of Piltel debt through Smart acquisition from
Piltel&#146;s creditors of the 69.4% of outstanding restructured Piltel debt and
voluntary prepayment of Piltel&#146;s debt, see <i>Note 12 &#150; Interest-bearing
Financial Liabilities,</i> and the additional issuances in 2004 and 2003 of
convertible preferred shares to restructure Piltel&#146;s debt.  The remaining
excess of debt forgiven over the value of consideration given amounted to
Php1,698 million and was recognized as gain in the consolidated statement of
income for the year ended December 31, 2006 due to prepayment of Piltel&#146;s debt.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The difference between the aggregate fair value of the
Series V, VI and VII Convertible Preferred Stock at issue date (net of the
bifurcated option values for Series VI and VII) and the aggregate redemption
value is accreted over the period up to the call option date using the
effective interest rate method.  Accretions added to &#147;Preferred stock subject
to mandatory redemption&#148; and charged against accumulated deficit as at December
31, 2006, 2005 and 2004 amounted to Php765 million, Php1,443 million and
Php1,503 million, respectively.  Unaccreted balance as at December 31, 2006 and
2005 amounted to Php256 million and Php3,886 million, respectively.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&#147;Preferred
Stock Subject to Mandatory Redemption&#148; amounted to Php1,374 million and
Php12,004 million as at December 31, 2006 and 2005, respectively, after
revaluation of Series VI and VII Convertible Preferred Stock to the exchange
rates at balance sheet dates and after giving effect to the above accretions,
conversions and additional issuances.  As at December 31, 2006 and 2005, 10,937,309
shares and 3,376,743 shares, respectively, of the Convertible Preferred Stock
have been converted into PLDT common shares.  On August 18, 2006, all 3,842,000
shares of Series VII Convertible Preferred Stock were converted into PLDT
common shares.  The outstanding shares of Series V and VI Convertible Preferred
Stock as at December 31, 2006 were 46,047 and 875,188, respectively.  The
aggregate redemption value of the outstanding Series V and VI Convertible
Preferred Stock amounted to Php1,629 million and Php15,890 million as at
December 31, 2006 and 2005, respectively.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>15.    Stockholders&#146; Equity</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The movement of PLDT&#146;s capital accounts for the years
ended December 31, 2004, 2005 and 2006 are as follows:</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;margin-left:5.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=4 valign=bottom style=' border-top:double windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Preferred Stock</b> &#150; <br>
 Php10 par value per share</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 border-top:double windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Series <br>
 A to GG</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>III</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>IV</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Common Stock</b> &#150;Php5 par value <br>
 per share</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='margin-left:3.55pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>No. of Shares</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Total Preferred Stock</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>No. of Shares</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=8 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">(in million shares and pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Authorized</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">823</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php8,230</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">234</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php1,170</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Outstanding</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at January 1, 2004</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">410</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 451</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,505</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">169</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php847</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Issuance</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">   1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Conversion</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(17)</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at December 31, 2004</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 409</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">   5</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 450</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,497</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 170</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php851</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at January 1, 2005</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 409</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">   5</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 450</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,497</p>
 </td>
 <td   colspan=2 valign=top style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">170</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php851</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Issuance</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Conversion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(67)</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">51</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at December 31, 2005</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 407</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 443</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,433</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 181</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php904</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:4.5pt;text-indent:-4.5pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at January 1, 2006</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 407</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">36</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 443</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php4,433</p>
 </td>
 <td   colspan=2 valign=top style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 181</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php904</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Issuance</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:8.1pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Conversion</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(11)</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Balance at December 31, 2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 406</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>36</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 442</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Php4,424</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 188</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Php942</b></p>
 </td>
 </tr>
 <tr height=0>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 <td  style='border:none'></td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Preferred Stock</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
preferred stock is non-voting, except as specifically provided by law, and is
preferred as to liquidation.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The Series A to GG 10% Cumulative
Convertible Preferred Stocks earn cumulative dividends at an annual rate of
10%.  After the lapse of one year from the last day of the year of issuance of
a particular series of 10% Cumulative Convertible Preferred Stock, any holder
of such series may convert all or any of the shares of 10% Cumulative
Convertible Preferred Stock held by him into fully paid and non-assessable
shares of Common Stock of PLDT, at a conversion price equivalent to 10% below
the average of the high and low daily sales price of a share of Common Stock on
the PSE, or if there have been no such sales on the PSE on any day, the average
of the bid and the asked prices of a share of Common Stock of PLDT at the end
of such day on such Exchange, in each such case averaged over a period of 30
consecutive trading days prior to the conversion date, but in no case shall the
conversion price be less than the price set by the Board of Directors which, as
at December 31, 2006, was Php5.00 per share.  The number of shares of Common
Stock issuable at any time upon conversion of one share of the subscriber
investment plan, or SIP, or the 10% Cumulative Convertible Preferred Stock is
determined by dividing Php10.00 by the then applicable conversion price.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">In case the shares of Common Stock at anytime
outstanding are subdivided into a greater or consolidated into a lesser number
of shares, then the minimum conversion price per share of Common Stock will be
proportionately decreased or increased, as the case may be, and in the case of
a stock dividend, such price will be proportionately decreased, provided,
however, that in every case the minimum conversion price shall not be less than
the par value per share of Common Stock.  In the event the relevant effective
date for any such subdivision or consolidation of shares or stock dividend
occurs during the period of 30 trading days preceding the presentation of any
shares of 10% Cumulative Convertible Preferred Stock for conversion, a similar
adjustment will be made in the sales prices applicable to the trading days
prior to such effective date utilized in calculating the conversion price of
the shares presented for conversion.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
case of any other reclassification or change of outstanding shares of Common
Stock, or in case of any consolidation or merger of PLDT with or into another
corporation, the Board of Directors shall make such provisions, if any, for
adjustment of the minimum conversion price and the sales price utilized in
calculating the conversion price as the Board of Directors, in its sole
discretion, shall deem appropriate.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">At
PLDT&#146;s option, the Series A to GG 10% Cumulative Convertible Preferred Stocks
are redeemable at par value plus accrued dividends five years after the year of
issuance.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
December 6, 2005, the Board of Directors designated 100,000 shares of serial
preferred stock as Series GG 10% Cumulative Convertible Preferred Stock for
issuance throughout 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
January 30, 2007, the Board of Directors designated 150,000 shares of serial
preferred stock as Series HH 10% Cumulative Preferred Stock for issuance up to
December 31, 2009.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
issuance of SIP Series FF, GG and HH is an exempt transaction under Section
10.2 of the Securities Regulation Code, as confirmed by the Philippine SEC on
April 2, 2007.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On October 24, 2005, PLDT issued to JPMorgan, as
depositary, and to the holders of the Series III Convertible Preferred Stock a
notice of mandatory conversion of all of its outstanding 4,616,200 shares of
Series III Convertible Preferred Stock into shares of PLDT Common Stock.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
November 2005, PLDT issued 710,891 shares of common stock on account of the
voluntary conversion of 415,023 shares of Series III Convertible Preferred
Stock.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">As at December 19,
2005, as a result of PLDT&#146;s issuance of a notice of mandatory conversion, all
of the outstanding shares of Series III Convertible Preferred Stock were
voluntarily and mandatorily converted into shares of PLDT Common Stock.  Each share
of Series III Convertible Preferred Stock was converted into 1.7129 shares of
Common Stock.  A total of 7,907,032 shares of PLDT&#146;s Common Stock were issued
as a result of the voluntary and mandatory conversions of all of the Series III
Convertible Preferred Stock.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The Series IV Cumulative Non-Convertible Redeemable
Preferred Stock earns cumulative dividends at an annual rate of 13.5% based on
the paid-up subscription price.  It is redeemable at the option of PLDT at any
time one year after subscription and at the actual amount paid for such stock,
plus accrued dividends.  On February 26, 2002, the Board of Directors called
for the payment of a portion of the balance of the subscription price of the
Series IV Cumulative Non-Convertible Redeemable Preferred Stock amounting to
Php72 million, which was paid on March 5, 2002.  On March 22, 2002, PLDT
redeemed 60 million shares out of the 360 million subscribed shares of its Series
IV Cumulative Non-Convertible Preferred Stock and paid Php72 million,
representing the redemption price plus unpaid dividends up to the date of
redemption.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
provisions of certain subscription agreements involving preferred stock have an
effect on the ability of PLDT to, without written consent, sell certain assets
and pay cash dividends unless all dividends for all past quarterly dividend
periods have been paid, and provision has been made for the currently payable
dividends.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>16.    Related Party Transactions</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following is a summary of related party accounts with affiliates presented as
part of our consolidated balance sheets as at December 31, 2006 and 2005 and
consolidated statements of income for the years ended December 31, 2006, 2005
and 2004:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>

 <tr style='height:10.2pt'>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.2pt'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.2pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.2pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.2pt'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.5pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Consolidated Balance Sheets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Accrued expenses and other current
 liabilities</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,120</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,711</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:37.8pt;text-align:right' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">Consolidated Statements
 of Income</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-left:9.0pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Repairs and maintenance</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>18</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">640</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">111</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Selling and promotions</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>23</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">29</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">32</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Professional and other contracted services</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>725</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">147</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">694</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Rent</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Taxes and licenses</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>53</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Insurance and security services</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:.05in;
 margin-bottom:0in;margin-left:9.0pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>360</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">467</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">534</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-align:justify' style="margin-top:0;margin-bottom:0">Cost of satellite air time</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>698</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,008</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">1,299</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:40.5pt;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>a.   Air Time Purchase Agreement
between PLDT and AIL and Related Agreements</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
is a party to a Founder NSP Air Time Purchase Agreement, or ATPA, entered into
with AIL in March 1997, which was amended in December 1998 (as amended, the
&#147;Original ATPA&#148;), under which PLDT was granted the exclusive right to sell AIL
services as national service provider, or NSP, in the Philippines.  In
exchange, the Original ATPA required PLDT to purchase from AIL a minimum of
US$5 million worth of air time (the &#147;Minimum Air Time Purchase Obligation&#148;)
annually over ten years commencing on January 1, 2002 (the &#147;Minimum Purchase
Period&#148;), the purported date of commercial operations of the Garuda I
Satellite. In the event that AIL&#146;s aggregate billed revenue was less than US$45
million in any given year, the Original ATPA also required PLDT to make
supplemental air time purchase payments not to exceed US$15 million per year
during the Minimum Purchase Period (the &#147;Supplemental Air Time Purchase
Obligation&#148;).</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Under
the Original ATPA, the Minimum Air Time Purchase Obligation and the Supplemental
Air Time Purchase Obligation terminated upon the earlier of (i) the expiration
of the Minimum Purchase Period and (ii) the date on which all indebtedness
incurred by AIL to finance the AIL System has been repaid.  AIL indebtedness
consists of: (1) loans with several financial institutions (the &#147;Banks&#148;) under
the Credit Agreement dated March 12, 1997, as amended from time to time,
including the amendment through the rescheduling agreement, dated September 30,
2002, which extended the principal repayment dates to agreed periods with the
final maturity date on January 31, 2012 (collectively, the &#147;Amended Credit
Agreement&#148;); and (2) amounts owing to MMOC under the Spacecraft Contract dated
August 28, 1995, as amended on December 30, 1998.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006 and 2005, PLDT&#146;s outstanding accrued obligations under the
Original ATPA was Php3,991 million and Php3,493 million, respectively.  Total airtime
purchases made under this agreement amounted to Php698 million, Php1,008
million and Php1,299 million for the years ended December 31, 2006, 2005 and
2004, respectively. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">AIL
has incurred recurring significant operating losses, negative operating cash
flows, and significant levels of debt.  The financial condition of AIL was
partly due to the NSPs, inability to generate the amount of revenues originally
expected as the growth in subscriber numbers has been significantly lower than
budgeted.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
September 1, 2006, AIL, PT Asia Cellular Satellite, a 95% owned subsidiary of
AIL, and Inmarsat Global Limited, or Inmarsat, reached an agreement to pool
their resources to develop powerful and novel product and service offerings in
the Asian region, founded on their respective mobile satellite communications
networks, with (a) Inmarsat performing the role of satellite and network
operator and wholesale product and services developer and (b) AIL performing
the role of wholesale and retail distributor of products and services.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Inmarsat operates a constellation of geostationary
satellites that extend mobile phone, fax and data communications to nearly
every part of the world through the services it offers to end users through its
established chain of distribution partners and satellite communications service
providers.</p>

