6-K 1 gi6587.txt FORM 6-K ================================================================================ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 or 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 For the month of July, 2006 GRUPO IUSACELL, S.A. de C.V. ----------------------------------------------- (Translation of registrant's name into English) Montes Urales 460 Col. Lomas de Chapultepec, Deleg. Miguel Hidalgo 11000, Mexico D.F. ------------------------------------------------ (Address of principal executive office) Indicate by check mark whether the registrant files or will fill annual reports under cover of Form 20-F or Form 40-F: Form 20-F [X] Form 40-F [ ] 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 12g-3-2(b) under the Securities and Exchange Act of 1934. Yes [ ] No [X] ================================================================================ Documents Furnished By the Registrant 1. Press Release of the Registrant dated July 28, 2006 2 IUSACELL REPORTS SECOND QUARTER 2006 RESULTS - NET REVENUES INCREASE 27% - Mexico City, July 28, 2006 - Grupo Iusacell, S.A. de C.V. (BMV: CEL), reported its financial results corresponding to the second quarter of 2006. FINANCIAL INFORMATION Million pesos as of June 30, 2006

~~REGION~~Change ~~NUMBER~~Change ~~GEOGRAPHICAL COVERAGE MAJOR CITIES IN THE REGION~~ ------ -------------- ------------------ 2Q05 2Q06 $ % 6M05 6M06 $ % -------- -------- --------- -------- -------- -------- -------- ------ 1Net ~~The~~Revenues ~~states of Baja California and Baja California Sur Tijuana~~1,460 ~~Mexicali~~1,852 ~~Ensenada,~~392 ~~Tecate~~27% ~~and the municipality of San Luis Rio Colorado in and La Paz. northwestern Sonora state.~~ 2 ~~The states of Sonora and Sinaloa (except for the Hermosillo~~,831 ~~Ciudad Obregon~~3,653 ~~Culiacan~~822 ~~municipality~~29% ofTotal ~~San~~Cost ~~Luis~~763 ~~Rio Colorado in northwestern and Mazatlan. Sonora). 3 The states of Chihuahua and Durango and the Ciudad Juarez~~1,115 ~~Chihuahua,~~353 ~~Durango,~~46% ~~municipalities of Torreon~~1,440 ~~Francisco I. Madero~~2,210 ~~Gomez~~769 ~~Palacio~~53% ~~and~~Operating ~~Torreon.~~Expenses ~~Matamoros,~~389 ~~San~~437 ~~Pedro~~48 ~~and~~12% ~~Viesca~~808 in870 ~~the~~62 ~~state~~8% ofEBITDA ~~Coahuila.~~308 4300 ~~The states of Tamaulipas, Nuevo Leon and Coahuila Monterrey, Saltillo, Tampico, Ciudad~~ (~~except~~9) ~~for~~3% ~~the~~583 ~~municipalities~~573 ~~of Torreon, Francisco I. Victoria, Nuevo Laredo, Reynosa and Madero, Matamoros, San Pedro and Viesca~~(9). ~~Matamoros. 5 The states of Colima, Jalisco~~ (~~except~~2)% ~~for~~Net 12Loss ~~Guadalajara~~ (~~Mexico's~~34) ~~second largest municipalities in northeastern Jalisco~~(867), ~~Michoacan and city~~(833), ~~Morelia, Tepic, Colima and Nayarit~~(n. ~~Manzanillo~~m.) 6(409) ~~The states of Aguascalientes~~(1,355) ~~Guanajuato,~~(946) Queretaro, San Aguascalientes, Leon, Queretaro, San Luis Potosi and Zacatecas and 12 municipalities in Luis Potosi and Zacatecas. northeastern Jalisco. 7 The states of Guerrero, Oaxaca, Puebla, Tlaxcala and Puebla, Acapulco, Veracruz and Veracruz. Oaxaca. 8 The states of Yucatan, Quintana Roo, Campeche, Chiapas Merida, Cancun, Villahermosa, and Tabasco. Campeche, Tuxtla Gutierrez and San Cristobal de las Casas. 9 The states of Mexico, Hidalgo and Morelos and the Mexico City, Toluca, Cuernavaca and Federal District. Pachuca.(231)%

