Interim Results - Part 2

Telefonica SA
4 September 2000


PART 2

TERRA NETWORKS GROUP

It's worth to mention that in the second quarter 2000 was undoubtedly the
announcement of the acquisition of Lycos on May 17, 2000.  This transaction 
will help Terra to become the world's number three Internet company and a global
operator. As a result of this agreement, Terra will have a presence in 37
countries across four continents. But at the same time, what makes this deal
unique is, on one hand, the commitment of Bertelsmann - the world's
third-largest media group - to offer preferential access to its content and use
Terra as its main content distributor across the Internet, which should generate
significant revenues, some already secured, and on the other hand, the company's
cash position after the planned capital increase.

The terms of the purchase are basically that for each Lycos share Terra will 
pay Lycos shareholders the equivalent of US$97.55 in newly issued Terra shares.
There will also be a further EUR2.2 billion issue at EUR62euros, underwritten by
Telefonica.

Also in second quarter 2000, Terra continued its strategy of geographical
expansion and consolidation in Latin America.  As well as launching portals in 
Central America towards the end of the second quarter 2000, portals were
launched in April and June in Venezuela and Uruguay.  Similarly, one of the
first big steps of the third quarter was the announcement in July of Terra's
entry into the Colombian market with the acquisition of the country's leading
portal and a string of major content deals.  This means Terra is now present  in
15 Spanish and Portuguese-speaking countries: Spain, Brazil, Mexico, Chile, 
Peru, Argentina, Venezuela, Guatemala, Honduras, Costa Rica, El Salvador,
Nicaragua, Uruguay, Colombia and the US.

Meanwhile, Terra has continued its acquisition strategy and alliances with 
companies aimed at vertical integration in the main e-commerce categories,  
particularly logistics and distribution (Telepizza), education (Ifegenia), 
auto-trade (MotorPress) and finance (Banco Popular, Renta 4, E-Cortal).

On the content front, the most significant developments were deals with Real 
Networks to distribute multi-media content, Real Names, to offer easier internet
searches, and Vignette, with its content management application. Crucially,
Terra can still count on the support of Telefonica Group to exploit synergies
with the group's different business lines.

Progress on Internet access platforms include: WAP access was successfully
launched in Brazil, flat-rate access in Spain and a joint venture set up with
Telefonica Moviles which gives Terra a 49% stake in the wireless portal
business.

Terra's results from operations continue to show strong growth. It now has 2.7
million subscribers for its Internet access service, double the number at the
end of 1999. During second quarter 2000 the Group signed up 667,000 new
subscribers.

Terra is now receiving 1 billion page hits per month, more than 30 million
daily. This is an increase of more than 300 million page views since March, a
46% increase from first quarter 2000.

Group revenues were EUR80.6 million, an increase of 178% over 1H99 proforma 
revenues. Breaking down revenues by business line shows that 64% of revenues 
came from access services and 24% from the portal.  Revenues from Internet
access provision was mainly derived from paying customers and induced traffic
agreements which accounted for 16% of access revenues. As for the portal,
advertising revenues accounted for EUR16.9 million during the first six months
of 2000. In the three months between April and June advertising revenues nearly
doubled from the first quarter.

TPI - PAGINAS AMARILLAS

Revenues for the first half 2000 were EUR107.3 million, a 12.2% increase from 
same period of 1999. The break down of revenues by product line shows:

Paper products (traditional directories) performed in line with company
forecasts.  A total of 23 Yellow Pages and 10 White Pages directories were
published generating EUR100.2 million in revenues, a 17.8% rise from the first
half 1999.

*  During the first half of 2000 the company brought-out 23 Yellow Pages 
directories compared to 21 in the equivalent period of 1999.  A book-by-book
comparison reveals a 9.5% rise in revenues. During 2000, the company expects  to
publish a total of 62 Yellow Pages directories, one more than in 1999 due  to
the splitting of the Zaragoza directory into separate residential and business
directories.

*  10 White Pages directories were published from the 61 directories the 
company plans to publish by year-end, two less than the same period of 1999. 
For calendar reasons, none of the 10 directories published in this first half 
of the year coincided with the twelve books published in the first half of 1999.

Directory-by-directory comparisons show a 7.9% decrease in revenues as a result
of the negative response from clients managed by Telefonica.  Paginas Blancas 
results are in line with company forecasts and underline the massive marketing
effort by the sales force, they have raised revenues from EUR2.4 million for the
previous edition to more than EUR5.7 million.


Multimedia products experienced rapid growth, thanks to the popularity of the
new Yellow Pages Online, whose revenues grew 490% to EUR3.4 million, and new
developments and launches in the first half of 2000.  In terms of traffic, page
views rose 36% compared to first quarter 2000, when visits were up 4.6%. It is
worth mentioning that in the first half of 2000 the company received first
banner revenues, EUR0.4 million.

One multimedia product, Paginas Amarillas Habladas (Talking pages), made
revenues of EUR1.5 million. The number of calls to the service grew 15.5%
compared to first quarter 2000 to 365,216 calls.

Operating profit rose 14.6% to EUR30.6 million.

Net profit was EUR20.1 million, down 43.6% during the same period of 1999.  This
decrease on the bottom line reflects the EUR28.3 million capital gain in  the
first half 1999 on TPI's pre-flotation sale of Estratel, Venturini and
DoubleClick.

Significant developments in second quarter 2000 included the start of the 
commercial campaign in Sao Paulo City in May, the adaptation of Yellow Pages, 
White Pages and City Guides to be accessed via WAP technology, and the relaunch
of the travel business vertical portal Viajarhoy.com.  A deal was also signed to
access our Yellow Pages and White Pages databases through the Ya.com portal
network (subsidiary of Jazztel), on the same basis as similar agreements reached
with MSN, Terra, Lycos and Altavista.

On August 4, 2000, TPI and Brazil's Guia Local Networks SA agreed that TPI would
acquire a 20% stake in Guia Local Networks SA, one of the main Brazilian
Internet city guide portals for R$2.5 billion.