<p style='margin-left:9.35pt;text-indent:-9.35pt;line-height:
8.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
September 1, 2006, PLDT entered into a gateway services agreement with
Inmarsat, under which PLDT committed to provide gateway infrastructure in Subic Bay up to a maximum amount of US$5 million.  In exchange, PLDT will earn US$0.015 per
minute for interconnection services to be provided to Inmarsat distribution
partners for traffic going through the gateway facility in Subic Bay.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
September 1, 2006, AIL and PT Asia Cellular Satellite entered into a term
sheet, as amended on October 20, 2006 and further amended on November 20, 2006
(the &#147;Bank Term Sheet&#148;), with a majority of the banks to be used as the basis
for further good faith negotiations between the parties thereto with a view to
entering into an agreement further amending the Amended Credit Agreement with
AIL&#146;s bank creditors.  Under the Banks Term Sheet, a majority of the banks
agreed, subject to satisfaction of certain conditions, among other things, to
amend the Original ATPA as set forth in an attachment to the Banks Terms Sheet
and to restructure AIL&#146;s indebtedness.  Pursuant to the business collaboration
arrangements between AIL and Inmarsat, on September 1, 2006, Inmarsat made the
first payment of US$4 million to AIL which was used to pay principal and
interest payable to the banks in accordance with the Banks Term Sheet.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On February 1, 2007, the parties to the Original ATPA
entered into an amendment to the Original ATPA on substantially the terms
attached to the Bank Terms Sheet (the &#147;Amended ATPA&#148;).  Under the Amended ATPA,
the Minimum Air Time Purchase Obligation was amended and replaced in its
entirety with an obligation of PLDT (the &#147;Amended Minimum Air Time Purchase
Obligation&#148;) to purchase from AIL a minimum of US$500,000 worth of air time
annually over a period ending upon the earlier of (i) the expiration of the
Minimum Purchase Period and (ii) the date on which all indebtedness incurred by
AIL to finance the AIL System is repaid.  Furthermore, the Amended ATPA
unconditionally released PLDT from any obligations arising out of or in
connection with the Original ATPA prior to the date of the Amended ATPA, except
for obligations to pay for billable units used prior to such date.  Moreover,
pursuant to a letter of confirmation, dated February 1, 2007, the banks
released and discharged PLDT and ACeS Philippines and their respective
subsidiaries from any and all obligations and liabilities under the Original
ATPA and related agreements. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Moreover,
in accordance with the above contractual arrangements, ACeS Philippines
acquired (i) from LMGT Holdings (ACeS), Inc., or LMGT, 50% of its equity
interest in AIL for a consideration of US$0.75 million pursuant to a sale and
purchase agreement entered into on February 1, 2007 and (ii) from Tera Global
Investment Ltd., or TGIL, for a nominal consideration 50% of TGIL&#146;s interest in
a promissory note issued by AIL, which 50% interest represents an aggregate
amount of US$44,743,752, or the Transferred AIL Note, together with related
security interests pursuant to sale agreement entered into on February 1,
2007.  Immediately thereafter, a portion of the Transferred AIL Note was
converted into shares of AIL and the balance was converted into non-interest
bearing convertible bonds of AIL.  As a result of these transactions, ACeS
Philippines owned 36.99% of AIL as at the date of this report.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>b.   Transactions with </i><i>Major</i><i>
Stockholders, Directors and Officers </i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Material
transactions to which PLDT or any of its subsidiaries is a party, in which a
director, key officer or owner of more than 10% of the outstanding common stock
of PLDT, or any member of the immediate family of a director, key officer or
owner of more than 10% of the outstanding common stock of PLDT had a direct or
indirect material interest, as at December 31, 2006 and 2005 and for each of the
three years ended December 31, 2006, 2005 and 2004 are as follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>1.   Cooperation Agreement with First Pacific and
certain affiliates, or the FP Parties, NTT Communications and DoCoMo</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
connection with the transfer by NTT Communications Corporation, or NTT
Communications, of approximately 12.6 million shares of PLDT&#146;s common stock to NTT
DoCoMo, Inc., or DoCoMo, pursuant to a Stock Sale and Purchase Agreement dated
January 31, 2006 between NTT Communications and DoCoMo, the FP Parties, NTT
Communications and DoCoMo entered into a Cooperation Agreement, dated January
31, 2006.  Under the Cooperation Agreement, the relevant parties extended
certain rights of NTT Communications under the Stock Purchase and Strategic
Investment Agreement dated September 28, 1999, as amended, and the Shareholders
Agreement dated March 24, 2000, to DoCoMo, including:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
certain contractual veto rights
over a number of major decisions or transactions; and</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
rights relating to the
representation on the board of directors of PLDT and Smart, respectively, and
any committees thereof.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Moreover, key provisions of the Cooperation Agreement
pertain to, among other things:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Restriction on Ownership of
Shares of PLDT by NTT Communications and DoCoMo. </i> Each of NTT Communications and DoCoMo has agreed not
to beneficially own, directly or indirectly, in the aggregate with their
respective subsidiaries and affiliates, more than 21% of then issued and
outstanding shares of PLDT&#146;s common stock.  If such event does occur, the FP
Parties, as long as they own in the aggregate not less than 21% of then issued
and outstanding shares of PLDT&#146;s common stock, have the right to terminate
their respective rights and obligations under the Cooperation Agreement, the
Shareholders Agreement and the Stock
Purchase and Strategic Investment Agreement.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Limitation on Competition.</i>  NTT Communications, DoCoMo and their respective
subsidiaries are prohibited from investing in excess of certain thresholds in
businesses competing with PLDT in respect of customers principally located in
the Philippines and from using their assets in the Philippines in such
businesses. Moreover, if PLDT, Smart or any of Smart&#146;s subsidiaries
intends to enter into any contractual arrangement relating to certain competing
businesses, PLDT is required to provide, or to use reasonable efforts to procure
that Smart or any of Smart&#146;s subsidiaries provide, NTT Communications and
DoCoMo with the same opportunity to enter into such agreement with PLDT or
Smart or Smart&#146;s subsidiaries, as the case may be.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Business Cooperation.</i>  PLDT and DoCoMo agreed in principle to collaborate
with each other on the business development, roll-out and use of a
wireless-code division multiple access mobile communication network.  In
addition, PLDT agreed, to the extent of the power conferred by its direct or
indirect shareholding in Smart, to procure that Smart will (i) become a
member of a strategic alliance group for international roaming and corporate
sales and services and (ii) enter into a business relationship concerning
preferred roaming and inter-operator tariff discounts with DoCoMo.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Additional Rights of DoCoMo. </i> Upon NTT Communications, DoCoMo and their
subsidiaries owning in the aggregate 20% or more of the shares of PLDT&#146;s
common stock and for as long as NTT Communications, DoCoMo and their
subsidiaries continue to own in the aggregate 17.5% of the shares of PLDT&#146;s
common stock then outstanding, DoCoMo will be entitled to certain additional
rights under the Cooperation Agreement.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Change in Control.</i>  Each of NTT
Communications, DoCoMo and the FP Parties agreed that to the extent permissible
under applicable laws and regulations of the Philippines and other
jurisdictions, subject to certain conditions, to cast its vote as a shareholder
in support of any resolution proposed by the board of directors of PLDT for the
purpose of safeguarding PLDT from any Hostile Transferee.  A <i>&#147;Hostile
Transferee&#148;</i> is defined under the Cooperation Agreement to mean any person
(other than NTT Communications, DoCoMo, First Pacific or any of their
respective affiliates) determined to be so by the PLDT board of directors and
includes, without limitation, a person who announces an intention to acquire,
seeking to acquire or acquires 30% or more of PLDT common shares then issued
and outstanding from time-to-time or having (by itself or together with itself)
acquired 30% or more of the PLDT common shares announces an intention to
acquire, seeking to acquire or acquires a further 2% of such PLDT common shares
(a) at a price per share which is less than the fair market value as determined
by the board of directors of PLDT as advised by a professional financial
advisor, (b) which is subject to conditions which are subjective or which could
not reasonably be satisfied, (c) without making an offer for all PLDT common
shares not held by it and/or its affiliates and/or persons who, pursuant to an
agreement or understanding (whether formal or informal), actively cooperate to
obtain or consolidate control over PLDT, (d) whose offer for the PLDT common
shares is unlikely to succeed or (e) whose intention is otherwise not <i>bona
fide</i>; provided that, no person will be deemed a Hostile Transferee unless
prior to making such determination, the board of directors of PLDT has used
reasonable efforts to discuss with NTT Communications and DoCoMo in good faith
whether such person should be considered a Hostile Transferee.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Termination.</i>  If NTT Communications, DoCoMo or their respective
subsidiaries cease to own, in the aggregate, full legal and beneficial title to
at least 10% of the shares of PLDT&#146;s common stock then issued and outstanding,
their respective rights and obligations under the Cooperation Agreement and the
Shareholders Agreement will terminate and the Strategic Arrangements (as defined in the
Stock Purchase and Strategic Investment Agreement) will terminate.  If the FP
Parties and their respective subsidiaries cease to have, directly or
indirectly, effective voting power in respect of shares of PLDT&#146;s common stock
representing at least 18.5% of the shares of PLDT&#146;s common stock then issued
and outstanding, their respective rights and obligations under the Cooperation
Agreement, the Stock Purchase and Strategic Investment Agreement, and the
Shareholders Agreement will terminate.</p>

<p style='margin-left:.5in;punctuation-wrap:hanging;text-autospace:
ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>2.   Integrated i-</i><i>mode</i><i>
Services Package Agreement between DoCoMo and Smart</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">An Integrated i-mode Services Package Agreement was
entered into by Smart and DoCoMo on February 15, 2006, under which DoCoMo
agreed to grant Smart, on an exclusive basis within the territory of the
Philippines for a period of five years, an integrated i-mode services package
including a non-transferable license to use the licensed materials and the
i-mode brand, as well as implementation support and assistance and
post-commercial launch support from DoCoMo. Pursuant to this agreement, Smart
is required to pay an initial license fee and running royalty fees based on the
revenue arising from i-mode subscription fees and data traffic.  The initial
license fee paid as at December 31, 2006 amounted to Php53 million.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0"><i>3.   Advisory
Services Agreement between DoCoMo and PLDT</i></p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">An
Advisory Services Agreement was entered into by DoCoMo and PLDT on June 5,
2006, in accordance with the Cooperation Agreement.  Pursuant to the Agreement,
DoCoMo will provide the services of certain key personnel in connection with
certain aspects of the business of PLDT and Smart.  Also, the agreement governs
the terms and conditions of the appointments and the corresponding fees related
thereto.  The initial license fee paid as at December 31, 2006 amounted to
Php12 million.  Outstanding liability under this agreement amounted to Php32
million as at December 31, 2006.</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>4.   </i><i>Other</i><i> Agreements
with NTT Communications and/or its Affiliates</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:0in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">PLDT is a party to the following
agreements with NTT Communications and/or its affiliates:</p>

<p style='margin-left:.5in;text-indent:0in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Advisory Services Agreement</i>.   On March 24, 2000, PLDT entered into an agreement
with NTT Communications, as amended on March 31, 2003, March 31, 2005 and June
16, 2006, under which NTT Communications provides PLDT with technical,
marketing and other consulting services for various business areas of PLDT
starting April 1, 2000;</p>

<p style='margin-left:.5in;text-indent:0in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Arcstar Licensing Agreement and
Arcstar Service Provider Agreement.   </i>On
March 24, 2000, PLDT entered into an agreement with NTT Worldwide
Telecommunications Corporation under which PLDT markets managed data and other
services under NTT Communications&#146; &#147;Arcstar&#148; brand to its corporate customers
in the Philippines.  PLDT also entered into a Trade Name and Trademark
Agreement with NTT Communications under which PLDT has been given the right to
use the tradename &#147;Arcstar&#148; and its related trademark, logo and symbols, solely
for the purpose of PLDT&#146;s marketing, promotional and sales activities for the
Arcstar services within the Philippines; and</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<i>Conventional International
Telecommunications Services Agreement</i>.
 On March 24, 2000, PLDT entered into an agreement with NTT Communications
under which PLDT and NTT Communications agreed to cooperative arrangements for
conventional international telecommunications services to enhance their
respective international businesses.</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total fees under these agreements amounted to Php184
million, Php256 million and Php336 million for the years ended December 31,
2006, 2005 and 2004, respectively.  As at December 31, 2006 and 2005,
outstanding obligations of PLDT amounted to Php18 million and Php23 million,
respectively.</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>5.   Agreement between Smart and Asia Link B.V., or ALBV </i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Smart
has an existing Technical Assistance Agreement with ALBV, a subsidiary of the
First Pacific Group, for ALBV to provide technical support services and assistance
in the operations and maintenance of cellular business for a period of five
years, subject to renewal upon mutual agreement between the parties.  The
agreement provides for quarterly payments of technical service fees equivalent
to 2% of the net revenues of Smart.  In January 2004, the agreement was
amended, reducing the technical service fees to be paid by Smart to ALBV to 1%
of net revenues effective January 1, 2004.  On February 18, 2004, Smart and
ALBV entered into a renewal of the Technical Assistance Agreement extending the
effectivity of the terms thereof to February 23, 2008.  Furthermore, in view of
the acquisition by Smart of Piltel Series K Class I Convertible Preferred Stock
held by PLDT, the parties agreed to make the consolidated net revenues of Smart
the basis for the computation of the 1% technical service fees payable by Smart
to ALBV, effective January 1, 2005.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart also has an existing Services Agreement with
ALBV for a period of 25 years starting January 1, 1999, which shall automatically
expire unless renewed by mutual agreement of both parties.  Under the
agreement, ALBV provides advice and assistance to Smart in sourcing capital
equipment and negotiating with international suppliers, arranging international
financing and other services therein consistent with and for the furtherance of
the objectives of the services.  Service agreement fees were paid for the whole
25-year period.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Total fees under these agreements amounted to Php591 million, Php567
million and Php507 million for the years ended December 31, 2006, 2005 and
2004, respectively.  Outstanding obligations of Smart under these agreements
amounted to Php128 million and Php194 million as at December 31, 2006 and 2005,
respectively.  Outstanding prepaid management fees as at December 31, 2006 and
2005 amounted to Php869 million and Php920 million, respectively.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>6.   Agreements relating to insurance
companies</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Gotuaco del Rosario and Associates, or Gotuaco, acts
as the broker for certain insurance companies to cover certain insurable
properties of the PLDT Group.  Insurance premiums are remitted to Gotuaco and
the broker&#146;s fees are settled between Gotuaco and the insurance companies.  In
addition, PLDT has an insurance policy with Malayan Insurance Co., Inc., or
Malayan, wherein premiums are paid directly to Malayan.  Total insurance
expenses paid under these agreements amounted to Php360 million, Php468 million
and Php534 million for the years ended December 31, 2006, 2005 and 2004,
respectively.  Two directors of PLDT have a direct/indirect interests in or
serve as a director/officer of Gotuaco and Malayan.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>17.    Employee Benefits</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Share-Based Payment</i></b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.2in;text-indent:21.05pt' style="margin-top:0;margin-bottom:0"><i>Executive Stock Option Plan, or ESOP</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Stock
options granted under the ESOP vest over five years and have a maximum contractual
life of ten years from the date of grant.  The exercise price of the options
granted under the ESOP shall not be lower than the average of the closing price
of our common stock on the PSE for 30 calendar days immediately preceding the
date of grant.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
stock options granted under the ESOP shall vest, beginning two years from the
grant date at a per year rate of 25% of the options granted.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The number of shares reserved under the ESOP should
not exceed 1.2% of the total issued common shares of PLDT, and the number of
shares reserved for issuance under the ESOP is increased to include any shares
of PLDT&#146;s common stock issuable upon exercise of options granted under the ESOP
that expire or lapse for any reason without having been exercised in full. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
ESOP will terminate on December 10, 2009, unless PLDT&#146;s Board of Directors
terminates it earlier. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">On
December 10, 1999, PLDT granted 1,289,745 options to purchase shares of PLDT&#146;s
common stock under the ESOP.  Stock option activity under the ESOP for the
years ended December 31, 2006, 2005 and 2004 is summarized below:</p>

<p align=right style='text-align:right;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0  style='width:6.5in;border-collapse:collapse'>
 <tr style='height:9.3pt'>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.3pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.3pt'>
 <p align=center style='margin-right:4.3pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Weighted Average
 Exercise Price Per Share</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.3pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.3pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:9.3pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at beginning of year</p>
 </td>
 <td  valign=top style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php814</p>
 </td>
 <td  valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>197,500</b></p>
 </td>
 <td  valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">536,589</p>
 </td>
 <td  valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">900,118</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Exercised shares</p>
 </td>
 <td  valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">814</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin:0in;margin-bottom:.0001pt;
 text-align:right;line-height:normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(78,466)</b></p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(335,605)</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(336,745)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cancellations/forfeitures</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">814</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(3,484)</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(26,784)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at end of year</p>
 </td>
 <td  valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.5in;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Php814</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>119,034</b></p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">197,500</p>
 </td>
 <td  valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">536,589</p>
 </td>
 </tr>
</table></center></div>

<p align=right style='text-align:right;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">All
the above grants under the ESOP were made to executives of PLDT and all
outstanding stock options became fully vested in December 2004.</p>

<p align=right style='text-align:right;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
number of options exercisable at December 31, 2006 and 2005 were 119,034 shares
and 197,500 shares, respectively.</p>

