Interim Results-Part II

Telefonica SA
29 July 2004

RESULTS BY BUSINESS LINES

Other businesses

DIRECTORIES BUSINESS

During the first half of 2004 the TPI Group's operating revenues increased by
12.7% to 215.7 million euros, despite the negative performance of local
currencies against the euro in Latin America, in particular the Peruvian sol.
The Group's EBITDA amounted to 59.3 million euros, 39.4% higher than the figure
for the same period of 2003. These results are explained by:

•       The progress made, within TPI Espana, by both the advertising revenues,
which rose by 11.1% to 140.7 million euros, and the telephony traffic business
line, whose revenues soared by more than three times fold those of the previous
year, reaching 20.6 million euros.

•       The good performance of advertising revenues at the Chilean subsidiary
(Publiguias), which in local currency rose by 7.5%.

•       The increase in total revenues at TPI Peru of 5.8% in local currency,
helped by the publication of the Lima book, and the significant improvement in
EBITDA, which rose by 35.1% in local currency, due to the efforts deployed in
reducing bad debt provisions.

•       The decrease in total revenues of TPI Brazil of 19.5% in local currency,
due to a more restrictive contract policy aiming at improving bad debt levels.

Once again it is important to remember that the seasonal nature of revenues, due
to accounting criteria in place once each guide was actually published, make it
so that the quarterly results are not comparable or standardized, nor can they
be extrapolated to year end. Likewise, the positive evolution of the company
allows to maintain the initial forecasts of its main financial aggregates up to
year-end announced during the first quarter, of growth at constant exchange
rates in revenues (3-5%) and EBITDA (9-11%).

TPI Espana, that includes the revenues of Goodman Business Press, contributed
79% of the Group's revenues, and made a positive contribution to the Group's
EBITDA of 54.8 million euros (92.4% of total). TPI Espana revenues rose by 19.7%
to 170.4 million euros, triggered mainly by four main factors:

•       The organic growth, like for like, of 4.3% and 7.9% experienced by the
Yellow Pages directories and the White Pages directories, respectively.

•       The publication of an additional Yellow Pages directory in comparison
with the same period in the previous year (41 directories vs. 40 directories in
H103) vs. no changes in White Pages (26 directories in both periods).

•       The variations in the publication calendar of guides.

•       And the strong performance, within TPI Spain, achieved by the telephony
service 11888, whose revenues climbed to 20.6 million euros vs. 6.6 million
euros in the same period of 2003 (+214.1%).

Latin America contributed the remaining 21% of revenues and 8% of EBITDA, with
TPI Peru being the biggest Latin American contributor to both revenues and
EBITDA thanks to the publication of the Lima directory in January 2004. During
this period, TPI Peru obtained revenues of 26.3 million euros and contributed
10.5 million euros to the Group's consolidated EBITDA.

In turn, the directories business of the Telefonica Group, which includes the
Argentinean company Telinver, recorded during the first half of 2004 an increase
in total revenues of 12.5% up to 220,2 million euros compared with the first
half of 2003, due primarily to an improvement in the economic situation in
Argentina. EBITDA amounted 59.9 million euros, representing a year on year
increase of 39.9%.


TPI - PAGINAS AMARILLAS GROUP
SELECTED OPERATING DATA IN SPAIN
 Unaudited figures
                                                                          January - June
                                                                    2004               2003           % Chg
Books Published
Yellow Pages*                                                         41                 40
White Pages                                                           26                 26

 (Euros in  millions)
Revenue Breakdown (1)                                              169.3              141.3            19.9
Advertising                                                        140.7              126.6            11.1
   Publishing                                                      122.3              112.1             9.1
      Yellow Pages                                                  95.2               87.4             8.9
      White Pages                                                   27.2               24.7            10.0
      Building Directory (2)
      Europages (2)
   Internet                                                         15.0               12.1            23.9
   Operator Assisted Yellow Pages                                    2.2                1.9            10.5
   Others                                                            1.3                0.5           150.4
Telephony Traffic                                                   20.6                6.6           214.1
Operator                                                             7.3                6.9             5.9
Others                                                               0.7                1.2           (40.0)

*Includes a breakdown by residential/business services and pocket guides.
(1) TPI Espana includes Telefonica Publicidad e Informacion S.A. and 11888 Servicio de Consulta Telefonica
S.A.U.  results. Goodman Business Press is not included.
(2) Both will be published from next quarter onwards.


TPI - PAGINAS AMARILLAS GROUP
CONSOLIDATED INCOME STATEMENT
 Unaudited figures (Euros in millions)
                                            January - June                                        April - June
                                         2004       2003    % Chg                             2004       2003    % Chg
Operating revenues                      215.7      191.5     12.7                            138.3      125.1     10.6
Operating expenses                     (156.4)    (149.0)     5.0                            (96.9)     (93.3)     3.8
EBITDA                                   59.3       42.5     39.4                             41.4       31.8     30.5
Depreciation and amortization           (10.5)     (12.4)   (15.7)                            (5.5)      (6.2)   (11.5)
Operating profit                         48.8       30.1     62.2                             36.0       25.6     40.7
Profit from associated companies         (0.4)      (0.7)   (49.9)                            (0.1)      (0.2)   (64.4)
Financial net income (expense)           (1.9)      (1.7)     7.4                             (1.6)      (0.7)   127.0
Amortization of goodwill                 (2.1)      (1.5)    40.2                             (1.3)      (0.8)    70.4
Consolidation adjustments                 0.0        0.6     n.s.                              0.0        0.0     n.s.
Extraordinary net income (expense)       (0.3)      (0.1)   179.6                             (0.4)       0.3     c.s.
Income before taxes                      44.2       26.6     66.1                             32.6       24.3     34.4
Income taxes                            (17.0)     (11.5)    47.2                            (12.8)     (10.8)    19.0
Net income before minority               27.2       15.1     80.6                             19.8       13.5     46.7
interests
Minority interests                        0.5        5.6    (90.7)                             0.1        3.9    (98.4)
Net income                               27.7       20.7     34.3                             19.9       17.4     14.4