TELEFONICA INTERCONTINENTAL

Following the sale of European Telecom and Acea Telefonica to Telefonica Data, 
Telefonica InterContinental is now wholly dedicated to operate mobile services
in Europe and in the Mediterranean  basin.  Major operations during the last
quarter were implementing the GSM mobile licence in Morocco through the
Consortium MediTelecom, and the management of Telefonica strategy for European
3G mobile licences.

MediTelecom continued to develop its offer of mobile services in the Moroccan 
market achieving rapid growth. The client base is now  232,425 customers, a 62%
rise on March and a 19% market share achieved in just 3 months. Coverage now
extends to 50% of the population and the company has 400 points of sale across
the country.

The consortium led by Telefonica InterContinental bidding for third generation 
licences in Germany (Group 3G) won one of six licences awarded at the end of 
August for EUR 8,409 million.  Currently the consortium consists of Telefonica
InterContinental with a 57.2% stake and Sonera with 42.8%, and it is expected to
open the consortium to new entrants.

In Italy, Telefonica Moviles SA formalised the Consortium Ipse 2000 to  bid for
third generation Italian licences, expected to take place in October 2000.  Ipse
is made up of Telefonica Moviles SA (30%), Sonera (19%), Atlanet (19%), Banca di
Roma (19%), Goldenegg (7%), Xera (5.5%) and e.Planet (0.5%) although changes in
structure are still possible until September 11.

In  France a consortium consisting of Telefonica InterContinental (40%) and 
Suez Lyonnaise des Eaux (60%) will bid for one of four licences on offer.  The
expected schedule is for bids to be submitted by 31 January 2001, with licences
awarded in June 2001. New partners are expected.

In Switzerland, a consortium including Telefonica InterContinental (33.3%), 
Sonera (33.3%) and One.Tel (33.3%) will bid for one of four UMTS licences,
expected to take place in November 2000.

Telefonica InterContinental is also putting together consortia to bid for 3G
licences in Scandinavia, through its links with Sonera and local partners.

ATENTO

Atento  continued  to expand its call centre operations in the second quarter 
of 2000, and increased the number of call-centre positions in the countries
where it operates.

In late March 2000, Atento Group had more than 16,000 call-centre positions 
staffed by more than 26,000 operators. By the end of June 2000 these figures had
risen to over 20,000 and 30,000 respectively.

Atento group revenues in the first half 2000 were close to EUR 200 million,  a
174.2% rise on the previous year as Atento's Latin American subsidiaries came
on-stream, having been in the process of setting up last year. EBITDA grew to
over 18 million euros.

Major developments included the launch of Atento Espana on June 7, 2000: Spain's
market leader in integral eCRM solutions.  The company started operations with
5,500 call centre positions across the whole country filled by 13,000 operators.
This allows the company to handle more than 220 million calls annually with a
target revenues for 2000 of  EUR 198 million.

Also, on July 4, 2000, Atento unveiled its project to build a second Moroccan 
customer relations centre in Tetuan, in addition to the Casablanca one.  The 
new project would have more than 500 positions, initial investment is projected
at US$8 million and would create more than 1,000 jobs by the end of 2000.
Subsequently, Atento signed up for a joint venture with Japan's Pasona to create
a new company, Atento Pasona Inc., which is expected to start operating in the 
Japanese market from November 2000. Atento has most of the capital and the
company would not limit itself to the Japanese market, as it plans to extend 
the business across Asia and the Pacific basin.  Initial investment is expected
to approximately US$20 million to set up three new call-centres in Japan in the
first year of operations, with total installed capacity of 1,500 new positions.

FOR FURTHER INFORMATION CONTACT:

Investor relations Department.
Gran Via 28, 3a, 28013 Madrid,
Tel: 91 - 584 47 00 / 584 47 02 / 584 03 06.
Fax: 91 - 531 99 75.
E-mail: [e-mail]
E-mail: [e-mail]
E-mail: [e-mail]
www.telefonica.es


Telefonica, S.A.
Consolidated Income Statement Full Consolidation
Unaudited figures
  
                                                               Euros in millions
                                      January-June                       %
                                          2000           1999         Change

Operating revenues (1)                  13,278.0        10,731.1        23.7
Internal expand capitalized 
 in fixed assets (2)(3)                    440.7           447.9        (1.6)
Operating expenses                      (7,710.1)       (5,450.3)       41.5
 Supplies (3)                           (2,640.8)       (1,435.9)       83.9
 Personnel expenses                     (2,385.1)       (2,081.9)       14.6
 Subcontracts                           (2,466.5)       (1,767.1)       39.6
 Taxes                                    (217.7)         (165.4)       31.7
Other operating income
 (expense) net (1)                        (185.5)         (202.7)       (8.5)

EBITDA                                   5,823.2         5,526.0         5.4

Depreciation and amortization           (3,299.2)       (2,984.7)       10.5

Operating profit                         2,524.0         2,541.2        (0.7)
Profit from associated companies           (53.4)           (0.9)        n.s.
Financial income (expense) net            (772.0)         (756.6)        2.2
Amortization of goodwill                  (163.6)          (81.9)       99.9
Extraordinary income (expense) net         306.0           203.8        50.2

Income before taxes                      1,840.9         1,906.7        (3.4)

Income taxes                              (454.0)         (508.4)      (10.7)

Net Income before minority               1,386.9         1,398.3        (0.8)
 interests

Minority interests                        (397.8)         (378.1)        5.2

Net Income                                 989.0         1,020.2        (3.0)

Outstanding shares (million)(4)          3,301.7         3,198.9         3.2

Net Income per share                        0.30            0.32        (6.3)


                                          April-June                       %
                                          2000           1999         Change