<p align=right style='text-align:right;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">In conformity with the provisions
of SFAS No. 123, the fair value of each option is estimated using the
Black-Scholes valuation model with the following assumptions for grants under
the ESOP during the year ended December 31, 1999: volatility of 71.3%,
risk-free interest rate of 8.94% at the date of grant and an expected term of
five years.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
weighted average per share fair value of common stock options granted in 2002
was Php582.59.  The remaining weighted average contractual life was three years
as at December 31, 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Long-Term
Incentive Plan, or LTIP</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On August 3, 2004, PLDT&#146;s Board of Directors approved the establishment
of a Long-term Incentive Plan, or Original LTIP, for eligible key executive
officers and advisors of PLDT and its subsidiaries, which is administered by
the Executive Compensation Committee.  The Original LTIP was a four-year
cash-settled share based plan covering the period from January 1, 2004 to
December 31, 2007, or the Performance Cycle.  The payment was intended to be
made at the end of the Performance Cycle (without interim payments) and
contingent upon the achievement of an approved target increase in PLDT&#146;s common
share price by the end of the Performance Cycle and a cumulative consolidated
net income target for the Performance Cycle.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On August 28, 2006, PLDT&#146;s Board of Directors approved, in principle,
the broad outline of the PLDT Group&#146;s strategic plans for 2007 to 2009 focusing
on the development of new revenue streams to drive future growth while
protecting the existing core communications business.  To ensure the proper
execution of the three-year plan, particularly with respect to the manpower
resources being committed to such plans, a new LTIP, or New LTIP, upon
endorsement of the Executive Compensation Committee, was approved by the Board
of Directors to cover the period from January 1, 2007 to December 31, 2009, or
New Performance Cycle.  As a result of the establishment of the New LTIP, the
Board also approved the early vesting of the Original LTIP by the end of 2006
for those of its participants who were invited to join the New LTIP and chose
to join.  Participants in the Original LTIP who were not invited to join the
New LTIP, or who were invited but chose not to join, remained subject to the
Original LTIP and its original vesting schedule.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Prior to January 1, 2006, we accounted for the LTIP using the intrinsic
value method supplemented by pro forma disclosures in accordance with APB
Opinion No. 25 and SFAS No. 123.  Effective January 1, 2006, we adopted SFAS
No. 123(R) using the modified prospective approach and accordingly prior
periods have not been restated to reflect the impact of SFAS No. 123(R).  The
cumulative effect of adoption of SFAS No. 123(R) was recognized separately in our
consolidated statements of income.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
fair value of the Original LTIP was estimated using an option pricing model,
which considered annual stock volatility, risk-free interest rates, the
remaining life of options and the share price capped at Php2,300.00 as at
December 31, 2006.  Incentive cost per share as at December 31, 2006 amounted
to Php1,350.00.  The Original LTIP cost, including the cost for advisors
(presented under professional and other service fees in the statements of
income) and the cumulative effect of the adoption of FAS 123 (R), recognized as
an expense as at December 31, 2006 and 2005, amounted to Php3,432 million and
Php1,224 million, respectively.  As at December 31, 2006 and 2005, total Original
LTIP liability amounted to Php5,030 million and Php1,880 million, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Movements in the number of share appreciation rights
outstanding under the Original LTIP awards are as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at beginning of year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,884,406</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,685,959</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cancellations/forfeitures</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(140,449)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(294,982)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Awards</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">493,429</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Balance at end of year</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,743,957</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.05pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,884,406</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Pension</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.25in;text-align:justify;text-indent:
..25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>PLDT</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT has a trustee-managed, non-contributory defined
benefit plan, or Benefit Plan, providing for retirement and death benefits and service terminal pay to
substantially all permanent and regular employees.  The Benefit Plan provides
benefits upon normal retirement beginning at age 65, early retirement beginning
at age 50 or completion of at least 30 years of credited service, voluntary
separation beginning at age 40 or completion of at least 15 years of credited
service, total and physical disability, death and involuntary separation.
Benefits under the Benefit Plan are based on the employee&#146;s final monthly basic
salary and length of service.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2006, PLDT adopted FAS 158, &#147;Employers&#146; Accounting for Defined Benefit Pension
and Other Postretirement Plans&#148;.  SFAS No. 158 requires the recognition of the
overfunded or unfunded status of a benefit plan, measured as the difference
between the fair value of the plan assets and the benefit obligations, as an
asset or liability in the consolidated balance sheet; it also requires that the
changes in the funded status be recorded through comprehensive income in the
year in which those changes occur.  Accordingly, we have recognized the
aggregate amount of Php4,718 million (Php3,303 million after tax effect)
unfunded plans in our 2006 consolidated balance sheet.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
conformity with SFAS No. 158, the following table sets forth the Plan&#146;s funded
status and pension amounts recognized as at December 31, 2006, 2005 and 2004
based on the latest actuarial valuation dated January 2007:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.54%;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-right:5.15pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:5.15pt;text-align:center;
 text-indent:33.8pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in
 million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:11.7pt'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in;height:11.7pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Change in benefit obligation:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Benefit obligation at beginning of year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,601</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,864</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,971</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Current service cost</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>461</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">427</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">382</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest cost</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>889</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">684</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">535</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Benefits paid</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(590)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(495)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(18)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Actuarial loss on obligation</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4,768</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">121</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">679</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Curtailment</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">116</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Settlement</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(801)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Benefit obligation at end of year</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>13,129</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7,601</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,864</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Change in plan assets:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fair value of plan assets at beginning of year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,154</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,448</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,927</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Actual return on plan assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>884</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">568</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">457</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Actual contribution</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>320</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">633</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">883</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Settlement</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(801)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Actual benefits paid</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(590)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(495)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:1.45pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(18)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fair value of plan assets at end of year</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>5,768</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,154</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,448</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Funded status</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(7,361)</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,447)</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,416)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Unrealized net transition obligation</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">189</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">199</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Unrecognized net actuarial gain</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">116</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">89</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Accrued benefit cost</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(7,361)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,142)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2,128)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Components of net periodic benefit cost:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Current service cost</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>461</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">427</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">382</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest cost</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>889</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">684</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">535</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Expected return on plan assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(540)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(540)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.0pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(376)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Amortizations of unrecognized net transition obligation</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>10</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Net periodic benefit cost</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b> 820</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 581</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.15pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 551</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
accumulated benefit obligations amounted to Php3,379 million, Php1,946 million
and Php2,868 million as at December 31, 2006, 2005 and 2004, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The significant assumptions used in determining the
actuarial present value of the projected benefit obligations as at December 31,
2006, 2005 and 2004 are as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.88%;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">Weighted average
 assumptions:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Expected rate of return on plan assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>10%</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Discount rate</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>8%</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11%</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Rate of compensation increase</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>8%</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">8%</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">7%</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
allocation of the fair value of the beneficial trust fund&#146;s assets for the PLDT
pension plan as at December 31, 2006, 2005 and 2004 follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Investments in equity
 securities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>52%</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">37%</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">33%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Investments in debt and
 fixed income securities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>23%</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">40%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">41%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Investments in real estate</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10%</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">13%</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">16%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Investments in mutual funds</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>8%</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">6%</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Investments in temporary
 placements</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>7%</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">4%</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">8%</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>100%</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">100%</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">100%</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
PLDT Group adopts an investment approach of mixed equity and fixed income
investments to maximize the long-term return of plan assets.  The investment
portfolio has been structured to achieve the objective of regular income with
capital growth and out-performance of benchmarks.  A majority of the investment
portfolio consists of fixed income debt securities and various equity
securities, while the remaining portion consists of multi-currency investments.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">SFAS
No. 87 requires the use of an average rate of earnings expected on funds
invested or to be invested, considering returns being earned by plan assets in
the fund and rates of return expected to be available for reinvestment.  Due
consideration was given not only to historical performance of plan investments,
but also to the current investment mix and anticipated rates of return.   Thus,
the expected rate of return on assets was set at 10% per annum.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006 and 2005, the assets of the beneficial trust fund
established for PLDT&#146;s pension plan include investments in shares of stocks of
PLDT and Piltel with total fair values aggregating Php2,185 million and
Php1,643 million, respectively, which represent about 35% and 29%,
respectively, of such beneficial trust fund&#146;s net assets available for plan
benefits (31% in 2004).</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Movements
of shares of stock of PLDT and Piltel held by the plan during 2006 are as
follows:</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.36%;background:#E0E0E0;border-collapse:collapse'>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;background:transparent;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:transparent;padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:6.3pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>PLDT</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:transparent;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:auto' style="margin-top:0;margin-bottom:0">Piltel</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:transparent;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:transparent;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Common Shares</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:transparent;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:auto' style="margin-top:0;margin-bottom:0">Preferred Shares</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:transparent;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Common Shares</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Numbers of shares held by
 the plan as at January 1, 2006</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">661,643</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">36,000,000</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">19,958,760</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Purchases
 during the year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Sales during the year</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Number of shares held by
 the plan as at December 31, 2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>661,643</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>36,000,000</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>19,958,760</b></p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Dividends
received by the plan from PLDT for the years ended December 31, 2006, 2005 and
2004 amounted to Php103 million, Php86 million and Php47 million, respectively.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style="margin-top:0;margin-bottom:0">PLDT expects to make
approximately Php509 million of cash contributions to its pension plan in 2007.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The table below presents the expected compulsory
retirement benefits of PLDT to be paid out of the fund for the next ten years:</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>
 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:38.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">73</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:38.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">100</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:38.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">131</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2010</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:38.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">180</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2011</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:38.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">274</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2012 and onwards</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:38.2pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,055</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Smart</i></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart has a trustee-managed, tax-qualified provident
plan, or Provident Plan, providing for retirement, death or service terminal
pay to substantially all permanent and regular employees.  Under the Provident
Plan, Smart contributes to the provident fund for the credit of each member&#146;s
Personal Retirement Account, or PRA, a percentage of such member&#146;s monthly
salary.  Net earnings of the Provident Fund are credited every nine months to
the PRAs of the members based on their proportionate share in the total value
of the Provident Fund as at the end of the preceding period.</p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
October 2003, Smart&#146;s Board of Directors approved certain enhancements to the
retirement plan.  The enhanced retirement plan gives a member the option to
contribute to the fund up to a maximum of 10% of his monthly salary.  On top of
its current contribution, Smart will provide an additional contribution of up
to 50% of the member&#146;s contribution, depending on his tenure in the company.</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart&#146;s total cash contributions to its plan for the
years ended December 31, 2006, 2005 and 2004 amounted to Php112, million, Php50
million and Php94 million, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>18.    Operating Revenues and
Expenses</b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<p style='margin-left:.5in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>Service Revenues</i></p>

<p style="margin-top:0;margin-bottom:0"><b><i>&nbsp;</i></b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.5pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Wireless
 services</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Cellular</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>75,747</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">71,518</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">65,818</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Very small aperture terminal, or VSAT</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,073</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,945</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,958</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Fixed lines</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Local exchange</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,860</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">20,210</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">20,606</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">International long distance</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>9,921</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">12,240</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">12,804</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">National long distance</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>6,874</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">5,232</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">6,736</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Data and other network</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>7,199</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">6,001</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">4,433</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Miscellaneous</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>474</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">441</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">535</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Information and communications technology</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,856</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2,761</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2,014</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>125,004</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">120,348</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">114,904</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>Non-service Revenues</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.7%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.5pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Sale of computers, cellular handsets and SIM-packs</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,101</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,752</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,111</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Point-of-product sales</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>431</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">235</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">158</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2,532</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2,987</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,269</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>Compensation and Employee Benefits</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.5pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Salaries and benefits</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>13,761</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,465</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,307</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Incentive plans (Note 17)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>3,104</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,195</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">308</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Pension and other benefits (Note 17)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>957</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">734</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">835</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">MRP (Note 11)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>445</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">458</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">566</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>18,267</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">13,852</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,016</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>Professional</i><i> and Other Contracted Services</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.5pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Technical and consultancy
 fees (Note 16)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,930</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,387</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,608</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Contracted services</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>948</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">470</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">403</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Legal and audit fees</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>219</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">508</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">132</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>47</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">67</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,144</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2,432</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2,187</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-align:justify;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><i>Asset Impairment</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.5pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Property, plant and equipment (Note 7)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,402</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">365</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Notes receivables (Note 8)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>346</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Intangibles (Note 9)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>30</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Investments (Note 8)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>4</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,047</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>17</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,799</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"> 11</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,412</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Financing
Costs</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse;width:100.78% !msorm;
 border-collapse:collapse !msorm'>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-top:solid windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.5pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Interest
 on loans and related items (Note 24)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>6,991</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">10,119</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">11,710</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Financing charges (Note 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,497</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,436</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,157</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Accretion on financial liabilities &#150; net (Notes 12
 and 23)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>338</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">568</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">1,185</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Capitalized interest (Notes 7 and 24)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(549)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">(504)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">(595)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.35pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Foreign exchange losses (gains) &#150; net (Notes 12 and
 23)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(5,818)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">(8,196)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2,776</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,459</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">3,423</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;
 border-left:none !msorm;border-bottom:double windowtext 1.5pt !msorm;
 border-right:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">16,233</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-align:justify' style="margin-top:0;margin-bottom:0"><i>Other Income &#150; Net</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.5pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Gain on early settlement of debt, debt exchange and
 debt restructuring transactions (Php9.21 per share and Php16.59 per share in
 2006 and 2004, respectively) (Notes 12 and 14)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,698</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,816</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Miscellaneous income
 (expense) &#150; net</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,897</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,016</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.7pt;text-align:right' style="margin-top:0;margin-bottom:0">(286)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,595</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,016</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,530</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">19.    Income Taxes</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The net current and noncurrent components of deferred income
tax assets (liabilities) recognized in the consolidated balance sheets follow:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.88%;border-collapse:collapse'>
 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> </p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:7.7pt;
 margin-bottom:0in;margin-left:4.65pt;margin-bottom:.0001pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million
 pesos)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Net current
 deferred income tax assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,042</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">9,866</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Net noncurrent deferred income tax assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,706</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">13,589</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Net current deferred income tax liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Net noncurrent deferred income tax liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(382)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(44)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The components of the consolidated net deferred income tax assets and
liabilities are as follows:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse;width:100.96% !msorm;border-collapse:
 collapse !msorm'>

