~~CORPORACION~~SECURITIES ~~DURANGO, S.A. DE C.V.~~ AND ~~SUBSIDIARIES~~EXCHANGE CONSOLIDATED CONDENSED BALANCE SHEETS AS OF DECEMBER 31, 2004 AND JUNE 30, 2005 (UNAUDITED) EXPRESSED IN TERMS OF THE PURCHASING POWER OF MEXICAN PESOS AS OF JUNE 30, 2005 (Stated in thousands of Pesos and Dollars) US$ DLLS. December 31, June 30, June 30, 2004 2005 2005 ASSETS CURRENT ASSETS: Cash and cash equivalents ........................$ 840,271$ 471,675 43,774 Accounts receivable, net ......................... 1,682,692 1,791,032 166,218 Taxes recoverable and other assets ............... 106,309 72,281 6,708 Inventories, net ................................. 1,083,096 1,160,751 107,724 Prepaid expenses ................................. 6,675 16,925 1,571 Current assets of discontinued operations ........ 105,318 120,150 11,151 Total current assets ................... 3,824,361 3,632,814 337,146 PROPERTY, PLANT AND EQUIPMENT, net ................. 11,172,170 11,149,453 1,034,733 OTHER ASSETS, net .................................. 334,578 340,325 31,584 Noncurrent assets of discontinued operations ....... 251,265 235,483 21,854 Total assets ..........................$ 15,582,374$ 15,358,075 1,425,317 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Bank loans and current portion of long-term debt . 178,630 196,379 18,225 Interest payable ................................. 15,842 13,880 1,288 Trade accounts payable ........................... 739,225 928,592 86,179 Notes payable .................................... 48,958 56,227 5,218 Accrued liabilities .............................. 692,992 509,161 47,253 Employee profit-sharing .......................... 855 1,549 144 Current liabilities of discontinued operations ... 127,915 68,641 6,370 Total current liabilities ............. 1,804,417 1,774,429 164,677 LONG-TERM DEBT ..................................... 7,004,582 6,655,004 617,622 LONG-TERM NOTES PAYABLE ............................ 88,773 77,379 7,181 DEFERRED TAXES...................................... 1,672,275 1,936,816 179,748 LIABILITY FOR EMPLOYEE BENEFITS..................... 264,951 310,507 28,817 LIABILITY FOR CAPITALIZATION ....................... 3,183,926 0 0 LONG TERM LIABILITIES OF DISCONTINUED OPERATIONS.... 156,205 141,236 13,108 Total long term liabilities ............ 12,370,712 9,120,942 846,475 Total liabilities ..................... 14,175,129 10,895,371 1,011,153 STOCKHOLDERS' EQUITY: Majority interest ................................ 1,331,961 4,427,646 410,911 Minority interest ................................ 75,284 35,058 3,254 Total stockholders' equity ............. 1,407,245 4,462,704 414,164 Total liabilities and stockholders' equi$ 15,582,374$ 15,358,075 1,425,317 Exchange rate: $ 10.7752COMMISSION