RECENT EVENTS As of July 2006, Iusacell's subscribers will now have international data service for easy access to mobile applications as a result of Iusacell's entering into a new agreement with Sprint of the USA. The Sprint data roaming agreement for coverage in North America is part of the international expansion of Iusacell in 2006. Iusacell is extending the network coverage for its clients through data roaming agreements. Under the terms of this agreement, our users will be able to have easy access to email, Internet and corporative applications in the United States using selected cellular telephones, intelligent devices and broadband mobile cards as if they were connected to the local network of Iusacell. 3 SECOND QUARTER RESULTS REVENUES Net revenues in the second quarter of 2006 increased by 27% to Ps $1,852 million, as compared to Ps $1,460 million during the same period 2005. The increase is primarily a result of growth in postpaid revenues as well as higher revenues from value added services mainly attributable to an increase in the subscriber base. Grupo Iusacell ended the second quarter of 2006 with 2.0 million subscribers. COST AND EXPENSES During the second quarter of 2006, total cost, increased by 46% to Ps $1,115 million as compared to Ps $763 million in the second quarter 2005. Operating expenses increased by 12% to Ps $437 million, as compared to Ps $389 million in the same period 2005. The increase in the total cost during the second quarter 2006 mainly reflects the increase in: (i) handset subsidy, (ii) the costs related to value added services and interconnection costs as a result of the increase in air time traffic and subscribers, (iii) technical expenses, and (iv) concessions rights. The increase in operating expenses during the second quarter 2006 mainly reflects an increase in administrative expenses owing to the creation of regional sales and customer care structures, offset by the reduction in advertising expenses. OPERATING INCOME BEFORE DEPRECIATION AND AMORTIZATION Iusacell's operating income before depreciation and amortization for the second quarter of 2006 was Ps $300 million, a decrease of 3% as compared to Ps $308 million during the same period the year before. NET INCOME Iusacell registered a net loss of Ps $867 million for the second quarter of 2006, compared to a net loss of Ps $34 million during the same period in 2005. This loss is mainly a result of an increase in integral financing costs affected mainly by the exchange loss derived from the increase in exchange rates of the peso against the dollar. CAPEX During the second quarter of 2006, the Company made investments of approximately US $17 million, mainly for the acquisition of cellular equipment related to the expansion of coverage and capacity of Iusacell's 3-G network and EV-DO services (Evolution Data Only). DEBT The Company continues with its debt restructuring process as announced through various press releases to date. In this respect and in furtherance of the debt restructuring process, the Company has commenced various proceedings for the legal implementation of the agreements reached with majority of its creditors, which we expect to be accomplished shortly. ********************** 4 ABOUT IUSACELL Grupo Iusacell, S.A. de C.V.(BMV: CEL)(Iusacell) is a wireless cellular and PCS service provider in Mexico with a national footprint. Iusacell offers more and better voice communication and data services through state-of-the-art technology, such as its new 3G network, throughout all of the regions in which it operates. In addition to our core mobile telephony services, we also provide a wide range of other telecommunications services, including long distance, wireless local telephony and data transmission services. Additional information is available at http://www.iusacell.com LEGAL DISCLAIMER Grupo Iusacell, S.A. de C.V. quarterly reports and all other written materials may from time to time contain statements about expected future events and financial results that are forward-looking and subject to risks and uncertainties. For those statements, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. A discussion of factors that may affect future results is contained in our filings with the Securities and Exchange Commission. Attached are the Consolidated Income Statements of each of Grupo Iusacell, S.A. de C.V. and Grupo Iusacell Celular, S.A. de C.V. for the three-month and six-month periods ended June 30, 2006, and the Consolidated Balance Sheet of Grupo Iusacell, S.A. de C.V. and Grupo Iusacell Celular, S.A. de C.V. at June 30, 2006. CONTACTS: --------- JOSE LUIS RIERA K. J. VICTOR FERRER V. Chief Financial Officer Finance Manager GRUPO IUSACELL S.A. DE C.V. GRUPO IUSACELL S.A. DE C.V. +52 (55) 5109-5927 +52 (55) 5109-5273 vferrer@iusacell.com.mx 5 GRUPO IUSACELL, S.A. DE C.V. AND SUBSIDIARIES MILLIONS OF MEXICAN PESOS OF JUNE 30, 2006 PURCHASING POWER (UNAUDITED FIGURES)