Operating revenues (1)                   6,830.3         5,458.6        25.1
Internal expand capitalized 
 in fixed assets (2)(3)                    219.6           246.7       (11.0)
Operating expenses                      (3,931.5)       (2,826.7)       39.1
 Supplies (3)                           (1,391.4)         (781.9)       78.0
 Personnel expenses                     (1,218.0)       (1,060.3)       14.9
 Subcontracts                           (1,242.8)         (900.5)       38.0
 Taxes                                     (79.3)          (84.0)       (5.6)
Other operating income                    (115.0)          (77.8)       47.8
 (expense) net (1)

EBITDA                                   3,003.4         2,800.8         7.2

Depreciation and amortization           (1,663.2)       (1,509.3)       10.2

Operating profit                         1,340.2         1,291.3         3.8
Profit from associated companies           (52.1)            4.1         c.s.
Financial income (expense) net            (393.2)         (318.7)       23.4
Amortization of goodwill                   (87.4)          (12.5)      597.2
Extraordinary income (expense) net         179.8           369.3       (51.3)

Income before taxes                        987.3         1,333.6       (26.0)

Income taxes                              (150.8)         (387.5)      (61.1)

Net Income before minority
 interests                                 836.5           946.1       (11.6)

Minority interests                        (193.5)         (183.8)        5.3

Net Income                                 643.0           762.3       (15.7)

Outstanding shares (million)(4)          3,301.7         3,198.9         3.2

Net Income per share                        0.19             0.24      (20.8)


(1) In March 99 figures, management fees have been reclassified from Other      
   Operating Income to Operating Revenues.
(2) Including work in process.
(3) In March 99 figures, 8.3 million euros from TSM have been reclassified
    from internal expenditure capitalized in fixed assets to Supplies.
(4) 0utstanding shares at the end of the period. Increases of 63,976,998 due
    to bonus Issues (1-for-50), 24,355,110 new shares from convertible bonds    
   and 14,477,109 new shares for Vigil and Ambit after the agreement to         
  acquire ATCO. The number of shares includes the split (3-for-1) of            
 23/07/99, with shares as of June 1999 being adjusted accordingly.


Telefonica. S.A.
Full Consolidation

Consolidated Balance Sheet
Unaudited figures
                                                  Euros In millions

                                             June              %
                                        2000      1999      Change

Subscribed shares not paid-in             3.1       3.4        (9.4)
Long-term assets                     52,031.2  47,490.1         9.6
Star  up expenses                       209.0     113.6        84.0
Intangible net assets                 7,294.2   6,371.1        14.5
Fixed net assets                     37,470,4  35,210.8         6.4
Investments                           7,057.6   5,794.6        21.8

Goodwill on consolidation             4,830.4   3,293.3        46.7
Deferred expenses                     1,176,0     802.3        46.6

Current assets                       11,603.4   9,057.4        28.1
Inventories                             811.9     437.2        85.7
Accounts receivable                   8,159.1   6,849.7        19.1
Short-term investments                1,753.6   1,366.2        28.4
Cash and banks                          459.8     131.1       250.6
Other                                   419.0     273.2        53.3

Assets = Liabilities                 69,644.1  60,646.5        14.8

Shareholders' equity                 15,637.6  13,907.8        12.4
Minority interests                   11,841.6  10,001.2        18.4
Deferred income                       1,072.5     709.6        51.1
Provisions for risks and expenses     6,746.9   7,253.1        (7.0)
Accrued taxes payable                 1,171.6     819.1        43.0
Long-term debt                       16,685.5  15,809.8         5.5
Short-term debt
 including current maturities         7,618.9   4,848.5        57.1
Interest payable                        409.0     337.0        21.3
Other creditors                       8,460.5   6,960,4        15.3

Financial Data
Consolidated net debt (1)            22,091.0  19,161.0        15.3            
Consolidated debt ratio (2)             42.6%     43.0%    (0.4 p.p.)

(1) Net debt: Long-term debt + Short-term debt including current maturities -   
    Short-term Investments - Cash and banks.
(2) Debt ratio: Net debt /(Shareholders' equity + Minority Interests +
    Deferred Income + Accrued taxes payable + Net debt)


Telefonica de Espana Group
Consolidated Income Statement
Unaudited figures

                                                          Euros in millions
                                            January - June               %
                                          2000              1999        Change
                  
Operating revenues                        5,138.7         5,046.6      1.8
 Telefonica de Espana                     4,785.5         4,874.6     (1.8)
 Others and eliminations                    353.2           172.0    105.4
Internal expend capitalized
 in fixed assets (1)                        126.3           173.5    (27.2)
Operating expenses                       (2,934.3)       (2,513.7)    16.7
Other operating income                       
 (expense) net                               19.4            13.3     45.6

EBITDA                                    2,350.1         2,719.8    (13.6)

Depreciation and amortization            (1,449.9)       (1,630.0)   (11.0)

Operating profit                            900.3         1,089.8    (17.4)

Profit from associated companies              0.3            (0.0)     c.s.
Financial income (expense) net             (263.9)         (314.4)   (16.1)
Amortization of goodwill                     (0.2)           (0.0)     n.s.
Extraordinary income
 (expense) net                              125.4          (301.3)     c.s.

Income before taxes                         761.9           474.2     60.7

Income taxes                               (208.4)         (111.0)    87.6

Net income before minority
 interests                                  553.4           363.2     52.4

Minority interests                            0.1             0.1     35.7

Net Income                                  553.5           363.3     52.4


                                                          Euros in millions
                                            April - June                   %
                                          2000              1999        Change
                  
Operating revenues                        2,634.5          2,578.3     2.2
 Telefonica de Espana                     2,431.9          2,466.2    (1.4)
 Others and eliminations                    202.6            112.1    80.7
Internal expend capitalized
 in fixed assets (1)                         68.5             89.2   (23.3)
Operating expenses                       (1,531.6)        (1,303.4)   17.5
Other operating income
 (expense) net                                9.7              6.7    44.9

EBITDA                                    1,181.1          1,370.9   (13.8)

Depreciation and amortization              (710.5)          (744.7)   (4.6)

Operating profit                            470.6            626.2   (24.8)

Profit from associated companies              0.3              0.3    (8.7)
Financial income (expense) net             (129.0)          (157.4)  (18.0)
Amortization of goodwill                     (0.1)            (0.0)    n.s.
Extraordinary income
 (expense) net                              238.1           (134.1)    c.s.