DIRECTORIES BUSINESS
CONSOLIDATED INCOME STATEMENT
 Unaudited figures (Euros in millions)
                                            January - June                                    April - June
                                         2004       2003    % Chg                         2004       2003    % Chg
Operating revenues                      220.2      195.7     12.5                        142.3      129.0     10.3
Internal expend capitalized in            0.0        0.0     n.s.                          0.0        0.0     n.s.
fixed assets (1)
Operating expenses                     (148.8)    (141.9)     4.9                        (91.7)     (89.6)     2.3
Other net operating income              (11.5)     (10.9)     5.0                         (8.0)      (6.6)    21.9
(expense)
EBITDA                                   59.9       42.8     39.9                         42.6       32.8     29.8
Depreciation and amortization           (10.8)     (12.9)   (15.9)                        (5.6)      (6.4)   (11.8)
Operating profit                         49.1       30.0     63.9                         36.9       26.4     39.8
Profit from associated companies         (0.4)      (0.7)   (49.9)                        (0.1)      (0.2)   (64.4)
Financial net income (expense)           (3.3)      (4.3)   (22.5)                        (2.2)      (1.8)    19.7
Amortization of goodwill                 (2.1)      (1.0)   123.9                         (1.3)      (0.7)    72.9
Extraordinary net income (expense)       (0.4)      (0.4)    10.5                         (0.5)      (0.0)    n.s.
Income before taxes                      42.9       23.7     81.3                         32.8       23.7     38.8
Income taxes                            (17.0)     (11.5)    47.2                        (12.8)     (10.8)    19.0
Net income before minority               25.9       12.1    113.7                         20.0       12.9     55.4
interests
Minority interests                        0.6        5.5    (89.9)                         0.1        3.8    (97.9)
Net income                               26.5       17.6     50.2                         20.1       16.7     20.2

Note: Telefonica Directories Business includes Telinver (Argentina).
(1) Including work in process.

RESULTS BY BUSINESS LINES

Other businesses

TERRA LYCOS GROUP

In the first half of 2004, the operating revenues obtained by Terra Lycos
amounted 273.9 million euros, representing an increase of 8.3% over the same
period of the previous year. The strategic Alliance with Telefonica has
continued to progress during the second quarter, reaching an accumulated figure
of 59.2 million euros in June compared with 43.5 million euros obtained in the
same period of 2003.

The revenues breakdown by business line until June, which remained stable
compared with the first quarter, was as follows: 42.5% Access revenues (+11.9%
y-o-y), 25.0% Advertising and Online revenues (+14.6% y-o-y), 22.4%
Communication Services revenues (-1.0% y-o-y) and the remaining 10.1% Corporate
Services revenues (+2.4% y-o-y).

Regarding the geographical revenues breakdown, Spain, Brazil and USA
subsidiaries weighted 89% of total revenues, with a significant contribution
from the strategic Alliance with Telefonica both in Spain and Brazil.

During this semester, Spain experienced a year over year revenues growth of
28.9% to 115.5 million euros, representing 42.0% of total revenues (up from
35.3% of total revenues in the same period of 2003), mainly due to the growth
registered in both access (+16.9%) and CSP/Portal (+47.0%) revenues. Particular
mention should be made for the new product launched in June 'Pack Terra Disney'
that includes broadband internet access (ADSL) plus a package of exclusive
broadband Disney contents within a fully secure environment.

Brazil revenues stood at 70.2 million revenues, a decrease of 2.4% over the
first half of 2003, representing 25.5% of total revenues (down 2.8 percentage
points y-o-y). Terra Brazil, with almost 2.8 million clients, remains the
biggest paying access provider in the country with 1.2 million subscribers,
highlighting its leadership in the broadband market, with 538,889 connections.
Moreover, important companies such as VISA, Johnson & Johnson, Nike and Dell are
among the main advertisers within Terra Brazil's client portfolio.

USA revenues, including those of One Travel, amounted 58.1 million euros (+1.5%
y-o-y), representing 21.1% of total revenues (1.4 p.p less than in the same
period of 2003). Most of the revenues obtained this semester came from
advertising revenues.

The remaining countries and businesses weight 11% of total group's revenues,
highlighting the contribution of Mexico and Chile, which both account for 10%.

EBITDA for this first half of 2004 stood at 2.4 million euros, representing an
EBITDA margin of 0.9% (vs. -14,5% in June 2003), compared with the negative 36.6
million euros reached in the first quarter of 2003. The Alliance with Telefonica
registered coverage of the value committed for the whole year (78.5 million
euros) of 43%.

Regarding its client base, Terra Lycos reached this first half of 2004 5.7
million paying subscribers (+58.6% over the same period of 2003). Access clients
account 1.8 million at the end of June 2004, of which 841,651 are broadband
clients (+76.3% y-o-y).