~~CORPORACION DURANGO~~Washington, SD.~~A. DE~~ C.V. AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN FINANCIAL POSITION EXPRESSED IN TERMS OF THE PURCHASING POWER OF MEXICAN PESOS AS OF JUNE 30, 2005 (Stated in thousands of Pesos and Dollars) * Full Year Acum. June Acum. June 2004 2005 US$ 2005 OPERATING ACTIVITIES: Net income (loss) ..............................................$ -151,833$ -81,113 -7,528 Add (deduct)- Charges (credits) to income which do not require (generate) resources: Depreciation and amortization ........................... 429,072 212,767 19,746 Amortization of debt issuance cost and other financing costs ..................................... 330,051 0 0 Loss on sale of property, plant and equipment ........... 22,283 124 12 Impairment of long-lived assets ......................... 467,352 0 0 Deferred income taxes ................................... -321,514 238,964 22,177 Other.................................................... 31,970 23,787 2,208 Total items which do not require cash.................... 959,214 475,642 44,142 Net resources generated from income .......................... 807,381 394,529 36,615 Changes in operating assets and liabilities: Decrease (Increase) in inventories ......................... 71,391 -77,655 -7,207 Decrease (Increase) in current assets ...................... 9,341 -46,392 -4,305 Decrease (increase) in account receivables, net ............ 132,250 -38,170 -3,542 (Decrease) increase in accounts payable and accrued liabilities ...................................... -180,653 11,537 1,071 Resources generated by continued operating .................. 839,710 243,849 22,631 Assets and liabilities discontinued .......................... 22,081 -74,106 -6,877 Resources generated by operating activities .................. 861,791 169,743 15,753 FINANCING ACTIVITIES: Increase (Decrease) in bank loans and others ............ -610,093 -3,486,341 -323,552 Increase (Decrease) in capital .......................... 47 282,681 26,234 Gain on shares sales .................................... 0 2,891,425 268,341 Net resources generated from financing activities ............ -610,046 -312,235 -28,977 INVESTMENT ACTIVITIES: Restricted cash.......................................... 166,987 0 0 Acquisition of property, plant and equipment............. -208,917 -50,888 -4,723 Sale of property, plant and equipment.................... 16,078 735 68 Disposition of subsidiaries ............................. 0 -191,498 -17,772 Increase in deferred assets ............................. -70,109 15,547 1,443 Net resources applied to investing activities ................ -95,961 -226,104 -20,984 INCREASE IN CASH AND CASH EQUIVALENTS .......................... 155,784 -368,596 -34,208 CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD............ 684,487 840,271 77,982 CASH & CASH EQUIVALENTS AT END OF THE PERIOD ...................$ 840,271$ 471,675US 43,774 * The exchange rate of 10.7752 was used for translation purposes.20549

CORPORACION DURANGO, S.A. DE C.V. AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF INCOME (UNAUDITED) EXPRESSED IN TERMS OF THE PURCHASING POWER OF MEXICAN PESOS AS OF JUNE 30, 2005 Thousands of Pesos Thousands of Dollars 2Q 2Q 2Q 2Q 2004 2005 Var 2004 2005 Var NET SALES ...............................$ 1,927,219$ 2,101,764 9% 162,992 195,055 20% COST OF SALES ........................... 1,665,743 1,838,892 10% 141,041 170,660 21% Gross profit........................ 261,476 262,872 1% 21,951 24,395 11% Selling and Administrative expenses 158,165 155,670 -2% 13,304 14,447 9% Operating income ................... 103,311 107,202 4% 8,647 9,948 15% FINANCIAL EXPENSE: Interest expense ........................ 386,401 137,605 -64% 32,158 12,771 -60% Interest income ......................... -5,416 -2,511 -54% -450 -233 -48% Exchange (gain) loss, net ............... 364,257 -264,203 N/A 30,292 -24,520 N/A Gain on monetary position ............... 14,188 -10,333 N/A 1,297 -959 N/A Total financial expense ............... 759,430 -139,442 N/A 63,297 -12,941 N/A OTHER INCOME (EXPENSES): Other income (expense), net ............. -23,936 -70,511 195% -1,974 -Form 6~~,544 232% Total other income (expense) ..........~~ -23,936 -70,511 195% -1,974 -6,544 232% Income (loss) before income and asset t -680,055 176,133 -126% -56,624 16,345 -129% Provisions for income and asset taxes ... 8,483 12,137 43% 726 1,126 55% Provision for deferred income taxes ..... 64,137 163,966 156% 5,064 15,217 200% Net income after taxes ................ -752,675 30 -100% -62,414 2 -100% Impairment .............................. -423,473 0 -100% -35,216 0 -100% Discontinued operations ................. 11,021 -30,217 N/A 917 -2,804 N/A Net income before minority interest......$ -340,223$ 30,247 -109% -28,115 2,806 -110% Minority interest...................... -112 -2,505 2137% -11 -233 2018% Majority net income....................$ -340,111$ 32,752 -110% -28,104 3,039 -111% Operating income ...................... 103,311 107,202 4% 8,647 9,948 15% Depreciation & amortization ........... 98,613 103,500 5% 8,306 9,605 16% Interest income ....................... 5,416 2,511 -54% 450 233 -48% Employee retirement obligations ....... 918 14,922 1525% 76 1,385 1722% Allowance for doubtful accounts ....... 4,695 4,053 -14% 390 376 -4% EBITDA ................................ 212,953 232,188 9% 17,869 21,547 21%K