Income before taxes                         579.8            334.9    73.1

Income taxes                               (169.0)           (78.5)  115.4

Net income before minority
 interests                                  410.8            256.5    60.2

Minority interests                            0.2              0.0     n.s.

Net Income                                  411.1            256.5    60.3


(1) Including works in process
Note: Cabitel has been included on the accounts of Telefonica de Espana, for
both 1999 and 2000.


Telefonica de Espana Group
Telefonica de Espana (individual) operating revenues
Unaudited figures

                                                            Euros in millions
                                           January - June               %
                                          2000             1999       Change

Revenue derived from usage               2,932.1        3,114.7       (5.9)

Local                                      903.1          878.9        2.8
Provincial                                 289.0          318.6       (9.3)
Domestic long distance                     522.5          681.3      (23.3)
International long distance
 (outgoing) (1)                            264.3          218.0       21.3
Fixed to mobile                            738.7          650.9       13.5
Interconnection International
 (incoming)                                111.3          127.4      (12.6)
Interconnection National                   191.3          195.3       (2.0)
 Operators (1)
Others                                     (88.2)          44.3        c.s.

Monthly fee                              1,516.0        1,461.6        3.7
Connection fee                             144.5          121.2       19.2
Customer equipments                         69.4           51.8       33.8
Others (2)                                 123.5          125.4       (1.5)

Total operating revenues                 4,785.5        4,874.6       (1.8)


                                           April - June                  %
                                          2000             1999       Change

Revenue derived from usage               1,497.8        1,590.3       (5.8)

Local                                      467.4          460.5        1.5
Provincial                                 146.6          157.4       (6.9)
Domestic long distance                     267.7          337.5      (20.7)
International long distance
 (outgoing) (1)                            137.3          119.9       14.5
Fixed to mobile                            382.4          333.0       14.8
Interconnection International
 (incoming)                                 58.8           64.8       (9.4)
Interconnection National
 Operators (1)                             105.9          108.5       (2.5)
Others                                     (68.2)           8.5        c.s.

Monthly fee                                773.2          723.5        6.9
Connection fee                              78.4           64.5       21.5
Customer equipment                          19.6           18.6        5.7
Others (2)                                  62.9           69.3       (9.3)

Total operating revenues                 2,431.9        2,466.2       (1.4)


(1) Net of foreign participation
(2) Including special services, IRIS services and others


Telefonica de Espana Group
Datos Operativos
Unaudited figures


                                               June                    %
                                           2000           1999       Change

Lines installed
 (thousands) (1)                       17,088.6       16,898.1         1.1
Lines in service / 100
 inhabitants (2)                           49.0           46.9         4.4

Incoming Internat, Traffic
 (mill. minutes) (3)                    1,088          1,008           7.9
Outgoing Internat. Traffic
 (mill. minutes) (3)                    1,242            873          42.3


Usage growth (minute/line/day) (3)         22.2%           8.7%     13.5 p.p.
 Fixed networks outgoing traffic           17.3%           3.9%     13.4 p.p.
 Interconnection traffic with
  International Operators                   2.9%          12.6%     (9.7 p.p.)
 Interconnection traffic with
  Domestic Operators                       71.2%          92.3%    (21.1 p.p.)

Employees                                45,637         51,735       (11.8)
Lines / Employees (2)                     433.8          361.2        20.1

(1) Marketable basic telephone lines
(2) Basic telephony lines (including public telephones, Ibercom, ISDN and
    Connections lines with PABX)
(3) Estimated figures. Special service and mobile operators included

Telefonica Moviles Espana
Consolidated Statement of Income
Unaudited figures                                                          
                                                          Euros in millions
                                      January-June              % 
                                    2000            1999     Change

Operating revenues                 2,224.9        1,674.0      32.9             
Internal expend capitalized
 in fixed assets (1)                  23.9           25.7      (7.0)
Operating expenses                (1,400.3)      (1,079.1)     29.8 
Other operating income
 (expense) net                       (34.5)         (15.7)    119.8            

EBITDA                               814.1          604.9      34.6 

Depreciation and
 amortization                       (279.7)        (215.1)     30.0

Operating profit                     534.4          389.8      37.1 

Profit from associated
 companies                             0.0            0.0       n.s. 
Financial income
 (expense) net                       (19.0)         (24.9)    (23.8)           
Amortization of goodwill               0.0            0.0      n.s.
Extraordinary income
 (expense) net                         0.0           (3.2)     c.s.

Income before taxes                  515.5          361.7      42.5

Income taxes                        (170.3)        (122.3)     39.2 

Net Income before minority
 Interests                           345.1          239.4      44.2 

Minority Interests                     0.0            0.0       n.s.

Net Income                           345.1          239.4      44.2  



                                      April - June             % 
                                    2000            1999     Change

Operating revenues                 1,157.8         894.5       29.4
Internal expend capitalized
 in fixed assets (1)                  13.1          12.4        5.6
Operating expenses                  (727.8)       (571.3)      27.4
Other operating income               (17.2)         (8.4)     104.0
 (expense) net         

EBITDA                               426.0         372.2       30.2

Depreciation and
 amortization                       (148.1)       (110.7)      33.8

Operating profit                     277.8         216.4       28.4

Profit from associated
 companies                             0.0           0.0        n.s.
Financial income
 (expense) net                        (9.6)        (12.1)     (20.6)
Amortization of goodwill               0.0           0.0        n.s.
Extraordinary income
 (expense) net                        24.1           2.7      810.0

Income before taxes                  292.4         207.0       41.3

Income taxes                         (94.4)        (70.0)      34.9

Net Income before minority           197.9         137.0       44.5
 Interests

Minority Interests                     0.0           0.0        n.s.