It should be mentioned that 68.0% of the company's total paying customers had
signed up for OBP products, consisting of either communication or portal
products (CSPs or OBPs). These clients have increased 86.5% in the last twelve
months, largely due to the new Alliance with Telefonica.

At the end of the first half of 2004, Terra Lycos had a cash position of 1,615
million euros.

Moreover, during the Ordinary General Meeting of Shareholders held on 22th June
2004, were approved, among other matters, the reduction of the stock capital by
amortization of own shares and the payment of a dividend against the paid in
capital reserve.

The share capital will be reduced by an amount of 53,052,804 euros, aiming at
amortizing 26,526,402 treasury stock of two euros of nominal value each share.
These 26,526,402 shares amortized were acquired by Citibank and maintained in
the treasury stock in order to give coverage to the stock-options plan of Lycos
Inc.

As a consequence of this share capital reduction, the share capital of the
company will be 1,150 million euros (574.9 million shares with a nominal value
of two euros each), at present fully subscribed and paid.

The dividend will be paid on July the 30th of 2004, in cash, for a fixed amount
of two euros per each of the shares in circulation, with a total maximum amount
of 1,136 million euros.


TERRA LYCOS GROUP
SELECTED OPERATING DATA
 Unaudited figures (Thousands)
                                                                                June
                                                                     2004               2003           % Chg
Total Pay Subscribers                                             5,726.1            3,610.1            58.6
Access                                                            1,833.2            1,522.3            20.4
   Narrowband                                                       991.6            1,044.9            (5.1)
   Broadband                                                        841.7              477.4            76.3
OBP (CSP/Portal)                                                  3,892.9            2,087.8            86.5
Broadband Access Subscribers by Country                             841.7              477.4            76.3
   Spain                                                            191.8              135.3            41.8
   Latin America                                                    649.9              342.2            89.9
Employees (units)                                                   2,043              2,285           (10.6)


TERRA LYCOS GROUP
CONSOLIDATED INCOME STATEMENT
 Unaudited figures (Euros in millions)
                                            January - June                                     April - June
                                         2004       2003    % Chg                          2004       2003    % Chg
Operating revenues                      273.9      252.8      8.3                         140.2      138.3      1.4
Internal expend capitalized in            0.5        0.6    (10.8)                          0.3        0.4    (14.5)
fixed assets (1)
Operating expenses                     (268.1)    (286.2)    (6.3)                       (136.9)    (154.1)   (11.1)
Other net operating income               (4.0)      (3.8)     4.3                          (1.9)      (1.7)    12.5
(expense)
EBITDA                                    2.4      (36.6)    c.s.                           1.7      (17.1)    c.s.
Depreciation and amortization           (38.7)     (37.5)     3.3                         (16.9)     (18.0)    (6.5)
Operating profit                        (36.4)     (74.1)   (50.9)                        (15.2)     (35.1)   (56.8)
Profit from associated companies         (8.1)      (8.6)    (6.5)                         (3.4)       2.6     c.s.
Financial net income (expense)           17.4       21.4    (18.7)                          5.4        9.1    (40.7)
Amortization of goodwill                (39.4)     (42.2)    (6.6)                        (19.7)     (22.0)   (10.6)
Extraordinary net income (expense)      (24.4)       5.8     c.s.                          (4.8)       3.3     c.s.
Income before taxes                     (90.8)     (97.7)    (7.1)                        (37.7)     (42.2)   (10.6)
Income taxes                             19.0       (0.2)    c.s.                           8.4       (0.0)    c.s.
Net income before minority              (71.8)     (97.9)   (26.7)                        (29.3)     (42.2)   (30.6)
interests
Minority interests                        2.5        0.0     n.s.                           0.4       (0.0)    c.s.
Net income                              (69.3)     (97.9)   (29.2)                        (28.9)     (42.2)   (31.5)

(1) Including work in process.


RESULTS BY BUSINESS LINES

Other businesses

ATENTO GROUP

In the second quarter of 2004, the positive trend shown during the first quarter
continued, characterized by Atento Group's increase in commercial activity and
services consolidation in its main clients. It is important to highlight the
agreements reached with VIVO and Unibanco Brazil and the signature of new
contracts (e.g. Prefetura de Sao Paolo). In Spain and Mexico, the agreement with
BBVA continued to progress satisfactorily. Likewise, in Mexico, new clients such
as Amex, Scotiabank Inverlat, Nafin and Infonavit were captured and new services
launched with BBVA and Nokia. Atento Puerto Rico consolidated the contracts
signed during the first quarter with AT&T Wireless, ACE Insurance and Banco
Santander. Atento Chile was able to get new clients outside the Telefonica
Group, such as Correos de Chile, Vespucio Norte Express,  Americatel and new
services with BBVA. In Venezuela, a new contract was signed with Empresas Polar.
In Atento Colombia, an agreement with DHL has been closed.

From a financial point of view, Atento Group operating revenues for the first
half of 2004 amounted to 279,4 million euros, 15.5% more than in the same period
of the previous year. This evolution is explained by the greater contribution of
Atento Spain, which revenues grew year on year by 20,8%, and of Atento Brazil,
which revenues grew year on year by 17.2% due to commercial achievements over
the period. Excluding the negative exchange rate effect, revenues would have
increased by 19.6%. It is important to highlight that, during the second quarter
of 2004, y-o-y revenues growth rate accelerated versus the first quarter of the
year (+21.7% vs. 9.4%).