%QUARTERLY ~~DIRECT~~INCOME ~~AND~~STATEMENT ~~% DIRECT AND INDIRECT INDIRECT COUNTRY OF ECONOMIC VOTING SUBSIDIARY LINE OF BUSINESS INCORPORATION INTEREST INTEREST~~ ---------------------------------------- ----------------------------- 2Q05 2Q06 CHANGE --------------------- --------------------- --------------------- ~~Grupo~~Gross ~~Iusacell~~Revenues ~~Celular~~107% 1,560 ~~S.A.~~105% de1,947 ~~C.V~~387 ~~Cellular~~25% ~~Operator~~Commissions ~~Mexico~~(7)% (100.0) (5)% (95) 5 5% --------------------- --------------------- Net Revenues 100.0% ~~Iusacell~~1,460 ~~PCS~~100% 1,852 ~~S.A.~~392 de27% ~~C.V~~--------------------- ~~Regions~~--------------------- ~~1and~~Cost 4of ~~PCS~~services ~~Mexico~~42% ~~100.0~~620 ~~100.0~~43% ~~Iusacell~~793 ~~PCS~~173 de28% ~~Mexico,~~Handset ~~S.A.~~Subsidy de10% ~~C.V.~~143 ~~(1)~~17% ~~Regions~~323 2,180 3,126% 5,--------------------- 6,--------------------- 7Total Cost 52% 763 60% 1,115 8353 ~~and~~46% 9--------------------- ~~PCS~~--------------------- ~~Mexico~~Gross ~~100.0~~Profit ~~100.0~~48% ~~Iusacell~~698 ~~Infraestructura,~~40% ~~S.A~~737 de39 ~~C.V~~6% ~~Microwave~~--------------------- ~~Financing~~--------------------- ~~Mexico~~Operating ~~100.0~~Expenses ~~100.0~~27% ~~Iusacell~~389 ~~Arrendadora,~~24% ~~S.A.~~437 de48 ~~C.V~~12% ~~Leases~~Depreciation ~~Mexico~~and ~~100.0~~Amortization ~~100.0~~27% ~~Iusacell~~398 ~~Infraestructura~~20% de379 ~~Mexico,~~(19) ~~S.A.~~(5)% de--------------------- ~~C.V~~--------------------- ~~Microwave~~Total ~~Financing~~Expenses ~~Mexico~~54% ~~100.0~~787 ~~100.0~~44% ~~SOS~~816 ~~Telecomunicaciones,~~30 ~~S.A.~~4% de--------------------- ~~C.V.~~--------------------- Operating Loss (26)% ~~Region~~(89) 9(4)% ~~Cellular~~(79) ~~Mexico~~10 ~~100.0~~11% ~~100.0~~--------------------- ~~Comunicaciones~~--------------------- ~~Celulares~~Operating deProfit ~~Occidente,~~before ~~S.A.~~Depreciation deand ~~C.V.~~Amortization 21% 308 16% 300 (9) (3)% ~~Region~~--------------------- 5--------------------- ~~Cellular~~Loss ~~Mexico~~from ~~100.0~~sale ~~100.0~~of ~~Sistemas~~fixed ~~Telefonicos~~assets ~~Portatiles~~and ~~Celulares,~~other ~~S.A.~~expenses de1% ~~C.V.~~10 ~~(2)~~1% ~~Region~~11 62 ~~Cellular~~19% ~~Mexico~~Comprehensive ~~100.0~~Financing ~~100.0~~Cost ~~Telecomunicaciones~~Interest ~~del~~Expense ~~Golfo,~~- ~~S.A.~~Net de(19)% ~~C.V.~~(283) (217)% ~~Region~~(310) 7(27) ~~Cellular~~(9)% ~~Mexico~~Exchange ~~100.0~~gain ~~100.0~~(loss) ~~Iusacell,~~29% ~~S.A.~~425 de(23)% ~~C.V.~~(430) (2856) ~~Sales~~(201)% ~~and~~Gain ~~Marketing~~from ~~Mexico~~net ~~100.0~~monetary ~~100.0~~position ~~Sistecel,~~(3)% ~~S.A.~~(49) de(3)% ~~C.V.~~(59) (210) ~~Administrative~~(20)% ~~Services~~--------------------- ~~Mexico~~--------------------- ~~100.0~~6% ~~100.0~~93 ~~Iusatel,~~(43)% S(800) (892) (n.Am.) de--------------------- C--------------------- Loss before taxes 1% 13 (47)% (868) (881) (n.Vm.) --------------------- --------------------- Tax Provisions (23)% ~~Long~~(44) ~~Distance~~(0)% ~~Mexico~~(1) ~~100.0~~43 ~~100.0~~97% ~~Iusatel~~Equity ~~USA,~~in ~~Inc.~~income (4loss) ~~Long~~of ~~Distance~~subsidiaries ~~E.U.~~0% ~~United~~- ~~Status~~0% ~~100.~~0 ~~100.~~0 ~~Iusatelecomunicaciones, S~~n.Am. deMinority ~~C.V.~~interest (20)% ~~Local~~(3) ~~Wireless~~0% ~~Mexico~~2 ~~100.0~~5 ~~100.0~~180% ~~Punto~~-a-~~Punto~~------------------- ~~Iusacell,~~--------------------- ~~S.A.~~--------------------- deNet ~~C.V.~~loss (2)% ~~Microwave~~(34) ~~transmissions~~(47)% ~~Mexico~~(867) ~~100.0~~(833) ~~100~~(n.0m.) ===================== ===================== =====================