Net Income                           197.9         137.0       44.5

   (1) Including work in process.



Telefonica Moviles Espana

Selected Operating Data
Unaudited figures

                                            June               %
                                       2000      1999        Change

Cellular subscribers              11,450,687     6,540,172     75.1
Contract                           4,089,914     3,257,443     25.6
 Prepaid                           7,360,773     3,282,729    124.2

Subscribers net adds
 in year to date (a)               2,398,340     1,645,908     45.7
Contract                             542,722       194,820    178.6
Prepaid                            1,855,618     1,451,088     27.9

TSM Penetration TM (b)                  28.6%        16.4%   12.3 p.p.
Total airtime minutes,
 in millions (a)                       9,563         5,728     67.0
Employees                              3,662         3,072     19.2

    (a) January-June accumulated data
    (b) Telefonica Servicios Moviles cellular lines / 100 inhabitants


Telefonica Internacional Group
Consolidated Income Statement (1)
Unaudited figures


                                                          Euros in millions
                             January - June     %       April - June        %
                              2000      1999            2000      1999  change

Income from Investments       216.3     172.3   25.5    78.6     98.9    (20.5)

 Equity Income                124.9      95.5   30.7    32.1     58.9    (45.4)
   CTC                        (14.5)     13.1   c.s.   (39.6)     9.0      c.s.
   COINTEL/TASA                52.1      48.3    7.8    26.6     22.1     20.6
   Telefonica del Peru         41.8      31.4   33.1    19.5     21.3     (8.4)
   Telesp                      47.8      15.5  207.9    30.3      7.5      n.s.
   CRT Celular                  7.4     (20.4)   c.s.    3.7     (3.8)     c.s.
   Telesp Celular
     Participacoes              1.8       3.8  (51.4)    1.0      1.9    (47.0)
   TeleSudeste Celular
     Participacoes              5.5       1.9  193.5     2.8      0.0      n.s.
   TeleLeste Celular
     Participacoes             (0.5)     (0.8) (38.6)   (0.1)    (0.9)   (85.9)
   Publiguias                  (4.9)      2.4    c.s.   (3.6)     2.4      c.s.
   CANTV                        1.4       4.8  (71.1)    1.5      0.8     98.4
   Others                     (13.0)     (4.4) 193.6    (9.9)    (1.4)     n.s.
 Management fees               91.4      76.8   19.0    46.5     40.0     16.1

Operating expenses           (333.7)   (232.4)  43.6  (170.2)  (125.6)    35.5

 Net financial expenses      (231.1)   (139.2)  66.1  (118.9)   (80.3)    48.1
 Goodwill amortization        (31.4)    (36.8) (14.7)  (15.7)   (20.1)   (22.0)
 Intangible assets
   amortization               (71.2)    (56.4)  26.2   (35.6)   (25.2)    41.3

Operating profit             (117.4)    (60.0)  95.6   (91.6)   (26.7)   242.9

Divestitures and others        34.3      70.7  (51.5)    2.4     59.6    (95.9)
Other Income (expense) net    (15.3)    (65.3) (76.7)   (2.3)  (115.0)   (98.0)
Taxes                         144.1     175.8  (18.0)   69.9    156.5    (55.3)

Net income                     45.7     121.2  (62.3)  (21.6)    74.4      c.s.

1) TISA holding income, incorporating the participation in all subsidiaries net 
   income following the economic participation


Telefonica Internacional Group
Operating Data

                                                     Figures in thousand

                         Lines in Service           Cellular Subscribers
                                 %      Proport.             %      Proport.    
                        Jun 00  Change  % Part.    Jun 00  Change   % Part (1)
                                00/99     (1)              00/99 

Managed Operators       18,158   17.9    4,844      7,613   68.1     2,228
CTC                      2,627   (0.5)   1,145      1,225   45.2       534
TASA                     4,402   13.3    1,198      1,371  105.3       373
Telefonica del Peru      1,719    5.0      688        810   36.9       324
 Telesp                  9,208   27.3    1,777
 CETERP                    179              25
 CRT Celular                                        1,167   65.9       428
 TeleSudeste Celular
     Part.                                          2,156   70.3       379
 TeleLeste Cellular
     Part.                                            589   52.6        53
 Telefonica
     El Salvador            22              10        195  182.5        86
 Telefonica Guatemala        2               1        100               51

Financial
  Participations         2,569   (0.9)     164      1,444   67.4        92

 CANTV                   2,569   (0.9)     164      1,444   67.4        92

Total                   20,727   15.2    5,008      9,056   68.0     2,321      


                                 Pay TV Customers
                                           % Change    Proport.
                                 June 00    00/99     % Part (1)

Managed Operators                   342        8.9        137
CTC                    
TASA                   
Telefonica del Peru                 342        8.9        137
 Telesp                
 CETERP                
 CRT Celular           
 TeleSudeste Celular
     Part.             
 TeleLeste Cellular
     Part.             
 Telefonica
     El Salvador       
 Telefonica Guatemala  

Financial
  Participations       

 CANTV                 

Total                               342         8.9        137

(1) Lines weighted by TISA's economic participation in each company
1999 and 2000 figures do not include CRT's lines, Cablevision subscribers
and Telesp Celular subscribers due to the transitory nature of the shareholding
in these companies.