In terms of revenues structure, the contribution of clients outside the
Telefonica Group continues its upward trend, reaching 41% of revenues as of June
2004 compared with 38% in December 2003, as a result of the aforementioned
commercial progress. Regarding the evolution by countries, Spain and Brazil
continue to be the highest contributors of revenues (73.0% of the total), 2.1
percentage points more than their contribution at the end of june 2003. Spain's
contribution increased 1.7 percentage points due to higher services given to
BBVA, while Brazil's contribution rose 0.4 percentage points. Regarding the rest
of the countries, Mexico increased its contribution to 6.5% (4.9% a year ago),
as well as Argentina (2.5% vs. 1.7%) and Puerto Rico (2.7% vs. 1.8%).

Operating expenses totaled 240.1 million euros for the period January-June 2004,
10.1% higher than the first six months of 2003 (+14.1% in constant euros). This
variation can be explained by the year on year increase in personnel expenses
(+12.6%) related to a higher activity.

As a result of this evolution of revenues and expenses, EBITDA for the first
half of the year stood at 40.9 million euros, 61.3% higher than the figure for
the same period of the previous year (71.6% excluding the forex effect). During
the second quarter, the year on year increase of EBITDA reached 83.8%. EBITDA
margin rose to 14.6%, 4.2 percentage points above that registered twelve months
ago. During the period April-June 2004, EBITDA margin stood at 14,8% (+5.0
percentage points vs. 2Q03). This margin places the Company among the most
profitable companies in the 'Contact Center' sector.

The operating profit for the first half amounted to 21.4 million euros with a
significant improvement compared with the 2.1 million euros loss registered
during the same period in 2003, mainly due to the increase in EBITDA and the
29.4% y-o-y decrease in depreciation as a result of the degree of maturity
achieved in operations.

Net income for the first half amounted to 2.2 million euros, as compared with a
net loss of 14.9 million euros in the first six months of 2003. It is important
to note this is the first semester the Company has recorded a positive net
result.

At operating level, Atento Group had 27,580 positions in place in June 2004,
compared with 25,700 positions in December 2003 and 24,640 positions in June
2003. The average number of occupied positions for the semester was 20.745,
representing a level of occupation of 81%, an increase of 5 percentage points
from the same period of the previous year.

Accumulated CapEx in June amounted to 8.2 million euros, 25.8% more than in the
first half of 2003, mainly due to the investments made by Atento Brazil to
attend new services and clients and the implementation of the new call center in
Chile (Vicuna) and Mexico (Puebla).

Finally, operating free cash flow (EBITDA-CapEx) reached 32.7 million euros
compared with the 18.8 million euros generated in January-June 2003.


ATENTO GROUP
CONSOLIDATED INCOME STATEMENT
 Unaudited figures (Euros in millions)
                                            January - June                                        April - June
                                         2004       2003    % Chg                             2004       2003    % Chg
Operating revenues                      279.4      241.9     15.5                            145.3      119.4     21.7
Operating expenses                     (240.1)    (218.1)    10.1                           (125.2)    (109.1)    14.7
Other net operating income                1.6        1.6      1.3                              1.3        1.4     (6.7)
(expense)
EBITDA                                   40.9       25.3     61.3                             21.5       11.7     83.8
Depreciation and amortization           (19.4)     (27.5)   (29.4)                            (9.4)     (13.6)   (30.8)
Operating profit                         21.4       (2.1)    c.s.                             12.1       (1.9)    c.s.
Financial net income (expense)           (9.5)     (17.1)   (44.5)                            (5.9)      (8.7)   (31.4)
Amortization of goodwill                 (3.2)      (3.5)   (10.0)                            (1.6)      (1.7)    (5.7)
Extraordinary net income (expense)       (4.0)       1.2     c.s.                             (3.6)       0.8     c.s.
Income before taxes                       4.8      (21.6)    c.s.                              0.9      (11.5)    c.s.
Income taxes                             (2.0)       6.8     c.s.                             (0.0)       3.1     c.s.
Net income before minority                2.8      (14.8)    c.s.                              0.9       (8.4)    c.s.
interests
Minority interests                       (0.6)      (0.1)    n.s.                             (0.2)      (0.1)   150.9
Net income                                2.2      (14.9)    c.s.                              0.7       (8.5)    c.s.

RESULTS BY BUSINESS LINES

Other businesses

CONTENT AND MEDIA BUSINESS

The Content and Media business obtained operating revenues of 571,1 million
euros at the end of the first half of 2004 compared with the 781,7 million euros
registered during the same period of the previous year, mainly due to the
consolidation by the global integration method of the results of Antena 3, Onda
Cero, its subsidiary, and Euroleague during the first half of 2003. These
companies being subsequently removed from the consolidation perimeter of the
Telefonica Group. Without taking into account these changes in the consolidation
perimeter, consolidated revenues would grow more than 12% vs. the first half of
2003, mainly due to the positive performance of Endemol in its English speaking
markets, and of ATCO, in a context of recovery of the advertising market in
Argentina.

The consolidated EBITDA of the business during the first half of the year
amounted to 87,1 million euros, as compared with the 127,2 million euros
obtained during the same period of 2003. Excluding the contribution made to
consolidated EBITDA by Antena 3, Onda Cero and Euroleague during the first six
months of 2003, the EBITDA growth would be 5.8%.