 <tr style='height:5.7pt' style='height:5.7pt !msorm'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:5.7pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:5.7pt'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:5.7pt'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=top style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:0in;margin-right:7.7pt;
 margin-bottom:0in;margin-left:4.65pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Current assets:</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accumulated
 provision for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,813</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">5,531</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Unearned
 prepaid card revenues </p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,325</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">781</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">MCIT</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>983</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">526</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Provision
 for unrealizable assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>422</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">423</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Allowance
 for inventory obsolescence </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>323</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">337</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Capital
 lease</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>261</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">157</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Unamortized
 past service pension cost</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>154</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">170</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Executive
 stock option plan</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>106</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">104</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Unearned
 revenues &#150; others</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>78</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">798</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 financial instruments</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>33</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">67</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">NOLCO</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>7</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,622</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">1,459</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,127</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">10,362</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Current liabilities:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Unrealized
 foreign exchange gains on financial instruments</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(40)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,126</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">10,322</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:18.4pt;text-indent:-.25in' style="margin-top:0;margin-bottom:0">Less valuation allowance</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>84</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">456</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Net current assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,042</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">9,866</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Noncurrent assets:</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Asset impairment</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,631</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">8,398</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">NOLCO</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,987</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">3,931</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Unrealized foreign exchange losses</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,989</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">6,459</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Derivative financial instruments</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,331</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">692</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Accrued pension cost</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2,329</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">788</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">LTIP</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,595</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">520</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Unearned revenues &#150; others</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,262</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">1,388</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Unamortized past service pension cost</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>717</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">861</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Remaining excess of debt forgiven over value of
 consideration given</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>401</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">1,636</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Deferred charges</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>266</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">284</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Asset retirement obligations</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>191</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">157</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Capitalized taxes and duties &#150; net of amortization</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(446)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(516)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Intangible assets and fair value adjustments on
 assets acquired</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(328)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(254)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Fixed assets componentization</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(1,679)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(815)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Capitalized interest charges &#150; net of amortization</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(4,607)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(4,664)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Others</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>282</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:7.55pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.55pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.55pt'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,921</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 7.55pt'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">18,865</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Less
 valuation allowance</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>215</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">5,276</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Net
 noncurrent assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,706</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">13,589</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Current liabilities:</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Accumulated provision for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Current liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(5)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Noncurrent liabilities:</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.2pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:.3in;text-indent:-12.6pt' style="margin-top:0;margin-bottom:0">Unrealized foreign exchange losses</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(7)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(44)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Unearned
 revenues</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(</b><b>39</b><b>)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Intangible
 assets and fair value adjustments on assets acquired</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(336)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.35pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Noncurrent
 liabilities</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(382)</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(44)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Provision
for income tax consists of:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.96%;border-collapse:collapse'>
 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"> </p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:40.5pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Current</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,035</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right' style="margin-top:0;margin-bottom:0">8,583</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right' style="margin-top:0;margin-bottom:0">7,357</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">Deferred</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.1pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>(989)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.1pt;text-align:right' style="margin-top:0;margin-bottom:0">(3,734)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.1pt;text-align:right' style="margin-top:0;margin-bottom:0">(531)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:double windowtext 2.25pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>9,046</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right' style="margin-top:0;margin-bottom:0">4,849</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:5.1pt;text-align:right' style="margin-top:0;margin-bottom:0">6,826</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Mabuhay Satellite and SubicTel are
registered as Subic Bay Freeport Enterprises while ClarkTel is registered as a
Clark Special Economic Zone Enterprise under Republic Act No. 9337, or R.A.
7227, otherwise known as the Bases Conversion and Development Act of 1992.  As
registrants, Mabuhay Satellite, SubicTel and ClarkTel are entitled to all the
rights, privileges and benefits established thereunder including tax and
duty-free importation of capital equipment and a special income tax rate of 5%
of gross income, as defined in the R.A. 7227.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On December 22, 2000, the Philippine Board of
Investments, or BOI, approved ePLDT&#146;s registration as a new information
technology, or IT, service firm in the field of services related to its
internet data center on a pioneer status.  As such, ePLDT enjoys, among other
incentives, a six-year income tax holiday, or ITH, starting February 2001.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
October 31, 2006, the BOI approved ePLDT&#146;s application for pioneer status for
its new projects which included <i>Vitro</i>&#153; value-added services and
additional capacity of the Data Center, which entitles the company to another
six-year income tax holiday incentive for this activity.  The coverage period
of the new ITH is yet to be disclosed by the BOI.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Parlance is registered with the BOI as a new IT export
service firm in the field of customer interaction center on a pioneer status.
Under this registration, Parlance is entitled to certain tax incentives,
including an ITH for six years starting in June 2002.  Parlance is required to
comply with specific terms and conditions stated in its BOI registration.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">iPlus Intelligent Network, Inc., or
iPlus, is a wholly-owned subsidiary of ePLDT and is registered with the BOI as
a new IT service firm in the field of application service provider on a pioneer
status.  Under such registration, iPlus is entitled to a six-year ITH incentive
from the actual start of commercial operations until January 1, 2009.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Vocativ is registered with the Philippine Economic
Zone Authority, or PEZA, as an Ecozone Export Enterprise to develop and operate
a call center business that serves overseas clients by providing customer
relationship management services.  As a registered enterprise, Vocativ is
entitled to certain tax and non-tax incentives which include, among other
things, tax and duty-free importations, exemption from local tax and an ITH for
four years from start of commercial operations.  After the ITH period, Vocativ
is liable for a final tax, in lieu of all taxes after the expiration of its
incentives.  The final tax is computed at 5% of gross income less allowable
deductions as defined under R.A. No. 7916, &#147;The Special Economic Zone Act of
1995&#148;, and must be paid and remitted in accordance with the amendments
contained in R.A. No. 8748, as follows: (a) 3% to the Philippine Government;
and (b) 2% which will be directly remitted by the business establishments to
the treasurer&#146;s office of the municipality or city where the enterprise is
located.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">On December 5, 2005, Vocativ received
approval from PEZA for the adjustment of the start of commercial operations,
effectively extending the ITH expiration to the end of March 2006.  On June 30,
2006, PEZA approved an ITH extension for another year which effectively extends
the ITH expiration to April 2007.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">mySecureSign, Inc., or mSSI, is a
wholly-owned subsidiary of ePLDT and is registered with the BOI as a new IT
service firm in the field of services related to public key infrastructure on a
pioneer status. Under such registration, mSSI enjoys, among other incentives, a
six-year ITH from August 1, 2001 or the actual start of commercial operations,
whichever comes first.  mSSI started commercial operations on January 1, 2002.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Ventus is registered with the BOI as a
new IT export service firm in the field of customer interaction center on a
pioneer status.  Under this registration, Ventus is entitled to certain tax
incentives such as an ITH for six years starting March 2005.  In relation to
this, Ventus is required to comply with specific terms and conditions stated in
the BOI registration.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Two of Ventus&#146; call center projects are registered
with the BOI as a new IT export service firm in the field of customer
interaction center on a pioneer status.  Under this registration, Ventus&#146; Iloilo and Pasig call center projects are entitled to certain tax incentives such as an
ITH for six years starting March 2005 and August 2006, respectively.  In
relation to this, Ventus is required to comply with specific terms and
conditions stated in the BOI registration.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Digital
 Paradise is registered with the BOI as a new IT service firm in the field of
community access on a non-pioneer status.  Under the provisions of the
registration, Digital Paradise&#146;s sales generated from its own community access
activity and franchise fees are entitled to an ITH for a period of four years
beginning December 2002.  In December 2006, the BOI approved Digital Paradise&#146;s
application for a status upgrade from non-pioneer to pioneer, accordingly
extending the ITH period for another two years starting January 2007.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Level Up! was originally registered with the BOI as a
new IT service firm in the field of application service provider on a
non-pioneer status.  Under such registration, Level Up! is entitled to certain
tax incentives, which includes a four-year ITH from January 2003 and a tax
credit for taxes on duties on materials used in export products for ten years
starting January 2003.  In April 2004, the BOI approved Level Up!&#146;s request for
upgrading its status from non-pioneer to pioneer in connection with its IT
service activity in the field of application service provider for entertainment
and educational project.  Accordingly, the ITH period was extended from four to
six years.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">In September 2006, PEZA approved SPi&#146;s application for
registration as an ecozone information technology enterprise to provide IT
enabled services with emphasis on the creation of electronic discovery,
presentation of content in electronic information formats, data analysis,
capture, abstracting and data processing, design, development and
implementation of healthcare documentation solutions.  As a registered
enterprise, SPi is entitled to certain tax and non-tax incentives which
include, among other things, tax and duty-free importations, exemption from
local tax and an ITH for four years.  After the ITH period, SPi is liable for a
final tax, in lieu of all taxes after the expiration of its incentives.  The
final tax is computed at 5% of gross income less allowable deductions as
defined under R.A. 7916, &#147;The Special Economic Zone Act of 1995&#148;, and will be
paid and remitted in accordance with the amendments contained in R.A. 8748, as
follows: (a) 3% to the Philippine Government; and (b) 2% which will be directly
remitted by the business establishments to the treasurer&#146;s office of the
municipality or city where the enterprise is located.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Wolfpac is registered with the BOI as a new operator
of service provider applications.  Under the terms of its registration, it is
entitled to certain tax and non-tax incentives which include, among other
things, an ITH for four years starting February 2004.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Smart Broadband has three registered
activities with the BOI on a pioneer status, namely: (i) a new operator of
telecommunications systems (inter-exchange carrier for data services); (ii) new
information technology service firm in the field of providing internet
services; and (iii) a new operator of telecommunications facilities (nationwide
broadband wireless access).  Under the terms of these registrations, Smart
Broadband is entitled to certain tax and non-tax incentives which include,
among other things, an ITH for six years from February 2001, August 2001 and
July 2005, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Income
derived from non-registered activities with the BOI is subject to the normal
income tax rate enacted as at the balance sheet date.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">Consolidated tax incentives availed for the years ended
December 31, 2006, 2005 and 2004 amounted to Php142 million, Php235 million and
Php2,208 million, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">On May 24, 2005, the president of the Philippines signed into law Republic Act No. 9337, or R.A. 9337, amending certain sections of the
National Internal Revenue Code, which took effect on November 1, 2005.  R.A.
9337, among others, introduced the following changes:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">d.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
 The regular corporate income tax
rate for domestic corporations and resident/non-resident foreign corporations
increased from 32% to 35% effective November 1, 2005 and will be reduced to 30%
effective January 1, 2009.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">e.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The VAT rate increased from 10% to
12% effective February 1, 2006.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">f.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The input VAT on capital goods
should be spread evenly over the estimated useful life or sixty months,
whichever is shorter, if the acquisition cost, excluding the VAT component
thereof, exceeds one million pesos.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2006, the net movement in deferred tax assets primarily pertains to deferred
tax assets recognized in relation to the benefit that would be derived from the
disposal of certain Piltel assets with the expected lifting of a mortgage trust
indenture, or MTI, restrictions resulting from the full repayment of Pitel&#146;s
restructured debt on December 4, 2006.  For further discussion, please see <i>Note
12 &#150; Interest-bearing Financial Liabilities</i>.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Certain
of our valuation allowance on deferred income tax assets have been reversed to
the extent that such related deferred tax assets are expected to be utilized
against sufficient future taxable profit.  We had valuation allowance on deferred
tax assets of Php299 million and Php5,615 million largely pertaining to asset
impairment as at December 31, 2006 and 2005, respectively.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The balance of consolidated NOLCO as at December 31,
2006 may be used by the particular entities that incurred the losses as
deductions against their future taxable income as follows:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.64%;margin-left:.4pt;border-collapse:collapse'>
 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:1.0in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Year Incurred</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;margin-right:.05pt;
 margin-bottom:0in;margin-left:8.9pt;margin-bottom:.0001pt;text-align:center;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>Expiry Date</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:31.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2008</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:31.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,222</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">December 31, 2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:31.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,020</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Total NOLCO</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:31.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,268</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:31.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Tax benefit as at December 31, 2006</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.65pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:31.55pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,994</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
benefit of MCIT amounting to Php983 million as at December 31, 2006 can be claimed as
deductions against income tax payable until 2008.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
reconciliation between the provision for income tax at the applicable statutory
tax rates and the actual provision for
income tax is as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='margin-left:5.4pt;border-collapse:collapse'>
 <tr>
 <td  valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td  valign=top style=' border:none;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  colspan=3 valign=top style=' border:none;
 padding:0in 5.4pt 0in 5.4pt'>
 <p style="margin-top:0;margin-bottom:0">(in million
 pesos)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Provision for income tax at the applicable statutory tax rates</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>15,340</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">14,875</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">11,149</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Tax effects of:</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.1pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.1pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:14.2pt;text-indent:-7.1pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Tax exempt income and non-deductible
 expenses</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,410</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">445</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">3,731</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:14.2pt;text-indent:-7.1pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Differences between statutory tax rate
 and special tax rate <br>
 of certain subsidiaries</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,043</b></p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.1pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,507)</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.1pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(835)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:14.2pt;text-indent:-7.1pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Equity share in net losses (income) of
 associates</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>18</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.1pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:14.2pt;text-indent:-7.1pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Results of operations subject to income
 tax holiday and <br>
 other non-taxable income</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(1,674)</b></p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.1pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,234)</p>
 </td>
 <td  valign=bottom style=' background:#F3F3F3;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.1pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(1,316)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p style='margin-left:14.2pt;text-indent:-7.1pt;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0">Changes in valuation allowance</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;padding:
 0in 5.4pt 0in 5.4pt'>
 <p align=right style='text-align:right;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>(7,091)</b></p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.1pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(7,728)</p>
 </td>
 <td  valign=bottom style=' background:#E0E0E0;
 padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:5.1pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">(5,927)</p>
 </td>
 </tr>
 <tr>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Actual provision for income tax</p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>9,046</b></p>
 </td>
 <td  valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">4,849</p>
 </td>
 <td  valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 5.4pt 0in 5.4pt'>
 <p align=right style='margin-right:8.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">6,826</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

</div>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>20.    Earnings Per Common Share</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">The
following table presents information necessary to calculate the earnings per
share:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.26%;margin-left:.4pt;border-collapse:collapse;width:100.26% !msorm;
 border-collapse:collapse !msorm'>

 <tr style='page-break-inside:avoid;height:7.1pt' style='page-break-inside:
 avoid !msorm;height:7.1pt !msorm'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in;border:none !msorm;border-top:solid windowtext 1.5pt !msorm;
 padding:0in 0in 0in 0in !msorm;height:7.1pt'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:7.1pt'>
 <p align=center style='margin-top:0in;margin-right:2.9pt;
 margin-bottom:0in;margin-left:17.95pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:7.1pt'>
 <p align=center style='margin-top:0in;margin-right:4.55pt;
 margin-bottom:0in;margin-left:17.95pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.5pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:7.1pt'>
 <p align=center style='margin-top:0in;margin-right:4.55pt;
 margin-bottom:0in;margin-left:17.95pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Basic</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Diluted</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Basic</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Diluted</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=6 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos, except per share amounts)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Consolidated net income</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>33,598</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>33,598</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,603</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">28,101</p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p style='margin-left:45.0pt;text-indent:-45.0pt' style="margin-top:0;margin-bottom:0">Dividends on preferred stock</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(572)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(572)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,677)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(70)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,764)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(285)</p>
 </td>
 </tr>
 <tr style='height:10.35pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.35pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Accretion to redemption value of Preferred Stock
 Subject <br>
 to Mandatory Redemption and foreign exchange revaluation</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(765)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(765)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,443)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,746)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,503)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 10.35pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,503)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Consolidated net income attributable to common
 shareholders</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>32,261</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>32,261</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37,483</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">38,787</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">24,834</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">26,313</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=6 valign=bottom style=' border:none;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in thousand shares)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:45.0pt;text-indent:-45.0pt' style="margin-top:0;margin-bottom:0">Outstanding common shares at beginning of year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>180,789</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>180,789</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">170,214</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">170,214</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">169,476</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">169,476</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:45.0pt;text-indent:-45.0pt' style="margin-top:0;margin-bottom:0">Effect of issuance of common shares during the year</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,667</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,667</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,855</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,855</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">252</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Average incremental number of shares under ESOP <br>
 during the year</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">94</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">155</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Common shares equivalent of preferred shares deemed
 dilutive:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">      10% Cumulative Convertible Preferred Stock
 (Note 14)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,617</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,305</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">      Preferred Stock Series III (Note 14)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7,908</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">      Preferred Stock Series VI (Note 14)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,399</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">      Preferred Stock Series VII (Note 14)</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,842</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Weighted average number of common shares for the year</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>184,456</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>184,456</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">172,069</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">183,021</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">169,728</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">181,096</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.4pt;text-indent:-9.4pt' style="margin-top:0;margin-bottom:0">Earnings per common share</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php174.90</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php174.90</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php217.84</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php211.93</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php146.32</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php145.30</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Series III, V, VI and VII Convertible Preferred Stock
and 10% Cumulative Convertible Preferred Stock were deemed dilutive based on a
calculation of the required dividends on each
respective preferred shares divided by the number of equivalent common
shares, assuming such preferred shares are converted into common shares and
compared against the basic EPS.  Since the amount of dividends on Series VI and
VII Convertible Preferred Stock in 2005 and Series III Convertible Preferred
Stock in 2004, including 10% Cumulative Convertible Preferred Stock in both
years, over its equivalent number of common shares decreased the basic EPS,
these convertible preferred stocks were deemed dilutive.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
computation of diluted earnings per common share were anti-dilutive for the
year ended December 31, 2006, therefore, the amounts reported for basic and
diluted earnings per common share were the same.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b>Dividends Declared For the
Years Ended December 31, 2006, 2005 and 2004</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.04%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2005</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2004</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Class</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Per Share</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Per Share</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Per Share</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=center style='margin-bottom:1.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=center style='margin-bottom:1.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>(in million pesos)</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=center style='margin-bottom:1.0pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=center style='margin-bottom:1.0pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=center style='margin-bottom:1.0pt;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=center style='margin-bottom:1.0pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Preferred Stock Subject to <br>
 Mandatory Redemption</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 V</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php4.675</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php4.675</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php4.675</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">48</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 VI</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$0.09925</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>71</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$0.09925</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">102</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$0.09925</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">106</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 VII</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>JPY10.179725</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>59</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">JPY10.179725</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">78</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">JPY10.179725</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">82</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 132</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"> 201</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0"> 236</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>10% Cumulative Convertible <br>
 Preferred Stock</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 CC</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php1.00</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>17</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 DD</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1.00</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">2</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 A, I, R, W, AA and BB</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1.00</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>128</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">129</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">130</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 B, F, Q, V and Z</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1.00</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>90</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">91</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">91</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series E, K, O and U</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1.00</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>45</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">44</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 C, D, J, T and X</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1.00</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>58</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">58</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">58</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 G, N, P and S</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1.00</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>26</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">27</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">27</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 H, L, M and Y</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1.00</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>40</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">40</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 407</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"> 409</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0"> 410</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Convertible Preferred
 Stock</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 III</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$1.029412</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">968</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$1.029412</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">1,070</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Cumulative Non-Convertible Redeemable Preferred Stock</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 IV*</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>49</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">49</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">48</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Common Stock</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php50.00</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>9,379</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php14.00</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">2,384</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>28.00</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>5,080</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">21.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">3,598</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">21.00</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">3,642</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>14,459</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">9,624</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=top style=' border:none;border-bottom:double windowtext 1.5pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Charged
 to retained earnings</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>15,047</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.55pt;text-align:right' style="margin-top:0;margin-bottom:0">11,251</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">1,764</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>*       </i><i>Dividends are declared based on total amount paid up.</i></p>

<p style='margin-left:9.0pt;text-indent:-9.0pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><b>Dividends Declared After
December 31, 2006</b></p>

<p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:99.96%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:6.6pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:6.6pt'>
 <p style='margin-top:3.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=3 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:6.6pt'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Date</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:6.6pt'>
 <p align=center style='margin-top:3.0pt;margin-right:2.9pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Amount</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Class</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Approved</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Record</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Payable</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Per Share</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:3.0pt;margin-right:.05pt;
 margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:3.0pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=right style='margin-top:0in;margin-right:0in;
 margin-bottom:1.0pt;margin-left:40.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:3.0pt'>
 <p align=center style='margin-bottom:1.0pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Preferred Stock Subject to Mandatory Redemption</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 V</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 6, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 20, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 15, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php4.675</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 12, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 28, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">July 15, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php4.675</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 VI</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 6, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 20, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 15, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$0.09925</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">4</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 12, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 28, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">July 15, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$0.09925</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">   7</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>10% Cumulative Convertible Preferred Stock</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 CC</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">January 30, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 28, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 30, 2007</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php1.00</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 DD</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">January 30, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 15, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 28, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 EE</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 27, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 26, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">May 31, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1.00</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">  19</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>Cumulative Non-Convertible Redeemable Preferred Stock</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">Series
 IV*</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">January 30, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">February 23, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 15, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">May 8, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">May 25, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">June 15, 2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">12</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">  24</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=top style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Common Stock</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 6, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">March 20, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">April 20, 2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php50.00</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0">9,428</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-indent:9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:26.55pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>9,478</b></p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>*       </i><i>Dividends are declared based on total amount paid up.</i></p>

<p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">21.    Contractual Obligations and Commercial
Commitments</p>

<p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style="margin-top:0;margin-bottom:0"><b><i>Contractual Obligations</i></b></p>

<p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
following table discloses the PLDT Group&#146;s contractual obligations outstanding
as at December 31, 2006: </p>