6 GRUPO IUSACELL, S.A. DE C.V. AND SUBSIDIARIES MILLIONS OF MEXICAN PESOS OF JUNE 30, 2006 PURCHASING POWER (UNAUDITED FIGURES)

ACCUMULATED INCOME STATEMENT --------------------------------------------------------------------- 6M05 6M06 CHANGE --------------------- --------------------- --------------------- Gross Revenues 107% ~~DIRECT~~3,035 ~~AND~~106% 3,859 824 27% ~~DIRECT~~Commissions ~~AND~~(7)% ~~INDIRECT~~(204) ~~INDIRECT~~(6)% ~~COUNTRY~~(206) OF(2) ~~ECONOMIC~~(1)% ~~VOTING~~--------------------- ~~SUBSIDIARY~~--------------------- ~~LINE~~Net OFRevenues ~~BUSINESS~~100% ~~INCORPORATION~~2,831 ~~INTEREST~~100% ~~INTEREST~~3,653 822 29% --------------------- --------------------- Cost of services 43% 1,219 43% 1,576 357 29% Handset Subsidy 8% 221 17% 634 412 186% --------------------- ---- ----------------- Total Cost 51% 1,440 60% 2,210 769 53% --------------------- --------------------- ~~Infotelecom~~Gross Profit 49% 1,391 ~~S.A.~~40% de1,443 ~~C.V.~~53 4% --------------------- --------------------- Operating Expenses 29% 808 24% 870 62 8% Depreciation and Amortization 28% 793 21% 774 (19) (2)% ~~Paging~~--------------------- ~~Mexico~~--------------------- ~~51.0~~Total ~~51.0~~Expenses ~~Inmobiliaria~~57% ~~Montes~~1,601 ~~Urales~~45% ~~460~~1,644 ~~S.A.~~43 de3% ~~C.V.~~--------------------- --------------------- Operating Loss (27)% ~~Real~~(211) ~~State~~(5)% ~~Mexico~~(201) ~~100.0~~10 ~~100.0~~5% ~~Iusanet,~~--------------------- ~~S.A.~~--------------------- deOperating ~~C.V.~~Profit before Depreciation and Amortization 21% 583 16% 573 (9) (2)% ~~Services~~--------------------- ~~Mexico~~--------------------- ~~100.0~~Loss ~~100.0~~from ~~Editorial~~sale ~~Celular,~~of Sfixed assets and other expenses (1)% (24) 5% 165 189 n.Am. deComprehensive ~~C.V~~Financing Cost Interest Expense - Net (220)% ~~Publishing~~(556) ~~Mexico~~(16)% ~~40.0~~(594) ~~40.0~~(38) ~~Grupo~~(7)% ~~Portatel~~Exchange gain (loss) 14% 405 (21)% (755) (1,160) ~~S.A.~~(287)% deGain ~~C.V.~~from net monetary position 1% 36 1% 27 (29) ~~Holding~~(24)% ~~company~~--------------------- ~~for~~--------------------- ~~Portatel~~(4)% ~~del~~(115) ~~Sureste~~(36)% (1,321) S(1,207) (n.Am.) de--------------------- C--------------------- V.Loss ~~Mexico~~before ~~100.0~~taxes ~~100.0~~(24)% ~~Portatel~~(349) ~~del~~(37)% ~~Sureste~~(1,357) ~~S.A.~~(1,008) de(288)% ~~C.V.~~--------------------- --------------------- Tax Provisions (52)% ~~Region~~(58) 8(0)% ~~Cellular~~(1) ~~Mexico~~57 ~~100.0~~98% ~~100.~~Equity in income (loss) of 0% ~~Mexican~~- ~~Cellular~~(0)% ~~Investment,~~(0) ~~Inc.~~(0) (2n.m.) ~~Holding~~subsidiaries ~~company~~Minority ~~for~~interest ~~Comunicaciones~~(0)% ~~Celulares~~(1) de0% ~~Occidente,~~3 S5 n.Am. de--------------------- ~~C.V.~~--------------------- ~~United~~--------------------- ~~States~~Net ~~100.0~~loss ~~100.0~~(14)% (409) (37)% (1,355) (946) (231)% ===================== ===================== =====================

