The DIRECTV Group Announces Second Quarter 2006 Results

Business Wire, August 8, 2006

Operational Review. In the second quarter of 2006, DIRECTV Latin America added 77,000 net subscribers principally due to solid subscriber growth in Argentina and Venezuela. The total number of DIRECTV subscribers in Latin America as of June 30, 2006 increased 14% to 1.73 million compared to 1.52 million as of June 30, 2005.

Revenues for DIRECTV Latin America increased 10% to $202 million in the quarter primarily due to the larger subscriber base partially offset by the absence of revenues in 2006 from DIRECTV Latin America's Mexico operations due to its shutdown. The decline in DIRECTV Latin America's second quarter 2006 operating profit before depreciation and amortization to $21 million and the operating loss of $13 million were primarily attributable to a non-cash gain of $28 million in the second quarter of 2005 related to the successful migration and retention of a portion of the DIRECTV Latin America subscribers in Mexico to the Sky Mexico platform.

Network Systems Segment

                                        Three Months      Six Months
                                       Ended June 30,   Ended June 30,
Network Systems Segment                --------------   --------------
Dollars in Millions                     2006    2005     2006    2005
-------------------------------------- ------   -----   ------   -----
Revenue                                    -     $45        -    $211
-------------------------------------- ------   -----   ------   -----
Operating Loss Before Depreciation and
 Amortization(1)                           -      (8)       -     (61)
-------------------------------------- ------   -----   ------   -----
Operating Loss                             -      (8)       -     (61)
-------------------------------------- ------   -----   ------   -----

On April 22, 2005, The DIRECTV Group completed the sale of a 50% interest in HNS LLC, an entity that owns substantially all of the assets of HNS, to SkyTerra Communications, Inc. As of the date of this sale until January 2006, The DIRECTV Group accounted for 50% of HNS' net income or loss as an equity investment in "Other, net" in the Consolidated Statements of Operations. In January 2006, The DIRECTV Group completed the sale of the remaining 50% interest in HNS LLC to SkyTerra and received $110 million in cash.

CONSOLIDATED BALANCE SHEET AND CASH FLOW

The DIRECTV Group                         June 30,       December 31,
                                      ----------------- --------------
Dollars in Billions                         2006            2005
------------------------------------- ----------------- --------------
Cash, Cash Equivalents & Short-Term
 Investments                                     $2.05          $4.38
------------------------------------- ----------------- --------------
Total Debt                                        3.41           3.42
------------------------------------- ----------------- --------------
Net Debt/(Cash)                                   1.36          (0.96)
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