<p style='margin-left:9.0pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Long-term lease obligations</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Unconditional purchase</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Other long-term</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Long-term debt</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Operating</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Capital</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>obligations</b><b>(1)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:7.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>obligations</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:8.25pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=6 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right' style="margin-top:0;margin-bottom:0">16,316</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right' style="margin-top:0;margin-bottom:0">572</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right' style="margin-top:0;margin-bottom:0">1,521</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right' style="margin-top:0;margin-bottom:0">4,972</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right' style="margin-top:0;margin-bottom:0">23,381</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
 normal' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right' style="margin-top:0;margin-bottom:0">7,759</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right' style="margin-top:0;margin-bottom:0">593</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right' style="margin-top:0;margin-bottom:0">38</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right' style="margin-top:0;margin-bottom:0">981</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right' style="margin-top:0;margin-bottom:0">1,629</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right' style="margin-top:0;margin-bottom:0">11,000</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right' style="margin-top:0;margin-bottom:0">14,978</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right' style="margin-top:0;margin-bottom:0">564</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right' style="margin-top:0;margin-bottom:0">10</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right' style="margin-top:0;margin-bottom:0">981</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right' style="margin-top:0;margin-bottom:0">16,533</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2010</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right' style="margin-top:0;margin-bottom:0">4,834</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right' style="margin-top:0;margin-bottom:0">465</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right' style="margin-top:0;margin-bottom:0">981</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right' style="margin-top:0;margin-bottom:0">6,281</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2011</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right' style="margin-top:0;margin-bottom:0">1,279</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right' style="margin-top:0;margin-bottom:0">358</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right' style="margin-top:0;margin-bottom:0">981</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right' style="margin-top:0;margin-bottom:0">2,618</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">2012
 and onwards</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right' style="margin-top:0;margin-bottom:0">40,692</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right' style="margin-top:0;margin-bottom:0">868</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right' style="margin-top:0;margin-bottom:0">1,962</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right' style="margin-top:0;margin-bottom:0">43,522</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0"><b>Total
 </b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.45pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>85,858</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:17.95pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>3,420</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:13.35pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,570</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:25.8pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,858</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.4pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,629</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 2.25pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:6.7pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>103,335</b></p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i> (1)</i><i>   Based on the Original Air Time Purchase Agreement
with AIL</i></p>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Long-term Debt Obligations</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">For a discussion of our long-term debt obligations<i>,</i>
see<i> Note 12 &#150; Interest-bearing Financial Liabilities.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Long-term Operating Lease Obligations</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Digital Passage Service Contracts.</i>   PLDT has existing Digital Passage Service Contracts
with foreign telecommunication administrations for several dedicated circuits
to various destinations for ten to 25 years expiring at various dates.  As at
December 31, 2006, PLDT&#146;s aggregate remaining obligation under these contracts
amounted to approximately Php6 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>License
Agreement with Mobius Management Systems (Australia) Pty Ltd., or Mobius.  </i>PLDT entered into a license agreement with Mobius
pursuant to which Mobius has granted PLDT a non-exclusive, non-assignable and
non-transferable license for the use of computer software components.  Under
this agreement, Mobius is also required to provide maintenance services for a
period of one year at no additional maintenance charge.  PLDT may purchase
maintenance services upon expiration of the first year for a fee of 15% of the
current published license fee.  As at December 31, 2006, PLDT&#146;s aggregate
remaining obligation under this agreement was approximately Php10 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Other Long-term Operating Lease Obligations</i>.   The PLDT Group has various long-term lease
contracts for periods ranging from two to ten years covering certain offices,
warehouses, cell sites telecommunication equipment locations and various office
equipment.  In particular, Smart has lease obligations amounting to Php3,053
million as at December 31, 2006 in respect of office and cell site rentals with
over 3,000 lessors nationwide, PLDT has lease obligations amounting to Php100
million as at December 31, 2006 in respect of office and lot rentals with over
185 lessors nationwide, ePLDT has lease obligations amounting to Php238 million
as at December 31, 2006 in respect of certain office space rentals and PLDT
Global has lease obligations amounting to Php13 million as at December 31, 2006
in respect of certain office space rentals.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Long-term
Capital Lease Obligations</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">For a
discussion of our long-term capital lease obligations, see <i>Note 12 &#150;
Interest-bearing Financial Liabilities</i>.</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Unconditional Purchase Obligations</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Air Time Purchase Agreement with AIL.  </i>See <i>Note 16 &#150; Related Party Transactions</i>, for a
discussion of PLDT&#146;s obligations under the Original ATPA and the Amended ATPA.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, PLDT&#146;s aggregate remaining minimum obligation under the Original
ATPA was approximately Php10,858 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Other Long-term Obligations</i></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Mandatory
Conversion and Purchase of Shares</i>.
As discussed in <i>Note 14 &#150; Preferred Stock Subject to Mandatory Redemption</i>,
PLDT had issued a total of 3 million shares of Series V Convertible Preferred
Stock, 5 million shares of Series VI Convertible Preferred Stock and 4 million
shares of Series VII Convertible Preferred Stock in exchange for a total of 58
million shares of Series K Class I Convertible Preferred Stock of Piltel,
pursuant to the debt restructuring plan of Piltel adopted in June 2001.  As at
December 31, 2006, 2,675,393 shares of Series V Convertible Preferred Stock,
4,419,916 shares of Series VI Convertible Preferred Stock and all of the
3,842,000 shares of the then outstanding Series VII Convertible Preferred Stock
had been voluntarily converted to PLDT common shares.  As at December 31, 2006,
46,047 shares of Series V and 875,188 shares of Series VI Convertible Preferred
Stocks remained outstanding.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Each
share of Series V and VI Convertible Preferred Stock is convertible at any time
at the option of the holder into one PLDT common share.  On the date
immediately following the seventh anniversary of the issue date of the Series V
and Series VI Convertible Preferred Stocks, the remaining outstanding shares
under these series will be mandatorily converted to PLDT common shares.  Under
a put option exercisable for 30 days, holders of common shares received on
mandatory conversion of the Series V and VI Convertible Preferred Stocks will
be able to require PLDT to purchase such PLDT common shares for Php1,700 per
share and US$36.132 per share, respectively.  </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">The aggregate value of the put option based on
outstanding shares as at December 31, 2006 was Php1,629 million which is
puttable on June 4, 2008, if all of the outstanding shares of Series V and VI
Convertible Preferred Stocks were mandatorily converted and all the common
shares were put to PLDT at that time.  The market value of the underlying
shares of common stock was Php2,349 million, based on the market price of PLDT
common shares of Php2,550.00 per share as at December 31, 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Commercial Commitments</i></b></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">As at December 31, 2006, our outstanding commercial
commitments, in the form of letters of credit, amounted to Php1,546 million.
These commitments will expire within one year.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other;border:none;padding:0in' style="margin-top:0;margin-bottom:0"><b>22.    Provisions and
Contingencies</b></p>

</div>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As discussed below, we currently expect that going
forward, we will pay local franchise taxes on an annual basis and based on the
gross receipts received or collected for services rendered within the
jurisdiction of the respective taxing authority.  For this reason, we have made
the appropriate provisions in our consolidated financial statements as at
December 31, 2006.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>NTC
Supervision and Regulation Fees, or SRF</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Since
1976, PLDT has received assessments from NTC for permit, SRF and other charges
pursuant to Section 40 of Commonwealth Act 146, otherwise known as the Public
Service Act.  As at December 31, 2006, since 1994, PLDT has paid a total amount
of Php2,219 million in SRF, of which Php1,956 million was paid under protest.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT is contesting the manner by which these
assessments were calculated and the basis for such calculations.  The case is
now with the Supreme Court and, upon the rules and practice of court, stands
submitted for decision.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Local Business and Franchise Tax Assessments</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">PLDT is presently a party to several cases involving
the issue of exemption of PLDT from local franchise and business taxes.  PLDT
believes, based on the opinion of its legal counsel, that it is exempt from
payment of local franchise and business taxes. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The Local Government Code of 1991, or
Republic Act (R.A.) 7160, which took effect on January 1, 1992, extended to
local government units, or LGUs, the power to tax businesses within their
territorial jurisdiction granted under Batas Pambansa 337, and withdrew tax
exemptions previously granted to franchise grantees under Section 12 of R.A.
7082. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT believes, based on the opinion of its legal
counsel, that R.A. 7925, which took effect on March 16, 1995, and the grant of
local franchise and business taxes exemption privileges to other franchise
holders subsequent to the effectivity of R.A. 7160, implicitly restored its
local franchise and business taxes exemption privilege under Section 12 of R.A.
7082, or the PLDT Franchise pursuant to Section 23 thereof or the equality of
treatment clause. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">To confirm this position, PLDT sought and obtained on
June 2, 1998 a ruling from the Bureau of Local Government Finance, or BLGF, of
the Philippine Department of Finance, which ruled that PLDT is exempt from the
payment of local franchise and business taxes imposable by LGUs under R.A.
7160.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">By virtue of the BLGF Ruling, PLDT stopped paying
local franchise and business taxes starting with the fourth quarter of 1998 and
has filed with certain LGUs claims for tax refund covering the period from the
second quarter of 1995 to the third quarter of 1998.  PLDT has received
assessments for local franchise and business taxes from several cities and
provinces following PLDT&#146;s decision to stop payment of local franchise and
business taxes.  </p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Following a decision of the Supreme Court on March 25,
2003, a judgment in the amount of Php4 million against PLDT involving the City
of Davao became final and executory on April 9, 2003, pursuant to which PLDT
was declared not exempt from the local franchise tax.  Pursuant to said
decision, PLDT has voluntarily paid the total amount of Php15 million for the
period from the fourth quarter of 1998 until December 31, 2003, which includes
the Php4 million subject of the case.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT had no longer contested assessments of LGUs for
franchise taxes as at December 31, 2006.  However, PLDT continues to contest
the validity of the assessment of penalties and surcharges of Php1.3 million
and Php2.3 million, by the City of Ozamiz and the Province of Bulacan,
respectively, for the years 1998 to 2002 when PLDT refrained from payment of local
franchise taxes upon its reliance in good faith on the BLGF Ruling that it is
exempt from local franchise tax.  PLDT is also contesting the validity of the
assessment of local franchise tax of Php2.8 million by the Province of Cagayan on the gross receipts received or collected by PLDT in Tuguegarao City wherein franchise tax was already paid to the latter.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT likewise continues to contest the imposition of
local business taxes in addition to local franchise tax by the Cities of
Tuguegarao, Balanga and Caloocan in the amounts of Php1.9 million, Php0.2
million and Php6.2 million, respectively, for the years 1998 to 2003 for the
City of Tuguegarao, and for the years 2005 to 2007 for the Cities of Balanga
and Caloocan.  PLDT is likewise contesting the imposition of a business tax on
the transmission of messages by the Municipality of San Pedro in the amount of
Php0.3 million for the years 2005 to 2007.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT currently expects that going forward it will pay
local franchise and business taxes on an annual basis and based on the gross
receipts received or collected for services rendered within the jurisdiction of
the respective taxing authority.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Smart has paid local business and
franchise taxes to certain cities and provinces in the aggregate amount of
Php313 million under protest.  Smart&#146;s legal position is that it is not liable
to pay the local franchise tax by virtue of Smart&#146;s exemption under its
legislative franchise under R.A. 7294, which took effect after the effective
date of the Local Government Code of 1991, or R.A. 7160.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The Regional Trial Court, or RTC, of Makati has declared Smart exempt from payment of local franchise tax to the City of Makati in a decision rendered in the case entitled <i>Smart Communications, Inc. vs. City
of Makati </i>(Civil Cases No. 02-249 and 02-725, August 3, 2004).  The City of
 Makati has filed a Motion for Extension to file a Petition for Review with
the Court of Appeals.  However, on June 9, 2005, the Court of Appeals dismissed
the appeal filed by the City of Makati.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The RTC of Iloilo has likewise ruled in a
decision dated January 19, 2005 that Smart is exempt from payment of local
franchise tax to the City of Iloilo.  The City of Iloilo has filed an appeal
directly with the Supreme Court, which remains pending.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Piltel&#146;s
Bureau of Internal Revenue, or BIR, Assessment</i></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;text-indent:0in' style="margin-top:0;margin-bottom:0">Piltel has received the following assessment notices
from the BIR:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0"><b>Year</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0"><b>Tax Assessment Type</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Basic</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Interest</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-top:0in;;
 margin-bottom:0in;margin-left:40.55pt;margin-bottom:.0001pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">1998</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Value Added Tax, or VAT</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">85.8</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">68.7</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0"> 154.5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Overseas Communications Tax, or OCT</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">31.8</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">25.5</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  57.3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Income Tax</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">12.4</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">9.4</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  21.8</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Administrative Penalties</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">0.1</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">   0.1</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">1999</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">VAT</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">94.5</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">67.8</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0"> 162.3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Income Tax</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">22.7</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">13.8</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  36.5</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">2001</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">VAT</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">56.2</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">35.1</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  91.3</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-top:0in;margin-right:.05in;margin-bottom:
 0in;margin-left:9.35pt;margin-bottom:.0001pt;text-indent:-9.35pt' style="margin-top:0;margin-bottom:0">Income Tax</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">13.4</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0">8.9</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:9.05pt;text-align:right' style="margin-top:0;margin-bottom:0">  22.3</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On December 12, 2005, Piltel filed a collective
application for a compromise settlement with the BIR for the deficiency tax
assessments arising from taxable years 1998, 1999 and 2001, citing &#147;reasonable
doubt as to the validity of the tax assessments&#148; as a basis.  The prescribed
minimum percentage of the compromise settlement for such basis is 40% of the
basic assessed tax.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">On January 27, 2006, Piltel received the favorable
recommendation and approval from the BIR on the said application for a
compromise settlement.  On January 31, 2006, Piltel settled the total amount of
Php114 million, which is equivalent to 40% of the basic taxes per final
assessment notices received, to effect the immediate cancellation of the tax
assessments.  On February 24, 2006, the BIR accepted Piltel&#146;s application for a
compromise settlement of income taxes and VAT for the years 1998, 1999 and
2001, and issued the Certificate of Availment on the said date.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0"><i>Enhanced
Voluntary Assessment Program, or EVAP, Availment</i></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2005, the BIR launched the EVAP, which grants taxpayers who availed themselves
of the program and are qualified the privilege of the last priority in BIR
audit and investigation.  The EVAP applies to all internal revenue taxes covering
the taxable year ending December 31, 2004 and all prior years, including
one-time taxes such as estate tax, donor&#146;s tax, capital gains tax, expanded
withholding tax and documentary stamp tax on the transfer, sale, exchange, or
disposition of assets, and likewise applies to taxpayers enjoying preferential
tax treatment.  A taxpayer who has availed himself of the EVAP and is qualified
to avail himself will not be audited except upon prior authorization and
approval of the Commissioner of Internal Revenue when there is strong evidence
or a finding of understatement in the payment of a taxpayer&#146;s correct tax
liability by more than 30%, as supported by a written report of the appropriate
office stating in detail the facts and the law on which such finding is based.
However, any EVAP payment should be allowed as tax credit against deficiency
tax due, if any, in case the concerned taxpayer has been subjected to a tax
audit. </p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
availed itself of the program and paid a total of Php6 million for VAT and income
tax for taxable year 2004, and VAT and withholding tax for taxable year 2002.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Maratel availed itself of the EVAP for income tax for
the taxable year 2004, SubicTel availed itself the program for its income tax,
withholding tax and percentage tax for taxable year 2002 and ClarkTel availed itself
of the program for its income tax for both taxable years 2003 and 2004.  The
total payment of Maratel, SubicTel and ClarkTel amounted to Php800,000.
Smart&#146;s EVAP availment, for which Php53 million was paid, covered the income
tax for the taxable years 2003 and 2004, the VAT for the taxable year 2002, the
OCT for the year 2002, and the withholding taxes for the taxable years 2002,
2003 and 2004.  Meanwhile, Piltel&#146;s EVAP availment, which involved payment of
Php3 million, covered its income tax for the taxable year 2003 and its expanded
withholding tax for the taxable years 2003 and 2004.  On August 2, 2006, Smart
received its Certificate of Qualification, or CQ, for the EVAP availment for
income tax, VAT, OCT and withholding taxes for taxable year 2002.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">With
the exception of SubicTel and ClarkTel, whose EVAP CQ were issued on September
13, 2006 and December 10, 2006, respectively, PLDT and other subsidiaries are
awaiting for their respective EVAP CQ to be issued by the BIR.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Improved
Voluntary Assessment Program, or IVAP, Availment</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
2006, the BIR launched the IVAP, which similarly grants taxpayers who availed
themselves of the program and are qualified the privilege of the last priority
in BIR audit and investigation.  The IVAP applies to all internal revenue taxes
covering the taxable year ending December 31, 2005 and fiscal year ending on
any day not later than June 30, 2006 and all prior years, including one-time taxes
such as estate tax, donor&#146;s tax, capital gains tax, expanded withholding tax
and documentary stamp tax on the transfer, sale, exchange, or disposition of
assets, and likewise applies to taxpayers enjoying preferential tax treatment.
Unlike under the EVAP, however, under the IVAP, taxpayers who avail themselves
of the same will no longer be subject to tax audit except in the case of fraud
manifested through understatement of the correct tax liability by more than
30%.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart availed itself of the IVAP for its income tax
and VAT for the taxable year 2005 and paid a total amount of Php40 million to
the BIR.  Maratel availed itself of the IVAP for the taxable years 2004 and
2005 for its income, VAT, percentage and withholding taxes, while SubicTel
availed itself of the program for the taxable year 2004 for its income and
value added taxes only and for the taxable year 2005 for its income, VAT and
withholding taxes.  ClarkTel availed itself of the IVAP for the taxable years
2003, 2004, 2005 for income and withholding taxes, except for income taxes for taxable
years 2003 and 2004, for which an EVAP CQ covering these taxable periods was
already issued.  The total collective IVAP payments for Maratel, SubicTel and
ClarkTel amounted to Php12 million.</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Air Time Purchase Agreement with AIL</i></p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><a name="OLE_LINK67"></a><a
name="OLE_LINK66">See <i>Note 16 &#150; Related Party
Transactions </i>and <i>Note 21 &#150; Contractual Obligations and Commercial
Commitments</i> for a discussion of PLDT&#146;s obligations under the Original ATPA
and the Amended ATPA.</a></p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;border:none;padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>23.    Financial Assets and
Liabilities</b></p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Our financial assets and liabilities are recognized
initially at fair value.  Transaction costs (debt issuance costs) are included
in the initial measurement of all financial assets and liabilities except those
classified as financial instruments measured at fair value through profit and
loss.  Subsequent to initial recognition, assets and liabilities are either
valued at amortized cost using the effective interest rate method or at fair
value depending on classification.</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
following table sets forth the carrying values and estimated fair values of our
financial assets and liabilities recognized as at December 31, 2006 and 2005.
There are no material unrecognized financial assets and liabilities as at
December 31, 2006 and 2005.</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.12%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:11.55pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:11.55pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.55pt'>
 <p align=center style='margin-left:40.55pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Carrying Value</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.55pt'>
 <p align=center style='margin-left:40.55pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Fair Value</b></p>
 </td>
 </tr>
 <tr style='height:11.65pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.65pt'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:11.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.5pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:11.5pt'>
 <p align=center style='margin-left:45.05pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='height:9.45pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:11.7pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.7pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Cash
 and cash equivalents</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,870</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">30,059</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,870</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">30,059</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Short-term
 investments</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>8,327</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,750</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>8,327</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,750</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.15in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Trade
 and other receivables</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,158</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7,856</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,158</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7,856</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>47</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>47</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr style='height:9.8pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.8pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 current financial assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>35,402</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,702</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>35,402</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,702</p>
 </td>
 </tr>
 <tr style='height:11.6pt'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:11.6pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Financial
 Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:11.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:11.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:11.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:11.6pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:8.55pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Investments
 - available-for-sale(1)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>116</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>116</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:8.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 </tr>
 <tr style='height:6.3pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 6.3pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>434</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>434</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 6.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 </tr>
 <tr style='height:7.55pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 7.55pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 noncurrent financial assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 7.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 550</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 7.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,757</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 7.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 550</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 7.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,757</p>
 </td>
 </tr>
 <tr style='height:8.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0"><b>Total
 Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>35,952</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">43,459</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>35,952</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:8.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">43,459</p>
 </td>
 </tr>
 <tr style='height:9.3pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.3pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:9.3pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Financial
 Liabilities</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:4.95pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Accounts payable</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>8,347</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,966</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>8,347</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,966</p>
 </td>
 </tr>
 <tr style='height:4.95pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Current portion of long-term debt(2)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,316</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,797</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,971</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.95pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">19,435</p>
 </td>
 </tr>
 <tr style='height:9.45pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Obligations under capital lease(2)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>924</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">753</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>924</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">753</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Notes payable(2)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>201</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>201</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Derivative liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>108</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>108</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 .1in'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Dividends payable</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>777</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">746</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>777</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 .1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">746</p>
 </td>
 </tr>
 <tr style='height:8.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.45pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 current financial liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>26,673</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">36,454</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>27,328</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 8.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37,092</p>
 </td>
 </tr>
 <tr style='height:4.85pt'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:4.85pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Financial
 Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:4.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:4.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in;height:4.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;height:4.85pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Long-term
 debt &#150; net of current portion(2)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>69,542</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">93,516</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>69,028</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">92,811</p>
 </td>
 </tr>
 <tr style='height:9.45pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Obligations
 under capital lease(2)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>106</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">344</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>106</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">344</p>
 </td>
 </tr>
 <tr style='height:.1in'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>6,872</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,777</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>6,872</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,777</p>
 </td>
 </tr>
 <tr style='height:9.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p style='margin-left:.25in;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Preferred stock subject to mandatory redemption</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,374</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">12,004</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,528</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">14,053</p>
 </td>
 </tr>
 <tr style='height:10.7pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 10.7pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 noncurrent financial liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 10.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>77,894</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 10.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">111,641</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 10.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>77,534</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 10.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">112,985</p>
 </td>
 </tr>
 <tr style='height:7.55pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.55pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0"><b>Total
 Financial Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>104,567</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">148,095</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>104,862</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 height:7.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">150,077</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-bottom:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><i>(1)      </i><i>Pertains to investments in club shares.</i></p>