Telefonica Internacional Group
Full Consolidation

Consolidated Income Statement (1)
Unaudited figures

                                                          Euros in millions
                               January-June     %      April-June        %
                             2000      1999    Change  2000      1999  Change 

Operating revenues         6,095.6    4,445.6   37.1  3,108.2  2,275.1   36.6
Internal expend
 capitalized in
 fixed assets (2)            178.8      122.8   45.6     81.5     71.5   14.1
Operating expenses        (3,292.2)  (2,251.1)  46.2 (1,625.1)(1,198.5)  35.6
Other operating income
 (expense) net              (128.0)    (129.6)  (1.2)   (87.6)   (50.8)  72.5

EBITDA                     2,854.2    2,187.7   30.5  1,477.0  1,097.3   34.6

Depreciation and
 amortization             (1,506.4)  (1,107.2)  36.1   (778.8)  (638.3)  22.0

Operating profit           1,347.8    1,080.5   24.7    698.2    459.0   52.1

Profit from associated
 companies                     4.5       20.4  (77.7)     4.7      9.6  (51.3)
Financial income
 (expense) net              (604.2)    (439.5)  37.5   (342.4)  (166.4) 105.7
Amortization of goodwill     (58.8)     (54.1)   8.8    (29.4)     3.2    c.s.
Extraordinary income
 (expense) net               (49.8)    (109.9) (54.7)   (50.2)   (92.4) (45.7)

Income before taxes          639.6      497.5   28.6    280.9    212.9   31.9

Income taxes                (117.6)      17.4    c.s.   (59.7)    53.3    c.s.

Net income before
 minority interests          522.0      514.9    1.4    221.3    266.3  (16.9)

Minority interests          (476.3)    (393.7)  21.0   (242.8)  (191.9)  26.5

Net Income                    45.7      121.2  (62.3)   (21.6)    74.4    c.s.

(1) TASA, CTC, Telefonica del Peru, Publiguias, TLD, Telesp, Telesudeste
Celular Participacoes and CRT Celular fully consolidated; other Latin
American subsidiaries consolidated by the equity method. 
(2) Including work in process


Telefonica Data Group
Consolidated Income Statement
Unaudited figures

                                                          Euros in millions
                               January-June     %      April-June        %
                             2000      1999    Change  2000      1999  Change 

Operating revenues             338.6    288.3    17.4    179.1    164.2   9.1
Internal expend capitalized
 in fixed assets (1)             0.0      0.4     n.s.     0.0     (2.1)  c.s.
Operating expenses            (297.0)  (234.7)   26.5   (160.0)  (129.0) 24.1
Other operating income
 (expense) net                  (0.3)    (0.3)   (5.2)    (0.3)    (0.1)  n.s.

EBITDA                          41.2     53.6   (23.1)    18.8     33.1  (43.3)

Depreciation and
 amortization                  (29.7)   (33.0)   (9.8)   (14.4)   (16.1) (10.7)

Operating profit                11.5     20.7   (44.4)     4.4     17.0  (74.2)

Profit from associated
 companies                      (1.0)     0.5     c.s.    (2.3)     0.6    c.s.
Financial income (expense) net  (2.2)    (1.7)   24.4     (1.5)    (1.0) (54.8)
Amortization of goodwill        (2.8)    (0.5)  466.7     (1.5)    (0.4)   n.s.
Extraordinary income
 (expense) net                  (0.4)    (0.0)    n.s.    (0.2)    (0.0)   n.s.

Income before taxes              5.2     18.9   (72.6)    (1.2)    16.1    c.s.

Income taxes                    (1.0)    (6.5)  (84.6)     3.3     (5.5)   c.s.

Net Income before
 minority Interests              4.2     12.4   (66.3)     2.1     10.6  (80.3)

Minority interests               0.0      0.0     n.s.     0.0      0.0    n.s.

Net Income                       4.2     12.4   (65.9)     2.1     10.6  (79.9)

(1) Including work in process
Note: 1999 figures have been re-drafted to include ETI and Acea Telecom, which
were previously reported under Telefonica Intercontinental


Telefonica Data Group
Operating Data
                                           June                 %
                                        2000      1999       Change

Connections (dedicated ports)        157,011   108,907         44.2
IP Networks (switched ports)         140,456    34,740        304.3
Employees                              1,048       636         64.8


Telefonica Media Group
Consolidated Income Statement (1)
Unaudited figures

                                                            Euros in millions
                               January-June     %      April-June        %
                             2000      1999    Change  2000      1999  Change 

Profit from associated
 companies                    (61.1)    (30.6)   99.8   (55.0)   (12.2)  349.0

 Antena 3                      33.3      25.1    32.4    22.3     19.1    17.0
 Via Digital                  (64.4)    (39.7)  (64.6)  (30.1)   (25.7)   16.8
 Telefonica Servicios
   Audiovisuales                3.0       3.1    (2.7)    1.7      1.8    (4.0)
 Others                       (31.9)    (19.0)   67.9   (48.9)    (7.4)  560.8

Operating expenses            (26.5)    (22.7)   16.9   (14.6)   (12.5)   17.2

 Net financial expenses        (0.5)    (11.2)  (95.9)   (0.8)    (6.3)  (87.8)
 Goodwill amortization        (26.0)    (11.5)  127.1   (13.8)    (6.2)  124.3

Operating profit              (87.5)    (53.2)   64.5   (69.6)   (24.7)  181.6

Divestitures and others         0.0       0.0     n.s.    0.0      0.0     n.s.
Other Income (expense) net    (18.2)     (3.9)  368.6    (1.5)    (2.5)  (37.0)
Taxes                          18.2      17.1     6.4     9.9      5.6    77.1

Net Income                    (87.6)    (40.0)  118.8   (61.2)   (21.6)  183.9

(1) Consolidated by equity method.

Terra Networks Group
Consolidated Income Statement
Unaudited figures

                                                           Euros in millions
                               January-June     %      April-June        %
                             2000      1999    Change  2000      1999  Change 

Operating revenues             80.6     3.0    n.s.      44.9     0.8   n.s.
Internal expend capitalized
 in fixed assets (1)            1.0     2.5   (58.8)     (0.0)    2.3   c.s.
Operating expenses           (234.1)  (16.6)   n.s.    (139.4)  (12.6)  n.s.
Other operating income
 (expense) net                 (1.5)    0.2    c.s.       1.5     0.2   n.s.