~~CORPORACION~~REPORT ~~DURANGO, S.A. DE C.V. AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS~~ OF ~~INCOME~~FOREIGN ~~(UNAUDITED)~~PRIVATE ~~EXPRESSED~~ISSUER INPURSUANT ~~TERMS~~TO OFRULE THE PURCHASING POWER OF MEXICAN PESOS AS OF JUNE 30, 2005 Thousands of Pesos Thousands of Dollars Ac Ac Ac Ac 2004 2005 Var 2004 2005 Var NET SALES ...............................$ 3,709,037$ 4,127,397 11% 316,815 377,094 19% COST OF SALES ........................... 3,244,568 3,591,008 11% 277,423 328,128 18% Gross profit........................ 464,469 536,389 15% 39,392 48,966 24% Selling and Administrative expenses 299,794 302,937 1% 25,510 27,671 8% Operating income ................... 164,675 233,452 42% 13,882 21,295 53% FINANCIAL EXPENSE: Interest expense ........................ 727,055 285,253 13A-~~61% 61,375 25,987 -58% Interest income ......................... -11,350 -~~16~~,696~~ OR ~~47%~~ 15D-959 -1,503 57% Exchange (gain) loss, net ............... 297,563 -238,737 N/A 24,574 -22,242 N/A Gain on monetary position ............... -128,212 -64,994 -49% -10,874 -5,832 -46% Total financial expense ............... 885,056 -35,174 N/A 74,116 -3,590 N/A OTHER INCOME (EXPENSES): Other income (expense), net ............. -7,604 -130,970 1622% -544 -11,960 2099% Total other income (expense) .......... -7,604 -130,970 1622% -544 -11,960 2099% Income (loss) before income and asset t -727,985 137,656 -119% -60,778 12,925 -121% Provisions for income and asset taxes ... 41,498 21,963 -47% 3,640 2,021 -44% Provision for deferred income taxes ..... -213,859 238,964 -212% -18,715 21,914 -217% Net income after taxes ................ -555,624 -123,271 -78% -45,703 -11,010 -76% Impairment .............................. 534,736 0 -100% 46,932 0 -100% Discontinued operations ................. -5,531 -42,158 662% -502 -3,872 671% Net income before minority interest......$ -1,084,82$ -81,113 -93% -92,133 -7,138 -92% Minority interest...................... -8,767 -42,688 387% -755 -3,827 407% Majority net income....................$ -1,076,06$ -38,425 -96% -91,378 -3,311 -96% Operating income ...................... 164,675 233,452 42% 13,882 21,295 53% Depreciation & amortization ........... 205,151 207,415 1% 17,487 18,932 8% Interest income ....................... 11,350 16~~,696~~ ~~47%~~OF ~~959~~THE ~~1,503~~SECURITIES ~~57%~~EXCHANGE ~~Employee~~ACT ~~retirement~~OF ~~obligations ....... 1,937 17,259 791% 163 1,594 878% Allowance for doubtful accounts ....... 9,412 8,713 -7% 794 793 0% EBITDA ................................ 392,525 483,535 23% 33,285 44,117 33%~~1934

For the month of June 2006

Durango Corporation

(Translation of registrant’s name into English)

Torre Corporativa Durango, Potasio 150, Ciudad Industrial, Durango, Durango, Mexico 34208
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F x Form 40-F o

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes o No x

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-___.

EXHIBITS

Pursuant to Section 4.01(a) of the Common Agreement, dated as of February 23, 2005, among Corporación Durango, S.A. de C.V. (the “Company”), the Guarantors and Additional Guarantors named therein, the A Lenders named therein, The Bank of New York, as Administrative Agent, Law Debenture Trust Company of New York, as Trustee, Deutsche Bank Trust Company Americas, as Collateral Agent, Deutsche Bank Mexico, S.A., Institución De Banca Multiple, Trust Division, as Collateral Agent, Deutsche Bank Trust Company Americas, as Guarantor Paying Agent, and the Subordinating Creditors named therein, the Company is required to deliver to the Administrative Agent and the Trustee the audited unconsolidated balance sheet of the Company as at the end of each fiscal year, the related audited unconsolidated statements of income and statement of changes in financial position of the Company for such fiscal year and the notes thereto.

The following exhibit is furnished with this document:


Exhibit 1.		Financial statements of Corporación Durango, S.A. de C.V. at December 31, 2005 and 2004 and for the two years ended December 31, 2005 (unconsolidated).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	CORPORACION DURANGO, S.A. DE C.V.
Date: June 30, 2006	By:	/s/ Mayela Rincón de Velasco
		Name:	Mayela Rincón de Velasco
		Title:	Chief Financial Officer

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