<p style="margin-top:0;margin-bottom:0"><i>(2)      </i><i>Included under &#147;Interest-bearing Financial Liabilities&#148;
in the consolidated balance sheets.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">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:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest-bearing Financial Liabilities:</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Long-term debt:</i>
Fair value is based on the following:</p>

<p align=right style='text-align:right;text-indent:.5in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=1 cellspacing=0 cellpadding=0
 style='width:100.54%;margin-left:.4pt;border-collapse:collapse;border:none'>
 <tr>
 <td   valign=bottom style=' border:solid windowtext 1.0pt;
 border-top:solid windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Debt Type</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center;page-break-after:
 avoid' style="margin-top:0;margin-bottom:0"><b>Fair Value Assumptions</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 border-top:none;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Fixed Rate Loans:</p>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">U.S. dollar notes/convertible debt</p>
 <p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Other loans in all other currencies</p>
 </td>
 <td   valign=bottom style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Quoted market price.</p>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Estimated fair value is based on the discounted value
 of future cash flows using the applicable LIBOR and MART1 rates for similar
 types of loans.</p>
 </td>
 </tr>
 <tr>
 <td   valign=top style=' border:solid windowtext 1.0pt;
 border-top:none;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Variable Rate Loans</p>
 </td>
 <td   valign=bottom style=' border-top:none;border-left:
 none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:2.9pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">The carrying value approximates fair value because of
 recent and regular repricing based on market conditions.</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Preferred stock subject to mandatory redemption:</i> The fair values were determined using a discounted
cash flow model.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Derivative
instruments:</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Forward
foreign exchange contracts and bifurcated foreign currency forwards:</i> The fair values were determined using forward exchange
market rates at the balance sheet date.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Foreign
currency options:</i>  The fair values
were computed using an option pricing model.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Foreign
currency and interest rate swaps:</i>
The fair values were computed as the present value of estimated future cash flows.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Bifurcated equity call options:  </i>The fair values were computed using an option pricing
model.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">Due to the short-term nature of the transactions, the
fair value of cash and cash equivalents, short-term investments, trade and
other receivables, notes payable and accounts payable approximate the carrying
amounts as of the balance sheet date.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Derivative Financial Instruments</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">Our derivative financial
instruments are accounted for under non-hedge accounting.  Changes in the fair
value of these instruments are recognized directly to income for the period.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">The table below sets out the
information about our derivative financial instruments as at December 31, 2006
and 2005:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.7%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:10.25pt'>
 <td   colspan=2 valign=bottom style=' border:none;
 border-top:solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:10.25pt'>
 <p align=center style='margin-top:3.0pt;text-align:center' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid' style='page-break-inside:avoid !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='margin-top:0in;margin-right:9.35pt;
 margin-bottom:0in;margin-left:.2pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Maturity</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Notional</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0"><b>Mark-to-market Gain (Loss)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0">Notional</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=center style='margin-left:6.4pt;text-align:center' style="margin-top:0;margin-bottom:0">Mark-to-market Gain (Loss)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-right:2.9pt;text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b><i>PLDT</i></b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Long-term
 currency swaps</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-top:0in;margin-right:20.9pt;
 margin-bottom:0in;margin-left:5.05pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">2017</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$300</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(Php2,716)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">US$300</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php417</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.1pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.1pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=right style='margin-top:0in;margin-right:20.9pt;
 margin-bottom:0in;margin-left:5.05pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">2012</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>250</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(2,475) </b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">250</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:8.1pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(428)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Long-term foreign currency bought call options</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:20.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>167</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(747)</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">175</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">301</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:22.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">Long-term foreign currency sold call options</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:20.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2009</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>167</b>(1)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>138</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">175(1)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(270)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Short-term
 currency sold call options</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:20.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>7</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(6) </b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">JPY151</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Interest
 rate swap</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:20.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2012</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>63</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(423) </b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">US$125</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,569)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Forward
 foreign exchange contracts</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:20.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>202</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(90) </b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">220</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(169)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">JPY1,282</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Bifurcated
 equity call options</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:20.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2008</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1 share</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(224) </b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">8 shares</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,597)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(Php6,543)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(Php3,310)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' border:none;
 background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b><i>Smart</i></b></p>
 </td>
 <td   valign=bottom style=' border:none;background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Bifurcated
 embedded derivatives</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:20.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2007</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$15</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>44</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0">US$9</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">26</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' border:none;
 border-bottom:double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Net
 liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:11.5pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(Php6,499</b><b>)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(Php3,284)</p>
 </td>
 </tr>
</table></center></div>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>(1)</i><i>   Sold
call options of 2009 long-term foreign currency options based on the same
notional amount as the long-term foreign currency bought call option.</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:99.96%;margin-left:.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;border-top:solid windowtext 1.0pt;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=2 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=right style='margin-top:0in;margin-right:7.7pt;
 margin-bottom:0in;margin-left:4.65pt;margin-bottom:.0001pt;text-align:right' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Presented
 as:</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Current
 assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>47</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Noncurrent
 assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0"><b>434</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:.05in;text-align:right' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Current
 liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(108)</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(192)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Noncurrent
 liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(6,872)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(5,777)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Net
 liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(6,499)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(3,284)</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">Analysis of loss on derivative
transactions for the years ended December 31, 2006, 2005 and 2004 are as
follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.0%;margin-left:.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.0pt'>
 <td   valign=top style=' border:none;padding:0in 0in 0in 0in;
 height:8.0pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=top style=' border:none;
 padding:0in 0in 0in 0in;height:8.0pt'>
 <p align=center style='margin-left:40.5pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Net
 mark-to-market loss at end of year</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(6,499)</b></p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(3,284)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,953)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p style='margin:0in;margin-bottom:.0001pt;line-height:normal' style="margin-top:0;margin-bottom:0">Net
 mark-to-market loss at beginning of year</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(3,284)</b></p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,953)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(2,205) </p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Net
 change</p>
 </td>
 <td   valign=top style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(3,215)</b></p>
 </td>
 <td   valign=top style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(331)</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(748)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p style="margin-top:0;margin-bottom:0">Settlements, accretion and
 conversion</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(3,642)</b></p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,470)</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in 0in 0in 0in 0in !msorm'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(116)</p>
 </td>
 </tr>
 <tr style='height:3.5pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:3.5pt'>
 <p style='text-align:justify' style="margin-top:0;margin-bottom:0">Net
 loss on derivative transactions</p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><b>(6,857)</b></p>
 </td>
 <td   valign=top style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(1,801)</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:double windowtext 1.5pt;border-right:none;
 background:#E0E0E0;padding:0in 0in 0in 0in;height:3.5pt'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(864)</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><b><i>PLDT</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Long-term
Currency Swaps</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT entered into long-term principal only currency
swap agreements with various foreign counterparties to hedge the currency risk
on its fixed rate notes maturing in 2009, 2012 and 2017.  As at December 31,
2006 and 2005, these long-term currency swaps have an aggregate notional amount
of US$550 million.  Under the swaps, PLDT effectively exchanges the principal
of its U.S. dollar-denominated fixed rate notes into Philippine
peso-denominated loan exposures at agreed swap exchange rates.  The agreed swap
exchange rates are reset to the lowest U.S. dollar/Philippine peso spot
exchange rate during the term of the swaps, subject to a minimum exchange
rate.  In March and April 2004, PLDT entered into amendments to keep the lowest
reset exchange rate and unwind the downward resettable feature of its long-term
principal only currency swap agreements in order to lower the running hedging
cost of the swaps.  As at December 31, 2006 and 2005, the outstanding swap
contracts have an agreed average swap exchange rate of Php50.76.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">In
order to manage hedge costs, these swaps included a credit-linkage feature with
PLDT as the reference entity.  The specified credit events include bankruptcy,
failure to pay, obligation acceleration, moratorium/repudiation, and
restructuring of PLDT bonds or all or substantially all of PLDT&#146;s obligations.
Upon the occurrence of any of these credit events, subject to agreed threshold
amounts where applicable, the obligations to both PLDT and its counterparty
under the swap contracts terminate without further settlements to either party,
including any mark-to-market value of the swaps.  As at December 31, 2006 and
2005, US$717 million and US$725 million, respectively, of PLDT&#146;s long-term currency
swaps/options have been structured to include credit-linkage with PLDT as the
reference entity.  The semi-annual fixed or floating swap cost payments that
PLDT is required to make to its counterparties averaged about 5.18% and 4.50%
per annum as at December 31, 2006 and 2005, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Long-term
Foreign Currency Bought Call Options</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">To
manage hedging costs, the currency swap agreement relating to the 2009 fixed
rate notes has been structured to include currency option contracts.  If the
Philippine peso to U.S. dollar spot exchange rate on maturity date settles
beyond Php90.00 to US$1.00, PLDT will have to purchase U.S. dollar at an
exchange rate of Php52.50 to US$1.00 plus the excess of the spot exchange rate
on maturity date against the agreed threshold rate.  On the other hand, if on
maturity, the Philippine peso to US$1.00 spot exchange rate is lower than the
exchange rate of Php52.50 to US$1.00, PLDT will have the option to purchase at
the prevailing Philippine peso to U.S. dollar spot exchange rate.  In July
2004, PLDT and its counterparty agreed to re-document and re-classify the
transaction into long-term currency option contracts.  The net semi-annual
floating hedge cost payments that PLDT is required to pay under these
transactions was approximately 6.17% and 5.68% per annum as at December 31,
2006 and 2005, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
option currency contract relating to PLDT&#146;s option to purchase U.S. dollar at
Php52.50 to US$1.00 or the prevailing spot rate at maturity, whichever is
lower, is entered into in tandem with an option currency contract relating to
the counterparty&#146;s option to purchase foreign currency from PLDT at Php90.00 to
US$1.00.  See discussion below under &#150; <i>Long-term Foreign Currency Sold Call
Options</i>.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">In
December 2006, the currency swap agreements were partially terminated, which
effectively lowered the outstanding currency options notional amount to US$167
million.  Total amounts settled for the unwinding is Php40 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Long-term
Foreign Currency Sold Call Options</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">With reference to the
above-mentioned hedge on the PLDT&#146;s 2009 fixed rate notes, PLDT simultaneously
sold a currency option contract with the same notional amount of US$175 million
with the same maturity that gives the counterparty a right to purchase foreign
currency at Php90.00 to US$1.00.  Together with the bought call long-term
currency option contract, PLDT has the obligation to purchase U.S. dollars at
an exchange rate of Php52.50 to US$1.00 plus the excess of the spot exchange
rate on maturity date against the agreed threshold rate.  In exchange for this
condition, the overall net hedging cost for the transaction is reduced.  In
December 2006, the currency swap agreements were partially terminated, which
lowered the notional amount to US$167 million.  Since charges in fair value
have already been recognized as profit and loss in prior periods, the
corresponding proceeds from the partial termination of the currency option
contract amounted to Php7 million.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Short-term
Foreign Currency Sold Call Options</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT
entered into short-term U.S. dollar subsidized forward contracts to partially
hedge PLDT&#146;s fixed rate notes due June 2006.  In order to reduce overall net
hedging cost for the transactions, these forward contracts have been structured
to include the sale of currency call option contracts that give the
counterparty the right to purchase foreign currency at an agreed exchange
rate.  PLDT effectively has the obligation to buy U.S. dollars at a subsidized
forward rate plus any excess above the agreed threshold rate should the
Philippine peso to U.S. dollars spot exchange rate on the maturity date settle
beyond that agreed threshold.  PLDT&#146;s subsidized forward contracts amounting to
US$62 million matured on June 29, 2006.  As at December 31, 2006, there were no
outstanding subsidized forward contracts.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">PLDT also entered into short-term
U.S. dollar subsidized and accumulating forwards and Japanese yen currency
option contracts to hedge other short-term foreign currency obligations.  As at
December 31, 2006, the outstanding U.S. dollar currency option contracts
amounted to US$8 million with an average exchange rate of US$50.40.  PLDT&#146;s Japanese yen currency option
contracts amounting to JPY5,410 million matured on September 21, 2006.  As at
December 31, 2006, there are no outstanding Japanese yen currency option
contracts.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Interest
Rate Swap</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">A portion of PLDT&#146;s currency swap agreements to hedge
its 2017 fixed rate notes carry fixed rate swap cost payments.  To effectively
lower the running cost of such swap agreements, PLDT, in April 2003, entered
into an agreement to swap the coupon on US$125 million of its 2012 fixed rate
notes into a floating rate Japanese yen amount.  Under this agreement, PLDT is
entitled to receive a fixed coupon rate of 11.375%, provided the Japanese yen
to U.S. dollar exchange rate stays above JP&yen;99.90 to US$1.00.  Below this
level, a reduced fixed coupon rate of 3% will be due to PLDT.  In order to
mitigate the risk of the Japanese yen strengthening below the agreed threshold,
PLDT, in December 2003, entered into an overlay swap transaction to effectively
lower the portion of the coupon indexed to the U.S. dollar to Japanese yen rate
to 3% such that the fixed coupon rate due to PLDT when the Japanese yen
strengthens below the agreed threshold will be 8.375%.  Both swap agreements
include a credit-linkage feature with PLDT as the reference entity.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">In March 2006, the interest rate and overlay swap
agreements were partially terminated to effectively lower the outstanding
interest rate swap notional amount to US$62.5 million.  Since changes in fair
values have already been recognized as profit and loss in prior periods, the
corresponding liability settled by PLDT amounted to Php804 million. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Forward Foreign Exchange Contracts</i></p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT entered into short-term U.S. dollar and Japanese
yen forward foreign exchange contracts to hedge short-term foreign currency
obligations.  As at December 31, 2006, outstanding forward foreign exchange
contracts amounted to US$202 million with an average exchange rate of Php49.50.
There were no outstanding JPY forward foreign exchange contracts as at
December 31, 2006.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><i>Bifurcated Embedded Derivatives</i></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Derivative instruments include derivatives (or
derivative-like provisions) embedded in non-derivative contracts.  PLDT&#146;s outstanding
bifurcated embedded derivative transactions as at December 31, 2004 covered
service contracts denominated in U.S. dollars paid out to a Japanese company in
April 2005.  There are no outstanding bifurcated embedded derivative
transactions as at September 30, 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>Bifurcated
Equity Call Options</i></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Pursuant
to Piltel&#146;s debt restructuring plan, PLDT issued its Series VI and VII
Convertible Preferred Stock, see <i>Note 12 &#150; Interest-bearing Financial
Liabilities</i>.  Each share of Series VI and VII Convertible Preferred Stock
is convertible at any time at the option of the holder into one share of PLDT&#146;s
common stock.  On the date immediately following the seventh anniversary of the
issue date of the Series VI Convertible Preferred Stock and on the eighth anniversary
of the issue date of the Series VII Convertible Preferred Stock, the remaining
outstanding shares under these series will be mandatorily converted into shares
of PLDT common stock.  For 30 days thereafter, the holders of these mandatorily
converted shares of common stock have the option to sell such shares of common
stock back to PLDT for US$36.132 per share and JPY4,071.89 per share for
Series VI and VII, respectively.  On August 18, 2006, all 3,842,000 shares of
Series VII shares were converted to PLDT common stock.  As at December 31, 2006
and 2005, the negative fair market value of these embedded call options
amounted to Php224 million and Php1,597 million, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Smart</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Smart&#146;s other embedded derivatives were bifurcated
from service and purchase contracts.  As at December 31, 2006 and 2005,
outstanding contracts included service contract with foreign equipment
suppliers and various suppliers covering handset importations denominated in
U.S. dollars, which is not the functional currency of a substantial party to
the contract or the routine currency of the transaction.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b>Financial Risk Management
Objectives and Policies</b></p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">The main purpose of our financial
instruments is to fund our operations.  We also enter into derivative
transactions, the purpose of which is to manage the currency risks and interest
rate risks arising from our operations and our sources of financing.  It is,
and has been throughout the year under review, our policy that no trading in
financial instruments shall be undertaken.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0">The main risks arising from our
financial instruments are liquidity risk, foreign exchange risk, interest rate
risk and credit risk.  Our board of directors reviews and approves policies for
managing each of these risks. Our policies for managing these risks are
summarized below.  We also monitor the market price risk arising from all
financial instruments.  Our accounting policies in relation to derivatives are
set out in <i>Note 3 &#150; Summary of Significant Accounting Policies and Practices</i>.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Liquidity Risk</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">We seek to manage our liquidity profile
to be able to finance our capital expenditures and service our maturing debts.
To cover our financing requirements, we currently intend to use internally
generated funds and proceeds from debt and equity issues and sales of certain
assets. </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">As part of our liquidity risk management
program, we regularly evaluate our projected and actual cash flow information
and continuously assess conditions in the financial markets for opportunities
to pursue fund-raising initiatives.  These initiatives may include bank loans,
export credit agency-guaranteed facilities, and debt capital and equity market
issues.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Foreign Exchange Risk</i></b></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">The
following table shows our consolidated foreign currency-denominated monetary
assets and liabilities and their peso equivalents as at December 31, 2006 and
2005:</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.88%;margin-left:.4pt;border-collapse:collapse'>