EBITDA                       (153.9)  (10.8)   n.s.     (93.0)   (9.3)  n.s.

Depreciation and
 amortization                 (26.9)   (0.7)   n.s.     (15.3)   (0.4)  n.s.

Operating profit             (180.8)  (11.5)   n.s.    (108.3)   (9.8)  n.s.

Profit from associated
 companies                     (4.8)    0.0    n.s.      (4.7)    0.0   n.s.
Financial income
 (expense) net                  0.3     0.1    n.s.      (3.3)    0.0   n.s.
Amortization of goodwill      (57.8)   (0.1)   n.s.     (30.6)   (0.1)  n.s.
Extraordinary Income
 (expense) net                 (0.5)    0.3    n.s.      (0.2)    0.3   c.s.

Income before taxes          (243.5)  (11.2)   n.s     (147.1)   (9.5)  n.s.

Income taxes                   76.2     3.7    n.s.      51.0     3.1   n.s.

Net Income before
 minority interests          (167.3)   (7.5)   n.s.     (96.1)   (6.4)  n.s.

Minority interests              1.7     0.0    n.s.       0.5     0.0   n.s.

Net Income                   (165.6)   (7.5)   n.s.     (95.6)   (6.4)  n.s.


(1) Including work in process.


Terra Networks Group
Operating Data

                                      June 2000       June 1999

ISP Customers, in thousands             2,659            485
Page views, in millions                 1,032            251
Visits per month, in millions              86             17



TPI - Paginas Amarillas Group
Consolidated Income Statement
Unaudited figures

                                                           Euros in millions
                               January-June     %      April-June        %
                             2000      1999    Change  2000      1999  Change 

Operating revenues            107.3     95.7    12.2    94.6     80.5    17.5
Internal expend capitalized
 in fixed assets               17.7     18.2    (2.8)    0.0      2.1     c.s.
Operating expenses            (85.6)   (82.4)    3.9   (58.0)   (54.3)    7.0
Other operating income
 (expense) net                 (4.1)    (1.8)  126.8    (3.9)    (1.7)  128.3

EBITDA                         35.3     29.8    18.5    32.7     26.6    23.1

Depreciation and
 amortization                  (4.6)    (3.0)   52.5    (2.5)    (1.6)   58.0

Operating profit               30.6     26.7    14.6    30.3     25.0    20.9

Profit from associated
 companies                      0.0      0.0     n.s.    0.0      0.0     n.s.
Financial income (expense) net  0.0     (0.1)    c.s.   (0.0)    (0.1)    c.s.
Amortization of goodwill        0.0      0.0     n.s.    0.0      0.0     n.s.
Extraordinary Income
 (expense) net                  0.2     22.5     n.s.    0.2     (6.0)    c.s.

Income before taxes            30.9     49.1   (37.1)   30.4     19.0    60.2

Income taxes                  (10.8)   (13.5)  (19.8)  (10.6)    (6.6)   61.0

Net Income before
 minority interests            20.1     35.6   (43.6)   19.8     12.4    60.0

Minority Interests              0.0      0.0     n.s.    0.0      0.0     n.s.

Net income                     20.1     35.6   (43.6)   19.8     12.4    60.0


TPI - Paginas Amarillas Group
Selected  Operating Data
Unaudited figures
                                              Euros in millions
                                        June               %
                                      2000      1999      Change

Books(published)
  Paginas Amarillas (Yellow pages)     23        21         9.5
  Paginas Blancas (White pages)        10        12       (16.7)

Advertising revenues
  Paginas Amarillas (Yellow pages)   78.0      52.0        50.0
  Paginas Blancas (White pages)      23.9      42.4       (43.6)
  Paginas Amarillas On-Line           3.4       0.6         n.s.
  Paginas Amarillas Habladas          1.5       0.3         n.s.


APPENDIX

Telefonica, S.A.
Consolidated Balance Sheet
Unaudited figures

                                                          Euros in millions
                                               June
                               Equity              
                            Method (1)   % Change      Impact of TISA's
                                 2000    June 00/99    subsidiaries (2) 2000

Subscribed shares not
 paid-in                          3.1         (9.4)              0.0
Long term assets             32,306.3          5.0          19,724.9

  Star up expenses              209.0        124.3               0.0
  Intangible net assets       6,362.6          5.7             931.6
  Fixed net assets           15,952.5         (6.6)         21,517.9
  Investments                 9,782.2         28.7          (2,724.6)

Goodwill on consolidation     4,106.7         51.5             723.7
Deferred expenses               968.6         59.6             207.4
Current assets                5,631.6         18.5           5,971.8

  Inventories                   490.8         88.9             321.1
  Accounts receivable         3,670.5          4.1           4,488.6
  Short term investments        988.9         21.3             764.7
  Cash and banks                256.2        566.7             203.6
  Others                        225.2         97.4             193.8

Assets = Liabilities         43,016.3         10.7          26,627.8

Shareholders' equity         15,637.6         12.4               0.0
Minority Interests              604.4          n.s.         11,237.2
Deferred income               1,070.5         51.7               2.0
Provisions for risks
 and expenses                 5,504.8        (11.1)          1,242.1
Accrued taxes payable           611.9         55.7             559.7
Long term debt               10,186.2          0.7           6,497.3
Short term debt including
 current maturities           4,667.7         44.5           2,951.2
Interest payable                204.0         (1.9)            205.0
Other creditors               4,527.2         10.9           3,933.3

Consolidated net debt (4)    13,610.8          8.9           8,480.2
Consolidated debt ratio (5)     43.2%    (2.2 p.p)             41.8%


                                             Total           % Change
                                          Group (3)        June 00/99

Subscribed share not                         
 pad-in                                        3.1              (9.4)
Long term assets                          52,031.2               9.6

  Start up expenses                          209.0              84.0
  Intangible net assets                    7,294.2              14.5
  Fixed net assets                        37,470.4               6.4
  Investments                              7,057.6              21.8