7 GRUPO IUSACELL, S.A. DE C.V. AND SUBSIDIARIES MILLIONS OF MEXICAN PESOS OF JUNE 30, 2006 PURCHASING POWER (UNAUDITED FIGURES)

AS2Q05 OF2Q06 ~~AND~~CHANGE ~~FOR THE YEAR ENDED DECEMBER 31,~~ --------------------- --------------------- ---------------------~~------------------~~ ~~2001~~Cash ~~2002~~and ~~2003~~cash ~~2004~~equivalents ~~2005~~4 ~~2005~~0% ~~-----------~~31 ~~-----------~~0% ~~-----------~~27 ~~-----------~~n.m. ~~-----------~~Customers ~~-----------~~389 ~~(Thousands~~4% of465 ~~constant~~4% ~~pesos~~76 as19% ofDue ~~December~~from ~~31,~~related ~~2005~~parties ~~except~~96 ~~per~~1% ~~(Thousands~~310 ~~share~~3% ~~and~~214 ~~operating~~224% ~~data)(1)~~Advanced ofpayments ~~U.S.~~and ~~dollars,~~other ~~except~~receivables ~~per~~314 ~~share~~3% ~~and~~249 ~~operating~~2% ~~data~~(65) (221)% ~~INCOME~~Unamortized ~~STATEMENT~~handset ~~DATA:~~subsidy ~~Mexican~~275 ~~GAAP:~~3% ~~Revenues~~441 ~~from services .................... 7,323,613 6,051,803~~ 4~~,769,108~~% ~~5,188,044~~166 ~~6,506,911~~60% ~~612,242~~Inventories ~~Commissions~~100 ~~(3)~~1% ~~...........................~~42 ~~(481,546)~~0% (~~423,333~~58) (~~247,138~~58)% ~~(325,684) (384,812) (36,207)~~ ----------- ----------- ----------- ----------- ~~-----------~~Current ~~-----------~~assets ~~Net~~1,177 ~~revenues~~11% ~~....................... 6~~1,~~842,067~~536 ~~5,628,470~~14% ~~4,521,970~~359 ~~4,862,360~~31% Fixed assets 6,~~122,099~~696 ~~576~~62% 5,~~035~~843 ~~Cost~~53% of(852) ~~sales:~~(13)% ~~Cost~~Goodwill of- ~~services~~Net ~~....................... 2~~1,~~128,577~~857 ~~2,023,685~~17% 1,~~652,158~~862 ~~2,196,656~~17% ~~2,728,617~~4 ~~256,739~~0% ~~Handsets~~Other ~~subsidy~~assets ~~(3) (4) ...............~~ 1,~~353,680~~100 ~~624,684~~10% ~~643~~1,~~623~~772 ~~896,158~~16% ~~653,519~~673 61~~,490~~% ----------- ----------- ----------- ----------- ~~----------- -----------~~ Total ~~cost~~assets ~~of sales ................ 3~~10,~~482,257~~829 ~~2,648,369~~100% 211,~~295,781~~013 ~~3,092,814~~100% ~~3,382,136~~184 ~~318,229 Gross profit .............................. 3,359,810~~ 2~~,980,101~~% 2,226,189 1,769,546 2,739,963 257,806 Operating expenses ........................ 1,931,017 1,526,486 1,745,661 1,308,870 1,700,471 159,999 Depreciation and amortization (4) ......... 1,864,762 2,084,590 2,236,654 2,026,884 1,567,003 147,441 ----------- ----------- ----------- ----------- Short-~~----------~~term ~~-----------~~debt ~~Operating loss ............................ (435~~8,~~969)~~773 ~~(630,975)~~81% (18,~~756,126)~~945 ~~(1,566,208)~~81% ~~(527,511)~~172 ~~(49,634)~~2% ~~Gain~~Accrued ~~(loss)~~interest ~~from sale of fixed assets (3).............................. 367~~2,~~806~~022 ~~114,125~~19% 962,~~254~~900 ~~214,853~~26% ~~(4,860)~~878 ~~(457)~~43% ~~Intangible assets' write~~--~~off .............~~ -- -- ~~(380,709)~~ -- -- -- ~~Valuation of abandoned fixed assets .......~~ -- -- ~~(439,880)~~ -- --- -- ~~Early extinguishment of debt (5) ..........~~ -- -- ~~16,866 41,722~~ -- ------------- ~~Other~~Short-term ~~expense,~~liabilities ~~net~~with ~~........................~~financial --cost ~~-- (681~~10,~~080)~~795 (100% 11,~~587)~~845 ~~(28,158)~~108% (21,~~649)~~050 ~~Integral~~10% ~~financing~~Suppliers ~~cost~~284 ~~(gain):~~3% ~~Interest~~436 ~~expense,~~4% ~~net~~152 ~~..................~~54% ~~966,059~~Related ~~1,017,255~~parties ~~1,052,272~~220 ~~1,118,892~~2% ~~1,121,648~~220 ~~105,537~~2% ~~Foreign~~0 ~~exchange~~0% ~~(gain)~~Unaccrued ~~loss,~~air ~~net~~time ~~......~~165 ~~(268,541)~~2% 63 1~~,162,623~~% ~~809,231~~ (~~72,040~~102) (~~573,635~~62)% ~~(53,974)~~Accumulated ~~Gain~~expenses ~~from~~and ~~monetary~~other ~~position~~payables ~~............~~949 ~~(318,514)~~9% ~~(469~~1,~~735)~~012 ~~(381,361)~~9% ~~(481,661)~~64 ~~(449,748)~~7% ~~(42,317)~~ ----------- ----------- ----------- ---------- Short-term liabilities without financial cost 1,617 15% 1,731 16% 114 7% --------------------- ----------- ~~Total .................................. 379,004 1,710,143 1,480,142 565,191 98,265 9,246 Equity participation in net (loss) profit of associated companies ......... 7,787 (11,009) (19,070) (13,760)~~ -- -------- ~~Income~~SHORT-TERM ~~(loss)~~LIABILITIES ~~before~~12,412 ~~assets~~115% ~~tax~~13,576 ~~income~~123% ~~tax~~1,164 ~~minority~~9% ~~interest~~LONG-TERM ~~and~~LIABILITIES ~~cumulative~~25 ~~effect~~0% of- ~~change~~0% ~~of accounting policy ...................~~ (~~439,380~~25) (~~2,238,002~~100)% ~~(4,643,887)~~Advances ~~(1,900,171)~~from ~~(658,794)~~customers ~~(61,986) Provisions for: Asset tax .............................. 174,895 125,700 159,263 160,677 54,579 5,135 Income tax .............................~~ -- ~~10,454~~878 ~~178,095~~8% --878 --100% -- ----------- --------~~---~~ ----------- ----------- ~~-----------~~STOCKHOLDERS' ~~-----------~~EQUITY ~~Total ..................................... 174,895 136,154 337,358 160,677 54,579 5,135 Loss before minority interest and cumulative effect of change of accounting policy ......................~~ (~~614~~1,~~275~~608) (~~2,374,156~~15)% (43,~~981,245~~441) (~~2,060,848~~31)% (~~713~~1,~~373~~833) (~~67,121~~114)% ~~Minority interest ......................... 24,721 18,800 36,018 5,447 7,858 739~~ ----------- ----------- ----------- ----------- ~~-----------~~LIABILITIES ~~-----------~~+ ~~Loss~~EQUITY ~~before~~10,829 ~~cumulative~~100% ~~effect of change of accounting policy ............ (589~~11,~~554)~~013 ~~(2,355,356)~~100% ~~(4,945,227)~~184 (2~~,055,401)~~% ~~(705,515) (66,382) Cumulative effect of change of accounting policy(4) ................... (7,739)~~ -- ~~(172,838)~~ -- -- -- ----------- --~~---------~~ ----------- ----------- ----------- ----------- Net profit (loss) ......................... (597,293) (2,355,356) (5,118,065) (2,055,401) (705,515) (66,382) =========== =========== =========== =========== =========== =========== BALANCE SHEET DATA: Mexican GAAP: Working capital ........................... 416,695 (103,520) (10,643,932) (11,437,219) (11,282,136) (1,061,548) Property and equipment, net ............... 11,311,803 10,586,839 8,357,448 7,307,684 6,288,552 591,697 Total assets .............................. 19,796,690 17,091,414 12,849,400 11,338,232 10,822,338 1,018,285 Total debt ................................ 8,778,321 9,489,079 9,670,613 9,127,980 8,405,988 790,928 Total stockholders' equity ................ 8,556,875 6,063,574 881,813 (1,186,964) (2,075,985) (195,332) Capital stock ............................. 8,069,043 8,069,043 8,069,043 8,075,314 8,075,314 759,815