ENDEMOL

The Endemol Group generated revenues of 488,3 million euros during the first
half of 2004, which was 22,4% more than in the same period of the previous year.
In EBITDA terms, Endemol registered 83,4 million euros, 14,9% more than in the
first half of 2003. This positive performance was mainly achieved in its English
speaking markets (the United States and the United Kingdom), where the most
profitable formats for the company are produced, highlighting among them 'Fear
Factor' in the United States.

ATCO

The advertising market in Argentina during the first half of 2004 grew by
approximately 54% with respect to the same period of the previous year. In this
positive context, Telefe reaffirmed its position as leader of the free-to-air
television market, with an increase of 3 percentage points in audience, reaching
35,7% of the total audience, and maintaining a strong difference of 7,9
percentage points with its main competitor.

During the first half of 2004, ATCO's (Telefe and Radio Continental) operating
revenues rose to 141,6 million pesos, 40,0% higher than the figure obtained
during the first half of 2003 and EBITDA climbed to 34,6 million pesos, as
compared with the 8,8 million pesos recorded in the same period of the previous
year.


CONTENT AND MEDIA BUSINESS
CONSOLIDATED INCOME STATEMENT
 Unaudited figures (Euros in millions)
                                            January - June                                     April - June
                                         2004       2003    % Chg                          2004       2003    % Chg
Operating revenues                      571.1      781.7    (26.9)                        297.3      409.5    (27.4)
Internal expend capitalized in            0.0        0.0     n.s.                           0.0        0.0     n.s.
fixed assets (1)
Operating expenses                     (479.7)    (670.4)   (28.4)                       (251.8)    (328.1)   (23.3)
Other net operating income               (4.4)      15.8     c.s.                          (0.3)       9.1     c.s.
(expense)
EBITDA                                   87.1      127.2    (31.6)                         45.3       90.5    (50.0)
Depreciation and amortization           (14.3)     (32.1)   (55.4)                         (7.3)     (17.5)   (58.3)
Operating profit                         72.7       95.1    (23.5)                         38.0       73.0    (48.0)
Profit from associated companies          1.8      (58.7)    c.s.                          (4.9)     (31.6)   (84.6)
Financial net income (expense)          (20.7)     (21.7)    (4.6)                         (9.8)     (10.8)    (8.9)
Amortization of goodwill                (60.9)     (41.5)    46.6                         (30.9)     (21.5)    43.8
Extraordinary net income (expense)      (13.7)     (44.9)   (69.5)                        (17.5)     (30.8)   (43.2)
Income before taxes                     (20.8)     (71.8)   (71.0)                        (25.1)     (21.6)    16.1
Income taxes                            (35.3)      (9.6)   266.5                          (7.3)     (22.6)   (67.9)
Net income before minority              (56.2)     (81.5)   (31.1)                        (32.4)     (44.2)   (26.8)
interests
Minority interests                       (2.0)      (3.9)   (49.6)                         (2.0)      (7.9)   (74.2)
Net income                              (58.1)     (85.4)   (31.9)                        (34.4)     (52.1)   (34.0)

(1) Including work in process.


RESULTS BY BUSINESS LINES

Other businesses

TELEFONICA DEUTSCHLAND GROUP

Telefonica Deutschland Group obtained revenues of 172.8 million euros in the
first six months of 2004, a decrease of 12.6% year on year, due primarily to the
reduction in revenues from narrowband services which has not yet been offset by
the increase in broadband business, which nearly accounted for 12% of the total
revenues.

With respect to the broadband business, it is important to highlight the
addition of 278,000 new ADSL users in the second quarter within Telefonica
Deutschland wholesale (T-ZISP) offer in the German market. As a result, the
total number of the company's ADSL users exceeded the figure of 597,000 (both in
the German and UK markets), providing services to 4 out of the 5 top main ISPs
in Germany.

EBITDA reached a total of 5.4 million euros in the first six months of 2004,
with an EBITDA margin of 3.1%, which compares with the 4.5 million euros
registered in the same period of the previous year.



TELEFONICA DEUTSCHLAND GROUP
SELECTED FINANCIAL DATA
 Unaudited figures (Euros in millions)
                                                                           January - June
                                                                     2004               2003           % Chg
Operating revenues                                                  172.8              197.6           (12.6)
EBITDA                                                                5.4                4.5            21.3
EBITDA margin                                                        3.1%               2.3%         0.9 p.p.

ADDENDA

Companies included in each Financial Statement

Based on what was indicated at the start of this report, the results breakdown
of Telefonica Group are detailed according to the business in which the Group
has a presence. The main differences between this view and the one that would
apply attending to the legal structure, are the following:

•       Telefonica, S.A. directly participates in the share capital of Endemol
Entertainment Holding, N.V., which has been included in Telefonica de Contenidos
Group. Furthermore, in the fiscal year 2003 the results from the participation,
and following divestiture, in Antena 3 de Television, S.A., were integrated
within the Telefonica de Contenidos Group results, although it had been
participated directly by Telefonica S.A. through a part of the year. The results
from the Sogecable stake have been also assigned to Telefonica de Contenidos
Group, even though a part of the investment is legally dependent upon
Telefonica, S.A.

•       Telefonica Holding Argentina, S.A. holds 26.82% of Atlantida de
Comunicaciones, S.A. (ATCO) and 26.82% of AC Inversora, S.A. which, for those
purposes, are considered to be part of Telefonica de Contenidos Group,
consolidating 100% share capital of both companies.