 <tr style='page-break-inside:avoid;height:8.85pt'>
 <td   valign=bottom style=' border:none;border-top:
 solid windowtext 1.5pt;padding:0in 0in 0in 0in;height:8.85pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p style='page-break-after:auto' style="margin-top:0;margin-bottom:0">2006</p>
 </td>
 <td   colspan=2 valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;height:8.85pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:15.35pt' style='page-break-inside:
 avoid !msorm;height:15.35pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:15.35pt'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:15.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>U.S. Dollar</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in;border-top:solid windowtext 1.0pt !msorm;border-left:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;border-right:none !msorm;
 padding:0in 0in 0in 0in !msorm;height:15.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Php Equivalent</b><b>(1)</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:15.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">U.S. Dollar</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;border:none !msorm;
 border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:15.35pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">Php Equivalent(2)</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:11.5pt'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in;
 height:11.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=4 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in;height:11.5pt'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0">(in millions)</p>
 </td>
 </tr>

 <tr style='height:12.15pt' style='height:12.15pt !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.15pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:12.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:7.65pt' style='height:7.65pt !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:7.65pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Cash
 and cash equivalents</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$154</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php7,577</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$244</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:7.65pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php12,957</p>
 </td>
 </tr>
 <tr style='height:.15in' style='height:.15in !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.15in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Short-term
 investments</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>92</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>4,521</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">55</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,934</p>
 </td>
 </tr>
 <tr style='height:13.05pt' style='height:13.05pt !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.05pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Trade
 and other receivables</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>252</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>12,348</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">139</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7,371</p>
 </td>
 </tr>
 <tr style='height:13.05pt' style='height:13.05pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.05pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>47</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.05pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 </tr>
 <tr style='height:8.0pt' style='height:8.0pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:8.0pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 current financial assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:8.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 499</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:8.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>24,493</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:8.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 439</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:8.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">23,299</p>
 </td>
 </tr>
 <tr style='height:13.45pt' style='height:13.45pt !msorm'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Financial
 Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:9.0pt' style='height:9.0pt !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.0pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0">Derivative
 assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>9</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>434</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">50</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,648</p>
 </td>
 </tr>
 <tr style='height:.15in'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.15in'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0">Notes
 receivable</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">346</p>
 </td>
 </tr>
 <tr style='height:11.15pt'>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:11.15pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 noncurrent financial assets</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:11.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>   9</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:11.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 434</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:11.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">  56</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.0pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 background:#F3F3F3;padding:0in 0in 0in 0in;height:11.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,994</p>
 </td>
 </tr>
 <tr style='height:13.45pt' style='height:13.45pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0"><b>Total
 Financial Assets</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$</b><b>508</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php24,927</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$495</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php26,293</p>
 </td>
 </tr>
 <tr style='height:6.15pt' style='height:6.15pt !msorm'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:6.15pt'>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 <p style='margin-left:8.6pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:6.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:6.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:6.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;
 height:6.15pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:13.45pt' style='height:13.45pt !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.45pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Current Financial
 Liabilities</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:8.1pt' style='height:8.1pt !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:8.1pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accounts
 payable</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$122</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php5,968</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$42</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:8.1pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php2,227</p>
 </td>
 </tr>
 <tr style='height:9.45pt' style='height:9.45pt !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Accrued
 expenses and other current liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>208</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>10,194</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">68</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,587</p>
 </td>
 </tr>
 <tr style='height:.1in' style='height:.1in !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.1in'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 liabilities</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>2</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>108</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:.1in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">192</p>
 </td>
 </tr>
 <tr style='height:9.0pt' style='height:9.0pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p style='margin-left:17.6pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0">Current portion of interest-bearing financial
 liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>327</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>16,027</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">337</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">17,867</p>
 </td>
 </tr>
 <tr style='height:9.35pt' style='height:9.35pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.35pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 current financial liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b> 659</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>32,297</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 450</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:9.35pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">23,873</p>
 </td>
 </tr>
 <tr style='height:13.45pt' style='height:13.45pt !msorm'>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p style="margin-top:0;margin-bottom:0"><b>Noncurrent Financial
 Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in;border:none !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='height:17.55pt' style='height:17.55pt !msorm'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:17.55pt'>
 <p style='margin-left:17.6pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Interest-bearing financial liabilities - net of
 current portion</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:17.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,356</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:17.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>66,510</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:17.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,738</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:17.55pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">92,218</p>
 </td>
 </tr>
 <tr style='height:11.7pt' style='height:11.7pt !msorm'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:11.7pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Derivative
 liabilities</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>140</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>6,872</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">109</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in 0in 0in 0in 0in !msorm;height:11.7pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,777</p>
 </td>
 </tr>
 <tr style='height:9.45pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0">Preferred
 stock subject to mandatory redemption</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>27</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;padding:0in 0in 0in 0in;height:9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,308</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">221</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in;height:
 9.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">11,702</p>
 </td>
 </tr>
 <tr style='height:13.45pt' style='height:13.45pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">Total
 noncurrent financial liabilities</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>1,523</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>74,690</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,068</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;border:
 none !msorm;border-bottom:solid windowtext 1.0pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">109,697</p>
 </td>
 </tr>
 <tr style='height:13.45pt' style='height:13.45pt !msorm'>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p style='margin-left:9.0pt' style="margin-top:0;margin-bottom:0"><b>Total
 Financial Liabilities</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>US$</b><b>2,182</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>Php106,987</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">US$2,518</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in;
 border:none !msorm;border-bottom:double windowtext 1.5pt !msorm;padding:0in 0in 0in 0in !msorm;
 height:13.45pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">Php133,570 </p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>

<p style="margin-top:0;margin-bottom:0"><i>(1)</i><i> The exchange rate used was Php</i><i>49.045</i><i> to
US$1.00.</i></p>

<p style="margin-top:0;margin-bottom:0"><i>(2)  </i><i>The exchange rate used was Php53.062 to</i><i> US$1.00.</i></p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">In translating the foreign currency-denominated
monetary assets and liabilities into peso amounts, the exchange rates used were
Php49.045 to US$1.00 and Php53.062 to US$1.00, the Philippine peso-U.S. dollar
exchange rates as at December 31, 2006 and 2005, respectively.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">As at June 26, 2007, the peso-dollar
exchange rate was Php46.222 to US$1.00.  Using this exchange rate, our
consolidated net foreign currency-denominated liabilities as at December 31,
2006 would have decreased by Php4,726 million.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">While a certain percentage of our
revenues is either linked to or denominated in U.S. dollars, substantially all
of our indebtedness and related interest expense, a substantial portion of our
capital expenditures and a portion of our operating expenses are denominated in
foreign currencies, mostly in U.S. dollars.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0"><a
name="OLE_LINK60"></a><a name="OLE_LINK59">As at
December 31, 2006, approximately 96% of our total consolidated debts were
denominated in foreign currencies, principally in U.S. dollars.  Thus, a
strengthening or weakening of the Philippine peso against the U.S. dollar will
decrease or increase, respectively, both the principal amount of our unhedged
foreign currency-denominated debts (representing 43% of our consolidated debts,
or 31% net of our U.S. dollar cash balances as at December 31, 2006), and
interest expense on our debt in Philippine peso terms.  In addition, many of
our financial ratios and other financial tests are affected by the movements in
the Philippine peso to U.S. dollar exchange rate.</a>  For further
information on our loan covenants, see <i>Note 12 &#150; Interest-bearing Financial
Liabilities</i>.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">To manage our foreign exchange risks,
stabilize cash flows, and improve investment and cash flow planning, we enter
into forward foreign exchange contracts, foreign currency swap contracts,
currency option contracts and other hedging products aimed at reducing and/or
managing the adverse impact of changes in foreign exchange rates on our
operating results and cash flows.  However, these hedges do not cover all of our
exposure to foreign exchange risks.</p>

<p style='margin-left:0in;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Specifically,
we use forward foreign exchange contracts, foreign currency swap contracts and
currency option contracts to manage the foreign currency risk associated with
our foreign currency-denominated loans.  In order to manage hedge costs of
these contracts, we utilize structures that include credit-linkage with PLDT as
the reference entity, a combination of currency option contracts, and fixed to
floating coupon only swap agreements.  Accounted for as either cash flow hedges
or transactions not designated as hedges, changes in the fair value of these
financial instruments are recognized as accumulated other comprehensive income
(loss) in equity until the hedged item is recognized directly as income or
expense for the period.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">As
at December 31, 2006, PLDT&#146;s outstanding forward foreign exchange contracts,
principal-only long-term cross-currency swap contracts, and currency option
contracts amounted to US$202 million, US$550 million, and US$174 million,
respectively.  Smart had no outstanding forward foreign exchange contracts as
at December 31, 2006.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b><i>Interest Rate Risk</i></b></p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">On a limited basis, we enter into
interest rate swap agreements in order to manage our exposure to interest rate
fluctuations.  We make use of hedging instruments and structures solely for
reducing or managing financial risks associated with our liabilities and not
for trading or speculative purposes.</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Fixed rate financial instruments are
subject to fair value interest rate risk while floating rate financial
instruments are subject to cash flow interest rate risk.  </p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:0in;text-indent:.5in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">Repricing of floating rate financial
instruments is mostly done on intervals of three months or six months.
Interest on fixed rate financial instruments is fixed until maturity of the
particular instrument.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0"><b><i>Credit Risk</i></b></p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">We trade only with
recognized and creditworthy third parties.  It is our policy that all customers
who wish to trade on credit terms are subject to credit verification
procedures.  In addition, receivable balances are monitored on an ongoing basis
to reduce our exposure to bad debts.</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">With respect to credit risk arising from our
financial assets, which comprise cash and cash equivalents, trade and other
receivables, notes receivable and certain derivative financial instruments, our
exposure to credit risk arises from default of the counterparty, with a maximum
exposure equal to the carrying amount of these financial instruments.</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left;text-indent:.5in' style="margin-top:0;margin-bottom:0">We have no significant concentrations of credit
risk.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin-top:0in;page-break-after:avoid;punctuation-wrap:
hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">24.    Reportable Segments </p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Operating segments are components of PLDT that engage
in business activities from which they may earn revenues and incur expenses
(including revenues and expenses relating to transactions with other components
of PLDT), whose operating results are regularly reviewed by the enterprise&#146;s
chief operating decision-maker to make decisions about how resources are to be
allocated to the segment and assess their performances, and for which discrete
financial information is available.  The accounting policies of the reportable
segments are the same as those described in <i>Note 3 &#150; Summary of Significant Accounting Policies and Practices</i>.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">We have organized our business into three main
segments:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Wireless &#151; wireless telecommunications services provided through (a) our cellular
service providers namely, Smart and Piltel, Smart Broadband, our wireless
broadband provider, and Wolfpac, our wireless content operator and (b) our satellite
and VSAT operators, namely PLDT&#146;s subsidiaries Mabuhay Satellite, ACeS
Philippines and Telesat;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Fixed Line &#151; fixed line telecommunications services are primarily provided through
PLDT.  We also provide fixed line services through PLDT&#146;s subsidiaries
ClarkTel, SubicTel, Maratel, Piltel, BCC and PLDT Global, which together
account for approximately 3% of our consolidated fixed line service revenues;
and</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:.75in;text-indent:-.25in;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">&bull;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Information and Communications
Technology &#151; information and communications infrastructure and
services for internet applications, internet protocol-based solutions and
multimedia content delivery provided by PLDT&#146;s subsidiary ePLDT; call center
services provided under one umbrella brand name <i>ePLDT Ventus</i>, including
Parlance and Vocativ; BPO services provided by SPi (consolidated since July 11,
2006) and its subsidiaries; internet access and gaming services provided by
ePLDT&#146;s subsidiaries Infocom, Digital Paradise, Digital Paradise Thailand,
netGames, Airborne Access and Level Up!; and e-commerce and IT-related services
provided by other investees of ePLDT, as described in <i>Note 8 &#150; Investments</i>.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">Transfer prices between business segments are set on an
arm&#146;s-length basis in a manner similar to transactions with third parties.
Segment revenue, segment expense and segment result include transfers between
business segments.  These transfers are eliminated in consolidation.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">The
results of the reportable segments are derived directly from the PLDT Group&#146;s
management reporting
system. The results are based on the PLDT Group&#146;s method of internal
reporting.  The segment assets and
results of operations of our reportable segments as at and for the years ended
December 31, 2006, 2005 and 2004 reported under U.S. GAAP are as follows:</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:100.78%;margin-left:.4pt;border-collapse:collapse'>