8 GRUPO IUSACELL CELULAR, S.A. DE C.V. AND SUBSIDIARIES FIGURES IN MILLION OF CONSTANT JUNE 30, 2006 PESOS

ASINCOME OFSTATEMENT ~~AND FOR THE YEAR ENDED DECEMBER 31,~~ --------------------------------------------------------------------- 2Q05 2Q06 CHANGE ------------ ~~2001 2002 2003 2004 2005 2005~~ --------- -- ----------- -------- --- ------------------ Revenue 107% 1,623 105% 2,021 399 25% Commissions (7)% (100) (5)% (95) 5 5% --------------------- --------------------- ~~(Thousands~~Net ofRevenue ~~constant~~100% ~~pesos~~1,523 as100% ~~of December 31~~1,927 ~~2005~~404 ~~except~~27% ~~per~~--------------------- ~~(Thousands~~--------------------- ~~share~~Cost ~~and operating data)(1)~~ of ~~U.S.~~services ~~dollars,~~41% ~~except~~629 ~~per~~45% ~~share~~863 ~~and~~235 ~~operating~~37% ~~data)(2)~~Handsets ~~OTHER~~subsidy ~~FINANCIAL~~9% ~~DATA:~~143 ~~Mexican~~17% ~~GAAP:~~323 ~~Capital~~180 ~~expenditures(6)~~ n.m.~~.................~~ ~~2,367,618~~--------------------- ~~961,724~~--------------------- ~~222,711~~Total ~~426,248~~Cost ~~429,587~~51% ~~40,420~~772 ~~Interest~~62% ~~expense~~1,186 ~~net~~414 ~~.....................~~54% ~~966,059~~--------------------- ~~1,017,255~~--------------------- ~~1,052,272~~Gross ~~1,118,892~~Profit ~~1,121,648~~49% ~~105,537~~751 ~~Ratio~~38% of741 ~~earnings~~(10) ~~to fixed charges~~(71)% ~~.............................~~ -- -- -- -- ------------- --------------------- Operating ~~Data:~~expenses ~~Covered~~25% ~~POPs(8)~~382 ~~...........................~~22% ~~89,917,967~~427 ~~91,356,654~~46 ~~92,589,969~~12% ~~93,840,000~~Depreciation ~~103,091,627~~and ~~103,091,627~~amortization ~~Subscribers:~~24% 359 18% 341 (918) ~~Postpaid~~(5)% ~~...............................~~--------------------- ~~366,226~~--------------------- ~~307,129~~Total ~~276,730~~Expenses ~~350,847~~49% ~~583,695~~741 ~~583,695~~40% ~~Prepaid~~769 ~~................................~~28 ~~1,488,940~~4% ~~1,774,071~~--------------------- ~~999,033~~--------------------- ~~1,111,893~~Operating Loss 1~~,273,370~~% 10 (1~~,273,370~~)% (28) (38) n.m. ----------- ----------- ----------- ----------- EBITDA 24% 369 16% 313 (56) 15% --------------------- --------------------- ~~Total~~(Profit) ~~subscribers~~loss ~~..................~~from ~~1,855,166~~fixed ~~2,081,200~~assets ~~1,275,763~~sales 1~~,462,740~~% ~~1,857,065~~10 ~~1,857,065~~0% ~~Gross~~7 ~~subscriber~~(2) ~~additions~~ n.m.~~..............~~ ~~1,051,089~~Integral ~~1,122,024~~Financing ~~593,284~~Cost ~~821,765~~Interest 1expense,~~063,385~~ ~~1,063,385~~net ~~Average~~(8)% ~~subscribers~~(10124) ~~...................~~(8)% ~~1,721,072~~(156) ~~2,091,765~~(33) ~~1,810,101~~(27)% ~~1,340,102~~Foreign ~~1,630,300~~exchange ~~1,630,300~~loss ~~Average~~(gain) ~~monthly~~14% ~~postpaid~~208 ~~churn~~(1110)% (200) (408) n.m.~~......~~ ~~3.82%~~Gain ~~3.63%~~from ~~3.31~~monetary position (1)% ~~2.76~~(15) (1)% 2.(26) (11) (75)% ~~2.26~~--------------------- --------------------- 5% ~~Penetration~~70 (1220)% (382) (452) n.m.~~.........................~~ ~~2.10%~~--------------------- ~~2.28%~~--------------------- ~~1.38%~~Loss ~~1.56%~~Before ~~1.80%~~Taxes ~~1.80~~6% ~~Average~~90 ~~monthly~~(21)% ~~MOUs~~(402) ~~per subscriber~~(13492) n.m.~~.......................~~ 84--------------------- 63--------------------- 74Taxes ~~141~~(3)% ~~172~~(44) ~~172~~(6)% ~~Nominal~~(111) ~~average~~(67) ~~monthly~~n.m. ~~mobile~~Equity ~~telephony~~participation ~~revenue~~in ~~per~~net ~~subscriber~~loss (~~ARPU~~income)~~(14)~~ ~~.............................~~of ~~267~~subsidiaries ~~191~~0% ~~190~~- ~~293~~0% ~~307~~- 28- n.9a. ~~Nominal~~Extraordinary ~~cost~~item to0% ~~acquire~~- 0% - - n.a. ~~new~~Minority ~~subscriber~~interest (150)% ~~.........................~~(3) ~~2,677~~0% 2~~,419~~ ~~3,004~~5 180% --------------------- --------------------- --------------------- Net Profit (Loss) 3~~,059~~% ~~2,730~~43 ~~257~~(27)% (511) (554) n.3a. ===================== ===================== =====================