•       In the case of Compania de Telecomunicaciones de Chile, S.A. (CTC),
participated by Telefonica Latinoamerica, the activities of the mobile telephony
business in Chile have already been assigned to the mobile business.

•       The participation of Telefonica Group in IPSE 2000 SpA is assigned to
the cellular business, also including the investment legally dependent upon
Telefonica DataCorp, S.A.

•       In the case of Telefonica de Argentina (TASA), participated by
Telefonica Latinoamerica Group, Telinver has been assigned to the directories
business, in line with our vision for the total Telefonica's directories
business.

•       Telefonica Data Group, legally dependent upon Telefonica S.A., has been
segregated and subsequentally integrated into the fixed line activities both in
Spain and Latin America for presentation porposes, and according to geographic
criterias. The stakes not included in neither of the previous geographic areas
will be consolidated directly by Telefonica S.A.

•       Emergia Group, directly participated by Telefonica S.A., has been
consolidated within the Telefonica Latinoamerica Group.

ADDENDA

Key Holdings of the Telefonica Group and its Subsidiaries detailed by business
lines

TELEFONICA GROUP
                                                                   % Part
Telefonica de Espana                                              100.00%
Telefonica Moviles                                                 92.44%
Telefonica Latinoamerica                                          100.00%
TPI Group                                                          59.90%
Terra Lycos Group                                                  75.29%
Telefonica de Contenidos                                          100.00%
Atento Group                                                       91.35%


TELEFONICA DE ESPANA GROUP
                                                                       % Part
Telyco                                                                100.00%
Telefonica Telecomunicaciones Publicas                                100.00%
Telefonica Soluciones Sectoriales                                     100.00%
Telefonica Empresas Espana                                            100.00%
T. Soluciones de Informatica y Comunic.                               100.00%


TELEFONICA LATINOAMERICA GROUP
                                                                       % Part
Telesp                                                                 87.49%
Telefonica del Peru                                                    97.15%
Telefonica de Argentina                                                98.03%
TLD Puerto Rico                                                        98.00%
CTC Chile                                                              43.64%
CAN Telefonos de Venezuela (CANTV)                                      6.92%
Telefonica Data Mexico Holding                                        100.00%
Telefonica Data Colombia                                               65.00%
Telefonica Empresas Brasil                                            100.00%
Telefonica Empresas Peru                                               97.07%
Telefonica Data Argentina                                              97.92%
Telefonica Data USA                                                   100.00%
T. Internacional Wholesale Services                                   100.00%
Emergia                                                               100.00%


TELEFONICA MOVILES GROUP
                                                                       % Part
Telefonica Moviles Espana                                             100.00%
Brasilcel (1)                                                          50.00%
TCP Argentina                                                          97.93%
TEM Peru                                                               97.97%
T. Moviles Mexico                                                      92.00%
TEM El Salvador                                                        90.26%
TEM Guatemala                                                         100.00%
Group 3G (Germany)                                                     57.20%
IPSE 2000 (Italy)                                                      45.59%
3G Mobile AG (Switzerland)                                            100.00%
Medi Telecom                                                           32.18%
Telefonica Moviles Interacciona                                       100.00%
Mobipay Espana                                                         13.36%
Mobipay Internacional                                                  36.05%
T. Moviles Aplicac. y Soluciones (Chile)                              100.00%

(1) Joint Venture which fully consolidates TeleSudeste Celular, Celular CRT,
TeleLeste Celular, Telesp Celular Participacoes. From May 2003 Telesp Celular
Participacoes includes the stake acquired in TeleCentro Oeste Participacoes.
Brasilcel's stake in subsidiaries in March 2004: TeleSudeste Celular 84.14%;
Telesp Celular Participacoes 65.12%; CRT Celular 50.42%; TeleLeste Celular
27.86% and TeleCentro Oeste Participacoes 19.04%.


TPI - PAGINAS AMARILLAS GROUP
                                                                       % Part
Goodman Business Press                                                100.00%
Publiguias (Chile)                                                    100.00%
TPI Brasil                                                            100.00%
TPI Peru                                                              100.00%
11888 Servicios de Consulta Telefonica                                100.00%


TERRA LYCOS GROUP
                                                                       % Part
Lycos, Inc.                                                           100.00%
Lycos Europe                                                           32.01%
Terra Networks Peru                                                    99.99%
Terra Networks Mexico                                                  99.99%
Terra Networks USA                                                    100.00%
Terra Networks Guatemala                                              100.00%
Terra Networks Venezuela                                              100.00%
Terra Networks Brasil                                                 100.00%
Terra Networks Argentina                                               99.99%
Terra Networks Espana                                                 100.00%
Terra Networks Chile                                                  100.00%
Terra Networks Colombia                                                68.30%
Ifigenia Plus                                                         100.00%
EducaTerra                                                            100.00%
R.U.M.B.O.                                                             50.00%
Uno-E Bank                                                             33.00%
One Travel.com                                                         54.15%


ATENTO GROUP
                                                                   % Part
Atento Teleservicios Espana, S.A.                                 100.00%
Atento Brasil, S.A.                                               100.00%
Atento Argentina, S.A.                                            100.00%
Atento de Guatemala, S.A.                                         100.00%
Atento Mexicana, S.A. de C.V.                                     100.00%
Atento Peru, S.A.C.                                               100.00%
Atento Chile, S.A.                                                100.00%
Atento Maroc, S.A.                                                100.00%
Atento El Salvador, S.A. de C.V.                                  100.00%