 <tr>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Wireless</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Fixed Line</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Information and Communications Technology</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Inter-segment Transactions</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='text-align:center' style="margin-top:0;margin-bottom:0"><b>Total</b></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:2.7in;text-align:center' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=5 valign=bottom style=' border:none;
 padding:0in 0in 0in 0in'>
 <p align=center style='margin-left:.05pt;text-align:center' style="margin-top:0;margin-bottom:0">(in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid'>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><i>As at and for the year
 ended December 31, 2006</i></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Revenues</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">78,383</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">49,203</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,337</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(8,919)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">125,004</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,022</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">79</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">553</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(122)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,532</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Segment revenues</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">80,405</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">49,282</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,890</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(9,041)</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">127,536</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Result</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Operating income (loss)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">38,134</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,196</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(252)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">101</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">48,179</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Income (loss) before income (loss) tax,
 cumulative effect of change in accounting policy and minority interest in net
 loss (income) of consolidated subsidiaries</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">42,782</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,366</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(320)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">43,828</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Benefit from (provision for) income tax</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(8,729)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(351)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">34</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(9,046)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Net income (loss) for the year before
 cumulative effect of changes in accounting policy and minority interest in
 net loss of consolidated subsidiaries</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">34,053</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,015</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(286)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">34,782</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Assets</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Segment assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">87,873</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">193,012</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">17,148</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(59,586)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">238,447</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Deferred income tax assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">7,349</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,340</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">59</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">25,748</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Total assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">95,222</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">211,352</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">17,207</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(59,586)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">264,195</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Investments &#150; at equity</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">636</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 636</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Goodwill</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,446</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">426</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8,141</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">25,013</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">Other segment information </p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Capital expenditures</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,491</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8,723</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,134</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">20,348</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9,743</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">17,676</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">711</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">28,130</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">627</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">45</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">64</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 736</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision for inventory obsolescence</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">202</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 211</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Asset impairment</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,391</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">408</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,799</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">MRP</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">29</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">413</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 445</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.1pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0">Interest on loans and related items &#150; net
 of capitalized interest</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">468</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,953</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">21</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,442</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Interest income</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">965</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">441</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,422</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:4.8pt'>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:4.8pt'>
 <p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in;height:4.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in;height:4.8pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:4.8pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:4.8pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in;height:4.8pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.0pt'>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0"><i>As at and </i><i>for
 the year ended December 31, 2005</i></p>
 </td>
 <td   colspan=3 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Revenues</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">74,195</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">49,431</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,953</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(6,231)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">120,348</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,711</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">41</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">352</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(117)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,987</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Segment revenues</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">76,906</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">49,472</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,305</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(6,348)</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">123,335</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Result</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Operating income</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37,470</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,483</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">52</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">509</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">48,514</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Income before income tax, cumulative
 effect of change in accounting policy and minority interest in net income of
 consolidated subsidiaries</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,508</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5,205</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">57</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">45,770</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision
 for income tax</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(4,285)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(544)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(20)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(4,849)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Net income for the year before cumulative
 effect of changes in accounting policy and minority interest in net loss of
 consolidated subsidiaries </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">36,223</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,661</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">37</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">40,921</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Assets</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Segment assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">93,589</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">191,193</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,355</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(42,883)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">246,254</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Deferred income tax assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,735</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,715</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">5</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">23,455</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Total assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">100,324</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">207,908</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,360</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(42,883)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">269,709</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Investments &#150; at equity</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">  15</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Goodwill</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,472</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">426</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">184</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,082</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Other segment
 information </b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Capital expenditures</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8,827</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,432</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">605</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,864</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9,200</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18,240</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">415</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">27,855</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">253</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,944</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">54</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,251</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision for inventory obsolescence</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">322</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">157</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 479</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Asset impairment</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">11</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">  11</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">MRP</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">131</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">327</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 458</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.1pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0">Interest on loans and related items &#150; net
 of capitalized interest</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">952</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8,639</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">24</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9,615</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Interest income</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,057</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">385</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,457</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.0pt'>
 <td   colspan=2 valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p style='margin-right:2.9pt' style="margin-top:0;margin-bottom:0"><i>As at and </i><i>for
 the year ended December 31, 2004</i></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.0pt'>
 <p align=right style='margin-left:13.5pt;text-align:right;
 text-indent:-13.5pt' style="margin-top:0;margin-bottom:0"><i>&nbsp;</i></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Revenues</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Service</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">68,653</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">48,546</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,080</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(4,375)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">114,904</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Non-service</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,111</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">321</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(163)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">6,269</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Segment revenues</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">74,764</p>
 </td>
 <td   valign=bottom style=' border:none;background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">48,546</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,401</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(4,538)</p>
 </td>
 <td   valign=bottom style=' border:none;background:
 #E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">121,173</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:double windowtext 1.5pt;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;border-top:
 double windowtext 1.5pt;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Result</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Operating income (loss)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">33,166</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,519</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(634)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(512)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">48,539</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Income (loss) before income tax,
 cumulative effect of change in accounting policy and minority interest in net
 income of consolidated subsidiaries</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">33,463</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">2,020</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(643)</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">34,840</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision
 for income tax</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(5,967)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(800)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(59)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(6,826)</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt;text-indent:-9.0pt' style="margin-top:0;margin-bottom:0">Net income (loss) for the year before
 cumulative effect of changes in accounting policy and minority interest in
 net income of consolidated subsidiaries </p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">27,496</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,220</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(702)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">28,014</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Assets</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Segment assets</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">89,869</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">196,300</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,716</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(30,871)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">259,014</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Deferred
 income tax assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,164</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,846</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">17</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">20,027</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p style='margin-left:22.5pt' style="margin-top:0;margin-bottom:0">Total
 assets</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">93,033</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">213,146</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,733</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(30,871)</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#F3F3F3;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">279,041</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border:none;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Investments &#150; at equity</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">8</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">   8</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Goodwill</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">15,787</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">426</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">187</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">16,400</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style="margin-top:0;margin-bottom:0"><b>Other segment
 information </b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Capital expenditures</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">14,742</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">4,026</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">500</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">19,268</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Depreciation and amortization</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,082</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">9,677</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">339</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">20,098</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision for doubtful accounts</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">204</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,751</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3,955</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Provision for inventory obsolescence</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">213</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">361</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">3</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 577</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Asset impairment</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">430</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">365</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">617</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#F3F3F3;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">1,412</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">MRP</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">13</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">553</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=top style=' background:#E0E0E0;padding:
 0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 566</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p style='margin-left:22.1pt;text-indent:-8.6pt' style="margin-top:0;margin-bottom:0">Interest on loans and related items &#150; net
 of capitalized interest</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">984</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">10,137</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">42</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(48)</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">11,115</p>
 </td>
 </tr>
 <tr>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p style='margin-left:13.5pt' style="margin-top:0;margin-bottom:0">Interest income</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">724</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">248</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0">18</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='text-align:right' style="margin-top:0;margin-bottom:0">(48)</p>
 </td>
 <td   valign=top style=' border:none;border-bottom:
 double windowtext 1.5pt;background:#E0E0E0;padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right' style="margin-top:0;margin-bottom:0"> 942</p>
 </td>
 </tr>
</table></center></div>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid;punctuation-wrap:hanging;text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">25.    Other Matters</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">a.     Supplemental Disclosures of Cash Flow Information</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div align='center'><center><table style='font-family:arial,helvetica,sans-serif;font-size:9pt'  border=0 cellspacing=0 cellpadding=0
 style='width:101.2%;border-collapse:collapse'>

 <tr style='page-break-inside:avoid'>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:2.9pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>2006</b></p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2005</p>
 </td>
 <td   valign=bottom style=' border-top:solid windowtext 1.5pt;
 border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
 padding:0in 0in 0in 0in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">2004</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:13.2pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.2pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   colspan=3 valign=bottom style=' padding:0in 0in 0in 0in;
 height:13.2pt'>
 <p align=center style='margin-right:4.3pt;text-align:center;
 text-indent:22.5pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">
 (in million pesos)</p>
 </td>
 </tr>

 <tr style='page-break-inside:avoid;height:12.15pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.15pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Cash paid during the year for:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.15pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.15pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:12.15pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p style='text-indent:9.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Income tax </p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>8,267</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">9,722</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">5,478</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:10.35pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p style='margin-left:9.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest:  </p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:10.35pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:12.6pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p style='margin-left:9.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">    Capitalized to property, plant and equipment</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>549</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">504</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:12.6pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">595</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p style='text-indent:18.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Charged to operations</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:4.25pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>7,528</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">10,545</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">12,310</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:.15in'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.15in'>
 <p style='text-indent:9.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Interest income received</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>1,481</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">1,408</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:.15in'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">954</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:8.55pt'>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' padding:0in 0in 0in 0in;
 height:8.55pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.75pt'>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">Supplemental schedule of noncash investing and financing activities:</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&nbsp;</b></p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 <td   valign=bottom style=' background:#E0E0E0;
 padding:0in 0in 0in 0in;height:6.75pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:9.0pt'>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p style='text-indent:9.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Preferred stock subject to mandatory redemption
 issued</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' background:#F3F3F3;
 padding:0in 0in 0in 0in;height:9.0pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">125</p>
 </td>
 </tr>
 <tr style='page-break-inside:avoid;height:6.3pt'>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 6.3pt'>
 <p style='text-indent:9.4pt;page-break-after:avoid' style="margin-top:0;margin-bottom:0">Long-term debt restructured</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 6.3pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0"><b>&#150;</b></p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 6.3pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">&#150;</p>
 </td>
 <td   valign=bottom style=' border:none;border-bottom:
 solid windowtext 1.0pt;background:#E0E0E0;padding:0in 0in 0in 0in;height:
 6.3pt'>
 <p align=right style='margin-right:4.3pt;text-align:right;
 page-break-after:avoid' style="margin-top:0;margin-bottom:0">170</p>
 </td>
 </tr>
</table></center></div>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">b.   Interconnection
Agreements</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt' style="margin-top:0;margin-bottom:0">PLDT
has existing interconnection agreements with nine International Gateway
Facilities, or IGF operators, six Inter Exchange Carriers, or IXCs, six
Cellular Mobile Telephone Systems, or CMTS operators, 70 LECs (including
members of the Philippine Association of Private Telephone Companies, Inc.),
and 12 paging and trunk radio operators.  These interconnection agreements
include provisions for settlement and payment of charges.  Settlements with
interconnecting IGF operators and CMTS operators for local calls are in the
form of access charges.  Settlement with interconnecting IXCs and LECs for toll
calls are based on hauling and access charges, and to some extent, revenue
sharing.  Settlement also involves payment of access charges, but settlement
for toll calls is on a revenue-sharing basis.  LEC to LEC interconnection with
hauling from one service area to another service area is settled based on trunk
charges, while overlay LEC to LEC interconnection in a given service area is
without charges.  Paging and trunk radio interconnection settlements are based
on fixed charges.  </p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0">c.   Proposed
Metering of Local Exchange Service</p>

<p style='margin-left:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-bottom:0in;margin-bottom:.0001pt;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">The proposed metering of PLDT&#146;s local exchange service
has been temporarily suspended for further review by the NTC.</p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin:0in;margin-bottom:.0001pt;line-height:normal;
page-break-after:avoid' style="margin-top:0;margin-bottom:0">d.   Employees and Labor Relations</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">As at December 31, 2006, we had 28,219 employees
within the PLDT Group.  PLDT had 8,526 employees at the end of 2006, of which 44%
were rank-and-file employees, 51% were management/supervisory staff and 5% were
executives.  This number represents a decrease of 493 employees, or
approximately 6%, from the staff level as at the end of 2005, mainly as a
result of the ongoing MRP.  From a peak of 20,312 at the end of 1994, PLDT&#146;s
number of employees has declined by 11,786, or 58%, by the end of 2006.  As at December
31, 2005, we had 18,926 and 9,013 employees under the PLDT Group and PLDT,
respectively.  The increase in the number of employees as at December 31, 2006
was primarily due to the acquisition of SPi, CyMed and Level Up!.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">PLDT
has three employee unions, the members of which in the aggregate represent 23%
of the employees of the PLDT Group.  We consider our relationship with our
rank-and-file employees&#146; union, our supervisors&#146; union and our sales
supervisors&#146; union to be good.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
November 16, 2006, PLDT and the <i>Manggagawa ng Komunikasyon sa Pilipinas</i>,
or MKP, our rank-and-file employees&#146; union, concluded and signed a new
three-year Collective Bargaining Agreement, or CBA, covering the period from
November 9, 2006 to November 8, 2008.  This CBA provides each member a signing
bonus equivalent to one month&#146;s salary (computed at the salary rate prevailing
prior to November 9, 2007) plus Php15,000; monthly salary increases of
Php2,150, Php2,200 and Php2,550 for the first, second and third year, respectively;
an increase in the yearly Christmas gift certificate from Php7,000 to Php8,000;
an increase in the amount of coverage under the group life insurance plan from
Php500,000 to Php650,000; an additional contribution of Php1 million to the
Education Loan Fund; Php35,000 funeral assistance for the death of a
dependent.  Other highlights of this CBA include increases in the rice subsidy
and professional fee for dependent&#146;s hospitalization.</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
March 8, 2005, PLDT and PLDT Sales Supervisors&#146; Union, or PSSU, concluded and
signed a new three-year CBA covering the period from January 1, 2005 to
December 31, 2007.  Effectivity date has been negotiated to be moved from March
to January.  This CBA provided each member monthly salary increases of 8% of
basic pay or Php2,000, whichever is higher, for the first year; 10% of basic
pay or Php2,700, whichever is higher, for the second year; and another 10% of
basic pay or Php2,400, whichever is higher, for the third year.  Other
highlights of this CBA were improvements of existing benefits and a one-time
signing bonus of Php33,000, including a Php3,000 goodwill bonus, for each
member of PSSU.  Furthermore, a Php4,000 one-time clothing accessory allowance was
also provided.  </p>

<p style='margin-left:.5in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On January 20, 2005, PLDT and <i>Gabay ng Unyon sa Telekomunikasyon
ng mga Superbisor</i>, or GUTS, our supervisors&#146; union, concluded and signed a
new three-year CBA covering the period from January 1, 2005 to December 31,
2007.  This CBA provided each member monthly salary increases of 8% of basic
pay or Php2,000, whichever is higher, for 2005; 10% of basic pay or Php2,700,
whichever is higher, for 2006; and another 10% of basic pay or Php2,400,
whichever is higher, for 2007.  Other highlights of this CBA are improvements
of existing benefits and a one-time signing bonus of Php33,000, including a
Php3,000 goodwill bonus, for each member of GUTS.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:13.5pt;text-indent:-13.5pt' style="margin-top:0;margin-bottom:0">e.   SPi&#146;s Acquisition of Springfield Service
Corporation, or Springfield</p>

<p style='margin-left:.25in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in' style="margin-top:0;margin-bottom:0">On
April 16, 2007, SPi acquired, through a wholly-owned US subsidiary, 100% of Springfield for an aggregate purchase price of US$44 million plus possible future earn out
payments.  Springfield offers practice management services including patient
scheduling, coding and compliance assistance, consulting and specialized
reporting services.</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='margin-left:13.5pt;text-indent:-13.5pt;page-break-after:
avoid' style="margin-top:0;margin-bottom:0">f.    Piltel&#146;s Equity Restructuring</p>

<p style='margin-left:.25in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">On April 20, 2007, the Philippine SEC approved
Piltel&#146;s request to undergo equity restructuring to eliminate the deficit of
Piltel as at December 31, 2006 amounting to Php22,251 million against the
additional paid-in capital.  The equity restructuring was approved by Piltel&#146;s
Board of Directors on March 5, 2007.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='text-indent:.5in;page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<div style='border:none;border-top:solid windowtext 1.0pt;padding:1.0pt 0in 0in 0in'>

<p style='line-height:50%;page-break-after:avoid;border:none;
padding:0in' style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

<p style='page-break-after:avoid;punctuation-wrap:hanging;
text-autospace:ideograph-numeric ideograph-other' style="margin-top:0;margin-bottom:0"><b>26.    Changes in Presentation of Comparative
Consolidated Financial Statements</b></p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style='page-break-after:avoid' style="margin-top:0;margin-bottom:0">We
have reclassified certain accounts in 2005 consolidated financial statements to
conform with our 2006 consolidated financial statements presentation.</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p align=left style='text-align:left' style="margin-top:0;margin-bottom:0">&nbsp;</p>

<p style="margin-top:0;margin-bottom:0">&nbsp;</p>

</div>

</body>

</html>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