9 GRUPO IUSACELL CELULAR, S.A. DE C.V. AND SUBSIDIARIES FIGURES IN MILLION OF CONSTANT JUNE 30, 2006 PESOS

~~YEAR~~INCOME ~~ENDED~~STATEMENT ~~DECEMBER 31,~~ --------------------------------------------------------------------- ~~2003~~6M05 ~~2004~~6M06 ~~2005~~ CHANGE -------- ------------- --------------------- --------------------- ~~Ps.~~Revenue ~~Ps.~~107% ~~Ps.~~3,121 105% 3,999 878 28% Commissions (7)% (204) (5)% (206) (2) (1)% -------- ------------- -------- ------------- ~~(In~~Net ~~millions~~Revenue of100% ~~constant~~2,917 ~~pesos~~100% as3,793 876 30% --------------------- --------------------- Cost of ~~December~~services 3147% 1,372 ~~2005~~45% 1,701 ~~except~~329 ~~percentages)~~24% ~~Revenues~~Handsets ~~from~~subsidy ~~services~~8% ~~..........~~221 ~~4,769.~~17% 634 412 186% --------------------- --------------------- Total Cost 55% 1,593 562% 2,~~188.0~~335 6741 47% --------------------- --------------------- Gross Profit 45% 1,~~506.9~~323 38% 1,459 135 10% --------------------- --------------------- Operating expenses 27% 795 22% 852 56 7% Depreciation and amortization 25.4% ~~Commissions~~718 ~~.....................~~18% ~~(247.1)~~698 (~~325.7~~19) (~~384.8~~3)% ~~18.~~--------------------- --------------------- Total Expenses 52% 1,513 41% ~~Cost~~1,550 of37 ~~sales~~2% ~~...................~~--------------------- --------------------- Operating Loss (~~2,295.8~~6)% (~~3,092.8~~189) (~~3,382.1~~2)% ~~9.4~~(91) 98 52% ~~Operating~~--------------------- ~~expenses~~--------------------- ~~..............~~EBITDA 18% 528 16% 607 79 15% --------------------- --------------------- (~~1,745.7~~Profit) loss from fixed assets sales (1~~,308.9~~)% (~~1,700.5~~24) ~~29.9~~4% ~~Depreciation~~162 ~~and~~186 ~~amortization~~ n.m.. (2Integral Financing Cost Interest expense,~~236.7~~ net (8)% (~~2,026.9~~237) (~~1,567.0~~8)% (~~22.7~~296) (59) (25)% ~~Operating~~Foreign exchange loss ~~..................~~ (~~1,756.1~~gain) 7% 198 (~~1,566.2~~9)% (~~527.5~~356) (~~66.3~~555)% ~~Results~~n.m. Gain from ~~sale~~monetary ofposition ~~fixed~~1% ~~assets~~21 ~~96.3~~0% ~~214.9~~12 (4.9) (~~102.3~~43)% ~~Special~~--------------------- ~~items~~--------------------- ~~...................~~(1)% (~~820.6~~17) (17)% (640) (623) n.m. -- ------------------- --------------------- ~~Early~~Loss ~~extinguishment~~Before ofTaxes ~~debt~~(8)% ~~....~~(230) ~~16.9~~(15)% ~~41.7~~(570) --(339) (~~100.0~~147)% ~~Other~~--------------------- ~~expenses,~~--------------------- ~~net~~Taxes ~~.............~~(2)% (~~681.1~~58) (~~11.6~~3)% (~~28.2~~111) ~~143~~(53) n.1m. Equity participation in net loss (income) of subsidiaries 0% ~~Integral~~- ~~financing~~0% ~~cost~~- - n.a. Extraordinary item 0% - 0% - - n.a.~~.....~~ ~~(1,480.1)~~Minority ~~(565.2)~~interest (~~98.3~~0)% (~~82.6~~1) 0% ~~Net~~3 ~~loss~~5 n.m.~~......................~~ --------------------- --------------------- --------------------- Net Loss (~~5,118.1~~10)% (~~2,055.4~~289) (~~705.5~~18)% (~~65.7~~677) (388) (134)% ===================== ===================== =====================

10 GRUPO IUSACELL CELULAR, S.A. DE C.V. AND SUBSIDIARIES FIGURES IN MILLION OF CONSTANT JUNE 30, 2006 PESOS

~~YEAR~~6M05 ~~ENDED~~6M06 ~~DECEMBER~~CHANGE ~~31,~~ --------------------- --------------------- --------------------- ~~2004~~Cash ~~2005~~and ~~CHANGE~~marketable securities 3 0% 11 0% 9 n.a. Accounts receivable, net 388 4% 467 5% 79 20% Unamortized handset subsidy 275 3% 441 4% 166 60% Related parties 347 4% 705 7% 358 103% Recoverable taxes and other 260 3% 207 2% (53) (20)% Inventories 100 1% 42 0% (58) (58)% --------------------- ---------------- ------ ~~Ps.~~TOTAL CURRENT ASSETS 1,371 14% Ps1,872 19% 501 37% Property and equipment, net 6,164 64% 5,226 53% (938) (15)% Excess of cost of investments in subsidiaries over book value, net 1,672 17% 1,672 17% (0) (0)% Other assets 435 5% 1,152 12% 716 165% ------- -------------- --------------------- TOTAL ASSETS 9,641 100% 9,920 100% 279 3% --------------------- --------------------- ~~(In~~Short-term ~~millions~~debt of4,602 ~~constant~~48% ~~pesos~~4,692 as47% of90 ~~December~~2% 31Accrued interest 466 5% 713 7% 247 53% Short-term liabilities with financial cost 5,068 ~~2005~~53% 5,405 ~~except~~54% ~~percentages~~337 7% Accrued liabilities 718 7% 593 6% (125) ~~Revenues~~(17)% ~~from~~Related ~~services~~parties ..221 52% 699 7% 478 217% Accounts payable 256 3% 129 1% (127) (50)% Unaccrued air time 165 2% 63 1% (102) (62)% --------------------- --------------------- Short-term liabilities without financial cost 1,~~188.0~~360 ~~106.~~14% 61,~~506.~~484 15% 124 9% ~~106.3~~SHORT-TERM LIABILITIES 6,428 67% ~~25.4~~6,890 69% ~~Commissions~~462 7% LONG-TERM LIABILITIES 0 0% - 0% (0) (100)% Advances from customers 878 9% 878 n.a.~~...........~~ --------------------- --------------------- Minority interest (~~325.7~~81) (~~6.7~~1)% (74) (~~384.8~~1)% 7 (~~6.3~~9)% ~~18.~~TOTAL SHAREHOLDERS' EQUITY 3,294 34% 2,226 22% (1,067) (32)% ------- ------ -------- ------ --------------- ~~Net~~TOTAL ~~revenues~~LIABILITIES ~~............~~AND 4SHAREHOLDERS'S EQUITY 9,~~862.3~~641 100.0% 69,~~122.1~~920 100.0% ~~25.9~~279 3% ~~=======~~--------------------- ~~======~~--------------------- ~~======= ====== ======~~---------------------