TELEFONICA DE CONTENIDOS GROUP
                                                                       % Part
Telefe                                                                100.00%
Endemol                                                                99.60%
Lola Films                                                             70.00%
Torneos y Competencias                                                 20.00%
Servicios de Teledistribucion                                         100.00%
Sogecable                                                              23.83%
Telefonica Servicios Audiovisuales                                    100.00%
Pearson                                                                 4.84%
Hispasat                                                               13.23%

ADDENDA

Significant Events

•       On July 26th Telefonica Moviles announced that it has accepted the terms
of the proposal approved by the extraordinary shareholders' meeting of
Telefonica CTC Chile for the acquisition by Telefonica Moviles of 100% of the
shares of Telefonica Movil Chile, in which the purchase price is increased by up
to a maximum of 51 million dollars, to compensate for the fiscal cost of the
transaction for CTC.

The price offered by Telefonica Moviles for the purchase of 100% of the shares
of Telefonica Movil Chile was 1,007 million dollars. Telefonica Moviles assumes
the debt of Telefonica Movil Chile, which at March 31st 2004 stood at 243
million dollars.

•       On July 6, 2004, Telefonica Moviles Mexico announced the rollout of EDGE
technology on its GSM network. The Company will offer to its customers
five-times faster web browsing speeds than traditional fixed-line connections,
along with video streaming, Multimedia Messaging, high speed data transmission
capabilities, etc.

•       On June 25, 2004, Telefonica's treasury stock position was 131,075,320
shares representing 2.645% of its current share capital.

•       On June 16, 2004, Telefonica Moviles S.A. paid a dividend of 0.1838
euros per share against 2003 fiscal year results. The dividend represents around
50% of 2003 Company's net income.



ADDENDA

Changes to the Perimeter and Accounting Criteria of Consolidation

In the first half of 2004, the following changes have occurred in the
consolidation perimeter:

TELEFONICA GROUP

•       During 2004, Telefonica Group has purchased 59,176 shares in the Dutch
company Endemol Entertainment Holding, N.V. (Endemol) for 1.48 million euros.
After this transaction, Telefonica Group's stake in Endemol has reached 99.66%.
The company continues to be fully consolidated within the Telefonica Group.

•       Telefonica S.A. has purchased 44,656,592 shares of Portugal Telecom,
S.G.P.S., S.A. for 402.30 million euros, increasing its direct stake in the
company to 7.30%. The direct and indirect effective stake of Group Telefonica is
8.26%. The company continues to consolidate by the equity method in the
financial statements of Telefonica Group.

TELEFONICA DE ESPANA GROUP

•       As part of its ongoing process to restructure its group of companies,
Telefonica Cable, S.A., a wholly-owned subsidiary of Telefonica de Espana, S.A.,
has taken over the following local operators: Telefonica Cable Asturias S.A.,
Telefonica Cable Valencia S.A., Telefonica Cable Extremadura S.A. and Telefonica
Cable Balears S.A. All of these companies, which were fully consolidated within
the Telefonica Group, have been removed from the Group's consolidation perimeter
this year.

•       The 2.13% stake that Telefonica de Espana, S.A. owned in the French
company Eutelsat, S.A., was sold for 44.83 million euros, resulting in a 21.43
million euros net capital gain. The company was recorded within the 'Other
investments' item of the Telefonica Group's consolidated balance sheet.

•       The Spanish company Telefonica Mobile Solutions, S.A.U. has been taken
over by its parent company Telefonica Soluciones de Informatica y Comunicaciones
de Espana, S.A.U. This company, which used to be consolidated within Telefonica
Group's financial statements by the full integration method, has been removed
from the consolidation perimeter.

•       Telefonica Soluciones Informaticas y de Comunicaciones de Espana, S.A.
has subscribed 0.61 million euros in the capital increase carried out by the
company Soluciones Tecnologicas para la Alimentacion, S.L. by means of a
compensation of the credit hold against the company for the same amount. This
move is the preliminary step to close the agreement currently under negotiations
aiming at ending the stake of Telefonica Soluciones Informaticas y de
Comunicaciones de Espana in the capital of Soluciones Tecnologicas para la
Alimentacion, S.L.

TELEFONICA LATINOAMERICA GROUP

•       The Brazilian company Aix Participacoes, which was integrated by the
equity method in the consolidated accounts of the Telefonica Group in 2003, is
now incorporated using the proportional integration method.

•       The U.S. company Katalyx, Inc. took over the U.S. companies Adquira,
Inc. and Katalyx Transportation, LLC. Both companies, which were integrated in
2003 in the consolidated accounts of the Telefonica Group using the full
integration method, have been removed from the consolidation perimeter.

•       The Peruvian company Telefonica Empresas Peru, S.A.A. has taken over the
Peruvian company Telefonica Servicios Financieros, S.A.C. The company, which in
2003 was integrated in the consolidated accounts of the Telefonica Group using
the full integration method, has been removed from the consolidation perimeter.