Goodwill on consolidation                  4,830.4              46.7
Deferred expenses                          1,176.0              46.6
Current assets                            11,603.5              28.1

  Inventories                                811.9              85.7
  Accounts receivable                      6,159.1              19.1
  Short term investments                   1,753.6              28.4
  Cash and banks                             459.8             250.6
  Others                                     419.1              53.3

Assets = Liabilities                      69,644.1              14.8

Shareholders' equity                      15,637.6              12.4
Minority Interests                        11,841.6              18.4
Deferred income                            1,072.5              51.1
Provisions for risks
 and expenses                              6,746.9              (7.0)
Accrued taxes payable                      1,171.6              43.0
Long term debt                            16,685.5               5.5
Short term debt including
 current maturities                        7,618.9              57.1
Interest payable                             409.0              21.3
Other creditors                            8,460.5              15.3

Consolidated net debt (4)                 22,091.0              15.3
Consolidated debt ratio (5)                  42.6%          (0.4 p.p)

(1) Telefonica Internacional's operating subsidiaries consolidated by
    the equity method.
(2) Impact of TASA, CTC, Telefonica del Peru, Publiguias, TLD, Telesp,
    Telesudeste Celular Participacoes and CRT Celular full consolidation. 
(3) Telefonica S.A. including TASA, CTC, Telefonica del Peru, Publiguias,
    TLD, Telesp, Telesudeste Celular Participacoes and CRT Celular fully
    consolidated; other Latinamerican subsidiaries consolidated by the
    equity method. 
(4) Net debt: Long term debt + Short term debt including current maturities -   
    Short term investments - Cash and banks. 
(5) Debt ratio: Net debt / (shareholders's equity + minority interest +         
   Deferred Income + Accrued taxes payable + Net debt).


Telefonica, S.A
Consolidated Income Statement
Unaudited figures     

                                                       Euros in millions        
                                                                
                                            January - June
                               Equity    % Change   Impact of TISA's  % Change
                            Method (1) June 00/99   subsidiaries (2) June 00/99
                                 2000                    2000

Operating revenues              7,448.4     14.9       5,829.6          37.2
Internal expend capitalized
 in fixed assets (4)              273.3     (9.8)        167.4          15.5
Operating expenses             (4,612.3)    40.0      (3,097.8)         43.6
  Supplies                     (1,547.2)    56.7      (1,093.6)        143.9
  Personnel expenses           (1,571.1)    13.8        (814.0)         16.0
  Subcontracts                 (1,382.1)    69.1      (1,084.3)         14.2
  Taxes                          (111.8)     3.1        (105.9)         86.0
Other operating income            (57.5)   (36.3)       (128.0)         13.8
 (expense) net       

EBITDA                          3,051.9    (10.3)      2,771.3          30.5
       
Depreciation and
 amortization                  (1,815.3)    (4.5)     (1,483.9)         37.0

Operating profit                1,236.6    (17.6)      1,287.4          23.7

Profit from associated
 companies                         50.3    (14.1)       (103.7)         74.5
Financial Income
 (expense) net                   (392.0)    21.4        (380.1)        (12.2)
Amortization of goodwill         (207.4)    72.8          43.8          14.7
Extraordinary income
 (expense) net                    448.9     74.0        (142.9)        162.9

Income before taxes             1,136.4    (17.3)        704.5          32.3

Income taxes                     (204.2)   (42.2)       (249.8)         61.1

Net Income before                 932.2     (8.7)        454.7          20.4
 minority Interests        

Minority interests                 56.8      c.s.       (454.7)         20.4
                    
Net income                        989.0     (3.0)          0.0             -

 Outstanding shares
  (millions) (5)                3,301.7      3.2       

Net Income per share               0.30     (6.1)      


                                           Total       % Change
                                         Group (3)     June 00/99

Operating revenues                       13,278.0            23.7
Internal expend capitalized
 in fixed assets (4)                        440.7            (1.6)
Operating expenses                       (7,710.1)           41.5
  Supplies                               (2,640.8)           83.9
  Personnel expenses                     (2,385.1)           14.6
  Subcontracts                           (2,466.5)           39.6
  Taxes                                    (217.7)           31.7
Other operating income                     (185.5)           (8.5)
 (expense) net       

EBITDA                                    5,823.2             5.4
       
Depreciation and
 amortization                            (3,299.2)           10.5

Operating profit                          2,524.0            (0.7)

Profit from associated
 companies                                  (53.4)            n.s.
Financial Income
 (expense) net                             (772.0)            2.2
Amortization of goodwill                   (163.6)           99.9
Extraordinary income
 (expense) net                              306.0            50.2

Income before taxes                       1,840.9            (3.5)

Income taxes                               (454.0)          (10.7)

Net Income before
 minority Interests                       1,386.9            (0.8)

Minority interests                         (397.8)            5.2
                    
Net income                                  989.0            (3.0)

 Outstanding shares
  (millions) (5)                          3,301.7             3.2

Net Income per share                         0.30            (6.1)

(1) Telefonica Internacional's operating subsidiaries consolidated by the
    equity method. 
(2) Impact of TASA, CTC, Telefonica del Peru, Publiguias, TLD, Telesp,          
   Telesudeste Celular Participacoes and CRT Celular full consolidation. 
(3) Telefonica, SA. including TASA, CTC, Telefonica del Peru, Publiguias, TLD,  
   Telesp, Telesudeste Celular Participacoes and CRT Celular fully              
  consolidated: Other Latinamerican subsidiaries consolidated by the equity     
 method.
(4) Including work in process.
(5) Outstanding shares at the end of the period. Increases of 63,976,998 due to 
    bonus issues (1-for-60), 24,355,110 new shares from convertible bonds and
    14,477,109 new shares for Vigil and Ambit  after the agreement to acquire
    ATCO. The number of shares includes the spilt (3-for-1) of 23/07/99, with
    shares as of June 1999 being adjusted accordingly.