11 SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. GRUPO IUSACELL, S.A. DE C.V. Date: July 28, 2006 /s/ Fernando Cabrera --------------------------- Name: Fernando Cabrera Title: Attorney in fact /s/ Jose Luis Riera --------------------------- Name: Jose Luis Riera Title: Attorney in fact 12

YEAR ENDED DECEMBER 31, ------------------------------------------------------ 2004(1) 2005(1) CHANGE ------------------- ------------------- ------ Ps. % Ps % % ------- ------ ------- ------ ------ (In millions of constant pesos as of December 31, 2005, except percentages) Airtime(2) ........................ 1,349.7 26.0% 1,440.4 22.1% 6.7% Calling party pays revenues(3) .... 1,405.2 27.1% 1,401.3 21.5% (0.3)% Monthly fees ...................... 1,504.6 29.0% 2,169.8 33.3% 44.2% Long distance ..................... 318.1 6.1% 417.1 6.4% 31.1% Value-added services(4) ........... 84.9 1.6% 211.6 3.3% 149.2% In roaming ........................ 173.4 3.3% 198.3 3.0% 14.4% Out-roaming ....................... 159.0 3.1% 133.0 2.0% (16.4)% Short message services ............ 103.9 2.0% 256.9 3.9% 147.3% Other ............................. 89.2 1.7% 278.5 4.3% 212.2% ------- ------ ------- ------ ------ Total revenues from services ...... 5,188.0 100.0% 6,506.9 100.0% 25.4% ======= ====== ======= ====== ======

YEAR ENDED DECEMBER 31, ------------------------------------------------------- 2003 2004 CHANGE ------------------- ------------------- ------ Ps. % Ps % % ------- ----- ------- ----- ------ (In millions of constant pesos as of December 31, 2005, except percentages) Revenues from services ............ 4,769.1 105.5% 5,188.0 106.7% 8.8% Commissions ....................... (247.1) (5.5)% (325.7) (6.7)% 31.8% ------- ----- ------- ----- ------ Net revenues ...................... 4,522.0 100.0% 4,862.3 100.0% 7.5% ======= ===== ======= ===== ======

YEAR ENDED DECEMBER 31, ----------------------------------------------------- 2003(1) 2004(1) CHANGE ------------------ ------------------ -------- Ps. % Ps % % ------- ----- ------- ----- -------- (In millions of constant pesos as of December 31, 2005, except percentages) Airtime(2) ...................... 1,080.4 22.7% 1,349.7 26.0% 24.9% Calling party pays revenues(3) .. 1,303.7 27.3% 1,405.2 27.1% 7.8% Monthly fees .................... 1,468.8 30.8% 1,504.6 29.0% 2.4% Long distance ................... 360.4 7.6% 318.1 6.1% (11.7)% Value-added services(4) ......... 180.7 3.8% 84.9 1.6% (53.0)% In-roaming ...................... 159.6 3.3% 173.4 3.3% 8.6% Out-roaming ..................... 173.4 3.6% 159.0 3.1% (8.3)% Short message services .......... 6.1 0.1% 103.9 2.0% 1,603.3% Other ........................... 36.0 0.8% 89.2 1.7% 147.8% ------- ----- ------- ----- -------- Total revenues from services .... 4,769.1 100.0% 5,188.0 100.0% 8.8% ======= ===== ======= ===== ========

YEAR ENDED DECEMBER 31, --------------------------------------------------------- 2002 2003 CHANGE ------------------- ------------------- ------ Ps. % Ps % % ------- ----- ------- ----- ------ (In millions of constant pesos as of December 31, 2005, except percentages) Revenues from services .. 6,051.8 107.5% 4,769.1 105.5% (21.2)% Commissions ............. (423.3) (7.5)% (247.1) (5.5)% (41.6)% ------- ----- ------- ----- ------ Net revenues ............ 5,628.5 100.0% 4,522.0 100.0% (19.7)% ======= ===== ======= ===== ======

NAME AGE POSITION(S) ------------------------------------- ------- --------------------------------------- Ricardo Benjamin Salinas Pliego...... 50 Chairman of the Board of Directors Pedro Padilla Longoria............... 40 Vice Chairman of the Board of Directors Gustavo Guzman Sepulveda............. 52 Director Luis Jorge Echarte Fernandez......... 62 Director Joaquin Arrangoiz Orvananos.......... 49 Director Gonzalo Brockmann Garcia............. 51 Director Marcelino Gomez Velasco Sanroman..... 48 Director Manuel Rodriguez de Castro........... 41 Director

NAME AGE POSITION(S) ------------------------------------- ------- --------------------------------------- Gustavo Guzman Sepulveda............. 52 Chief Executive Officer Jose Luis Riera Kinkel............... 40 Chief Financial Officer Ricardo Benjamin Salinas Pliego...... 50 Executive Director Pedro Padilla Longoria............... 40 Executive Director Eduardo Kuri Romo.................... 36 Director, Systems Alejandra Ibarguengoitia Vazquez Aldana.............................. 36 Director, Marketing Franklin Moron Castillo.............. 39 Director, Sales Patricio Medina Moya................. 35 Director, Mobile Products Fernando Jose Cabrera Garcia......... 41 General Counsel and Secretary non-member of the Board

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