•       The Mexican companies Katalyx Construction Mexico, S.R.L., Katalyx
Health Mexico, S.R.L., Katalyx Cataloguing Mexico, S.R.L. de C.V., Katalyx Food
Service Mexico, S.R.L. de C.V. and Katalyx Transportation Mexico, LLC. were
liquidated in February this year. All of these companies, which in 2003 were
integrated in the consolidated accounts of the Telefonica Group using the full
integration method, have been removed from the consolidation perimeter.

•       The Argentinean companies Katalyx Transportation Argentina, S.R.L.,
Katalyx Construction Argentina, Katalyx Food Service Argentina, S.R.L., Katalyx
Cataloguing Argentina, S.R.L. de C.V. and Katalyx Argentina S.A. were liquidated
during this first semester. All of these companies, which in 2003 were
integrated in the consolidated accounts of the Telefonica Group using the full
integration method, have been removed from the consolidation perimeter.

TELEFONICA MOVILES GROUP

•       In Brazil, in March 2004, the tax credits used by Tele Leste, TCO, CRT
and Tele Sudeste as a result of the existing goodwill in those companies were
capitalized. This capitalization has not resulted in any cash outflow for
Brasilcel, but has led to an increase in the shareholdings in these companies.

•       Acquisition of an additional 13.95% stake in the share capital of the
Spanish company Mobipay International, S.A., reaching a 50% stake in the
company. The company, which was integrated in the consolidated accounts of the
Telefonica Group using the equity method, consolidates as from June 1st by the
proportional method.

•       At the end of June 2004 Brasilcel acquired NTT DoCoMo and Itochu
Corporation shareholdings in the share capital of Sudestelcel Participacoes, the
holding company controlling a stake in Tele Sudeste Celular Participacoes.
Through this operation, Brasilcel now controls 100% of Sudestelcel Participacoes
and continues to consolidate in Brasilcel Group's financial statements by the
full integration method. Likewise, Brasilcel Group consolidates by the
proportional method in Telefonica Group's financial statements.

TPI GROUP

•       The Parent Company Telefonica Publicidad e Informacion S.A., has
purchased an additional 49% stake of the share capital of its Chilean
susbsidiary Impresora y Comercial Publiguias for 65.6 million euros, reaching a
100% stake in the company. In this deal, 9% of the share capital has been bought
to the Chilean Compania de Telecomunicaciones de Chile, S.A., a subsidiary of
Telefonica Group. The company continues to consolidate in the financial
statements of Group Telefonica by the full integration method.

TERRA LYCOS GROUP

•       Emplaza, S.A., in which the Terra Lycos Group had a 20% stake and that
was no longer included in the consolidation perimeter as of June 2003 because it
was not running any business, was liquidated in January 2004.

•       In March 2004 Lycos, Inc. sold its stakes in Wit Capital and GSI Global
Sports. These companies were recorded under the 'Other investments' item.
Capital gains from selling these stakes amounted to 0.15 million euros.

•       During the second quarter, Lycos Inc. sold its stakes in Amazon,
Interland, Cross Media and Easy Link. Moreover, the company sold part of its
investment in Autobytel. All these companies were included under the 'Other
investments' item.

•       In June, 100% of the Mexican company Tecnologia SVA, S.A. has been sold,
generating a capital gain of 10.77 million euros. This company, which used to be
consolidated in Telefonica Group's financial statements by the full integration
method, has been removed from the consolidation perimeter.

ATENTO GROUP

•       Atento USA, Inc., has been dissolved and all its assets and liabilities
were transferred to its parent company Atento Holding Inc. effective January 1,
2004. The company, which in 2003 was included in the consolidated financial
statements of the Telefonica Group by the full consolidation method, has been
removed from the consolidation perimeter.

•       The sale of 100% of the shares in Atento Guatemala Comercial, S.A., in
March 2004, resulted in a 0.02 million euros capital gain for the Telefonica
Group. The company has been removed from the consolidation perimeter of the
Telefonica Group, in which it was fully consolidated.

•       On April 30th, the US company Atento Holding Inc. has been dissolved and
all its assets and liabilities transferred to its Dutch parent company Atento
N.V. This company, which used to be consolidated in Telefonica Group's financial
statements by the full integration method, has been removed from the
consolidation perimeter.









DISCLAIMER



This document contains statements that constitute forward looking statements in
its general meaning and within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements appear in a number of places in this
document and include statements regarding the intent, belief or current
expectations of the customer base, estimates regarding future growth in the
different business lines and the global business, market share, financial
results and other aspects of the activity and situation relating to the Company.
The forward-looking statements in this document can be identified, in some
instances, by the use of words such as 'expects', 'anticipates', 'intends',
'believes', and similar language or the negative thereof or by forward-looking
nature of discussions of strategy, plans or intentions.

Such forward-looking statements are not guarantees of future performance and
involve risks and uncertainties and actual results may differ materially from
those in the forward looking statements as a result of various factors.

Analysts and investors are cautioned not to place undue reliance on those
forward looking statements which speak only as of the date of this presentation.
Telefonica undertakes no obligation to release publicly the results of any
revisions to these forward looking statements which may be made to reflect
events and circumstances after the date of this presentation, including, without
limitation, changes in Telefonica's business or acquisition strategy or to
reflect the occurrence of unanticipated events. Analysts and investors are
encouraged to consult the Company's Annual Report as well as periodic filings
filed with the relevant Securities Markets Regulators, and in particular with
the Spanish Market Regulator







For additional information, please contact.



Investor Relations

Gran Via, 28 - 28013 Madrid (Spain)



Phone number:

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Email:

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